exv10w1xcy



 






	 	 	 	 	 



Exhibit 10.1(c)




AGREEMENT




THIS AGREEMENT (“Agreement”) is made and entered into effective as of October
13, 2004, by and between REVETT SILVER COMPANY, a Montana corporation
(“Revett”), and ROYAL GOLD, INC., a Delaware corporation (“Royal Gold”).




Recitals





	 	A.	 	Revett, through one or more of its wholly-owned subsidiaries,
including but not limited to RC Resources, Inc., a Montana corporation
(“RC Resources”, which, together with any other Revett subsidiaries
that now or hereafter own interests in the Properties [defined below],
shall be described herein collectively as the “Subsidiaries” and
individually as a “Subsidiary”), owns certain mining properties in
Sanders County, Montana, as described more specifically in Exhibit A
hereto (collectively, the “Properties”).
	 
	 	B.	 	Revett and another of its wholly-owned subsidiaries, Genesis Inc.
(“Genesis”), are parties to a certain Promissory Note (the “Note”) in
the principal amount of $5,000,000, dated February 21, 2000, as amended
by Third Amendment dated February 1, 2003 (the “Third Amendment”), from
Genesis and Revett (previously known as Sterling Mining Company),
collectively as “Maker”, to Kennecott Montana Company (“Kennecott”,
with Kennecott and any subsequent holder of the Note referred to herein
and in the Note as “Payee”), as “Lender”.
	 
	 	C.	 	The Note is secured by a Mortgage, Security Agreement and Financing
Statement, dated February 21, 2000 (the “Mortgage”), from Genesis, as
“Mortgagor” and as predecessor to the Subsidiaries as owner of the
Properties. The Mortgage encumbers certain of the Properties and
certain other properties of Genesis.
	 
	 	D.	 	Royal Gold wishes to purchase from Revett, and Revett wishes to
sell to Royal Gold, certain shares of Revett common stock, with the
right and option of Royal Gold to convert those shares into a royalty
on the Properties, as provided in this Agreement.
	 
	 	E.	 	Royal Gold wishes to receive from Revett, and Revett wishes to
grant to Royal Gold, the exclusive right and option, but not the
obligation, to cure any defaults by Revett, Genesis or the Subsidiaries
under the Note or Mortgage and, in the event that the Payee commences
any foreclosure proceeding pursuant to the Mortgage, to assume the
Payee’s position under the Note and Mortgage or, alternatively, to
enter into a replacement promissory note and security instrument, as
provided herein.





NOW, THEREFORE, in consideration of the mutual benefits to be derived by the
parties hereto pursuant to this Agreement, Revett and Royal Gold hereby agree
as follows:




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ARTICLE I

AGREEMENT TO SELL AND PURCHASE SHARES; CONVERSION RIGHT





	1.1	 	Agreement to Sell and Purchase Shares. On or before October 15, 2004 (the
“Closing Date”), Royal Gold shall purchase from Revett, and Revett shall
issue and sell to Royal Gold, 1,333,333 shares of previously unissued
common stock of Revett (the “Shares”), for a Purchase Price of One Million
United States Dollars (US$1,000,000) (the “Closing”). At the Closing,
Revett shall deliver to Royal Gold a certificate or certificates
registered in the name of Royal Gold representing the Shares, and Royal
Gold shall pay the Purchase Price to Revett by wire transfer to Revett’s
account at a bank designated by Revett.
	 
	1.2	 	Option to Convert Shares to NSR Royalty. Royal Gold shall have the right
to convert (“Conversion Right”) the Shares to a perpetual,
non-participating one percent (1%) net smelter return (“NSR”) royalty, as
described in Exhibit B hereto (the “Royalty”), on the Properties and other
lands, if any, owned or acquired by Revett or the Subsidiaries within the
Area of Interest described in Exhibit C hereto, at any time during the
period from the Closing Date until sixty (60) days after the later of: (i)
Royal Gold having been presented with a positive bankable feasibility
study (i.e., a study that is in a form and of a scope generally acceptable
to reputable financial institutions that provide financing to the mining
industry) with respect to the Properties; or (ii) Revett’s Board of
Directors having approved commencement of construction of a mine (the
“Mine”) on those Properties. The following conditions and limitations
shall apply to the Conversion Right and the Royalty:






	 	(a)	 	The Conversion Right shall be personal to Royal Gold. If Royal
Gold transfers the Shares to another party, the Conversion Right shall
terminate.

