Document:

(*) Designates portion of this document that has been omitted pursuant to a request for confidential treatment filed separately with the Commission.

     

        BINDING OFFER LETTER

         

        August 6, 2009 

         

        Mr. Steve Akerfeldt

        Chief Executive Officer

        Firstgold Corp. 

        1055 Cornell Avenue

        Lovelock, Nevada

        89419

         

        
            	
                        Re:

                    	
                        Firstgold Corp: Proposed US$15 Million Restructuring Comprised of a US$5.5 Million Indebtedness Purchase and US$9.5 Million Equity Investment 

                    

        

         

        Dear Gentlemen:

         

                  We are pleased to submit this binding offer letter (this “Offer”), which outlines the terms and conditions pursuant to which Northwest Non-Ferrous International Investment Company Limited (“Northwest”), whether directly or via a wholly-owned subsidiary or affiliate of Northwest, is
        prepared to enter into a definitive indebtedness purchase agreement (the “Indebtedness Purchase Agreement”) pursuant to which it will advance US$5.5 million (the “Purchase of Indebtedness”) to Firstgold Corp. (“Firstgold”) for it to repay certain indebtedness subject to the terms and conditions described below, and will enter into a subscription agreement (the “Subscription Agreement”) to purchase that number of
        common shares (the "Shares") of Firstgold (the “Subscription”) equal to 51% of the issued and outstanding Shares following completion of the Subscription, for cash of US$9.5 million upon the terms set forth herein. Concurrent with the acceptance of this Offer, Northwest will enter into an agreement (a "Note Purchase Agreement") with each of Platinum Long Term Growth, LLC and Lakewood Group LLC (collectively, the "Current Creditors") to acquire the
        Notes (as defined in the Note and Warrant Purchase Agreement dated August 7, 2008 between Firstgold and the Current Creditors (the "Note and Warrant Purchase Agreement")) for a purchase price 

         

        

        

        

        of US$11.5 million. The Indebtedness Purchase Agreement, the Subscription Agreement and the agreements with each of the Current Creditors are, collectively, referred to herein as the “Restructuring”.

         

                  This Offer is intended to be binding; however, this Offer is not intended to set forth all of the terms of the Restructuring and the ancillary documents contemplated herein or thereby, which documents will contain additional terms agreed to by the respective parties and their legal counsel.

        1.          Purchase of Indebtedness. Northwest will purchase the indebtedness of Firstgold in the sum of US$5.5 million on or about August 31, 2009, to be secured by a fixed and floating first lien and mortgage against all of the assets and undertaking of Firstgold and its subsidiary corporation. The purchase price will
        be used by Firstgold to repay certain indebtedness.. The purchase price paid by Northwest shall bear interest at a fixed rate of 10 per cent per annum, calculated and payable monthly in arrears. The principal amount of the purchase price shall be payable in 24 equal monthly installments commencing on September 1, 2010. .

        2.          Subscription. On or about September 30, 2009, and subject to shareholder approval and regulatory approval, Northwest will subscribe for that number of Shares from authorized but unissued Shares as is necessary to equal 51% of the issued and outstanding Shares (after giving effect to such issuance) for cash in
        the amount of US$9.5 million. Firstgold acknowledges that failure of the Subscription to close on or before September 30, 2009 shall constitute a default under the Indebtedness Purchase Agreement entitling Northwest to immediately accelerate repayment of all principal and unpaid interest thereon.

        3.          Pre-Loan Funding . The parties confirm that on July 17, 2009, Northwest transferred to Stikeman Keeley Spiegel Pasternack LLP, Toronto, Canada, Barristers and Solicitors and counsel to Firstgold, as escrow agent (via wire transfer to TD Canada Trust, TD Centre Branch, 55 King Street West, Toronto,
        Canada/Swiftcode: TDOMCATTTOR/ Trust Account for Stikeman Keeley Spiegel Pasternack LLP #0690-7372044/Branch # 10202), the sum of US$500,000 in cash, which constituted a loan to Firstgold for immediate working capital purposes (the “Pre-Loan Funding”) The Pre-Loan Funding was evidenced by an unsecured promissory note providing for repayment on the same terms as contemplated under Section 1 hereof. At the time of completion of the Subscription, subject to regulatory
        approval, Northwest shall have the option to convert the Pre-Loan Funding into Shares at the issue price per Share for the Subscription under Section 2 hereof.

