Document:

exv10w4

 

Exhibit 10.4

Head Agreement

in relation to the acquisition of the Savage River iron ore mine

Ivanhoe Mines Ltd. (Vendor)

Stemcor Pellets Ltd (Purchaser)

Dominant Holdings AG (Assignee)

Stemcor Holdings Limited (Guarantor)

	 	 	 
	

	 	
	 
	 	 
	

	 	AURORA PLACE, 88 PHILLIP STREET, SYDNEY NSW 2000, DX 117 SYDNEY
	

	 	TEL: +61 2 9921 8888 FAX: +61 2 9921 8123
	

	 	www.minterellison.com

 

 

Head Agreement

in relation to the acquisition of the Savage River iron ore mine

	 	 	 	 	 	 	 
	Details	 	 	4	 
	 
	 	 	 	 	 	 
	Agreed terms	 	 	6	 
	 
	 	 	 	 	 	 
	1.
	 	Defined terms & interpretation	 	 	6	 
	1.1
	 	Defined terms	 	 	6	 
	1.2
	 	Interpretation	 	 	10	 
	1.3
	 	Headings	 	 	11	 
	 
	 	 	 	 	 	 
	2.
	 	Transaction	 	 	11	 
	2.1
	 	Assignment of Debts	 	 	11	 
	2.2
	 	Purchase of Shares	 	 	11	 
	 
	 	 	 	 	 	 
	3.
	 	Transaction Consideration	 	 	11	 
	3.1
	 	Amount	 	 	11	 
	3.2
	 	Initial Transaction Consideration - Tranche 1	 	 	11	 
	3.3
	 	Initial Transaction Consideration - Tranche 2	 	 	11	 
	3.4
	 	Deferred Transaction Consideration to be paid in annual instalments	 	 	12	 
	3.5
	 	Amount of each Instalment	 	 	12	 
	3.6
	 	Stoppage Consideration	 	 	12	 
	3.7
	 	Split of Transaction Consideration	 	 	13	 
	3.8
	 	Cleared funds	 	 	14	 
	 
	 	 	 	 	 	 
	4.
	 	Non-Solicitation Period	 	 	14	 
	4.1
	 	Conduct during Non-Solicitation Period	 	 	14	 
	4.2
	 	Notification of approaches	 	 	14	 
	4.3
	 	Normal provision or information	 	 	14	 
	4.4
	 	Right to exceed Other Proposal	 	 	15	 
	 
	 	 	 	 	 	 
	5.
	 	Representations by parties	 	 	15	 
	5.1
	 	Representations by Assignee	 	 	15	 
	5.2
	 	Tax representation by Assignee	 	 	15	 
	5.3
	 	Application of representations by the Assignee	 	 	16	 
	5.4
	 	Representations by Purchaser	 	 	16	 
	5.5
	 	Tax representation by Purchaser	 	 	16	 
	5.6
	 	Application of representations by the Purchaser	 	 	16	 
	5.7
	 	Representations by Guarantor	 	 	16	 
	5.8
	 	Tax representation by Guarantor	 	 	17	 
	5.9
	 	Application of representations by the Guarantor	 	 	17	 
	5.10
	 	Representations by Vendor	 	 	17	 
	5.11
	 	Application of representations by the Vendor	 	 	17	 
	 
	 	 	 	 	 	 
	6.
	 	Confidentiality and publicity	 	 	18	 
	6.1
	 	Confidentiality – Purchaser	 	 	18	 
	6.2
	 	Confidentiality - Vendor	 	 	18	 
	6.3
	 	Confidential Information	 	 	18	 
	6.4
	 	Announcements	 	 	18	 

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 2

 

 

	 	 	 	 	 	 	 
	7.
	 	Obligation to consult in relation to Production	 	 	19	 
	 
	 	 	 	 	 	 
	8.
	 	Resolution of disputes – international arbitration	 	 	19	 
	 
	 	 	 	 	 	 
	9.
	 	GST	 	 	19	 
	9.1
	 	Interpretation	 	 	19	 
	9.2
	 	GST gross up	 	 	19	 
	9.3
	 	Reimbursements	 	 	19	 
	9.4
	 	Tax invoice	 	 	19	 
	 
	 	 	 	 	 	 
	10.
	 	Guarantor’s guarantee	 	 	19	 
	10.1
	 	Guarantee and indemnity	 	 	19	 
	10.2
	 	Extent of guarantee and indemnity	 	 	20	 
	10.3
	 	Principal and independent obligation	 	 	20	 
	10.4
	 	Enforcement against Guarantor	 	 	20	 
	10.5
	 	Reinstatement of guarantee and indemnity	 	 	20	 
	 
	 	 	 	 	 	 
	11.
	 	Notices and other communications	 	 	21	 
	11.1
	 	Service of notices	 	 	21	 
	11.2
	 	Effective on receipt	 	 	21	 
	 
	 	 	 	 	 	 
	12.
	 	Miscellaneous	 	 	21	 
	12.1
	 	Alterations	 	 	21	 
	12.2
	 	Approvals and consents	 	 	21	 
	12.3
	 	Assignment	 	 	21	 
	12.4
	 	Costs	 	 	21	 
	12.5
	 	Stamp duty	 	 	21	 
	12.6
	 	Survival	 	 	21	 
	12.7
	 	Counterparts	 	 	22	 
	12.8
	 	No merger	 	 	22	 
	12.9
	 	Entire agreement	 	 	22	 
	12.10
	 	Further action	 	 	22	 
	12.11
	 	Severability	 	 	22	 
	12.12
	 	Waiver	 	 	22	 
	12.13
	 	Relationship	 	 	22	 
	12.14
	 	Governing law and jurisdiction	 	 	22	 
	 
	 	 	 	 	 	 
	Schedule 1 - Arbutus Agreement	 	 	23	 
	 
	 	 	 	 	 	 
	Schedule 2 - Beviron Agreement	 	 	24	 
	 
	 	 	 	 	 	 
	Schedule 3 - Deed of Assignment	 	 	25	 
	 
	 	 	 	 	 	 
	Signing page	 	 	26	 

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 3

 

 

Details

	 	 	 
	Date

	 	4 February 2005
	 
	 	 
	Parties
	 	 
	 
	 	 
	Name

	 	Ivanhoe Mines Ltd. ARBN 075 217 097
	Short form name

	 	Vendor
	Notice details

	 	Suite 654, 999 Canada Place, Vancouver, British Columbia V6C 3E1, Canada
	

	 	Facsimile +1 604 682 6728
	

	 	Attention Peter Meredith
	 
	 	 
	Name

	 	Stemcor Pellets Ltd - registered number 2188847
	Short form name

	 	Purchaser
	Notice details

	 	Level 27, City Point, 1 Ropemaker Street, London
	

	 	EC2Y9ST, United Kingdom
	

	 	Facsimile +44 20 7775 3679
	

	 	Attention Company Secretary
	 
	 	 
	Name

	 	Dominant Holdings AG - CH-130.0.005.376-5
	Short form name

	 	Assignee
	Notice details

	 	Poststrasse 5
	

	 	CH-8808 Pfaeffikon SZ
	

	 	Switzerland
	

	 	Facsimile +41 58 261 5001
	

	 	Attention Andreas Baer
	 
	 	 
	Name

	 	Stemcor Holdings Limited
	Short form name

	 	Guarantor
	Notice details

	 	Level 27, City Point, 1 Ropemaker Street, London
	

	 	EC2Y9ST, United Kingdom
	

	 	Facsimile +44 20 7775 3679
	

	 	Attention Company Secretary

Background

	 	 	 
	A

	 	Immediately prior to the assignment of the following debts
under the Deed of Assignment, the Vendor will be the legal and
beneficial owner of the following debts:

(i)      Beviron Debt 2;

(ii)      Beviron Debt 3;

(iii)      Goldamere Debt;

(iv)      Beviron Debt 6; and

(v)      Arbutus Debt.

	 	 	 
	B

	 	The Vendor is the legal and beneficial owner of the Arbutus Shares.

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 4

 

 

	 	 	 
	C

	 	At the Completion Date, the Vendor will be the legal and beneficial owner of the Beviron Shares following the
liquidation of Goldamere Holdings (Canada) Limited and ABM Mining Limited.
	 
	 	 
	D

	 	The Vendor has agreed to assign its rights in relation to the Debts to the Assignee, and the Assignee has agreed to
accept the assignment of the Vendor’s rights in relation to the Debts, on and from 25 February 2005 or such later date
agreed between the Vendor and the Assignee, but in any event a date being no later than one Business Day prior to the
Completion Date on the terms and conditions set out in this agreement and the Transaction Documents.
	 
	 	 
	E

	 	The Vendor has agreed to sell and the Purchaser has agreed to purchase the Beviron Shares on the terms and
conditions set out in this agreement and the Transaction Documents.
	 
	 	 
	F

	 	The Vendor has agreed to sell and the Assignee has agreed to purchase the Arbutus Shares on the terms and
conditions set out in this agreement and the Transaction Documents.
	 
	 	 
	G

	 	The Guarantor is the ultimate holding company of the Purchaser and Assignee and has agreed to guarantee the
obligations of the Purchaser and Assignee under this agreement and the Transaction Documents.

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 5

 

 

Agreed terms

	1.  	Defined terms & interpretation
	 
	1.1  	Defined terms
	 
	   	In this document:
	 
	   	ABM Mining Limited means ABM Mining Limited, a company incorporated in Yukon, Canada,
and having its registered office at 300-204, Black Street,
Whitehorse, Yukon Y1A 2M9, Canada.
	 
	   	Arbutus means Arbutus Holding Ltd., a company incorporated in the British Virgin
Islands, registration number 497003, further details of which are set out in Schedule 1 to
the Arbutus Agreement.
	 
	   	Arbutus Agreement means a share sale agreement in respect of the shares held by the Vendor
in Arbutus in the form attached to this agreement as Schedule 1.
	 
	   	Arbutus Consideration means US$1 and the monetary consideration, if any, as applied
under item 8 of the table in clause 3.7 of this agreement, for the sale of the Arbutus
Shares by the Vendor to the Purchaser in accordance with the terms of the Arbutus Agreement.
	 
	   	Arbutus Debt has the meaning given to that term in the Deed of Assignment.
	 
	   	Arbutus Debt Consideration means US$1 and the monetary consideration, if any, as applied
under item 5 of the table in clause 3.7 of this agreement, for the assignment by the Vendor
of Arbutus Debt to the Assignee in accordance with the terms of the Deed of Assignment.
	 
	   	Arbutus Shares means all of the shares in the capital of Arbutus.
	 
	   	Associate has the meaning given to that term by sections 10 to 17 of the Corporations
Act.
	 
	   	Beviron means Beviron Pty Limited ACN 078 197 323, further details of which are set out
in Part A of Schedule 1 to the Beviron Agreement.
	 
	   	Beviron Agreement means a share sale agreement in respect of the shares held by the Vendor
in Beviron in the form attached to this agreement as Schedule 2.
	 
	   	Beviron Consideration means A$1 and the monetary consideration, if any, as applied under
item 7 of the table in clause 3.7 of this agreement, for the sale of the Beviron Shares by
the Vendor to the Purchaser in accordance with the terms of the Beviron Agreement.
	 
	   	Beviron Shares means all of the shares in the capital of Beviron.
	 
	   	Beviron Debt 2 has the meaning given to that term in the Deed of Assignment.
	 
	   	Beviron Debt 2 Consideration means US$1 and the monetary consideration, if any, as applied
under item 1 of the table in clause 3.7 of this agreement, for the assignment by the Vendor
of Beviron Debt 2 to the Assignee in accordance with the terms of the Deed of Assignment.
	 
	   	Beviron Debt 3 has the meaning given to that term in the Deed of Assignment.
	 
	   	Beviron Debt 3 Consideration means US$1 and the monetary consideration, if any, as applied
under items 2 and 6 of the table in clause 3.6 of this agreement, for the assignment by the
Vendor of Beviron Debt 3 to the Assignee in accordance with the terms of the Deed of
Assignment.
	 
	   	Beviron Debt 3 Interest means interest of US$1,512,920 accrued over the period to 31
December 2001 and forming part of Beviron Debt 3.

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 6

 

 

	   	Beviron Debt 3 Principal means the principal component of Beviron Debt 3, being an amount of
US$9,500,000.
	 
	   	Beviron Debt 6 has the meaning given to that term in the Deed of Assignment.
	 
	   	Beviron Debt 6 Consideration means A$1 and the monetary consideration, if any, as applied
under item 4 of the table in clause 3.7 of this agreement, for the assignment by the Vendor
of Beviron Debt 6 to the Assignee in accordance with the terms of the Deed of Assignment.
	 
	   	Business means the businesses carried on by the Group as at the date of this agreement,
including the business of mining iron ore in the area known as Savage River and the
production of iron ore pellets in Tasmania in Australia carried on under the business name
‘Australian Bulk Minerals’ and includes all licences, authorities, plant and equipment used
in connection with those activities and whose principal place of business is 58-60 Wilmot
Street, Burnie, Tasmania, 7320, Australia.
	 
	   	Business Day means:

	 	(a)  	for receiving a Notice under clause 11, a day that is not a Saturday, Sunday,
public holiday or bank holiday in the place where the Notice is received; and
	 
	 	(b)  	for all other purposes, a day that is not a Saturday, Sunday, public holiday or
bank holiday in New South Wales.

	   	Business Hours means from 9.00am to 5.00pm on a Business Day.
	 
