PURCHASE AND SALE AGREEMENT
BETWEEN
INDEPENDENCE MINING COMPANY INC.
AND
ATLAS CORPORATION
October 25, 1995
TABLE OF CONTENTS
Page
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ARTICLE I PURCHASE OF INDEPENDENCE'S INTEREST IN THE PROPERTIES................... 1
1.1 Transfer of Interests to Atlas.................................. 1
1.2 Purchase Price.................................................. 1
ARTICLE II CLOSING................................................................. 2
2.1 Closing......................................................... 2
2.2 Deliveries at Closing........................................... 2
ARTICLE III OTHER AGREEMENTS OF INDEPENDENCE AND ATLAS.............................. 3
3.1 Information and Data............................................ 3
3.2 Transfer of Permits............................................. 4
3.3 Assumption of Obligations....................................... 4
3.4 NYSE Listing Requirements....................................... 4
3.5 Reasonable Best Efforts; Further Assurances..................... 4
3.6 Access to Records Before Closing................................ 4
3.7 Sales, Use, Transfer and Other Taxes............................ 4
3.8 BLM Exchange Property........................................... 5
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF INDEPENDENCE.......................... 6
4.1 Representations and Warranties of Independence.................. 6
(a) Organization and Standing................................ 6
(b) Qualification............................................ 6
(c) Corporate Power.......................................... 6
(d) Authorization............................................ 6
(e) Royalties................................................ 7
(f) Permits and Licenses..................................... 7
(g) Title to Claims.......................................... 7
(h) Water Rights............................................. 9
(i) Environmental Compliance................................. 9
(j) Material Contracts and Commitments....................... 9
(k) Legality.................................................10
(l) Litigation and Claims....................................10
(m) Consents.................................................10
(n) Taxes....................................................10
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(o) Brokerage or Finder's Fee................................10
(p) Investment Intent........................................10
(q) Private Placement Representations........................11
(r) Disclaimer of Warranties.................................11
ARTICLE V REPRESENTATIONS AND WARRANTIES OF ATLAS.................................11
5.1 Representations and Warranties of Atlas.........................11
(a) Organization and Standing................................11
(b) Qualification............................................11
(c) Corporate Power..........................................12
(d) Authorization............................................12
(e) Brokerage or Finder's Fee................................12
(f) The Shares...............................................12
(g) Financial Statements and Reports.........................13
(h) Absence of Certain Changes...............................13
(i) Disclaimer of Warranties.................................14
(j) Investigation............................................14
ARTICLE VI INDEMNIFICATION.........................................................14
6.1 Indemnification of Independence.................................14
6.2 Indemnification of Atlas........................................15
6.3 Notification; Defense of Third-Party Claims.....................15
6.4 Notice; Defense of Non-Third-Party Claims.......................16
6.5 Threshold.......................................................16
6.6 Affiliate Indemnitees...........................................16
6.7 Reliance Upon Representations and Warranties....................16
ARTICLE VII CONDITIONS PRECEDENT TO CLOSING.........................................17
7.1 Mutual Conditions...............................................17
(a) Litigation...............................................17
7.2 Conditions to Independence's Obligations........................17
(a) Representations and Warranties True......................17
(b) No Material Event........................................17
(c) Consents and Waivers.....................................17
(d) Performance of Obligations...............................17
7.3 Conditions to Atlas' Obligations................................17
(a) Representations and Warranties True......................18
(b) No Material Event........................................18
(c) Consents and Waivers.....................................18
(d) Performance of Obligations...............................18
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ARTICLE VIII [intentionally omitted].................................................18
ARTICLE IX SURVIVAL OF REPRESENTATIONS AND WARRANTIES..............................18
9.1 Survival........................................................18
ARTICLE X GENERAL PROVISIONS......................................................18
10.1 Notices.........................................................18
10.2 Governing Law...................................................19
10.3 Parties in Interest; Assignment.................................20
10.4 Entire Agreement................................................20
10.5 Modifications; Waiver...........................................20
10.6 Severability....................................................20
10.7 Remedies Cumulative.............................................20
10.8 Attorneys' Fees.................................................20
10.9 Counterparts....................................................20
10.10 Further Assurances..............................................20
10.11 Headings........................................................21
10.12 Public Announcements............................................21
10.13 Confidentiality.................................................21
10.14 Certain Definitions.............................................21
10.15 Inconsistencies with Exhibits...................................23
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SCHEDULES AND EXHIBITS
SCHEDULE 4.1(e) ROYALTIES
SCHEDULE 4.1(f) PERMITS AND LICENSES
SCHEDULE 4.1(h) WATER RIGHTS
SCHEDULE 5.1(f) ATLAS CONVERTIBLE SECURITIES AND REGISTRATION RIGHTS
SCHEDULE 5.1(h) ATLAS ADVERSE CHANGES
EXHIBIT A-1 DESCRIPTION OF ACQUIRED CLAIMS, LOCATED CLAIMS AND LEASED
CLAIMS
EXHIBIT A-2 EXCHANGE PROPERTY
EXHIBIT B-1 REAL PROPERTY QUITCLAIM DEED
EXHIBIT B-2 ASSIGNMENT OF LEASES
EXHIBIT B-3 BILL OF SALE
EXHIBIT B-4 WATER RIGHTS QUITCLAIM DEED
EXHIBIT B-5 ASSUMPTION AGREEMENT
EXHIBIT C FORM OF OFFICER'S CERTIFICATE - INDEPENDENCE
EXHIBIT D REGISTRATION RIGHTS AGREEMENT
EXHIBIT E FORM OF OFFICER'S CERTIFICATE - ATLAS
EXHIBIT F OPINIONS OF COUDERT BROTHERS AND MORRISON & FOERSTER
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PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT ("Agreement") is made and entered
into this twenty-fifth day of October, 1995, between INDEPENDENCE MINING COMPANY
INC., a Delaware corporation, ("Independence"), whose address is 5251 DTC
Parkway, Suite 700, Englewood, Colorado 80111 and ATLAS CORPORATION, a Delaware
corporation ("Atlas"), whose address is Suite 3150, 370 Seventeenth Street,
Denver, Colorado 80202.
RECITALS
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WHEREAS, Independence is the owner of the Doby George and Maggie
Summit properties located in Elko County, Nevada, as more particularly described
in Exhibit A attached hereto and incorporated herein by reference; and
WHEREAS, Independence desires to sell and Atlas desires to purchase
all of Independence's right, title and interest in and to said properties,
including all mines and associated facilities, permits, water rights, and
rights-of-way owned or held by Independence in connection therewith (the
"Properties");
NOW, THEREFORE, in consideration of the mutual promises herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
PURCHASE OF INDEPENDENCE'S INTEREST IN THE PROPERTIES
-----------------------------------------------------
Transfer of Interests to Atlas. On the terms and subject to the
------------------------------
conditions set forth herein, Independence agrees to deliver to Atlas at the
closing provided for in Article II hereof (the "Closing") (a) a Real Property
Quitclaim Deed, (b) an Assignment of Leases, (c) a Bill of Sale and (d) a Water
Rights Quitclaim Deed collectively conveying the Properties from Independence to
Atlas, in the forms attached hereto as Exhibit B, and certain other instruments
and documents as are set forth in Section 2.2(a).
