Dated June 26, 2002
WEXFORD GOLDFIELDS LIMITED
as the Borrower
ANY OTHER OBLIGOR
PARTY HERETO FROM TIME TO TIME
each as an additional Obligor
STANDARD BANK LONDON LIMITED
as the Facility Agent
STANDARD BANK LONDON LIMITED
as the Security Trustee
and
THE LAW DEBENTURE TRUST CORPORATION PLC together with
any other person party hereto as a Royalty Holder
as the Royalty Holders
-----------------------------------------------
COMMON TERMS AGREEMENT
for
WASSA GOLD PROJECT
-----------------------------------------------
Mayer, Brown, ▇▇▇▇ & Maw
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
TABLE OF CONTENTS
PAGE
1. DEFINITIONS......................................................................1
2. DEVELOPMENT OF PROJECT..........................................................23
3. PROJECT ACCOUNTS................................................................27
4. REPRESENTATIONS AND WARRANTIES..................................................30
5. COVENANTS.......................................................................37
6. NEGATIVE COVENANTS..............................................................47
7. EVENTS OF DEFAULT...............................................................52
8. INTERCREDITOR PROVISIONS........................................................56
9. MEETINGS........................................................................59
10. FINANCE PARTY ACTION FOLLOWING DEFAULTS OR EVENTS OF DEFAULT....................59
11. PRO RATA SHARING................................................................61
12. SECURITY AND SECURITY TRUSTEE PROVISIONS........................................62
13. TRANSFERS.......................................................................77
14. FEES AND LATE PAYMENTS..........................................................78
15. MISCELLANEOUS...................................................................79
16. ACCESSION OF OTHER PARTIES......................................................85
17. ROLE OF THE LAW DEBENTURE TRUST CORPORATION P.L.C...............................85
SCHEDULE 1 DISCLOSURE SCHEDULE
SCHEDULE 2 SECURITY TRUSTEE DEED OF ACCESSION
SCHEDULE 3 OBLIGOR DEED OF ACCESSION
SCHEDULE 4 ROYALTY HOLDER DEED OF ACCESSION
SCHEDULE 5 FACILITY AGENT DEED OF ACCESSION
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THIS COMMON TERMS AGREEMENT, dated June 26, 2002 (as the same may be
amended, modified or supplemented from time to time, this "AGREEMENT"), is made
among:
(1) WEXFORD GOLDFIELDS LIMITED, a company incorporated under the laws of the
Republic of Ghana (the "BORROWER");
(2) EACH OTHER OBLIGOR PARTY HERETO FROM TIME TO TIME;
(3) STANDARD BANK LONDON LIMITED, as agent for the financial institutions
party to the Loan Agreement as Lenders (the "FACILITY AGENT");
(4) STANDARD BANK LONDON LIMITED, a company incorporated under the laws of
England, in its capacity as the security trustee hereunder (the
"SECURITY TRUSTEE"); and
(5) THE LAW DEBENTURE TRUST CORPORATION P.L.C., a company incorporated under
the law of England (collectively with each other Royalty Holder party
hereto from time to time, the "ROYALTY HOLDERS" and each a "ROYALTY
HOLDER").
RECITALS:
(A) the Borrower has acquired the Mining Lease and the Borrower owns the
right to develop and mine the gold and associated minerals contained in
deposits located in the Lease Area (as defined in the Mining Lease),
such area being located in Akyempin in the Western District of the
Republic of Ghana;
(B) the Borrower has requested that each Original Lender provide a
Commitment to the Borrower to make Loans for the purposes of enabling
the Borrower to finance the acquisition of the Mining Lease and other
assets from the Borrower;
(C) The Law Debenture Trust Corporation p.l.c. as mortgagee has sold the
Acquired Assets to the Borrower;
(D) as security for the due and punctual payment and performance of its
Obligations, the Borrower is willing to mortgage, charge and otherwise
secure in favour of the Security Trustee all its right, title and
interest in, amongst other things, the Project Assets and certain
agreements relating thereto; and
(E) the Borrower has agreed to grant certain undertakings to the Finance
Parties regarding (amongst other things) the Obligations of the Borrower
to the Finance Parties and the funding, management and completion of the
Project.
OPERATIVE PROVISIONS:
1. DEFINITIONS
1.1 DEFINED TERMS
The following terms when used in this Agreement and each other Finance
Document, including its and their preamble and recitals, have the
following meanings:
"ACQUIRED ASSETS" means the assets the subject of the Asset Sale
Agreements.
"ADDRESS FOR NOTICES" is defined in Clause 15.2.
"ADDITIONAL OBLIGOR" means any person party to a Deed of Accession as an
Additional Obligor.
"AGREEMENT" is defined in the preamble.
"AGREED FORM" means, in respect of any Instrument:
(a) in a form executed by the relevant parties and dated on or about
the date hereof; or
(b) if not executed and dated on or about the date hereof,
substantially in the form initialled on the date hereof by the
Facility Agent (or Mayer, Brown, ▇▇▇▇ & Maw on its behalf) and
an Authorised Representative of the Borrower or the Sponsor (or
▇▇▇▇▇▇ & Co on its behalf); or
(c) in such form as the Facility Agent and each Obligor party
thereto (or, if no Obligor is party thereto, the Borrower) agree
is the Agreed Form of such Instrument for the purposes of this
Agreement,
and the Agreed Form of any Instrument described in clause (c) shall have
precedence over and replace the Agreed Form of such Instrument described
in clauses (a) or (b).
"ANNUAL BUDGET" means the annual budget approved pursuant to Clause
2.1(b).
"ANNUAL INDEPENDENT ENGINEER'S REPORT" means a report addressed to the
Facility Agent, the Lenders and any Royalty Holder by the Independent
Engineer in a form satisfactory to the Required Secured Parties, and
relating to the status of the Mine and the progress of the Project
(including, in the case of each Annual Independent Engineer's Report
prepared in respect of each twelve-monthly period ending on December 31
of each calendar year, an environmental summary in connection
therewith), each Obligor's compliance with this Agreement and each other
Operative Document to which it is a party and such other matters in
connection therewith as the Facility Agent or any Royalty Holder may
reasonably request, and relating to each consecutive twelve-monthly
period ending on December 31 of each calendar year occurring after the
Effective Date,
"APPLICABLE LAW" means, with respect to any person or matter, any
supranational, national, federal, state, provincial, regional or local
statute, law, rule, treaty, convention, regulation, order, decree,
directive, measure, procedure, rule, consent, decree, request,
determination or other requirement (whether or not having the force of
law) relating to such person or matter and, where applicable, any
interpretation thereof by any Governmental Agency having jurisdiction
with respect thereto or charged with the administration or
interpretation thereof.
"APPLICABLE MARGIN" means:(a) prior to Economic Completion, 2.5% per
annum and (b) thereafter, 2.0% per annum.
"APPROVAL" means an approval, authorisation, license, permit, consent,
filing or registration by or with any Governmental Agency or other
person whether or not referred to in Item 1 ("APPROVALS") of the
Disclosure Schedule.
"APPROVED BUDGET" means the "FINANCIAL MODEL SUMMARY OF CAPITAL
EXPENDITURES" to be included in the Financial Model and containing
details as to Project Costs to be incurred in connection with the
construction of the Mine, as the same may be amended from time to time
as a result of changes to the Development Plan made pursuant to Clause
2.5.
"APPROVED SUBORDINATED INDEBTEDNESS" means any indebtedness of the
Borrower to any other Obligor which is subject to the terms of a
Subordination Agreement.
"APPROVED PROJECT INDEBTEDNESS" means indebtedness incurred by the
Borrower (as borrower) where:
(a) the proceeds of such indebtedness is provided after the Economic
Completion Date and is used solely to construct a gold
processing plant at the Project; and
(b) such indebtedness (if incurred prior to the Discharge Date) is
provided on terms acceptable to (and previously approved in
writing by) the Required Lenders acting reasonably.
"ASSET SALE AGREEMENTS" means (a) the asset sale agreement dated March
1, 2002 between the Borrower and The Law Debenture Trust Corporation
p.l.c., and (b) the asset sale agreement dated March 15, 2002 between
the Borrower, The Law Debenture Trust Corporation p.l.c. and SGL (acting
by its receiver and manager, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇).
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"ASSIGNMENTS OF REINSURANCES" means, collectively, each Deed of
Assignment of Reinsurances between a Ghana Insurer, the Borrower and the
Security Trustee substantially in the Agreed Form.
"AUDITOR" means PricewaterhouseCoopers, or such other independent
certified public or chartered accountants of recognised international
standing acceptable to the Security Trustee (acting reasonably).
"AUTHORISED REPRESENTATIVE" means, relative to any Obligor, those of its
officers whose signatures and incumbency shall have been certified:
(a) prior to the Discharge Date, to the Facility Agent and each
Royalty Holder; or
(b) on and after the Discharge Date, to each Royalty Holder,
in each case as such Obligor's Authorised Representative.
"AVAILABILITY PERIOD" is defined in the Loan Agreement.
"BORROWER" is defined in the preamble.
"BORROWER SECURITY AGREEMENT (GHANA-DEBENTURE)" means the Security
Agreement between the Borrower and the Security Trustee relating to the
Ghanaian assets of the Borrower substantially in the Agreed Form.
"BORROWER SECURITY AGREEMENT (U.K.-DEBENTURE)" means the Debenture
between the Borrower and the Security Trustee relating to the
non-Ghanaian assets of the Borrower substantially in the Agreed Form.
"BORROWER SECURITY AGREEMENTS" means, collectively, the Borrower
Security Agreement (Ghana-Debenture) and the Borrower Security Agreement
(U.K.-Debenture).
"BUSINESS DAY" is defined in the Loan Agreement.
"CALCULATION DATE" means the Economic Completion Date and each March 31,
June 30, September 30 and December 31 in each calendar year occurring
after the Economic Completion Date.
"CAPITAL CONTRIBUTION" means a contribution made (whether in cash or
otherwise and whether directly or indirectly) by one person to the
ordinary share capital or equity of another person.
"CAPITAL EXPENDITURES" means, for any period and with respect to any
person, the sum of:
(a) the aggregate amount of all expenditures of such person for
fixed or capital assets (including expenditures incurred in
connection with deferred development costs) made during such
period which would be classified as capital expenditures;
plus
(b) the aggregate amount payable by such person during such period
in respect of all Capital Leases which such person has entered
into as lessee.
"CAPITAL LEASES" means any lease of property (real or personal) which
could be classified as a borrowing in accordance with GAAP.
"CASH FLOW PERIOD" means, in connection with any repayment of any Loan
or the payment of interest to be made on any Cash Sweep Date pursuant to
any Finance Document, the Fiscal Quarter ending approximately one month
before such Cash Sweep Date.
"CASH FLOW SCHEDULE" means the schedules included in the Financial Model
(excluding, however, the schedule of "Capital Costs") and setting forth
the projected Future Net Cash Flow of, and containing other financial
and operational data relating to, cash flow projected to be generated by
the Project as the
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same may be amended from time to time as a result of changes to the
Development Plan made pursuant to Clause 2.5.
"CASH SWEEP DATE" means the last day of each January, April, July,
October in each calendar year.
"CAYSTAR" means Caystar Holdings, a company incorporated under the laws
of the Cayman Islands.
"CAYSTAR HOLDINGS SECURITY AGREEMENT" means the Deed of Charge between
Caystar and the Security Trustee substantially in the Agreed form.
"CEDI" and the sign "C" means the lawful money of Ghana.
"CENTRAL BANK" means the Bank of Ghana.
"CFAD" means, for any Cash Flow Period, the lesser of:
(a) the product of:
(i) Gross Cash Flow for such Cash Flow Period, minus
(ii) Project Costs for such Cash Flow Period, minus
(iii) Excess Cash Flow for such Cash Flow Period, and
(b) Excess Revenue for such Cash Flow Period.
"CHANGE IN CONTROL" means, commencing from the New Ownership Date, any
of the following:
(a) the failure of the Sponsor to own directly or indirectly (and to
have sole power to vote and dispose of), free and clear of all
liens 100% of the share capital (however designated) of the
immediate holding company of the Borrower; or
(b) the failure of the Holding Company to own directly (and to have
sole power to vote and dispose of), free and clear of all liens
(other than those granted in favour of Finance Parties pursuant
to the Holding Company Security Agreement) 90% of the share
capital (however designated) of the Borrower, unless as a result
of a Permitted Expropriation.
"CHARGED SHARES" means each of the shares the subject of liens granted
pursuant to the Share Security Agreements.
"COMMITMENT" is defined in the Loan Agreement.
"COMMITTED PRICE PROTECTION AGREEMENTS" means net forward sale, spot
deferred sales or other contracts (including put options) providing for
a binding commitment to sell (or in the case of the counterparty to any
put options, buy) Gold.
"COMPLIANCE CERTIFICATE" means a certificate duly executed by an
Authorised Representative of the Borrower substantially in the Agreed
Form.
"CONTRACTORS" means, collectively:
(a) the Manager;
(b) the Project Engineer;
(c) any Mining Contractor;
(d) the Refiner; and
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(e) any other person who the Borrower and the Security Trustee agree
is a Contractor.
"CONTRACTORS' UNDERTAKINGS" means:
(a) the Manager's Confirmation and Undertaking;
(b) The Project Engineer's Confirmation and Undertaking;
(c) the Mining Contractor's Confirmation and Undertaking;
(d) the Refiner's Confirmation and Undertaking; and
(e) any other Instrument which the Borrower and the Security Trustee
agree in writing is a Contractor's Undertaking.
"CONTRACTUAL OBLIGATION" means, relative to any person, any provision of
any security issued by such person or of any Instrument or undertaking
to which such person is a party or by which it or any of its property is
bound.
"DACTA" is defined in Clause 17(a).
"DANGEROUS SUBSTANCE" means any natural or artificial substance which
may give rise to a material risk of causing harm to man or any other
living organism or damaging the environment including any controlled,
special, hazardous, toxic, radioactive or dangerous waste.
"DEED OF WARRANTY" means the Deed of Warranty, Confirmation and
Conditions in the Agreed Form, from the Government of Ghana in favour of
the Borrower and issued in connection with the Project.
"DEFAULT" means any Potential Event of Default.
"DEFERRED CONSIDERATION" is defined in the Asset Sale Agreements dated
March 15, 2002 among the Borrower, The Law Debenture Trust Corporation
p.l.c. and SGL (acting by its receiver and manager, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇).
"DEVELOPMENT PLAN" means the Development Plan agreed pursuant to Clause
2.3 as amended pursuant to Clause 2.
"DISCHARGE DATE" means the date on which all the Liabilities to the
Lenders have been irrevocably and fully discharged and any Commitment to
advance monies on the part of any of the Lenders under the Loan
Agreement has been cancelled or terminated.
"DISCLOSURE SCHEDULE" means the Disclosure Schedule attached hereto as
Schedule 1.
"DISCOUNT RATE" means, in connection with the calculation of Present
Value of Future Net Cash Flow on any date in respect of the Loan Life
Ratio and Project Life Ratio, an interest rate per annum in the amount
of the sum of: (x) the LIBOR calculated by the Security Trustee for such
period as it may select plus (y) the then Applicable Margin.
"DISPUTE" is defined in Clause 15.15(a).
"DOLLAR" and the sign "U.S.$" means the lawful currency of the United
States of America.
"ECONOMIC COMPLETION" means the achievement of production at the Mine
and shipment to the Refiner by the Borrower of not less than 30,000
Ounces in any twelve month period (or such other alternative criteria as
the Secured Parties may agree with the Borrower from time to time).
"ECONOMIC COMPLETION CERTIFICATE" means a certificate (together with all
attachments thereto) duly executed in one or more counterparts by an
Authorised Representative of the Sponsor and the Borrower, substantially
in the Agreed Form (or in such other form as the Secured Parties may
consent
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to in order to reflect any alternative criteria of the nature referred
to in the definition of "ECONOMIC COMPLETION").
"ECONOMIC COMPLETION DATE" means the first Business Day immediately
following the day on which Economic Completion shall have occurred, no
Default shall have occurred, the initial Development Plan shall have
become effective in accordance with Clause 2 and the Facility Agent
shall have received:
(a) counterparts of the Economic Completion Certificate executed by
each person referred to in the definition thereof; and
(b) (i) a Compliance Certificate calculated on the basis of the
Development Plan as then in effect (including any
changes thereto arising as a result of the circumstances
referred to in Clause 2.5(c) or 2.5(a)(ii)) as at the
proposed Economic Completion Date pursuant to Clause
5.2(c) together with an independent verification from
the Independent Engineer in form reasonably satisfactory
to the Secured Parties with respect to the statements
and calculations contained in such Compliance
Certificate; and
(ii) a compliance certificate pursuant to the Support
Agreement calculated as at the proposed Economic
Completion Date and in form and substance satisfactory
to the Secured Parties.
"EFFECTIVE DATE" is defined in Clause 15.14.
"ENFORCEMENT EVENT" means the taking of any action by:
(a) the Facility Agent pursuant to Clause 17 of the Loan Agreement;
and
(b) the Royalty Holder pursuant to Clause 6.1 of the First Royalty
Agreement or by any other Royalty Holder pursuant to any similar
provision in any other Royalty Agreement; or
(c) the occurrence of any Insolvency Default.
"ENVIRONMENTAL IMPACT STATEMENT" means such Instrument that the Borrower
and the Security Trustee shall agree from time to time is the
Environmental Impact Statement (including pursuant to Clause 2.2).
"ENVIRONMENTAL LAW" means any Applicable Law (including the
Environmental Protection Agency Act of Ghana 1994 and the World Bank
Environmental and Safety Guidelines) relating to or imposing liability
or standards of conduct concerning the protection of human health, the
environment or the conditions of the workplace or the generation,
transportation, storage or treatment, processing or disposal of any
Dangerous Substance including laws relating to reclamation of land and
waterways and laws relating to emissions, discharges, releases or
threatened releases of pollutants, contaminants, chemicals, or
industrial, toxic or hazardous substances or wastes into the environment
(including ambient air, surface water, ground water, land surface or
subsurface strata) or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling
of pollutants, contaminants, chemicals, or industrial, toxic or
hazardous substances or wastes.
"ENVIRONMENTAL LICENCE" means any permit, licence, authorisation,
consent or other approval required by any Environmental Law.
"ENVIRONMENTAL REVIEW STANDARDS" is defined in Clause 4.19(a).
"EVENT OF DEFAULT" is defined in Clause 7.1.
"EXCESS CASH FLOW" means, for any Cash Flow Period, the amount,
calculated in Dollars of:
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(a) the number of Ounces (if any) produced in such Cash Flow Period
in excess of the number of Ounces forecast in the initial
Development Plan to be produced during such Cash Flow Period
(after ignoring any increases in forecast production in the
Development Plan as a result of any changes to the Development
Plan made pursuant to Clause 2.5), multiplied by
(b) $280 less Project Operating Costs per ounces for such Cash Flow
Period as forecast in the initial agreed Development Plan
(without amendment pursuant to Clause 2).
"EXCESS REVENUE" means, for any Cash Flow Period, the amount calculated
in Dollars:
(a) the number of Ounces actually produced and sold during such Cash
Flow Period, multiplied by
(b) the average revenue per Ounce actually received from Production
by the Borrower during such Cash Flow Period which is in excess
of $280 per Ounce.
"EXPERT" means any person as is agreed by the Lenders, each Royalty
Holder and the Borrower to act as expert to determine the dispute, or
failing such agreement, a person nominated by the president of the
Institute of Mining and Metallurgy (or its successory body) for such
purposes upon application by the first of either the Borrower, or the
Facility Agent or the Royalty Holder.
"FACILITIES" is defined in the Loan Agreement.
"FACILITY AGENT" is defined in the preamble.
"FACILITY AGENT DEED OF ACCESSION" means a deed of accession
substantially in the form of Schedule 5.
"FACILITY AGENT LIABILITIES" means any Liabilities due, owing or
incurred to the Facility Agent (other than in respect of any Liabilities
due, owing or incurred to a Secured Party, including in respect of a
covenant to pay any liabilities due to such Secured Party) by any
Obligor.
"FEASIBILITY STUDY" means such document as the Borrower and the Secured
Parties shall agree is the Feasibility Study (including pursuant to
Clause 2.2(b)).
"FINAL MATURITY DATE" means the date which is five years from the New
Ownership Date.
"FINANCE DOCUMENT" means any of (a) this Agreement; (b) the Loan
Agreement; (c) the Security Agreements; (d) the Support Agreement; (e)
the Subordination Agreements; (f) each other Instrument executed by any
Obligor or any affiliate thereof evidencing any obligation (monetary or
otherwise) to any Finance Party in connection with and pursuant to this
Agreement, the other Operative Documents and the transactions
contemplated hereby and thereby and delivered to any Finance Party
(including, at any time when any Commitment is outstanding or any
Principal Amount of any Loan or any interest accrued thereon is then
outstanding to any Finance Party, any Price Protection Agreement in
effect at such time entered into between the Borrower and any Lender);
(g) so long as the Deferred Consideration remains unpaid, the Asset Sale
Agreements; (h) the Royalty Agreement; and (i) any other Instrument
which the Security Trustee and the Borrower agree is a Finance Document.
"FINANCE PARTIES" means, collectively, the Representatives, the Lenders
and the Royalty Holder.
"FINANCIAL MODEL" means the Financial Model referred to in Clause 2.3(a)
or such other financial model which the Borrower and the Security
Trustee agree is the Financial Model.
"FIRST ROYALTY AGREEMENT" means the Royalty Agreement dated the same
date hereof between the Borrower and The Law Debenture Trust Corporation
p.l.c..
"FISCAL QUARTER" means any quarter of a Fiscal Year.
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"FISCAL YEAR" means, with respect to any Obligor, any period of twelve
consecutive calendar months ending on 31 December, and references to a
Fiscal Year with a number corresponding to any calendar year (e.g., the
"2002 FISCAL YEAR") refer to the Fiscal Year ending on the 31 December
occurring during such calendar year.
"FOREIGN EXCHANGE RETENTION ACCOUNT AGREEMENT" means the Foreign
Exchange Retention Account Agreement in the Agreed Form between the
Borrower, the Project Account Banks, the Security Trustee, the Trust
Account Bank and the Bank of Ghana.
"FUNDED DEBT SERVICE" means, for any period, the amount in Dollars which
will be necessary in order to pay in full all principal and interest and
other amounts accruing in respect of Funded Indebtedness which (in the
case of all such principal, interest or other amounts) are scheduled to,
or otherwise are reasonably expected to, become due and payable during
that period.
"FUNDED INDEBTEDNESS" means, at any date, the sum of the Principal
Amount of all outstanding Loans denominated in Dollars at such date.
"FUTURE NET CASH FLOW" means, for any period, the remainder of:
(a) the Dollar equivalent (calculated at the date of determination
of Future Net Cash Flow) of:
(i) in the case of any Ounces which are covered by a Price
Protection Agreement in effect on the relevant date of
calculation, at the price for delivery of Gold specified
in such Price Protection Agreement (or, if no price
other than a floor price for delivery of Gold is
specified in such Price Protection Agreement, the
minimum price for the delivery of Gold referred to
therein); and
(ii) in the case of all other Ounces, the lesser of the
London Gold Price per Ounce on the date of determination
of Future Net Cash Flow and the average of the London
Gold Price per Ounce for the six months preceding the
date of determination of Future Net Cash Flow,
the excess of (x) the total estimated Ounces from Production
during such period as calculated from the Cash Flow Schedule,
less (y) the aggregate payments of Ounces or currency payable
during such period by way of production royalties calculated and
payable as a percentage of Gold produced and sold in connection
with the operation of the Mine,
less
(b) Project Costs for such period (excluding, however, Funded Debt
Service for such period).
"GAAP" is defined in Clause 1.6.
"GHANA" means the Republic of Ghana.
"GHANA ACCOUNT (CEDI)" is defined in Clause 3.1(b).
"GHANA ACCOUNT (DOLLARS)" is defined in Clause 3.1(a).
"GHANA INSURER" means any insurer operating in Ghana approved (prior to
the Discharge Date) by the Facility Agent or (thereafter) by the Royalty
Holder and which is a party to an Assignment of Reinsurance.
"GOLD" means gold bullion measured in fine ounces ▇▇▇▇ weight.
"GOVERNMENTAL AGENCY" means any supranational, national, federal, state,
provincial, regional, or local government or governmental department or
other entity charged with the administration, interpretation or
enforcement of any Applicable Law and shall include the Minerals
Commission of the Republic of Ghana and the Central Bank.
-8-
"GROSS CASH FLOW" means, for any Cash Flow Period, the amount calculated
in Dollars (without double counting) as the sum of:
(a) in the case of any Ounces produced during such Cash Flow Period
and which are covered by a Price Protection Agreement, the price
actually received for such Ounces under such Price Protection
Agreement, multiplied by the number of such Ounces; and
(b) for all other Ounces produced during such Cash Flow Period, the
actual price received for such Ounces multiplied by the number
of such Ounces.
"GROUP" means the Sponsor, its subsidiaries and subsidiary undertakings
and their subsidiaries and subsidiary undertakings and "GROUP MEMBER"
means any such entity.
"HAZARDOUS MATERIAL" means any pollutant, contaminant or hazardous,
dangerous or toxic chemical, material, substance or waste within the
meaning of any Environmental Law.
"HOLDING COMPANY" means (a), initially, the immediate holding company of
the Borrower from time to time; and (b) on and from the New Ownership
Date, Wasford.
"HOLDING COMPANY SECURITY AGREEMENT" means the Deed of Charge between
Wasford and the Security Trustee substantially in the Agreed Form.
"HOLDING COMPANY - BORROWER LOAN AGREEMENT" means the subordinated loan
agreement between the Borrower and Wasford in the Agreed Form.
"IMPERMISSIBLE QUALIFICATION" means, relative to the opinion or report
of any independent certified public accountant or any independent
chartered accountant as to any financial statement of any Obligor, any
qualification or exception to such opinion or report:
(a) which relates to such Obligor and its status as a "going
concern" or which is of a similar nature to the foregoing;
(b) which relates to any limited scope of examination of material
matters relevant to such financial statement; or
(c) which relates to the treatment or classification of any item in
such financial statement and which, as a condition to its
removal, would require an adjustment to such item the effect of
which would be to cause the Sponsor or the Borrower to be in
default of any of its respective obligations under Clause 5.1 or
the Sponsor shall be in breach of any similar clause of the
Support Agreement.
"INDEMNIFIED LIABILITIES" is defined in Clause 15.4.
"INDEMNIFIED PARTIES" is defined in Clause 15.4.
"INDEPENDENT ENGINEER" mean such independent mining consultant as is
retained by the Security Trustee on behalf of the Secured Creditors
after consulting with the Borrower and taking into account the
Borrower's reasonable views (without being bound by such views).
"INDEPENDENT ENGINEER'S CERTIFICATE" means a certificate duly executed
by an Authorised Representative of the Independent Engineer,
substantially in the Agreed Form.
"INSOLVENCY DEFAULT" means any (a) Event of Default of the nature
referred to in Clause 7.1(f), or (b) condition or event which, after
notice, lapse of time, the making of any required determination or any
combination of the foregoing, would constitute an Event of Default of
the nature referred to in Clause 7.1(f).
"INSTRUMENT" means any contract, agreement, indenture, mortgage,
document or writing (whether by formal agreement, letter or otherwise)
under which any obligation is evidenced, assumed, or
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undertaken, or any lien (or right or interest therein) is granted or
perfected or purported to be granted or perfected.
"INSURANCE CONSULTANT'S CERTIFICATE" means a certificate duly executed
by the Insurance Consultant substantially in the Agreed Form.
"INSURANCE CONSULTANT" means any Insurance Consultant of international
repute as shall be retained by the Security Trustee (acting on the
instructions of the Required Secured Parties) after consulting with the
Borrower.
"INSURANCE POLICIES" means each policy or contract of insurance entered
into by the Borrower or otherwise by any other person in connection with
the Project.
"INSURANCE SUMMARY" means the summary in the Agreed Form of the
insurance requirements of, and policies in effect for, the Project
prepared by the Insurance Consultant and in form and substance
satisfactory to the Finance Parties.
"INTEREST PERIOD" is defined in the Loan Agreement
"INVESTMENT" means all expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of shares or
indebtedness of, or for loans, advances, capital contributions or
transfers of property to, or in respect of any guarantees (or other
contingent obligations) or obligations of, any person.
"LAWDEB" is defined in Clause 17(a).
"LBMA" means the London Bullion Market Association and its successor
organisations.
"LENDERS" is defined in the Loan Agreement.
"LIABILITIES" means, with respect to any Obligor, all Obligations of
such Obligor now or hereafter due, owing or incurred to the Finance
Parties (or any of them) in whatsoever manner in any currency or
currencies whether present or future, actual or contingent, whether
incurred solely or jointly with any other person and whether as
principal or surety in each case under the Finance Documents (or any of
them) together with all interest accruing thereon and all costs, charges
and expenses incurred by any Finance Party, receiver or other insolvency
officer in connection therewith.
"LIBOR" has the same meaning as in the Loan Agreement; provided that
where LIBOR is to be determined in respect of Liability due to a person
other than a Lender or the Facility Agent, the reference to the "Agent"
in the definition of LIBOR in the Loan Agreement (and any defined term
used therein) shall instead be a reference to the Security Trustee.
"LOAN" is defined in the Loan Agreement.
"LOAN AGREEMENT" mean the Project Facility Agreement dated [o], 2002
between the Borrower, the Lenders and the Facility Agent.
"LOAN COVER RATIO" means, for any period, the ratio, expressed as a
percentage, of:
(a) Future Net Cash Flow for such period,
to
(b) Funded Debt Service in respect of the Loans for such period.
"LOAN LIFE RATIO" means, at any date, the ratio, expressed as a
percentage, of:
(a) the Present Value of Future Net Cash Flow for the period
commencing on such date and ending on the Final Maturity Date
for the Loans,
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to
(b) Funded Indebtedness in respect of the Loans at such date.
"LONDON GOLD FIXING" means a gold price fixing meeting among the members
for the time being of the London gold market.
"LONDON GOLD PRICE" means, on any day, the fixing price per Ounce (in
Dollars) as announced at the afternoon London Gold Fixing for such day;
provided, however, that if the afternoon London Gold Fixing shall not
have occurred for that day, the "LONDON GOLD PRICE" for such day shall
be the fixing price per Ounce (in Dollars) as announced at the morning
London Gold Fixing for such day or if the morning London Gold Fixing
shall not have occurred for such day, the "LONDON GOLD PRICE" for such
day shall be the publicly quoted price per Ounce (in Dollars) on such
other accessible international gold market (allowing for physical
delivery of such Gold) as may be reasonably selected by the Security
Trustee; and provided, further, however, that in the event the Security
Trustee shall have been unable to select any other such international
gold market, then the "LONDON GOLD PRICE" for such day shall mean such
price as the Security Trustee shall reasonably determine. In the event
that such day is not a Business Day, then the "London Gold Price" shall
be the London Gold Price on the immediately preceding Business Day.
"MANAGEMENT AGREEMENT" means the Management Agreement in respect of the
Project between the Manager and the Borrower in the Agreed Form.
"MANAGER" means the Sponsor (or such other person approved by the
Security Trustee) in its capacity as Manager under the Management
Agreement.
"MANAGER'S CONFIRMATION AND UNDERTAKING" means the Deed of Confirmation
and Undertaking between the Sponsor, the Security Trustee and the
Borrower in the Agreed Form.
"MARKET MAKER" means a person which, as principal, holds itself out as
consistently willing to enter into transactions for the purchase or sale
of Gold in the London Gold Market at prices for spot settlement
determined by it generally rather than in respect of each particular
transaction.
"MATERIAL AGREEMENT" means any Instrument which is or may be material to
any material aspect of the Project, and shall include any material
agreement for the construction, mining, financing or the management of
any aspect of the Project.
"MATERIAL ADVERSE DEVIATION" means, in respect of any Annual Budget, a
material adverse change in the production, income, cashflow, Funded Debt
Service, Project Capital Costs or Project Operating Costs of more than
25% during any rolling six monthly period of the period covered by such
Annual Budget.