	   	Cashflow Adjustment means an amount calculated in accordance with the following
formula:

	 	 	 	 	 
	Cashflow Adjustment

	 	=
	 	Sales for the relevant Ore Year
	

	 	 	 	 
	

	 	 	 	 1,800,000

	   	Completion Date has the meaning given to that term in the Beviron Agreement.
	 
	   	Confidential Information means:

	 	(a)  	all information of, used by, related to or connected with the Business, any
Group Company or their transactions, operations and affairs;
	 
	 	(b)  	all other information treated by any Group Company as confidential;
	 
	 	(c)  	all notes, data, reports and other records (whether or not in tangible form)
based on, incorporating or derived from information referred to in paragraphs (a) or
(b); and
	 
	 	(d)  	all copies (whether or not in tangible form) of the information, notes, reports
and records referred to in paragraphs (a), (b) or (c),

	   	that is not public knowledge (otherwise than as a result of a breach of a confidentiality
obligation of a party).
	 
	   	Corporations Act means the Corporations Act 2001 (Cth).
	 
	   	Debts means:

	 	(i)  	Beviron Debt 2;
	 
	 	(ii)  	Beviron Debt 3;
	 
	 	(iii)  	Beviron Debt 6;
	 
	 	(iv)  	Goldamere Debt; and
	 
	 	(v)  	Arbutus Debt.

	   	Deed of Assignment means a deed of assignment in respect of the Debts in a form
substantially similar to that attached to this agreement as Schedule 3.

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 7

 

 

	   	Deferred Transaction Consideration means an amount comprised of five (5) annual
Instalments, payable in accordance with clause 3.4.
	 
	   	dltu means dry long tonne units.
	 
	   	Event 1 Amount means the total amount of iron ore pellets (expressed in dry metric tonnes)
produced by the Business in the Pellet Period but not sold. An amount of iron ore pellets
will be taken to have been sold by the Business in the Pellet Period where the date of the
bill of lading relating to the shipment of those iron ore pellets falls within the Pellet
Period.
	 
	   	Event 1 Date means five (5) Business Days after the first date on which Sales since the end
of the Pellet Period exceeds the Event 1 Amount.
	 
	   	Event 2 Amount means the difference between Full Capacity and Production for the Pellet
Period (expressed in dry metric tonnes).
	 
	   	Event 2 Date means five (5) Business Days after the first date on which Sales since the end
of the Pellet Period exceeds the amount determined by adding the Event 1 Amount to the Event
2 Amount.
	 
	   	Full Capacity means 8.815 million dry metric tonnes of iron ore pellets.
	 
	   	Goldamere means Goldamere Pty Limited ACN 073 634 581, further details of which are set
out in Part B of Schedule 1 to the Beviron Agreement
	 
	   	Goldamere Debt has the meaning given to that term in the Deed of Assignment.
	 
	   	Goldamere Debt Consideration means US$1 and the monetary consideration, if any, as applied
under item 3 of the table in clause 3.7 of this agreement, for the assignment by the Vendor
of Goldamere Debt to the Assignee in accordance with the terms of the Deed of Assignment.
	 
	   	Goldamere Holdings (Canada) Limited means Goldamere Holdings (Canada) Limited, a
company incorporated in Yukon, Canada, and having its registered office at 300-204, Black
Street, Whitehorse, Yukon Y1A 2M9, Canada.
	 
	   	Group means Beviron and Goldamere.
	 
	   	Group Company means any of Beviron and Goldamere.
	 
	   	Initial Transaction Consideration — Tranche 1 means the amount of US$15,000,000, payable in
accordance with clause 3.2.
	 
	   	Initial Transaction Consideration — Tranche 2 means the amount of US$6,500,000 (or as may be
increased under clause 3.3), payable in accordance with clause 3.3.
	 
	   	Instalment means an instalment of the Deferred Transaction Consideration the amount of which
is to be calculated in accordance with clause 3.5 and is to be paid in accordance with
clause 3.4.
	 
	   	Liabilities includes all liabilities (whether actual, contingent or prospective),
losses, damages, costs and expenses of whatever description.
	 
	   	mt means metric tonne.
	 
	   	Nibrasco Pellet Price means the effective price (NPP) expressed in metric tonne (mt)
calculated from the Nibrasco/JSM fob Tubarao price level as quoted in the TEX Report and
expressed in US cents per dltu using the following formula:

	 	 	 	 	 
	NPP (mt)

	 	=
	 	Nibrasco/JSM price per dltu * 0.655)
	

	 	 	 	 
	

	 	 	 	 1.0161

	   	For example, in 2004:

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 8

 

 

	 	 	 	 	 	 	 	 	 	 	 
	NPP (mt)

	 	=
	 	 	(59.10 * 0.655	)	 	=
	 	US$38.097 per mt
	

	 	 	 	 	 	 	 	 	 	 
	

	 	 	 	 	1.0161	 	 	 	 	 

	   	Non-Solicitation Period means the period from the date of execution of this agreement
to the Completion Date, inclusive.
	 
	   	NPPM means the number in the first column of the table in clause 3.5 nearest to the Nibrasco
Pellet Price shown in the second column of that table as at the date that an Instalment is
required to be paid in accordance with clause 3.4.
	 
	   	Ore Year means the period from 1 April in any given year to 31 March of the following year.
	 
	   	Other Proposal means any expression of interest, proposal or offer by any person (other than
the Purchaser or an Associate of the Purchaser) to evaluate or enter into any transaction
the terms of which are similar to those set out in this agreement, or under which:

	 	(a)  	that person (together with its Associates) may acquire any interest in the
Shares or any shares in Goldamere;
	 
	 	(b)  	that person may acquire, directly or indirectly (including by way of joint
venture, dual listed company structure or otherwise), any interest in all or a
substantial part of the Business;
	 
	 	(c)  	that person may otherwise acquire control of or merge or amalgamate with any or
all of Arbutus, Beviron and Goldamere;
	 
	 	(d)  	Any or all of Arbutus, Beviron and Goldamere, will issue any of its share
capital as consideration for the assets or share capital of another person; or
	 
	 	(e)  	Any or all of Arbutus, Beviron and Goldamere, will effect or implement any
reorganisation, recapitalisation or dissolution.

	   	Pellet Period means the period from 1 April 2005 to 31 March 2010.
	 
	   	Production means the amount of iron ore pellets (expressed in dry metric tonnes) produced by
the Business in a given period.
	 
	   	Sales means the total amount of iron ore pellets (expressed in dry metric tonnes) sold (at
any price) by the Business in the relevant period. An amount of iron ore pellets will be
taken to have been sold by the Business in a relevant period where the date of the bill of
lading relating to the shipment of those iron ore pellets falls within the relevant period.
	 
	   	Sales Target means Sales during the Pellet Period equal to or exceeding Production for the
Pellet Period.
	 
	   	Shares means the Arbutus Shares and the Beviron Shares.
	 
	   	Stoppage Consideration means an amount payable (if any) under clause 3.6.
	 
	   	Tax means all forms of taxes, duties, imposts, charges, withholdings, rates, levies or
other governmental impositions of whatever nature and by whatever authority imposed,
assessed or charged together with all costs, charges, interest, penalties, fines, expenses
and other additional statutory charges, incidental or related to the imposition.
	 
	   	Transaction Consideration means the monetary consideration (deferred, conditional or
otherwise) for the transactions contemplated by this agreement and the Transaction
Documents, as set out in clause 3.
	 
	   	Transaction Documents means the:

	 	(i)  	Arbutus Agreement;

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 9

 

 

	 	(ii)  	Beviron Agreement; and
	 
	 	(iii)  	Deed of Assignment.

	1.2  	Interpretation
	 
	   	In this agreement, except where the context otherwise requires:

	 	(a)  	the singular includes the plural and vice versa, and a gender includes other
genders;
	 
	 	(b)  	another grammatical form of a defined word or expression has a corresponding
meaning;
	 
	 	(c)  	a reference to a clause, paragraph, schedule or annexure is to a clause or
paragraph of, or schedule or annexure to, this agreement, and a reference to this
agreement includes any schedule or annexure;
	 
	 	(d)  	a reference to a document or instrument includes the document or instrument as
novated, altered, supplemented or replaced from time to time;
	 
	 	(e)  	a reference to A$, $A or AUD is to Australian currency;
	 
	 	(f)  	a reference to US$, $US or USD is to United States currency;
	 
	 	(g)  	a reference to time is to Sydney, Australia time;
	 
	 	(h)  	a reference to a party is to a party to this agreement, and a reference to a
party to a document includes the party’s executors, administrators, successors and
permitted assigns and substitutes;
	 
	 	(i)  	a reference to a person includes a natural person, partnership, body corporate,
association, governmental or local authority or agency or other entity;
	 
	 	(j)  	a reference to a statute, ordinance, code or other law includes regulations and
other instruments under it and consolidations, amendments, re-enactments or
replacements of any of them;
	 
	 	(k)  	a word or expression defined in the Corporations Act has the meaning given to
it in the Corporations Act;
	 
	 	(l)  	the meaning of general words is not limited by specific examples introduced by
including, for example or similar expressions;
	 
	 	(m)  	any agreement, representation, warranty or indemnity by two or more parties
(including where two or more persons are included in the same defined term) binds them
jointly and severally;
	 
	 	(n)  	any agreement, representation, warranty or indemnity in favour of two or more
parties (including where two or more persons are included in the same defined term) is
for the benefit of them jointly and severally;
	 
	 	(o)  	a rule of construction does not apply to the disadvantage of a party because
the party was responsible for the preparation of this agreement or any part of it; and
	 
	 	(p)  	if a day on or by which an obligation must be performed or an event must occur
is not a Business Day, the obligation must be performed or the event must occur on or
by the next Business Day.
	 
	 	(q)  	a reference to except as disclosed is to something disclosed in this agreement
or the Disclosure Letters referred to in the Beviron Agreement and Arbutus Agreement.

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 10

 

 

	1.3  	Headings
	 
	   	Headings are for ease of reference only and do not affect interpretation.
	 
	2.  	Transaction
	 
	2.1  	Assignment of Debts
	 
	   	The parties agree to enter into the following documents in order that the Debts may be
assigned by the Vendor to the Assignee on the terms and conditions set out in the relevant
Transaction Document:

	 	 	 	 	 
	Loan	 	Transaction Document	 	 
	 
	Beviron Debt 2

	 	Deed of Assignment	 	 
	 
	Beviron Debt 3

	 	Deed of Assignment	 	 
	 
	Goldamere Debt

	 	Deed of Assignment	 	 
	 
	Beviron Debt 6

	 	Deed of Assignment	 	 
	 
	Arbutus Debt

	 	Deed of Assignment	 	 
	 

	2.2  	Purchase of Shares
	 
	   	The parties agree to enter into the following documents in order that the Vendor will
sell the Shares and:

	 	(a)  	the Purchaser will purchase the Beviron Shares; and
	 
	 	(b)  	the Assignee will purchase the Arbutus Shares,

	    	on the terms and conditions set out in the relevant Transaction Document:

	 	 	 	 	 
	Shares	 	Transaction Document	 	 
	 
	Arbutus Shares

	 	Arbutus Agreement	 	 
	 
	Beviron Shares

	 	Beviron Agreement	 	 
	 

	3.  	Transaction Consideration
	 
	3.1  	Amount
	 
	   	The Transaction Consideration comprises:

	 	(a)  	The Initial Transaction Consideration — Tranche 1;
	 
	 	(b)  	The Initial Transaction Consideration — Tranche 2;
	 
	 	(c)  	The Deferred Transaction Consideration (if any); and
	 
	 	(d)  	The Stoppage Consideration (if any).

	3.2  	Initial Transaction Consideration — Tranche 1
	 
	   	The Assignee must pay the Initial Transaction Consideration — Tranche 1 on the
Completion Date.
	 
	3.3  	Initial Transaction Consideration — Tranche 2
	 
	   	The Initial Transaction Consideration — Tranche 2 is to be paid on or before either:

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 11

 

 

	 	(a)  	31 July 2005; or
	 
	 	(b)  	31 January 2006,

	   	at the Assignee’s option, provided however that if the Assignee does not pay the Initial
Transaction Consideration — Tranche 2 on or before 31 July 2005, the Initial Transaction
Consideration — Tranche 2 shall be increased by an amount equal to US$195,000.
	 
	3.4  	Deferred Transaction Consideration to be paid in annual instalments
	 
	   	The Deferred Transaction Consideration will be payable in five (5) annual Instalments
by the party whose name is shown next to the relevant item in the table in clause 3.7. The
amount of each Instalment is to be determined by reference to clause 3.5 and is to be paid
not later than 31 March of the calendar year in which the Instalment is required to be paid.
	 
	   	The first Instalment under this clause 3.4 is required to be paid on 31 March 2006.
	 
