Exhibit 10.1
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THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES
LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS
FROM THE REGISTRATION REQUIREMENT OF THE ACT AND SUCH LAWS. THE SECURITIES
OFFERED HEREBY HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY
AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE
MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL. NO
OFFER OR SALE OF THE SECURITIES OFFERED HEREBY MAY BE MADE IN THE UNITED STATES
OR TO OR FOR THE ACCOUNT OR BENEFIT OF A "U.S. PERSON" AS THAT TERM IS DEFINED
IN REGULATION S OF THE SECURITIES ACT, DURING ANY APPLICABLE RESTRICTED PERIOD,
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT,
OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION.
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STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT ("Agreement") is made as of 23rd February,
1998, by and between CROWN RESOURCES CORPORATION, a Washington corporation
("Seller"), and The Equitable Life Assurance Society, ("Purchaser").
RECITALS
A. Seller desires to sell to Purchaser, and Purchaser desires to purchase
from Seller, shares of the common stock, par value $.01 per share, of Seller
(the "Common Stock"), pursuant to the terms and conditions of this Agreement and
in reliance on Regulation S ("Regulation S") promulgated under the United States
Securities Act of 1933, as amended (the "Securities Act"), which sets forth
certain conditions under which the offer and sale of securities shall be deemed
to be made outside the United States.
B. The shares subject to this Agreement have not been registered under
the Securities Act or under the state securities laws of any state of the United
States.
AGREEMENT
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NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement and other good and valuable consideration the receipt
and adequacy of which the parties acknowledge, the parties agree as follows:
ARTICLE 1
PURCHASE AND SALE
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1.1 Purchase of Common Stock. On the term and subject to the conditions
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contained in this Agreement, Seller shall sell and deliver to Purchaser, and
Purchaser shall purchase from Seller, 1,000,000, shares of Common Stock (the
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"Shares").
1.2 Purchase Price. Purchaser shall pay to Seller a per share purchase
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price of U.S. $ 4,625 for a total purchase price of U.S. $4,625,000 for the
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Shares (the "Purchase Price"). Purchaser shall pay Seller the Purchase Price by
wire transfer in United States funds at Closing to:
ACCOUNT NAME: Crown Resources
Corporation
BANK: Norwest Bank Of Denver
BRANCH: Denver, CO, USA
Denver, CO 80202, USA
ABA ROUTING #: 1020-007-6
ACCOUNT#: 1010857596
CONTACT:
1.3 Closing. The closing of the transaction contemplated by this Agreement
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(the "Closing") shall be held on such date and at such time on or before
February 27, 1998, as the parties may agree, unless such date is extended by
agreement of the parties (the "Closing Date"). On the Closing Date, Seller will
cause its transfer agent to prepare a certificate or certificates representing
the Shares, which certificate(s) shall be delivered to Purchaser at an address
identified by Purchaser.
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ARTICLE 2
REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER
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To induce Purchaser's execution of this Agreement and consummation of the
transactions contemplated hereby, Seller represents, warrants and covenants as
follows:
2.1 Corporate Organization; Authorization. Seller is duly incorporated,
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validly existing and in good standing as a corporation under the laws of the
State of Washington and has full corporate power and authority to enter into
this Agreement and to issue and sell the Shares. This Agreement has been duly
authorized, executed and delivered by Seller and constitutes a valid and binding
agreement of Seller enforceable in accordance with its terms.
2.2 Capital Stock. Seller has authorized capital stock consisting of
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50,000,000 shares of Common Stock and 20,000,000 shares of preferred stock, par
value $.01 per share (the "Preferred Stock"). As of February 11, 1998, Seller
had outstanding 13,455,725 shares of Common Stock and no shares of Preferred
Stock.
2.3 Reporting Compliance. Seller's Common Stock is registered pursuant
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to Section 12 of the United States Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and Seller has filed all materials required to be filed
pursuant to Section 13(a) or 15(d) of the Exchange Act for a period of at least
12 months immediately preceding the date of this Agreement.