         

        

        

        

        4.          Purchase of Notes. Pursuant to agreements entered into on July 16, 2009 between Northwest and the Current Creditors, Northwest will acquire the Notes for a purchase price payable, as to $500,000, by the deposit of such amount pursuant to separate escrow agreements (each, an "Escrow Agreement") dated
        July 16, 2009 between Northwest, each of the Current Creditors and the escrow agent named therein and, as to the balance of $11,000,000, by payment to the Current Creditors prior to September 1, 2009. The parties confirm that Northwest paid $500,000 to the escrow agent on July 17, 2009.

        Northwest and Firstgold agree to amend the terms of the Notes following the acquisition thereof by Northwest to provide that interest on the Notes shall be payable to Northwest at a fixed rate of 10 per cent per annum, calculated and payable monthly in arrears commencing on September 1, 2009.

        Upon completion of the Subscription, the Notes shall be deemed to have been amended effective as of September 1, 2009 so that (a) the aggregate principal amount of the Notes shall be reduced to US$11,500,000 as of such date and (b) all accrued and unpaid interest on the Notes up to such date shall be deemed to be extinguished. Any interest on the Notes paid from September 1, 2009 to completion of the
        Subscription in excess of 10% interest per annum calculated for such period on the deemed principal amount of $11,500,000 shall be refunded by Northwest to Firstgold.

        Firstgold acknowledges that it is in default of various covenants under the Notes, including with respect to the payment of principal and interest, and that no term of this Offer shall be construed in any way as a waiver by Northwest of any right or remedy that will be available to it as a holder of the Notes in respect of any covenant or future Event of Default (as defined in the Notes).

        5.          Escrowed Funds Loan. In the event that a Current Creditor fails to consummate the sale to Northwest of the Notes held by such Current Creditor in accordance with the terms of the Note Purchase Agreement to which such Current Creditor is a party and the escrow agent named in the Escrow Agreement to which such
        Current Creditor is a party delivers to the Current Creditor the Escrowed Funds (as defined in the applicable Escrow Agreement) or fails to return to Northwest, in accordance with the provisions of the applicable Escrow Agreement, the Escrowed Funds, Firstgold shall become indebted to Northwest and hereby promises to pay to, or to the order of, Northwest, the amount of the Escrowed Funds under the relevant Escrow Agreement in the same form, and on substantially the same terms, as the
        promissory note referred to in Section 3 hereof, and Firstgold shall promptly deliver to Northwest an executed copy of such promissory note.

         

        

        

        

        6.          Pre-emptive Rights. In the event the Current Creditors exercise the Warrants (as defined in the Note and Warrant Purchase Agreement), Northwest shall have the right to subscribe for such additional number of Shares at the then maximum allowable discount to the market price as is necessary to maintain the
        percentage ownership of Shares held by Northwest prior to such Warrant exercise.

        7.          Conditions to Offer. This Offer is subject to (i) completion of confirmatory due diligence by Northwest to its satisfaction; (ii) no material breach of any provision of this Offer by Firstgold, (iii) negotiation and execution of all agreements and documents contemplated by this Offer; and (iv) approval of such
        agreements by the governing body of each party.

