Exhibit 2.4
SHARE PLEDGE AGREEMENT
This Agreement dated this _____ day of May, 2004
BETWEEN;
PINE VALLEY MINING CORPORATION, a company incorporated under the
laws of the Province of British Columbia, having an address at Suite
3000 - 1055 West Georgia Street, Vancouver, BC., V6E 3R3
(the "Debtor")
AND:
MARUBENI CORPORATION, having an address at Xxxxx 000, Xxx Xxxxxx
Xxxxxx 1, 000 - 0xx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx, X0X 0X0
(the "Secured Party")
WHEREAS:
A. The Debtor, Falls Mountain Coal Inc. (the "Borrower") a British Columbia
company, and Pine Valley Coal Ltd. ("PVC"), an Alberta company and the
Secured Party have entered into a coal purchase and loan agreement dated
May 18, 2004 (as the same may be amended, extended, renewed, replaced,
restated and in effect from time to time the "Loan Agreement") providing,
inter alia, for certain financing to be made available by the Secured
Party to the Borrower in accordance with the terms and conditions of the
Loan Agreement;
B. Pursuant to the Loan Agreement the Debtor is required to grant to the
Secured Party the security created hereby as security for the due payment
of the principal and interest (including interest on overdue interest)
owing from time to time by the Borrower to the Secured Party under or
pursuant to the Loan Agreement, and of all other money for the time being
and from time to time owing under the Loan Agreement and for the
performance of the obligations of the Debtor, the Borrower and PVC under
the Loan Agreement (hereinafter collectively referred to as the
"Indebtedness and Liabilities").
NOW THEREFORE for valuable consideration (the receipt and sufficiency of which
are hereby acknowledged by the Debtor) the Debtor hereby agrees as follows:
1. Security
As general and continuing security and as a pledge and assignment to secure
the due payment and performance of the Indebtedness and Liabilities, the
Debtor:
(a) hereby assigns, pledges and hypothecates to the Secured Party, and
grants a security interest in, the shares described in Schedule A
and any other additional securities as may hereafter be delivered to
the Secured Party, or its agent, by the
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Debtor, subject to the terms hereof, together with all renewals and
replacements thereof and substitutions therefor (collectively the
"Pledged Securities") and agrees that such shares and all such
additional securities shall be held by the Secured Party or its
agent and, without limiting the generality of the foregoing, hereby
assigns to the Secured Party and grants to the Secured Party all of
the Debtor's right, title, claim and interest in and to the monies
otherwise due and payable or to become due and payable to the Debtor
under the terms of any of the Pledged Securities and all
distributions of income or capital thereof, thereon or therefrom or
proceeds (including proceeds of sale) therefrom and under any
further Pledged Securities evidencing re-investment of the whole or
any part of any monies paid under any of the Pledged Securities
whether by sale thereof or otherwise; and
(b) hereby grants a security interest in and assigns to the Secured
Party any and all right, title and interest that the Debtor may have
now or in the future to any and all amounts, including interest and
payments by way of distribution of income and return of capital, now
due or hereafter to become due to the Debtor relating to the Pledged
Securities (collectively the "Assigned Amounts"),
(the Pledged Securities, the Assigned Amounts and all monies and other
property referred to in subparagraphs (a) and (b) and all proceeds thereof
are collectively referred to as the "Collateral").
The Collateral will be held by the Secured Party or its agent as
collateral security in favour of, and as a fixed and specific assignment
to, and security interest in favour of the Secured Party to secure payment
and performance of the Indebtedness and Liabilities. The Collateral will
be subject to the terms hereof and the assignment and security interest
hereby constituted upon by virtue of delivery of the share certificate(s)
representing the Pledged Securities and without any further formality or
action on the part of the Debtor and the Secured Party.
2. Delivery
The Debtor hereby delivers to the Secured Party or its agent the share
certificates representing the shares described in Schedule A hereto, to be
held by the Secured Party or its agent on the terms and conditions
contained herein.