	3.5  	Amount of each Instalment
	 
	   	The amount of each Instalment is to be determined in accordance with the following
formula:

	 	 	 	 	 
	Instalment

	 	=
	 	NPPM x US$1,800,000 x Cashflow Adjustment

	   	where NPPM (the Nibrasco Pellet Price multiplier) expressed in US$  per mt is determined by
reference to the following table:

	 	 	 	 
	NPPM	 	 	Nibrasco Pellet Price as at the date that the Instalment is required to be paid
	 	 	 	 
	Nil

	 	 	Less than US$30 per mt
	 
	 	 	 
	1

	 	 	Greater than or equal to US$30 per mt but less than US$35 per mt
	 
	 	 	 
	1.5

	 	 	Greater than or equal to US$35 per mt but less than US$40 per mt
	 
	 	 	 
	2

	 	 	Greater than or equal to US$40 per mt but less than US$42.5 per mt
	 
	 	 	 
	3

	 	 	Greater than or equal to US$42.5 per mt but less than US$43.75 per mt
	 
	 	 	 
	3.5

	 	 	Greater than or equal to US$43.75 per mt but less than US$45 per mt
	 
	 	 	 
	4

	 	 	Greater than or equal to US$45 per mt but less than US$47.5 per mt
	 
	 	 	 
	5

	 	 	Greater than or equal to US$47.5 per mt but less than US$50 per mt
	 
	 	 	 
	6

	 	 	Greater than or equal to US$50 per mt but less than US$55 per mt
	 
	 	 	 
	7.75

	 	 	Greater than or equal to US$55 per mt but less than US$60 per mt
	 
	 	 	 
	9.5

	 	 	Greater than or equal to US$60 per mt but less than US$65 per mt
	 
	 	 	 
	11.25

	 	 	Greater than or equal to US$65 per mt but less than US$70 per mt
	 
	 	 	 
	13

	 	 	Greater than or equal to US$70 per mt but less than US$75 per mt
	 
	 	 	 
	14.75

	 	 	Greater than or equal to US$75 per mt but less than US$80 per mt
	 
	 	 	 
	16.5

	 	 	Greater than or equal to US$80 per mt

	3.6  	Stoppage Consideration
	 
	   	Where one of the events set out in the following table occurs, an amount of Stoppage
Consideration shown next to that item shall be payable on or before the date indicated:

			
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	 	 	 	 	 	 	Date on or before
	 	 	 	 	 	 	which Stoppage
	 	 	 	 	 	 	Consideration to be
	 	 	Event	 	Stoppage Consideration	 	paid
	 
	1.

	 	Where the Sales
Target is not met
for the Pellet
Period
	 	The amount determined
by multiplying the
Event 1 Amount by
US$1 and then by the
NPPM (as determined
under clause 3.5 for
the Ore Year in which
the Event 1 Date
falls)
	 	Event 1 Date
	 
	2.

	 	Production at the
Savage River Mine
during the Pellet
Period is less than
95% of Full
Capacity
	 	The amount determined
by multiplying the
Event 2 Amount by
US$1 and then by the
NPPM (as determined
under clause 3.5 for
the Ore Year in which
the Event 2 Date
falls)
	 	Event 2 Date
	 

	3.7  	Split of Transaction Consideration
	 
	   	The Transaction Consideration shall be applied in the following order sequentially
(provided, however, that the Guarantor may, at sole discretion, direct that the order of
items 6 and 7 in the table be reversed) and be paid by the party whose name is shown next to
the relevant item number, until it is exhausted such that the amount applied in respect of
each item does not exceed the corresponding maximum amount(s) as shown in the table:

	 	 	 	 	 	 	 
	 	 	 	 	Maximum	 	 
	 	 	 	 	amount to be	 	 
	Rank	 	As consideration for:	 	applied:	 	Party
	 
	1.

	 	The assignment by the Vendor of
Beviron Debt 2 to the Assignee in
accordance with the terms of the
Deed of Assignment.
	 	US$5,000,000
	 	Assignee
	 
	2.

	 	The assignment by the Vendor of
Beviron Debt 3 Principal to the
Assignee in accordance with the
terms of the Deed of Assignment.
	 	US$9,500,000
	 	Assignee
	 
	3.

	 	The assignment by the Vendor of
Goldamere Debt to the Assignee in
accordance with the terms of the
Deed of Assignment.
	 	US$15,200,397
and
A$4,457,802
	 	Assignee
	 
	4.

	 	The assignment by the Vendor of
Beviron Debt 6 to the Assignee in
accordance with the terms of the
Deed of Assignment.
	 	A$11,000,000
	 	Assignee
	 
	5.

	 	The assignment by the Vendor of
Arbutus Debt to the Assignee in
accordance with the terms of the
Deed of Assignment.
	 	US$8,192,085
	 	Assignee
	 
	6.

	 	The assignment by the Vendor of
the Beviron Debt 3 Interest to the
Assignee in accordance with the
terms of the Deed of Assignment.
	 	US$1,512,920
	 	Assignee
	 
	7.

	 	The purchase of the Beviron Shares.
	 	A$126,180,149
	 	Purchaser
	 

			
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	 	 	 	 	Maximum	 	 
	 	 	 	 	amount to be	 	 
	Rank	 	As consideration for:	 	applied:	 	Party
	8.

	 	The purchase of the Arbutus Shares.
	 	The remaining

Transaction

Consideration
	 	Assignee
	 

	3.8  	Cleared funds
	 
	   	All payments under this clause 3 must be paid by bank cheque, telegraphic transfer to
an account or accounts nominated by the Vendor or otherwise in cleared funds.
	 
	4.  	Non-Solicitation Period
	 
	4.1  	Conduct during Non-Solicitation Period
	 
	   	During the Non-Solicitation Period, the Vendor must not, subject to this clause 4, and
must use its best efforts to cause its Associates, officers and advisers not to:

	 	(a)  	solicit, encourage or invite, directly or indirectly, any enquiries,
discussions or proposals in relation to, or which may reasonably be expected to lead
to, an Other Proposal;
	 
	 	(b)  	initiate any discussions or negotiations in relation to, or which may
reasonably be expected to lead to, an Other Proposal or which might otherwise lead to
the transactions set out in this agreement not proceeding, whether any such discussions
or negotiations are solicited or encouraged by the Vendor or otherwise;
	 
	 	(c)  	recommend or endorse, or propose to recommend or endorse, any Other Proposal;
or
	 
	 	(d)  	communicate to any person an intention to do any of the things referred to in
clauses 4.1(a) to 4.1(c).

	4.2  	Notification of approaches
	 
	   	During the Non-Solicitation Period, the Vendor will promptly advise the Purchaser of:

	 	(a)  	any approach, inquiry or proposal made to, and any attempt to initiate
negotiations or discussions with Vendor or its Associates with respect to any Other
Proposal, whether unsolicited or otherwise;
	 
	 	(b)  	any request for information relating to the Group, any Group Company or the
Business which the Vendor has reasonable grounds to suspect may relate to a current or
future Other Proposal;
	 
	 	(c)  	the identity of the person or persons taking any action referred to clause
4.2(a) or 4.2(b), and the terms and conditions of any Other Proposal; and
	 
	 	(d)  	any provision by the Vendor or any of its Associates of any information
relating to the Group, any Group Company or the Business to any person in connection
with or for the purposes of an Other Proposal.

	4.3  	Normal provision or information
	 
	   	Nothing in this clause 4 prevents the Vendor from:

	 	(a)  	providing information to its Associates;
	 
	 	(b)  	the provision of any information required by law;
	 
	 	(c)  	permitting any party that has, prior to the commencement of the
Non-Solicitation Period, made or indicated its intention to make an Other Proposal from
initiating, pursuing or completing due diligence investigations in relation to the
Group, any Group Company, Arbutus or the Business;

			
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	 	(d)  	providing any information in relation to the Group, any Group Company or the
Business as any such party to this agreement may request in connection with such due
diligence investigations; or
	 
	 	(e)  	receiving an Other Proposal from any such party.

	4.4  	Right to exceed Other Proposal
	 
	   	If, prior to the Completion Date, a party other than the Purchaser makes an Other
Proposal (the First Offer) to the Vendor that its Board of Directors determines, in the
exercise of its fiduciary duties, is superior in any material respect to the terms hereof,
the Vendor shall give notice in writing to the Purchaser of such Other Proposal within two
business days of the date of such determination by the Board. If, within seven business
days of the delivery of such notice, the Purchaser does not deliver an offer in writing to
the Vendor that the Board of Directors of the Vendor concludes, in the exercise of its
fiduciary duties, is superior in a material respect to the First Offer, the Vendor shall be
free to terminate this agreement and all Transaction Documents, accept the First Offer and
complete the transaction contemplated thereby with the buyer thereunder. In such event,
upon closing of the transaction contemplated by the First Offer, the Vendor shall reimburse
an amount, not to exceed US$200,000, to the Purchaser as reimbursement of reasonable and
properly documented expenses directly incurred by the Purchaser in connection with the
negotiation and entering into of this agreement and the Transaction Documents, the conduct
of its due diligence enquiries and satisfaction of any conditions precedent, within 14 days
after the Purchaser gives to the Vendor a copy of the detailed invoice for the amount it
claims by way of reimbursement.
	 
	5.  	Representations by parties
	 
	5.1  	Representations by Assignee
	 
	   	The Assignee represents and warrants to the Vendor that each of the following
statements is true and accurate at the date of this agreement and will be true and accurate
on the Completion Date:

	 	(a)  	it is validly existing under the laws of its place of incorporation or
registration;
	 
	 	(b)  	it has the power (not limited by its constitution) to enter into and perform
its obligations under this agreement and to carry out the transactions contemplated by
this agreement;
	 
	 	(c)  	it has taken all necessary action to authorise its entry into and performance
of this agreement and to carry out the transactions contemplated by this agreement and
the Transaction Documents;
	 
	 	(d)  	its obligations under this agreement are valid and binding and enforceable
against it in accordance with their terms; and
	 
	 	(e)  	neither it nor any party related to it has taken any action under which any
person is or may be entitled to a commission, brokerage or finder’s fee in connection
with the transactions contemplated by this agreement and the Transaction Documents.

	5.2  	Tax representation by Assignee
	 
	   	The Assignee represents and warrants to the Vendor that it is not, and will not before
all Transaction Consideration is paid in accordance with clause 3, either:

	 	(a)  	become a resident of Australia for tax purposes; or
	 
	 	(b)  	carry on business in Australia at or through a permanent establishment.

			
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	   	In the event that it breaches the warranty set out in this clause 5.2, the Assignee will be
liable to indemnify the Vendor for all Tax Liabilities resulting from such breach. For the
avoidance of doubt, this obligation is an obligation to which clause 10 of this agreement
applies.
	 
	5.3  	Application of representations by the Assignee
	 
	   	Each of the representations made by the Assignee under clauses 5.1 and 5.2 remains in
full force and effect on and after the completion of any transactions contemplated by this
agreement and the Transaction Documents.
	 
	5.4  	Representations by Purchaser
	 
	   	The Purchaser represents and warrants to the Vendor that each of the following
statements is true and accurate at the date of this agreement and will be true and accurate
on the Completion Date:

	 	(a)  	it is validly existing under the laws of its place of incorporation or
registration;
	 
	 	(b)  	it has the power (not limited by its constitution) to enter into and perform
its obligations under this agreement and to carry out the transactions contemplated by
this agreement;
	 
	 	(c)  	it has taken all necessary action to authorise its entry into and performance
of this agreement and to carry out the transactions contemplated by this agreement and
the Transaction Documents;
	 
	 	(d)  	its obligations under this agreement are valid and binding and enforceable
against it in accordance with their terms; and
	 
	 	(e)  	neither it nor any party related to it has taken any action under which any
person is or may be entitled to a commission, brokerage or finder’s fee in connection
with the transactions contemplated by this agreement and the Transaction Documents.

	5.5  	Tax representation by Purchaser
	 
	   	The Purchaser represents and warrants to the Vendor that it is not, and will not before
all Transaction Consideration is paid in accordance with clause 3, either:

	 	(a)  	become a resident of Australia for tax purposes; or
	 
	 	(b)  	carry on business in Australia at or through a permanent establishment.

	   	In the event that it breaches the warranty set out in this clause 5.5, the Purchaser will be
liable to indemnify the Vendor for all Tax Liabilities resulting from such breach. For the
avoidance of doubt, this obligation is an obligation to which clause 10 of this agreement
applies.
	 
	5.6  	Application of representations by the Purchaser
	 
	   	Each of the representations made by the Purchaser under clauses 5.4 and 5.5 remains in
full force and effect on and after the completion of any transactions contemplated by this
agreement and the Transaction Documents.
	 
	5.7  	Representations by Guarantor
	 
	   	The Guarantor represents and warrants to the Vendor that each of the following
statements is true and accurate at the date of this agreement and will be true and accurate
on the Completion Date:

	 	(a)  	it is validly existing under the laws of its place of incorporation or
registration;
	 
	 	(b)  	it has the power (not limited by its constitution) to enter into and perform
its obligations under this agreement and to carry out the transactions contemplated by
this agreement;

			
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	 	(c)  	it has taken all necessary action to authorise its entry into and performance
of this agreement and to carry out the transactions contemplated by this agreement and
the Transaction Documents;
	 
	 	(d)  	its obligations under this agreement are valid and binding and enforceable
against it in accordance with their terms; and
	 
	 	(e)  	neither it nor any party related to it has taken any action under which any
person is or may be entitled to a commission, brokerage or finder’s fee in connection
with the transactions contemplated by this agreement and the Transaction Documents.

	5.8  	Tax representation by Guarantor
	 
	   	The Guarantor represents and warrants to the Vendor that it is not, and will not before
all Transaction Consideration is paid in accordance with clause 3, either:

	 	(a)  	become a resident of Australia for tax purposes; or
	 
	 	(b)  	carry on business in Australia at or through a permanent establishment.

	   	In the event that it breaches the warranty set out in this clause 5.8, the Guarantor will be
liable to indemnify the Vendor for all Tax Liabilities resulting from such breach.
	 
	5.9  	Application of representations by the Guarantor
	 
	   	Each of the representations made by the Guarantor under clauses 5.7 and 5.8 remains in
full force and effect on and after the completion of any transactions contemplated by this
agreement and the Transaction Documents.
	 