        8.          Conditions to the Subscription. The Subscription will be subject to customary closing conditions, including the following: (i) to the extent required by law, affirmative vote of the shareholders of Firstgold by a special majority of votes cast in person or by proxy at a shareholders` meeting duly called (i.e.,
        66.67%) for the purpose of consolidating the outstanding Shares on a reverse split basis and increasing the authorized share capital of Firstgold; (ii) regulatory approvals; (iii) representations and warranties of each party are true and correct as of signing the Indebtedness Purchase Agreement and Subscription Agreement and at the closing of the Subscription, in all material respects; (iv) no material breach of covenants by either party; (v) receipt of any material third party consents
        with respect to Firstgold to be identified during due diligence; and (vi) to the extent required by the Toronto Stock Exchange, shareholder approval of the Subscription.

        9.          Support Agreements. Simultaneous with the execution of the Subscription Agreement, Firstgold shall use its best efforts to obtain a support agreement from each director and officer of Firstgold pursuant to which such director and officer agrees to vote his Shares in favour of the Subscription and any other
        matter for which shareholder approval may be required and against all other matters and transactions that could adversely affect or impede the Restructuring, and will grant Northwest an irrevocable proxy to vote such Shares in accordance with the provisions of such voting agreements.

        10.        Board of Directors Approval. The Board of Directors of Firstgold (the "Board") has unanimously approved this Offer. Furthermore, upon completion of final documentation consistent with the terms of this Offer the Board will approve and adopt the Restructuring, the Indebtedness Purchase Agreement and the
        Subscription Agreement and will unanimously recommend the Subscription and that Firstgold’s shareholders vote in favour of the

         

        

        

        

        Subscription at a special meeting of shareholders, and will not change its recommendation in respect thereof.

        11.        Firstgold Shareholder Approval. Firstgold will take all actions required to give notice of and hold a special shareholders meeting to approve all matters requiring shareholder approval as promptly as practicable following the execution of the Subscription Agreement. 

        12.        Composition of Board of Directors; Management. Upon completion of the Subscription, as described in paragraph 2, the Board will appoint three directors designated by Northwest, with the remaining three directors being nominees of management, and the continuing officers of Firstgold will be Sun Feng, Chairman, Terry
        Lynch, Chief Executive Officer, and Jim Kluber, Chief Financial Officer. In the event of a deadlock in any decision requiring the approval of the Board, the Chairman shall have a casting vote. No severance or other termination payments will be owing to the directors of Firstgold in connection with any of their resignations, other than amounts owing for or director fees.

        13.        Closing. Northwest anticipates executing the Indebtedness Purchase Agreement and the Subscription Agreement within thirty (30) days of acceptance of this Offer, and completion of the Subscription as promptly as practicable, which is expected to be no more than thirty (30) days thereafter.

        14.        Other Required Approvals and Consents. No third party lender or creditor consents or authorizations are expected to be required to be obtained by Firstgold in order to consummate the Restructuring.

        15.       Business Covenants. [*] Redacted and omitted pursuant to a request for confidential treatment.

        16.       Due Diligence and Confidentiality. Firstgold will provide such information as to its legal affairs and financial condition as may reasonably be requested by Northwest, and Firstgold (including its officers, directors, employees, affiliates, agents and its professional advisors) will provide all reasonable assistance and
        information to Northwest and its advisors as necessary for Northwest to complete its due diligence reviews as quickly and efficiently as possible. The parties, including their respective officers, directors, accountants, lawyers, agents and other representatives, acknowledge that all verbal and written information provided to either party in furtherance of the execution of this Offer and the terms of this Offer are subject to the terms and conditions of that certain Confidentiality
        Agreement executed in June 2009, between Northwest and Firstgold (the “Confidentiality Agreement”).

         

        

        

        

        17.       Preparation of Documents. Northwest's legal counsel will prepare initial drafts of the Indebtedness Purchase Agreement and the Subscription Agreement. Firstgold's legal counsel shall prepare initial drafts of all Firstgold shareholder approval documents (including, without limitation, a Proxy, Proxy Statement, and Notice of
        Meeting prepared in accordance with applicable law and the policies of the U.S. Securities and Exchange Commission and the Toronto Stock Exchange). To the extent required by either party to fulfill its obligations in this section, the other party will use its best efforts to provide such financial and other company information as required by the party responsible for preparing the document.