3. Representations and Warranties
The Debtor represents and warrants to the Secured Party that:
(a) it is the registered and beneficial owner of the Pledged Securities;
(b) the Pledged Securities are free and clear of all liens, mortgaged,
charges and security interests other than those created under this
Agreement in favour of the Secured Party;
(c) the Pledged Securities have been duly issued and are fully paid and
non-assessable; and
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(d) the Pledged Securities represent 100% of the issued and outstanding
shares in the capital of the Borrower.
4. Responsibility of the Secured Party
It is agreed that the responsibility of Secured Party or its agent in
regard to the Collateral will be limited to exercising the same degree of
care which the Secured Party or its agent give to their respective own
valuable property.
5. Rights of the Debtor
Subject to the provisions of this Agreement unless and until there is an
event of default by the Debtor under or pursuant to the Loan Agreement, or
any security granted pursuant thereto, and without prejudice to the fixed
and specific assignment and security interest hereby constituted, the
Debtor will be entitled to exercise all rights of a holder of the Pledged
Securities including, without limitation, any and all voting rights
appertaining to the Pledged Securities.
6. Rights of the Secured Party
The Debtor further agrees that:
(a) at any time after an event of default has occurred under or pursuant
to the Loan Agreement, or security held by the Secured Party
pursuant to the Loan Agreement, the Secured Party may forthwith,
without any notice, without demand for payment, without
advertisement, and without any other formality, all of which are
hereby waived, sell the Collateral or any of it on any recognized
exchange dealing in such securities or by public or private sale,
and enforce payment of and otherwise realize upon the security of
the Collateral or any of it as fully and effectually as if the
Secured Party were the absolute owners thereof, with all proceeds of
sale being paid to the Secured Party to be applied on account of the
Indebtedness and Liabilities to the full extent of the Indebtedness
and Liabilities and the balance, if any, remaining thereafter being
paid to the Debtor;
(b) the Secured Party will not be bound or obliged at any time or under
any circumstances, to collect or see to the payment of any income or
capital of, on or from any of the Collateral or to sell or otherwise
realize upon any of the Collateral;
(c) the Collateral or any excess thereof or proceeds of sale of the same
may be applied upon any of the Indebtedness and Liabilities in such
manner, order and priority as the Secured Party may determine;
(d) for the purposes of the foregoing provisions of this paragraph 5,
the Secured Party or its agent is hereby appointed as the attorney
irrevocable of the Debtor and in such capacity may transfer or
assign all or any of the Collateral and may fill in all blanks in
any transfers of stocks or any power of attorney or other documents
delivered to the Secured Party;
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(e) all costs and charges incurred by the Secured Party or its agent
with reference to the sale, enforcement or other realization of the
Collateral (including all broker's commissions, fees and other
remuneration and all legal costs) will be added to the Indebtedness
and Liabilities and will be a first charge upon the Collateral and
the proceeds thereof; and
(f) any substituted Pledged Securities will be held subject to the same
terms and conditions and with the same powers and authorities, as
are hereby declared and conferred.
7. Saving Provision
This will be a continuing agreement and the Collateral is in addition to
and not in substitution for any other security held or which may in the
future be held by the Secured Party in respect of the Indebtedness and
Liabilities and will not operate as a merger of any debt or suspend the
fulfilment of, or affect the rights, remedies and powers of the Secured
Party in respect of the Indebtedness and Liabilities or any Collateral
hereunder.
8. Term of Agreement
This Agreement and the pledge and assignment and security interest hereby
constituted will continue in full force and effect until such time as the
Indebtedness and Liabilities have been paid or otherwise satisfied in
full, whereupon the Secured Party will release the Collateral or so much
thereof as remains from the pledge and assignment and security interest
hereunder and execute and deliver to the Debtor such releases and
re-assignments as the Debtor may require for such purpose.
9. Governing Law
This Agreement will be governed by the laws of British Columbia.
10. Counterpart Execution
This Agreement may be executed in any number of counterparts as may be
necessary and delivered by facsimile each of which so signed shall be
deemed to be an original, and such counterparts together shall constitute
one and the same instrument and all counterparts will be construed
together and will constitute one and the same instrument.
11. Enurement
This agreement will enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
12. Conflict
If there is any conflict between the terms of this Agreement and the terms
of the Loan Agreement, the terms of the Loan Agreement shall prevail.