2.4 Information. Seller has delivered to Purchaser copies of Seller's
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Report on Form 10-K for the year ended December 31, 1996 (the "Form 10-K") and
Seller's Quarterly Reports on Form 10-Q for the quarters ended March 31, 1997,
June 30, 1997 and September 30, 1997 (the "Disclosure Materials"). The
information concerning Seller set forth in the Disclosure Materials is, as of
the dates thereof, complete and accurate in all material respects and, to the
best of Seller's knowledge, does not contain any untrue statement of a material
fact or omit to state a material fact required to make the statements therein,
in light of the circumstances under which they were made, not misleading. Upon
request, Seller shall provide to Purchaser any additional reports filed by it
with the United States Securities and Exchange Commission after the date of this
Agreement but prior to the Closing Date.
2.5 Characteristics of the Shares. The Shares, when issued and
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delivered to Purchaser, will be duly and validly authorized and issued, fully
paid and nonassessable and free from preemptive rights.
ARTICLE 3
REPRESENTATIONS, WARRANTIES AND COVENANTS OF PURCHASER
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As an inducement to, and with the intent that Seller rely on the accuracy
thereof, Purchaser represents, warrants and covenants as follows:
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3.1 Organization. Purchaser is [insert appropriate language re due
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organization and valid existence of Purchaser under the laws of the jurisdiction
of its organization]. Purchaser has the requisite power and is duly authorized
under all applicable laws and regulations to acquire the Shares. The execution
and delivery of this Agreement will not violate any provision of Purchaser's
governing charter or any other contractual or legal obligation of Purchaser.
3.2 Approval of Agreement. Purchaser has taken all action required by
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applicable law, its governing charter or otherwise to authorize the execution
and delivery of this Agreement and the consummation of the transactions hereby.
This Agreement is a legal, valid and binding obligation of Purchaser,
enforceable in accordance with its terms. Purchaser is not required to obtain
the authorization, approval, consent or order of, or make a registration or
filing with, any court or other regulatory or governmental body in connection
with the execution and delivery by Purchaser of this Agreement and the
consummation by Purchaser of the transactions contemplated hereby. The execution
of this Agreement and the consummation of the transactions hereby will not
result in the breach of any term or provision of, constitute an event of default
under or require the consent or approval of any third-party pursuant to any
material contract, agreement or instrument to which Purchaser is a party or by
which any of its properties or assets are bound.
3.3 Information. The information concerning Purchaser provided to
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Seller in connection with this Agreement is complete and accurate in all
material respects and does not contain any untrue statement of a material act or
omit to state a material fact required to make the statements therein, in
light of the circumstances under which they were made, not misleading.
3.4 Risk Factors. Purchaser has been informed and fully understands
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that there are significant risks associated with a purchase of the Shares,
including, without limitation, the risks and considerations described in Item 1
of Seller's Form 10-K, which factors Purchaser has considered carefully before
executing this Agreement.
3.5 Purchaser's Financial Condition. Purchaser is an accredited
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investor as that term is defined in Regulation D promulgated under the
Securities Act. Purchaser is capable of bearing the economic risk and burden
of this investment, including, without limitation, the possibility of a complete
loss of its investment in the Shares. Purchaser understands that there are
substantial restrictions on the transferability of the Shares, which may make
the liquidation of the Shares impossible for the immediate future.
3.6 Disclosure. Purchaser has received copies of the Disclosure
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Materials. All documents requested by Purchaser have been made available for
inspection and copying. Purchaser has been supplied with all additional
information concerning Seller and the Shares that Purchaser has requested.
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3.7 No Registration. Purchaser acknowledges that the Shares are being
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issued without being registered under the Securities Act or other applicable
securities laws under exemptions from such registration requirements. Purchaser
acknowledges that it must therefore hold the Shares for the applicable holding
period unless the Shares are subsequently registered under the Securities Act
and applicable state securities laws or an exemption from such registration is
available, and that Seller will place stop transfer instructions with Seller's
transfer agent regarding the Shares. Seller is under no obligation to register
the Shares or take any other action which would make an exemption from
registraton available, and Seller is under no obligation to cause or permit the
Shares to be transferred in the absence of such registration or an opinion
satisfactory to Seller's counsel that an exemption is available.