Purchase Price. The purchase price (the "Purchase Price") to be
--------------
paid to Independence by Atlas pursuant to this Agreement is 1,400,000 shares
(the "Shares") of Atlas common stock, par value $1.00 per share (the "Common
Stock"), and Four Hundred Thousand and No/100 Dollars ($400,000.00). On the
terms and subject to the conditions set
forth herein, at the Closing Atlas agrees to pay the Purchase Price to
Independence and deliver certain other documents, all as described in Section
2.2(b).
ARTICLE II
CLOSING
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Closing. Upon the terms and subject to the conditions set forth
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in this Agreement, the Closing of the transactions provided for in Article I
hereof will take place at the offices of Davis, Graham & Stubbs, L.L.C., in
Denver, Colorado, on October 25, 1995, or such other date as mutually agreed by
the parties (the "Closing Date").
Deliveries at Closing. At the Closing:
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Independence will deliver to Atlas the following:
An executed and acknowledged Real Property Quitclaim
Deed covering the Acquired Claims and the Located Claims (as set forth in parts
(ii) and (iii) of Exhibit A-1) in the form attached hereto as Exhibit B-1;
An executed and acknowledged Assignment of Leases
covering the Leased Claims (as set forth in part (i) of Exhibit A-1) in the form
attached hereto as Exhibit B-2;
An executed and acknowledged Bill of Sale covering any
personal property associated with the Acquired Claims, the Located Claims or the
Leased Claims in the form attached hereto as Exhibit B-3;
An executed and acknowledged Water Rights Quitclaim
Deed covering the Water Rights in the form attached hereto as Exhibit B-4;
Certificates of good standing for Independence from the
Secretary of State of the States of Delaware and Nevada; and
An Officer's Certificate in the form attached hereto as
Exhibit C.
Atlas will deliver to Independence the following:
A certificate or certificates representing the Shares,
registered in Independence's name and bearing the following legend:
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The shares represented by this Certificate have not
been registered under the Securities Act of 1933, as amended (the
"Act"), and are "restricted securities" as that term is defined in
Rule 144 under the Act and may not be sold, transferred, assigned,
pledged or hypothecated except pursuant to an effective registration
statement or an opinion of counsel reasonably satisfactory to Atlas
Corporation to the effect that registration under the Act is not
required. The shares are being acquired solely for the purpose of
investment, and not with a view to the distribution or sale of any
part thereof. The shares have been acquired subject to the terms and
conditions of that certain Purchase and Sale Agreement between
Independence Mining Company Inc. and Atlas Corporation dated October
25, 1995.
$400,000.00 in immediately available funds, plus an
amount of money (in immediately available funds) equal to the federal and state
claim holding and filing fees required to maintain the Properties in good
standing, prorated on a daily basis to the date hereof, for the assessment year
commencing September 1, 1995;
If the Closing occurs on or after November 4, 1995,
$30,000.00 in immediately available funds in respect of Independence's payment
to Thomas E. and Frances Bilbao under a certain Mining Lease dated November 4,
1983 as more fully described in Exhibit A-1;
An assumption of obligations in the form of the
Assumption Agreement attached hereto as Exhibit B-5 as required by Section 3.3;
A registration rights agreement pertaining to the
Shares in the form of Exhibit D;
A certificate of good standing for Atlas from the
Secretary of State of the State of Delaware;
An Officer's Certificate in the form attached hereto as
Exhibit E; and
The opinions of Coudert Brothers and Morrison &
Foerster in the form of Exhibit F hereto.
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ARTICLE III
OTHER AGREEMENTS OF INDEPENDENCE AND ATLAS
------------------------------------------
Information and Data. Upon Closing, Independence shall deliver
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to Atlas originals and copies of all records, data and information in its
possession relating to the Properties, including, without limitation, title and
environmental data, and all maps, surveys, technical reports, drill logs, and
all metallurgical, geological, geophysical, geochemical, permitting and other
technical data pertaining to the Properties in its possession; provided,
however, that Independence may retain copies of any or all of such data; and
provided, further, that if any such data includes information other than with
respect to the Properties the data may be excerpted so as to provide only the
information with respect to the Properties.
Transfer of Permits. For a period of sixty days following
-------------------
Closing, Independence shall cooperate with Atlas to achieve, to the extent
reasonably possible, the assignment from Independence to Atlas of any existing
permits with respect to the Properties.
Assumption of Obligations. Upon Closing, Atlas shall assume
-------------------------
Independence's obligations in connection with the Properties as set forth in the
Assumption Agreement, including obligations arising under any permits issued by
any federal, state or local authority, and reclamation obligations, and Atlas
will execute an assumption of such obligations in the form of Exhibit B-5.
NYSE Listing Requirements. At the time of Closing, Atlas shall
-------------------------
have complied with the requirements of the New York Stock Exchange regarding the
issuance by Atlas of the Shares, and the Shares shall have been accepted for
listing on such exchange.
Reasonable Best Efforts; Further Assurances. Subject to the
-------------------------------------------
terms and conditions herein provided, each of the parties hereto agrees to use
its reasonable best efforts to take, or cause to be taken, all action, and to
do, or cause to be done, all things reasonably necessary, proper or advisable
under applicable laws and regulations to consummate and make effective the
transactions contemplated by this Agreement. Atlas and Independence will each
use their respective reasonable best efforts (without incurring any
extraordinary expense or payment to any third party in excess of $2,500, or
instituting litigation) to obtain consents of all third parties and governmental
bodies necessary to the consummation of the transactions contemplated by this
Agreement; provided, however, that the foregoing expense limitation shall not
apply to Atlas' costs in acquiring any permits from Independence or to any
action necessary or advisable in connection with the issuance, listing or
registration of the Shares. As used herein, "Further Assurances" shall mean any
deeds, assignments, consents, powers of attorney or other documents which may be
reasonably required to transfer ownership of the Properties to Atlas, to confirm
such ownership or facilitate effective recordation thereof, or to put Atlas in
actual possession and operating control of the Properties.
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Access to Records Before Closing. Prior to the Closing Date,
--------------------------------
each of the parties agrees that it will give, or cause to be given, to the other
party and its representatives, during normal business hours upon reasonable
notice and at the other party's expense, full and unrestricted access to its
personnel, officers, agents, employees, assets, properties, titles, contracts,
books, records, files and documents with respect to, in Independence's case, the
Properties, and in Atlas' case, Atlas (including financial, tax, budget,
projections, auditors' work papers and other information) and to such party's
personnel, as is reasonably necessary to allow such other party to obtain such
information as it shall desire, and to make copies of all such materials. All
materials copied pursuant hereto shall be maintained in confidence and all such
copies shall be returned to the party providing such materials if the
transactions contemplated hereunder fail to occur.
Sales, Use, Transfer and Other Taxes. Any sales and use taxes
------------------------------------
and real property transfer taxes imposed on the transfer of the Properties by
Independence to Atlas shall be paid by Atlas. The parties shall cooperate in
obtaining any available exemptions from sales, use and transfer taxes. Prior to
Closing, Independence shall pay all expenses owed by it ordinarily paid in the
normal course of owning the Properties. All claim transfer fees assessed by the
United States, Department of the Interior, Bureau of Land Management (the
"BLM"), and all expenses of recording instruments of conveyance covering the
Properties shall be paid by Atlas.
BLM Exchange Property. Independence has entered into an exchange
---------------------
agreement with the BLM to obtain fee title to the property on which certain
unpatented mining claims held by Independence are located (the "Exchange
Property"). The Exchange Property is more particularly described in Exhibit A-
2.
