1
EXHIBIT 99.2
AGREEMENT
THIS AGREEMENT is entered into as of October 23, 1995, by and between
SUNSHINE MINING AND REFINING COMPANY (the "Company"), whose address is 877 W.
Main St., Suite 600, Boise, Idaho 83702, and GRACE HOLDINGS, L.P., whose
address is 1000 West Diversy Parkway, Suite 233, Chicago, Illinois 60614
("Grace"), who is the beneficial owner of 844,200 shares of $11.94 (Stated
Value) Preferred Stock of the Company (the "Preferred Stock").
For good and valuable consideration, the parties hereto, intending to
be legally bound, agree as follows:
1. Grace hereby covenants and agrees to vote all of the shares of
Preferred Stock beneficially held by it FOR the merger proposal (the "Merger
Proposal") in accordance with the term sheet attached herewith and incorporated
herein by reference, at a special meeting of shareholders of the Company, and
any adjournment thereof, at which the Merger Proposal may be presented for the
approval of shareholders.
2. Grace hereby agrees that, upon consummation of the merger (the
"Merger") as contemplated in the Merger Proposal, it will dismiss with
prejudice its litigation currently pending against the Company in The United
States District Court for the District of Delaware, identified as Case No. CA
95-38, each party bearing its own costs and attorney fees.
3. Grace agrees that it will not join nor participate as a party
in that certain litigation commenced against the Company by Harbor Finance
Partners, a Colorado partnership, and currently pending in Delaware Chancery
Court, New Castle County, identified as Case No. CA 14159, nor in any similar
litigation.
4. This Agreement, and all obligations hereunder, including
without limitation paragraph 3, shall expire upon the earlier of (i) the 120th
day after the date hereof, provided that the Merger has not occurred, or (ii)
the date, if any, upon which the Merger Proposal is either withdrawn or
materially modified by the Company.
5. This Agreement, shall be binding upon the parties' successors
and assigns. This Agreement shall be interpreted pursuant to the laws of the
State of Delaware.
6. By executing this Agreement the undersigned each represent and
warrant that it has been duly authorized to execute this Agreement and to be
bound thereby.
2
GRACE HOLDINGS, L.P.
DATED: October 23, 1995 By: BRADFORD T. WHITMORE
---------------- ----------------------------
Bradford T. Whitmore
SUNSHINE MINING AND REFINING COMPANY
By: WILLIAM W. DAVIS
---------------------------
William W. Davis, Senior
Vice-President and Chief
Financial Officer
3
PREFERRED STOCK
PROPOSED TRANSACTION
Merge SSC into special purpose sub, with each Preferred share replaced by (a)
Sunshine Common Stock issuable pursuant to the formula described below, and (b)
.9 share of common stock or, at the option of the holder, 2 Warrants as
described below:
SUNSHINE COMMON STOCK
The number of shares of Common stock will
be that number of shares determined by
dividing the closing price on Sunshine
Common stock on the latest date practical
prior to mailing the prospectus into
$10.50 (at a 1 7/8 Common stock price, 5.6
shares).
If the average closing price of the Common
stock on the NYSE for the first 120
trading days after the Effective Date of
the Merger is less than the initial price
used to determine the number of shares
issuable, additional Common shares will be
issued as soon as practical after the end
of the 120-trading day period. The
additional number of shares issuable will
be determined by the following formula,
where:
X = Average Common stock closing price on
the NYSE for first 120 trading days
after issuance, and
Y = Average Common shares initially
issuable per Preferred share
$10.50 - Y. In no event will the total of
------ initial shares
X
issuable, plus additional shares issuable,
exceed 8.4.
WARRANTS
Shares purchasable 1
Exercise Price 110% of the Common stock closing price on
the latest date practical prior to mailing
the prospectus; resettable to 110% of
average closing price of the Common stock
on the NYSE for the first 120 trading days
after the Effective Date of the Merger, if
such price is less than the initial price.
Expiration 5 years from issuance