3.8 Regulation S. Purchaser is not a "U.S. Person" as that term is
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defined under Rule 902(o)(1) promulgated under the Securities Act. "U.S. Person"
means:
1. any natural person resident in the United States;
2. any partnership or corporation organized or incorporated under
the laws of the United States;
3. any estate of which any executor or administrator is a U.S.
person;
4. any trust of which any trustee in a U.S. person;
5. any agency or branch of a foreign entity located in the United
States;
6. any non-discretionary account or similar account (other than
an estate or trust) held by a dealer or other fiduciary for
the benefit or account of a U.S. person;
7. any discretionary account or similar account (other than an
estate or trust) held by a deal or other fiduciary organized,
incorporated or (if an individual) resident in the United
States; and
8. any partnership or corporation if:
(a) organized or incorporated under the laws of any foreign
jurisdiction; and
(b) formed by a U.S. person principally for the purpose of
investing in securities not registered under the
Securities Act, unless it is organized or incorporated
and owned by accredited investors (as defined in rule
501(a) under the Securities Act) who are not natural
persons, estates or trusts.
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Purchaser maintains its principal residence outside the United States. Purchaser
agrees not to offer or sell the Shares to any U.S. Person or for the account or
benefit of any U.S. Person for a period of 40 days (the "Restricted Period")
after the Closing Date. Purchaser will have in place, throughout the Restricted
Period, procedures designed to ensure that Purchaser is, and its employees or
agents who are directly engaged in selling securities are, aware that the Shares
may not be offered or sold into the United States, or to or for the account or
benefit of any U.S. Person, during the Restricted Period. Neither Purchaser nor
any of its affiliates, nor any person acting on its behalf, has engaged or will
engage in any "directed selling efforts," as defined in Regulation S, with
respect to the Shares. Purchaser is not a "distributor," as defined in
Regulation S. Purchaser has not entered into and will not enter into any
contractual arrangement with any distributor with respect to the distribution of
the Shares. Purchaser agrees that all resales by Purchaser of the Shares in the
United States or to U.S. Persons will be made only in accordance with Regulation
S, the Securities Act or pursuant to an available exemption from registration
and in any event not before expiration of the Restricted Period.
3.9 Exclusive Reliance on this Agreement; No Oral Representations. In
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making the decision to purchase the Shares, Purchaser has relied exclusively
upon information provided to it in connection with this Agreement and any
investigations made by Purchaser. Purchaser confirms that it is not relying upon
any oral representations, or statements made by Seller or by any other person in
purchasing the Shares.
3.10 Legend. Purchaser acknowledges that the certificates representing
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the Shares will bear substantially the following legend until such legend may be
removed under applicable securities laws:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY STATE AND WERE
OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF
THE ACT AND SUCH LAWS. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER
REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR
ENDORSED THE MERITS OF THESE SECURITIES. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL. NO OFFER OR SALE OF THE SECURITIES OFFERED HEREBY MAY BE MADE IN THE
UNITED STATES OR TO OR FOR THE ACCOUNT OR BENEFIT OF A "U.S. PERSON," AS THAT
TERM IS DEFINED IN REGULATION S OF THE SECURITIES ACT, DURING ANY APPLICABLE
RESTRICTED PERIOD, IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION.
3.11 Further Actions. Purchaser shall execute and deliver to Seller, at or
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prior to the Closing, such further letters of representation, acknowledgment,
suitability or the like, as Seller and its counsel may reasonably request in
connection with Seller's reliance on exemptions from registration under
Regulation S or any other securities laws.
3.12 No Other Assurances. Seller and Purchaser acknowledge that the basis
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for relying on exemptions from registration or qualification are factual and
depend on the conduct
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of the various parties and that no legal opinion or other assurance will be
required or given to the effect that the transactions contemplated hereby are in
fact exempt from registration or qualification.