"MATERIALLY ADVERSE EFFECT" means, with respect to any Obligor, an
effect, resulting from any occurrence of whatever nature (including any
adverse determination in any litigation, arbitration, employment dispute
or governmental or administrative investigation or proceeding), which is
materially adverse to the ability of such Obligor to make any payment
(of principal, interest, fees or otherwise) under any Finance Document
or to perform any other material obligation required under any Operative
Document to which it is or may become a party (including, any
obligations to develop, construct and operate the Project in accordance
with the Development Plan) or to grant and perfect the liens granted or
purported to be granted and perfected by such Obligor pursuant to any
Security Agreement or to such Obligor's consolidated financial
condition, business, operations or assets.
"MINE" means, collectively, all properties, assets or other rights,
whether real or personal, tangible or intangible, now owned or leased or
hereafter acquired by or for the benefit of the Borrower which assets
are used or intended for use in or forming part of the Project (and, for
the avoidance of doubt, shall include:
(a) the gold deposits located in the Lease Area (as defined in the
Mining Lease); and
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(b) all associated beneficiation facilities, together with all plant
sites, waste dumps, ore dumps, crushing circuits, abandoned
heaps, power supply systems and ancillary and infrastructure
facilities located at the Mine).
"MINE OUTPUT" means all products from the Mine, including dore and Gold.
"MINING CONTRACT" means the Instrument, to be entered between the Mining
Contractor and the Borrower, in relation to mining works at the Project
substantially in the Agreed Form.
"MINING CONTRACTOR" means any Mining Contractor approved in writing by
the Security Trustee acting on the instructions of the Required Secured
Parties (acting reasonably) and party to the Mining Contract.
"MINING CONTRACTOR'S CONFIRMATION AND UNDERTAKING" means the Deed of
Confirmation and Undertaking to be entered into by the Mining
Contractor, the Security Trustee and the Borrower substantially in the
Agreed Form.
"MINING LEASE" means the Mining Lease, dated September 17, 1992, between
the Government of Ghana and SGL (and assigned or to be assigned pursuant
to the Asset Sale Agreement dated March 1, 2002 to the Borrower)
together with all ancillary documents, annexes and consents relating
thereto provided to the Facility Agent.
"MINING RIGHTS" means all interests in the surface of any lands, the
minerals (being Gold and associated minerals) or that may be extracted
from any land, all royalty agreements, water rights, mining claims,
mineral leases, mining licenses, joint ventures and other leases,
rights-of-way, inurements, licenses and other rights and interests used
by or necessary to the Borrower to construct, develop and operate the
Mine.
"MONTHLY MINE REPORT" means a monthly report from the Borrower addressed
to the Lenders and each Royalty Holder relating to the development and
operation of the Project and delivered in either digital or paper form.
"NEW OWNERSHIP DATE" means:
(a) the first date upon which the Borrower becomes a subsidiary of a
direct holding company other than SGL; or
(b) such other date that the Borrower and the Security Trustee
(acting upon the instructions of all Secured Parties) agree is
the New Ownership Date.
"OBLIGATIONS" means, with respect to any Obligor, all obligations of
such Obligor with respect to the repayment or performance of all
obligations (monetary or otherwise) of such Obligor arising under or in
connection with this Agreement and each other Finance Document and where
the term "OBLIGATIONS" is used without specific reference to a
particular Obligor, such term means the Obligations of each Obligor.
"OBLIGORS" means, collectively, the Borrower, the Sponsor, any
Subordinated Creditor (other than, for the avoidance of doubt, the
Royalty Holder) party to any Subordination Agreement from time to time
and any person which accedes to this Agreement as an Additional Obligor
or whom the Borrower and the Security Trustee agree is an Obligor and
"OBLIGOR" means any of them.
"OBLIGOR DEED OF ACCESSION" means a deed of accession substantially in
the form of Schedule 3.
"OPERATING ACCOUNT" is defined in Clause 3.2(a).
"OPERATIVE DOCUMENTS" means, collectively, the Finance Documents and the
Project Documents.
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"ORGANIC DOCUMENT" means, with respect to each Obligor, its regulations,
other constitutional documents and any and all shareholder agreements,
voting trusts, and similar arrangements applicable to any of such
Obligor's authorised shares of capital stock or other equity interests.
"ORIGINAL LENDER" is defined in the Loan Agreement.
"OUNCE" means a fine ounce ▇▇▇▇ weight of gold bullion in a form readily
tradeable with members of the LBMA from time to time.
"PAYMENT CURRENCY" is defined in Clause 15.9(a)(i).
"PERMITTED DISTRIBUTION" means any payment made by the Borrower or the
Holding Company to another Obligor where:
(a) such payment is made on a Cash Sweep Date occurring after the
Economic Completion Date;
(b) such payment is not in excess of CFAD for the Cash Flow period
immediately preceding such Cash Sweep Date;
(c) all Obligations then due and outstanding have been paid;
(d) the Borrower has provided a Compliance Certificate dated as at
such Cash Sweep Date confirming (to the Security Trustee's
satisfaction) that all forward looking financial covenants in
the Finance Documents will continue to be met once such payment
is made; and
(e) no Default shall have occurred and none shall result from such
payment.
"PERMITTED EXPROPRIATION" means a single or series of compulsory
acquisitions by Ghana of not more than twenty two and twenty two one
hundredths of a per cent (22.22%) in aggregate of the Charged Shares in
the Borrower:
(a) which is in accordance with the Deed of Warranty; and
(b) the proceeds of which are:
(i) paid by Ghana in Dollars;
(ii) subject to the Holding Company Security Agreement;
(iii) advanced by way of an accounting entry by the Holding
Company to the Borrower as Subordinated Borrower
Intercompany Indebtedness pursuant to a loan agreement
in a form and substance acceptable to the Required
Secured Parties; and
(iv) actually paid directly to the Security Trustee for
application in accordance with Clause 12.15.
"PERMITTED LIEN" is defined in Clause 6.4.
"POTENTIAL EVENT OF DEFAULT" means any Event of Default or any condition
or event which, after notice, lapse of time, the making of any required
determination or any combination of the foregoing, would constitute an
Event of Default.
"PRESENT VALUE OF FUTURE NET CASH FLOW" means, for any period (a
"CALCULATION PERIOD"), the sum of the balance of the Debt Service
Accruals Account (at the relevant Calculation Date for such Present
Value of Future Net Cash Flow) plus the aggregate of discounted Future
Net Cash Flow for such Calculation Period calculated as set forth
herein. Each Calculation Period shall be divided into consecutive
periods (each a "DISCOUNT PERIOD") of three months (or, in the case of
the last such period, the period commencing on the last day of the
penultimate such period and ending on the last day of the Calculation
Period), and any Future Net Cash Flow scheduled to accrue during any
Discount Period
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shall be discounted at the Discount Rate as in effect on the date of
calculation of Present Value of Future Net Cash Flow to the first day of
such Calculation Period from the day which represents the end-point of
such Discount Period.
"PRICE PROTECTION PROJECT COSTS" is defined in Clause 5.11.
"PRICE PROTECTION AGREEMENTS" is defined in Clause 5.11.
"PRICE PROTECTION COUNTERPARTIES" is defined in Clause 5.11.
"PRICE PROTECTION OBLIGATIONS" means, with respect to any person, all
liabilities of such person under interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements, and all other
agreements, options or arrangements designed to protect such person
against fluctuations in interest rates, currency exchange rates or
precious metals prices (including any Price Protection Agreements).
"PRINCIPAL AMOUNT" means, with respect to any Loan outstanding (or to be
outstanding) at any date, the aggregate principal amount (calculated in
Dollars) of such Loan at such date.
"PROCESS AGENT" is defined in Clause 15.16.
"PRODUCTION" means, for any period, the number of ounces of Gold
contained in dore which have been produced, or (in the case of any
period or portion thereof to occur in the future) which are scheduled
(from the Economic Completion Date, in the Cash Flow Schedule) to be
produced, at the Mine during such period.
"PROJECT" means the construction, development and operation of the Mine
in accordance with the Development Plan.
"PROJECT ACCOUNT BANK (GHANA)" means such bank located in Accra as may
be appointed by the Borrower (with the consent of the Security Trustee)
with which the Project Accounts (Ghana) shall be maintained.
"PROJECT ACCOUNT BANK (U.K.)" means Standard Bank London Limited (or
such other bank located in London as may be appointed by the Borrower
(with the consent of the Security Trustee) with which the Project
Accounts (U.K.) shall be maintained).
"PROJECT ACCOUNT BANKS" means, collectively, the Project Account Bank
(Ghana), the Project Account Bank (U.K.), and the Trust Account Bank.
"PROJECT ACCOUNTS (GHANA)" means, collectively, the Ghana Account
(Cedis) and the Ghana Account (Dollars).
"PROJECT ACCOUNTS (U.K.)" means, collectively, the Operating Account,
the Trust Account and such other accounts as the Borrower and the
Security Trustee shall agree is a Project Account (U.K.).
"PROJECT ACCOUNTS" means, collectively, the Project Accounts (Ghana) and
the Project Accounts (U.K.).
"PROJECT ASSETS" means all properties, assets or other rights, whether
real or personal, tangible or intangible, now owned or hereafter
acquired by or for the benefit of the Borrower which are used or
intended for use in or forming part of the Mine, including all
properties, licenses, assets or other rights acquired by the Borrower
with the proceeds of any Loan.
"PROJECT CAPITAL COSTS" means, for any period, the aggregate of all
Capital Expenditures scheduled to be, or, as the case may be, actually
paid in accordance with the Approved Budget (or, in the case of any such
payment scheduled to be, or, as the case may be, actually paid after the
Economic Completion Date, in accordance with the Cash Flow Schedule) by
the Borrower during such period in respect of the Project.
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"PROJECT COSTS" means, for any period, the Project Operating Costs and
the Project Capital Costs for such period.
"PROJECT DOCUMENTS" means, collectively:
(a) the Mining Contract, the Management Agreement, the Refining and
Purchase Agreement, the Mining Lease, the Deed of Warranty, the
Foreign Exchange Retention Account Agreement and all related
Instruments, in each case in the form provided to the Facility
Agent in connection with its execution and delivery of the Loan
Agreement;
(b) all Price Protection Agreements not constituting Finance
Documents;
(c) all other Instruments (excluding any Finance Document) required
to be provided to the Facility Agent or Security Trustee
pursuant to Clause 5.2(p) in the form supplied pursuant to such
clause; and
(d) each other Instrument which the Borrower and the Security
Trustee agree is a Project Document.
"PROJECT ENGINEERING CONTRACT" means the Instrument, to be entered
between the Project Engineer and the Borrower, in relation to the
feasibility study, construction and commissioning works at the Project
substantially in the Agreed Form.
"PROJECT ENGINEER" means Metallurgical Design and Management Pty Ltd, in
cooperation with SRK Limited, and Knight Piesold Pty Ltd, or such other
project engineering contractor approved in writing by the Security
Trustee acting on the instructions of the Required Secured Parties
(acting reasonably) and party to the Project Engineering Contract.
"PROJECT ENGINEER'S CONFIRMATION AND UNDERTAKING" means the Deed of
Confirmation and Undertaking to be entered into by the Project Engineer,
the Security Trustee and the Borrower substantially in the Agreed Form.
"PROJECT LIFE RATIO" means, at any date, the ratio, expressed as a
percentage, of:
(a) Present Value of Future Net Cash Flow for the period commencing
on such date and ending on the last day of the Project Period,
to
(b) Funded Indebtedness in respect of each Loan at such date.
"PROJECT OPERATING COSTS" means, for any period, the aggregate of all
payments scheduled to be, or, as the case may be, actually paid by the
Borrower to any person (excluding, however, any payment to any affiliate
of the Borrower other than payments to the Sponsor in respect of
management fees pursuant to the Management Agreement permitted to be
made by the Borrower pursuant to Clause 6.7(d)) during such period in
accordance with the Cash Flow Schedule (or, in the case of any such
payment scheduled to be, or, as the case may be, actually paid prior to
the Economic Completion Date, the Approved Budget) together with any
applicable profit, income, property and other taxes or royalties imposed
by any Governmental Agency scheduled to be, or, as the case may be,
actually paid, during such period, in each such case to the extent that
such payments are scheduled to be paid in connection with the operation
of the Mine, including:
(a) the cash costs scheduled to be, or, as the case may be, actually
paid, in accordance with the Cash Flow Schedule during such
period in connection with the operation, maintenance and
reclamation of the Mine in order to mine, mill, ▇▇▇▇▇, refine
and/or deliver Project Output for sale (including payments to the
Sponsor under the Management Agreement);
(b) Funded Debt Service for such period and net payments for such
period in respect of Price Protection Obligations;
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(c) any royalty payments scheduled to be, or, as the case may be
actually, made in respect of any Royalty Agreements; and
(d) any Representative Liabilities.
"PROJECT OUTPUT" means all products from the Mine.
"PROJECT PARTY" means each Obligor and each Contractor and any of their
respective affiliates, representatives, advisers (excluding legal
advisers and other similar professional advisers not actually engaged in
the construction, development, operation or maintenance of the Mine),
consultants, officers, directors or other associates of any such person
retained, employed or consulted by such person in connection with the
consummation of the Project or the operation of the Mine.
"PROJECT PERIOD" means the period commencing on the Effective Date and
continuing until the date on which the Proven and Probable Reserves have
been extracted, milled, refined and sold in accordance with the
Development Plan.
"PROJECT SITE" means the site located near Akyempin in the Western
Region of Ghana which is subject to the Mining Lease.
"PROVEN AND PROBABLE RESERVES" means (a) initially, 600,000 Ounces, less
the amount of Ounces mined and shipped and in respect of which a royalty
has been paid in compliance with each Royalty Agreement (provided that
nothing in this paragraph (a) shall be construed as a representation by
the Borrower that the actual proven and probable reserves as at the date
hereof are 600,000 Ounces; and (b) thereafter, the amount of reserve
Ounces established pursuant to Clause 2.5 to be the reserves of Ounces
at the Mine, determined and calculated as set forth in the Development
Plan (or the most recent amendment thereto) (or, to the extent not set
forth therein, to the reasonable satisfaction of the Independent
Engineer) and in accordance with the standards of Canada's National
Instrument NI 43-101 less the amount of Ounces mined and shipped since
the effective date of such Development Plan (or, if amended from time to
time, since the last such amendment) and in respect of which a royalty
has been paid in compliance with each Royalty Agreement.
"RECEIVER" means any receiver or manager appointed over all or any
property of any Obligor.
"RECOVERY RATE" means the factor determined in the Development Plan (or
the historical rate, if higher) to account for the efficiency of the
mining and processing operations and used to estimate the Ounces to be
produced and shipped from the Mine.
"REFINER" means, initially ▇▇▇▇▇▇▇ Matthey PLC, and thereafter Societe
Generale or such other person who the Borrower and the Security Trustee
shall agree from time to time is the Refiner.
"REFINER'S CONFIRMATION AND UNDERTAKING" means the Deed of Confirmation
and Undertaking between the Refiner, the Security Trustee and the
Borrower substantially in the Agreed Form.
"REFINING AND PURCHASE AGREEMENT" means: (a) the refining agreement
between the Borrower and the Refiner relating to the Project,
substantially in the Agreed Form, or (b) any other Instrument which the
Borrower and the Security Trustee agree is the Refining and Purchase
Agreement.
"RELEASE DATE" means the first date upon which each of the following
shall have occurred on such date:
(a) a Development Plan having been delivered and become effective
pursuant to Clause 2.3;
(b) Economic Completion Date shall have occurred;
(c) the Finance Documents shall have been amended to include any
covenants (including, without limitation in respect of minimum
Loan Life Ratio, minimum Loan Cover Ratio, Minimum Project Life
Ratio, minimum Reserve Value Ratios, maintenance of Proven and
Probable Reserves, minimum account balances, and project account
agreements) agreed by the Secured Parties and the Borrowers in
respect of the period after Economic Completion; provided that,
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for the avoidance of doubt, if no agreement is reached pursuant
to this paragraph (c), then the Release Date shall not have
occurred; and
(d) no Default shall have occurred and be subsisting.
"RELEVANT CURRENCY" is defined in Clause 15.9(a)(i).
"REPEATING REPRESENTATION" means the representations set out in Clause 4
and any other representation which any Obligor and the Security Trustee
agree is a Repeating Representation.
"REPAYMENT DATE" means each Facility A Loan Repayment Date and Facility
B Loan Repayment Date as each such term is defined in the Loan
Agreement.
"REPRESENTATIVES" means, collectively, the Facility Agent and the
Security Trustee and "Representative" shall be construed accordingly.
"REPRESENTATIVES LIABILITIES" means, collectively, Facility Agent
Liabilities and Security Trustee Liabilities.
"REQUIRED CAPITAL EXPENDITURES" means those bona fide Project Capital
Costs which the Security Trustee acting on the instructions of the
Required Secured Parties (acting reasonably and in consultation with the
Independent Engineer) determines are required to operate, manage and
maintain the Mine in normal working condition.
"REQUIRED COMPLETION EXPENDITURES" means those bona fide Project Costs
details of which are confirmed to the Borrower by the Independent
Engineer, and which the Security Trustee acting on the instructions of
the Required Secured Parties (acting in consultation with the
Independent Engineer) determines are required to achieve Economic
Completion.
"REQUIRED LENDERS" is defined in the Loan Agreement.
"REQUIRED PRICE PROTECTION PERIOD" means, at any date on and from
Economic Completion the period commencing on that date and ending on the
date forecast by the then effective Development Plan to be the Discharge
Date.
"REQUIRED SECURED PARTIES" means Secured Parties having, in the
aggregate, a Voting Entitlement of more than 66 2/3%.
"REQUIREMENT OF LAW" means, as to any person, its Organic Documents and
any Applicable Law or Contractual Obligation binding on or applying to
such person.
"RESERVE VALUE COVER RATIO" means, on any date, the ratio (expressed as
a percentage), of:
(a) the product of:
(i) the Proven and Probable Reserves on that date multiplied
by,
(ii) the lower of U.S.$280.00 and the average London Gold
Price for the preceding 6 months.
to
(b) Funded Indebtedness in respect of the Loans on such date.
"RIGHTS OF SET OFF" means from time to time, in relation to a creditor,
every right (whether conferred by law or otherwise) which that creditor
or any one or more of its subsidiaries has to combine or net credit
balances and debit balances, directly or indirectly, being balances
which belong to any Obligor, or are owing by any Obligor to, or are
deposits by any Obligor with, that creditor or any one or more of its
subsidiaries.
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"ROYALTY AGREEMENTS" means the First Royalty Agreement and any other
Instrument which the Security Trustee and the Borrower agree is a
Royalty Agreement.
"ROYALTY HOLDER" is defined in the preamble.
"ROYALTY HOLDER DEED OF ACCESSION" means a deed of accession
substantially in the form of Schedule 4.
"ROYALTY PRINCIPAL AMOUNT" means, as at any date: (a) the amount of
liquidated damages that would have been payable on such date pursuant to
Clause 6.1 of the First Royalty Agreement (assuming an Event of Default
had occurred and the Royalty Holder had exercised its right to demand
payment pursuant to Clause 6.1 of the First Royalty Agreement); and (b)
the amount of liquidated damages that would have been payable on such
date pursuant to any provision of any other Royalty Agreement which is
substantially Clause 6.1 of the First Royalty Agreement (assuming an
Event of Default had occurred and the Royalty Holder had exercised its
right to demand payment pursuant to such provision of such Royalty
Agreement)
"SECURED PARTIES" means each Lender and each Royalty Holder.
"SECURITY AGREEMENTS" means, collectively, the Contractors'
Undertakings, the Borrower Security Agreements, the Share Security
Agreements, the Assignments of Reinsurances, all Instruments delivered
pursuant to any provision thereof and any other Instrument which any
Obligor and the Security Trustee agree is a Security Agreement.
"SECURITY DOCUMENT" is defined in Clause 12.1.
"SECURITY TRUST PROPERTY" means all right, title and interest of the
Security Trustee under or in any of the Security Documents (other than
rights held only for its own account).
"SECURITY TRUSTEE" is defined in the preamble.
"SECURITY TRUSTEE DEED OF ACCESSION" means a deed of accession
substantially in the form of Schedule 2.
"SECURITY TRUSTEE INDEMNIFIED LIABILITIES" is defined in Clause
12.39(d).
"SECURITY TRUSTEE LIABILITIES" means any Liabilities due, owing or
incurred to the Security Trustee (other than in respect of any
Liabilities due, owing or incurred to a Secured Party, including in
respect of any covenant to pay Liabilities due to such Secured Party) by
any Obligor.
"SELECTION NOTICE" is defined in the Loan Agreement.
"SGL" means Satellite Goldfields Limited, a company incorporated under
the laws of Ghana.
"SHARE SECURITY AGREEMENTS" means the Caystar Holdings Security
Agreement, the Holding Company Security Agreement and any other
Instrument which any Obligor and the Security Trustee agree is a Share
Security Agreement.
"SHAREHOLDERS EQUITY" means the aggregate (as of the relevant date for
calculation) of:
(a) the amount paid in on the Borrower's ordinary share capital and
on non-redeemable preference share capital;
(b) the aggregate amount standing to the credit of the reserves of
the Borrower (including any share premium account, capital
redemption reserve fund, any credit balance on profit and loss
account, any reserves on revaluation of assets and any other sum
which by standard accounting practice generally accepted in the
United Kingdom is treated as part of equity); and
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(c) the amount of any long-term loan made by any holding company or
shareholder of the Borrower no part of which is repayable or
capable of becoming repayable prior to the Discharge Date,
but after deducting from such aggregate amount:
(x) any amounts set aside for dividends
permitted under this Agreement or Taxation
(including deferred Taxation) payable by the
Borrower or attributable to goodwill or
other intangible assets; and
(y) any debit balance on the profit and loss
account of the Borrower (except to the
extent that a deduction in respect of such
debit balance has already been made in
calculating Shareholders' Equity).
"SPONSOR" means Golden Star Resources Ltd.
"STANDARD BANK" means Standard Bank London Limited.
"SUBORDINATED CREDITOR" means any person party to a Subordination
Agreement as a subordinated creditor.
"SUBORDINATED NOTE" means the U.S.$15,000,000 subordinated note issued
by the Borrower to The Law Debenture Trust Corporation p.l.c. and to be
transferred to the Holding Company pursuant to the Share Sale Agreement.
"SUBORDINATION AGREEMENT" means:
(a) the subordination agreement between the Borrower, the Security
Trustee, and each other Obligor party thereto from time to time
substantially in the Agreed Form; or
(b) any other Instrument which the Security Trustee and the Borrower
agree is a Subordination Agreement.
"SUPPORT AGREEMENT" means the agreement between the Security Trustee and
the Sponsor substantially in the Agreed Form.
"TAX CREDIT" is defined in Clause 15.6.
"TAX PAYMENT" is defined in Clause 15.6.
"TAXATION" means the incurrence of a Tax.
"TAXES" is defined in Clause 15.5(a).
"TECHNICAL REVIEW" means the project audit, containing a review of the
technical aspects of the Project (including a review of the Feasibility
Study), to be prepared by the Independent Engineer in connection with
the implementation of this Agreement and, for the purposes of Clause
4.18(c) only, approved by the Security Trustee acting on the
instructions of the Secured Parties (acting reasonably).
"TRUST ACCOUNT" means the Dollar account of the Borrower established by
the Trust Account Bank pursuant to the Foreign Exchange Retention
Account Agreement.
"TRUST ACCOUNT BANK" means Stanbic of Ghana Limited (or such other bank
located in London as may be appointed pursuant to the Foreign Exchange
Retention Account Agreement and with which the Trust Account shall be
maintained).
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"UNITED STATES" or "U.S." means the United States of America, each of
its states and the District of Columbia.
"UTILISATION DATE" is defined in the Loan Agreement.
"UTILISATION REQUEST" is defined in the Loan Agreement.
"VOTING ENTITLEMENT" is defined in Clause 8.2.
"WASFORD" means Wasford Holdings, a company incorporated under the laws
of the Cayman Islands.
"WORLD BANK ENVIRONMENTAL AND SAFETY GUIDELINES" means the World Bank
Environmental and Safety Guidelines for Open Pit Mining.
1.2 ADDITIONAL DEFINITIONS
Any reference in this Agreement or any other Finance Document to:
(a) an "AFFILIATE" of any person is a reference to a subsidiary or a
holding company, or a subsidiary of a holding company, of such
person;
(b) references to the "BORROWER", the "FACILITY AGENT", the "HOLDING
COMPANY", "LENDER", "OBLIGOR", "RECEIVER", the "ROYALTY HOLDER",
the "SECURITY TRUSTEE", or the "SPONSOR" shall be construed so
as to include their respective successors and permitted
transferees and assigns in accordance with their respective
interests and any references to any obligation of, in the case
of this Agreement only, the Holding Company or any other Obligor
(other than Golden Star Resources Ltd., which, for the avoidance
of doubt is not intended to be a party to this Agreement but is
intended to be an Obligor for all purposes of this Agreement
including, without limitation clause 7) shall only apply upon
the Holding Company or such other Obligor (as the case may be)
becoming party to this Agreement;
(c) "CONTROL" means the power of one person to:
(i) vote more than fifty percent (50%) of the issued share
capital of a second person or the voting power in such
second person; or
(ii) direct the management, business or policies of such
second person, whether by contract or otherwise;
(d) "FINANCIAL INDEBTEDNESS" shall be construed as a reference to
any indebtedness for or in respect of moneys borrowed or raised
by whatever means (including by means of acceptances under any
acceptance credit facility, the issue of loan stock, any
liability in respect of Capital Leases and any obligations
evidenced by bonds, notes, debentures or similar instruments) or
for the deferred purchase price of assets or services (excluding
normal trade debt which does not include any interest payment or
finance charge) or any other transaction having the commercial
effect of a borrowing; provided, however, that any interest,
commission, fees or other like financing charges shall be
excluded save to the extent that the same has been capitalised;
(e) a "GUARANTEE" includes a standby letter of credit, an indemnity
and any other obligation (howsoever called) of any person to
pay, purchase or provide funds (whether by the advance of money,
the purchase of or subscription for shares or other securities,
the purchase of assets or services or otherwise) for the payment
of or to assist in or provide means of discharging or otherwise
be responsible for, any indebtedness of, or the solvency of any
other person;
(f) "GUARANTEED INDEBTEDNESS" means, with respect to any person, all
indebtedness of such person in respect of guarantees or other
similar assurances against loss given by such person in respect
of the indebtedness of other persons;
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(g) a "HOLDING COMPANY" of a company or corporation shall be
construed as a reference to any company or corporation of which
the first-mentioned company or corporation is a subsidiary;
(h) "INDEBTEDNESS" shall be construed so as to include any
obligation (whether incurred as principal or as surety) for the
payment or repayment of money, whether present or future, actual
or contingent;
(i) a "LIEN" means any mortgage, charge, pledge, hypothecation,
assignment by way of security, deposit arrangement, encumbrance,
lien (statutory or otherwise), title retention, finance lease,
factoring or discounting of debts or other security interest on
or over present or future assets of the person concerned
securing any obligation of any person or any other type of
preferential or trust arrangement having a similar effect,
including any such security interest which arises or is imposed
by operation of law;
(j) a "MONTH" is a reference to a period starting on one day in a
calendar month and ending on the numerically corresponding day
in the next calendar month save that, where any such period
would otherwise end on a day which is not a Business Day, it
shall end on the next Business Day, unless that day falls in the
calendar month succeeding that in which it would otherwise have
ended, in which case it shall end on the preceding Business Day;
provided, however, that, if a period starts on the last Business
Day in a calendar month or if there is no numerically
corresponding day in the month in which that period ends, that
period shall end on the last Business Day in that later month
(and references to "months" shall be construed accordingly);
(k) a "PERSON" means any natural person, corporation, partnership,
firm, association, trust, government, governmental agency or any
other entity, whether acting in an individual, fiduciary or
other capacity;
(l) a "QUARTER" means each three month period beginning in any year,
on each of 1st January, 1st April, 1st July, 1st October or, if
any such date is not a Business Day, the immediately preceding
Business Day;
(m) a "SUBSIDIARY" of a company or corporation shall be construed as
a reference to any company or corporation:
(i) which is controlled, directly or indirectly, by the
first mentioned company or corporation;
(ii) more than half the issued share capital of which is
beneficially owned, directly or indirectly, by the
first-mentioned company or corporation; or
(iii) which is a subsidiary of another subsidiary of the first
mentioned company or corporation;
(n) a "SUBSIDIARY UNDERTAKING" shall have the same meaning as in the
Companies ▇▇▇ ▇▇▇▇; and
(o) the "WINDING-UP" or "DISSOLUTION" of a company or the
appointment of an "ADMINISTRATIVE RECEIVER", a "RECEIVER",
"MANAGER", "LIQUIDATOR" or an "ADMINISTRATOR" with respect to a
company shall be construed so as to include any equivalent or
analogous proceedings or, as the case may be, person under the
law of the jurisdiction in which such company is incorporated or
any jurisdiction in which such company carries on business.
1.3 INTERPRETATION
Unless a clear contrary intention appears, this Agreement and each other
Finance Document shall be construed and interpreted in accordance with
the provisions set forth below:
(a) reference to any Instrument (including any other Finance
Document), or document (including the Annual Budget, the
Approved Budget, Cash Flow Schedule, Development Plan, Financial
Model and Insurance Summary) means such Instrument or document
as amended,
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supplemented, novated, refinanced, replaced, waived, restated or
modified, and in effect from time to time in accordance with the
terms thereof and, if applicable, the terms hereof;
(b) reference to any Applicable Law means such Applicable Law as
amended, modified, codified or reenacted, in whole or in part,
and in effect from time to time, including rules and regulations
promulgated thereunder;
(c) a reference to a time of day shall be construed as a reference
to London time;
(d) "INCLUDING" (and with correlative meaning "INCLUDE") means
including without limiting the generality of any description
preceding such term;
(e) the singular number includes the plural number and vice versa;
(f) reference to any person includes such person's successors,
substitutes and assigns but, if applicable, only if such
successors, substitutes and assigns are permitted by this
Agreement or such other Finance Document, and reference to a
person in a particular capacity excludes such person in any
other capacity or individually;
(g) reference to any gender includes any other gender;
(h) "HEREUNDER", "HEREOF", "HERETO", "HEREIN" and words of similar
import shall be deemed references to this Agreement or such
other Finance Document, as the case may be, as a whole and not
to any particular clause or other provision hereof or thereof;
(i) relative to the determination of any period of time, "FROM"
means "FROM (AND INCLUDING)" and "TO" means "TO (BUT
EXCLUDING)";
(j) a reference to a "CORPORATION" or "COMPANY" shall be construed
as a reference to the analogous form of business entity used in
any relevant jurisdiction;
(k) when an expression is defined, another part of speech or
grammatical form of that expression has a corresponding meaning;
and
(l) a reference to fees, costs, charges or expenses includes all
value added tax or other applicable taxes imposed thereon.
1.4 USE OF DEFINED TERMS
Unless otherwise defined or the context otherwise requires, terms for
which meanings are provided in this Agreement and each Finance Document
shall have such meanings when used in the Insurance Summary, each
Utilisation Request, each Selection Notice, each Compliance Certificate,
each other Finance Document and each notice and other communication
delivered from time to time in connection with this Agreement or any
other Finance Document.
1.5 CROSS-REFERENCES
Unless otherwise specified, references in this Agreement and in each
other Finance Document to any Clause or Schedule are references to such
Clause or Schedule of this Agreement or such other Finance Document, as
the case may be, and unless otherwise specified, references in any
Clause, or definition to any clause are references to such clause of
such Clause, or definition.
1.6 ACCOUNTING AND FINANCIAL DETERMINATIONS
All accounting terms used herein or in any other Finance Document shall
be interpreted, all accounting determinations and computations hereunder
or thereunder shall be made, and all financial statements required to be
delivered hereunder or thereunder shall be prepared in accordance with,
generally accepted accounting principles in Canada ("GAAP"), in each
case, applied (subject to the provisions of
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Clause 1.7) on a basis consistent with the preparation of the financial
statements referred to in Clause 5.2(a).