Certain unpatented mining claims held by Independence and comprising a
portion of the Properties are located on and, in some instances, extend across
the exterior boundaries of the Exchange Property (the "Exchange Claims"). The
Exchange Claims are more particularly described in Exhibit A-2.
The conveyance of fee title to the Exchange Property to Atlas is not a
condition to Closing and the parties understand and agree that the consummation
of the contemplated exchange with the BLM may occur after the Closing or not at
all. Independence is in no manner obligated by this Agreement or otherwise to
complete the exchange and convey fee title to the Exchange Property to Atlas.
However, if Independence completes the contemplated exchange with the BLM and is
conveyed fee title to the Exchange Property, for no additional consideration,
Independence shall convey to Atlas all of its right, title and interest in and
to the Exchange Property and the fractions of the Exchange Claims that remain on
the public lands adjacent to the Exchange Property without any representations
and warranties of title, whatsoever.
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If Independence does not complete the contemplated exchange with the
BLM and/or is not conveyed fee title to the Exchange Property, for any reason,
including, without limitation, a discretionary decision by Independence not to
complete the exchange, for no additional consideration, Independence shall
convey to Atlas all of its right, title and interest in and to the Exchange
Claims. Real property transfer taxes associated with the foregoing conveyance
to Atlas shall be paid by Atlas; all costs and expenses to complete the
contemplated exchange with the BLM shall be paid by Independence.
Notwithstanding anything in this Agreement that may appear to be to the
contrary, this Section 3.8 shall survive Closing until the conveyance to Atlas
of the Exchange Property and the fractions of the Exchange Claims or the
Exchange Claims, whichever is applicable. Unless otherwise agreed by
Independence and Atlas, if the contemplated exchange with the BLM is not
completed on or before September 30, 1998, Independence shall convey to Atlas
the Exchange Claims on or before October 31, 1998. Such conveyance will be made
subject to the same representations set forth in Section 4.1(g)(ii) hereof,
which representations shall survive for a period of 45 days from the date of
conveyance.
From the Closing through conveyance to Atlas of the Exchange Property
or the Exchange Claims, whichever is applicable, Independence grants to Atlas
non-exclusive access to and the non-exclusive right to use and occupy the
surface and subsurface of the Exchange Claims for all lawful and reasonable
purposes, including, without limitation, properly permitted exploration,
development, mining, mineral processing or related activities. During the
period from Closing through the conveyance to Atlas of the Exchange Property or
the Exchange Claims, Atlas agrees to pay all claim rental and maintenance fees
required to be paid under federal law in lieu of performance of assessment work
in order to maintain the Exchange Claims and to make such filings and record
such documents as are required to maintain those claims as valid (including,
without limitation, timely and properly making filings required under FLPMA, as
defined below). Atlas agrees to indemnify, defend and hold Independence
harmless from and against any and all Losses, as defined in Section 6.1 below,
incurred or sustained by Independence in or as a result of or in any way related
to Atlas' activities on, in or in the vicinity of the Exchange Claims.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
------------------------------
OF INDEPENDENCE
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Representations and Warranties of Independence. Independence
----------------------------------------------
hereby represents and warrants to Atlas as of the date hereof as follows, and
this Agreement is made in reliance on the following representations and
warranties, each of which is deemed to be a separate representation and
warranty:
Organization and Standing. Independence is a corporation
-------------------------
duly incorporated, validly existing, and in good standing under the laws of the
State of Delaware.
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Qualification. Independence is duly qualified to do
-------------
business in the State of Nevada and each additional jurisdiction in which the
nature of property owned or leased or the nature of the business conducted by it
requires such qualification, except where the failure to be so qualified would
not have a material adverse effect on the business, operation, or financial
condition of Independence.
Corporate Power. Independence has the requisite corporate
---------------
power and authority (i) to enter into this Agreement and all other agreements
contemplated hereby, and (ii) to carry out and perform its obligations under the
terms and provisions of this Agreement and all agreements contemplated hereby.
Authorization. All corporate action on the part of
-------------
Independence and its officers, directors and shareholders necessary for the
execution, delivery, and performance of this Agreement and all other agreements
of Independence contemplated hereby, has been taken. This Agreement and all
agreements and instruments contemplated hereby to which Independence is a party,
when executed and delivered by the parties thereto, will be legal, valid, and
binding obligations of Independence enforceable against Independence in
accordance with their respective terms. The execution, delivery and performance
of this Agreement by Independence will not violate any provision of law; any
order of any court or other agency of government; or any provision of any
indenture, agreement or other instrument to which Independence is a party or by
which its properties or assets are bound; or be in conflict with, result in a
breach of or constitute (with due notice and lapse of time) a default under any
such indenture, agreement or other instrument, in each case except for such
matters as would not have a material adverse effect on the Properties taken as a
whole. There is no law, rule or regulation, nor is there any judgment, decree or
order of any court or governmental authority binding on Independence which would
be contravened by the execution, delivery, performance or enforcement of this
Agreement or any instrument required hereunder, except for such matters as would
not have a material adverse effect on the Properties taken as a whole.
Notwithstanding the foregoing, no representation is made as to (i) the remedy of
specific performance or other equitable remedies for the enforcement of this
Agreement or any other agreement contemplated hereby or (ii) rights to indemnity
under this Agreement for securities law liability. Additionally, this
representation is limited by applicable bankruptcy, insolvency, moratorium and
other similar laws affecting generally the rights of creditors and secured
parties.
Royalties. Except as set forth on Schedule 4.1(e), to
---------
Independence's Knowledge there are no royalties or other burdens on production
affecting the Properties.
Permits and Licenses. To Independence's Knowledge,
--------------------
Independence has obtained all permits, licenses, approvals, authorizations and
qualifications from all federal, state and local authorities required for it to
carry on its operations at or on the
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Properties, except for such matters as would not have a material adverse effect
on the Properties taken as a whole. A list of all currently active material
permits, licenses, consents, approvals, authorizations, and qualifications
obtained by Independence in connection with its operations on the Properties as
of the date of this Agreement, true and correct copies of each of which have
been made available to Atlas, is set forth on Schedule 4.1(f). To Independence's
Knowledge, its ownership and operation of the Properties is not in violation of
and has resulted in no liability (other than liability for compliance with
existing permits and laws, including but not limited to performance of
reclamation) under any statute, rule or regulation of any governmental authority
applicable to the Properties, other than violations or liability, if any, which
have not resulted and would not be reasonably expected to result in any material
loss or liability.