ARTICLE 4
INDEMNIFICATION
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4.1 Indemnification by Purchaser. Purchaser will indemnify and hold
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harmless Seller and its directors, officers, agents and employees, and each
person, if any, who controls Sellers within the meaning of the Securities Act
"Affiliates"), from and against any and all claims, damages, expenses,
liabilities or actions ("Claims") to which any of them may become subject under
applicable law (including the Securities Act and the Exchange Act) and will
reimburse them for any legal or other expenses reasonably incurred by them in
connection with the investigation or defense of any Claims arising out of or
based upon a misrepresentation or alleged misrepresentation of material fact
contained in any application or statement filed with a governmental body by
Seller or the omission or alleged omission of a material fact required to be
stated therein, or necessary in order to make the statements made therein not
misleading, but only insofar as any such misrepresentation or omission was made
in reliance upon and in conformity with information furnished in writing by
Purchaser. Purchaser agrees at any time upon the request of Seller to furnish a
written letter or statement confirming the accuracy of any information provided
to Seller by Purchaser. This Section 4.1 shall remain operative and in full
force and effect, regardless of any investigation made by or on behalf of
Seller, and shall survive the consummation of the transactions by this
Agreement.
4.2 Indemnification by Seller. Seller will indemnify and hold harmless
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Purchaser and its Affiliates, from and against any Claim to which any of them
may become subject under applicable law (including the Securities Act and the
Exchange Act) and will reimburse them for any legal or other expenses reasonably
incurred by them in connection with the investigation or defense of any Claims
arising out of or based upon any untrue statement or alleged untrue statement of
a material fact contained in the Disclosure Materials, or arising out of or
based upon the omission or alleged omission of a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading. This Section 4.2 shall remain operative and in full force and
effect, regardless of any investigation made by or on behalf of Purchaser, and
shall survive the consummation of the transactions contemplated by this
Agreement.
ARTICLE 5
CONDITIONS PRECEDENT TO OBLIGATIONS
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The obligations of each party to this Agreement are subject to the
satisfaction, at or before the Closing Date, of the following conditions:
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5.1 Accuracy of Representations. The representations and warranties made
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by each party in this Agreement shall have been true when made and shall be true
at the Closing Date with the same force and effect as if such representations
and warranties were made at and as of the Closing Date (except for changes
therein permitted by this Agreement), and such party shall have performed or
complied with all covenants and conditions required by this Agreement to be
performed or complied with by such party prior to or at the Closing.
5.2 Other Items. Each party shall have received such further documents,
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certificates or instruments relating to the transactions contemplated hereby as
the other party may reasonably request
ARTICLE 6
GENERAL PROVISIONS
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6.1 Amendment or Waiver. Every right and remedy provided in this
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Agreement shall be cumulative with every other right and remedy, whether
conferred in this Agreement, at law or in equity, and may be enforced
concurrently with any right conferred by this Agreement, and no waiver by any
party of the performance of any obligation by the other shall be construed as a
waiver of the same or any other default then, theretofore or thereafter
occurring or existing. At any time prior to the Closing Date, this Agreement may
be amended by a writing signed by the parties with respect to any of the terms
contained in this Agreement, and any term or condition of this Agreement may be
waived or the time for performance thereof may be extended by a writing signed
by the party or parties for whose benefit the provision is intended.
6.2 Attorneys' Fees. In the event any party institutes and prevails in
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any action or suit to enforce this Agreement or to secure relief from any
default under or breach of this Agreement, the defaulting or breaching party, or
parties shall reimburse the nonbreaching party or parties for all costs,
including, without limitation, reasonable attorneys' fees incurred in connection
with such dispute and in enforcing or collecting any judgment rendered pursuant
to such dispute.
6.3 Governing Law. This Agreement shall in all respects, including all
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matters of construction, validity and be governed by and construed and enforced
in accordance with the laws the State of Washington, without reference to any
rules governing conflicts of laws.