1.7 CHANGE IN ACCOUNTING PRINCIPLES
If, after the Effective Date, there shall (without prejudice to Clause
1.6 and Clause 5.2(b)(ii)) be any change to any Obligor's Fiscal Year,
or in the application of the accounting principles used in the
preparation of the financial statements referred to in Clause 4.6 as a
result of the promulgation of rules, regulations, pronouncements, or
opinions issued by the governing or similar body of the independent
certified public or chartered accountants with responsibility for
preparing the audited accounts of the Sponsor and its subsidiaries from
time to time which changes result in a change in the method of
calculation of financial covenants, standards, or terms applicable to
such Obligor found in this Agreement or any other Finance Document, the
parties hereto agree promptly to enter into negotiations in order to
amend such financial covenants, standards or terms so as to reflect
equitably such changes with the desired result that the evaluation of
such Obligor's financial condition shall be the same after such changes
as if such changes had not been made; provided, however, that until all
Secured Parties have given their consent to such amendments, such
Obligor's financial condition shall continue to be evaluated on the same
principles as those used in the preparation of the financial statements
referred to in Clause 4.6.
1.8 GENERAL PROVISIONS AS TO CERTIFICATES AND OPINIONS, ETC.
Whenever the delivery of a certificate is a condition precedent to the
taking of any action by any Finance Party or the occurrence of any event
hereunder, the truth and accuracy of the facts and the diligent and good
faith determination of the opinions stated in such certificate shall in
each case be conditions precedent to the right of any Obligor to have
such action taken, and any certificate executed by any Obligor shall be
deemed to represent and warrant that the facts stated in such
certificate are true and accurate.
2. DEVELOPMENT OF PROJECT
2.1 BUDGETS
(a) The Borrower shall submit to the Security Trustee, the Facility
Agent, each Royalty Holder and the Independent Engineer:
(i) prior to the New Ownership Date; and
(ii) not later than 30 days after the beginning of any
subsequent 12 consecutive monthly period after the end
of any Annual Budget (including the Supplemental Annual
Budget referred to below),
an annual budget which shall set out the proposed Production for
12 monthly period commencing with such calendar month and the
proposed Project Costs that it shall incur in such 12 monthly
period, provided that the Borrower may in January 2003 submit a
supplemental annual budget for the 12 month period running from
January 1, 2003 to December 31, 2003.
(b) Within 10 days of receipt of any such budget, the Security
Trustee shall advise the Borrower if the Required Secured
Parties have approved such annual budget and if any amendments
to such annual budget are required by the Independent Engineer
or the Security Trustee. If within such 10 day period the
Security Trustee does not advise the Borrower of any amendments
required to such annual budget, then such annual budget shall be
deemed approved by the Required Secured Parties. If the Security
Trustee or the Independent Engineer makes any amendments to any
proposed annual budget, the Borrower shall incorporate such
amendment into such annual budget and any such decision of the
Security Trustee or the Independent Engineer shall be conclusive
and binding. Upon being approved (including with any amendment
required pursuant to this clause (b)), such annual budget shall
be the Annual Budget for such 12 month period for the purpose of
this Agreement.
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(c) Prior to the Release Date, the Borrower shall not, during any
period for which an Annual Budget applies, enter into any
transaction or permit to exist any Material Adverse Deviation
from such Annual Budget.
(d) Upon Economic Completion, the Approved Budget shall be deemed to
be the Annual Budget.
2.2 PROJECT DOCUMENTS
The Borrower shall as soon as is practicable and in any event, prior to
the Economic Completion Date:
(a) procure that the Project Engineer or such other duly qualified
firm (acceptable to each Lender) shall provide a new
Environmental Impact Statement in form and substance
satisfactory to each Lender and providing a report on the
environmental impact of the Project and the development and
operation of any proposed gold processing plant at the Project;
and
(b) procure that the Project Engineer shall provide a new
feasibility study in form and substance satisfactory to each
Lender and providing a report on the feasibility of redeveloping
the Project, including by way of the use of a gold processing
plant.
2.3 PRODUCTION OF DEVELOPMENT PLAN
(a) The Borrower shall as soon as reasonably practical and no later
than 60 days after receipt of the feasibility study referred to
in Clause 2.2(b) give to the Lenders and each Royalty Holder a
proposed Development Plan including a detailed financial model
(the "FINANCIAL MODEL") with (A) a cash flow schedule for the
Project (including a line item of Project Operating Costs per
Ounce for each period which covers a Cash Flow Period) (the
"CASH FLOW SCHEDULE"), (B) a "Financial Model Summary of Capital
Expenditure" attached to it and setting forth for (x) each
monthly period during the first twelve months from the effective
date of the Development Plan, (y) each quarterly period for the
subsequent year and (z) each annual period thereafter for the
remainder of the Project Period, amongst other things:
(i) the cash flows expected to be generated including Future
Net Cash Flows of, and containing other financial and
operation date relating to the Project;
(ii) expected Funded Debt Service;
(iii) expected Present Value of Future Net Cash Flow;
(iv) expected Project Capital Costs;
(v) expected Project Operating Costs;
(vi) expected Project Life Ratio;
(vii) expected Reserve Value Cover Ratio;
(viii) a Schedule of Capital Costs;
(ix) expected Proven and Probable Reserves; and
(x) expected Recovery Rate.
together with (C) details of the future development of the
Project, (D) the forecast Discharge Date, and (E) such other
information or data as is reasonably requested by any Finance
Party.
(b) In the event that, within 7 Business Days of the receipt of the
details of the proposed Development Plan provided pursuant to
Clause 2.3(a), the Secured Parties reasonably determine that
such proposed Development Plan is not satisfactory or would, or
would reasonably be likely to, affect adversely any of (i) the
Borrower's ability to comply with its
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obligations under any financial covenants under any Finance
Documents, (ii) the availability of funds to consummate the
Project or the availability of funds to operate the Mine, or
(iii) the ability to repay the Obligations of the Loans (assuming
all Commitments on the date hereof are at such time fully
utilised) in full by the Final Maturity Date, or meets its
obligations pursuant to the Royalty Agreements, such proposed
Development Plan shall be not effective.
(c) If the Secured Parties do not agree to any such proposed
Development Plan, the Secured Parties shall notify the Borrower
within 7 Business Days of receipt of the relevant request from
the Borrower, giving the reasons for such disagreement. If the
Borrower and the Secured Parties cannot resolve the matter within
15 Business Days of such notice from the Secured Parties, the
matter shall be referred, at the cost of the Borrower, for
determination by an Expert who, acting as an expert and not an
arbitrator, shall determine if the proposed Development Plan is
reasonable and satisfactory and meets the factors set forth in
Clause 2.3(b)(i) through (iii).
(d) If the Secured Parties do not agree to any proposed Development
Plan or an Expert does not agree that a proposed Development Plan
is reasonable and satisfactory and meets the factors set forth in
Clause 2.1(b)(i) through (iii), the Borrower shall submit to the
Secured Parties a further Development Plan pursuant to Clause
2.3(a).
(e) As a condition precedent to the effectiveness of any Development
Plan proposed by it, the Borrower will deliver to the Facility
Agent (with sufficient copies for each Secured Party) and each
Royalty Holder a certificate calculated as of the effective date
of such initial Development Plan indicating that no Default
would, or would be likely to, occur at any time as a result of
such initial Development Plan, together with such information
concerning the calculations and assumptions used by the Borrower
in preparing such certificate as any Secured Party shall have
requested.
(f) On the Development Plan being agreed by the Secured Parties or
deemed reasonable by the expert pursuant to Clause 2.3(c) and
upon it becoming effective, the Secured Parties shall consider
any reasonable request by the Borrower to change the repayment
profile of the Facilities to reflect the production profile of
the Mine contained in such Development Plan.
2.4 PROJECT DETERMINATIONS, ETC.
(a) All financial determinations and calculations relating to the
Project (excluding Excess Cash Flow which shall be calculated by
the Facility Agent as set forth in the definition thereof) after
the effectiveness of the initial Development Plan shall be:
(i) in the case of any such projected determination or
calculation, made in accordance with the Development
Plan, (after taking into account any Price Protection
Agreement then in effect); and
(ii) calculated to the reasonable satisfaction of the
Security Trustee;
provided, however, that during any period:
(A) occurring prior to the deemed effectiveness of
any relevant modification of the Development
Plan pursuant to Clause 2.5(a), all
determinations and calculations referred to in
this clause shall be determined in accordance
with the Development Plan as in effect prior to
the date of such deemed effectiveness; or
(B) occurring after the date of any determination
made by the Secured Parties pursuant to Clause
2.5(c) and prior to the approval of any relevant
modification or supplement to the Development
Plan by all the Secured Parties pursuant to such
clause, all determinations and calculations
referred to in this clause shall be determined
to the reasonable satisfaction of the Secured
Parties.
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(b) All determinations and calculations to be made in accordance
with the Cash Flow Schedule by reference to a specified period
shall, in the event such period does not appear in the Cash Flow
Schedule, be determined or calculated on a pro rata basis for
such specified period from the actual periods referred to in the
Cash Flow Schedule.
(c) All determinations and calculations to be made prior to the
effectiveness of the initial Development Plan shall be made:
(i) in accordance with the standards and guidance set forth
in GAAP or,
(ii) if GAAP does not (in the opinion of the Security
Trustee) provide sufficient guidance as to such
determination or calculations then such determinations
or calculations, in the manner determined by the
Security Trustee.
2.5 CHANGES TO DEVELOPMENT PLAN OR PROVEN AND PROBABLE RESERVES
(a) The Borrower shall give prompt notice to the Lenders (through
the Facility Agent) and each Royalty Holder of any change in any
fact, event or circumstance which renders the Development Plan
as then currently in effect materially inaccurate, including any
change in:
(i) the cash flows expected in connection with the Project
due to any delay in the construction of the Mine
(including any proposed carbon in ▇▇▇▇▇ plant) or any
interruption to the operation of the Mine in respect of
which an Obligor has received proceeds from any delay in
start-up or business interruption policy of insurance,
as the case may be;
(ii) the likely future development of the Project arising as
a result of any tests conducted in connection with the
achievement of Economic Completion; or
(iii) the Proven and Probable Reserves
and shall work in consultation with the Independent Engineer in
determining what modifications might be necessary to be made to
the Development Plan so as to render the same accurate.
(b) The Borrower shall deliver to the Lenders (through the Facility
Agent) and each Royalty Holder details as to any such proposed
modification no later than 15 Business Days after the occurrence
of any such change, etc., and shall deliver to each Lender
(through the Facility Agent) and each Royalty Holder a copy of
the Development Plan as proposed to be modified following the
effectiveness of such proposed modification. Unless the
circumstances described in Clauses (b) or (c) apply, the
Development Plan shall be deemed amended by such modification
with immediate effect from the receipt of the notice of
modification described in the previous sentence.
(c) In the event that, within 15 Business Days of the receipt of the
details of any proposed modification to the Development Plan
pursuant to Clause 2.5(a), the Lenders or any Royalty Holder
reasonably determine that such proposed modification is not
responsive to the relevant change in fact, event or circumstance
or would, or would reasonably be likely to, affect adversely any
of (i) the Borrower's ability to comply with its obligations
under Clause [o], or (ii) the availability of funds to
consummate the Project or the availability of funds to operate
the Mine in accordance with the Development Plan as then
currently in effect, or any Royalty Holder does not accept any
change to the Proven and Probable Reserves, no such modification
or supplement, shall (A) prior to the Discharge Date be
effective unless and until approved by each Lender and each
Royalty Holder, and (B) on and after the Discharge Date, shall
be effective unless and until approved by each Royalty Holder.
(d) If the Required Secured Parties do not agree to any such
proposed change to the Development Plan, the Security Trustee
shall notify the Borrower within 15 Business Days of receipt of
the relevant request from the Borrower, giving the reasons for
such disagreement. If the Borrower and the Security Trustee
(acting on the instructions of all Secured Parties) cannot
resolve the
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matter within 15 Business Days of such notice from the Security
Trustee, the matter shall be referred, at the cost of the
Borrower, for determination by an Expert who, acting as an
expert and not an arbitrator, shall determine the extent to
which the proposed amendments are reasonable. To the extent the
Expert does determine such amendments to be reasonable, it shall
also deliver an audit review to confirm that such amendments,
once incorporated into the Development Plan, have been properly
so incorporated. The Expert's determination and audit review
shall be final and binding on all parties.
(e) If any Secured Party believes there has been any change in any
fact, event or circumstance which renders the Development Plan
as then currently in effect materially inaccurate, including any
change in:
(i) the cash flows expected in connection with the Project
due to any delay in the construction of the Mine
(including any proposed carbon in ▇▇▇▇▇ plant) or any
interruption to the operation of the Mine in respect of
which an Obligor has received proceeds from any delay in
start-up or business interruption policy of insurance,
as the case may be;
(ii) the likely future development of the Project arising as
a result of any tests conducted in connection with the
achievement of Economic Completion; or
(iii) the Proven and Probable Reserves (or the accuracy of the
calculation thereof)
such Secured Party (or the Facility Agent or the Security
Trustee on its behalf) may propose modifications be made to the
Development Plan so as to render the same accurate. The Borrower
shall accept such amendments if they are reasonable, subject, if
the Borrower so requires, to delivery, at the cost of the
Borrower, of such an audit review of the amended Development
Plan as the Borrower, acting reasonably, considers to be, in
form and substance, satisfactory.
(f) If the Borrower does not agree to any such proposed change to
the Development Plan because they are not reasonable, it shall
notify the Security Trustee within 30 days of receipt of the
relevant notice from the Security Trustee, giving its reasons
for such disagreement. If the Borrower and the Security Trustee
(acting on the instructions of all Secured Parties) cannot
resolve the matter within 15 Business Days of such notice from
the Borrower, the matter shall be referred, at the cost of the
Borrower, for determination by an Expert who, acting as an
expert and not an arbitrator, shall determine the extent to
which the proposed amendments are reasonable. To the extent the
Expert does determine such amendments to be reasonable, it shall
also deliver an audit review to confirm that such amendments,
once incorporated into the Development Plan, have been properly
so incorporated. The Expert's determination and audit review
shall be final and binding on all parties.
(g) As a condition precedent to the effectiveness of any
modification to the Development Plan proposed by it, the
Borrower will deliver to the Security Trustee (with sufficient
copies for each Secured Party) a certificate calculated as of
the effective date of such modification indicating that no
Default would, or would be likely to, occur at any time as a
result of such modification, together with such information
concerning the calculations and assumptions used by the Borrower
in preparing such certificate as the Security Trustee shall have
reasonably requested.
3. PROJECT ACCOUNTS
3.1 ACCOUNTS IN GHANA
(a) ESTABLISHING GHANA ACCOUNT (DOLLARS)
The Borrower may establish an account (the "GHANA ACCOUNT
(DOLLARS)") in Ghana in the name of the Borrower with the
Project Account Bank (Ghana).
(b) GHANA ACCOUNT (CEDI).
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For the purpose of facilitating the conversion of Dollars into
Cedi and the payment of Project Costs denominated in Cedi as
well as (without prejudice to the provisions of Clause 5.18) for
the purpose of receiving any proceeds in Cedi from the sale of
Project Output or any other amount denominated in Cedi, the
Borrower may establish an account denominated in Cedi (the
"GHANA ACCOUNT (CEDI)") in Ghana in the name of the Borrower
with the Project Account Bank (Ghana).
(c) TRUST ACCOUNT.
For the sole purpose of complying with Ghanaian Applicable Law
and the requirements of the Central Bank, the Borrower may
establish the Trust Account.
(d) TRANSFER AT ECONOMIC COMPLETION AND UPON ENFORCEMENT EVENT
Upon the occurrence of an Enforcement Event, any balances
standing to the credit of any Project Account (other than the
Operating Account) shall (unless otherwise directed by the
Security Trustee) be transferred to the Operating Account.
3.2 OPERATING ACCOUNT AND TRUST ACCOUNT
(a) OPERATING ACCOUNT
The Borrower may establish an account (the "OPERATING ACCOUNT")
in London in the name of the Borrower with the Project Operating
Account Bank (U.K.).
(b) TRUST ACCOUNT
For so long as Applicable Law in Ghana shall require, all
proceeds of the sale of Project Output (including pursuant to
any Price Protection Agreement) shall be subject to the terms
and conditions of the Foreign Exchange Retention Account
Agreement, shall be deposited into the Trust Account and shall
immediately be transferred therefrom as follows:
(i) twenty per cent (20%) to the Central Bank for conversion
by the Central Bank into Cedis, such Cedi denominated
amounts to be transferred forthwith to the Ghana Account
(Cedi); and
(ii) eighty per cent (80%) to the Operating Account.
3.3 GENERAL PROVISIONS RELATING TO THE PROJECT ACCOUNTS
(a) OTHER ACCOUNTS
In addition to the Project Accounts specified in Clauses 3.1(a),
3.1(b), 3.1(c) and 3.2(a), the Borrower may, subject to Clause
3.3(f), establish further Project Accounts provided that prior
to establishing such further Project Account the Borrower has
granted to the Security Trustee such further liens, and entered
into such further Instruments as the Security Trustee shall
require (acting reasonably). The Borrower may not open any bank
account other than a Project Account.
(b) RESTRICTIONS
The Borrower shall deposit moneys to, and moneys shall be
disbursed from, the Project Accounts pursuant to the provisions
of this Agreement and the other Finance Documents.
(c) ON ENFORCEMENT
Without prejudice to the right of any Finance Party to obtain
any repayment or prepayment of any Obligation from the Project
Accounts, at any time when any Enforcement Event shall
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have occurred and be continuing, no withdrawal may be made from
any Project Account without the prior written consent of the
Security Trustee.
(d) PROJECT COSTS
No amount other than bona fide Project Costs (including any
amount in respect of insurance proceeds permitted by the terms
of Clause 5.8(c)(iv) to be applied in respect of repair,
replacement, restoration or reimbursement) payable in the amount
and during the period referred to in an Annual Budget, the
Approved Budget or, as the case may be, the Cash Flow Schedule
may be disbursed on instructions of the Borrower or otherwise
from any Project Account; provided, however, that:
(i) subject to clause (c)(ii), any Project Costs which are
scheduled, pursuant to an Annual Budget, the Approved
Budget or the Cash Flow Schedule, to be incurred in any
quarter may be incurred and paid for in any prior
quarter; and
(ii) nothing in this clause shall, or shall be deemed to,
prevent (x) disbursement of amounts from any Project
Account in payment of any Obligations (including
pursuant to the provisions of any Loan Agreement), (y)
transfer of monies between Project Accounts in
accordance with this Agreement and the other Finance
Documents, or (z) the payment of Permitted Distributions
made pursuant to Clause 6.7.
(e) REPAYING OBLIGATIONS
Any payment of any Obligations to be made from any Project
Account shall (without prejudice to the right of any Finance
Party to obtain such repayment or prepayment from any other
source, including the other Project Accounts) be made in Dollars
by disbursing from the relevant Project Account directly to such
Finance Party (and, in the case of any disbursement from the
Ghana Account (Cedi), arranging for the conversion of the
relevant disbursement from Cedi into Dollars) an amount
sufficient to provide for such payment.
(f) CURRENCY OF ACCOUNTS
Unless otherwise stated in a Finance Document:
(i) except as provided in (ii) below, each Project Account
shall be denominated in Dollars; and
(ii) for the sole purpose of paying Project Costs, the
Borrower may at any time and from time to time hold not
more than 10% (or such other amount as is agreed from
time to time by the Borrower and the Security Trustee)
of its total cash assets in a currency other than
Dollars or Cedis.
3.4 PAYMENTS FROM PROJECT ACCOUNTS AFTER DEFAULT
At any time when any Event of Default shall have occurred and be
continuing but prior to any Enforcement Event, the Borrower may only
request or direct the relevant Project Account Bank to disburse funds
from any Project Account for the purpose of payment of amounts referred
to below which shall be paid in the following order of priority and to
the extent sufficient funds are available in any Project Account:
(a) FIRST, for payment of Required Completion Expenditures, Required
Capital Expenditures and Representatives Liabilities;
(b) SECOND, for:
(i) repayment of the Principal Amount of Loans, all interest
accrued thereon and other payment Obligations (other
than as referred to in clause (c)) of the Borrower to
the Finance Parties then due and owing; and
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(ii) for payment of amounts due under a Royalty Agreement by
way of royalties pursuant to Clause 3 of the First
Royalty Agreement and, after the Discharge Date by way
of damages (including liquidated damages payable under
Clause 6 of the First Royalty Agreement); and
(c) THIRD, if prior to the Discharge Date, for payments then due and
owing in respect of Price Protection Agreements entered into by
the Borrower with a Secured Party in accordance with Clause 5.11
(including for the purchase of Ounces to make such payment).
3.5 PAYMENT FROM PROJECT ACCOUNTS TO PAY PERMITTED DISTRIBUTIONS
Each Secured Party agrees that, notwithstanding the terms of any Share
Security Agreement, on each Cash Sweep Date upon which a Permitted
Distribution may be made, such Secured Party shall, upon request of the
Borrower, instruct the Security Trustee to release sufficient dividends
from such Share Security Agreement to make payment of such dividends.
4. REPRESENTATIONS AND WARRANTIES
4.1 MAKING OF REPRESENTATIONS AND WARRANTIES
The representations and warranties set forth in this Clause and each
other Repeating Representation shall be made:
(a) on the date of this Agreement;
(b) upon the delivery of each Utilisation Request delivered on or
after the New Ownership Date;
and shall be deemed to have been made on:
(c) each Utilisation Date on or after the New Ownership Date (both
immediately before and immediately after the application of the
proceeds of the relevant Loans);
(d) the New Ownership Date;
(e) the Economic Completion Date;
(f) the Release Date;
(g) any date on which any person grants further security pursuant to
any Finance Document on or after the New Ownership Date;
(h) any date the Borrower enters into a Royalty Agreement other than
the First Royalty Agreement;
(i) any date when any person accedes to or becomes party to any
Finance Document as an Obligor on or after the New Ownership
Date; and
(j) the last day of each 12 monthly period ending after the New
Ownership Date.
4.2 ORGANISATION, POWER, AUTHORITY, ETC.
Each Obligor:
(a) in the case of the Borrower, is a company validly organised and
existing and in good standing under the laws of Ghana;
(b) in the case of each other Obligor, is a company validly
organised and existing under the laws of its formation;
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(c) is duly qualified to do business and is in good standing (where
such concept is applicable) as a foreign company in each
jurisdiction where the nature of its business makes such
qualification necessary and where the failure to so qualify
would have a Materially Adverse Effect on it;
(d) has full power and authority, and holds all requisite Approvals,
to own and hold under lease its property, to ▇▇▇ and to be sued
in its own name and to conduct its business substantially as
currently conducted by it; and
(e) has full power and authority to enter into and perform its
obligations under this Agreement and the other Operative
Documents executed or to be executed by it and (in the case of
the Borrower) to obtain the Loans and to make payments under
each Royalty Agreement.
4.3 DUE AUTHORISATION; NON-CONTRAVENTION
The execution and delivery by each Obligor of this Agreement and each
other Operative Document executed or to be executed by it and the
performance by it of its obligations hereunder and thereunder, and, in
the case of the Borrower, the receipt of the Loans under the Loan
Agreement and the making of payments under each Royalty Agreement:
(a) have been duly authorised by all necessary corporate action on
its part and do not require any Approval (other than those
Approvals referred to in Item 1 ("APPROVALS") of the Disclosure
Schedule), except where failure to obtain such Approval could
not lead to a Materially Adverse Effect;
(b) do not and will not conflict with, result in any violation of,
or constitute any default under, any provision of any
Requirement of Law or Approval binding on it, except where such
conflict, violation or default could not lead to a Materially
Adverse Effect;
(c) will not result in or require the creation or imposition of any
lien on any of its properties pursuant to the provisions of any
Contractual Obligation (other than pursuant to this Agreement
and each Security Agreement to which it is a party); and
(d) will not cause any borrowing, negative pledge or other
limitation on it or the powers of the directors or other
officers of such Obligor to be exceeded.
4.4 VALIDITY, ETC.
(a) This Agreement constitutes, and each other Operative Document
executed or to be executed by each Obligor constitutes, or on
the due execution and delivery by it thereof will constitute,
the legal, valid, and binding obligation of such Obligor
enforceable against it in accordance with its terms (subject, as
to enforcement, to bankruptcy and insolvency laws and other
similar laws of applicability to creditors generally and to
general equitable principles).
(b) Upon execution each Security Agreement will create in favour of
the Security Trustee (and for the benefit of the Finance
Parties), a valid and perfected lien on all of the assets,
properties, rights and revenues referred to in each such
Security Agreement as security for the relevant obligations
expressed to be covered thereby, subject to no liens, except:
(i) for mandatory provisions of Applicable Law; and
(ii) as specifically permitted by this Agreement or such
Security Agreement.
4.5 LEGAL STATUS; NO IMMUNITY
No Obligor or any of their respective properties or revenues enjoys any
right of immunity from suit, set-off, attachment, execution, attachment,
judgment or other legal process in respect of such Obligor's obligations
under any of the Operative Documents to which it is a party.
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4.6 FINANCIAL INFORMATION
All balance sheets and all statements of profit and loss and cash flow
and all other financial information relating to any Obligor which has
been furnished by or on behalf of any Obligor to a Finance Party (in the
case of the Borrower, on or after the New Ownership Date) for the
purposes of or in connection with any Finance Document or any
transaction contemplated thereby, including the most recent balance
sheet of any Obligor delivered to any Finance Party, and the related
statements of profit and loss and cash flow of the Borrower for the
Fiscal Year then ended, as certified by the chief financial Authorised
Representative of the Borrower, have been prepared in accordance with
GAAP consistently applied throughout the periods involved (except as
disclosed therein) and present fairly the financial position of such
Obligor as at the dates thereof and the results of its operations for
the periods then ended. The Borrower does not have any material
contingent liability or liability for taxes, long-term leases or unusual
forward or long-term commitments which are not reflected in its
financial statements described in this Clause or in the notes thereto.
4.7 ABSENCE OF DEFAULT
(a) None of the Borrower, the Holding Company or any other Obligor
is in default in the payment of (or in the performance of any
material obligation applicable to) any indebtedness;
(b) the Borrower, the Holding Company and each other Obligor
represent and warrant that no Default is outstanding or would
result (or has resulted) from the making of any Loan; and
(c) no Obligor is in default under any material provision of any
Project Document to which it is party, any material Requirement
of Law or the terms or conditions upon which any Approval has
been granted.
4.8 LITIGATION, ETC.
There is no pending or, to the knowledge of any Obligor, threatened
litigation, arbitration, employment dispute or governmental
investigation or proceeding against any Obligor or to which any of its
business, operations, properties, assets (including the Mine), revenues
or prospects is subject which, if adversely determined, could reasonably
have a Materially Adverse Effect with respect to the Borrower, the
Holding Company or any other Obligor. In the case of any litigation so
disclosed, there has been no development in such litigation since the
Effective Date which could reasonably have a Materially Adverse Effect
with respect to the Borrower, the Holding Company or any other Obligor.
4.9 MATERIALLY ADVERSE EFFECT
Since the New Ownership Date, there have been no occurrences which,
individually or in the aggregate, could reasonably be expected to have a
Materially Adverse Effect with respect to any Obligor.
4.10 BURDENSOME AGREEMENTS
No Obligor is a party or subject to any Contractual Obligation or
Organic Document which has or may reasonably be expected to have a
Materially Adverse Effect on it.
4.11 TAXES AND OTHER PAYMENTS
(a) Each Obligor (other than the Sponsor) has filed all tax returns
(including all property tax returns and other similar tax
returns applicable to the Mine) and reports required by
Applicable Law to have been filed by it and has paid all taxes
and governmental charges thereby shown to be due and owing and
all claims for sums due for labour, material, supplies, personal
property and services of every kind and character provided with
respect to, or used in connection with its business (including
in the case of the Borrower, the Mine) and no claim for the same
exists except as permitted hereunder, except any such taxes,
charges or amounts:
(i) in respect of which the relevant invoice or demand for
payment (other than a demand referred to in Clause 7.1
(s)) was issued not more than 30 days prior to the
payment
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thereof (and in respect of which such Obligor will pay
prior to the end of such period);
(ii) for which an initial internal appeal (if available) has
been made to the relevant Governmental Authority, not
more than 14 days has elapsed since any such appeal has
been made and no Governmental Authority has attempted to
create or exercise any lien in respect of such unpaid
taxes, charges or amounts; or
(iii) in respect of which an amount not less than maximum
amount payable in respect thereof has been lodged in an
account in London with the Security trustee and which is
subject to a first ranking in favour of the Security
Trustee.
Summary details of taxes required to be paid by the Borrower in
connection with the development of the Project are set forth in Item 10
("TAXES") of the Disclosure Schedule.
4.12 MINING RIGHTS, PROJECT ASSETS
The Borrower:
(a) will have (or, if this representation is given or deemed
repeated on or after the New Ownership Date, has) by the New
Ownership Date acquired the Mining Lease and the Mining Rights
attached thereto;
(b) will have acquired by the Economic Completion Date all other
Project Assets and such other surface and other rights as are
necessary for access rights, water rights, plant sites, tailings
disposal, waste dumps, ore dumps, abandoned heaps or ancillary
facilities which are required in connection with the development
of the Project;
(c) as of the Economic Completion Date and each date thereafter, all
such Project Assets, Mining Rights and other rights will be or
are sufficient in scope and substance for the development of the
Project and no part of the purchase price payable in connection
with the acquisition of such Mining Rights and other rights
(other than, prior to the Economic Completion Date, the Deferred
Consideration and any royalty payments, if any, payable pursuant
to any Royalty Agreement) remains unpaid.
4.13 OWNERSHIP AND USE OF PROPERTIES; LIENS
(a) The Borrower will:
(i) as at the first Utilisation Date and on each date
thereafter, have good and marketable title to the Mining
Lease; and
(ii) at all times on and after the Economic Completion Date,
have good and marketable title to all Project Assets.
in each case free and clear of all liens or claims (including
infringement claims with respect to patents, trademarks,
copyrights and the like) except as permitted pursuant to Clause
6.4 or as disclosed in Item 3 ("ASSETS; PROPERTIES") of the
Disclosure Schedule.
(b) The Borrower does not own any assets or properties other than
those used in connection with the Project and those incidental
to the operation of the Mine.
(c) The Borrower has complied in all material respects with all
Contractual Obligations relating to any Project Asset leased,
operated, licensed or used (but not owned) by it and all
Instruments pursuant to which it is entitled to lease, operate,
license or use any such Project Assets are in full force and
effect.
(d) None of the Obligors party to this Agreement from time to time
is a party to, nor is it or any of its assets bound or affected
by, any order, licence, permit, consent, agreement or instrument
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under which such Obligor is, or in certain events may be,
required to create, assume or permit to arise any lien other
than a Permitted Lien.
4.14 SUBSIDIARIES
(a) The Borrower has no subsidiaries.
(b) The Holding Company has no subsidiaries other than the Borrower.
4.15 INTELLECTUAL PROPERTY
At all times on and after the New Ownership Date, the Borrower owns and
possesses all such patents, patent rights, trademarks, trademark rights,
trade names, trade name rights, service marks, service ▇▇▇▇ rights and
copyrights as it considers necessary for the conduct of its business as
now conducted without, individually or in the aggregate, any
infringement upon rights of other persons which could reasonably be
expected to have a Materially Adverse Effect with respect to it, and
there is no individual patent or patent licence the loss of which would
have such a Materially Adverse Effect.
4.16 TECHNOLOGY
At all times on and after the Economic Completion Date, the Borrower
owns or has the right to use all technologies and processes required by
it to consummate the Project and operate the Mine in accordance with
good industry practice. There are no material licence agreements
granting any other person rights in any patented process or the right to
use technical or secret know-how that are required for the consummation
of the Project or the operation of the Mine.
4.17 APPROVALS; PROJECT DOCUMENTS
(a) At all times on and after the New Ownership Date, all
Instruments have been entered into and all Approvals have been
obtained by the Borrower (other than those identified in Part B
("PENDING APPROVALS") of Item 1 of the Disclosure Schedule as
being scheduled to be obtained after the date the representation
referred to in this clause is made or repeated from time to
time) which are required or advisable to consummate the Project
and facilitate the operation of the Mine. All Approvals
necessary or advisable to obtain in connection with the
consummation of the Project and the operation of the Mine in
accordance with the Development Plan are listed on Item 1
("APPROVALS") of the Disclosure Schedule.
(b) Except as disclosed in writing to the Security Trustee, each of
the Project Documents that has been provided to the Facility
Agent or the Security Trustee is:
(i) in full force and effect;
(ii) enforceable by each Obligor party to it against all
other parties thereto in accordance with its terms
(subject, as to enforcement, to bankruptcy and
insolvency laws and other laws of applicability
generally and to general equitable principles); and
(iii) in the form previously or concurrently delivered to the
Facility Agent or the Security Trustee pursuant to any
Finance Document.