Title to Claims. Except as disclosed in Exhibit A, to
---------------
Independence's Knowledge:
Leased Claims. Each of the leases set forth in Exhibit A-1
-------------
(the "Leases") is in full force and effect in accordance with its terms, free
from material default by Independence; and Independence has received no written
or other notice from any lessor under any Lease asserting a default by
Independence in the performance of the terms of any Lease. As to the Leased
Claims, subject to the paramount title of the United States, to Independence's
Knowledge: (A) Independence is in exclusive possession thereof, free and clear
of all liens, encumbrances or other burdens on production (except as set forth
on Schedule 4.1(e)) or claims of third parties arising by, through or under
Independence; (B) since Independence acquired a leasehold interest in the
unpatented Leased Claims, assessment work, intended in good faith to satisfy the
requirements of state and federal laws and regulations and generally regarded in
the mining industry as sufficient, for all assessment years up to and including
the assessment year ending September 1, 1992, was timely performed on or for the
benefit of those Leased Claims and affidavits evidencing such work were timely
recorded; (C) since Independence acquired a leasehold interest in the unpatented
Leased Claims, claim rental and maintenance fees required to be paid under
federal law in lieu of the performance of assessment work, in order to maintain
those Leased Claims commencing with the assessment year ending on September 1,
1993 and through the assessment year ending on September 1, 1996, have been
timely and properly paid, and affidavits or other notices evidencing such
payments and required under federal or state laws or regulations have been
timely and properly filed or recorded; (D) since Independence acquired a
leasehold interest in the unpatented Leased Claims, all filings with the BLM
with respect to those Leased Claims which are required under the Federal Land
Policy and Management Act of 1976, as amended ("FLPMA") have been timely and
properly made, and (E) there are no actions or administrative or other
proceedings pending or threatened against or affecting the Leased Claims.
Nothing herein shall be deemed a representation that any of the unpatented
Leased Claims contains a discovery of valuable minerals.
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Acquired Claims. As to the Acquired Claims, subject to the
---------------
paramount title of the United States, to Independence's Knowledge: (A)
Independence is in exclusive possession thereof; free and clear of all liens,
encumbrances or other burdens on production (except as set forth on Schedule
4.1(e)) or claims of third parties arising by, through or under Independence;
(B) since Independence acquired the Acquired Claims, assessment work, intended
in good faith to satisfy the requirements of state and federal laws and
regulations and generally regarded in the mining industry as sufficient, for all
assessment years up to and including the assessment year ending September 1,
1992, was timely performed on or for the benefit of the Acquired Claims and
affidavits evidencing such work were timely recorded; (C) since Independence
acquired the Acquired Claims, claim rental and maintenance fees required to be
paid under federal law in lieu of the performance of assessment work, in order
to maintain the Acquired Claims commencing with the assessment year ending on
September 1, 1993 and through the assessment year ending on September 1, 1996,
have been timely and properly paid, and affidavits or other notices evidencing
such payments and required under federal or state laws or regulations have been
timely and properly filed or recorded; (D) since Independence acquired the
Acquired Claims, all filings with the BLM with respect to the Acquired Claims
which are required under the FLPMA have been timely and properly made, and (E)
there are no actions or administrative or other proceedings pending or
threatened against or affecting the Acquired Claims. Nothing herein shall be
deemed a representation that any of the Acquired Claims contains a discovery of
valuable minerals.
Located Claims. As to the Located Claims, to Independence's
--------------
Knowledge: (A) Independence is in exclusive possession thereof; free and clear
of all liens, encumbrances or other burdens on production (except as set forth
on Schedule 4.1(e)) or claims of third parties arising by, through or under
Independence; (B) the Located Claims were located, staked, filed and recorded on
available public domain land in compliance with all applicable state and federal
laws and regulations; (C) assessment work, intended in good faith to satisfy the
requirements of state and federal laws and regulations and generally regarded in
the mining industry as sufficient, for all assessment years up to and including
the assessment year ending September 1, 1992, was timely performed on or for the
benefit of the Located Claims and affidavits evidencing such work were timely
recorded; (D) claim rental and maintenance fees required to be paid under
federal law in lieu of the performance of assessment work, in order to maintain
the Located Claims commencing with the assessment year ending on September 1,
1993 and through the assessment year ending on September 1, 1996, have been
timely and properly paid, and affidavits or other notices evidencing such
payments and required under federal or state laws or regulations have been
timely and properly filed or recorded; (E) all filings with the BLM with respect
to the Located Claims which are required under the FLPMA have been timely and
properly made, and (F) there are no actions or administrative or other
proceedings pending or to the knowledge of Independence threatened against or
affecting the Located Claims. Nothing herein shall be deemed a representation
that any of the Located Claims contains a discovery of valuable minerals.
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Claim Remonumentation. With respect to each of the
---------------------
unpatented mining claims comprising a portion of the Properties, Independence
represents that they have been remonumented as necessary, and that evidence of
such remonumentation has been timely and properly recorded, all in compliance
with the provisions of N.R.S. (S) 517.030.
Water Rights. Set forth on Schedule 4.1(h) is a list that,
------------
to Independence's Knowledge, correctly and completely describes all water
rights, whether surface, underground, direct flow, reservoir, storage, or
otherwise held or utilized by Independence in connection with its operations at
the Properties.
Environmental Compliance. To the Knowledge of Independence,
------------------------
there are no conditions or activities at or on the Properties which would result
in a violation of or liability under applicable Environmental Laws, except for
such matters as would not have a material adverse effect on the Properties taken
as a whole. To the Knowledge of Independence, there have been issued under
applicable Environmental Laws no notices of violation or consent orders to which
Independence (with respect to its operations at the Properties) or the
Properties are subject, except for such matters as would not have a material
adverse effect on the Properties taken as a whole. There are no pending or, to
the Knowledge of Independence, threatened proceedings by or before any court or
other governmental authority against Independence with respect to its operation
or ownership of the Properties alleged to be, or have been, in violation of,
under, any Environmental Law, except for such matters as would not have a
material adverse effect on the Properties taken as a whole.
Material Contracts and Commitments. Independence has
----------------------------------
performed all material obligations required to be performed by it under all
contracts and commitments affecting the Properties to which it is a party, a
complete list of which is set forth on Exhibit A-1, Schedule 4.1(e), Schedule
4.1(f) and Schedule 4.1(h), and true and correct copies of each of which have
been made available to Atlas, and is not in default, and will not be in default
as a result of the consummation of the transactions contemplated herein, under
any contract, agreement, mortgage, indenture, loan agreement, lease, license,
judgment, injunction, decree, order, determination, award, restriction, or other
instrument to which it is a party in connection with the Properties, except for
such matters as would not have a material adverse effect on the Properties taken
as a whole.
Legality. To the Knowledge of Independence, Independence's
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operations on the Properties have been conducted in material compliance with
applicable laws, rules, ordinances and other governmental regulations,
including, without limitation, those relating to zoning, condemnation, mining,
reclamation, environmental matters, equal employment, and federal, state, or
local health and safety laws, rules, and regulations, except for such violations
as would not materially adversely affect the Properties.
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Litigation and Claims. To the Knowledge of Independence,
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other than matters affecting the U.S. mining industry as a whole, there are no
actions, suits or proceedings pending or threatened against or affecting the
Properties, including any actions, suits, or proceedings being prosecuted by any
federal, state, or local department, commission, board, bureau, agency, or
instrumentality. To the Knowledge of Independence, Independence is not in any
material default with respect to, or subject to, any order, writ, injunction,
judgment or decree of any court or any federal, state or local department,
commission, board, bureau, agency or instrumentality which relates to the
Properties.
Consents. Independence has obtained all consents,
--------
approvals, authorizations, declarations, or filings required by any federal,
state, local, or other authority, or any lenders, lessors, creditors, and other
third parties in connection with the valid execution, delivery, and performance
by it of this Agreement and the consummation by it of the transactions
contemplated hereby, except such consents which are customarily obtained
following an assignment or conveyance of mining properties as contemplated
hereby.