	5.10  	Representations by Vendor
	 
	   	The Vendor represents and warrants to the Purchaser and the Assignee that each of the
following statements is true and accurate at the date of this agreement and will be true and
accurate on the Completion Date:

	 	(a)  	it is validly existing under the laws of its place of incorporation or
registration;
	 
	 	(b)  	it has the power (not limited by its constitution) to enter into and perform
its obligations under this agreement and to carry out the transactions contemplated by
this agreement;
	 
	 	(c)  	it has taken all necessary action to authorise its entry into and performance
of this agreement and to carry out the transactions contemplated by this agreement and
the Transaction Documents;
	 
	 	(d)  	its obligations under this agreement are valid and binding and enforceable
against it in accordance with their terms; and
	 
	 	(e)  	neither it nor any party related to it has taken any action under which any
person is or may be entitled to a commission, brokerage or finder’s fee in connection
with the transactions contemplated by this agreement and the Transaction Documents.

	5.11  	Application of representations by the Vendor
	 
	   	Each of the representations made by the Vendor under clause 5.10 remains in full force
and effect on and after the completion of any transactions contemplated by this agreement
and the Transaction Documents.

			
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	6.  	Confidentiality and publicity
	 
	6.1  	Confidentiality – Purchaser
	 
	   	The Purchaser and its Associates:

	 	(a)  	must keep confidential any confidential information of the Vendor and all
Confidential Information disclosed to the Purchaser and/or any of its Associates by or
on behalf of the Vendor, or of which the Purchaser and/or any of its Associates becomes
aware (whether before or after the date of this agreement); and
	 
	 	(b)  	may disclose any confidential information in respect of which the Purchaser
and/or any of its Associates has an obligation of confidentiality under paragraph (a)
only to those of the Purchaser’s officers or employees or advisers who have a need to
know for the purposes of this agreement and the transactions contemplated by it.

	6.2  	Confidentiality — Vendor
	 
	   	The Vendor and its Associates:

	 	(a)  	must keep confidential any confidential information of the Purchaser and all
Confidential Information disclosed to the Vendorand/or any of its Associates by or on
behalf of the Purchaser, or of which the Vendor and/or any of its Associates becomes
aware (whether before or after the date of this agreement); and
	 
	 	(b)  	may disclose any confidential information in respect of which the Vendor and/or
any of its Associates has an obligation of confidentiality under paragraph 6.1(a) only
to those of the Vendor officers or employees or advisers who have a need to know for
the purposes of this agreement and the transactions contemplated by it.

	6.3  	Confidential Information
	 
	   	The provisions of clauses 6.1 and 6.2 apply:

	 	(a)  	with respect to Confidential Information:

	 	(i)  	until completion of all transactions contemplated by this
agreement or the Transaction Documents; or
	 
	 	(ii)  	for a period of three years after termination of this agreement,

	 	   	whichever first occurs; and
	 
	 	(b)  	with respect to any other confidential information of the Vendor or the
Purchaser, until that information is public knowledge (otherwise than as a result of a
breach of confidentiality by the Purchaser or Vendor (as applicable) or any of its
permitted discloses).

	6.4  	Announcements
	 
	   	A party must not make or authorise a press release or public announcement relating to
the negotiations of the parties or the subject matter or provisions of this agreement
(Announcement) unless:

	 	(a)  	it is required to be made by law or the rules of the Australian Stock Exchange,
Toronto Stock Exchange, NASDAQ or any other relevant stock exchange and before it is
made that party has made reasonable efforts to:

	 	(i)  	notify the Purchaser and the Vendor; and
	 
	 	(ii)  	give the Purchaser and the Vendor a reasonable opportunity to
comment on the contents of, and the requirement for, the Announcement; or

			
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	 	(b)  	it has the prior written approval of the Purchaser and the Vendor.

	7.  	Obligation to consult in relation to Production
	 
	   	The Purchaser agrees to procure that Goldamere consults with the Vendor in relation to
any events which may or will result in Production for a given Ore Year during the Pellet
Period falling below the amount shown for that Ore Year in the 2005 Savage River mine plan.
	 
	8.  	Resolution of disputes – international arbitration
	 
	   	All disputes arising out of or in connection with this contract must be finally settled
under the Rules of Arbitration of the International Chamber of Commerce by one or more
arbitrators appointed in accordance with those Rules.
	 
	9.  	GST
	 
	9.1  	Interpretation
	 
	   	In this clause 9, a word or expression defined in the A New Tax System (Goods and
Services Tax) Act 1999 (Cth) has the meaning given to it in that Act.
	 
	9.2  	GST gross up
	 
	   	If a party makes a supply under or in connection with this agreement in respect of
which GST is payable, the consideration for the supply but for the application of this
clause 9.2 (GST exclusive consideration) is increased by an amount equal to the GST
exclusive consideration multiplied by the rate of GST prevailing at the time the supply is
made.
	 
	9.3  	Reimbursements
	 
	   	If a party must reimburse or indemnify another party for a loss, cost or expense, the
amount to be reimbursed or indemnified is first reduced by any input tax credit the other
party is entitled to for the loss, cost or expense, and then increased in accordance with
clause 9.2.
	 
	9.4  	Tax invoice
	 
	   	A party need not make a payment for a taxable supply made under or in connection with
this agreement until it receives a tax invoice for the supply to which the payment relates.
	 
	10.  	Guarantor’s guarantee
	 
	10.1  	Guarantee and indemnity

	 	(a)  	In consideration of the Vendor agreeing to enter into this agreement and the
Transaction Documents at the Guarantor’s request, the Guarantor unconditionally and
irrevocably:

	 	(i)  	guarantees to the Vendor the due and punctual performance and
observance by the Purchaser and Assignee of all of the obligations contained in

or implied under this agreement and the Transaction Documents that must be
performed and observed by the Purchaser and Assignee (Guaranteed Obligations);
and
	 
	 	(ii)  	(as an additional and separately enforceable obligation to the
guarantee in clause 10.1(a)(i)) indemnifies the Vendor against all losses,
damages, costs and expenses which the Vendor may now or in the future suffer or
incur consequent on or arising directly or indirectly out of any breach or
non-observance by the Purchaser or Assignee of a Guaranteed Obligation.

			
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	 	(b)  	If the Purchaser or Assignee (as applicable) fails to perform a Guaranteed
Obligation on time, the Guarantor must perform that Guaranteed Obligation on demand by
the Vendor (whether or not the Vendor has demanded that the Purchaser or Assignee (as
applicable) do so).

	10.2  	Extent of guarantee and indemnity
	 
	   	This clause 10 applies and the obligations of the Guarantor remain unaffected despite:

	 	(a)  	an amendment of this agreement or any of the Transaction Documents, whether
with or without the Guarantor’s knowledge or consent; or
	 
	 	(b)  	a rule of law or equity to the contrary; or
	 
	 	(c)  	an insolvency event affecting a person or the death of a person; or
	 
	 	(d)  	a change in the constitution, membership, or partnership of a person; or
	 
	 	(e)  	the partial performance of the Guaranteed Obligations; or
	 
	 	(f)  	the Guaranteed Obligations not being enforceable at any time (whether by reason
of a legal limitation, disability or incapacity on the part of the Purchaser and/or the
Assignee and whether this agreement is void ab initio or is subsequently avoided)
against the Purchaser and/or the Assignee; or
	 
	 	(g)  	the Vendor granting any time or other indulgence or concession to, compounding
or compromising with, or wholly or partially releasing the Purchaser, the Assignee or
the Guarantor of an obligation; or
	 
	 	(h)  	another thing happening that might otherwise release, discharge or affect the
obligations of the Guarantor under this agreement.

	10.3  	Principal and independent obligation
	 
	   	Each of the guarantee in clause 10.1(a)(i) and the indemnity in clause 10.1(a)(ii) is:

	 	(a)  	a principal obligation and is not to be treated as ancillary or collateral to
another right or obligation; and
	 
	 	(b)  	independent of and not in substitution for or affected by another security
interest or guarantee or other document or agreement which the Vendor or another person
may hold concerning the Guaranteed Obligations.

	10.4  	Enforcement against Guarantor
	 
	   	The Vendor may enforce this clause 10 against the Guarantor without first having to
resort to another guarantee or security interest or other agreement relating to the
Guaranteed Obligations.

	10.5  	Reinstatement of guarantee and indemnity
	 
	   	If any payment or other transaction in connection with the Guaranteed Obligations or
this clause 10 is or becomes void, voidable, unenforceable or defective or a claim of such
is upheld or settled (each an Avoidance), then:

	 	(a)  	the Guarantor’s liability will continue, and be what it would have been had the
Avoidance not occurred; and
	 
	 	(b)  	the Guarantor must execute and do everything necessary to restore the Vendor to
its position immediately before the Avoidance.

			
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	11.  	Notices and other communications
	 
	11.1  	Service of notices
	 
	   	A notice, demand, consent, approval or communication under this agreement (Notice) must
be:

	 	(a)  	in writing, in English and signed by a person duly authorised by the sender;
and
	 
	 	(b)  	hand delivered or sent by prepaid post or facsimile to the recipient’s address
for Notices specified in the Details, as varied by any Notice given by the recipient to
the sender.

	11.2  	Effective on receipt
	 
	   	A Notice given in accordance with clause 11.1 takes effect when taken to be received
(or at a later time specified in it), and is taken to be received:

	 	(a)  	if hand delivered, on delivery;
	 
	 	(b)  	if sent by prepaid post, the second Business Days after the date of posting (or
the seventh Business Day after the date of posting if posted to or from a place outside
Australia);
	 
	 	(c)  	if sent by facsimile, when the sender’s facsimile system generates a message
confirming successful transmission of the entire Notice unless, within eight Business
Hours after the transmission, the recipient informs the sender that it has not received
the entire Notice,
	 
	 	   	but if the delivery, receipt or transmission is not on a Business Day or is after 5.00pm on
a Business Day, the Notice is taken to be received at 9.00am on the next Business Day.

	12.  	Miscellaneous
	 
	12.1  	Alterations
	 
	   	This agreement may be altered only in writing signed by each party.

	 
	12.2   	
Approvals and consents
	 
	   	Except where this agreement expressly states otherwise, a party may, in its discretion,
give conditionally or unconditionally or withhold any approval or consent under this
agreement.
	 
	12.3  	Assignment
	 
	   	A party may only assign this agreement or a right under this agreement with the prior
written consent of each other party.
	 
	12.4  	Costs
	 
	   	Each party must pay its own costs of negotiating, preparing and executing this agreement.

	 
	12.5  	
Stamp duty
	 
	   	Any stamp duty, duties or other taxes of a similar nature (including fines, penalties
and interest) in connection with this agreement or any transaction contemplated by this
agreement, must be paid by the Purchaser.
	 
	12.6  	Survival
	 
	   	Any indemnity or any obligation of confidence under this agreement is independent and
survives termination of this agreement. Any other term by its nature intended to survive
termination of this agreement survives termination of this agreement.

			
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	12.7  	Counterparts
	 
	   	This agreement may be executed in counterparts. All executed counterparts constitute
one document.
	 
	12.8  	No merger
	 
	   	The rights and obligations of the parties under this agreement do not merge on
completion of any transaction contemplated by this agreement.
	 
	12.9  	Entire agreement
	 
	   	This agreement, together with the Transaction Documents, constitutes the entire
agreement between the parties in connection with its subject matter and supersedes all
previous agreements or understandings between the parties in connection with its subject
matter, including the memorandum of understanding between the Company, Stemcor Australia Pty
Limited and the Vendor, dated 1 December 2004.
	 
	12.10  	Further action
	 
	   	Each party must do, at its own expense, everything reasonably necessary (including
executing documents) to give full effect to this agreement and any transactions contemplated
by it.
	 
	12.11  	Severability
	 
	   	A term or part of a term of this agreement that is illegal or unenforceable may be
severed from this agreement and the remaining terms or parts of the term of this agreement
continue in force.
	 
	12.12  	Waiver
	 
	   	A party does not waive a right, power or remedy if it fails to exercise or delays in
exercising the right, power or remedy. A single or partial exercise of a right, power or
remedy does not prevent another or further exercise of that or another right, power or
remedy. A waiver of a right, power or remedy must be in writing and signed by the party
giving the waiver.
	 
	12.13  	Relationship
	 
	   	Except where this agreement expressly states otherwise, it does not create a
relationship of employment, trust, agency or partnership between the parties.
	 
	12.14  	Governing law and jurisdiction
	 
	   	This agreement is governed by the law of New South Wales and each party irrevocably and
unconditionally submits to the non-exclusive jurisdiction of the courts of New South Wales.

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 22

 

 

Schedule 1  — Arbutus Agreement

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 23

 

 

Schedule 2 — Beviron Agreement

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 24

 

 

Schedule 3 — Deed of Assignment

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 25

 

 

	 	 	 
	Signing page
	 	 
	

	 
	 	 
	EXECUTED as an agreement.
	 	 