(c) All material performance required under each Project Document of
each Obligor (and, to the best of the knowledge of such Obligor,
of each other party) has occurred (except performance required
by any relevant Project Document to be performed at a later
date), and no default (however denominated or described) in the
performance of the obligations of any Obligor (or, to the best
of the knowledge of such Obligor, of any other party) under any
Project Document to which it is a party has occurred and is
continuing.
4.18 ADEQUACY OF INFORMATION
The Borrower represents and warrants that:
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(a) the factual statements contained (or if not yet provided to any
Finance Party, will contain when so provided) in each of the
Development Plan, Environmental Impact Statement and Insurance
Summary, based upon the assumptions stated therein, have been or
will be prepared with due care, are true and correct in all
material respects and do not and will not omit to state any
information or fact the omission of which might render any
conclusion or statement contained in any such document
misleading in any material respect;
(b) the Development Plan contains (or if not yet provided to the
Facility Agent, will contain when so provided) summary
descriptions of the Project Assets and the Project and the
operation of the Mine as proposed to be conducted throughout the
Project Period;
(c) the Environmental Impact Statement, the Technical Review and the
Insurance Summary contain (or if not yet provided to any Finance
Party, will contain when so provided) summary descriptions of
the environmental, technical and insurance aspects respectively
of the Project Assets and the Project and the operation of the
Mine as now conducted and as proposed to be conducted throughout
the Project Period; and
(d) the financial projections, estimates and other expressions of
view as to future circumstances contained (or if not yet
provided to the Facility Agent, will contain when so provided)
in the Development Plan are fair and reasonable and, to the best
of the Borrower's knowledge, have been (or, if not yet provided,
will be when provided) arrived at after reasonable enquiry and
have been made in good faith by the persons responsible
therefor.
4.19 ENVIRONMENTAL WARRANTIES
Each of the Borrower and the Holding Company represents and warrants
that:
(a) all facilities and property (including underlying groundwater)
owned, operated, leased or utilised by any Obligor or, so far as
such Obligor is aware having made enquiry, any other Project
Party (in each case) in connection with the Project have been
(from the New Ownership Date), and will continue to be (from the
date the initial Environmental Impact Statement is delivered
pursuant to Clause 2.2(a)), owned, operated, leased or utilised
by such person in compliance with the standards set out in,
referred to or utilised by the Environmental Impact Statement
(the "ENVIRONMENTAL REVIEW STANDARDS") and in compliance with
all Environmental Laws except where any failure to so comply (x)
would not reasonably be expected to have a Materially Adverse
Effect with respect to such Obligor, or (y) has not resulted in,
and would not reasonably be likely to result in, any action
being taken by any Governmental Agency or any other person;
(b) there has not been since the New Ownership Date any past, and
there are no pending or, to its knowledge, threatened:
(i) claims, complaints, notices or requests for information
received by it or, so far as it is aware, having made
reasonable enquiry, any other Project Party in
connection with the Project with respect to any alleged
violation of Environmental Review Standards or any
Environmental Law; or
(ii) claims, complaints, notices or inquiries to it, or so
far as it is aware having made reasonable enquiry, such
Project Party in connection with the Project regarding
potential liability under any Environmental Review
Standard or Environmental Law;
(c) since the New Ownership Date there have been no releases or
emissions of Hazardous Materials at, on or under any property
now or previously owned, operated or leased by the Borrower or,
so far as each of the Borrower or the Holding Company is aware
having made enquiry, any other Project Party in connection with
the Project that, singly or in the aggregate, have, or may
reasonably be expected to have, a Materially Adverse Effect with
respect to it;
(d) since the New Ownership Date the Borrower, and so far as it is
aware having made enquiry, each other Project Party has been
issued with, and is in compliance with, all Environmental Review
Standards and Approvals relating to environmental matters which
are necessary or
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advisable for the Project except where any failure to so comply
(x) would not reasonably be expected to have a Materially
Adverse Effect with respect to it, or (y) has not resulted in,
and would not reasonably be likely to result in, any action
being taken by any Governmental Agency or any other person;
(e) since the New Ownership Date no property now or previously
owned, operated or leased by the Borrower is listed or, to its
knowledge, proposed for listing on any governmental or
regulatory list of sites requiring investigation or clean-up;
(f) there have not been since the New Ownership Date any underground
or above-ground storage tanks, active or abandoned, including
petroleum storage tanks, on or under any property now or
previously owned on or after the New Ownership Date, operated or
leased on or after the New Ownership Date by the Borrower that,
singly or in the aggregate, could reasonably be expected to
have, a Materially Adverse Effect with respect to the Borrower;
(g) since the New Ownership Date the Borrower has not and, so far as
the Borrower or the Holding Company is aware having made
reasonable enquiry no other Project Party has, directly
transported or directly arranged for the transportation of any
Hazardous Material in connection with the Project which may lead
to material claims against the Borrower for any remedial work,
damage to natural resources or personal injury;
(h) there have not been since the New Ownership Date any
polychlorinated biphenyls or friable asbestos present at any
property now or previously owned on or after the New Ownership
Date, operated or leased on or after the New Ownership Date by
the Borrower or, so far as it is aware having made reasonable
enquiry, any other Project Party in connection with the Project
that, singly or in the aggregate, could reasonably be expected
to have, a Materially Adverse Effect with respect to the
Borrower; and
(i) there have not been since the New Ownership Date any conditions
that exist at, on or under any property now or previously owned,
leased, operated, licensed or used in each case on or after the
New Ownership Date by the Borrower or any other Project Party in
connection with the Project which, with the passage of time, or
the giving of notice or both, would give rise to liability under
any Environmental Review Standard or Environmental Law that,
individually or in the aggregate, has, could reasonably be
expected to have, a Materially Adverse Effect with respect to
the Borrower.
4.20 PARI PASSU
The payment Obligations of each Obligor under each Finance Document to
which it is a party rank at least pari passu in right of payment with
all of such Obligor's other unsecured indebtedness, other than any such
indebtedness which is preferred by mandatory provisions of Applicable
Law or as set out in any Finance Document.
4.21 ROYALTIES, ETC.
Other than as disclosed in Item 6 ("ROYALTY AGREEMENTS") of the
Disclosure Schedule, neither the Mine nor the Borrower's interest
therein is subject to any royalty, net smelter return obligation, net
profit payment or similar arrangement.
4.22 MANAGEMENT OF MINE
The Borrower has sole responsibility for the construction, operation and
management of the Mine and has not and does not propose to enter into
any agreement for any third party to construct, operate or manage all or
part of the Mine, except as provided in any Project Document.
4.23 SOLVENCY
No Obligor is unable to pay its debts within the meaning of Section 123
of the Insolvency ▇▇▇ ▇▇▇▇ or within the meaning of any equivalent
legislation in its place of incorporation or in any place in which it
carries on its business or its assets are located.
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4.24 MATERIAL AGREEMENTS
The Borrower has provided to the Facility Agent and the Security Trustee
certified copies of all Instruments which are Material Agreements or
otherwise material or reasonably likely to be material to:
(a) any Finance Party's decision to enter into the Finance Documents
to which it becomes a party on or after the New Ownership Date
and, in the case of any other Obligor to which it becomes a
party at any time;
(b) the Project; or
(c) any Obligor's rights and obligations pursuant to any Operative
Document,
and each such Instrument in existence as at the date hereof and on the
New Ownership Date is listed under Item 8 ("MATERIAL AGREEMENTS") of the
Disclosure Schedule.
4.25 REGISTRATION
It is not necessary or advisable that this Agreement or any other
Operative Document to which any Obligor is a party be filed, registered,
recorded or enrolled with any court, public office or other authority in
any jurisdiction or that any stamp, documentary, registration or similar
Tax or duty be paid on or in relation to this Agreement or any other
Operative Document, except to the extent this Agreement or such
Operative Document has been filed, registered, recorded or enrolled, as
the case may be, or such Tax has been paid as set out in the Disclosure
Schedule.
4.26 LEASES
The Borrower has acquired all leases of real property and other rights
of whatever nature necessary for the present and proposed conduct of its
business and the carrying out of the Project.
4.27 ISSUE OF SHARES
There are no agreements or arrangements in force (in the case of the
Borrower, on or after the New Ownership Date) which provide for the
present or future issue, allotment or transfer of, or grant to any
person the right (whether conditional or otherwise) to call for the
issue, allotment or transfer of any share or loan capital of the
Borrower or the Holding Company (including any option or right of
pre-emption or conversion).
4.28 SPECIAL PURPOSE VEHICLE
The Borrower has not traded (on or after the New Ownership Date) or
incurred any liabilities (on or after the New Ownership Date) other than
in connection with its participation in the transactions contemplated in
the Operative Documents.
4.29 TAX STATUS
The Borrower is and has been since the New Ownership Date a company
resident in Ghana and, except as stated in the Deed of Warranty, is
subject to Applicable Laws relating to Taxation.
5. COVENANTS
5.1 CERTAIN AFFIRMATIVE COVENANTS
Each Obligor party to this Agreement from time to time agrees with each
Finance Party that, on and from the New Ownership Date and until all
Commitments have terminated and all Obligations have been paid and
performed in full, it will perform its respective undertakings set forth
in this Clause.
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5.2 FINANCIAL INFORMATION, ETC.
The Borrower (and/or where stated below, each other Obligor) will
furnish, or will cause to be furnished, prior to the Discharge Date to
the Facility Agent (with copies for each Lender) and at all times, to
each Royalty Holder copies of the following financial statements,
reports and information:
(a) promptly when available, and in any event within 120 days after
the close of each Fiscal Year of the Borrower and (if prepared
or if requested) each other Obligor, its own balance sheets at
the close of such Fiscal Year and the related statements of
profit and loss and cash flow in each case with comparable
information at the close of and for the prior Fiscal Year, and
in each case reported on without Impermissible Qualification by
the Auditors, together with a certificate from the Auditors to
the effect that, in making the examination necessary for the
signing of such financial statements by the Auditors, they have
not become aware of any Default in respect of Clauses 6.3 or any
financial covenants incorporated in any Finance Document or an
Insolvency Default that has occurred and is continuing, or, if
they have become so aware, describing such Default or breach;
(b) (i) promptly when available, and in any event within 45 days
after the close of each of the first three Fiscal
Quarters of each Fiscal Year of the Borrower falling on
or after the Economic Completion Date, and any other
Obligor, its balance sheet at the close of such Fiscal
Quarter, and its related statements of profit and loss
and cash flows in each such case in respect of such
related statements, for such Fiscal Quarter and for the
period commencing at the close of the previous Fiscal
Year and ending with the close of such Fiscal Quarter
(with comparable information at the close of and for the
corresponding Fiscal Quarter of the prior Fiscal Year
and for the corresponding period during such prior
Fiscal Year) and certified by an accounting or financial
Authorised Representative of the Borrower or, as the
case may be, such other Obligor; and
(i) within twenty days of the last day of each Cash Flow
Period falling on or after the Economic Completion Date,
management accounts of the Borrower for the Cash Flow
Period then ended in sufficient detail to enable the
Facilities Agent to calculate Excess Cash Flow and CFAD
for such Cash Flow Period;
(c) on the Economic Completion Date and within 20 Business Days of
each Calculation Date (other than the Economic Completion Date),
a Compliance Certificate calculated as of the Economic
Completion Date or such Calculation Date, as the case may be,
indicating, inter alia, compliance any financial covenants set
forth in any Finance Document on each Calculation Date
coinciding with or scheduled to occur thereafter, together with
such information concerning the calculations and assumptions
used by the Borrower in preparing such Compliance Certificate as
the Facility Agent, the Security Trustee or any Royalty Holder
may (acting reasonably) request;
(d) prior to the Economic Completion Date, upon request and,
thereafter promptly upon receipt thereof, copies of all detailed
financial and management reports submitted to the Borrower by a
certified public or chartered accountant in connection with each
annual or interim audit made by such certified or chartered
public accountant of the books of the Borrower;
(e) on the New Ownership Date, annually on or about each anniversary
of the New Ownership Date until the Economic Completion Date, on
the Economic Completion Date and annually on the anniversary of
the Economic Completion Date (or such other date as the Security
Trustee shall agree), a memorandum prepared by the Borrower
summarising the then outstanding insurance coverage with respect
to the Mine and a certificate or certificates of insurance
prepared by the Insurance Consultant confirming that: (i) all
such insurance coverage is in full force and effect and all
premiums payable in connection therewith have been paid; (ii) in
the opinion of the Insurance Consultant, such insurance is
sufficient for the purposes of the Mine and is responsive to the
requirements of Clause 5.8; (iii) the Security Trustee is named
as the sole loss payee under all policies of property insurance
and as an additional insured under all policies of liability
insurance; and (iv) the insurers under such insurance policies
have undertaken in writing not to amend or terminate such
policies without at least 30 days' prior
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written notice thereof to the Security Trustee and have entered
into such undertakings as are required pursuant to Clause
5.8(b); it being agreed that such certificate(s) shall be
conclusive as against the Borrower both as to the amount of
insurance required and the perils against which coverage is
required and the Borrower shall immediately ensure that
insurance is effected in accordance with such certificate(s);
(f) as promptly as practicable details as to any: (i) material
disputes with the Borrower's insurance carriers; (ii) failure by
the Borrower to pay any insurance premium as and when required
that might result in the cancellation of the relevant policy;
(iii) material reduction in the amount of, or any other material
change in, insurance coverage maintained in connection with the
Mine; (iv) failure to comply with its obligations under Clause
5.8, in each case stating the reasons therefor, together with
any other information concerning the insurance and reinsurance
coverage required to be maintained by it as the Security Trustee
shall have reasonably requested; (v) occurrence of any actual or
potential casualty or loss which is covered by the terms of any
policy of insurance maintained by or on behalf of the Borrower
in connection with the Mine; and (vi) notices received from any
of the Borrower's insurance carriers with respect to the
cancellation of or proposed cancellation of any policy of
insurance maintained in connection with the Mine;
(g) without prejudice to the provisions of Clause 7.1(g) or 7.1(h),
each Obligor will furnish promptly upon the occurrence thereof
copies of any Instrument, correspondence or other item of
documentation amending, supplementing or otherwise modifying any
material provision of any Project Document to which such Obligor
is a party and a detailed report of any departure from the
performance by any party of any of its material obligations
under any Project Document to which it is a party;
(h) promptly upon receiving knowledge of the same, each Obligor will
furnish notice of the occurrence of any material default or
event of default (however described but without prejudice to the
provisions of Clause 7.1(g) or 7.1(h)) by any party under, or
any other material change in or circumstance affecting, any of
the Project Documents to which it is a party;
(i) without limiting any other provision of this Clause 5, as soon
as possible and in any event within three Business Days after
the occurrence of any Default of which it becomes aware with
respect to any Obligor, such Obligor will furnish a statement of
its chief financial officer setting forth details of such
Default and the action which such Obligor has taken and proposes
to take with respect thereto;
(j) as soon as possible and in any event within five Business Days
after:
(i) the occurrence of any adverse development with respect
to any litigation, arbitration, employment dispute, or
governmental investigation or proceeding to which an
Obligor is a party which could reasonably have a
Materially Adverse Effect with respect to any Obligor;
or
(ii) the commencement of any material litigation,
arbitration, employment dispute or governmental
investigation or proceeding to which an Obligor is a
party,
the relevant Obligor will furnish to the Facility Agent and each
Royalty Holder notice thereof and copies of all documentation
relating thereto;
(k) without limiting any other provision of this Clause, each
Obligor as soon as possible and in any event within three
Business Days after such Obligor knows or has reason to know of
the occurrence of any circumstance which could reasonably have a
Materially Adverse Effect with respect to such Obligor, furnish
notice of such occurrence;
(l) not later than the 15th day of each calendar month beginning
after the New Ownership Date, the Borrower shall deliver a
Monthly Mine Report as at the close of the previous calendar
month in form and substance satisfactory (prior to the Discharge
Date) to the Facility Agent
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(acting in consultation with the Independent Engineer) and
(thereafter) to each Royalty Holder;
(m) not more than five Business Days after the end of each calendar
month the Borrower shall deliver (i) a summary of the balance of
each Project Account as at the last day of such calendar month
(ii), if requested, a statement showing in detail all credits
to, debits from, and balances standing to the credit of the
Project Accounts for such calendar month and (iii) if requested,
a certificate, duly executed by the chief financial or
accounting officer of the Borrower, indicating the amounts, and
the relevant payee, of all Project Costs made for such calendar
month, such payments to be consistent with (prior to the
Economic Completion Date) the annual budget approved by the
Secured Parties pursuant to Clause 2.1 or (on and from the
Economic Completion Date) the Approved Budget and/or the Cash
Flow Schedule (except to the extent permitted by Clause
3.3(d)(i));
(n) without prejudice to Clause 3.6 of the First Royalty Agreement
or any similar provision in any other Royalty Agreement, the
Borrower shall promptly after the end of each calendar year,
deliver a statement to (if prior to the Discharge Date) the
Facilities Agent and (at all times) each Royalty Holder (which
statement shall have been subject to satisfactory review by the
Independent Engineer) of estimated Proven and Probable Reserves
as at the end of such calendar year;
(o) the Holding Company and the Borrower will furnish copies of each
material filing report or document made to or filed with, or
received from, any Governmental Agency, and of each material
communication from such Obligor to shareholders or creditors
generally, in each case promptly upon the making, filing or
receipt thereof which, in any such case, relate to or describe
any material matter in connection with the business, operations,
assets, financial condition or prospects of such Obligor;
(p) each Obligor will furnish copies of all material Instruments
entered into by such Obligor or any other person in connection
with the Project or the operation of the Mine in each case
promptly upon having entered into the same and will immediately
give notice of any intention to enter into any such Instrument;
(q) the Borrower shall provide the Secured Parties (in the case of
the Lenders, through the Facilities Agent) with copies of any
other report or communication received by the Borrower from its
auditors relating to the financial position or affairs of the
Borrower which is of a material nature including any management
letter from the auditors; and
(r) each Obligor will furnish such other information with respect to
the financial condition, business, property, assets, revenues
and operations of such Obligor as any Finance Party may from
time to time reasonably request in connection with the Project
or any of the Operative Documents.
5.3 COMPLIANCE WITH LAWS
Each Obligor will comply in all material respects with all Applicable
Laws.
5.4 APPROVALS.
(a) Each Obligor will obtain, maintain in full force and effect, and
comply in all respects with, all Approvals (including those
identified in Item 1 of the Disclosure Schedule as being
applicable to it) as may be required from time to time for such
Obligor to (i) execute, deliver, perform and preserve its rights
under any of the Operative Documents executed or to be executed
by it, (ii) grant and perfect the liens granted or purported to
be granted and perfected by it pursuant to any Security
Agreement and (iii) in the case of the Borrower, own, lease, use
or license the Project Assets in which it holds any interest and
operate the Mine in accordance with sound mining and business
practice, in each case where failure to obtain, maintain in full
force and effect and comply with such Approval which, may lead
to a Materially Adverse Effect.
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(b) Without limiting clause (a), each Obligor will obtain all
Approvals identified in Part B of Item 1 ("PENDING APPROVALS")
of the Disclosure Schedule by the date set forth in the
Disclosure Schedule opposite such Approval and, within five
Business Days of obtaining any such Approval, deliver copies
(or, if requested, the original) of such approval to the Secured
Parties (in the case of the Lenders, through the Facilities
Agent).
(c) Each of the Borrower and the Holding Company shall take all
steps within its powers to obtain, maintain and when necessary
renew all rights, powers, privileges, licences, consents,
approvals and agreements the benefit of which it may enjoy from
time to time and which may be of material benefit to it or the
Project and defend any action, claim or other proceedings in any
court or tribunal which may be brought against it by any person
where failure to obtain, maintain, renew and defend such rights,
powers, privileges, licences, consents, approvals or agreements
may lead to a Materially Adverse Effect.
5.5 MAINTENANCE OF CORPORATE EXISTENCE
Each Obligor will do and will cause to be done at all times all things
necessary to maintain and preserve its corporate existence.
5.6 FOREIGN QUALIFICATION
The Borrower and the Holding Company will do and will cause to be done
at all times all things necessary to be duly qualified to do business
and be in good standing (where such concept is relevant) as a foreign
company or corporation in each jurisdiction where the nature of its
business makes such qualification necessary.
5.7 PAYMENT OF TAXES, ETC.
Each Obligor will pay and discharge, as the same may become due and
payable, all taxes, assessments, fees and other governmental charges or
levies against it or on any of its property, as well as claims of any
kind or character (including claims for sums due for labour, material,
supplies, personal property and services); provided, however, that the
foregoing shall not require any Obligor to pay or discharge any such
tax, assessment, fee, charge, levy or claim:
(a) in respect of which the relevant invoice or demand for payment
(other than a demand referred to in Clause 7.1(s)) was issued
not more than 30 days prior to the payment thereof (and in
respect of which the relevant Obligor has, upon request,
demonstrated to the satisfaction of the Required Secured Parties
that it will pay prior to the end of such period);
(b) without prejudice to Clause 7.1(b):
(i) for which an initial internal appeal (if available) has
been made to the relevant Governmental Authority, not
more than 14 days has elapsed since any such appeal has
been made and no Governmental Authority has attempted to
create or exercise any lien in respect of such unpaid
taxes, charges or amounts; or
(ii) in respect of which an amount not less than maximum
amount payable in respect thereof has been lodged in an
account in London with the Security Trustee and which is
subject to a first ranking lien in favour of the
Security Trustee.
5.8 INSURANCE
(a) The Borrower will maintain with insurance companies reasonably
satisfactory to the Required Secured Parties: (i) insurance as
required under this Agreement, the Security Agreements and any
other Operative Document or pursuant to Applicable Law, and (ii)
such other insurance with respect to the properties and business
of the Borrower against such casualties and contingencies and of
such types and in such amounts as is customary in the case of
similar businesses to the Project similarly situated and
financed on a limited recourse basis and such other insurance as
may be required by any Applicable Law or by the Facilities Agent
acting reasonably or the Security Trustee (acting in
consultation with the Insurance Consultant, if
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appointed) and the Borrower will, upon request of any Secured
Party, furnish to the Security Trustee at reasonable intervals a
certificate acceptable to the Security Trustee setting forth the
nature and extent of all insurance maintained by the Borrower in
accordance with this Clause and confirming its adequacy and
sufficiency. The Security Trustee may (and shall if instructed
by the Required Secured Parties) solicit the services of the
Insurance Consultant to assess the adequacy and sufficiency of
the insurance coverage required to be maintained by the Borrower
hereunder and to evaluate the contents of the foregoing
certificate. The Borrower will immediately notify the Security
Trustee of any proposed change of any insurance company
providing insurance coverage of the nature referred to in this
Clause, and any such change shall require the consent of the
Security Trustee (which consent will not be unreasonably
withheld). The Borrower will ensure that, on and from the New
Ownership Date, the Insurance Summary is complete and accurate
at all times and will from time to time provide the Security
Trustee with amendments thereto when necessary to ensure that
the Insurance Summary is so complete and accurate, together with
copies of all insurance policies as in effect from time to time.
Without prejudice to the foregoing, the Borrower shall ensure,
on and from the New Ownership Date, that all premiums required
to be paid in order to ensure that the policies referred to in
this clause are in full force and effect shall be paid as and
when the same shall become due and payable and shall otherwise
comply with each other term and condition of such policies so as
to ensure that such policies are, and shall continue, in full
force and effect.
(b) All of the Borrower's insurance policies shall, in each case, in
accordance with standard practice in the mining industry having
regard, inter alia, to the limited recourse nature of the
facility granted pursuant to this Agreement:
(i) specify the Finance Parties as additional insureds under
all policies of liability insurance and as additional
insured and as the first loss payee under all policies
of property and (from commissioning of the Project)
business interruption insurance, and contain such
endorsements in favour of the Security Trustee as the
Security Trustee shall reasonably require;
(ii) not be cancellable (or be cancellable only on terms
acceptable to the Security Trustee) or non-renewable or
subject to a decrease in the scope or amount of coverage
(including by way of increase in any deductible) as
against the Security Trustee (including for failure to
pay premiums) or subject to material alteration of any
kind without the consent of the Security Trustee;
(iii) in the case of insurance covering loss or damage to any
of the Project Assets, contain a "lender loss payable"
provision for the benefit of the Security Trustee on
behalf of itself and the other Finance Parties
(including provisions that the policy shall not be
invalidated as against the Security Trustee or any other
Finance Party by reason of any action or failure to act
on the part of the Borrower or any other person),
provide for waiver of any right of set-off, recoupment,
subrogation, counterclaim or any other deduction, by
attachment or otherwise, with respect to any liability
of the Borrower, and shall provide that all amounts
payable by reason of loss or damage to any of the
Project Assets shall be payable to the Security Trustee
for replacement;
(iv) provide for payments of claims thereunder in Dollars;
and
(v) otherwise be in form and substance reasonably
satisfactory to the Security Trustee.
(c) The Borrower will, subject to this Agreement, cause the
proceeds, if any, of all insurances maintained with respect to
the Project and the Mine to be applied as follows:
(i) all amounts received in respect of (x) the partial or
total nationalisation, expropriation, compulsory
purchase or requisition of the Mine or the Project
Assets, or any interest therein, (y) any release,
inhibition, modification, suspension or extinguishment
of any Mining Rights, or the imposition of any
restriction affecting the Mine or the Project Assets or
the grant of any Mining Right and (z) the suspension or
material modification of any Approval required or
advisable in
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connection with the Project or the operation of the Mine shall
be paid to the Security Trustee for application as set forth in
Clause 12.15;
(ii) all amounts received by the Borrower or on its behalf in
respect of any third party liability insurance shall be
paid directly to the person entitled thereto;
(iii) all amounts received in respect of any business
interruption insurance or delay in start-up insurance
shall be deposited into the Operating Account; and
(iv) prior to an Event of Default, all proceeds from casualty
or property insurance received for any single repair,
replacement or restoration costing less than
U.S.$1,000,000 (or the equivalent thereof in any other
currency) shall be deposited into the Operating Account
and may be applied to the repair, replacement or
restoration of the assets in respect of which the
relevant proceeds were received or for reimbursement of
the person which effected such repair, replacement or
restoration and after an Event of Default all such
proceeds shall be promptly deposited into the Operating
Account and applied as the Finance Parties shall
determine. All such proceeds received for any such
single repair, etc. costing an amount which is equal to
or in excess of U.S.$1,000,000 (or the equivalent
thereof in any other currency) shall, with the consent
of the Required Secured Parties, be applied to the
prompt payment of the cost of the repair, replacement or
restoration of such damaged or destroyed asset. In the
event that the consent of the Required Secured Parties
shall not be granted pursuant to the provisions of the
immediately preceding sentence, then all such proceeds
shall be paid to the Security Trustee for application
according to the priorities set out in Clause 12.15.
(d) The Borrower will on and from the Economic Completion Date
cause:
(i) each Ghana Insurer with whom an Insurance Policy is
taken out to enter into and execute and deliver to the
Security Trustee an Assignment of Reinsurances and the
"NOTICE TO REINSURERS" in the form of Part 1 of Schedule
2 of the Assignment of Reinsurances;
(ii) at least ninety percent (90%) of the risk insured by
such Insurance Policy to be reinsured with non-Ghanaian
reinsurers acceptable to the Security Trustee (acting
reasonably);
(iii) each such reinsurer to execute and deliver to the
Security Trustee an acknowledgement in the form of Part
2 of Schedule 1 of the Assignment of Reinsurances; and
(iv) legal opinions in form and substance, and from legal
counsel acceptable to the Security Trustee in respect of
each Assignment of Reinsurances to be delivered with
each Assignment of Reinsurances referred to in
sub-clause (i).
5.9 BOOKS, RECORDS AND INSPECTION
Each Obligor will:
(a) keep financial records and statements reflecting all of its
business affairs and transactions in accordance with GAAP;
(b) on not less than three days prior written notice where no
Default has occurred and on not less than 24 hours prior notice
where a Default has occurred, permit the Independent Engineer,
the Insurance Consultant, the Finance Parties or any of their
respective representatives to inspect the Mine or any other
location where personnel or records are located, to discuss its
financial matters with its officers, its banks and its
accountants and to examine (and photocopy extracts from) any of
its books or other corporate records or any Instrument, document
or correspondence relating to any of the Project Documents;
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(c) without limiting the generality of the foregoing, provide all
relevant and necessary assistance to the Independent Engineer
and the Insurance Consultant in connection with the performance
of the duties of the Independent Engineer and the Insurance
Consultant contemplated hereby;
(d) (in the case of the Borrower) pay any fees of such accountant
and the Independent Engineer and the Insurance Consultant and
out-of-pocket expenses of the Finance Parties incurred in
connection with the exercise of their rights pursuant to this
Clause.
5.10 PROJECT COMPLETION AND MANAGEMENT
The Borrower will ensure that the Project is carried out and completed
with due diligence and efficiency and is operated, maintained, developed
and consummated in accordance with the Development Plan (when
effective), Applicable Laws and sound mining and business practice, and
will ensure that Project Output is produced and processed in accordance
with Applicable Laws, sound mining and business practice and, when
produced, the Development Plan.
5.11 PRICE PROTECTION AGREEMENTS
At all times during the Required Price Protection Period, the Borrower
shall provide evidence to the Facility Agent to the effect that:
(a) it has directly entered into; or
(b) the Sponsor or the Holding Company has entered into and assigned
or novated to the Borrower and the Security Trustee shall have
been granted a first lien in respect of the Borrower's rights
under; or
(c) the Sponsor has undertaken on terms satisfactory to the Lenders
to procure that the Borrower enters into
Committed Price Protection Agreements reasonably acceptable to the
Required Secured Parties or put options or other similar uncommitted
transactions with respect to the sale of Gold (together with such
Committed Price Protection Agreements, collectively, the "PRICE
PROTECTION AGREEMENTS") which are in form and effected with
counterparties (the "PRICE PROTECTION COUNTERPARTIES") and at a strike
price reasonably satisfactory to the Facility Agent (acting on the
instructions of the Required Lenders) such that the proceeds thereof
(both as to the amount and to the timing), or in the case of put
options, the realised price for Ounces is sufficient to discharge in
full all Project Costs (excluding, however, Project Capital Costs in
respect of Price Protection Agreements and Project Capital Costs
scheduled to be incurred in connection with the construction of the
Project for the period prior to the Economic Completion Date, whichever
occurs first) for the Required Price Protection Period in effect at such
time (such Project Costs, the "PRICE PROTECTION PROJECT COSTS");
provided, however, that if the Sponsor enters into a Price Protection
Agreement, that the Borrower is not also party to as a counterparty to
the Sponsor, then the Sponsor must (and the Borrower shall procure that
the Sponsor shall) assign or novate to the Borrower by way of sale the
benefit of such Price Protection Agreement, and provided further that
the Sponsor and the Facility Agent may agree a Gold Price level above
which the Borrower shall not be required to comply with Clause 5.11(a)
or 5.11(b).
5.12 PROVISION OF STAFF
The Borrower shall on and from the date hereof ensure that there are
sufficient competent technical and management employees engaged in
connection with the Mine and the Project for the operation, development
and maintenance of the Mine substantially in accordance with (if
effective) the Development Plan.
5.13 ENVIRONMENTAL COVENANTS
(a) The Borrower will, and will use all reasonable efforts to ensure
that each other Project Party will:
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(i) use and operate the Mine, the Project Assets and all of
the facilities and properties related thereto in
compliance with, keep all Approvals relating to
environmental matters in effect and remain in compliance
with, and handle all Hazardous Materials in compliance
with, the Environmental Review Standards and with all
applicable Environmental Laws and Environmental
Licences, the breach of which could reasonably be
expected to lead to:
(x) any action being taken against the Sponsor or
the Borrower or any other Project Party by any
Governmental Agency or any other person; or
(y) a Materially Adverse Effect occurring with
respect to the Sponsor or the Borrower; and
(ii) immediately notify the Security Trustee and provide
copies upon receipt of all written claims, complaints,
notices or inquiries relating to the condition of the
facilities and properties related to the Mine and the
Project Assets or compliance with the Environmental
Review Standards or Environmental Laws or Environmental
Licences relating to the Project in either case which
could reasonably be expected to result in:
(x) any material action being taken against such
Obligor by any Governmental Agency or any other
person; or
(y) a Materially Adverse Effect occurring with
respect to the Borrower,
and shall promptly cure any non-compliance which is the
subject matter of any actions and proceedings relating
to such Environmental Review Standards or Environmental
Laws or Environmental Licences.