Taxes. Independence, so long as it has been in possession
-----
of the Properties, has duly and timely filed, in correct form, all federal,
state and local income, excise, property and other tax returns, reports or
statements required to be filed by it with respect to the Properties and has
fully paid all taxes, fees, assessments, penalties, and interest due in respect
of any such returns, reports, or statements, except for such matters as would
not have a material adverse effect on the Properties taken as a whole.
Brokerage or Finder's Fee. All negotiations relative to
-------------------------
this Agreement and the transactions contemplated hereby have been carried on by
Independence in such manner as not to give rise to any valid claim against Atlas
for a brokerage commission, finder's fee, or other fee or commission arising by
reason of the transactions contemplated by this Agreement.
Investment Intent. Independence is acquiring the Shares
-----------------
solely for the purpose of investment, and not with a view to the distribution or
sale of any part thereof. Independence acknowledges that the Shares have not
been registered under the Securities Act or any state securities law, and are
being issued and sold in reliance on exemptions from such registration
requirements that are available only if the Shares are not being offered to the
public and are being acquired for investment and not with a present view to
their distribution or sale.
Private Placement Representations.
---------------------------------
(A) Independence can bear the economic risk of losing its
entire investment in the Shares and can afford to hold the Shares for an
indefinite period of time; and
-11-
Independence is an Accredited Investor as
defined in Rule 501(a) of Regulation D of the Securities Act.
Independence has received, read and reviewed and is familiar
with Atlas's Form 10-K for the year ended June 30, 1995, and its Annual Report
to Stockholders for 1995 and its Form 8-K dated October 4, 1995 (collectively,
the "Reports"), and confirms that all requested documents, records and books
pertaining to its investment in Atlas have been made available or delivered to
it.
Independence has had the opportunity to ask questions of,
and receive answers from, officers of Atlas concerning its investment in the
Shares and additional information necessary to verify the accuracy of the
information contained in the Reports.
Disclaimer of Warranties. EXCEPT AS PROVIDED IN THIS
------------------------
AGREEMENT, INDEPENDENCE MAKES NO WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO
THE PROPERTIES AS TO TITLE, OWNERSHIP, USE, POSSESSION, MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, MINERAL QUANTITY, MINERAL RESERVES, MINERAL RESOURCES,
ORE GRADES, RECOVERABILITY, VALUE, MINEABILITY, CONDITION, OPERATION, DESIGN,
CAPACITY OR OTHERWISE.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF ATLAS
---------------------------------------
Representations and Warranties of Atlas. Atlas hereby represents
---------------------------------------
and warrants to Independence as of the date hereof as follows, and this
Agreement is made in reliance on the following representations and warranties,
each of which is deemed to be a separate representation and warranty:
Organization and Standing. Atlas is a corporation duly
-------------------------
incorporated, validly existing, and in good standing under the laws of the State
of Delaware.
Qualification. Atlas is duly qualified to do business in
-------------
each jurisdiction in which the nature of property owned or leased or the nature
of the business conducted by it requires such qualification, except where the
failure to be so qualified would not have a material adverse effect on the
business, operation, or financial condition of Atlas.
Corporate Power. Atlas has the requisite corporate power
---------------
and authority (i) to enter into this Agreement and all other agreements
contemplated hereby, and
-13-
(ii) to carry out and perform its obligations under the terms and provisions of
this Agreement and all agreements contemplated hereby.
Authorization. The requisite corporate action on the part
-------------
of Atlas necessary for the execution, delivery, and performance of this
Agreement and all other agreements of Atlas contemplated hereby has been taken.
This Agreement and all agreements and instruments contemplated hereby to which
Atlas is a party, when executed and delivered by the parties thereto, will be
the legal, valid, and binding obligations of Atlas enforceable against Atlas in
accordance with their respective terms. The execution, delivery, and performance
of this Agreement by Atlas will not violate any provision of law; any order of
any court or other agency of government; or any provision of any indenture,
agreement or other instrument to which Atlas is a party or by which its
properties or assets are bound; or be in conflict with, result in a breach of or
constitute (with due notice and lapse of time) a default under any such
indenture, agreement or other instrument. There is no law, rule or regulation,
nor is there any judgment, decree or order of any court or governmental
authority binding on Atlas which would be contravened by the execution, delivery
performance or enforcement of this Agreement or any instrument required
hereunder, except for such matters as would not, individually or in the
aggregate, have a material adverse effect on the business, assets, liabilities
(actual or contingent), results of operations, prospects, financial or other
condition or operations of Atlas. Notwithstanding the foregoing, no
representation is made as to (i) the remedy of specific performance or other
equitable remedies for the enforcement of this Agreement or any other agreement
contemplated hereby or (ii) rights to indemnity under this Agreement for
securities law liability. Additionally, this representation is limited by
applicable bankruptcy, insolvency, moratorium and other similar laws affecting
generally the rights of creditors and secured parties.
Brokerage or Finder's Fee. All negotiations relative to
-------------------------
this Agreement and the transactions contemplated hereby have been carried on by
Atlas in such manner as not to give rise to any valid claim against Independence
for a brokerage commission, finder's fee or other fee or commission arising by
reason of the transactions contemplated by this Agreement.
The Shares. On the date of this Agreement, the authorized
----------
capital stock of Atlas consists of 50,000,000 shares of Common Stock, 18,634,743
shares of which are issued and outstanding, none of which are held in Atlas's
treasury, and 1,000,000 shares of preferred stock, par value $1.00 per share.
The preferred stock is issuable in series, with designations, rights and
preferences to be fixed by Atlas' Board of Directors. The Board of Directors has
established a series of 150,000 shares of Series Preferred Stock designates
Series A Junior Participating Preferred Stock, no shares of which have been
issued. Except as set forth on Schedule 5.1(f), Atlas does not have outstanding
any stock or securities convertible or exchangeable for any shares of its
capital stock. The Shares have been duly authorized for issuance and reserved
therefor and, when issued, all of the Shares shall be
-13-
validly issued, fully paid and nonassessable shares of capital stock of Atlas,
free and clear of all liens, charges and encumbrances. There does not exist any
preemptive right in favor of any person with respect to the Shares. Except as
set forth on Schedule 5.1(f), there does not exist any agreement by Atlas to
register any stock or securities of Atlas for sale under the Securities Act.
Financial Statements and Reports.
--------------------------------
Since July 1, 1994, and through the Closing Date, Atlas has
filed all required forms, reports and documents with the U.S. Securities and
Exchange Commission (the "SEC") required to be filed by it pursuant to the
federal securities laws and the SEC rules and regulations thereunder, all of
which have complied as of their respective filing dates and, if applicable,
effective dates in all material respects with all applicable requirements of the
Securities Act of 1933, as amended (the "Securities Act") and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the rules promulgated
thereunder. None of such forms, reports or documents, including, without
limitation, any financial statements or schedules included therein, at the time
filed or at the time effective, contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading.
As of the Closing Date, the audited consolidated balance
sheets and the related consolidated statements of net earnings and of changes in
financial position or cash flows, as the case may be (including the related
notes thereto), of Atlas included in Atlas's Annual Reports on Form 10-K for the
fiscal years or periods ended June 30, 1995 and 1994, respectively, present
fairly the consolidated financial position of Atlas as of their respective
dates, and the results of consolidated operations and changes in consolidated
financial position or cash flows, as the case may be, for the periods presented
therein, all in conformity with generally accepted accounting principles
consistently applied, except as otherwise noted therein.