	 
	 	 
	Executed by Ivanhoe Mines Ltd. by its attorney
Sebastian Hempel under power of attorney dated 3
February 2005 in the presence of
	 	 
	 
	 	 
	“Angus Davison”

	 	“Sebastian Hempel”
	 

	 	 
	Signature of witness

	 	Sebastian Hempel
	 
	 	 
	Angus Davison
	 	 
	

	 	 
	Name of witness (print)
	 	 
	 
	 	 
	Executed by Stemcor Pellets Ltd by its attorneys
Paul Whitehead and Thomas Girgensohn under power of
attorney dated 3 February 2005 in the presence of
	 	 
	 
	 	 
	“T. Girgensohn”

	 	“Paul Whitehead”
	 

	 	 
	Signature of witness

	 	Paul Whitehead
	 
	 	 
	T. Girgensohn
	 	 
	 

	 	 
	Name of witness (print)

	 	Thomas Girgensohn
	 
	 	 
	Executed by Dominant Holdings AG by its attorneys
Paul Whitehead  under power of
attorney dated 3 February 2005 in the presence of
	 	 
	 
	 	 
	“T. Girgensohn”

	 	“Paul Whitehead”
	 

	 	 
	Signature of witness

	 	Paul Whitehead
	 
	 	 
	T. Girgensohn
	 	 
	 

	 	 
	Name of witness (print)

	 	Thomas Girgensohn
	 
	 	 
	Executed by Stemcor Holdings Limited by its
attorneys Paul Whitehead and Thomas Girgensohn under
power of attorney dated 3 February 2005 in the presence
of
	 	 
	 
	 	 
	“T. Girgensohn”

	 	“Paul Whitehead”
	 

	 	 
	Signature of witness

	 	Paul Whitehead
	 
	 	 
	T. Girgensohn
	 	 
	 

	 	 
	Name of witness (print)

	 	Thomas Girgensohn

			
	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Head Agreement | page 26exv10w5

 

Exhibit 10.5

	 	 	 
	

	 	Share sale agreement
	 
	 	 
	

	 	relating to shares in Beviron Pty Limited
	

	 	ACN 078 197 323
	 
	 	 
	

	 	

	 
	 	 
	

	 	Ivanhoe Mines Ltd. (Vendor)
	 
	 	 
	

	 	Stemcor Pellets Ltd (Purchaser)

	 	 	 
	 

	 	
	

	 	AURORA PLACE, 88 PHILLIP STREET, SYDNEY NSW 2000, DX 117 SYDNEY
	

	 	TEL: +61 2 9921 8888 FAX: +61 2 9921 8123
	

	 	www.minterellison.com

 

 

Share sale agreement

	 	 	 	 	 	 	 
	Details	 	 	4	 
	 
	 	 	 	 	 	 
	Agreed terms	 	 	5	 
	 
	 	 	 	 	 	 
	1.
	 	Defined terms & interpretation	 	 	5	 
	 
	 	 	 	 	 	 
	1.1
	 	Defined terms from Head Agreement	 	 	5	 
	1.2
	 	Defined terms	 	 	5	 
	1.3
	 	Interpretation	 	 	7	 
	1.4
	 	Headings	 	 	8	 
	 
	 	 	 	 	 	 
	2.
	 	Conditions	 	 	8	 
	 
	 	 	 	 	 	 
	2.1
	 	Conditions	 	 	8	 
	2.2
	 	Waiver of Conditions	 	 	10	 
	2.3
	 	Conduct of the parties	 	 	10	 
	2.4
	 	Failure of Condition	 	 	10	 
	 
	 	 	 	 	 	 
	3.
	 	Sale and purchase	 	 	10	 
	 
	 	 	 	 	 	 
	4.
	 	Purchase Price	 	 	10	 
	 
	 	 	 	 	 	 
	4.1
	 	Amount	 	 	10	 
	4.2
	 	Payment of the Purchase Price	 	 	10	 
	 
	 	 	 	 	 	 
	5.
	 	Completion	 	 	10	 
	 
	 	 	 	 	 	 
	5.1
	 	Time and place	 	 	10	 
	5.2
	 	Obligations of the Vendor	 	 	10	 
	5.3
	 	Obligations of the Purchaser	 	 	11	 
	5.4
	 	Simultaneous actions at Completion	 	 	11	 
	5.5
	 	Effect of failure to deliver by Vendor	 	 	11	 
	5.6
	 	Effect of failure to deliver by Purchaser	 	 	12	 
	5.7
	 	Records	 	 	12	 
	5.8
	 	Proxy and address for notices	 	 	12	 
	 
	 	 	 	 	 	 
	6.
	 	Obligations before Completion	 	 	12	 
	 
	 	 	 	 	 	 
	6.1
	 	Continuity of Business	 	 	12	 
	6.2
	 	Access to Business and Records	 	 	12	 
	6.3
	 	Purchaser's obligations	 	 	12	 
	6.4
	 	Right to copy and consult	 	 	12	 
	 
	 	 	 	 	 	 
	7.
	 	Release of Guarantees	 	 	13	 
	 
	 	 	 	 	 	 
	8.
	 	Warranties by the Vendor	 	 	13	 
	 
	 	 	 	 	 	 
	8.1
	 	Warranties	 	 	13	 
	8.2
	 	Application of the Warranties	 	 	13	 
	8.3
	 	Qualifications	 	 	13	 
	8.4
	 	Acknowledgments	 	 	13	 
	8.5
	 	Financial limits on Claims	 	 	14	 
	8.6
	 	Time limits on Claims	 	 	14	 
	8.7
	 	Other limits on Claims	 	 	14	 
	8.8
	 	Maximum aggregate liability for Claims	 	 	15	 
	8.9
	 	Transaction Consideration not known	 	 	15	 
	8.10
	 	Vendor Indemnity where Transaction Consideration not known	 	 	15	 

			
	 	 	 
	

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	8.11
	 	Vendor Indemnity where Transaction Consideration not known	 	 	15	 
	8.12
	 	Exclusions of limitations	 	 	15	 
	8.13
	 	Notice of potential Claim	 	 	15	 
	8.14
	 	Conduct of third party Claims	 	 	16	 
	8.15
	 	Rights of the Purchaser	 	 	16	 
	8.16
	 	Costs indemnity	 	 	16	 
	8.17
	 	Security for costs	 	 	17	 
	8.18
	 	Warranty payments	 	 	17	 
	8.19
	 	Benefits or credits received by the Company or the Purchaser	 	 	17	 
	8.20
	 	Meaning of Vendor’s knowledge	 	 	17	 
	8.21
	 	Taxation indemnity	 	 	18	 
	8.22
	 	Trade Practices Act	 	 	18	 
	8.23
	 	Financial forecasts	 	 	18	 
	 
	 	 	 	 	 	 
	9.
	 	GST	 	 	18	 
	 
	 	 	 	 	 	 
	9.1
	 	Interpretation	 	 	18	 
	9.2
	 	GST gross up	 	 	18	 
	9.3
	 	Reimbursements	 	 	18	 
	9.4
	 	Tax invoice	 	 	19	 
	 
	 	 	 	 	 	 
	10.
	 	Notices and other communications	 	 	19	 
	 
	 	 	 	 	 	 
	10.1
	 	Service of notices	 	 	19	 
	10.2
	 	Effective on receipt	 	 	19	 
	 
	 	 	 	 	 	 
	11.
	 	Miscellaneous	 	 	19	 
	 
	 	 	 	 	 	 
	11.1
	 	Alterations	 	 	19	 
	11.2
	 	Approvals and consents	 	 	19	 
	11.3
	 	Assignment	 	 	19	 
	11.4
	 	Costs	 	 	19	 
	11.5
	 	Stamp duty	 	 	19	 
	11.6
	 	Survival	 	 	20	 
	11.7
	 	Counterparts	 	 	20	 
	11.8
	 	No merger	 	 	20	 
	11.9
	 	Entire agreement	 	 	20	 
	11.10
	 	Further action	 	 	20	 
	11.11
	 	Severability	 	 	20	 
	11.12
	 	Waiver	 	 	20	 
	11.13
	 	Relationship	 	 	20	 
	11.14
	 	Governing law and jurisdiction	 	 	20	 
	 
	 	 	 	 	 	 
	Schedule 1 - Details of the Company and the Subsidiary	 	 	21	 
	 
	 	 	 	 	 	 
	Schedule 2 - Warranties	 	 	22	 
	 
	 	 	 	 	 	 
	Schedule 3 - Properties	 	 	37	 
	 
	 	 	 	 	 	 
	Signing page	 	 	39	 

			
	 	 	 
	

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	 	Beviron Share Sale Agreement | page 3
	 	 	 

 

 

Details

	 	 	 
	Date
	 	 
	 
	 	 
	Parties
	 	 
	 
	 	 
	Name

	 	Ivanhoe Mines Ltd. ARBN 075 217 097
	Short form name

	 	Vendor
	Notice details

	 	Suite 654, 999 Canada Place, Vancouver, British Columbia V6C 3E1, Canada

Facsimile +1 604 682 6728

Attention Peter Meredith
	 
	 	 
	Name

	 	Stemcor Pellets Ltd registered number 2188847
	Short form name

	 	Purchaser
	Notice details

	 	Level 27, City Point, 1 Ropemaker Street, London

EC2Y9ST, United Kingdom

Facsimile +44 20 7775 3679

Attention Company Secretary

Background

	 	 	 
	A

	 	The Shares are, or will be, legally and beneficially owned by the Vendor.
	 
	 	 
	B

	 	The Vendor has agreed to sell and the Purchaser has agreed to purchase the Shares on the terms and conditions set
out in this agreement.

			
	 	 	 
	

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	 	Beviron Share Sale Agreement | page 4
	 	 	 

 

 

Agreed terms

	1.  	Defined terms & interpretation
	 
	1.1  	Defined terms from Head Agreement
	 
	   	Terms defined in the Head Agreement have the same meanings when used in this document
unless otherwise defined in this document.
	 
	1.2  	Defined terms
	 
	   	In this agreement:
	 
	   	Accounts means the audited balance sheet of the Company and the Subsidiary as at the
Accounts Date and the audited profit and loss statement and statement of cash flows of the
Company and the Subsidiary for the financial year ending on the Accounts Date together with
the notes to, and the reports of the directors in respect of, those accounts.
	 
	   	Accounts Date means 31 December 2003.
	 
	   	Arbutus means Arbutus Holding Ltd., a company incorporated in the British Virgin
Islands, registration number 497003, which has its registered address at c/- Midocean
Management and Trust Services (BVI) Limited, 9 Columbus Centre, Road Town, Tortola in the
British Virgin Islands.
	 
	   	Business means the businesses carried on by the Group as at the date of this agreement,
including the business of mining iron ore in the area known as Savage River and the
production of iron ore pellets in Tasmania in Australia carried on under the business name
‘Australian Bulk Minerals’ and includes all licences, authorities, plant and equipment used
in connection with those activities and whose principal place of business is 58-60 Wilmot
Street, Burnie, Tasmania, 7320, Australia.
	 
	   	Claim includes a claim, notice, demand, action, proceeding, litigation, investigation,
judgment, damage, loss, cost, expense or liability however arising, whether present,
unascertained, immediate, future or contingent, whether based in contract, tort or statute
and whether involving a third party or a party to this agreement.
	 
	   	Company means Beviron Pty Limited ACN 078 197 323, further details of which are set out
in Part A of Schedule 1.
	 
	   	Completion means completion of the sale and purchase of the Shares contemplated by this
agreement.
	 
	   	Completion Date means 28 February 2005 provided that all the Conditions have been
fulfilled (or waived under clause 2.2) or, in the event that all the Conditions have not
been fulfilled (or waived under clause 2.2) before 28 February 2005, the fifth Business Day
after the date on which all the Conditions have been fulfilled (or waived under clause 2.2).
	 
	   	Conditions means the conditions set out in clause 2.1.
	 
	   	Costs Assessor means a costs assessor appointed under clause 8.17.
	 
	   	Disclosure Letter means the letter from the Vendor to the Purchaser of the same date as
this agreement entitled ‘Disclosure Letter’.
	 
	   	Due Diligence Material means the information and documents provided to the Purchaser
before the date of this agreement, a list of which is attached to the Disclosure Letter.

			
	 	 	 
	

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	 	Beviron Share Sale Agreement | page 5
	 	 	 

 

 

	   	Encumbrance includes any:

	 	(a)  	security for the payment of money or performance of obligations, including a
mortgage, charge, lien, pledge or trust;
	 
	 	(b)  	right, interest or arrangement which has the effect of giving another person a
preference, priority or advantage over creditors including any right of set-off;
	 
	 	(c)  	notice or direction under sections 218 or 255 of the Income Tax Assessment Act
1936 (Cwlth) or under section 74 of the Sales Tax Assessment Act 1992 (Cwlth) or under
section 260-5 of the Taxation Administration Act 1953 (Cwlth) or under any provision of
any law which has a similar effect;
	 
	 	(d)  	right that a person (other than the owner) has to remove something from land
(known as a profit à pendre), easement, public right of way, restrictive or positive
covenant, lease, or licence to use or occupy; or
	 
	 	(e)  	third party right or interest or any right arising as a consequence of the
enforcement of a judgment,

	  	or any agreement to create any of them or allow them to exist.
	 
	   	Goldamere Agreement means the agreement between the Crown, the Subsidiary and Ivanhoe
Capital Limited dated 26 September 1996 as ratified and approved by the Goldamere Act.
	 
	   	Goldamere Deed means the deed between the Subsidiary and the Crown dated 10 December 1996 as
amended.
	 
	   	Governmental Authority includes any governmental, semi-governmental, municipal or
statutory authority, instrumentality, organisation, body or delegate (including without
limitation any town planning or development authority, public utility, environmental,
building, health, safety or other body or authority) having jurisdiction, authority or power
over or in respect of the Company, the Subsidiary, the Business or the Properties.
	 
	   	Group means the Company and the Subsidiary.
	 
	   	Group Company means any of the Company and the Subsidiary.
	 
	   	Head Agreement means the agreement so entitled and dated 4 February 2005 between the Vendor,
the Purchaser, Dominant Holdings AG and Stemcor Holdings Ltd.
	 
	   	Liabilities includes all liabilities (whether actual, contingent or prospective),
losses, damages, costs and expenses of whatever description.
	 