(b) Without prejudice to clause (a), the Borrower shall:
(i) use and operate all of its facilities and properties in
compliance with all Environmental Laws, keep all
necessary permits, approvals, certificates, licences and
other authorisations relating to environmental matters
in effect and remain in compliance therewith, and handle
all Hazardous Materials in material compliance with all
applicable Environmental Laws or Environmental Licences
where failure to so comply would reasonably be expected
to result in:
(x) any action being taken against any Obligor by
any Governmental Agency or any other person; or
(y) a Materially Adverse Effect with respect to any
Obligor; and
(ii) provide such information and certifications which any
Finance Party may reasonably request from time to time
to evidence compliance with this clause.
5.14 MAINTENANCE OF PROJECT ASSETS
The Borrower will maintain, preserve, protect and keep:
(a) all of its ownership, lease, use, licence and other interests in
the Project Assets (including all Mining Rights) as are
necessary for it to be able to operate the Mine substantially in
accordance with sound mining and business practice and, from the
Economic Completion Date, in a manner such that the requirements
of, and projections contained in, the Development Plan, can be
achieved where failure to maintain, preserve, protect and keep
such may lead to a Materially Adverse Effect; and
(b) all of the Project Assets owned by it in good repair, working
order, and condition, and make necessary and proper repairs,
renewals, and replacements so that the business carried on in
connection therewith may be properly conducted at all times,
unless the continued
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maintenance of any of such Project Assets is no longer necessary
or economically desirable for the operation of the Mine, such
operation to be substantially in accordance with sound mining
and business practice.
5.15 PARI PASSU
Each Obligor will ensure that its payment Obligations under this
Agreement and each other Finance Document to which it is a party rank at
least pari passu in right of payment with all of such Obligor's present
and future other unsecured indebtedness, other than any such
indebtedness which is preferred by mandatory provisions of Applicable
Law or any Finance Document.
5.16 ACCURACY OF INFORMATION
All factual information hereafter furnished by or on behalf of any
Obligor in writing to any Finance Party for the purposes of or in
connection with this Agreement or any transaction contemplated hereby
will be true and accurate in all material respects on the date as of
which such information is dated or certified and such information shall
not be incomplete by omitting to state any material fact necessary to
make such information not misleading in any material respect.
5.17 PROJECT DOCUMENTS
The Borrower undertakes to ensure that, except to the extent expressly
permitted pursuant to this Agreement or any other Finance Document:
(a) it will not enter into any Material Agreement without the prior
written consent of the Security Trustee (not to be unreasonably
withheld); provided that (a) the Borrower shall give the
Security Trustee not less than 14 Business Days notice prior to
entering into a Material Agreement not previously agreed, (b)
not enter into a Material Agreement except in the form
previously agreed, nor shall it agree to any condition thereto,
(c) any agreement dealing solely with an expense referred to in
the Development Plan shall be deemed approved if it is not a
Project Document (or a replacement for a Project Document)
provided such agreement is governed by English or Ghanaian law
and contains an express consent to assign by way of security and
by way of sale, and (d) in each other case, the Security Trustee
shall be deemed to have approved any Material Agreement if it
has not rejected it within 5 Business Days of its receipt.
(b) to the extent reasonably within its control, any other relevant
Project Party observes their respective obligations under all
Project Documents in all material respects;
(c) it does not, other than with the prior written consent of the
Security Trustee, abandon, settle, compromise or discontinue or
become non-suited in respect of proceedings against any party in
connection with a Project Document; and
(d) it takes the action that a prudent, diligent and reasonable
person would take to cause each party to a Project Document to
observe and perform its obligations in connection with that
Project Document, and if that party defaults in the performance
of those obligations to take the action that a prudent, diligent
and reasonable person would take to enforce its resulting rights
thereunder, unless the Security Trustee agrees otherwise in
writing.
5.18 SALE OF PRODUCTION
The Borrower will ensure that on and from the New Ownership Date:
(a) all Project Output is, subject to the Borrower's obligations
under any Price Protection Agreements, sold for the best
obtainable purchase price provided that, for the avoidance of
doubt, on any date, a price not less than the London Gold Price
on such date shall be considered to be the best available price
on such date;
(b) the proceeds of such purchase price are denominated in Dollars;
and
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(c) subject to the terms of this Agreement and if required by Clause
3.2(b), such proceeds are promptly deposited directly into the
Trust Account.
5.19 RETENTION OF RECORDS
The Borrower shall retain until at least six years after their creation
all records (including payroll records, invoices, bills and receipts)
evidencing income and expenditure on account of the Project.
5.20 LEASES
The Borrower shall observe and perform all covenants in any lease which
are on its part to be observed or performed and exercise any option to
renew any lease to which it is entitled if such renewal would be to its
advantage.
5.21 AUDIT OF ACCOUNTS
Each Obligor will procure that its accounts are audited (in the case of
any Obligor other than the Borrower, as part of a consolidated audit or
a stand alone audit) at least once in every calendar year by the
Auditors.
5.22 PERFECTION OF LIENS
Each Obligor shall:
(a) take all necessary steps to create and perfect the liens created
by the Security Agreements to which it is a party with respect
to future assets covered by the Security Agreements to which it
is a party;
(b) maintain the Security Agreements to which it is a party in full
force and effect at all times (including the priority thereof);
(c) preserve and protect the assets comprising the Security
Agreements to which it is a party; and
(d) protect and enforce its rights and title to all such assets
subject to the Security Agreements to which it is a party.
5.23 TRANSACTIONS
The Borrower shall not (except in the ordinary course of business)
without the previous written consent in writing of the Security Trustee
enter into any transaction under which:
(a) title to goods supplied to the Borrower is reserved to the
vendor thereof until payment by the borrower for such goods;
and/or
(b) the proceeds of sale by the Borrower on any goods are held in
trust for the supplier thereof or for the supplier of any
ingredient thereof.
6. NEGATIVE COVENANTS
6.1 CERTAIN NEGATIVE COVENANTS
Each Obligor party to this Agreement from time to time agrees with each
Finance Party that on and from the New Ownership Date, until all
Commitments have terminated and all Obligations have been paid and
performed in full, it will perform its obligations set forth in this
Clause.
6.2 BUSINESS ACTIVITIES; PLACE OF BUSINESS; ORGANIC DOCUMENTS; FISCAL YEAR.
(a) The Borrower (and, in the case of clauses (ii) and (iii), each
Obligor) will not:
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(i) engage in any business activity other than the
consummation of the Project and the operation of the
Mine in accordance with the Development Plan (when
produced pursuant to Clause 2.3), the activities
contemplated by this Agreement and the other Finance
Documents and any activity incidental thereto; or
(ii) maintain any place of business without first taking (to
the satisfaction of the Security Trustee) all actions
necessary to protect the liens granted pursuant to the
relevant Security Agreements to which it is a party; or
(iii) establish or maintain a place of business in the United
Kingdom or become resident in the United Kingdom for
taxation purposes unless it has satisfied prior to
establishing or maintaining such place of business (as
evidence by the prior written consent of each Secured
Party) each Finance Document to which it is a party will
remain valid, binding and enforceable thereafter; or
(iv) without the prior written consent of the Facility Agent,
change its domicile or residence from Ghana.
(b) Neither the Borrower nor the Holding Company will (without first
obtaining the prior written consent of the Security Trustee,
such consent not to be unreasonably withheld or delayed):
(i) change, or permit any change to, its corporate name or
to any material provision of its Organic Documents; or
(ii) change its Fiscal Year.
6.3 INDEBTEDNESS
Each of the Borrower and the Holding Company will not create, incur,
assume, or suffer to exist or otherwise become or be liable in respect
of any indebtedness other than:
(a) indebtedness in respect of the Loans and its other Obligations;
(b) indebtedness in respect of the Price Protection Agreements
entered into by the Borrower in accordance with Clause 5.11 or
in the case of the Borrower, other Price Protection Obligations
incurred in the ordinary course of business;
(c) in the case of the Borrower, indebtedness in respect of the
other Operative Documents;
(d) in the case of the Borrower, at any date:
(i) unsecured indebtedness outstanding at such date incurred
in the ordinary course of business in connection with
Project Costs by way of open accounts of less than 90
days extended by suppliers, or letters of credit opened
for the account of suppliers, on normal trade terms in
connection with purchases of goods and services (and
excluding, for the avoidance of doubt, financial
indebtedness); or
(ii) indebtedness (other than indebtedness falling within
clauses (c) or (d)(i)) not in excess of U.S.$500,000 in
aggregate at any one time outstanding (or the equivalent
thereof in any other currency) incurred prior to the
Economic Completion Date to suppliers of equipment and
other personal property constituting Project Capital
Costs in respect of the deferred purchase price of such
equipment;
(e) indebtedness in respect of taxes, assessments or governmental
charges not in excess of U.S.$100,000 in aggregate, and
indebtedness in respect of claims for employment, materials or
supplies to the extent that payment thereof shall not at the
time be required to be made in accordance with the provisions of
Clause 5.7;
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(f) indebtedness in respect of judgements or awards, the enforcement
of which has been stayed (by reason of a pending appeal or
otherwise) for a period of more than 30 days, which do not, in
aggregate, exceed $50,000 (or the equivalent thereof in any
other currency);
(g) in the case of the Borrower, Approved Subordinated Indebtedness;
and
(h) in the case of the Borrower, Approved Project Indebtedness.
6.4 LIENS
Each of the Borrower and the Holding Company will not create, incur,
assume or suffer to exist any lien upon any of its properties, revenues
or assets, whether now owned or hereafter acquired, except the following
(each a "PERMITTED LIEN"):
(a) in the case of any Obligor, liens in favour of the Security
Trustee (for the benefit of the Finance Parties, subject to the
terms of the Finance Documents) or in favour of the Finance
Parties granted pursuant to any Finance Document, subject to the
terms of the Finance Documents;
(b) liens for taxes, assessments or other governmental charges or
levies not in excess of U.S.$100,000 and not at the time
delinquent or thereafter payable without penalty or being
contested in good faith by appropriate proceedings and for which
it shall have complied with Clause 5.7(b)(ii);
(c) liens incurred in the ordinary course of business in connection
with unemployment insurance or other forms of governmental
insurance or benefits, or to secure performance of tends,
statutory obligations, leases and contracts (other than for
financial indebtedness) entered into in the ordinary course of
business or to secure obligations on surety or appeal bonds;
(d) in the case of the Borrower, liens granted to secure Approved
Project Indebtedness provided the terms of such liens, if
granted prior to the Discharge Date, have been approved in
writing by each Lender and the holder of such lien has entered
into an intercreditor agreement with the Security Trustee and
each Lender, the terms of which are satisfactory to each Lender;
and
(e) any other lien disclosed in Item 7 ("LIENS") of the Disclosure
Schedule;
and, for the purposes of this Clause the obligations secured by any lien
created or incurred in the ordinary course of business, in the case of
the Borrower or the Holding Company may not exceed U.S.$100,000 in the
aggregate at any one time outstanding.
6.5 CAPITAL EXPENDITURES
The Borrower will not incur or commit to incur any costs in respect of
Capital Expenditures other than such costs which have been incurred with
the prior written consent of the Security Trustee or are identified in
the Development Plan or the Monthly Budget or, in any Fiscal Year, do
not exceed $50,000 in aggregate and shall not incur or commit to incur
any such costs if, at the time, or as a consequence of, incurring any
such item of expenditure any Default shall have occurred and be
continuing; provided, however, that, if any such Default shall have
occurred and be continuing, the Borrower may make Capital Expenditures
constituting Required Completion Expenditures and Required Capital
Expenditures; and provided further, that, the Borrower may incur Capital
Expenditures (not in excess of $100,000 (or for such higher amount
incurred with the prior written consent of the Security Trustee, not to
be unreasonably withheld)) where such expenditure is incurred solely so
as to avoid danger to life or Project Assets or to comply with Ghanaian
Applicable Law.
6.6 INVESTMENTS AND SUBSIDIARIES
The Borrower will not acquire all or substantially all of the assets of
any other person and will not make, incur, assume or suffer to exist any
Investment in any other person.
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6.7 RESTRICTED PAYMENTS, ETC.
Neither the Borrower nor the Holding Company will:
(a) declare, pay or make any distribution (in cash, property or
obligations) on any shares of any class of capital stock (now or
hereafter outstanding) of the Borrower or the Holding Company or
on any ownership interest of the Borrower or the Holding Company
or on any warrants, options or other rights with respect to any
shares of any class of capital stock of, or other ownership
interest (now or hereafter outstanding) in the Borrower or the
Holding Company or apply any of its funds, property or assets to
the purchase, redemption or other retirement of any shares of
any class of capital stock of, or other ownership interest (now
or hereafter outstanding) in the Borrower or the Holding
Company, or warrants, options or other rights with respect to
any shares of any class of capital stock of, or other ownership
interest (now or hereafter outstanding) in the Borrower or the
Holding Company;
(b) repay, redeem, purchase or otherwise defease any indebtedness
owing to, or make any other payment to, any affiliate (including
Approved Subordinated Indebtedness);
(c) make any deposit for any of the foregoing purposes or otherwise
discharge any indebtedness incurred by any affiliate; or
(d) otherwise make any payment to any affiliate of the Holding
Company or the Borrower (except, after the Release Date and
prior to the occurrence of a Default, management fees of up to
U.S.$20,000 per month (or any other amount agreed in writing
between the Security Trustee and the Borrower) (plus any
reasonable and documented out of pocket expenses) payable to the
Sponsor pursuant to the Management Agreement),
other than, in each case, a Permitted Distribution made on a
Cash Sweep Date.
6.8 TAKE OR PAY CONTRACTS
The Borrower will not enter into or be a party to any arrangement for
the purchase of materials, supplies, other property or services if such
arrangement by its express terms requires that payment be made by it
regardless of whether or not such materials, supplies, other property or
services are delivered or furnished to it. For the avoidance of doubt,
nothing in this Clause shall prohibit the Borrower from entering into
any Price Protection Agreement.
6.9 MERGERS AND ACQUISITIONS
Neither the Borrower nor the Holding Company shall enter into any
amalgamation, demerger, merger or reconstruction without the prior
written consent of the Security Trustee.
6.10 ASSET DISPOSITIONS, ETC.
The Borrower will not sell, transfer, lease or otherwise dispose of any
of, or grant options, warrants or other rights with respect to, any of
its assets (including accounts receivable) to any person, unless:
(a) such disposition is of dore bullion in the ordinary course of
business made under the terms of the Refining and Purchase
Agreement or otherwise pursuant to arrangements with refineries
which are satisfactory to the Required Secured Parties;
(b) such disposition is of obsolete assets which are no longer used
or useful to the Borrower or of assets which are to be replaced
provided that such disposition is in accordance with the Annual
Budget (without Material Deviation) and the Development Plan; or
(c) the net book value of all assets disposed of by the Borrower
(excluding, however, assets disposed of pursuant to clauses (a)
and (b)) in the same Fiscal Year does not exceed U.S.$100,000
(or the equivalent thereof in any other currency) provided fair
value in cash or other assets are received therefor.
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6.11 TRANSACTIONS WITH AFFILIATES
The Borrower will not enter into, or cause, suffer or permit to exist:
(a) any arrangement or contract pursuant to which any indebtedness
is extended by the Borrower to any of its affiliates as obligor;
(b) any arrangement or contract with any of its affiliates of a
nature customarily entered into by persons which are affiliates
of each other (including management or similar contracts or
arrangements relating to the allocation of revenues, taxes and
expenses or otherwise) requiring any payments to be made by the
Borrower to any affiliate unless such arrangement is fair and
equitable to the Borrower; or
(c) any other transaction, arrangement or contract with any of its
other affiliates which would not be entered into by a prudent
person in the position of the Borrower with, or which is on
terms which are less favourable to such person than are
obtainable from, any person which is not one of its affiliates,
provided that the Borrower may:
(A) enter into arrangements and contracts with its
affiliates in Ghana in respect of goods and
services actually provided and specifically
referred to in an Annual Budget or Development
Plan as intercompany debt provided that from the
Economic Completion Date the net intercompany
indebtedness owed to or by the Borrower
(provided such indebtedness of the Borrower is
Approved Subordinated Indebtedness) shall be
promptly settled within 15 days of the end of
each month end. Prior to the Economic Completion
Date such intercompany indebtedness of the
Borrower shall be funded by the Sponsor as an
additional shareholder loan to the Borrower; and
(B) enter into a Management Agreement with the
Manager pursuant to which management fees/costs
of $45,000 per month will be invoiced and, from
the Economic Completion Date until the
occurrence of a Default, up to $20,000 per month
may be paid on a monthly basis, and the balance
of $25,000 (plus any accrued interest
thereunder) paid only as a Permitted
Distribution.
6.12 RESTRICTIVE AGREEMENTS, ETC.
No Obligor will enter into any agreement (excluding this Agreement and
the other Finance Documents):
(a) prohibiting the creation or assumption of any lien upon its
properties, revenues or assets, whether now owned or hereafter
acquired; and
(b) restricting the ability of such Obligor to amend or otherwise
modify this Agreement or any other Operative Document.
6.13 INCONSISTENT AGREEMENTS
No Obligor will enter into any agreement containing any provision which
would be violated or breached by the making of the Loans or by the
performance by such Obligor of its obligations hereunder or under any
other Operative Document.
6.14 PROJECT DOCUMENTS
No Obligor shall, without the prior written consent of the Security
Trustee:
(a) amend, modify or waive any provision of any Project Document to
which it is a party; or
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(b) terminate (other than in accordance with its terms (excluding,
however, as a result of the breach of any obligation by any
party thereto)) or replace, any Project Document to which it is
a party, provided that if a Contractor has defaulted under any
Project Document or such Project Document has expired, the
Borrower may within 45 days of such default or expiry replace
such Contractor with another Contractor acceptable to the
Security Trustee on substantially similar terms to such Project
Document.
6.15 ACTIONS UNDER PROJECT DOCUMENTS
No Obligor will take or refrain from taking any action under any of the
Project Documents which would have a material adverse effect on (a) the
ability of the Borrower to consummate the Project and operate the Mine
in accordance with the Development Plan, (b) any collateral subject to
any Security Agreement and the perfection and priority of the liens
granted or purported to be granted therein, or (c) the ability of such
Obligor to pay and perform its Obligations.
6.16 ROYALTY AGREEMENTS
No Obligor will enter into any agreement relating to the granting of
royalties or net profits interests in connection with the Project other
than as set forth in the royalty agreements listed in Item 9 ("ROYALTY
AGREEMENTS") of the Disclosure Schedule.
7. EVENTS OF DEFAULT
7.1 EVENTS OF DEFAULT
The term "EVENT OF DEFAULT" shall mean any of the events set forth in
this Clause:
(a) NON-PAYMENT OF OBLIGATIONS
(i) The Borrower shall default in the payment, repayment or
prepayment when due of any principal amount of or
interest on any Loan (or within three Business Days for
the due date for payments thereof in the case of any
such principal or interest where such failure is due to
a technical or administrative difficulty in payment of
funds); or
(ii) Any Obligor shall default in the payment when due of any
other Obligation (and such default shall continue
unremedied for a period of three Business Days).
(b) NON-PERFORMANCE OF CERTAIN COVENANTS
(i) The Borrower shall default in the due performance and
observance of any of its obligations pursuant to Clause
2.1 and such default shall continue unremedied for 30
days;
(ii) any Obligor shall default in the due performance and
observance of any of its obligations under Clauses
3.3(a), 5.5, 5.15, 5.18 or 6.2(a)(ii) and 6.2(a)(iii),
6.3, 6.4, 6.7, 6.9, 6.11 or 6.14;
(iii) the Sponsor shall default in the due performance and
observance of any of its obligations under the Support
Agreement; or
(iv) any Obligor shall default in the due performance and
observance of any of its obligations under any
Subordination Agreement.
(c) NON-PERFORMANCE OF OTHER OBLIGATIONS
Any Obligor or the Ghana Insurer shall default in the due
performance or observance of any term, condition, covenant or
agreement contained herein or in any other Finance Document
executed by it (other than a default referred to in Clause
7.1(a) or 7.1(b)), and, if capable of cure or remedy, such
default shall continue unremedied for a period of 15 Business
Days.
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(d) BREACH OF REPRESENTATION OR WARRANTY
Any representation or warranty of any Obligor or the Ghana
Insurer made hereunder or under any other Operative Document
executed by it or in any other writing furnished by or on behalf
of such person to any Finance Party for the purposes of or in
connection with this Agreement or any Finance Document is or
shall be incorrect in any material respect when made.
(e) DEFAULT ON OTHER INDEBTEDNESS
A default shall occur in the payment when due (subject to any
applicable grace period), whether by acceleration or otherwise,
of any indebtedness (other than indebtedness described in Clause
7.1(a)) on the part of the Borrower, the Holding Company or the
Sponsor which has a principal amount, individually or in the
aggregate, in excess of U.S.$250,000 (or the equivalent thereof
in any other currency), or a default shall occur in the
performance or observance of any obligation or condition with
respect to such indebtedness if such default shall continue
unremedied for any applicable period of time sufficient to
permit the holder or holders of such indebtedness, or any
trustee or agent for such holders, to cause such indebtedness to
become due and payable prior to its expressed maturity.
(f) BANKRUPTCY, INSOLVENCY, ETC.
(i) Any Obligor is unable to pay its debts as they fall due,
commences negotiations with any one or more of its
creditors with a view to the general readjustment or
rescheduling of its indebtedness or makes a general
assignment for the benefit of or a composition with its
creditors; or
(ii) any Obligor, or any other person, takes any action, or
other steps are taken or legal proceedings are started,
for the winding-up, dissolution or reorganisation (other
than a solvent reorganisation on terms previously
approved in writing by the Security Trustee) of any
Obligor or for the appointment of an examiner, receiver,
liquidator, administrator, administrative receiver,
manager or similar external officer for it or of any or
all of its assets; or
(iii) any action or proceeding similar to those described in
clause (i) or (ii) shall occur with respect to, or be
initiated by or against, any Obligor in any
jurisdiction.
(g) PRICE PROTECTION AGREEMENTS
Any default shall occur under any Price Protection Agreement or
any Price Protection Agreement shall terminate (other than with
the prior consent of the Required Secured Parties) or cease in
whole or in part to be the legal, valid and binding obligation
of any party thereto.
(h) PROJECT DOCUMENTS, ETC.
(i) Any of the Project Documents (excluding any Price
Protection Agreement (which is a Project Document) shall
terminate (other than in accordance with its terms in
circumstances where no default in the performance by the
Borrower of its obligations thereunder has occurred and
is continuing) or for any reason cease to be in full
force and effect, except for:
(A) any expiration at the end of the term thereof;
(B) any termination permitted pursuant to Clause (b)
of Clause 6.14; or
(ii) a default (after giving effect to any applicable grace
period) by any person under any of the Project Documents
shall occur or any Obligor shall terminate the services
of any Contractor under a Project Document, and such
default or termination could (in the reasonable opinion
of the Required Secured Parties) be expected to have a
Materially Adverse Effect with respect to the Borrower,
the Holding Company or the Sponsor; and the relevant
Obligor fails to obtain a satisfactory alternative
agreement
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or alternative arrangements to satisfactorily mitigate
(in the opinion of the Required Secured Parties) the
effect of such default or termination within 30 days of
such default or termination.
(i) IMPAIRMENT OF FINANCE DOCUMENTS
This Agreement or any other Finance Document shall terminate
(other than in accordance with its terms (excluding however, as
a result of the breach of any obligation by any party thereto))
or cease in whole or part to be the legal, valid, binding and
(except in the case of a Subordination Agreement, subject to
bankruptcy and insolvency laws and other similar laws of
applicability to creditors generally and to general equitable
principles) enforceable obligation of any Obligor party thereto,
or a Ghanaian Insurer; any Obligor, a Ghanaian Insurer or any
other party shall, directly or indirectly, contest in any manner
the effectiveness, validity, binding nature or enforceability of
any Finance Document; or any lien securing any Obligation shall,
in whole or in part, cease to be a perfected lien which, except
as referred to in Clause 4.4(b) (i) or (ii), ranks first in
priority.
(j) ABANDONMENT; MINING RIGHTS
(i) The Borrower shall abandon all or any significant
portion of its interest in the Mine or any Project
Assets owned by it or surrender, cancel or release, or
suffer any termination or cancellation of any of its
rights or interest in the Mine or the Project Assets
owned by it, other than as:
(A) specifically permitted by this Agreement and
each other Finance Document;
(B) in order to affect an orderly closure of the
Mine following the Discharge Date where each
Royalty Holder has agreed in writing to such
orderly closure; or
(C) as the Borrower shall have evidenced to each
Secured Party's reasonable satisfaction is not
required in connection with the Project.
(ii) Any person other than the Borrower shall acquire Mining
Rights in respect of all or any portion of properties
relating to the Project other than where the Government
of Ghana has granted Mining Rights to another person in
respect of substances other than Gold or other precious
metals pursuant to any Applicable Law in Ghana and the
grant or exploitation of such Mining Rights does not
have a Materially Adverse Effect on the Borrower.
(k) JUDGMENTS
Any:
(i) judgment or order (including any appeal referred to in
sub-clause (C)) for the payment of money in excess of
U.S.$50,000, shall be rendered against any Obligor,
unless:
(A) such judgment or order is set aside or paid
within 14 days; or
(B) in respect of which an amount not less than the
maximum amount payable in respect of such
judgment or order has been lodged in an account
in London with the Security Trustee and which is
subject to a first ranking lien in favour of the
Security Trustee; or
(C) that enforcement of such judgment or order has
been stayed and such judgment or order is
subject to an appeal and the relevant Obligor
has demonstrated to the satisfaction of the
Required Secured Parties (acting reasonably)
that it has reasonable prospects of success with
such appeal and the financial capacity to make
such payment and meet all its Obligations; or
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(ii) levy of any execution, distress, sequestration or other
process upon or against any of the assets or property of
any Obligor which is not paid out or discharged within
seven days.
(l) EXPROPRIATION, ETC.
Any Governmental Agency or other person purporting to be, or
acting as, any Governmental Agency condemns, nationalises,
seizes or otherwise expropriates:
(i) all or any material part of the property or other assets
of any of the Borrower, the Holding Company or the
Sponsor or of its share capital or other ownership
interests, or assumes custody or control of such
property or other assets or of the business or
operations of any of the Borrower, the Holding Company
or the Sponsor if such action (together with any prior
similar action) would prevent any of the Borrower, the
Holding Company or the Sponsor from carrying on its
obligations under the Operative Documents or would
otherwise prevent any of the Borrower, the Holding
Company or the Sponsor from carrying on its business in
the ordinary course;
(ii) all or any material part of any other property or assets
necessary for the Project, and such condemnation,
nationalisation, seizure, expropriation, assumption or
action is not withdrawn, rescinded, reversed, or in the
case of any such action with respect to property or
assets, the same are not replaced with equivalent
property or assets within 30 days; or
(iii) any Charged Shares (other than as a result of a
Permitted Expropriation).
(m) CHANGE IN CONTROL, ETC.
(i) Any Change in Control shall occur; or
(ii) any single person, or group of persons acting in concert
(as defined in the City Code on Take-overs and Mergers),
acquires (without the prior written consent of the
Security Trustee, acting on the instructions of the
Secured Parties (acting reasonably)) 51% of the voting
equity of the Sponsor.
(n) DEFAULT, ETC. BY CONTRACTORS
Any Contractor shall default in the performance of any of its
material obligations under any Operative Document to which it is
a party, and:
(i) such Contractor shall not have remedied such default
within the time (if any) prescribed under the relevant
Operative Document; or
(ii) such Contractor shall not have been replaced in
accordance with the proviso to Clause 6.14(b).
(o) APPROVALS
Any Approval which is relevant to the Project or the Mine or
otherwise relevant to the conduct of the business of the
Borrower or the performance of any obligations of any Obligor
under any Operative Document executed by it shall be denied or
withdrawn or shall cease to remain in full force and effect or
shall otherwise be materially impaired and the effect of such
action is reasonably likely to result in (i) a Materially
Adverse Effect with respect to any Obligor, or (ii) any material
action being taken against any Obligor by any Governmental
Agency or any other person.
(p) DEVIATION FROM DEVELOPMENT PLAN
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Without prejudice to the provisions of Clause 5.10, the Borrower
shall after the New Ownership Date develop the Project in a
manner other than as substantially contemplated by (on or after
the Economic Completion Date) the Development Plan or (prior to
the Economic Completion Date) the Annual Budget (including as a
result of the incurrence of any indebtedness of the nature
referred to in Clause 6.3).
(q) CEASE TO CARRY ON BUSINESS
The Borrower, the Holding Company or the Sponsor ceases, is
restrained from or threatens to cease, to carry on its business
or a substantial part thereof in the ordinary course (including,
in the case of the Borrower, the Mine) and in the case of any
restraint caused by a person other than the relevant Obligor,
such Obligor does not recommence its business as aforesaid
within 30 days (and, for the avoidance of doubt, the Borrower
shall be deemed to have ceased to carry on the Project in the
ordinary course if it suffers a loss of all or substantially all
of its assets).
(r) UNENFORCEABILITY OF FINANCE DOCUMENTS
This Agreement or any other Finance Document becomes wholly or
partially void or voidable or is claimed to be so or is
repudiated, in each case, by an Obligor or a Ghana Insurer or
anyone on such party's behalf.
(s) TAX DEMAND
The Ghanaian Inland Revenue shall make a demand on the Borrower
pursuant to any provision of the Ghanaian Inland Revenue Act and
the Borrower has not in respect of the amount payable or
claimed, complied with Clause 5.7(b)(ii) within 5 Business Days
of such demand.
7.2 ACTION IF EVENT OF DEFAULT
If any Event of Default shall occur for any reason, whether voluntary or
involuntary, and be continuing, the Facility Agent or any Royalty Holder
(subject to any agreement between the Secured Parties and subject to
Clause 10) may, in the case of the Facility Agent, take any action
permitted pursuant to Clause 17.1 of the Loan Agreement, and, in the
case of the First Royalty Holder, take any action permitted to be taken
by it pursuant to Clause 6.1 of the First Royalty Agreement, and in the
case of any other Royalty Holder, take action permitted to be taken by
any provision in its Royalty Agreement which is substantially similar to
Clause 6.1 of the First Royalty Agreement.
8. INTERCREDITOR PROVISIONS
8.1 OTHER AGREEMENTS
The provisions of this Clause 8 shall, as between any of the Secured
Parties, be subject to any other agreement between such Secured Parties.
8.2 NUMBER OF VOTES ATTACHING TO EACH PARTICIPATION
The voting entitlement of any Secured Party in any vote which may be
cast in relation to any decision or vote to be taken on any date (a
"VOTING ENTITLEMENT") shall:
(a) in relation to each Lender:
(i) if the vote or decision is to be taken on a date during
any Availability Period for any Facility which has not
expired and when the Commitments for such Facility have
not been cancelled or reduced to zero, be equal to the
Commitment (disregarding any drawdowns) of the relevant
Lender, expressed as a percentage of:
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(A) the aggregate Commitment for all Lenders
(disregarding any drawdowns) on that date; plus
(B) the aggregate Royalty Principal Amount in
respect of all Royalty Holders,
in each case on such date; or
(ii) (if the vote or decision is to be taken after all
Availability Periods have expired or after the aggregate
Commitments have been cancelled or reduced to zero) be
equal to the amount of Liabilities owing to such Lender,
expressed as a percentage of the aggregate of:
(A) the Liabilities which are owing to all Lenders
under the Loan Agreement, plus
(B) the Royalty Principal Amount;
in each case on such date; and
(b) in relation to each Royalty Holder, be equal to:
(i) if Clause 8.2 (a)(i) applies, the Royalty Principal
Amount in respect of such Royalty Holder on such date
expressed as a percentage of (A) the aggregate
Commitments (disregarding any drawdowns) of all Lenders,
plus (B) the aggregate Royalty Principal Amount in
respect of all Royalty Holders; or
(ii) if Clause 8.2(a)(ii) applies, the Royalty Amount in
respect of such Royalty Holder expressed as a percentage
of (A) the aggregate Liabilities of all Liabilities
which are owing to all Lenders under the Loan Agreement,
plus (B) the aggregate Royalty Principal Amount in
respect of all Royalty Holders.