As of the Closing Date, except as and to the extent set
forth on the consolidated balance sheet of Atlas as at June 30, 1995, including
the notes thereto, neither Atlas nor any of its subsidiaries has any liabilities
or obligations of any nature (whether accrued, absolute, contingent or
otherwise) which would be required to be reflected on a balance sheet, or in the
notes thereto, prepared in accordance with generally accepted accounting
principles, except for liabilities or obligations incurred in the ordinary
course of business since June 30, 1995 which would not, individually or in the
aggregate, have a material adverse effect on the business, assets, liabilities
(actual or contingent), results of operations, prospects, financial or other
condition or operations of Atlas.
-14-
Absence of Certain Changes. Except as set forth on Section
--------------------------
5.1(h), since June 30, 1995 and through the Closing Date, there has not been:
any material adverse change, however caused, in the
business, assets, liabilities (actual or contingent), results of operations,
prospects, financial or other condition or operations of Atlas;
any change in Atlas's authorized or actual equity
capitalization;
any damage, destruction or casualty loss, materially and
adversely affecting the business, assets, liabilities (actual or contingent),
results of operations, prospects, or financial or other condition or operations
of Atlas, whether or not insured;
any incurrence of long-term debt or any other material
liability or obligation, actual or contingent, other than current liabilities
incurred in the ordinary and usual course of business consistent with past
practices;
entry into, or agreement or commitment to enter into, any
agreement, commitment or transaction (including, without limitation, any
borrowing, capital expenditure or financing or any amendment, modification or
termination of any existing agreement, commitment or transaction) other than in
the ordinary and usual course of business consistent with past practices;
acquisition or disposition of, or entry into any agreement
with respect to the acquisition or disposition of a significant amount of
assets; or
any agreement with respect to any of the foregoing.
Disclaimer of Warranties. EXCEPT AS PROVIDED IN THIS
------------------------
AGREEMENT, ATLAS MAKES NO WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE
SHARES.
Investigation. Atlas has conducted its own investigation
-------------
and made its own evaluation of the Properties, and is relying solely on such
investigation and the specific representations of Independence in Article IV
hereof in determining to proceed with the transaction contemplated by this
Agreement. The scope of Atlas' investigation was determined by Atlas in its sole
discretion. From its business, Atlas is familiar with properties and property
acquisitions similar to the Properties and the transactions contemplated hereby.
-15-
ARTICLE VI
INDEMNIFICATION
---------------
Indemnification of Independence. Except as provided in Section
-------------------------------
6.3, Atlas hereby agrees to indemnify, defend and hold Independence, its
successors and assigns, harmless from and against any and all liabilities,
claims, damages, losses, or expenses (including interest and penalties,
reasonable attorneys' fees, and other reasonable expenses of defending any
actions relating thereto) (collectively, "Losses") incurred or sustained by
Independence in or as a result of or arising out of any breach or inaccuracy of
the specific representations and warranties made by Atlas herein, or the breach
by Atlas of any of the agreements, covenants, conditions, and obligations of
Atlas contained in this Agreement, including but not limited to those set forth
in the Assumption of Obligations. In addition, Atlas fully releases and
discharges Independence and agrees to save, defend and indemnify Independence
against and hold it harmless from any and all Losses directly or indirectly
relating to (i) any release or threat of release of any Hazardous Materials (as
hereinafter defined) in, on, under or from any of the Properties whenever
occurring or (ii) any violation of any Environmental Law (as hereinafter
defined) relating to the Properties whenever occurring.
Indemnification of Atlas. Except as provided in Section 6.3,
------------------------
Independence hereby agrees to indemnify, defend and hold Atlas, its successors
and assigns, harmless from and against any and all Losses incurred or sustained
by Atlas in or as a result of or arising out of (a) any breach or inaccuracy of
the specific representations and warranties made by Independence in (i) Sections
4.1(a), 4.1(b), 4.1(c), 4.1(d), 4.1(o), 4.1(p) and 4.1(q) hereof, and (ii)
Section 4.1(g) hereof, and (b) the breach by Independence of any of the post-
Closing agreements, covenants and obligations of Independence contained in this
Agreement.
Notification; Defense of Third-Party Claims. An indemnified
-------------------------------------------
person or entity shall give written notice to the indemnifying person or entity
promptly of any claim, suit, action, the commencement of any proceeding or
demand of which such indemnified person or entity has received written notice
from a third party (that is, a party other than a party to this Agreement) and
as to which such indemnified person or entity believes it may be entitled to
indemnification or contribution hereunder or under this Agreement (provided,
that failure to give such notice which does not materially disadvantage the
indemnifying person or entity shall not relieve the indemnifying person or
entity from liability hereunder). The indemnifying person or entity will not
settle or compromise any such pending claim, action or suit, without (i) the
prior written consent of the indemnified person or entity, which consent shall
not be unreasonably withheld, and (ii) obtaining a release of the indemnified
person or entity from all liability in respect thereof. The indemnifying person
or entity shall have the right to participate in or assume and direct the
defense at its own expense against any such claim, suit or demand, in its name
or in the name of the indemnified person, as the case may
-16-
be, and with counsel selected by the indemnifying person; provided, that if (i)
such claim, suit or demand seeks an order, injunction or other equitable relief
against the indemnified person or entity or (ii) the indemnified person or
entity shall have reasonably concluded that there is a substantial conflict of
interest between the indemnifying person or entity and the indemnified person or
entity in the conduct of the defense of such claim, suit or demand, then the
indemnified party may employ separate counsel and participate in and direct the
defense of such claim, suit or demand to the extent necessary to protect its
interest and the indemnifying person or entity will pay the reasonable fees and
disbursements of such separate counsel; provided, however, that the indemnifying
person or entity shall not be responsible for the fees and disbursements of more
than one separate counsel for all indemnified persons or entities in any
jurisdiction or in any single proceeding. Except as provided in the preceding
sentence, after notice from the indemnifying party of its election to assume the
defense thereof, the indemnifying person or entity shall not be liable to the
indemnified party for any legal or other expense incurred by the indemnified
party in connection with such claim. Such assumed defense shall be conducted
expeditiously (but with regard to obtaining the most favorable outcome
reasonably likely under the circumstances, taking into account costs) and the
indemnified person or entity shall be advised promptly of all significant
developments. The indemnified person or entity shall have the right to
participate fully in the defense of any claim, suit or demand so assumed, with
separate counsel selected by it and at its own expense. The indemnified person
or entity shall cooperate with the indemnifying person or entity, and keep the
indemnifying person or entity reasonably informed, in its participation or
defense of any such claim, suit or demand.
Notice; Defense of Non-Third-Party Claims. An indemnified person
-----------------------------------------
or entity shall give written notice to an indemnifying person or entity promptly
of any other claim it may have for indemnification under this Article 6;
provided, that failure to give such notice which does not materially
disadvantage the indemnifying person or entity shall not relieve the
indemnifying person or entity from liability hereunder. No indemnified person or
entity shall be entitled to make any claim for indemnification under this
Article 6 with respect to any breach of any particular representation or
warranty, after the date on which such representation and warranty ceases to
survive pursuant to Article 9; provided, however, that, if prior to the close of
-------- -------
business on the date any representation or warranty ceases to survive, the
indemnifying party shall have received written notification of a claim for
indemnity hereunder containing the basis of any such claim and a brief statement
of the relevant facts to the extent known, and such claim shall not have been
finally resolved or disposed of on that date, such claim shall continue as a
basis for indemnity until finally resolved or disposed of.