	   	Properties means the real property (whether leasehold or freehold) listed in Schedule
3.
	 
	   	Purchase Price means the amount payable under clause 4.
	 
	   	Records means all original and copy records, documents, books, files, reports,
accounts, plans, correspondence, letters and papers of every description and other material
regardless of their form or medium and whether coming into existence before, on or after the
date of this agreement, belonging or relating to or used by any Group Company including
(without limitation) certificates of registration, minute books, statutory books and
registers, books of account, Tax returns, title deeds and other documents of title, customer
lists, price lists, computer programs and software, and trading and financial records.
	 
	   	Related Party Debt Amending Agreement means the document so entitled dated 6 November
2000 between (among others) the Company, the Subsidiary, the Vendor, Ivanhoe Capital Finance
Limited and Robert M. Friedland.
	 
	   	Security means an amount to be paid to the Claimee in accordance with clause 8.17.

			
	 	 	 
	

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	 	Beviron Share Sale Agreement | page 6
	 	 	 

 

 

	   	Shares means all of the shares in the share capital of the Company.
	 
	   	Subsidiary means Goldamere Pty Limited ACN 073 634 581, further details of which are
set out in Part B of Schedule 1.
	 
	   	Tax means all forms of taxes, duties, imposts, charges, withholdings, rates, levies or
other governmental impositions of whatever nature and by whatever authority imposed,
assessed or charged together with all costs, charges, interest, penalties, fines, expenses
and other additional statutory charges, incidental or related to the imposition.
	 
	   	Warranties means each of the representations and warranties given under clause 8 and
set out in Schedule 2.
	 
	1.3  	Interpretation
	 
	   	In this agreement, except where the context otherwise requires:

	 	(a)  	the singular includes the plural and vice versa, and a gender includes other
genders;
	 
	 	(b)  	another grammatical form of a defined word or expression has a corresponding
meaning;
	 
	 	(c)  	a reference to a clause, paragraph, schedule or annexure is to a clause or
paragraph of, or schedule or annexure to, this agreement, and a reference to this
agreement includes any schedule or annexure;
	 
	 	(d)  	a reference to a document or instrument includes the document or instrument as
novated, altered, supplemented or replaced from time to time;
	 
	 	(e)  	a reference to A$, $A or AUD is to Australian currency;
	 
	 	(f)  	a reference to US$, $US or USD is to United States currency;
	 
	 	(g)  	a reference to time is to Sydney, Australia time;
	 
	 	(h)  	a reference to a party is to a party to this agreement, and a reference to a
party to a document includes the party’s executors, administrators, successors and
permitted assigns and substitutes;
	 
	 	(i)  	a reference to a person includes a natural person, partnership, body corporate,
association, governmental or local authority or agency or other entity;
	 
	 	(j)  	a reference to a statute, ordinance, code or other law includes regulations and
other instruments under it and consolidations, amendments, re-enactments or
replacements of any of them;
	 
	 	(k)  	a word or expression defined in the Corporations Act has the meaning given to
it in the Corporations Act;
	 
	 	(l)  	the meaning of general words is not limited by specific examples introduced by
including, for example or similar expressions;
	 
	 	(m)  	any agreement, representation, warranty or indemnity by two or more parties
(including where two or more persons are included in the same defined term) binds them
jointly and severally;
	 
	 	(n)  	any agreement, representation, warranty or indemnity in favour of two or more
parties (including where two or more persons are included in the same defined term) is
for the benefit of them jointly and severally;
	 
	 	(o)  	a rule of construction does not apply to the disadvantage of a party because
the party was responsible for the preparation of this agreement or any part of it; and

			
	 	 	 
	

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	 	Beviron Share Sale Agreement | page 7
	 	 	 

 

 

	 	(p)  	if a day on or by which an obligation must be performed or an event must occur
is not a Business Day, the obligation must be performed or the event must occur on or
by the next Business Day.
	 
	 	(q)  	a reference to except as disclosed is to something disclosed in this agreement
or the Disclosure Letter.

	1.4  	Headings
	 
	   	Headings are for ease of reference only and do not affect interpretation.
	 
	2.  	Conditions
	 
	2.1  	Conditions
	 
	   	Completion must not occur until all of the following Conditions are fulfilled:

	 	 	 
	 	 	Party entitled to
	Condition	 	benefit
	Under the Foreign Acquisitions and Takeovers Act
1975 (Cth) (FATA), the Treasurer of the Commonwealth of
Australia consents to the transfer of the Shares
contemplated by this agreement. If that consent is
given subject to conditions or requirements, this
Condition is not fulfilled unless those conditions or
requirements are reasonably acceptable to the Purchaser
and the Vendor.

	 	The Purchaser and
the Vendor
	 
	 	 
	For the purpose of this Condition, the Treasurer will
be taken to have consented to the transfer of the
Shares under this agreement if:
	 	 
	 
	 	 
	(a) the Treasurer issues a notice under the FATA
stating that the Commonwealth Government does not
object to the transfer of the Shares; or
	 	 
	 
	 	 
	(b) the Treasurer is, by reason of lapse of time, not
empowered to make an order under the FATA in relation
to the transfer of the Shares.
	 	 
	

	Societe Generale ABN 71 092 516 286 as ‘Party A’ under
the ISDA Master Agreement between the Company and
Societe Generale, dated 20 August 2004, consents in
writing to the sale and purchase of the Shares and all
other applicable transactions contemplated by this
agreement (including a written waiver by Societe
Generale from compliance by any person with any
provision of the ISDA Master Agreement that would
otherwise be breached by the transactions or the
execution of this agreement) either:

	 	The Vendor and the Purchaser
	 
	 	 
	(a) without conditions or requirements; or
	 	 
	 
	 	 
	(b) with conditions and requirements that are
acceptable to the Vendor and (to the extent that they
affect the Purchaser or the Group) to the Purchaser.
	 	 
	

	Any interest that Goldamere has in the Goldamere
Agreement and the Goldamere Deed being excluded from
the definition of ‘Charged Property’ in the Deed of
Mortgage and Charge between Goldamere and Societe
Generale ABN 71 092 516 286 dated 20 August 2004 and
registered under Part 2K.2 of the Corporations Act
number 1075371.

	 	The Vendor

			
	 	 	 
	

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	 	Beviron Share Sale Agreement | page 8
	 	 	 

 

 

	 	 	 
	

	All other consents necessary or relevant for the sale
and purchase of the Shares contemplated by this
agreement to take place without breaching any statute
or agreement are granted and received either:

	 	The Vendor and the Purchaser
	 
	 	 
	(a) without conditions or requirements; or
	 	 
	 
	 	 
	(b) with conditions and requirements that are
acceptable to the Vendor and (to the extent that they
affect the Purchaser or the Group) to the Purchaser.
	 	 
	

	The prior completion of the Deed of Assignment with
Deeds of Acknowledgment (as that term is defined in
clause 1.2 of the Deed of Assignment) in a form
reasonably agreed between the parties to the Deed of
Assignment.

	 	The Purchaser and the Vendor
	

	The contemporaneous completion of the Arbutus Agreement.

	 	The Purchaser and
The Vendor
	

	The Goldamere Agreement and Goldamere Deed remains in
full force and effect including consent to the change
in control of the Subsidiary and finance arrangements
regarding the Subsidiary.

	 	The Purchaser
	

	There being no actual or threatened revocation,
termination or suspension of Mining Lease 2M/2001
granted under the Mineral Resources Development Act
1995 (Tasmania).

	 	The Purchaser
	

	There being no actual or threatened revocation,
termination or suspension of the Goldamere Agreement or
the Goldamere Deed.

	 	The Purchaser
	

	Written consent being provided by Alinta EATM Pty Ltd,
pursuant to clause 18.2 of the gas sale agreement
between Alinta EATM Pty Ltd and the Subsidiary (Gas
Sale Agreement), to the ‘deemed assignment’ (as defined
in clause 18.4 of the Gas Sale Agreement) of the
Subsidiary’s interest under the Gas Sale Agreement
without any conditions or any requirement for the
provision of security.

	 	The Purchaser
	

	Each employee of the Subsidiary who under their terms
of employment with the Subsidiary has been offered any
interest in a Group Company, the Vendor or any related
body corporate of the Vendor (as defined in section 50
of the Corporations Act) releases the Subsidiary from
any obligation to grant or issue, or procure the grant
or issue, of that interest.

	 	The Purchaser
	

	Termination of the management services agreement
between the Subsidiary and Ivanhoe Capital Pte Ltd
dated 1 January 2001 with no liability to the
Subsidiary, the execution of a deed of release pursuant
to which the amount of US$419,710.94 outstanding from
the Subsidiary to Ivanhoe Capital Pte Ltd is forgiven
and written confirmation that no amounts are owing by
the Subsidiary to Ivanhoe Capital Pte Ltd.

	 	The Purchaser
	

	The acknowledgment by the Vendor in a form reasonably
acceptable to the Purchaser that there is no obligation
for the Company to pay the Vendor any amount in respect
of the deposit referred to in the Deed Poll granted by
Ivanhoe Cloncurry Mines Pty Limited in favour of the
Company, dated 23 December 2004.

	 	The Purchaser
	

	Confirmation that the financial interest of UBS
Australia Limited is removed from the water licence
issued by the Tasmanian Department of

	 	The Purchaser
	

			
	 	 	 
	

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	Primary Industries Water and Energy (license number 7075) and
replaced with the financial interest of Arbutus
Holdings Ltd.
	 	 
	

	Evidence that clause 4.3 of the Related Party Debt
Amending Agreement has been amended or deleted as
required by the Purchaser.

	 	The Purchaser
	

	2.2  	Waiver of Conditions
	 
	   	A Condition may only be waived in writing by each party entitled to the benefit of that
Condition (as specified in relation to each Condition in the second column of the table in
clause 2.1) and will be effective only to the extent specifically set out in that waiver.
	 
	2.3  	Conduct of the parties
	 
	   	Each party must use all reasonable efforts within its own capacity to ensure that each
Condition is fulfilled before 5.00pm on 25 February 2005.
	 
	2.4  	Failure of Condition
	 
	   	If a party has complied with its obligations under clause 2.3, it may terminate this
agreement by giving notice in writing to the other parties if one or more Conditions are not
fulfilled by 5.00pm on 25 February 2005 or another date agreed by the parties in writing.
	 
	3.  	Sale and purchase
	 
	   	The Vendor as current or future beneficial owner agrees to sell to the Purchaser and
the Purchaser agrees to buy from the Vendor the Shares:

	 	(a)  	for the Purchase Price;
	 
	 	(b)  	free from Encumbrances;
	 
	 	(c)  	with all rights, including dividend and voting rights, attached or accrued to
them on or after the date of this agreement; and
	 
	 	(d)  	subject to this agreement.

	4.  	Purchase Price
	 
	4.1  	Amount
	 
	   	The Purchase Price for the Shares is the Beviron Consideration.

	 
	4.2  	
 Payment of the Purchase Price
	 
	   	The Purchaser must pay the Purchase Price in accordance with clause 3 of the Head
Agreement.
	 
	5.  	Completion
	 
	5.1  	Time and place
	 
	   	If all the Conditions have been fulfilled or waived under clause 2.2, Completion will
take place at 10:00am on the Completion Date at the offices of Minter Ellison at Level 19,
88 Phillip Street, Sydney or another time and place agreed by the parties.
	 
	5.2  	Obligations of the Vendor
	 
	   	At or before Completion, the Vendor must:

			
	 	 	 
	

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	 	(a)  	deliver to the Purchaser a duly executed and completed transfer in favour of
the Purchaser of the Shares in registrable form (except for the impression of stamp
duty or other taxes of a similar nature) together with the relevant share certificates;
	 
	 	(b)  	produce to the Purchaser any power of attorney or other authority under which
the transfer of the Shares is executed;
	 
	 	(c)  	deliver to the Purchaser duly executed instruments irrevocably waiving in
favour of the Purchaser all rights of pre-emption which any person has in respect of
any of the Shares;
	 
	 	(d)  	deliver to the Purchaser copies of any other consents and waivers required
under clause 2;
	 
	 	(e)  	cause the board of directors of the Company to resolve that the transfer of the
Shares (subject only to the payment of stamp duty or other taxes of a similar nature on
the transfers) be approved and registered;
	 
	 	(f)  	cause the board of directors of the Company to resolve to appoint as directors
of the Group Companies those individuals in respect of who the Purchaser has delivered
to a Group Company a consent to act as a director of the Group Company;
	 
	 	(g)  	deliver the resignation of directors of the Group Companies nominated by the
Purchaser prior to Completion and their acknowledgement that they have received all
entitlements to which they are entitled up to the date of the resignation and have no
further claim against the Group Company;
	 
	 	(h)  	deliver to the Purchaser all Records in its possession (other than those which
the Vendor is entitled to retain under clause 5.7);
	 
	 	(i)  	deliver to the Purchaser an irrevocable appointment by the Vendor of the
Purchaser as its sole proxy to attend and vote at meetings of the Company;
	 
	 	(j)  	deliver to the Purchaser an irrevocable notice of change of address of the
Vendor for service of notices and correspondence by the Company to Suite 2, Level 13,
15 Blue Street North Sydney, NSW 2060;
	 
	 	(k)  	deliver to the Purchaser the common seal (if any) of each Group Company; and
	 
	 	(l)  	do all other things necessary or desirable to transfer the Shares, to complete
any other transaction contemplated by this agreement and to place the Purchaser in
effective control of the Group and the Business.