8.3 VOTING BY SECURED PARTIES
Each Secured Party shall be entitled to use its Voting Entitlement as it
sees fit, subject only to this Agreement and, as between such Secured
party and any other Secured Party, any other agreement between any such
Secured Party and any such other Secured Party.
8.4 DECISION MAKING
Neither the Security Trustee, any Lender, the Facility Agent, any
Royalty Holder, nor any of them, shall exercise or enforce any right,
power or discretion, give any consent or any waiver, agree to any
amendment, or make any determination or notify the Borrower or any other
Obligor or any other Finance Party of any opinion under or in respect of
any provision of the Finance Documents except as permitted by and in
accordance with this Agreement.
8.5 NOTIFICATION OF REQUIREMENT TO TAKE DECISION
If, at any time, (i) the Security Trustee proposes to exercise any
discretion conferred on it in that capacity under the Finance Documents
or to do any act, or (ii) the Required Secured Parties notify the
Security Trustee of a matter in respect of which they consider that a
discretion of the Security Trustee should be exercised or an act should
be performed by the Security Trustee or (iii) any decision falls to be
made or discretion exercised or act carried out or not carried out by
the Security Trustee then the Security Trustee shall promptly notify
each Finance Party in writing of the matter in question:
(a) specifying, if relevant, the manner in which the Security
Trustee proposes to exercise the relevant discretion or the
manner in which it proposes to act (or not act);
(b) specifying the requisite voting majority required for the
decision; and
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(c) specifying the date by which the relevant Finance Parties must
provide it with instructions in relation to such decision. This
date must be not less than two Business Days after the date upon
which the Security Trustee gives such notice or such lesser
period as the Security Trustee having consulted, to the extent
practicable, with the Finance Parties, the interests of the
Finance Parties or any of them would otherwise be likely to be
prejudiced or the Security Trustee may, in its absolute
discretion, consider appropriate following due consideration of
any request from any Obligor.
8.6 VOTING RETURNS TO SECURITY TRUSTEE
Each Secured Party (in the case of the Lenders, acting through the
Facility Agent) who has a Voting Entitlement shall, within the time
period specified by the Security Trustee under Clause 8.5 provide a
statement setting out:
(a) if requested by the Security Trustee, (i) in the case of a
Lender, the aggregate of the Liabilities outstanding to it and,
(ii) in the case of any Royalty Holder, the Royalty Principal
Amount in respect of such Royalty Holder, in each case as at the
date of the notice served by the Security Trustee pursuant to
Clause 8.5;
(b) whether it has voted in favour of the matter in question and/or
against the matter in question; and
(c) directions to the Security Trustee as to the matter on which
instructions were sought under Clause 8.5.
If any Secured Party does not reply within the period specified by the
Security Trustee, the amount of its Voting Entitlement shall, unless the
Security Trustee otherwise determines and has in the notice specified
that this provision shall not apply, be disregarded for the purpose of
determining whether or not the requisite percentage vote has been
achieved.
8.7 INFORMATION CONCERNING DEFAULTS
In addition to and not in substitution for any notification requirements
contained in this or any other Finance Document, each of the Finance
Parties will notify the others (via the Facility Agent in the case of
the Lenders) of the occurrence of any Default or Event of Default, of
which any officer responsible for the transactions contemplated by this
Agreement and the other Finance Documents has actual knowledge, as soon
as reasonably practicable thereafter. No Finance Party shall incur any
liability to any other party to this Agreement by reason of any failure
by any party to give any notification required pursuant to this Clause.
8.8 AMOUNTS OF LIABILITIES
Each of the Finance Parties will on written request by any of the others
(via the Facility Agent, in the case of the Lenders) or from time to
time notify the other Finance Parties (via the Facility Agent, in the
case of the Lenders) in writing, of details of the amount of the
Liabilities owing to it so far as known to it at that time.
8.9 OTHER INFORMATION
Each Obligor authorises the Finance Parties to disclose to each other
all information relating to the Obligors which comes into the possession
of any of them in connection with the Finance Documents.
8.10 PRESERVATION OF DISCRETIONS
This Clause 8 shall not apply to those circumstances under which the
Security Trustee is given the discretion under this Agreement or any
other Finance Document to act without instructions from other Finance
Parties.
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8.11 REQUISITE MAJORITY
Where no voting majority is specified in this Agreement in respect of
any discretion conferred on the Security Trustee or any decision to be
made or discretion to be exercised or action taken (or not taken) by the
Security Trustee, then the Required Secured Parties shall be the
requisite voting majority.
8.12 OTHER PROVISIONS
Nothing in this Clause 8 shall prevent the Required Secured Parties from
giving instructions to the Security Trustee in accordance with Clause
12.9.
8.13 DECISIONS BINDING ON ALL PARTIES
Each decision taken in accordance with this Clause 8 or Clause 12.9
shall be binding on all parties to this Agreement.
9. MEETINGS
9.1 MEETING REQUISITIONS
The Security Trustee may requisition a meeting of the Finance Parties,
and either the Facility Agent or any Secured Party may by written notice
to the Security Trustee requisition a meeting of the Finance Parties, in
each case at any time in order to discuss any matter referred to in
Clause 9.2.
9.2 PURPOSE OF MEETING
The purpose of a meeting convened and held in accordance with the
provisions of Clause 9.1 (or any adjourned meeting) shall be to enable
the Finance Parties to consult with each other as to:
(a) any Default which has occurred and the action to be taken with
respect thereto (if any);
(b) potential or imminent Defaults or potential or imminent changes
in law or circumstances which may affect the Project or its
financing; and/or
(c) any other matter of relevance to the Project or its financing.
10. FINANCE PARTY ACTION FOLLOWING DEFAULTS OR EVENTS OF DEFAULT
10.1 NOTIFICATION TO SECURITY TRUSTEE
At any time after the occurrence of a Default, any Secured Party or the
Facility Agent on behalf of the Lenders may serve a notice on the
Security Trustee which gives particulars of the Default and instructs
the Security Trustee to seek instructions from the Required Secured
Parties as to whether or not such Default should be waived.
10.2 INSTRUCTIONS FROM LENDERS
If the Security Trustee receives any notice from a Secured Party or the
Facility Agent on behalf of the Lenders pursuant to Clause 10.1, it
shall promptly notify each of the other Finance Parties of such notice
(and provide a copy of such notice to each Finance Party) and request
instructions from the Required Secured Parties, in accordance with
Clause 8, as to whether or not the Default specified in such notice
should be waived, and:
(a) if the Required Secured Parties agree to waive such Default in
accordance with Clause 8, no Finance Party shall be entitled to
request the Security Trustee to exercise any or all of the
remedies set out in any Finance Document as a consequence only
of the occurrence of such Default; or
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(b) if the Required Secured Parties do not agree to waive such
Default, the Required Secured Parties may, in the case of an
Event of Default (unless prior to exercising such right such
Default is remedied to the satisfaction of the Required Secured
Parties), give notice from time to time to the Security Trustee
requiring it to exercise any of the remedies set out in any
Finance Document, unless it is specifically restricted from
doing so at such time by reason of any provision of this
Agreement.
10.3 AUTHORITY TO TAKE ACTION
Each of the Finance Parties agrees that the Security Trustee shall have
the sole and exclusive right to exercise any of the remedies granted in
favour of it under any Finance Document or (unless the Required Secured
Parties otherwise provide their prior written consent) to commence,
participate or intervene in, pursue, conclude or settle any legal,
insolvency, administrative, bankruptcy or other proceedings against, or
in respect of any Obligor or any property of the Obligor in any
jurisdiction on behalf of the Finance Parties or any of them in
connection with any of the Finance Documents or otherwise.
10.4 RESTRICTIONS ON FINANCE PARTY ACTION
Save as may otherwise be permitted by this Agreement, each of the
Finance Parties agrees that it does not have any right to, and that it
will not, and that no other person on its behalf or appointed by it
(with the exception of the Facility Agent or the Security Trustee acting
in accordance with this Agreement) will (unless the Required Secured
Parties otherwise provide their prior written consent):
(a) cancel, as a consequence of the occurrence of any Event of
Default, any Commitment; or
(b) directly or indirectly take any action of whatsoever nature
against any Obligor under or in respect of the Finance Documents
to which that Finance Party is a party, including the
commencement, continuance or voluntary joining in of any
proceedings or process in any court or other competent forum in
relation to any Obligor or in relation to any Finance Document;
or
(c) demand that any Liabilities owing to it (or to the Lenders, in
the case of the Facility Agent) under any Finance Document to
which it is a party be immediately due and payable; or
(d) take any other action under any Finance Document which would
require payments by any Obligor of any amount under such Finance
Document in advance of any scheduled payment date; or
(e) purport to set off, at any time, any amount of Liabilities owing
to it (or to any other Finance Parties) against any amount
payable by it to any Obligor; or
(f) except as otherwise expressly provided in this Agreement,
enforce any lien created by or pursuant to any of the Security
Agreements or exercise any rights or powers in relation to
enforcement conferred by any Security Agreements after the
security conferred thereby has become enforceable unless such
action is taken to preserve or protect (rather than to enforce)
such lien; or
(g) sell, repossess or take possession of any goods or assets of any
Obligor as a consequence of the occurrence of a Default; or
(h) take any action for the winding-up, liquidation, official
management, receivership or dissolution of any Obligor or any
analogous process; or
(i) levy distress against any Obligor or its property on account of
a Default or attach, levy execution, arrest or otherwise
exercise any creditor's process in respect of any asset of any
Obligor in respect of any Liabilities.
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10.5 NO BENEFIT TO OBLIGORS
None of the provisions of this Clause 10 are intended to benefit any
Obligor and no Obligor shall obtain any rights against any Finance Party
as a result of this Clause 10.
11. PRO RATA SHARING
11.1 REDISTRIBUTION
If any amount is discharged by payment, set-off or any other manner
other than in accordance with the provisions of Clause 3 or through the
Security Trustee in accordance with Clause 12 (a "RECOVERY"), then
(subject, as between any Secured Parties, to any agreement between such
Secured Parties):
(a) the recovering Finance Party (the "RECOVERING FINANCE PARTY")
shall, within 3 Business Days, notify details of the recovery to
the Security Trustee;
(b) the Security Trustee shall determine whether the recovery is in
excess of the amount which the recovering Finance Party would
have received under the Security Document had the recovery been
received by the Security Trustee and distributed in accordance
with Clause 12.15;
(c) the recovering Finance Party shall within 3 Business Days of
demand by the Security Trustee pay to the Security Trustee an
amount (the "redistribution") equal to the excess;
(d) the Security Trustee shall treat any such redistribution paid to
the Security Trustee as if it were a payment by the Obligors
under the Security Document and the Security Trustee shall pay
the redistribution to the relevant Finance Parties (other than
the recovering Finance Party) in accordance with Clause 12.15;
and
(e) after payment of the full redistribution, the recovering Finance
Party shall be subrogated to the portion of the claims paid
under clause (d) and the relevant Obligor shall owe the
recovering Finance Party a debt which is equal to the
redistribution, immediately payable and of the type originally
discharged.
11.2 REVERSAL OF REDISTRIBUTION
If:
(a) a recovering Finance Party is subsequently obliged to repay and
has repaid all or any part of a recovery, or an amount measured
by reference to a recovery, to any Obligor; and
(b) the recovering Finance Party has paid a redistribution under
Clause 11.1 in relation to that recovery,
each Finance Party which has received any part of that redistribution
shall, within three Business Days of demand by the recovering Finance
Party through the Security Trustee, reimburse the recovering Finance
Party all or the appropriate portion of the redistribution paid to that
Finance Party. Thereupon, the subrogation in Clause 11.1(e) shall
operate in reverse to the extent of the reimbursement.
11.3 EXCEPTION
A recovering Finance Party need not pay a redistribution to the extent
that it would not, after the payment, have a valid claim against the
relevant Obligor in the amount of the redistribution pursuant to Clause
11.1.
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12. SECURITY AND SECURITY TRUSTEE PROVISIONS
12.1 FORM AND BENEFICIARIES OF SECURITY
Each of the Finance Parties undertakes to ensure that any and all
security or liens now or hereafter held or obtained from any person for
or in respect of any Liabilities due, owing or incurred to it shall be
constituted by the Security Agreements and, together with each other
Operative Document to which the Security Trustee is a party (each,
together with the Security Agreements to which the Security Trustee is a
party and any other Instrument creating any lien in favour of or
creating any rights in favour of the Security Trustee), a "SECURITY
DOCUMENT") shall be held by the Security Trustee for the joint benefit
of all the Finance Parties in accordance with their respective priority
entitlements set out in this Agreement and the other Finance Documents.
12.2 PRIORITY OF SECURITY
(a) Each of the parties to this Agreement agrees that,
notwithstanding:
(i) any other term of this Agreement or any other Finance
Document; or
(ii) the date on which any thing is or was done or was
omitted to be done under or in relation to any or all of
the Finance Documents; or
(iii) any rule of Applicable Law or equity, or
(iv) the respective dates of execution and (where applicable)
registration of each of the Finance Documents; or
(v) that any Finance Party may have had notice of any of the
security interests constituted by any of the Finance
Documents at the time of the granting of any security by
any Obligor or any other party in favour of that Finance
Party; or
(vi) any other matter whatsoever,
but subject to any agreement between any of the Secured Parties,
the security constituted by each of the Security Agreements in
favour of that Finance Party shall rank equally so that all
repayments of the Liabilities of each Finance Party from the
proceeds of enforcement of any such Security Document shall,
after receipt by the Security Trustee, be applied in accordance
with the provisions of Clause 12.15.
(b) Each of the Finance Parties shall, to the extent necessary to
give effect to the provisions of this Clause account to each
other (through the Security Trustee) for any proceeds of
enforcement of the security constituted by the Security
Agreements to the extent they receive the same.
12.3 MODIFICATION OF SECURITY DOCUMENTS
Subject to Clause 15.1:
(a) the Security Trustee may and is hereby authorised by the other
Finance Parties at any time and from time to time, acting on the
directions of the Required Secured Parties to agree with any of
the Obligors any amendment, waiver, variation, modification or
consent to the Security Documents; and
(b) any amendment, waiver, variation, modification or consent
referred to in clause (a) may be made on such terms and subject
to such conditions (if any) as the Security Trustee and any of
the counterparties thereto may agree and shall be binding on all
Finance Parties;
(c) each such amendment, waiver, variation, modification or consent
shall be notified to the Finance Parties as soon as practicable
thereafter; and
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(d) for the purpose of clause (a), a certificate signed or
countersigned by the Security Trustee, specifying it has been
authorised by the requisite majority of Secured Parties shall be
final and binding on all parties.
12.4 DECLARATION OF TRUST
(a) The Security Trustee hereby confirms that it will hold the
Security Trust Property on trust for itself and the other
Finance Parties and each of the other Finance Parties agree that
the Security Trustee shall be entitled to exercise all the
rights, powers, discretions and benefits conferred on the
Security Trustee by this Agreement and the Security Documents in
accordance with the provisions thereof.
(b) If for any reason it is not possible or practical for any lien
to be created over any property or asset in favour of the
Security Trustee or any other person who is a party to this
Agreement as set out herein, the party requiring or receiving
the benefit of such lien shall procure that any alternative
security holder shall, as a condition precedent to its accepting
any such lien, accept obligations mutatis mutandis identical in
all material respects to those assumed by the Security Trustee
and shall only enforce such lien in accordance with the
instructions of the Required Secured Parties.
12.5 ENTERING INTO THE SECURITY DOCUMENTS
Forthwith upon and from time to time following the execution of this
Agreement, the Security Trustee is authorised to and shall execute the
Security Documents, provided they are in a form to which the Security
Trustee has no objection. Each other Finance Party hereby confirms that
all such Security Documents are approved by it.
12.6 ADDITIONAL SECURITY DOCUMENTS
(a) Any additional Instrument to be entered into in order
effectively to create or confirm security or rights for the
benefit of any of the Finance Parties shall be entered into
solely by the Security Trustee (or its nominee) and the Security
Trustee is hereby authorised to enter into such documents.
(b) The Security Trustee shall promptly following execution of any
additional Security Documents as contemplated under clause (a)
above, supply a copy to each of the other Finance Parties.
(c) The Security Trustee shall have no liability to the other
Finance Parties regarding the validity, enforceability or effect
of any such Security Documents.
12.7 SAFE CUSTODY
The Security Trustee is hereby authorised to and shall (subject to
Clause 12.33) hold in safe custody all deeds and documents which may be
deposited with the Security Trustee pursuant to the Finance Documents
and, if thought fit by the Security Trustee, to arrange for any stocks,
shares or other securities to be registered in the name of the Security
Trustee or its nominee (but without being liable to the Finance Parties
if such deeds and documents are not required to be deposited, or if such
securities are not so registered).
12.8 EXERCISE OF POWERS
(a) The Security Trustee is authorised:
(i) to exercise all powers granted to it under the Security
Documents, subject to and in accordance with the terms
of this Agreement and the Security Documents;
(ii) to discharge any security created by the Security
Documents on such terms as it thinks fit, subject to
obtaining directions from the Required Secured Parties
in accordance with this Agreement; and
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(iii) to do all other things which are incidental to the
rights, powers, discretions, duties, obligations and
responsibilities given or imposed upon the Security
Trustee by this Agreement and the Security Documents.
(b) The powers conferred upon the Security Trustee by this Agreement
shall be in addition to any powers which may from time to time
be vested in the Security Trustee by the general law and to any
powers conferred by the Trustee ▇▇▇ ▇▇▇▇.
(c) The Security Trustee shall not be under any obligation or duty
to take any action in relation to the Security Trust Property
unless and until directed to do so by the Required Secured
Parties in accordance with Clause 8 or Clause 12.9. The Security
Trustee shall at any time be entitled to request directions in
accordance with Clause 8 or Clause 12.9(a) from the Required
Secured Parties as to the manner in which it should exercise any
right, power, authority or discretion and may refrain from
acting until such directions have been received.
12.9 DIRECTIONS TO THE SECURITY TRUSTEE
(a) The Required Secured Parties may (including if requested by the
Security Trustee pursuant to Clause 12.8(c)) at any time and
from time to time give directions (in the manner specified in
clause (b)) to the Security Trustee in relation to the exercise
or non-exercise by the Security Trustee of the trusts, rights,
powers, duties, authorities or discretions conferred on the
Security Trustee pursuant to the Security Documents and under
this Agreement.
(b) The directions of the Required Secured Parties to the Security
Trustee in relation to the Security Documents shall only be
effective if they are given in writing and are signed or
countersigned (as the case may be) by authorised signatories of
the Required Secured Parties.
(c) The Security Trustee shall not (except as otherwise expressly
provided in this Agreement or any of the Security Documents) be
obliged or required to act in accordance with the directions of
any Finance Party given otherwise than in accordance with clause
(b) above or Clause 8 and the Security Trustee shall be entitled
to assume that the interests of each Secured Party are for all
purposes in connection with the Security Documents represented
by any such directions.
(d) The Security Trustee shall be obliged to act (subject as
otherwise herein provided) in accordance with any directions
given in accordance with clause (b).
(e) The Security Trustee shall seek the directions of the Secured
Parties in the manner provided in Clause 8, clause (b) or (if it
so elects or is directed by any Secured Party) in Clause 12.8
whenever the directions, instructions or consent of the Security
Trustee or any other Finance Party is required pursuant to any
provision of any of the Security Documents or this Agreement.
(f) Nothing in this Clause shall impair the right of the Security
Trustee, in its discretion, to take any action deemed proper by
the Security Trustee and which is not inconsistent with any
instruction given in accordance with clause (b) above and which
it is entitled to take pursuant to this Agreement or any Finance
Document.
(g) In the exercise of any right or power and as to any matter not
expressly provided for in the Finance Documents, the Security
Trustee may act or refrain from acting, in connection with this
Agreement or any Security Document, in accordance with the
instructions duly given under this Agreement and shall have no
liability in so doing. In any such case, in the absence of such
instructions, the Security Trustee may act or refrain from
acting as it shall see fit. Any such instructions shall be
binding on all Finance Parties. Without limiting the foregoing,
no Finance Party shall have any right of action or claim of any
kind whatsoever against the Security Trustee as a result of the
Security Trustee acting or refraining from acting hereunder or
under any Security Document in accordance with the instructions
of the relevant Finance Parties, as specified in this Agreement
or in the Security Document.
(h) The Security Trustee shall:
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(i) have no liability; and
(ii) shall be fully protected,
if it acts in accordance with instructions from the relevant
persons referred to in clause (g) above (as the case may be)
when acting or refraining from acting under the Security
Documents.
12.10 INFORMATION
(a) Each Finance Party shall, and is hereby authorised and directed
by each Obligor to, provide to the Security Trustee on request
such information as the Security Trustee may reasonably require
to enable the Security Trustee to perform its rights, powers,
duties, functions, authorities and discretions under the
Security Documents and hereunder.
(b) The Security Trustee shall, and is hereby authorised and
directed by each Obligor to, provide to (at the expense of such
Obligor where reasonably incurred) each Finance Party, upon
request, copies of all such documents and other written
materials in the possession of the Security Trustee regarding
such Obligor in relation to the Security Documents as may
reasonably be requested by any such Finance Party.
12.11 LIMITS OF TRUST
(a) It is expressly declared that the Security Trustee is trustee
under this Agreement and the Finance Documents to which it is a
party in its capacity as trustee only for the Finance Parties
and not for the Obligors or any other party whatsoever.
(b) The rights and benefits hereby conferred on the Security Trustee
and the other Finance Parties are in addition to those conferred
under any of the other Finance Documents.
(c) Each of the parties to this Agreement agrees and acknowledges
that, in the event of conflict between the rights, duties,
powers, discretions, liabilities and obligations of the Security
Trustee under this Agreement and those of the Security Trustee
under any other Security Documents, the former shall prevail.
(d) The Security Trustee shall have no duties or responsibilities
except those expressly set forth in this Agreement.
(e) Neither the Security Trustee in its personal capacity nor any of
its officers, directors, agents, or employees shall be liable
for any action taken or omitted by it or them hereunder or under
any other Security Document or in connection herewith or
therewith, unless caused by its or their gross negligence or
wilful misconduct.
(f) Nothing in this Agreement or any Security Document, expressed or
implied, is intended to or shall be so construed as to impose
upon the Security Trustee any obligations in respect of this
Agreement or any other Document except as expressly set forth
herein.
12.12 TIMING OF ENFORCEMENT
(a) No Secured Party shall instruct the Security Trustee to enforce
any of the security or rights constituted by the Security
Documents unless and until the Security Trustee shall have been
directed to do so by the Required Secured Parties in accordance
with this Agreement.
(b) The Security Trustee shall refrain from enforcing the security
and rights conferred by the Security Documents, unless and until
it has been directed to do so in accordance with clause (a).
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(c) Upon receipt of instructions in accordance with clause (b), the
Security Trustee shall enforce the rights and powers the
Security Trustee may have under all or any of the Security
Documents subject to and in accordance with this Agreement.
12.13 MANNER OF ENFORCEMENT
If the Security Trustee is instructed to enforce the security or rights
conferred by any of the Security Documents, it may do so in such manner
as it sees fit and solely having regard to the interests of the Finance
Parties as a whole and, subject to the instructions of the Required
Secured Parties, without having regard to the interests of any
individual Finance Party or group of Finance Parties.
12.14 PAYMENTS TO SECURITY TRUSTEE
The proceeds of:
(a) enforcement of any of the security or rights conferred by any of
the Security Documents;
(b) any distribution among creditors generally of the assets of any
Obligor by virtue of any process of law;
(c) any payment received by the Security Trustee under any Finance
Document;
(d) any amounts received by any Finance Party in respect of any
Liabilities after the taking of any enforcement action pursuant
to any Finance Document or after the date upon which the
Security Trustee has been instructed to enforce the security or
rights constituted by all or any of the Security Documents in
accordance with this Agreement whether by payment, distribution,
combination of accounts, set off, enforcement or otherwise; or
(e) any amount required to be paid to the Security Trustee pursuant
to the terms of any Finance Document,
shall be paid forthwith upon receipt by any Finance Party to the
Security Trustee for application in accordance with Clause 12.15.
12.15 ORDER OF APPLICATION
The Security Trustee shall forthwith apply any sums received pursuant to
Clause 12.14 (together with such other amounts as it may receive in its
capacity as Security Trustee) in the following order:
(a) FIRST, in or towards payment or reimbursement, pro rata, of the
Representatives Liabilities and any other costs, charges,
expenses and liabilities incurred by or on behalf of the
Security Trustee or the Facility Agent (and any Receiver,
attorney or agent appointed pursuant to any Security Document),
and remuneration of the Security Trustee or the Facility Agent
and every Receiver under the Security Documents;
(b) SECONDLY, in or towards meeting pro rata the costs of any
indemnity provided by any Finance Party to the Security Trustee
or the Facility Agent (or any Receiver, attorney or agent
appointed pursuant to any Security Document), in respect of the
enforcement of security or other rights conferred by the
Security Documents;
(c) THIRDLY, in or towards meeting pro rata the costs, expenses and
all other sums (other than principal and interest) due and
payable but unpaid to the Lenders, any Royalty Holder or the
Facility Agent under the provisions of any Finance Document;
(d) FOURTHLY, in or towards paying pro rata all other payment
Obligations of the Obligors to the Lenders, the Royalty Holders
or the Facility Agent due and payable but unpaid to them
hereunder or under any other Finance Document;
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(e) FIFTHLY, in or towards paying pro rata the amount due to each
Lender who is a Hedge Counterparty under any Price Protection
Agreement,
and the surplus (if any) after the unconditional and irrevocable payment
of all the above amounts in full shall be paid to or to the order of the
relevant Obligor or other person (or persons) for the time being legally
entitled thereto.
12.16 CERTIFICATES OF AMOUNTS PAYABLE
In determining the amount of any payment to be made to any person
pursuant to this Clause 12, the Security Trustee shall be entitled to
call for a certificate from each person entitled to receive any amount
as set out in Clause 12.15, to be dated a date specified by the Security
Trustee (not being earlier than 21 days prior to the proposed date of
payment), as to:
(a) whether the obligations have been paid or discharged in full;
(b) the amount due to the relevant person and the identity of that
person, and details thereof;
(c) the currency or currencies in which it is due;
(d) the nature of any amount due and the date or dates on which it
is payable or repayable; and
(e) such other matters as the Security Trustee may deem necessary or
desirable to enable it to make a distribution as at such date as
the Security Trustee may specify.
Each Finance Party agrees to provide the Security Trustee any such
information which may be requested by the Security Trustee. The Security
Trustee may treat each other Finance Party as a Finance Party until it
has received not less than three Business Days notice from such Finance
Party to the contrary.
12.17 PROPORTIONATE SHARES
To the extent that any sum falling payable to more than one person in
accordance with Clause 12.15 is greater than the amount available to be
applied in order to pay such sum, and such persons have an equal ranking
claim to such sum, the Security Trustee shall distribute the amounts so
available between the persons so entitled so as to ensure that the sums
owing to such persons are reduced by an equal proportion.
12.18 CALCULATION OF PRO RATA SHARES
For the purposes of Clause 12.17, the calculation of any amounts of
Liabilities outstanding under any Finance Document which are denominated
in a currency other than Dollars shall be effected by notionally
converting such currency into its equivalent in Dollars, on the basis
specified in Clause 12.20.
12.19 SUSPENSE ACCOUNTS
Unless instructed by the Required Secured Parties to the contrary, the
Security Trustee may, in its absolute discretion, and shall, if
instructed by the Required Secured Parties, place any sum received by it
in a suspense account for so long as, in its absolute discretion, it
shall think fit.
12.20 PAYMENTS TO FINANCE PARTIES
(a) Payments of, or on account of, Liabilities shall be made by the
Security Trustee to the person entitled to receive such amount
and to such account as such person may notify to the Security
Trustee. An acknowledgement of receipt signed by such person
shall be a good discharge of such obligation by the Security
Trustee.
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(b) Any payment or transfer or conversion required to be made by the
Security Trustee pursuant to this Agreement shall only be made
subject to any Applicable Laws.
12.21 PERFORMANCE OF DUTIES
The Security Trustee may:
(a) perform any of its duties, obligations and responsibilities
under the Security Documents through agents and the Security
Trustee shall not be responsible for any misconduct of such
agent or be bound to supervise the proceedings or conduct of
such agent;
(b) refrain from exercising any right, power or discretion vested in
it under the Finance Documents until it has received
instructions from the Required Secured Parties acting in
accordance with this Agreement and the Finance Documents and,
save in the case of negligence or wilful misconduct shall,
subject to the provisions of this Agreement, be fully protected
in so doing;
(c) refrain from doing anything which is or may be unlawful;
(d) refrain from taking any steps to protect or enforce the rights
of any Finance Party under the Security Documents until it has
been indemnified and/or secured to its satisfaction by the
Finance Parties against any and all claims which it would or
might sustain or incur as a result;
(e) rely on any communication or document believed by it in good
faith to be genuine;
(f) rely on the statements of any Obligor as to any matter or fact
which might reasonably be expected to be within the knowledge of
all or any of them;
(g) obtain and pay for such legal or other expert advice or services
as may to it seem reasonably necessary or desirable, and rely on
any such advice;
(h) retain for its own benefit any fee or other sum receivable by it
in connection with the Finance Documents but only to the extent
such fee or other sum is payable to it in its capacity as
Security Trustee;
(i) refrain from taking possession of any part of the Security Trust
Property or taking any other action in relation thereto if it
has cause to believe that the same may expose it to any
liability under any Environment Law or otherwise in respect of
which it is not fully insured or indemnified to its
satisfaction; and
(j) release any property or assets the subject of any lien created
in its favour to the extent the same may impose on it any
obligation or liability against which it is not fully insured or
otherwise expressly indemnified or secured to its satisfaction.
12.22 RESPONSIBILITY
Save as provided in Clause 12.11(e), neither the Security Trustee nor
any of its respective officers, employees or agents shall be responsible
or liable under this Agreement or any other Finance Document to any
other Finance Party, any Obligors or any other person whatsoever, it
being acknowledged by the other Finance Parties that the Security
Trustee has not made any independent investigation in relation thereto:
(a) for the adequacy, accuracy or completeness of any
representation, warranty, statement or information in any of the
Finance Documents or in any notice or other document delivered
thereunder;
(b) for the execution, delivery, validity, legality, adequacy,
enforceability or admissibility in evidence of any of the
Operative Documents or any obligations or rights created or
purported to be created thereby;
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(c) for the collectability of amounts payable under the Finance
Documents;
(d) for the validity, effectiveness, legality, adequacy or
enforceability of any security created or purported to be
created by any Security Documents or for any want of due
formality in the constitution of such security;
(e) for the title of any Obligor to any property or assets comprised
or purported to be comprised in any security created or
purported to be created by any Security Documents;
(f) for the ability of the Security Trustee to exercise any of the
rights or functions envisaged by this Agreement or any Security
Documents or for any loss or damage thereby occasioned; or
(g) for anything done or not done by it or any of them under or in
connection with the Finance Documents.
12.23 EXCLUSION OF DUTIES
The Security Trustee and each Finance Party enforcing its rights under
any of the Security Documents in accordance with this Agreement shall
have only those duties and responsibilities set out herein or imposed by
force of Applicable Law which are incapable of being excluded from its
relationship with the Finance Parties (whether as trustee or otherwise),
and each Finance Party hereby agrees that to the fullest extent
permitted by Applicable Law all duties and responsibilities owed by the
Security Trustee or such Finance Party to any other Finance Party in
consequence of such relationship shall be excluded, other than
obligations expressly set forth in this Agreement and the obligation
(subject thereto) generally to act bona fide in the interests of the
Finance Parties.
12.24 RELIANCE
Each Finance Party confirms that it has itself been and will at all
times continue to be solely responsible for making its own independent
investigation and appraisal of the business, financial condition,
creditworthiness, status and affairs of the Obligors and has not relied,
and will not at any time rely, on the Security Trustee and/or any other
Finance Party:
(a) to provide it with any information relating to the business,
financial condition, creditworthiness, status or affairs of the
Obligors whenever the same shall come into its possession; or
(b) to check or enquire into the adequacy, accuracy or completeness
of any information provided by the Obligors under or in
connection with the Finance Documents; or
(c) to assess or keep under review the business, financial
condition, creditworthiness, status or affairs of the Obligors.