Threshold. No claim may be made for indemnification pursuant to
---------
this Article 6 with respect to any individual item of liability or damage
arising out of the breach or inaccuracy of any representation or warranty unless
such item or any series of items arising out of the related or similar facts
exceeds $1,000 and unless and until the aggregate of all such
-17-
liabilities and damages shall exceed $50,000, in which case the indemnifying
party shall then be liable for all Losses, including the original $50,000.
Affiliate Indemnitees. Rights of indemnity (or rights to be held
---------------------
harmless) created in this Agreement stated as in favor of either of the parties
hereto shall also be in favor of the officers and directors of each respective
party and its Affiliates (as hereinafter defined).
Reliance Upon Representations and Warranties. Unless any officer
--------------------------------------------
or other managerial personnel of any of the parties has actual Knowledge or
notice of any facts or circumstances which would contravene any of the
representations, warranties and covenants set forth herein, the parties hereto
shall be entitled to rely upon the representations, warranties, and covenants
set forth herein. Any provision herein to the contrary notwithstanding, neither
party shall have any liability or obligation to the other for any liability,
claim, damage, loss or expense arising out of any fact, inaccuracy or breach
concerning any representation or warranty, if the fact, inaccuracy or breach was
actually known on the date hereof by an officer or managerial employee of the
party in whose favor the representation or warranty runs.
ARTICLE VII
CONDITIONS PRECEDENT TO CLOSING
-------------------------------
Mutual Conditions. The respective obligations of each party to
-----------------
be bound by the terms and provisions of this Agreement shall be subject to the
fulfillment at or prior to Closing of the following condition:
Litigation. As of the Closing Date, no claim, litigation,
----------
proceeding, order, investigation, or inquiry shall be pending against a party or
threatened to enjoin or prevent the consummation of the transactions
contemplated by this Agreement.
Conditions to Independence's Obligations. The obligation of
----------------------------------------
Independence to be bound by the terms and provisions of this Agreement and to
consummate the transactions contemplated hereby shall be subject to the
fulfillment at or prior to Closing of the following conditions, unless such
performance and compliance shall have been waived in writing by Independence:
Representations and Warranties True. All representations
-----------------------------------
and warranties of Atlas contained in Article V shall be true on and as of the
Closing Date with the same force and effect as though made on and as of such
date.
No Material Event. No casualty, claim, or other event,
-----------------
fact, or condition shall have occurred which could materially adversely affect
Atlas.
-18-
Consents and Waivers. At or prior to Closing, the parties
--------------------
hereto shall have obtained all consents and waivers to be obtained by it
necessary for the consummation of the transactions contemplated by this
Agreement.
Performance of Obligations. At or prior to Closing, Atlas
--------------------------
shall have performed all of the obligations to be performed by it under this
Agreement prior to Closing, and under any exhibit, schedule, list, agreement, or
other instrument relating hereto.
Conditions to Atlas' Obligations. The obligation of Atlas to be
--------------------------------
bound by the terms and provisions of this Agreement and to consummate the
transactions contemplated hereby shall be subject to the fulfillment at or prior
to Closing of the following conditions, unless such performance and compliance
shall have been waived in writing by Atlas:
Representations and Warranties True. All representations
-----------------------------------
and warranties of Independence contained in Article IV shall be true on and as
of the Closing Date with the same force and effect as though made on and as of
such date.
No Material Event. No casualty, claim, or other event,
-----------------
fact, or condition shall have occurred which could materially adversely affect
the Properties.
Consents and Waivers. At or prior to Closing, Independence
--------------------
shall have obtained all consents and waivers to be obtained by it necessary for
the consummation of the transactions contemplated by this Agreement.
Performance of Obligations. At or prior to Closing,
--------------------------
Independence shall have performed all of the obligations to be performed by it
under this Agreement prior to Closing, and under any exhibit, schedule, list,
agreement, or other instrument relating hereto.
ARTICLE VIII
[intentionally omitted]
-19-
ARTICLE IX
SURVIVAL OF REPRESENTATIONS AND WARRANTIES
Survival. All statements, representations, warranties,
--------
indemnities, covenants and agreements made by Atlas shall survive the Closing
Date for a period of twenty-four months. Except for the representations of
Independence set forth in Sections 4.1(a), 4.1(b), 4.1(c), 4.1(d), 4.1(o),
4.1(p), 4.1(q) and 4.1(r), and the agreement of Independence set forth in
Section 6.2(a)(i), which shall survive the Closing for a period of twenty-four
months, and for the representations of Independence set forth in Section 4.1(g)
and the agreement of Independence set forth in Section 6.2(a)(ii), which shall
survive the Closing Date for a period of forty-five days, the statements,
representations, warranties, covenants and agreements made by Independence
herein shall not survive the Closing Date. The foregoing limitations shall not
apply to any right of action based on the parties' obligations set forth in the
Deed, the Assignment, the Bill of Sale or the Assumption Agreement, and in the
second sentence of Section 6.1, or on the fraud, bad faith or intentional
misrepresentation of any party hereto; any such right shall survive the Closing
Date until the expiration of the applicable statute of limitations.
ARTICLE X
GENERAL PROVISIONS
------------------
Notices. Any notice or communication hereunder shall be in
-------
writing, and shall be mailed by registered or certified mail, return receipt
requested, or otherwise sent by facsimile or other similar form of rapid
transmission, confirmed by mailing (in the manner stated above) at substantially
the same time as such rapid transmission, or personally delivered to the
receiving party or an officer thereof. If notice is given by registered or
certified mail, it shall be deemed to have been given and received when
deposited in the United States mail, return receipt requested, properly
addressed, with postage prepaid; and if given otherwise than by registered or
certified mail, it shall be deemed to have been given when delivered to and
received by the party to whom it is addressed at the time received. The
addresses of the parties for the purposes of this Section are as follows:
Independence Mining Company Inc.
5251 DTC Parkway, Suite 700
Englewood, Colorado 80111
Attention: Robert W. Micsak
Vice President
Telecopy: (303) 889-0707
-20-
with a copy to:
Davis, Graham & Stubbs, L.L.C.
370 Seventeenth
Street
Suite 4700
Denver, Colorado 80202
Telecopy: (303) 893-1379
Attention: Ronald R. Levine, II
Atlas Corporation
370 Seventeenth Street
Suite 3150
Denver, Colorado 80202
Attention: Gregg B. Shafter
Vice President
Telecopy: (303) 892-8808
with a copy to:
Morrison & Foerster
370 Seventeenth Street, Suite 5200
Denver, Colorado 80202
Telecopy: (303) 592-1510
Attention: Randy Hubbard
Any party hereto, by written notice to the other party, may change the address
for notices to be sent to it.
Governing Law. This Agreement, and the rights and liabilities of
-------------
the parties hereunder, shall be governed by and construed in accordance with the
laws of the State of Colorado governing contracts to be performed wholly within
Colorado, without regard to laws that might govern under principles of conflicts
of laws applicable thereto.
Parties in Interest; Assignment. All of the terms and provisions
-------------------------------
of this Agreement shall be binding upon and inure to the benefit of and be
enforceable by the respective parties hereto and their successors and permitted
assigns, whether hereinabove so expressed or not. The rights, powers,
privileges, and interests hereunder shall be assignable by either party, except
as specifically limited by this Agreement.