	 
	 	(b)	 	The Royalty shall be subordinate to security interests that secure
initial third party financing of the construction of the Mine, if and
to the extent that the party providing that financing requires such
subordination. This subordination to which the Royalty may be subjected
shall not prohibit or limit payments due under the Royalty unless and
until a default under the financing agreement occurs and is declared by
the financing party. In the absence of such default and declaration,
payments due under the Royalty shall have priority over any cash sweep
or cash reserve requirements under the financing agreement.






	1.3	 	Royal Gold Opportunity to Present Financing Proposal and Right of First
Refusal to Provide Financing. At such time, if any, that either Revett or
any Subsidiary receives and wishes to accept a reasonably detailed term
sheet or other form of proposal for financing of construction of the Mine,
the party receiving the proposal shall give Royal Gold a copy of that
proposal, and Royal Gold shall have twenty (20) business days thereafter
in which to present to Revett a competing proposal for such financing.
Further, if at any time either Revett or any Subsidiary receives and
wishes to accept a reasonably detailed term sheet or other form of
proposal involving either: (i) a royalty, production payment or other
similar transaction that is calculated on the basis




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	 	 	of a percentage of production or revenues from the Mine, or (ii) royalty
financing for the construction of the Mine; it shall provide Royal Gold with
a copy of that proposal, and Royal Gold shall have a right of first refusal
to provide financing on terms as or more favorable than those contained in
the proposal. That right shall be exercisable by Royal Gold for a period of
twenty (20) business days after its receipt of the copy of the proposal. If
Royal Gold declines either to present a financing proposal or to exercise
its right of first refusal, as the case may be, Revett and the Subsidiaries
shall have the right for a period of ninety (90) days after that declination
to close the transaction but only if the final terms of the transaction to
be closed are not materially different from the terms of the proposal
presented to Royal Gold. If the transaction is not closed within that ninety
(90) day period, or if the terms of the transaction to be closed are
materially different from those presented to Royal Gold, then Royal Gold’s
rights under this Section 1.3 shall be reinstated .
	 
	1.4	 	Royal Gold Option to Cure Defaults under the Note or Mortgage. Revett
hereby agrees that if it, Genesis or any of the Subsidiaries receive a
notice from the Payee that requests an interest payment under the Note, as
provided in the Third Amendment, Revett shall so inform Royal Gold in
writing and provide Royal Gold with a copy of that notice within two (2)
business days after Revett’s, Genesis’ or a Subsidiary’s receipt,
whichever is earliest, of same. Revett shall exercise its best efforts to
make or cause Genesis or a Subsidiary to make payment of that interest
payment on or before two (2) days prior to its due date. If they fail to
do so, Revett shall so notify Royal Gold in writing on or before that
interest payment due date, in which event Royal Gold shall have the
exclusive right and option, but not the obligation, to make such payment.
If Revett, Genesis or any of the Subsidiaries default under any of their
other obligations under the Note, or if Genesis or a Subsidiary defaults
under any of their obligations under the Mortgage, and any of them
receives a notice of default from the Payee pursuant to either the Note or
Mortgage, Revett shall so inform Royal Gold in writing and provide Royal
Gold with a copy of the default notice after its, Genesis’ or the
Subsidiary’s receipt of same. Revett then shall exercise its best efforts
to cure the default or cause Genesis or a Subsidiary to cure the default
within twenty (20) days after receipt of the default notice. If the
default is not cured within that time period, or if Revett determines that
none of them will be able to cure the default within that time period,
Revett shall so notify Royal Gold by telephone, facsimile and e-mail on or
before the first business day after the twentieth (20th) day, after which
Royal Gold shall have the exclusive right and option, but not the
obligation, to cure the default cited by the Payee in its notice of
default.
	 
	1.5	 	Royal Gold’s Options in the Event of Foreclosure under the Mortgage. If
the Payee initiates a foreclosure proceeding pursuant to the Mortgage,
Royal Gold shall have the exclusive right and option, but not the
obligation, to enter into a transaction with the Payee pursuant to which
Royal Gold would assume the position of the Payee under the Note and
Mortgage. If for any reason Royal Gold is unable to obtain the Payee’s
agreement to Royal Gold’s assumption of Payee’s position, Revett agrees
that Royal Gold shall have the exclusive right and option, but not the
obligation, to