        18.       Public Announcement. All press releases and public announcements relating to the Restructuring will be agreed to and prepared jointly by Northwest and Firstgold subject to applicable law and listing requirements. The parties will issue a joint press release upon Northwest entering a binding agreement with the Current
        Creditors to acquire the Notes. 

        19.       Governing Law. The interpretation of this Offer, the Indebtedness Purchase Agreement and the Subscription Agreement will be governed by Nevada law and the laws of the United States of America applicable therein without reference to the conflict of laws provisions thereof.

        20.       Specific Performance. The parties agree that irreparable damage would occur in the event any provision of this Offer was not performed in accordance with the terms thereof and that, prior to the termination of this Offer pursuant to its terms, the parties will be entitled to specific performance of the terms hereof, in
        addition to any other remedy at law or equity.

        21.       Representations. The parties each represent and warrant that they have the corporate power and authority to enter into this Offer and that the execution and delivery of this Offer does not, (i) conflict with any provision of such party’s constating documents as currently in effect, (ii) conflict with, result in a breach
        of, constitute (with or without due notice or lapse of time or both) a default under any contract or agreement of such party not otherwise being terminated pursuant to the Restructuring, or (iii) to each party’s knowledge, violate any judgment, order, decree, statute, law, ordinance, rule or regulation applicable to such party.

        22.       Additional Representations. Firstgold represents and warrants to Northwest that (i) the Transaction Documents (as defined in the Note and Warrant Purchase Agreement), other than the Off-Take Agreement (as defined in the Note and Warrant Purchase Agreement), constitute all the material documents entered into between Firstgold
        and the Current Creditors in connection with the Note and Warrant Purchase Agreement, and (ii) Firstgold has not entered

         

        

        

        

        into the Off-Take Agreement with the Current Creditors.

        23.       Expenses. Each party will be responsible to pay all of its expenses, including the fees of their respective advisors and consultants, incurred in connection with the negotiation and preparation of this Offer, the Indebtedness Purchase Agreement, Subscription Agreement and ancillary agreements thereto and any due diligence
        investigations conducted by Northwest in connection with the Restructuring.

        Upon this letter being signed by Northwest and Firstgold on the date set forth herein, the previous Binding Offer Letter of July 16, 2009 shall be superseded.

        If you are in agreement with the terms of this Offer, please signify such agreement by executing and returning a copy of this Offer to counsel for Northwest.

         

        

        

        

        Sincerely,

        	 	NORTHWEST NON-FERROUS

                INTERNATIONAL INVESTMENT COMPANY

                LIMITED
	 	 
	 	By:	 
	 	 

        Accepted and agreed on August ___, 2009:

         

        	 	FIRSTGOLD CORP.
	 	 
	 	By:20-F/A

Exhibit 4.11  

English Summary of Irrevocable Promissory
Note 

Company: BluePhoenix
Solutions Ltd. 

Lender: Bank Discount
Le’Israel Ltd. 

Dated: July 15, 2007, as amended
August 15, 2007 

As the Company received or will
receive a line of credit from the Lender, the Company commits that as long as there are
debts or liabilities to the Lender, the Company shall meet certain financial ratios at all
times which will be examined according to the Company’s quarterly and annual
financial statements as follows: 

	1. 	Financial
reports: Audited annual financial statements as of December 31st of           each year
will be delivered to the Lender by June 30th the following year.           Quarterly
financial statements will be delivered within 60 days from the end of           the
quarter. 

	2. 	Total
equity will not be less than $50 million and will not be less than 40% of           total
assets. 

	3. 	EBITDA
for each of the last four sequential quarters will not be less than $5           million. 

	4. 	Tangible
Deficit (equity less intangible assets) will not exceed $30 million. 

	5. 	The
Company will not merge with any party without the prior consent of the           Lender. 

	6. 	Total
financial liabilities of the Company to banks will not exceed 60% of total           cash
and accounts receivables. 