	5.3  	Obligations of the Purchaser
	 
	   	The Purchaser must, at or before Completion, deliver to the Vendor any consents or
waivers required under clause 2.
	 
	5.4  	Simultaneous actions at Completion
	 
	   	In respect of Completion:

	 	(a)  	the obligations of the parties under this agreement are interdependent;
	 
	 	(b)  	all actions required to be performed will be taken to have occurred
simultaneously on the Completion Date; and
	 
	 	(c)  	the Purchaser need not complete the purchase of any of the Shares unless the
purchase of all the Shares is completed simultaneously.

	5.5  	Effect of failure to deliver by Vendor
	 
	   	If the Vendor fails to deliver any items which are due from it on Completion by the
date of Completion, the Purchaser is entitled to terminate this document on giving 14 days
prior written

			
	 	 	 
	

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	 	Beviron Share Sale Agreement | page 11
	 	 	 

 

 

	   	notice to the Vendor. Termination does not affect any other rights which the Purchaser may
have. If the Vendor is able in the notice period to deliver the items in question then
Completion must be reconvened to allow it to do so.
	 
	5.6  	Effect of failure to deliver by Purchaser
	 
	   	If the Purchaser fails to deliver any items which are due from it on Completion by the
date of Completion, the Vendor is entitled to terminate this document on giving 14 days
prior written notice to the Purchaser. Termination does not affect any other rights which
the Vendor may have. If the Purchaser is able in the notice period to deliver the items in
question then Completion must be reconvened to allow it to do so.
	 
	5.7  	Records
	 
	   	The Vendor may retain after Completion copies of any Records necessary for it to comply
with any applicable law (including, without limitation, any applicable Tax law) and to
prepare Tax or other returns required of it by law.
	 
	5.8  	Proxy and address for notices
	 
	   	While the Vendor remains the registered holder of any of the Shares, the Vendor must:

	 	(a)  	not attend or vote at meetings of the Company except through the Purchaser as
its proxy;
	 
	 	(b)  	do everything else that it may do in the capacity of registered holder of the
Shares, including dealing with the Shares, and with any distribution, property or right
derived from them, in accordance with the Purchaser’s directions; and
	 
	 	(c)  	not change its address for service of notices or any correspondence by the
Company from the address of the Purchaser.

	6.  	Obligations before Completion
	 
	6.1  	Continuity of Business
	 
	   	Until Completion, the Vendor must not, and the Vendor must procure that the Subsidiary
does not, do anything other than carry on the Business in the ordinary course.
	 
	6.2  	Access to Business and Records
	 
	   	The Vendor will allow the Purchaser, its employees, agents and representatives
reasonable access to the Properties and the Records at all reasonable times before
Completion to enable the Purchaser, as is reasonably necessary, to:

	 	(a)  	become familiar with the Business and the affairs of the Group; and
	 
	 	(b)  	investigate the accuracy of the Warranties.

	6.3  	Purchaser’s obligations
	 
	   	The Purchaser must ensure that any access under clause 6.2 is exercised and conducted
in a manner to avoid unreasonable disruption to the conduct of the Business and the
activities and operations of the Group and its employees.
	 
	6.4  	Right to copy and consult
	 
	   	For the purposes of clause 6.2, the Purchaser may:

	 	(a)  	make copies of material examined;
	 
	 	(b)  	consult with the officers of the Group Companies; and

			
	 	 	 
	

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	 	(c)  	with the prior consent of the Vendor (which consent may not be unreasonably
withheld), consult with employees of the Group.

	7.  	Release of Guarantees
	 
	   	The Purchaser:

	 	(a)  	must, at the request of the Vendor at any time either before or after
Completion, use its reasonable efforts to procure the release of the Vendor and its
Associates from any other guarantee or security given before Completion by the Vendor
or its Associates in relation to the obligations of a Group Company; and
	 
	 	(b)  	indemnifies the Vendor and its Associates from and against any Claim or
Liability arising out of any guarantees or securities referred to in paragraph 7(a)
that may be suffered or incurred by the Vendor or any of its Associates which relates
to events or circumstances occurring after Completion.

	   	The obligation under this clause 7 applies only in relation to guarantees or securities
where the guaranteed or secured amount does not exceed A$20,000.
	 
	8.  	Warranties by the Vendor
	 
	8.1  	Warranties
	 
	   	The Vendor represents and warrants to the Purchaser that each of the Warranties is true
and accurate at the date of this agreement and will be true and accurate on the Completion
Date.
	 
	8.2  	Application of the Warranties
	 
	   	Each of the Warranties:

	 	(a)  	remains in full force and effect after Completion;
	 
	 	(b)  	is separate and independent and is not limited by reference to any other
Warranty; and
	 
	 	(c)  	applies in relation to the Company and also, except where expressly otherwise
provided, separately in relation to the Subsidiary, as if each reference in Schedule 2
to the Company were a reference the Subsidiary.

	8.3  	Qualifications
	 
	   	The Warranties are given subject to and qualified by, and the Purchaser is not entitled
to claim that any fact, matter or circumstance causes any of the Warranties to be breached
if and to the extent, but only to the extent, that the fact, matter or circumstance is
fairly disclosed in:

	 	(a)  	this agreement;
	 
	 	(b)  	the Disclosure Letter;
	 
	 	(c)  	the Due Diligence Materials; or
	 
	 	(d)  	any information available, on or before the date that is five (5) Business Days
before the date of this agreement, on public registers maintained by any of the Trade
Marks Office, the High Court of Australia, the Tasmanian Registry of the Federal Court,
the Supreme Court of Tasmania, the Tasmanian Office of the Recorder of Titles and the
Australian Securities and Investments Commission.

	8.4  	Acknowledgments
	 
	   	The Purchaser acknowledges and agrees with the Vendor that:

			
	 	 	 
	

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	 	(a)  	the Warranties are the only warranties that the Purchaser requires, and on
which the Purchaser has relied, in entering into this agreement;
	 
	 	(b)  	for the avoidance of doubt, no warranty or representation, expressed or
implied, is given in relation to any expression of intention or expectation nor any
forecast, budget or projection contained or referred to in the Due Diligence Material;
and
	 
	 	(c)  	to the extent permitted by law, all other warranties, representations and
undertakings (whether express or implied and whether oral or in writing) made or given
by any entity which is a Group Company or their respective employees, customers, agents
or representatives are expressly excluded.

	8.5  	Financial limits on Claims
	 
	   	The Vendor has no liability for a Claim for a breach of any Warranty:

	 	(a)  	unless the amount of the Claim in respect of that breach is US$100,000 or more;
and
	 
	 	(b)  	until the aggregate of all Claims of US$100,000 or more for breach of the
Warranties under this agreement exceeds US$1,000,000, in which event the Purchaser may
claim the whole amount.

	8.6  	Time limits on Claims
	 
	   	Subject to clause 8.12 the Vendor has no liability for breach of any Warranty unless:

	 	(a)  	in the case of a Claim relating to any Warranty other than Warranty 12, the
Purchaser has given written notice of the Claim to the Vendor under clause 8.13 on or
before the date being 15 months after the Completion Date;
	 
	 	(b)  	in the case of a Claim relating to Warranty 12 the Purchaser has given written
notice of the Claim to the Vendor under clause 8.13 on or before the seventh
anniversary of the Completion Date; and
	 
	 	(c)  	in either case, unless the Claim has been settled or legal proceedings in a
court of competent jurisdiction in respect of the Claim have been commenced by the
Purchaser against the Vendor within 1 year of the Claim being notified by the Purchaser
under clause 8.13.

	8.7  	Other limits on Claims
	 
	   	The liability of the Vendor in respect of any Claim for breach of any Warranty is
reduced or extinguished (as the case may be) to the extent that:

	 	(a)  	the subject matter of any Claim is provided for in the Accounts; or
	 
	 	(b)  	the Claim has arisen as a result of or in consequence of any voluntary act,
omission, transaction or arrangement of or on behalf of the Purchaser after Completion;
or
	 
	 	(c)  	the Claim is as a result of or in respect of, or where the Claim arises from,
any increase in the rate of Tax liable to be paid or any imposition of Tax not in
effect at the date of this agreement; or
	 
	 	(d)  	the Purchaser has not complied with clause 8.14; or
	 
	 	(e)  	the Claim occurs or is increased as a result of legislation not in force or in
effect at the date of this agreement; or
	 
	 	(f)  	the Claim occurs as a result of a change after the date of this agreement in
any law or interpretation of law; or

			
	 	 	 
	

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	 	(g)  	the Purchaser is aware of any fact, matter or thing that it should reasonably
know constitutes, or would be reasonably expected with the lapse of time to constitute,
a breach of that Warranty.

	8.8  	Maximum aggregate liability for Claims
	 
	   	Subject to clause 8.12, the maximum aggregate liability of the Vendor (including legal
costs and expenses incurred in defending a Claim from a third party), as a result of Claims
for breach of the Warranties under any of the Transaction Documents is limited to the
Transaction Consideration.
	 
	8.9  	Transaction Consideration not known
	 
	   	If the final amount of the Transaction Amount is not known at any relevant time in
relation to a Claim for breach of the Warranties under the Transaction Documents, the
liability of the Vendor is not limited in respect of any such Claim to the amount of the
Transaction Consideration at that time, but to the Transaction Consideration when it is
finally known.
	 
	8.10  	Vendor Indemnity where Transaction Consideration not known
	 
	   	In the event that the Transaction Consideration at the time of the determination of any
Claim for breach of the Warranties under the Transaction Documents is less than the amount
that the Purchaser would have been entitled but for the Transaction Consideration not being
finally known (Known Transaction Consideration), the Vendor undertakes to the Purchaser to
keep the Purchaser at all times fully and effectively indemnified for the difference between
the amount that the Purchaser would have been entitled but for the Transaction Consideration
not being finally known and the Known Transaction Consideration, up to the amount of the
Transaction Consideration when it is finally known
	 
	8.11  	Purchaser Indemnity where Transaction Consideration not known
	 
	   	Where an amount is paid by the Vendor in respect of any Claim for breach of the
Warranties under the Transaction Documents which is in excess of the amount of the
Transaction Consideration when finally known, the Purchaser undertakes to the Vendor to keep
the Vendor at all times fully and effectively indemnified for the amount of that excess,
except where the Claim is not subject to clause 8.8.
	 
	8.12  	Exclusions of limitations
	 
	   	The limitations in:

	 	(a)  	Clauses 8.6(a) or (b) and 8.8 do not apply to Warranty 12 where:

	 	(i)  	there has been fraud, dishonesty or wilful concealment on the
part of the Vendor or anyone acting on behalf of the Vendor; or
	 
	 	(ii)  	there is the amendment of an assessment permitted by section
170(10) of the 1936 Act.

	 	(b)  	Clauses 8.5 and 8.6(a) do not apply to a Claim relating to Warranties 2, 3, 4,
6.10 or 18.
	 
	 	(c)  	Clauses 8.5, 8.6(a) or (b) and 8.8 do not apply where there has been fraud,
dishonesty or wilful concealment on the part of the Vendor or anyone acting on behalf
of the Vendor.
	 
	 	(d)  	Clause 8.6(a) does not apply to any claim which arises from or is connected to
prosecution by a Governmental Authority.

	8.13  	Notice of potential Claim
	 
	   	If the Purchaser becomes aware of anything which is or may be reasonably likely to give
rise to a Claim under this clause 8 it must notify the Vendor in writing, within 10 Business
Days after it has first come to the Purchaser’s attention (Claim Notice), setting out the
act, matter or thing

			
	 	 	 
	

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	   	relied on as giving rise to the Claim, the Warranty the subject of the Claim and all
relevant details of the Claim in so far as they are available to the Purchaser.
	 
	8.14  	Conduct of third party Claims

	 	(a)  	The Vendor, subject to this clause 8.14 and clause 8.17, is in respect of an act,
matter or thing notified by the Purchaser under clause 8.13, where that act, matter or
thing relates to an actual or threatened Claim from a third party, entitled to elect by
written notice given to the Purchaser within 10 Business Days of receipt of a Claim
Notice to:

	 	(i)  	take over the conduct of the Claim; and
	 
	 	(ii)  	take such actions as the Vendor may decide about it, including
the right to negotiate, defend and/or settle the Claim and to recover costs
incurred as a consequence of the Claim from any person.

	 	(b)  	Where the Vendor takes over the conduct and/or defence of any claim under this
clause 8.14, the Vendor must:

	 	(i)  	afford the Purchaser the opportunity to consult with the Vendor
on all matters of significance for the goodwill of the Business; and
	 
	 	(ii)  	at reasonable and regular intervals provide the Purchaser with
written reports concerning the conduct, negotiation, control, defence and/or
outcome or settlement of the Claim.

	 	(c)  	The Purchaser must, and must procure that the Company must, provide the Vendor
with access to (with the right to take copies) and make available to the Vendor all
relevant personnel, relevant documents, books and records reasonably required for the
purpose of the conduct of any Claim under clause 8.14(a).

	8.15  	Rights of the Purchaser
	 
	   	If the Purchaser gives the Vendor a Claim Notice under clause 8.13 and the Vendor does
not elect to take over the control of a Claim under clause 8.14, the Purchaser may take such
actions as the Purchaser may decide about it, including the right to negotiate, defend
and/or settle the Claim and to recover costs incurred as a consequence of the Claim from any
person, if:

	 	(a)  	the Purchaser at reasonable and regular intervals provides the Vendor with
written reports concerning the conduct, negotiation, control, defence and/or settlement
of the Claim and must not settle the Claim without the prior approval of the Vendor
which must not be unreasonably withheld;
	 
	 	(b)  	the Purchaser affords the Vendor the opportunity to consult with the Purchaser
on matters of significance in relation to the conduct, negotiation and settlement of
the Claim; and
	 
	 	(c)  	the Vendor renders to the Purchaser, at the Purchaser’s expense, all such
assistance as the Purchaser may reasonably require in disputing any Claim.