6.4 No Brokers. Purchaser and Seller agree that no third person[, except
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for David Williamson and Associates (DWA)] has in any way brought the parties
together or been instrumental in the negotiation, execution or consummation of
this Agreement. Purchaser and Seller each agree to indemnify the other against
any claim by any third person[, other than DWA,] for any commission, brokerage,
finders fee or other payment with respect to this Agreement or the transactions
contemplated hereby based upon any alleged agreement or understanding
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between such party and such third person, whether expressed or implied, arising
from the actions of such party. The covenants set forth in this Section 6.4
shall survive the Closing Date and the of the transactions contemplated hereby.
6.5 No Public Announcement. Neither of the parties to this Agreement
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shall, without the approval of the other party, make any press release or other
public concerning the transactions contemplated by this Agreement unless that
party has first provided a copy of such press release or public announcement to
the other party at least two days prior to release. However, nothing contained
in this Agreement shall prohibit any party from making any public disclosure or
announcement which is required by law or shall prohibit Seller from making a
public announcement on or after the Closing Date with respect to the completion
of the offering.
6.6 Notices. All notices, demands, requests or other communications
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required or authorized under this Agreement shall be deemed given sufficiently
if in writing and if personally delivered; if sent by facsimile transmission,
confirmed with a written copy thereof sent by overnight express delivery; if
sent by registered mail or certified mail, return receipt requested and postage
prepaid; or if sent by overnight express delivery:
If to Seller, to: CROWN RESOURCES CORPORATION
Attention: Christopher E. Herald, President
1675 Broadway
Suite 2400
Denver, Colorado 80202
Facsimile: (303) 534-1809
Telephone: (303) 534-1030
If to Purchaser. To the address, telephone or facsimile numbers set
forth on the signature page
or such other addresses and facsimile numbers as shall be furnished in writing
by any party in the manner for giving notices hereunder. Any such notice,
demand, request or other communication shall be deemed to have been given as of
the date personally delivered or on the first business day after a legible copy
sent by facsimile transmission is received, three days after the date mailed by
registered or certified mail, or on the first business day after the date sent
by overnight delivery.
6.7 Survival; Liability. The representations, warranties and covenants
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of the respective parties set forth in this Agreement shall survive the Closing
the transactions contemplated by this Agreement for a period of one year from
the date of this Agreement. Seller's cumulative liability to Purchaser for
breaches of this Agreement shall not exceed the Purchase Price.
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6.8 Third-Party Beneficiaries. This Agreement is solely between Seller and
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Purchaser, and no director, officer, stockholder, employee, agent, independent
contractor or any other person or entity shall be deemed to be a third-party
beneficiary of this Agreement.
6.9 Counterparts. This Agreement may be executed in multiple counterparts,
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each of which shall be deemed an original and all of which taken together shall
be a single instrument.
6.10 Entire Agreement. This Agreement, together with the documents to be
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delivered pursuant to this Agreement, represents the entire agreement between
the parties relating to the subject matter of this Agreement. There are no other
understandings, agreements, representations or warranties, written or oral, with
respect to the subject matter hereof except as set forth herein.
Executed as of the date first set forth above.
SELLER
CROWN RESOURCES CORPORATION
By: /s/ Christopher E. Herald
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Christopher E. Herald
President
PURCHASER:
THE EQUITABLE LIFE ASSURANCE SOCIETY
By: [SIGNATURE ILLEGIBLE]
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Its:
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Purchaser's Address:
THE EQUITABLE LIFE ASSURANCE SOCIETY
CITY PLACE HOUSE, 55, BASINGHALL STREET
LONDON EC2V 5DR
Attention: Jonathan Dennis
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Facsimile Transmission: 0171 710 3867
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Telephone: 0171 710 3744
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Exact Name(s) for Certificate:
BOOTH & CO
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Address for Certificate Delivery:
40 BROAD STREET
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8TH FLOOR
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NEW YORK
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NY 10004
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