Entire Agreement. This Agreement contains the entire agreement
----------------
and understanding of the parties hereto and supersedes all prior written or oral
agreements and understanding between them concerning or relating to the subject
matter contained herein.
-21-
There are no representations, agreements, arrangements, or understandings, oral
or written, between the parties hereto relating to the subject matter contained
in this Agreement which are not fully expressed herein.
Modifications; Waiver. Any amendment, change or modification of
---------------------
this Agreement shall be void unless in writing and signed by all parties hereto.
No failure or delay by any party hereto in exercising any right, power or
privilege hereunder (and no course of dealing between or among any of the
parties) shall operate as a waiver of any such right, power or privilege. No
waiver of any default on any one occasion shall constitute a waiver of any
subsequent or other default. No single or partial exercise of any such right,
power or privilege shall preclude the further or full exercise thereof.
Severability. In the event that any one or more of the
------------
provisions contained in this Agreement or in any other instrument or agreement
contemplated hereby shall, for any reason, be held to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality, or unenforceability
shall not affect any other provision of this Agreement or any such other
instrument or agreement.
Remedies Cumulative. The remedies of the parties under this
-------------------
Agreement are cumulative and shall not exclude any other remedies to which any
party may be lawfully entitled.
Attorneys' Fees. In the event of any controversy, claim, or
---------------
dispute between the parties hereto, arising out of or relating to this Agreement
or the breach thereof, the prevailing party shall be entitled to recover from
the losing party reasonable expenses and attorneys' fees.
Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall constitute the same instrument.
Further Assurances. At the request of either Independence or
------------------
Atlas, the parties shall execute and deliver any further instruments,
agreements, documents or other papers and take such other action as may be
reasonably requested by the other party to effect the purposes of this Agreement
and the transactions contemplated hereby; provided, that Atlas' and
Independence's obligations in connection with registration of the Shares shall
be set forth in the Registration Rights Agreement.
Headings. The Article and Section headings contained in this
--------
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. References to Articles, Sections,
Exhibits, and Schedules are to such hereof.
-22-
Public Announcements. Prior to the Closing Date, Independence
--------------------
shall obtain Atlas' written consent before making, and Atlas shall obtain
Independence's written consent before making, any public announcements with
respect to this Agreement, any related agreement or the transactions
contemplated hereunder or thereunder, unless such public announcement is
required under applicable laws or securities exchange regulations. The consent
requirements of this Section 10.12 shall also apply to any public announcements
made by either party concerning the Closing.
Confidentiality. Except as otherwise provided in Section 10.12,
---------------
the parties hereto and their collective representatives shall forever treat
confidentially all information concerning the terms and conditions of this
Agreement, all related agreements, and of the transactions contemplated
hereunder or thereunder (collectively, "Confidential Information"); provided,
however, that Confidential Information shall not include information which
concerns the Properties or Atlas' operations thereon following the Closing or
which is or becomes generally known to the public not as a result of any breach
of this provision by any party or its representatives. The obligation to treat
the Confidential Information confidentially shall not apply to the extent that
any party or its representatives shall be required to disclose any such
information in connection with an investigation or legal proceeding where the
failure to disclose such information could result in liability for contempt or
other censure or penalty; provided, however, that such party and/or its
representatives shall notify the other party as soon as possible and in any
event prior to such disclosure and shall cooperate with the other party in the
event that the other party elects to legally contest such disclosure.
Certain Definitions. As used in this Agreement, the terms set
-------------------
forth below, when capitalized, have the following meanings:
"$" shall mean U.S. dollars.
"Affiliate" means any person or entity related to a party in such
a way that either the party or such person or entity directly or
indirectly controls or is controlled by or is under common
control with the other. For this purpose, "control" means the
power, direct or indirect, to direct or cause direction of
management and policies through ownership of voting securities,
contract, voting interest or otherwise.
-23-
"Environmental Laws" means any federal, state, local or foreign
statute, law, ordinance, regulation, rule, code, order,
requirement or rule of common law, now or previously in effect,
and any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent decree or
judgment, relating to the environment, health, safety or
Hazardous Materials, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended ("CERCLA"); the Resource Conservation and
Recovery Act, 42 U.S.C. (S)(S) 6901 et seq.; the Hazardous
-- ---
Materials Transportation Act, 49 U.S.C. (S)(S) 6901 et seq.; the
-- ---
Clean Water Act, 33 U.S.C. (S)(S) 1251 et seq.; the Toxic
-- ---
Substances Control Act, 15 U.S.C. (S)(S) 2601 et seq.; the Clean
-- ---
Air Act, 42 U.S.C. (S)(S) 7401 et seq.; the Safe Drinking Water
-- ---
Act, 42 U.S.C. (S)(S) 300f et seq.; the Atomic Energy Act, 42
-- ---
U.S.C. (S)(S) 2011 et seq.; the Federal Insecticide, Fungicide
-- ---
and Rodenticide Act, 7 U.S.C. (S)(S) 136 et seq.; and the Federal
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Food, Drug and Cosmetic Act, 21 U.S.C. (S)(S) 301 et seq.
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"Hazardous Materials" means (a) petroleum and petroleum products,
radioactive materials, asbestos in any form that is or could
become friable, urea formaldehyde foam insulation, and
transformers or other equipment that contain polychlorinated
biphenyls, or (b) any other chemical, material or substance
which is (i) designated as a "hazardous substance," pursuant
to Section 311 of the Clean Water Act ("CWA"), 33 U.S.C. (S)
1251, et seq. (33 U.S.C. (S) 1321) or listed pursuant to
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Section 307 of the CWA (33 U.S.C. (S) 1317, or (ii) defined as
or included in the definition of a "hazardous waste" pursuant
to Section 1004 of the Resource Conservation and Recovery Act
("RCRA"), 42 U.S.C. (S) 6901, et seq. (42 U.S.C. (S) 6903), or
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(iii) defined as or included in the definition of a "hazardous
substance" pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act
("CERCLA"), 42 U.S.C. (S) 9601, et seq., or (iv) defined as or
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included in the definition of a "pollutant" or "contaminant"
pursuant to the CWA, RCRA, CERCLA, the Clean Air Act, 33
U.S.C. (S) 1251 et seq. , or comparable state statutes or
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regulations.
"Knowledge" or any variation thereof shall mean as to the facts
or circumstances represented: (a) actual knowledge of (i) any of
the officers of Independence or Jerry W. Bateman, Independence's
current Land Manager, with respect to matters concerning
Independence, or (ii) any of the officers of Atlas, with respect
to matters concerning Atlas; or (b) knowledge that any such
person should have obtained in conducting a reasonable inquiry as
to the relevant business, operations, properties, documents,
agreements, and records considering such person's particular
position and responsibilities with Independence, on the one hand,
or Atlas, on the other hand.
Inconsistencies with Exhibits. To the extent there are any
-----------------------------
inconsistencies between the terms and provisions of this Agreement and the terms
and provisions of any Exhibit hereto, the terms and provisions of this Agreement
shall control,
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed on the day first above written.
INDEPENDENCE MINING COMPANY INC.
By: /s/ Robert W. Micsak
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Name: Robert W. Micsak
Title: Vice President
ATLAS CORPORATION
By: /s/ Gerald E. Davis
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Name: Gary E. Davis
Title: President