12.25 MONITORING
The Security Trustee shall not be required to ascertain or inquire as to
the performance or observance by any Obligor of the terms of any Finance
Document or any other document in connection therewith. The Security
Trustee shall not be deemed to have knowledge of the occurrence of any
matter other than matters advised to it in writing by a Finance Party
and it shall (subject to such written advice) be entitled to assume
without enquiry that each Obligor is duly performing and observing all
the provisions of each Finance Document and that all agreements,
warranties, covenants and undertakings contained therein are being
complied with and that no event or circumstance which might cause
crystallisation of any floating charge has occurred or exists. On
receipt of such written advice the Security Trustee shall notify the
other Finance Parties of such advice.
12.26 OPINIONS AND CERTIFICATES
The Security Trustee may in relation to any of the Security Documents
act on the opinion or advice of, or a certificate or any information
obtained from, any lawyer, valuer, surveyor, securities company,
accountant or other expert in the United Kingdom, Ghana or elsewhere (in
any case acting in this
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capacity as such) whether obtained by any Finance Party, any receiver or
any Representative and shall not be responsible for any loss, liability,
costs, damages, expenses or inconvenience that may be occasioned by its
so doing and any such opinion, advice, certificate or information may be
sent or obtained by letter, telex, facsimile or in any other form of
visible reproduction and the Security Trustee shall not be liable for
acting on any opinion, advice, certificate or information purporting to
be so conveyed although the same shall contain some error or shall not
be authentic provided that such error or lack of authenticity is not
manifest.
12.27 TITLE DOCUMENTS
The Security Trustee shall be at liberty to place any Security Documents
and all deeds and other documents relating thereto or any of the
documents relating to, or constituting title to, any property which is
the subject matter of any security expressed to be created by or
pursuant to any Security Documents in any safe or other receptacle
selected by the Security Trustee, in England or (if, in the reasonable
opinion of the Security Trustee, necessary) Ghana or with any bank or
banking company, or lawyer or firm of lawyers believed by it to be of
good repute, in England or Ghana (as the case may be).
12.28 PERFECTION OF SECURITY
The Security Trustee shall not be bound to give notice to any person of
the execution of the Security Documents or the creation of any of the
security thereby constituted nor shall it be liable for any failure,
omission or defect in perfecting the security constituted by the
Security Documents or the priority of the security thereby constituted
including without prejudice to the generality of the foregoing:
(a) failure to obtain any licence, consent or other authority for
the execution, delivery, validity, legality, adequacy,
performance, enforceability or admissibility in evidence of the
same;
(b) failure to register the same in accordance with the provisions
of any of the documents of title of any Obligor;
(c) failure to effect or procure registration of or otherwise
protect any security created or purported to be created by or
pursuant to the Security Documents by registering, under the
Companies ▇▇▇ ▇▇▇▇ or any other Applicable Laws in any
territory, any notice, caution or other entry prescribed by or
pursuant to the provisions of the said Act or laws;
(d) failure to take or to require any Obligor to take any steps to
render any security securing the Obligations effective as
regards assets outside Ghana or to secure the creation of any
ancillary charge under the laws of any territory concerned; or
(e) failure to call for delivery of documents of title to or require
transfers, legal mortgages, charges or other further assurances
in relation to any of the assets the subject matter of any of
the Security Documents or any other document.
12.29 INSURANCES
The Security Trustee shall not be required to verify whether any Obligor
has arranged the insurances required to be effected or maintained by it
or any other person under any Operative Document or that any such
insurances comply with the requirements thereof or to investigate the
validity, adequacy, enforceability, admissibility in evidence or
effectiveness of any such insurances or to satisfy itself that the same
remain in full force and effect or have been renewed or that any
applicable premiums have been paid or to take any advice in relation
thereto or to ascertain whether any notices required to be given to, or
acknowledgements obtained from, any underwriters, insurers, re-insurers
or brokers have been given to, or, as the case may be, obtained from,
such underwriters, insurers, re-insurers or brokers nor shall the
Security Trustee be under any duty to or to require any person to insure
any of the Secured Trust Property for or against any loss, claim,
liability or expense which may be suffered or incurred by the Finance
Parties or any other person in respect thereof or the business or
activities of any Obligor.
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12.30 INSTRUCTIONS
The Security Trustee shall not be liable for acting on any opinion,
advice, certificate, information, writing, notice, instruction, telex,
cable, facsimile transmission or other document purporting to have been
signed, sent or made by the proper person or persons and reasonably
believed by it to be genuine although the same shall contain some error
or shall not be authentic or validly signed.
12.31 OBLIGOR CERTIFICATES
The Security Trustee may call for and shall be at liberty to accept a
certificate signed by any one director or other officer of any person as
to any fact or matter prima facie within the knowledge of that person as
sufficient evidence thereof, and a like certificate to the effect that
any particular dealing or transaction or step or thing is in the opinion
of the person so certifying expedient as sufficient evidence that it is
expedient and the Security Trustee shall not be bound in any such case
to call for further evidence or be responsible for any loss, liability,
costs, damages, expenses or inconveniences that may be occasioned by its
failing so to do.
12.32 REQUIRED SECURED PARTIES CERTIFICATES
The Security Trustee shall be entitled to call for and to rely upon a
certificate and shall be entitled to rely upon any directions or
instruction of the Required Secured Parties, reasonably believed by it
to be genuine, in respect of every matter and circumstance for which a
certificate, directions or instructions of the Required Secured Parties
is expressly provided for under this agreement or any of the Security
Documents, and to call for and to rely upon a certificate of the
Required Secured Parties as to whether any consent, agreement, approval,
direction, notice, designation or requirement has been given or made, or
other similar action taken or thing done, or as to any other fact or
matter prima facie within the knowledge of any Finance Party, as
sufficient evidence thereof and the Security Trustee shall not be bound
in any such case to call for further evidence or be responsible for any
loss, liability, costs, damages, expenses or inconvenience that may be
occasioned by its failing so to do.
12.33 POSSESSION OF TITLE DOCUMENTS
The Security Trustee shall not be under any obligation, unless and until
requested in writing to do so by the Required Secured Parties and
notwithstanding any obligation imposed on any Obligor in any of the
Security Documents to deliver the same to the Security Trustee (but
without prejudice to any such obligation of any Obligor), to require any
Obligor or any other person to deliver to, or to the order of, the
Security Trustee, or to take possession of, any deeds or other documents
relating to, or constituting title to, any property or assets of any
Obligor or any policies of insurance effected by any Obligor or any
other person, whether pursuant to the terms of any of the Security
Documents or otherwise, and the Security Trustee shall not be liable or
responsible for any loss or damage incurred as a result of permitting
such deeds or other documents to remain in the possession or control of
any Obligor or to be held by any other person on behalf, or to the
order, of any Obligor nor shall the Security Trustee be liable or
responsible for any loss or damage arising as a result of any such deeds
or other documents being held by any person on behalf of or to the order
of the Security Trustee if the Required Secured Parties has authorised
or directed the Security Trustee to permit such person to hold the same
or have custody thereof.
12.34 FINANCE PARTY ADVICE
The Security Trustee may (and it is the intention that it shall) assume
that each of the other Finance Parties has taken and obtained such legal
and other advice and opinions in Ghana and all other relevant
jurisdictions as it thinks necessary or desirable in relation to any
Obligor or any other person, this Agreement, each of the other Security
Documents, each of the Project Documents, or any other
document, the transactions hereby and thereby contemplated, the Security
Trust Property and the business and activities of any Obligor and any
other person, and that the same is satisfactory to it and the Security
Trustee shall be entitled to rely upon any such advice or opinion
addressed or made available to it and shall have no obligation or
responsibility to seek or obtain any independent or additional advice or
opinion whether in Ghana or elsewhere and shall not be liable for any
loss or damage suffered or incurred by the Finance Parties or any of
them or any other person as a result thereof.
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12.35 TAX
The Security Trustee shall have no responsibility whatsoever to any
Obligor or any other Finance Party as regards any deficiency which might
arise because the Security Trustee is subject to any tax in respect of
the Security Trust Property or any part thereof or any income therefrom
or any proceeds thereof or required to withhold any tax from any sums
distributed by it or by reason of any person being for any purpose
domiciled or resident in, or otherwise connected with, or subject to the
jurisdiction of, any particular territory.
12.36 EXPENDITURE OF OWN FUNDS
No provision of any Security Documents shall require the Security
Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties, or in the exercise of
any of its rights or powers, and no provision of this Agreement or any
other Security Document shall require the Security Trustee to take any
action or refrain from taking any action in the performance of its
duties, or in the exercise of any of its rights or powers, until it
shall have received such indemnity, or indemnities or security
(including payment in advance) as, in its absolute discretion, it may
require against all costs, claims, expenses and liabilities which it may
expend or incur in so doing.
12.37 DELEGATION
The Security Trustee may, in the execution and exercise of all or any of
the trusts, powers, authorities and discretions vested in it by this
Agreement or any of the Security Documents, act by responsible officers
or a responsible officer for the time being of the Security Trustee and
the Security Trustee may also, whenever it thinks expedient in the
interests of the Finance Parties, whether by power of attorney or
otherwise, delegate to any person or persons or fluctuating body of
persons all or any of the trusts, rights, powers, duties, authorities
and discretions vested in it by this Agreement or any of the Security
Documents and any such delegation may be made upon such terms and
conditions and subject to such regulations (including power to
sub-delegate) as the Security Trustee may think fit in the interests of
the Finance Parties (and provided that the Security Trustee shall have
exercised reasonable care in the selection of such delegate and has
obtained consent of the Required Secured Parties, not to be unreasonably
withheld) it shall not be bound to supervise the proceedings of and
shall not in any way or to any extent be liable or responsible for any
loss or damage arising from any act, default, omission or misconduct on
the part of any such delegate or sub-delegate.
12.38 DISCLOSURE OF INFORMATION
The Security Trustee need not disclose any information relating to any
Obligor, or any related or associated entities, received otherwise than
in its capacity as Security Trustee hereunder if such disclosure would
or might, in the opinion of the Security Trustee, constitute a breach of
any law or any duty of secrecy or confidence.
12.39 BORROWER INDEMNITY
(a) In the event of the Security Trustee being required to undertake
any exceptional duties in the course of its trusteeship under
any of the Security Documents (which shall, without limitation,
be presumed once the Security Trustee shall have become bound to
enforce any of the security constituted by the Security
Documents or when in the opinion of the Security Trustee
circumstances exist in which such event may occur), the Borrower
shall pay such additional remuneration as shall be agreed
between the Security Trustee and the Borrower (or, after an
Event of Default has occurred and is continuing, the Required
Secured Parties). In the event of the Security Trustee and the
Borrower (or the Required Secured Parties, as the case may be)
failing to agree to an alteration in the annual remuneration or
the amount of any additional remuneration as aforesaid it shall
be determined by an investment bank selected by the Security
Trustee and approved by the Borrower (or the Required Secured
Parties, as the case may be) or, failing such approval, on the
application of the Security Trustee nominated by the President
for the time being of the Law Society of England and Wales, the
expenses involved in such nomination and the fees of such
investment bank being paid by the Borrower and the determination
of such investment bank (who shall be deemed to be acting as an
expert and not
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as an arbitrator) shall be conclusive and binding upon the
Security Trustee and the Borrower (or the Required Secured
Parties, as the case may be).
(b) The Borrower shall pay to the Security Trustee an amount equal
to the amount of any value added tax or similar tax chargeable
in respect of its remuneration hereunder.
(c) The Borrower shall indemnify the Security Trustee and keep it
indemnified:
(i) in respect of all liabilities sustained and costs and
expenses properly incurred by it or by any delegate or
sub-delegate appointed by the Security Trustee in the
proper execution or purported execution of the trusts,
powers, authorities or discretions vested in the
Security Trustee by, or the proper performance of
obligations assumed by the Security Trustee under, this
Agreement or any of the Security Documents; and
(ii) against all liabilities, actions, proceedings, costs and
expenses, claims and demands in respect of any matter or
thing done or omitted by it or such person in any way
relating to this Agreement or any of the Security
Documents or the security constituted thereby except to
the extent that they are sustained or incurred as a
result of the negligence, wilful misconduct or fraud of
the Security Trustee.
(d) All sums payable to the Security Trustee under paragraphs (a),
(b) and (c) of this clause and pursuant to Clauses 15.3 and 15.4
(herein after together with any interest referred to in this
paragraph (d) called "SECURITY TRUSTEE INDEMNIFIED LIABILITIES")
shall be payable on demand.
12.40 FINANCE PARTY INDEMNITY
(a) Each Secured Party agrees to severally indemnify the Security
Trustee for any Security Trustee Indemnified Liabilities (to the
extent not reimbursed by the Borrower and without prejudice to
the liability of the Obligors under any Finance Document), and
for all value added and other taxes paid or suffered by it in
connection therewith, or any liabilities, losses, damages,
penalties, actions, judgements, costs, expenses or disbursements
of any kind whatsoever which may be imposed on, incurred by or
asserted against the Security Trustee relating to or arising out
of (i) the Security Trustee acting as the Security Trustee under
the Security Documents or (whether itself or through any agent)
acting as the holder of any security taken by it or (ii) the
Security Trustee performing its duties thereunder or (iii) any
action taken or omitted by the Security Trustee thereunder.
(b) Such indemnification shall be made rateably in accordance with
the amount of Liabilities owing to each Secured Party and
outstanding under the Finance Documents as at the date of demand
hereunder.
(c) Notwithstanding the foregoing, no Lender shall be liable for any
portion of the foregoing resulting from the Security Trustee's
negligence or wilful misconduct.
12.41 TRUST INDEMNITY
The Security Trustee shall be entitled to be indemnified out of any
assets it receives or holds on trust from time to time hereunder or
under the Security Documents for any and all Security Trustee
Indemnified Liabilities and for all value added and other taxes paid or
suffered by it in connection therewith.
12.42 LIABILITY AND ILLEGALITY
The Security Trustee may refrain from doing anything which would or
might in its opinion (a) be contrary to any Applicable Law or (b) render
it liable to any person, and may do anything which in its opinion is
necessary to comply with any such Applicable Law.
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12.43 REGISTRATION OF SECURITY
Save as otherwise required under the Finance Documents, neither the
Security Trustee, nor any other Finance Party shall be liable for any
failure, omission, or defect in perfecting the security constituted by
any of the Security Agreements including, without limitation, any
failure to:
(a) register the same in accordance with the provisions of any of
the documents of title of the relevant chargor to any of the
property thereby charged;
(b) make any recordings or filings or rerecordings or refilings in
connection therewith;
(c) effect or procure registration of or otherwise protect any
security interest created or evidenced by any of the Security
Documents under the registration laws in any jurisdiction.
12.44 MONEY ON DEPOSIT
Save as otherwise provided in the Security Documents, all moneys
received by the Security Trustee under any of the Security Documents or
otherwise may, prior to their application in accordance with the terms
of this Agreement, be placed on deposit in the name of or under the
control of the Security Trustee at such bank or institution (including
the Security Trustee) and upon such terms as the Security Trustee may
think fit.
12.45 VOTING ENTITLEMENTS
Neither the Security Trustee nor any Finance Party shall be liable to
any person by reason of having acted upon any instructions purported to
have been given by or with the consent of the requisite voting majority
of Voting Entitlements required under this Agreement (in the case of the
Security Trustee) or the Security Trustee (in the case of any Finance
Party) even though subsequent to its acting it may be found that there
was some defect in the instructions so given or the votes so cast.
12.46 CONSENTS AND APPROVALS
Any consent or approval given by the Security Trustee for the purposes
of this Agreement may be given on such terms and subject to such
conditions (if any) as the Required Secured Parties shall direct and
notwithstanding anything to the contrary in this Agreement may be given
retrospectively.
12.47 TRUSTEE'S LIABILITY AT LAW
Nothing in this Agreement shall, in any case in which the Security
Trustee has failed to show the degree of care and diligence required of
it as trustee having regard to the provisions of this Agreement
conferring on it any trusts, powers, authorities or discretions, exempt
the Security Trustee from or indemnify it against any liability for
breach of trust or any liability which by virtue of any rule of law
would otherwise attach to it in respect of any negligence, default,
breach of duty or breach of trust of which it may be guilty in relation
to its duties under this Agreement.
12.48 RESIGNATION
The Security Trustee may, at any time and without giving any reason
therefor, resign by giving not less than 30 days' prior written notice
thereof to the Finance Parties and the Borrower, provided that the
resignation of the Security Trustee shall not become effective unless a
successor has succeeded to, and been fully vested with, all rights,
powers, privileges and duties of, the resigning Security Trustee in
accordance with Clause 12.50.
12.49 REMOVAL BY FINANCE PARTIES
The Required Secured Parties (calculated ignoring the votes of the
Security Trustee in its capacity as a Secured Party (if applicable)) may
dismiss the Security Trustee by giving it not less than 30 days' prior
written notice thereof, provided that the dismissal of the Security
Trustee shall not become effective
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unless a successor has succeeded to, and been fully vested with, all
rights, powers, privileges and duties of, the dismissed Security Trustee
in accordance with Clause 12.50.
12.50 APPOINTMENT OF SUCCESSOR
Upon the giving of a notice under Clause 12.48 or 12.49, the Required
Secured Parties (calculated ignoring the votes of the Security Trustee
in its capacity as a Lender (if applicable)) shall have the right
(subject to consultation with the Borrower, if practicable) to appoint a
successor Security Trustee. If no such successor Security Trustee shall
have been so appointed and shall have accepted such appointment within
thirty days after the giving of any such notice (or such shorter period
as may be required to ensure the successor Security Trustee complies
with any Applicable Law if pursuant to such Applicable Law it is
unlawful for the Security Trustee to continue acting as Security
Trustee), the retiring Security Trustee may appoint a successor Security
Trustee. Upon the acceptance of any appointment by a Security Trustee
under this Agreement of a successor Security Trustee, and upon due
execution of a Security Trustee Deed of Accession in the form set out in
Schedule 2, such successor Security Trustee shall thereupon succeed to
and become vested with all rights, powers, privileges and duties of the
retiring Security Trustee which shall be discharged from its duties and
obligations hereunder.
12.51 CONTINUING BENEFITS
After any Security Trustee's dismissal or resignation hereunder as
Security Trustee, the provisions of this Agreement will continue in
effect for its benefit in respect of any actions taken or omitted to be
taken by it while it was acting as Security Trustee.
12.52 REMUNERATION
The Borrower shall pay to the Security Trustee remuneration for its
services hereunder as from the date of this Agreement, such remuneration
to be at such rate as may from time to time be agreed between the
Borrower and the Security Trustee. Such remuneration shall be payable in
accordance with the terms of such agreement, shall accrue from day to
day and be payable in the priority specified in Clause 12.15.
12.53 TAX
The Borrower shall in addition pay to the Security Trustee an amount
equal to the amount of any sales, value added tax or similar tax
chargeable in respect of its remuneration under this Agreement.
12.54 DEFAULT
(a) The Security Trustee is not obliged to monitor or enquire as to
whether or not a Default has occurred. The Security Trustee
shall not be deemed to have knowledge of the occurrence of a
Default unless it receives written notice from a Finance Party
referring to the Security Document, describing the Default and
stating that the event is a Default. Upon receipt of such a
notice, it shall promptly notify the Finance Parties (in the
case of the Lenders via the Facility Agent).
(b) The Security Trustee may require the receipt from the Secured
Parties of security satisfactory to it, whether by way of
payment in advance, indemnity or otherwise, against any
liability or loss which it will or may incur in taking any
proceedings or action arising out of or in connection with any
Security Document before it commences those proceedings or takes
that action.
12.55 RELIANCE
The Security Trustee may:
(a) rely on, and be fully protected in relying on, any notice,
certificate, opinion, communication or document reasonably
believed by it to be genuine and correct, in conformity with the
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Operative Documents and to have been signed by, or with the
authority of, a proper person; and
(b) rely on, and be fully protected in relying on, any statement
made by a director or employee of any person regarding any
matters which may be assumed to be within his knowledge or
within his power to verify.
12.56 CREDIT APPROVAL AND APPRAISAL
Without affecting the responsibility, if any, of any Obligor for
information supplied by it or on its behalf in connection with any
Finance Document, each Finance Party represents and warrants that:
(a) in connection with its participation in each Finance Document,
it has made its own independent investigation and assessment of
the structure of the Project, the form and substance of all
Operative Documents and the financial condition, prospects,
creditworthiness, status and affairs of the Obligors and any
other person connected with the Project and has not relied on
any information provided to it by the Security Trustee or any
other Finance Party; and
(b) it shall continue to make its own independent appraisal of the
matters referred to in clause (a) while any amount is or may be
outstanding under the Finance Documents or any Commitment is in
force.
12.57 INFORMATION
The Security Trustee:
(a) subject to clause (b), shall promptly forward to the person
concerned the original or a copy of any document which is
delivered to the Security Trustee by a party for that person;
(b) without prejudice and subject to any duty of confidentiality,
shall promptly supply each Finance Party with a copy of each
document received by the Security Trustee under the Security
Documents upon the request of that Finance Party and at the
expense of the Borrower;
(c) shall not be obliged to review or check the accuracy or
completeness of any document it forwards to another Party; and
(d) except as provided above, does not have a duty:
(i) either initially or on a continuing basis to provide any
Finance Party with any information concerning any of the
matters referred to in Clause 12.58 whether coming into
its possession before, on or after the date of this
Agreement; or
(ii) unless specifically requested to do so by a Finance
Party in accordance with this Agreement or any other
Security Document, to request any certificates or other
documents from the Obligors.
12.58 THE SECURITY TRUSTEE AS BANKER
In acting as the Security Trustee, the Security Trustee shall be treated
as a separate entity from any other division of the Security Trustee (or
similar units of the Security Trustee in any subsequent reorganisation)
or its affiliates and, without limiting the generality of the foregoing,
in the event that any of the Security Trustee's divisions (or similar
units) or affiliates should act for any Group Member in an advisory
capacity in relation to any other matter, any information given by any
Group Member to such divisions (or similar units) or affiliates for the
purposes of obtaining advice shall be treated as confidential and shall
not be available to the other Finance Parties without the consent of the
Borrower; and notwithstanding anything to the contrary expressed or
implied herein and without limiting the generality of the foregoing, the
Security Trustee shall not as between itself and the other Finance
Parties be bound to disclose to any Finance Party or other person any
information supplied by any
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Group Member to the Security Trustee in its capacity as the Security
Trustee hereunder which is identified by such Group Member at the time
of supply as being unpublished price sensitive information relating to a
proposed transaction by a Group Member to the Security Trustee and
supplied solely for the purpose of evaluating in consultation with the
Security Trustee in its capacity as advisor whether such transaction
might require a waiver or amendment to any of the provisions contained
herein or in any other Finance Document.
12.59 COMPLIANCE
(a) The Security Trustee may refrain from doing anything which
might, in its opinion, constitute a breach of any Applicable Law
or regulation or be otherwise actionable at the suit of any
person, and may do anything which, in its opinion, is necessary
or desirable to comply with any Applicable Law of any
jurisdiction.
(b) Without limiting clause (a), the Security Trustee need not
disclose any information relating to any Obligor or any other
party to any Operative Document if the disclosure might, in the
opinion of the Security Trustee, constitute a breach of any
Applicable Law or any duty of secrecy or confidentiality or be
otherwise actionable at the suit of any person.
12.60 OTHER FINANCE DOCUMENTS
Each Finance Party irrevocably authorises the Security Trustee to
execute on its behalf on the date of this Agreement and/or from time to
time thereafter such of the Security Documents and/or consents, waivers
and/or determinations under or in respect of any Finance Document as are
expressed to be executed by the Security Trustee.
12.61 CONFLICT AS BETWEEN SECURED PARTIES
In taking any action, performing any duties and in exercising any
rights, powers and directions in accordance with the terms of this
Agreement or any other Security Document, the Security Trustee:
(a) will, subject to the terms of this Agreement, have regard to the
interests of each and every Secured Party;
(b) will be deemed to have complied with clause (a) and will not be
liable for a breach of clause (a) if it has acted in good faith
or has sought and acted upon the instructions of the Required
Secured Parties in taking such action, performing such duties
and in exercising any rights, powers and directions in
accordance with the terms of the Security Document; and
(c) shall not be liable (except in the case of gross negligence or
wilful default) to any Secured Party for any breach of clause
(a).
13. TRANSFERS
13.1 OBLIGORS
The rights, benefits, interests and obligations of each Obligor under
any Finance Document are personal to it and are not capable of
assignment without the prior written consent of all the Finance Parties.
13.2 FINANCE PARTIES
Each Finance Party agrees that it will not assign, transfer or novate
any of its rights, benefits, interests or obligations under any Finance
Document, none of which are capable of assignment, transfer or novation
except in order to comply with any Applicable Law or as expressly
permitted in accordance with the terms of this Agreement.
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13.3 TRANSFERS BY SECURED PARTY
(a) ROYALTY HOLDER
(i) Each Royalty Holder may assign and transfer its rights
under any Royalty Agreement to which it is a party
pursuant to the terms thereof. Each Royalty Holder from
time to time shall, upon becoming the Royalty Holder and
upon execution of a Royalty Holder Deed of Accession
substantially in the form of Schedule 4, have the
benefits of, be entitled to exercise the rights and
shall have the obligations of a Royalty Holder hereunder
and under each other Finance Document to which the
Royalty Holder is a party.
(ii) Upon the execution of a Royalty Holder Deed of Accession
by all parties thereto, the Retiring Royalty Holder (as
defined therein) shall be released from any further
obligations and liabilities under the Finance Documents
to any other parties to such Finance Documents.
(b) FACILITY AGENT AND LENDERS
The Facility Agent and each Lender shall be entitled to transfer
or assign its rights and obligations under each Finance Document
to which it is a party pursuant to Clause 18 respectively of the
Loan Agreement and, in the case of any new Facility Agent shall,
upon execution of a Facility Agent Deed of Accession
substantially in the form of Schedule 5, have the benefits of,
be entitled to exercise the rights and shall have the
obligations of the Facility Agent hereunder and under each other
Finance Document to which it is a party.
14. FEES AND LATE PAYMENTS
14.1 FEES
The Borrower shall pay to the Security Trustee, fees in the amounts and
at the times agreed between the Borrower and the Security Trustee, in
connection with the execution of this Agreement and the other Finance
Documents.
14.2 DOLLAR PAYMENTS
All fees payable under a Finance Document shall be payable in Dollars.
Each Obligor hereby acknowledges that any portion of any fee once paid
shall be non-refundable, such portion having already been earned by
performance.
14.3 LATE PAYMENTS
(a) If any Obligor fails to pay any amount payable by it to a
Finance Party under a Finance Document on its due date, interest
shall accrue on the overdue amount from the due date up to the
date of actual payment (both before and after judgment) at a
rate two per cent higher than the rate which would have been
payable if the overdue amount had, during the period of
non-payment, constituted a Loan in the currency of the overdue
amount for successive Interest Periods, each of a duration
selected by (in the case of amounts due to the Security Trustee)
the Security Trustee, (in the case of amounts due to a Lender or
the Facility Agent) the Facility Agent or (in the case of
amounts due to a Royalty Holder) each Royalty Holder (in each
case, acting reasonably). Any interest accruing under this
Clause 14.3 shall be immediately payable by the relevant Obligor
on demand by the person to whom such amount is payable or (in
the case of the Lenders) the Facility Agent.
(b) Default interest (if unpaid) arising on an overdue amount will
be compounded with the overdue amount at the end of each
Interest Period applicable to that overdue amount but will
remain immediately due and payable.
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15. MISCELLANEOUS
15.1 WAIVERS, AMENDMENTS, ETC.
The provisions of this Agreement and (other than a Royalty Agreement
which may only be amended in accordance with the terms thereof) of each
other Finance Document (except to the extent otherwise set forth in such
Finance Document) may from time to time be amended, modified or waived,
if such amendment, modification or waiver is in writing and consented to
by the Obligor (or Obligors) party thereto, the Security Trustee and the
Required Secured Parties, and, in the case of any Security Document, the
Security Trustee; provided, however, that no such amendment,
modification or waiver which would:
(a) modify any requirement hereunder that any particular action be
taken or a determination be made by, or with the consent of or
in consultation with, all the Secured Parties or the Required
Secured Parties shall be effective unless consented to by each
Secured Party;
(b) modify this Clause 15.1 or change the definition of "REQUIRED
SECURED PARTIES", shall be made without the consent of each
Secured Party;
(c) extend the due date for, or reduce the amount of, any payment or
prepayment of principal or of interest on any Loan or any other
amount payable hereunder shall be made without the consent of
each Secured Party;
(d) affect the interests, rights or obligations of either
Representative, the Facility Agent qua such Representative or
the Facility Agent shall be made without the consent of such
Representative or the Facility Agent (as the case may be);
(e) other than as specifically permitted by this Agreement or the
Security Documents, modify or authorise or effect the release of
any material portion of the collateral which is the subject of
any lien granted or purported to be granted in favour of the
Security Trustee or in favour of the Finance Parties pursuant to
any relevant Security Document shall be made:
(i) prior to an Event of Default and before the Discharge
Date, without the consent of each Secured Party;
(ii) after an Event of Default and before the Discharge Date,
without the consent of each Lender; and
(iii) after the Discharge Date, without the consent of the
Required Secured Parties;
(f) increase the Commitment of any Lender or otherwise subject any
Lender to any additional obligation without the consent of such
Lender;
(g) modify any term of this Agreement or any other Finance Document
expressly relating to the priority of payment of, or the
granting of any security in respect of, any obligations of the
Borrower under any Price Protection Agreement to which any
Secured Party is a party shall be made without the consent of
such Secured Party;
(h) materially reduce the obligations of the Sponsor under the
Support Agreement shall be made without the consent of each
Secured Party; or
(i) modify Clause 3 (or any defined term referred to therein),
Clauses 5.4, 6.3, 6.4, 7.2 or 12.15 without the consent of each
Secured Party;
provided that nothing in this Clause 15.1 shall prevent the Security
Trustee exercising its rights against any Obligor pursuant to any
Finance Document unless it is directed otherwise by the Required Secured
Parties.
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15.2 NOTICES
All notices and other communications provided to any party hereto under
this Agreement or any other Finance Document shall be in writing and
shall be sent by hand delivery, courier delivery, telex (if the
receiving party shall have telex facilities) or facsimile and addressed
or delivered to it at its address set forth below its signature hereto
and designated as its "ADDRESS FOR NOTICES" (or in any Deed of Accession
to which it is a party) or at such other address as may be designated by
such party in the Security Document or in a notice to the other parties.
Any notice:
(a) if sent by hand delivery or courier delivery, shall be deemed
received when delivered; and
(b) if transmitted by telex or facsimile, shall be deemed given when
transmitted (answerback received at both the beginning and end
of the relevant transmission in the case of telexes and
transmission confirmed by the sending facsimile machine in the
case of facsimiles).
15.3 COSTS AND EXPENSES
The Borrower agrees to:
(a) pay on demand all reasonable out-of-pocket expenses of each
Finance Party for the negotiation, preparation, execution and
delivery of this Agreement and each other Finance Document,
including Schedules, and any amendments, waivers, consents,
supplements or other modifications to this Agreement or any
other Finance Document or the Development Plan as may from time
to time hereafter be required whether or not the transactions
contemplated hereby are consummated, and all reasonable
out-of-pocket expenses (inclusive as aforesaid) of the
Representatives (including reasonable fees and expenses of legal
advisers to each Representative) on a full indemnity basis and
any stamp or other taxes incurred in connection with the
preparation and review of the form of any Instrument relevant to
this Agreement or any other Finance Document, the consideration
of legal questions relevant hereto and thereto and the filing,
recording, refiling or re-recording of any Finance Document and
all amendments or supplements to any thereof and any and all
other documents or Instruments of further assurance required to
be filed or recorded or refiled or re-recorded by the terms
hereof or of any other Finance Document;
(b) pay on demand all reasonable out-of-pocket expenses of each
Finance Party's officers or agents in connection with its annual
on-site inspections of the Mine and all fees and expenses of the
Independent Engineer for the preparation of the Technical
Review, each Annual Independent Engineer's Report (provided that
the Secured Parties shall not require the Independent Engineer
to provide an Annual Independent Engineer's Report after the
Discharge Date unless a Default shall have occurred and be
subsisting) and other reports required of it (whether or not
such documents are actually completed), the fees and expenses of
any Expert, the fees and expenses of the independent chartered
accountants and certified public accountants in connection with
the performance of their duties described in Clause 5.9, the
certification of each Compliance Certificate and any compliance
certificate provided under the Support Agreement, the Economic
Completion Certificate or any other matter relating to the
Project and the Mine, and all reasonable fees and expenses of
the Insurance Consultant and the Project Account Banks in
connection with the performance of their respective duties
referred to herein; and
(c) reimburse each Finance Party upon demand for all out-of-pocket
expenses (including fees and expenses of legal advisers to such
Finance Party on a full indemnity basis) incurred by such
Finance Party in connection with:
(i) the negotiation and completion of any restructuring or
"WORK-OUT", whether or not consummated whatever the
nature of such expenses are, of any Obligations; and
(ii) the enforcement of any Obligations.