	7. 	The
Company will not pledge any of its assets without the prior consent of the
          Lender. 

	8. 	The
Company will not sell or transfer or assign any of its assets without the           prior
consent of the Lender. 

	9. 	The
Company will not enter into any transaction or transfer any of its assets to           an
affiliate, subsidiary or related party, directly or indirectly and will not
          lend money or guarantee any debt of any subsidiary, affiliate or related party
          in an amount that exceeds $2 million without the prior consent of the Lender. 

	10. 	The
Lender has the right to demand repayment of all the outstanding debt and
          liabilities of the Company to the Lender, if a change in control of the Company
          will cause a breach of the regulations or instructions of The Bank of Israel. 

	11. 	The
Lender has the right to demand repayment of all the outstanding debt and
          liabilities of the Company to the Lender within 3 months, in the case of a
          change in control in the Company. 

	12. 	The
Company declared that the Lender’s consent to the credit line is
          conditioned upon the employment of Mr. Arie Kilman as CEO or chairman of the
          Company’s board of directors. 

	13. 	These
covenant will be measured based on the Company’s quarterly financial
          statements, and the Company is liable to correct any breach of any of these
          covenants within 60 days, otherwise this breach will constitute a default. 

	14. 	This
document is a part of all the documents that the Company executes from time           to
time with the Lender. 

	15. 	These
covenants are unconditional and irrevocable and the Company can not cancel           or
change them without the prior written consent of the Lender. 

English Summary of Foreign Currency Loan Request  

			
			
			
			
			
	Borrower:	BluePhoenix Solutions Ltd.
	Lender:	Bank Discount Le'Israel Ltd.
	Loan amount:	$8 million
	Grant date:	September 22, 2008
	1.	Purpose of loan	N.A.
	2.	Loan request	Standard application for requesting a loan.
	3.	Conversion terms	N.A.
	4.a.	Term	60 months starting September 22, 2008 through September 22, 2013
	4.b.1)(a)	Loan payment terms	13 quarterly payments of interest, starting September 22, 2010
	4.b.1)(b)	Interest payment terms	20 quarterly payments of interest, starting December 22, 2008
	4.c.	Interest rate	Libor + 2.80%
	4.d.	Arrears interest	Delayed payment will result in a charge of interest in arrears
	 	 	according to the applicable rate of the Lender at the time of
	 	 	the event
	5.	Documentation fees	$1,000
	6.	Effective cost	N.A.
	7.	Execution of payments	Through debit of the Borrower's checking account
	8.	Collateral	At the request of the Lender, the Borrower will provide
	 	 	collateral.
	9.	Early repayment	The Borrower may repay the loan after advance notice and
	 	 	consent of the Lender and will reimburse the Lender for fees
	 	 	and losses with regard to early repayment.
	10.	Immediate repayment	The Lender may demand immediate repayment of the loan if:
	 	 	–    there is a change in the legal structure of the Borrower
	 	 	      due to merger, a change in core business, or appointment of
	 	 	      a receiver for the assets of the Borrower
	 	 	–    the Borrower fails to meet the loan's terms
	 	 	–    bankruptcy of the Borrower
	 	 	–    insolvency of the Borrower's clients
	 	 	–    the Borrower fails to meet covenants set by the Lender
	 	 	–    breach of any liability of the Borrower to the Lender
	 	 	      arising from any other document or agreement with the Lender
	 	 	–    the Borrower fails to provide timely financial
	 	 	      statements
	11.	Business days	If payment is due on Saturday or Sunday or on a day with no
	 	 	foreign currency trade, the Lender will execute the payment at
	 	 	the nearest date at its sole discretion
	12.	Jurisdiction	Israel
	13.	Renewal	Optional renewal of the loan subject to advance notice of the
	 	 	Borrower and the Lender's consent.
	14.	General	The Lender can assign this agreement. The Borrower may not
	 	 	assign this agreement.

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