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13. Interpretation
It is agreed that the expressions "Debtor" and "Secured Party" wherever
used herein shall include the heirs, executors, administrators, successors
and assigns of the Debtor and the Secured Party respectively, and wherever
the singular or masculine is used throughout this Agreement the same shall
be construed as meaning the plural or the feminine or body corporate or
politic where the context or the parties to this Agreement so require.
14. Severability
If any term of this Agreement is determined to be invalid or
unenforceable, in whole or in part, the invalidity or unenforceability
will attach only to that term or part term, and the remaining part of the
term and all other terms of this Agreement will continue in full force and
effect. The parties will negotiate in good faith to agree to a substitute
term that is valid and enforceable while being as close as possible to the
intention of the invalid or unenforceable term. The invalidity or
unenforceability of a term in a particular jurisdiction will not affect
its validity or enforceability in any other jurisdiction where it is valid
or enforceable.
15. Further Assurance
The Debtor will from time to time do all acts and things and execute and
delver all deeds, transfers, assignments and instruments as the Secured
Party may reasonably require to perfect the security interest created by
this Agreement and to facilitate the sale or transfer of the Pledged
Securities under any realization of them, and to permit the Secured party
to exercise all power, authority and discretion given to it.
16. Acknowledgement and Waiver
The Debtor hereby:
(a) acknowledges receiving a copy of this Agreement; and
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(b) waives all right to receive from the Secured Party a copy of any
financing statement, financing change statement or verification
statement filed or issued, as the case may be, at any time in
respect of this Agreement or any amendment thereto.
Dated the day and year first above written.
PINE VALLEY MINING CORPORATION
by its authorized signatory(ies):
Per: ___________________________
Per: ___________________________
Falls Mountain Coal Inc. acknowledges the pledge of the Shares by the Debtor in
favour of the Secured Party this ____ day of May, 2004 and confirms that it will
not issue any additional shares in its capital during the term of this
Agreement, without first obtaining the Secured Party's consent, which will not
be unreasonably withheld.
..
FALLS MOUNTAIN COAL INC.,
by its authorized signatory:
Per: ____________________________
SCHEDULE A
Description of Share Certificate(s)
The Following shares in the capital stock of Falls Mountain Coal Inc. registered
in the name of Pine Valley Mining Corporation
SHARE CERTIFICATE NO. CLASS OF SHARES: NUMBER OF SHARES
3 common voting 2 shares
4 common voting 10 shares
POWER OF ATTORNEY TO SELL AND TRANSFER SECURITIES
2 , common voting , shares (herein referred to as the "Shares")
---------- -----------------------
(Number) Class)
of the Capital Stock of FALLS MOUNTAIN COAL INC.
------------------------------------------------------
(Name of Corporation)
(hereinafter referred to as the "Corporation") represented by Share Certificate
Number 3
---------
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
_________________________________________________________ of ______________
__________________________________________________, the Shares above mentioned
standing in the name of the undersigned on the Books of the Corporation and
hereby irrevocably constitutes and appoints ____________________________________
the Attorney of the undersigned to transfer the said Shares on the Books of the
Corporation with full power of substitution in the premises.
DATED ____________________________, 20_____
PINE VALLEY MINING CORPORATION
by its authorized signatory (ies)
Per: __________________________
Per: __________________________
(Leave undated)
POWER OF ATTORNEY TO SELL AND TRANSFER SECURITIES
10 , common voting , shares (herein referred to as the "Shares")
---------- -----------------------
(Number) Class)
of the Capital Stock of FALLS MOUNTAIN COAL INC.
------------------------------------------------------
(Name of Corporation)
(hereinafter referred to as the "Corporation") represented by Share Certificate
Number 4
---------
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
_________________________________________________________ of ______________
__________________________________________________, the Shares above mentioned
standing in the name of the undersigned on the Books of the Corporation and
hereby irrevocably constitutes and appoints ____________________________________
the Attorney of the undersigned to transfer the said Shares on the Books of the
Corporation with full power of substitution in the premises.
DATED ____________________________, 20_____
PINE VALLEY MINING CORPORATION
by its authorized signatory (ies)
Per: __________________________
Per: __________________________
(Leave undated)