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	 	 	 pay off the remaining balance due under the Note, in which event Revett shall
execute and shall cause Genesis and/or the appropriate Subsidiary or
Subsidiaries to execute a replacement promissory note for the same principal
amount and with the same other provisions as the Note, except as provided
below in this Section 1.5. Revett also shall cause the appropriate
Subsidiary or Subsidiaries to execute a replacement security instrument that
contains the same terms and conditions and encumbers the same properties and
interests as the Mortgage, with the exception that the replacement security
interest shall reflect the revised terms of the replacement note as
described below in this Section 1.5. The Note and Mortgage assumed from
Payeee by Royal Gold or, in the alternative, the replacement note and
security instrument described above, shall be subject to the following
further provisions:






	 	(a)	 	Royal Gold will extend the current Term of the Note through
February 21, 2010, but the Note otherwise shall remain unchanged; and

	 
	 	(b)	 	 For the remaining Term of the Note, Royal Gold shall have the right
to convert all principal and interest due under the Note into either:






	 	(i)	 	a perpetual, non-participating three percent (3%) NSR
royalty, as defined in Exhibit B hereto, in the Properties and
any other lands within the Area of Interest owned or acquired by
Revett, Genesis or any of the Subsidiaries within the Area of
Interest described in Exhibit C hereto; or

	 
	 	(ii)	 	previously unissued common stock of Revett, at a
conversion rate of US$0.75 per share for all unpaid principal
and interest under the Note or replacement note, as applicable,
at the time of conversion.






	1.6	 	Maintenance of Title to Properties and Title Information; Recordable
Instrument. Revett hereby agrees to maintain the unpatented mining claims
within the Properties in good standing and to timely pay all property
taxes applicable to the patented mining claims within the Properties.
Revett promptly shall provide to Royal Gold, upon written request from
Royal Gold, copies of all title information in Revett’s possession and
control regarding the Properties. Revett further agrees to cause Genesis
and/or one or more of the Subsidiaries to execute a recordable instrument
in a form reasonably acceptable to Royal Gold, so as to provide
constructive notice of Royal Gold’s rights under this Agreement to receive
the NSR royalties in the Mine, as described in Sections 1.2 and 1.5 above.
	 
	1.7	 	Royal Gold Piggy-Back Registration and Anti-Dilution Rights with Respect
to Revett Stock. Revett agrees that at such time as it files a
registration statement with either United States or Canadian securities
regulators for a public offering of its common stock, it will include in
such registration the Shares purchased by Royal Gold pursuant to Section
1.1 above, plus all shares of Revett common stock, if any, that have been
acquired by Royal Gold pursuant to Section 1.5(b)(ii) above. Revett also
agrees to provide Royal Gold with the right and option, but not the
obligation, to purchase additional shares of Revett common stock if Revett
sells additional stock (either in a private placement or public offering)
at a price of less than US$0.75 per share. In such case, the price to
Royal Gold shall be equal to the sale price for which




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	 	 	such shares were sold; and the number of shares that Royal Gold shall be
entitled to purchase at that price shall be a number that will maintain
Royal Gold’s percentage ownership of Revett’s issued and outstanding shares
at the same percentage level as it was immediately prior to the sale of the
Revett shares at less than US$0.75 per share.
	 
	1.8	 	Confidentiality and Press Releases. Neither party shall, without the
prior written consent of the other party, disclose to any third party
(excluding, however, any representative, affiliate, agent, consultant or
contractor of the disclosing party who has a bona fide need to be
informed) any information or data concerning operations, including but not
limited to exploration, on the Properties that is not generally available
to the public; provided, however, that upon not less than five (5) days’
prior written notice to the other party setting forth the nature and
content of a proposed disclosure, the disclosing party may disclose
information or data pertaining to the Properties: (a) to any third party
to whom the disclosing party in good faith anticipates selling all or part
of its interest hereunder, or (b) to any lender or underwriter from whom
the disclosing party is borrowing or raising funds secured by or based
upon the Properties, provided that such lender or underwriter executes a
confidentiality agreement in a form that is reasonably acceptable to the
non-disclosing party. If a disclosure is, in the good faith judgment of a
party, required for compliance with applicable laws, rules, regulation or
orders of any governmental agency or stock exchange having jurisdiction
over the disclosing party, that party shall provide as much prior notice
to the other party of the nature and contents of the proposed disclosure,
for the review and comment of the non-disclosing party, as is reasonably
possible in the circumstances.





WHEREFORE, the parties have executed this Agreement to be effective as of the
date first above written.




ROYAL GOLD, INC.




	 	 	 
	By:

	 	/s/ Tony A. Jensen
	

	 	








REVETT SILVER COMPANY




	 	 	 
	By:

	 	/s/ William Orchow
	

	 	









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