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15.4 INDEMNIFICATION
The Obligors hereby jointly and severally indemnify, exonerate and hold
each Finance Party and each of its officers, directors, shareholders,
employees, advisers and agents (the "INDEMNIFIED PARTIES") free and
harmless from and against any and all actions, causes of action, suits,
losses, costs, liabilities and damages and expenses in connection
therewith (including reasonable fees and expenses of legal advisers on a
full indemnity basis and inclusive of United Kingdom or Ghanaian value
added tax or other similar tax payable in connection therewith and
including any amount paid by any Lender to either Representative (the
"INDEMNIFIED LIABILITIES"), incurred by the Indemnified Parties or any
of them as a result of, or arising out of, or relating to:
(a) in the case of the Borrower, any transaction financed or to be
financed in whole or in part, directly or indirectly, with the
proceeds of any Loan;
(b) in the case of the Borrower, the entering into and performance
of this Agreement and any other Finance Document by any of the
Indemnified Parties (including any action brought by or on
behalf of any Obligor as the result of any proper determination
by the Lenders pursuant to Clause 4 of the Loan Agreement not to
fund any Loan);
(c) in the case of each Obligor other than the Borrower, the
entering into and performance of this Agreement and any other
Finance Document to which such Obligor is a party by any of the
Indemnified Parties (including any action brought by or on
behalf of such Obligor as the result of any proper determination
by the Lenders pursuant to Clause 4 of the Loan Agreement not to
fund any Loan);
(d) any investigation, litigation or proceeding related to any
environmental clean-up, audit, compliance or other matter
relating to the protection of the environment or the release by
any Obligor of any Hazardous Material; or
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, or release or threatened release
from, any real property owned or operated by any Obligor of any
Hazardous Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising under
any Environmental Law), regardless of whether caused by, or
within the control of, such Obligor,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified
Party's negligence or wilful misconduct, and if and to the extent that
the foregoing undertaking may be unenforceable for any reason, each
Obligor hereby jointly and severally agrees to make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under Applicable Law and provided that
such Obligor's liability pursuant to clauses (d) and (e) above shall:
(i) exclude any liability incurred by any Lender solely in
its capacity as a lender (or agent of a lender) to
Satellite Goldfields Limited; and
(ii) be limited to the proceeds received by the Security
Trustee from any realisation of any lien pursuant to any
Security Agreement to which such Obligor is a party.
15.5 TAXES
(a) All payments by each Obligor of principal of, and interest on,
the Loans and all other amounts payable pursuant to this
Agreement or any other Finance Document to any Finance Party
shall be made free and clear of, and without deduction for any,
present or future income, excise, stamp or other taxes, fees,
duties, withholdings or other charges of any nature whatsoever
imposed by any taxing authority of any jurisdiction, in each
case other than franchise taxes and taxes imposed on or measured
by the recipient's net income or receipts (such non-excluded
items referred to as "TAXES") other than as required by
Applicable Law. In the event that any withholding or deduction
from any payment to be made by any Obligor hereunder or under
any other Finance Document is required in respect of any Taxes
pursuant to any Applicable Law, the relevant Obligor will:
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(i) to the extent that any such Taxes are payable by the
Obligor, pay directly to the relevant authority the full
amount to be so withheld or deducted;
(ii) promptly forward to the recipient of such payment an
official receipt or other documentation satisfactory to
the recipient of such payment (to the extent the same is
available to the Obligor) evidencing such payment to
such authority; and
(iii) pay to the recipient of such payment for the account of
the person or persons entitled thereto such additional
amount or amounts as is necessary to ensure that the net
amount actually received by such person will be equal to
the full amount such person would have received had no
such withholding or deduction been required.
(b) If any Taxes are directly asserted against any Finance Party
with respect to any payment received by such Finance Party
hereunder or under any other Finance Document, such Finance
Party may pay such Taxes and the Borrower will promptly pay such
additional amounts (including any penalties, interest or
expenses except to the extent that the same are incurred as a
result of the negligence or wilful misconduct of such Finance
Party) as is or are necessary in order that the net amount
received by such Finance Party after the payment of such Taxes
(including any Taxes on such additional amount) shall equal the
amount such Finance Party would have received had such Taxes not
been asserted.
(c) If an Obligor fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the recipient of such
payment, for its own account and/or, as the case may be, the
account of the relevant Finance Parties, the required receipts
or other required documentary evidence, the Borrower shall
indemnify the recipient of such payment or such Finance Parties,
as the case may be, for any incremental Taxes, interest or
penalties that may become payable by any such Finance Party as a
result of any such failure (excluding, however, any such
incremental Taxes, interest or penalties incurred as a result of
the negligence or wilful misconduct of such Finance Party). For
the purposes of this Clause, a distribution hereunder or under
any other Finance Document by a Representative, the Facility
Agent or any Lender to or for the account of any Lender or other
Finance Party shall be deemed a payment by an Obligor.
(d) The Finance Parties agree to cooperate with the relevant Obligor
in completing and delivering or filing tax-related forms which
would reduce or eliminate any amount of Taxes required to be
deducted or withheld on account of any payment made by the
Obligor under this Agreement or any other Finance Document;
provided, however, that no Finance Party shall be under any
obligation to execute and deliver any such form if, in the
opinion of such Finance Party, completion of any such form might
reasonably be expected to result in an adverse consequence with
respect to the business or tax position of such Finance Party.
15.6 TAX CREDITS
If the Borrower pays any additional amount under Clause 15.5(a) (a "TAX
PAYMENT") and any Finance Party effectively obtains a refund of tax or
credit against tax on its overall net income, by reason of that Tax
Payment (a "TAX CREDIT"), and the Finance Party is able to identify the
Tax Credit as being attributable to the Tax Payment, then the Finance
Party shall reimburse to the Borrower such amount as it shall determine
to be the proportion of the Tax Credit as will leave the Finance Party
after that reimbursement, in no better or worse position than it would
have been in if the Tax Payment had not been required. Each Finance
Party shall have an absolute discretion as to whether to claim any Tax
Credit and, if it does claim, the extent, order and manner in which it
does so. No Finance Party shall be obliged to disclose any information
regarding its tax affairs or computations to the Borrower. Nothing shall
interfere with the right of each Finance Party to arrange its tax
affairs in whatever manner it thinks fit.
15.7 DOUBLE TAX AGREEMENT
If for so long as the UK-Ghana Arrangement of 20 January, 1993 remains
in force and otherwise than as a result of the introduction of or change
in any law, regulation, published practice or concession of
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any relevant authority or the publicly stated interpretation of any of
the above occurring after the date of this Agreement, a Finance Party:
(a) is at the date of this Agreement a party to this Agreement and a
resident of the United Kingdom for the purposes of that UK -
Ghana Arrangement but thereafter ceases to be so resident; or
(b) is at the date of this Agreement a party to this Agreement and
does take any interest received by it under this Agreement into
account as a trading receipt of its business as such a resident
but thereafter ceases to do so,
the Borrower will not be liable to pay to that Finance Party under
Clause 15.5(a) any amount in respect of Taxes levied or imposed by Ghana
or any taxing authority of or in Ghana in excess of the amount it would
have been obliged to pay if the Finance Party was so resident or, as the
case may be, had taken such interest into account as a trading receipt
of such a business.
15.8 SET OFF
Each Obligor authorises each Finance Party after the occurrence of an
Event of Default to apply any credit balance to which the Obligor is
entitled on any account of the Obligor with that Finance Party (at any
office and in any currency or commodity (including Gold)) in or towards
satisfaction of any sum due and payable from the Obligor to any Finance
Party hereunder and for this purpose, each Finance Party is authorised
to purchase with the moneys standing to the credit of any such account
such other currencies as may be necessary to effect such application. No
Finance Party shall be obliged to exercise any right granted to it
pursuant to this Clause.
15.9 CURRENCY OF PAYMENT
(a) If:
(i) any amount payable by an Obligor under this Agreement or
any Finance Document is received by a Finance Party
entitled thereto in a currency ("PAYMENT CURRENCY")
other than the amount agreed to be payable in the
currency in which the relevant Obligation is denominated
(the "RELEVANT CURRENCY"), whether as a result of any
judgement or order or the enforcement thereof, the
liquidation of an Obligor or otherwise; and
(ii) the amount produced by converting the Payment Currency
so received into the Relevant Currency is less than the
required amount of the Relevant Currency, then the
Obligor shall, as an independent obligation separate and
independent from its other obligations contained
hereunder and in any other Finance Document, indemnify
such Finance Party for the deficiency and any loss
sustained as a result.
(b) Such conversion shall be made promptly following receipt at such
prevailing rate of exchange in such market as is reasonably
determined by such Finance Party as being most appropriate for
the conversion. The Obligor shall in addition pay the reasonable
costs of the conversion. Each Obligor waives any right it may
have in any jurisdiction to pay any amount under this Agreement
or any other Finance Document in a currency other than the
Relevant Currency.
(c) For the purposes of this Clause, a distribution hereunder or
under any other Finance Document by a Finance Party to or for
the account of another Finance Party shall be deemed to be a
payment by an Obligor.
15.10 NO OBLIGATIONS FOR MINE
It is expressly understood that none of the Independent Engineer, the
Insurance Consultant or any Finance Party assumes any obligation to any
Obligor or any other party in respect of the operation, development,
exploration and production of the Mine in accordance with the
Development Plan or otherwise.
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15.11 SURVIVAL
The obligations of any Obligor under Clauses 15.3, 15.4, 15.5 and 15.9
and the obligations of any Finance Party under Clause 12.40, shall, in
each case, survive any termination of this Agreement. The
representations and warranties made and indemnity and reimbursement
obligations of each Obligor in this Agreement and in each other Finance
Document to which it is a party shall survive the execution and delivery
of this Agreement and each such other Finance Document.
15.12 SEVERABILITY
If at any time any provision hereof or of any other Finance Document is
or becomes illegal, invalid or unenforceable in any respect under the
law of any jurisdiction, neither the legality, validity or
enforceability of the remaining provisions hereof nor the legality,
validity or enforceability of such provision under the law of any other
jurisdiction shall in any way be affected or impaired thereby.
15.13 HEADINGS
The various headings of this Agreement and of each other Finance
Document are inserted for convenience only and shall not affect the
meaning or interpretation of this Agreement or such other Finance
Document or any provisions hereof or thereof.
15.14 COUNTERPARTS, EFFECTIVENESS, ETC.
This Agreement may be executed by the parties hereto in several
counterparts, each of which shall, when executed, be deemed to be an
original and all of which shall constitute together one and the same
agreement. This Agreement shall become effective on the date (the
"EFFECTIVE DATE") when counterparts hereof executed on behalf of the
Obligors and each Finance Party shall have been received by the Security
Trustee.
15.15 JURISDICTION OF ENGLISH COURTS
(a) The courts of England have exclusive jurisdiction to settle any
dispute arising out of or in connection with this Agreement
(including a dispute regarding the existence, validity or
termination of this Agreement) (a "DISPUTE").
(b) The Parties agree that the courts of England are the most
appropriate and convenient courts to settle Disputes and
accordingly no Party will argue to the contrary.
(c) This Clause 15.15 is, as against the Obligors, for the benefit
of the Finance Parties only. As a result, no Finance Party shall
be prevented from taking proceedings against any Obligor
relating to a Dispute in any other courts with jurisdiction. To
the extent allowed by law, the Finance Parties may take
concurrent proceedings against any Obligor in any number of
jurisdictions.
15.16 SERVICE OF PROCESS
Without prejudice to any other mode of service allowed under any
relevant law, the Borrower:
(a) shall, on or prior to the New Ownership Date, irrevocably
appoint an agent for service of process ("PROCESS AGENT") in
relation to any proceedings before the English courts in
connection with any Finance Document; and
(b) agrees that failure by the Process Agent to notify the Borrower
of the process will not invalidate the proceedings concerned.
15.17 ENGLISH LANGUAGE
This Agreement and the other Finance Documents have been negotiated in
English and executed in the English language. All certificates, reports,
notices and other documents and communications given or
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delivered pursuant to this Agreement and the other Finance Documents
shall be in the English language or, if not in the English language,
shall be accompanied by a certified English translation thereof. In the
case of any document originally issued in a language other than English,
the English language version of any such document shall, absent manifest
error, control the meaning and interpretation of the matters set forth
therein.
15.18 PERPETUITIES
For the purposes of the Perpetuities and Accumulations Act of 1964, any
trusts created by this Agreement or in any other Finance Documents shall
be for a period of 80 years.
15.19 DELAY
No failure or delay on the part of any Finance Party in exercising any
power or right under this Agreement or any other Finance Document shall
operate as a waiver thereof, nor shall any single or partial exercise of
any such power or right preclude any other or further exercise thereof
or the exercise of any other power or right. No notice to or demand on
any Obligor in any case shall entitle it or any other Obligor to any
notice or demand in similar or other circumstances. No waiver or
approval by any Finance Party under this Agreement or any other Finance
Document shall, except as may be otherwise stated in such waiver or
approval, be applicable to subsequent transactions. No waiver or
approval hereunder shall require any similar or dissimilar waiver or
approval thereafter to be granted hereunder.
16. ACCESSION OF OTHER PARTIES
16.1 ADDITIONAL OBLIGORS
Any Holding Company or any other person may, subject to the Security
Trustee being satisfied that the security or other obligations provided
by each of the other Obligor are not adversely affected in any way by
the proposed accession of the Additional Obligor (and, if any such
security may be adversely affected, that all such action as the Security
Trustee may require will have been taken on or prior to the relevant
Obligor Deed of Accession taking effect in order to ensure that any such
adverse effect is avoided), become party hereto as an Additional Obligor
by unconditionally delivering or causing to be delivered unconditionally
to the Security Trustee an Obligor Deed of Accession duly executed by
the parties thereto in form and substance satisfactory to the Security
Trustee. The Additional Obligor shall also provide any documents
referred to under the heading "Additional Documentation" in the Obligor
Deed of Accession executed by it.
16.2 CONSTRUING AGREEMENT
Upon delivery to the Security Trustee of any Obligor Deed of Accession
referred to in Clause 16.1, this Agreement shall henceforth be read and
construed as if each person which is a party to such Obligor Deed of
Accession as an Additional Obligor were a party hereto having all the
rights and obligations of an Obligor hereunder and all references in
this Agreement to "Obligor" or "Obligors" shall be construed
accordingly.
17. ROLE OF THE LAW DEBENTURE TRUST CORPORATION P.L.C.
Each party to each Finance Document acknowledges that:
(a) The Law Debenture Trust Corporation p.l.c. ("LAWDEB") is a party
to the Asset Sale Agreements and the First Royalty Agreement in
its capacity as security trustee pursuant to the Definition &
Common Terms Agreement dated May 9, 1998 (as amended) (the
"DACTA") between, inter alia, Satellite Goldfields Limited and
certain other parties; and
(b) upon the resignation or removal of LawDeb as security trustee
pursuant to the DACTA, the obligations of LawDeb pursuant to the
Finance Documents to which it is a party shall cease and:
(i) any replacement security trustee shall, upon execution
of a Royalty Holder Deed of Accession by all parties
thereto, become a party to such Finance Documents as if
it
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had been a party to such Finance Documents from the date
LawDeb became party to such Finance Documents; and
(ii) if no such security trustee is appointed under the DACTA
following such resignation or removal (and until any
such replacement is effective), the liability of LawDeb
pursuant to any Finance Document to which it is a party
shall be limited to any rights of indemnity or assets
held on trust by it pursuant to the DACTA.
-86-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as a deed by their respective officers thereunto duly authorised on the
day and year first above written.
THE OBLIGORS
Signed as a deed by WEXFORD GOLDFIELDS )
LIMITED under a power of attorney ) ----------------------------------
) Signature
----------------------------------
Name Printed
----------------------------------
Title
Address for Notices: ▇/▇ ▇▇▇▇▇▇-▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Education Loop (off ▇▇▇▇▇▇ Road)
P.O. Box 1632
Accra, Ghana
S-1
THE FACILITY AGENT FOR ITSELF AND AS AGENT FOR THE LENDERS
STANDARD BANK LONDON LIMITED )
) ----------------------------------
Signature
----------------------------------
Name Printed
----------------------------------
Title
Address for Notices: ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Facsimile No.: + ▇▇ (▇)▇▇-▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
S-2
THE SECURITY TRUSTEE
STANDARD BANK LONDON LIMITED, as the ) ----------------------------------
Security Trustee ) Signature
----------------------------------
Name Printed
----------------------------------
Title
Address for Notices: ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Facsimile No.: ▇▇▇ (▇)▇▇-▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
S-3
The Common Seal of THE LAW DEBENTURE )
TRUST PLC was hereunto affixed in the )
presence of: )
---------------------------------
Signature
---------------------------------
Name Printed
---------------------------------
Title
---------------------------------
Signature
---------------------------------
Name Printed
---------------------------------
Title
Address for Notices: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇-▇▇▇▇▇
With a copy to: Standard Bank London Limited
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Attention: Mr. ▇▇▇▇▇▇▇ ▇▇▇▇▇
(as Administrative Agent pursuant to the DACTA)
S-4
SCHEDULE 1
DISCLOSURE SCHEDULE
Item 1 Approvals
Part A Current Approvals
Permit, Approval or
Agency Notification Date
------ ------------------- ----
None
Part B Pending Approvals
Permit, Approval or
Agency Notification Date
------ ------------------- ----
1. District Planning Authority Construction Permit Economic Completion Date
2. Chief Inspector of Mines Mining Permit Economic Completion Date
3. Environmental Protection Environmental Certificate Economic Completion Date
Agency
4. Government of Ghana Transfer of Mining Lease New Ownership Date
5. Environmental Protection Environmental Permit Economic Completion Date
Agency
6. Ministry of Mines Deed of Warranty, Conditions New Ownership Date
& Confirmation
7. Bank of Ghana Exchange Control Approval New Ownership Date
Item 2 Assets; Properties
None
Item 3 Environmental Matters
None.
Item 4 Liens
None
Item 5 Take or Pay Contracts
None
Item 6 Royalty Agreements
By virtue of the Minerals Royalties Regulations 1987 (L.I. 1349), mining
companies are subject to the payment of royalties to Ghana based on
profitability in terms of operating ratios which is the ratio expressed
in terms of the percentage which the operating margin bears to turnover
during each royalty period. The rate of royalty payable according to the
law as:
(a) Where the operating ratio is thirty per cent (30%) or less, the
rate of royalty payment is three per cent (3%) of turnover or
gross value of minerals won.
SS-1
(b) where the operating ratio is more than thirty per cent (30%) but
less than seventy per cent (70%) the rate of royalty payment is
three per cent (3%) plus 0.225 of every one per cent (1%) by
which the operating ratio exceeds thirty per cent (30%).
(c) where the operating ratio is seventy per cent (70%) or more the
rate of royalty payment is twelve per cent (12%).
(d) See also the Deed of Warranty.
The Borrower has or will enter into the First Royalty Agreement.
Item 7 Taxes
1. Corporate Tax -- 32.5% of taxable income of the Borrower.
2. Additional Profit Tax: 25% of the carry forward cash balance at the end
of each year of assessment.
3. Stamp Duty - payable on financial agreements and security documentation
at the rate of 0.5% of the amount financed.
4. Withholding tax is not payable on dividends.
5. 5% withholding tax on goods and services supplied of a value in excess
of Cedi 100,000.00.
6. Annual rental charges as may be prescribed by regulations applicable in
respect of the area to which the mining license of the Borrower relates.
As at the date hereof, these amounts equal 100,000 Cedis per annum.
7. Import duty payable on imported items other than plant, machinery,
equipment and accessories imported specifically and exclusively for the
commencement of the mineral operations at the rates set out below:
Description Import Duty Sales Tax
----------- ----------- ---------
4WD vehicles under 1900cc 10% 0
4WD vehicles between 1900cc 10% 15%
and 2500cc
4WD vehicles over 2500cc 25% 35%
Computers 10% 22 1/2%
Item 8 Material Agreements
1. All Operative Documents and all documents provided to the Facility Agent
prior to the New Ownership Date and identified by an attached
certificate signed by an Authorised Officer of the Borrower as a
"Material Agreement".
SS-1
SCHEDULE 2
SECURITY TRUSTEE DEED OF ACCESSION
THIS DEED is made on
BETWEEN:-
(1) [-] (the "NEW SECURITY TRUSTEE");
(2) [-] (the "RETIRING SECURITY TRUSTEE"); and
(3) [-] (the "REQUIRED SECURED PARTIES").
RECITAL:-
(A) This Deed is supplemental to a Common Terms Agreement dated [_], 2002
(the "CTA") between (1) Wexford Goldfields Limited (the Borrower), (2)
each other Obligor party hereto from time to time, (3) Standard Bank
London Limited (the Facility Agent and Security Trustee), and (4) The
Law Debenture Trust Corporation plc (the "FIRST ROYALTY HOLDER").
(B) This Deed has been entered into to record the accession of the New
Security Trustee under the CTA pursuant to the provisions of Clause
12.50 thereof.
NOW THIS DEED WITNESSETH as follows:-
1. DEFINITIONS
Terms defined in the CTA shall have the same meaning when used in this
Deed.
2. ACCESSION OF NEW SECURITY TRUSTEE
2.1 The New Security Trustee hereby agrees to be bound by all of the terms
of the CTA as if it had originally been party thereto.
2.2 The New Security Trustee confirms that its address details for notices
in relation to Clause 15.2 of the CTA are as follows:-
Address:
Telex:
Facsimile:
Attention:
2.3 By its signature below the Required Secured Parties confirm the
acceptance of the New Security Trustee for all purposes under the CTA in
accordance with Clause 12.50 thereof.
3. REPRESENTATIONS AND WARRANTIES
The New Security Trustee hereby represents and warrants for the benefit
of the Secured Parties that this Deed is within its powers, has been
duly authorised by it, constitutes its legal, valid and binding
obligations enforceable in accordance with their terms (subject as to
enforcement, to bankruptcy and insolvency laws and other similar laws of
applicability to creditors generally and to general equitable
principles) and does not conflict with any law or regulation or its
constitution documents or any document binding on it and that it has
obtained all necessary consents for the performance by it of this Deed.
SS-2
4. LAW
This Deed shall be governed by and construed in all respects in
accordance with English law.
5. COUNTERPARTS
The Deed may be executed in any number of counterparts and all of such
counterparts taken together shall be deemed to constitute one and the
same instrument.
IN WITNESS whereof this Deed has been duly executed as a deed on the day and
year first before written.
SS-2
SCHEDULE 3
OBLIGOR DEED OF ACCESSION
THIS DEED OF ACCESSION (THIS "DEED") IS MADE ON THE [ ] DAY OF [ ],[ ]
BETWEEN
[(1) [Additional Obligor] (the "ADDITIONAL OBLIGOR");] and
(2) [Security Trustee] on behalf of itself as Security Trustee and on behalf
of the Finance Parties (the "SECURITY TRUSTEE").
WHEREAS
(A) On [ ] a Common Terms Agreement (the "AGREEMENT") was entered into
by, inter alia, Wexford Goldfields Limited and the Security Trustee.
Pursuant to Clause 16.1 of the Agreement, any person may, at the
Security Trustee's discretion, become party to the Agreement by
executing a Deed of Accession, in the form attached to Schedule 8 of the
Agreement; and
(B) The Additional Obligor wishes to become a party to the Agreement as an
Obligor.
NOW IT IS HEREBY AGREED as follows:
1. INTERPRETATION
Save as otherwise defined herein, terms defined in the Agreement shall
bear the same meaning herein.
2. ADDITIONAL COMPANY
The Agreement shall henceforth be read and construed as if the
Additional Obligor were party to the Agreement having all the rights and
obligations of an Obligor thereunder (and all references to "Obligor" or
"Obligors") shall be construed accordingly.
3. REPRESENTATIONS
The Additional Obligor hereby represents and warrants in respect of
itself as if the representations set out in Clause 4 of the Agreement
were set out in full in this Deed and as follows: (1)[ ].
4. ADDITIONAL DOCUMENTS
(2)[ ]
5. COUNTERPARTS
This Deed may be signed in counterparts, all of which taken together
shall constitute a single deed.
6. LAW
This Deed shall be governed by, and construed in accordance with,
English law.
----------
(1) as required by Security Trustee
(2) Security Trustee to specify
SS-3
7. JURISDICTION
The Additional Obligor agrees that the process by which any suit, action
or proceeding is begun in relation to a Dispute may be served on it by
being delivered in connection with any suit, action or proceeding in
England, to:
[ ] at
[ ]
or its principal other place of business for the time being. If the
appointment of the person mentioned in this Clause 7 ceases to be
effective in respect of the Additional Obligor, the Additional Obligor
shall immediately appoint a further person in England to accept service
of process on its behalf in England and failing such appointment within
15 days, the Security Trustee shall be entitled to appoint such a person
by notice to Additional Obligor. Nothing contained herein shall affect
the right to serve process in any other manner permitted by law.
EXECUTED as a Deed on the day and year first before written.
[NB: address for Additional Company to be inserted]
SS-3
SCHEDULE 4
ROYALTY HOLDER DEED OF ACCESSION
THIS DEED is made on
BETWEEN:-
(1) [-] (the "NEW ROYALTY HOLDER");
(2) [-] (the "RETIRING ROYALTY HOLDER"); and
(3) [-] (the "BORROWER").
RECITAL:-
(A) This Deed is supplemental to a Common Terms Agreement dated [_], 2002
(the "CTA") between (1) Wexford Goldfields Limited (the Borrower), (2)
each other Obligor party hereto from time to time, (3) Standard Bank
London Limited (the Facility Agent and Security Trustee), and (4) The
Law Debenture Trust Corporation plc (the "FIRST ROYALTY HOLDER").
(B) This Deed has been entered into to record the accession of the New
Royalty Holder under the CTA pursuant to the provisions of Clause
13.3(a) thereof and the novation of the Royalty Agreement to the New
Royalty Holder pursuant to the provisions of Clause 5 of the Royalty
Agreement.
NOW THIS DEED WITNESSETH as follows:-
1. DEFINITIONS
Terms defined in the CTA shall have the same meaning when used in this
Deed.
2. ACCESSION OF NEW ROYALTY HOLDER
2.1 The New Royalty Holder hereby agrees to be bound by all of the terms of
the CTA and the Royalty Agreement, as if it had originally been party
thereto.
2.2 The New Royalty Holder confirms that its address details for notices in
relation to Clause 15.2 of the CTA are as follows:-
Address:
Telex:
Facsimile:
Attention:
2.3 The Retiring Royalty Holder and the New Royalty Holder agree to the
Retiring Royalty Holder transferring to the New Royalty Holder by
novation on the date hereof all of the Retiring Royalty Holder's rights
and obligations in accordance with Clause 13 of the CTA and Clause 5 of
the Royalty Agreement.
2.4 [ONLY INCORPORATE THIS CLAUSE 2.4 WHERE THE FIRST ROYALTY HOLDER IS THE
RETIRING ROYALTY HOLDER.] Nothing in any Finance Document obliges the
Retiring Royalty Holder to:
(a) accept a re-transfer from a New Royalty Holder of any of the
rights and obligations assigned or transferred under Clause 13
of the CTA or Clause 5 of the Royalty Agreement.;
SS-4
(b) support any losses directly or indirectly incurred by the New
Royalty Holder by reason of the non-performance by any Obligor
of its obligations under the Finance Documents or otherwise.
2.5 By their signature below the Retiring Royalty Holder and the Borrower
confirm their acceptance of the New Royalty Holder for all purposes
under the CTA and each other Finance Agreement to which the Retiring
Royalty Holder is a party in accordance with Clause 13.3(a) of the CTA.
3. REPRESENTATIONS AND WARRANTIES
3.1 The New Royalty Holder hereby represents and warrants for the benefit of
the Borrower that this Deed is within its powers, has been duly
authorised by it, constitutes its legal, valid and binding obligations
enforceable in accordance with their terms (subject as to enforcement,
to bankruptcy and insolvency laws and other similar laws of
applicability to creditors generally and to general equitable
principles) and does not conflict with any law or regulation or its
constitution documents or any document binding on it and that it has
obtained all necessary consents for the performance by it of this Deed.
3.2 [ONLY INCORPORATE THIS CLAUSE 3.2 WHERE THE FIRST ROYALTY HOLDER IS THE
RETIRING ROYALTY HOLDER.]. The Retiring Royalty Holder makes no
representation or warranty and assumes no responsibility to a New
Royalty Holder for:
(a) the legality, validity, effectiveness, adequacy or
enforceability of the Finance Documents or any other documents;
(b) the financial condition of any Obligor;
(c) the performance and observance by any Obligor of its obligations
under the Finance Documents or any other documents; or
(d) the accuracy of any statements (whether written or oral) made in
or in connection with any Finance Document or any other
document,
and any representations or warranties implied by law are excluded.
4. LAW
This Deed shall be governed by and construed in all respects in
accordance with English law.
5. COUNTERPARTS
The Deed may be executed in any number of counterparts and all of such
counterparts taken together shall be deemed to constitute one and the
same instrument.
IN WITNESS whereof this Deed has been duly executed as a deed on the day and
year first before written.
SS-4
SCHEDULE 5
FACILITY AGENT DEED OF ACCESSION
THIS DEED is made on
BETWEEN:-
(1) [-] (the "NEW FACILITY AGENT");
(2) [-] (the "RETIRING FACILITY AGENT"); and
(3) [-] (the "LENDERS").
RECITAL:-
(A) This Deed is supplemental to a Common Terms Agreement dated [_], 2002
(the "CTA") between (1) Wexford Goldfields Limited (the Borrower), (2)
each other Obligor party hereto from time to time, (3) Standard Bank
London Limited (the Facility Agent and Security Trustee), and (4) The
Law Debenture Trust Corporation plc (the "FIRST ROYALTY HOLDER").
(B) This Deed has been entered into to record the accession of the New
Facility Agent under the CTA pursuant to the provisions of Clause
13.3(b) thereof.
NOW THIS DEED WITNESSETH as follows:-
1. DEFINITIONS
Terms defined in the CTA shall have the same meaning when used in this
Deed.
2. ACCESSION OF NEW FACILITY AGENT
2.1 The New Facility Agent hereby agrees to be bound by all of the terms of
the CTA as if it had originally been party thereto.
2.2 The New Facility Agent confirms that its address details for notices in
relation to Clause 15.2 of the CTA are as follows:-
Address:
Telex:
Facsimile:
Attention:
2.3 By their signature below the Lenders confirm their acceptance of the New
Facility Agent for all purposes under the CTA in accordance with Clause
13.3(b) thereof.
3. REPRESENTATIONS AND WARRANTIES
The New Facility Agent hereby represents and warrants for the benefit of
the Lenders that this Deed is within its powers, has been duly
authorised by it, constitutes its legal, valid and binding obligations
enforceable in accordance with their terms (subject as to enforcement,
to bankruptcy and insolvency laws and other similar laws of
applicability to creditors generally and to general equitable
principles) and does not conflict with any law or regulation or its
constitution documents or any document binding on it and that it has
obtained all necessary consents for the performance by it of this Deed.
SS-5
4. LAW
This Deed shall be governed by and construed in all respects in
accordance with English law.
5. COUNTERPARTS
The Deed may be executed in any number of counterparts and all of such
counterparts taken together shall be deemed to constitute one and the
same instrument.
IN WITNESS whereof this Deed has been duly executed as a deed on the day and
year first before written.
SS-5
