Supporting Stockholders that were exercisable on, or would become exercisable within 60 days of, the date of the Voting Agreement), representing approximately 21.25% of all shares of Common Stock outstanding as of September 22, 2011 (including for this purpose 1,697,667 shares of Common Stock underlying stock options held by the Supporting Stockholders that were exercisable on, or would become exercisable within 60 days of, the date of the Voting Agreement). Additionally, the Supporting Stockholders owned (i) additional options to purchase an aggregate of 1,283,000 shares of Common Stock which are not exercisable within 60 days of the date of the Voting Agreements. All such shares underlying such options are subject to the terms of the Voting Agreement. All additional securities of the Company (including all additional shares of Common Stock and all additional options to acquire shares of Common Stock) the Supporting Stockholders acquires until the termination of the Voting Agreement will also be subject to the terms of the Voting Agreement. The Voting Agreement will automatically terminate upon the earliest to occur of (i) the termination of the Arrangement Agreement, (ii) the Effective Time (as defined in the Arrangement Agreement). The Voting Agreement may also be terminated with respect to any Supporting Stockholder by written consent of the Company, Minera Andes and such Supporting Stockholder. (c) Not applicable. (d) The Arrangement Agreement gives the Board of Directors of Minera Andes the one-time right to nominate persons to fill, effective immediately following the Effective Time, any vacancies on the Company’s board of directors, whether such vacancies are the result of the resignation of any member of the Company’s board of directors prior to the Effective Time or an increase in the size of the Company’s board of directors, such that such nominees, appointed or elected, would constitute at least 50% of the directors of the Company’s board of directors immediately following the Effective Time, subject to approval of such nominees by the Nominating and Corporate Governance Committee of the Company’s Board of Directors. Directors so designated by Minera Andes will serve on the Company’s Board of Directors until the Company’s first annual meeting of shareholders after the Effective Time and until their respective successors are elected and qualified, or until the death, resignation or removal of such director. (e) Under the terms of the Arrangement Agreement, the Company may not, without Minera Andes’s prior written consent, among other things, (i) declare or pay any dividends on, or make other distributions or return capital in respect of, any of its capital stock or any other equity interests, other than by a wholly-owned subsidiary to the Company or (ii) issue, sell, repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities or obligations convertible into, exercisable or exchangeable for, or any rights, warrants, calls, subscriptions or options to acquire, shares of its capital stock, subject to identified exceptions. (f) At the Effective Time, if the Arrangement is completed, Minera Andes will become a wholly-owned indirect subsidiary of the Company and, subject to approval by the shareholders of the Company, the Company will change its name to McEwen Mining, Inc. (g) In connection with the Arrangement Agreement, the Company will amend its certificate of incorporation to increase the number of authorized shares of common stock to authorize a class of undesignated or “blank check” preferred stock. Any issuance of preferred stock with voting rights could, under certain circumstances, have the effect of delaying or preventing a change of control of the Company by increasing the number of outstanding shares entitled to vote and the number of votes requires tot approve a change of control of the Company. (h) Not applicable. (i) Not applicable. (j) Other than as described above, the Reporting Persons currently have no plans or proposals which relate to, or may result in, any of the matters listed in Items 4(a)-(i) of this Schedule 13D (the Reporting Persons reserve the right to develop such plans or proposals). |