	8.16  	Costs indemnity
	 
	   	The Vendor indemnifies the Purchaser and the Company against all Liabilities incurred
by, or awarded against, the Purchaser or the Company arising out of the conduct of the
Vendor under clause 8.14 or acts required or requested of the Purchaser or the Company in
respect of the same, as and when they fall due, including reasonable legal costs and
disbursements of the Purchaser’s lawyers and the Company’s lawyers.

			
	 	 	 
	

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	8.17  	Security for costs

	 	(a)  	If the Vendor intends to, or takes control of, a Claim under clause 8.14, the
Purchaser is entitled to require that the Vendor provide Security to the Purchaser or a
Group Company (as the case may be) (Claimee).
	 
	 	(b)  	The Purchaser is entitled to require that Security is provided at any time on
written notice to the Vendor (Notice). Subject to sub clauses 8.17(d) and (f), the
Notice must specify the amount and terms of the Security required by the Purchaser.
	 
	 	(c)  	The Vendor’s entitlement to take over the control of a Claim under clause 8.14,
or continue to control a Claim ceases immediately if it fails to provide the Security
within 10 business days of the Notice.
	 
	 	(d)  	For the purpose of this clause 8.17, the Security must be cash or in
immediately available funds and on terms reasonably satisfactory to the Purchaser.
	 
	 	(e)  	The Claimee is entitled to use the Security to pay any Liability arising out of
or in relation to the Claim.
	 
	 	(f)  	Any Security required by the Purchaser under this clause 8.17 shall not exceed
the amount reasonably necessary to secure the obligations of the Vendor under clause
8.16.
	 
	 	(g)  	If the Vendor and the Purchaser do not agree any matter or amount referred to
in this clause 8.17, then the matter in dispute must be referred at the request of
either the Vendor or the Purchaser to the Costs Assessor for decision.
	 
	 	(h)  	The Costs Assessor is to be appointed by agreement between the Vendor and the
Purchaser or, in default of agreement within 14 days of a request by either the Vendor
or the Purchaser, by the President for the time being of the Law Society of New South
Wales.
	 
	 	(i)  	The Costs Assessor will act as an expert and not as an arbitrator and his or
her decision will be final and binding on the parties.
	 
	 	(j)  	The fees of the Costs Assessor will be borne by the Vendor.

	8.18  	Warranty payments
	 
	   	Any payment made in respect of a Claim for breach of a Warranty is deemed (to the
extent possible) to be a reduction in the Purchase Price.
	 
	8.19  	Benefits or credits received by the Company or the Purchaser
	 
	   	If any payment in respect of a Claim under the Warranties is made to the Purchaser by
or on behalf of the Vendor and after the payment is made the Purchaser or any Group Company
receives any benefit or credit in relation to the subject matter of the Claim (including
payment under any insurance policy), then the Purchaser:

	 	(a)  	must immediately notify the Vendor of the benefit or credit; and
	 
	 	(b)  	pay to the Vendor an amount equal to the amount (net of expenses and Tax) of
the benefit or credit received by the Purchaser or a Group Company (as the case may
be).

	8.20  	Meaning of Vendor’s knowledge
	 
	   	Where any Warranty is qualified by the expression ‘as far as the Vendor is aware’ or
any similar expression that statement is taken to include an additional statement that it
has been made after due and careful enquiry.

			
	 	 	 
	

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	8.21  	Taxation indemnity

	 	(a)  	The Vendor undertakes to the Purchaser to keep the Purchaser and each Group Company
at all times fully and effectively indemnified from and against any liability for Tax
of a Group Company arising on or before Completion or arising after Completion and
wholly or partly attributable to any event occurring on or before Completion.
	 
	 	(b)  	The Vendor has no liability under clause 8.17(a) unless the Purchaser has given
written notice of the Claim to the Vendor under clause 8.10 on or before the seventh
anniversary of the Completion Date.
	 
	 	(c)  	The limitation in clause 8.17(b) does not apply where:

	 	(i)  	there has been fraud, dishonesty or wilful concealment on the
part of the Vendor or anyone acting on behalf of the Vendor; or
	 
	 	(ii)  	there is the amendment of an assessment permitted by section
170(10) of the 1936 Act.

	 	(d)  	For the avoidance of doubt, the Vendor may elect to take over the conduct of a
Claim and take such actions as the Vendor may decide in relation to a Claim under
clause 8.11 upon receipt of a Claim Notice from the Purchaser pursuant to clause 8.10
but subject to the requirements of clauses 8.14 to 8.17 inclusive.

	8.22  	Trade Practices Act
	 
	   	To the extent permitted by law, the Purchaser agrees not to make, and waives any right
it may have to make, any claim against the Vendor or any Associate of the Vendor under
section 52 of the Trade Practices Act 1974 (Cth) or the corresponding provision of any
Australian State or Territory enactment.
	 
	8.23  	Financial forecasts
	 
	   	The parties acknowledge and agree that the Warranties do not apply to any financial
forecasts, projections, opinions of future performance or other statements relating to
financial prospects of the Group that have been provided by the Vendor or an Associate of
the Vendor. No warranty is given or representation made that any such financial forecast,
projection or opinion will be met or achieved. Any such information that has been provided
to the Purchaser was provided for information purposes only.
	 
	9.  	GST
	 
	9.1  	Interpretation
	 
	   	In this clause 9, a word or expression defined in the A New Tax System (Goods and
Services Tax) Act 1999 (Cth) has the meaning given to it in that Act.
	 
	9.2  	GST gross up
	 
	   	If a party makes a supply under or in connection with this agreement in respect of
which GST is payable, the consideration for the supply but for the application of this
clause 9.2 (GST exclusive consideration) is increased by an amount equal to the GST
exclusive consideration multiplied by the rate of GST prevailing at the time the supply is
made.
	 
	9.3  	Reimbursements
	 
	   	If a party must reimburse or indemnify another party for a loss, cost or expense, the
amount to be reimbursed or indemnified is first reduced by any input tax credit the other
party is entitled to for the loss, cost or expense, and then increased in accordance with
clause 9.2.

			
	 	 	 
	

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	9.4  	Tax invoice
	 
	   	A party need not make a payment for a taxable supply made under or in connection with
this agreement until it receives a tax invoice for the supply to which the payment relates.
	 
	10.  	Notices and other communications
	 
	10.1  	Service of notices
	 
	   	A notice, demand, consent, approval or communication under this agreement (Notice) must
be:

	 	(a)  	in writing, in English and signed by a person duly authorised by the sender;
and
	 
	 	(b)  	hand delivered or sent by prepaid post or facsimile to the recipient’s address
for Notices specified in the Details, as varied by any Notice given by the recipient to
the sender.

	10.2  	Effective on receipt
	 
	   	A Notice given in accordance with clause 10.1 takes effect when taken to be received
(or at a later time specified in it), and is taken to be received:

	 	(a)  	if hand delivered, on delivery;
	 
	 	(b)  	if sent by prepaid post, the second Business Days after the date of posting (or
the seventh Business Day after the date of posting if posted to or from a place outside
Australia);
	 
	 	(c)  	if sent by facsimile, when the sender’s facsimile system generates a message
confirming successful transmission of the entire Notice unless, within eight Business
Hours after the transmission, the recipient informs the sender that it has not received
the entire Notice,

	   	but if the delivery, receipt or transmission is not on a Business Day or is after 5.00pm on
a Business Day, the Notice is taken to be received at 9.00am on the next Business Day.
	 
	11.  	Miscellaneous
	 
	11.1  	Alterations
	 
	   	This agreement may be altered only in writing signed by each party.
	 
	11.2  	Approvals and consents
	 
	   	Except where this agreement expressly states otherwise, a party may, in its discretion,
give conditionally or unconditionally or withhold any approval or consent under this
agreement.
	 
	11.3  	Assignment
	 
	   	A party may only assign this agreement or a right under this agreement with the prior
written consent of each other party.
	 
	11.4  	Costs
	 
	   	Each party must pay its own costs of negotiating, preparing and executing this agreement.
	 
	11.5  	Stamp duty
	 
	   	Any stamp duty, duties or other taxes of a similar nature (including fines, penalties
and interest) in connection with this agreement or any transaction contemplated by this
agreement, must be paid by the Purchaser.

			
	 	 	 
	

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	11.6  	Survival
	 
	   	Any indemnity or any obligation of confidence under this agreement is independent and
survives termination of this agreement. Any other term by its nature intended to survive
termination of this agreement survives termination of this agreement.
	 
	11.7  	Counterparts
	 
	   	This agreement may be executed in counterparts. All executed counterparts constitute
one document.
	 
	11.8  	No merger
	 
	   	The rights and obligations of the parties under this agreement do not merge on
completion of any transaction contemplated by this agreement.
	 
	11.9  	Entire agreement
	 
	   	This agreement, together with the Head Agreement, any side letters which may have been
exchanged between the parties prior to execution and remaining Transaction Documents,
constitutes the entire agreement between the parties in connection with its subject matter
and supersedes all previous agreements or understandings between the parties in connection
with its subject matter, including the memorandum of understanding between the Company,
Stemcor Australia Pty Limited and the Vendor, dated 1 December 2004.
	 
	11.10  	Further action
	 
	   	Each party must do, at its own expense, everything reasonably necessary (including
executing documents) to give full effect to this agreement and any transactions contemplated
by it.
	 
	11.11  	Severability
	 
	   	A term or part of a term of this agreement that is illegal or unenforceable may be
severed from this agreement and the remaining terms or parts of the term of this agreement
continue in force.
	 
	11.12  	Waiver
	 
	   	A party does not waive a right, power or remedy if it fails to exercise or delays in
exercising the right, power or remedy. A single or partial exercise of a right, power or
remedy does not prevent another or further exercise of that or another right, power or
remedy. A waiver of a right, power or remedy must be in writing and signed by the party
giving the waiver.
	 
	11.13  	Relationship
	 
	   	Except where this agreement expressly states otherwise, it does not create a
relationship of employment, trust, agency or partnership between the parties.
	 
	11.14  	Governing law and jurisdiction
	 
	   	This agreement is governed by the law of New South Wales and each party irrevocably and
unconditionally submits to the non-exclusive jurisdiction of the courts of New South Wales.

			
	 	 	 
	

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Schedule 1 — Details of the Company and the Subsidiary

Part A: Details of the Company

	 	 	 
	Name and ACN:

	 	BEVIRON PTY LIMITED ACN 078 197 323
	 
	 	 
	Registered office:

	 	58-60 Wilmot Street, Burnie, Tasmania 7320
	 
	 	 
	Date of incorporation/
registration:

	 	23 April 1997
	 
	 	 
	Share capital:

	 	A$126,180,760.00 comprising 82,519,735 fully-paid ordinary shares.
	 
	 	 
	Directors:

	 	Ian Wargent ROSS
	 
	 	 
	

	 	David Alan SANDY
	 
	 	 
	Secretaries:

	 	Jeanette Ann NORTON
	 
	 	 
	

	 	Bruce Craig LORKING

Part B: Details of the Subsidiary

	 	 	 
	Name and ACN:

	 	GOLDAMERE PTY LIMITED ACN 073 634 581
	 
	 	 
	Registered office:

	 	58-60 Wilmot Street, Burnie, Tasmania 7320
	 
	 	 
	Date of incorporation/
registration:

	 	15 April 1996
	 
	 	 
	Share capital:

	 	A$11,000,100 comprising 11,000,100 fully-paid ordinary shares.
	 
	 	 
	Directors:

	 	Ian Wargent ROSS
	 
	 	 
	

	 	David Alan SANDY
	 
	 	 
	Secretaries:

	 	Jeanette Ann NORTON
	 
	 	 
	

	 	Bruce Craig LORKING

			
	 	 	 
	

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Schedule 2 — Warranties

Warranty 1 — Defined terms

	   	In these Warranties:
	 
	   	Environment means the physical factors of the surrounds of human beings including the
land, waters, atmosphere, climate, sound, odours, place, the biological factors of animal
and plant and the social factors of aesthetics.
	 
	   	Environmental Authorisation means a licence, consent, approval, permit, authorisation,
certificate of registration, or other concession issued by a government agency and any
agreement which is required, obtained or entered into in respect of the Land pursuant to an
Environmental Law.
	 
	   	Environmental Law means a law regulating or otherwise relating to the Environment
including, without limitation: land use; planning; environmental assessment; building
regulation; pollution of the atmosphere, water or land; noise; contamination; chemicals;
waste; the use or presence of asbestos, dangerous goods or Hazardous Substances; human
health and safety; heritage; species; flora and fauna; or any other aspect of the protection
of the Environment or the enforcement or administration of any such Environmental Law.
	 
	   	Hazardous Substance means any substance which is, or may be hazardous, toxic, dangerous
or polluting which may present a risk to human health or any other aspect of the
Environment, or which is regulated by any Environmental Law.
	 
	   	Land means the Properties and the land the subject of the Mining Lease.
	 
	   	Mining Lease means Consolidated Mining Lease No. 2M/2001 under the Mineral Resources
Development Act, 1995 (Tas.).
	 
	   	Subsidiary Shares means all the shares in the share capital of the Subsidiary.
	 
	   	Superannuation Commitment means any obligation, liability or duty to make any payment
to any person in respect of any superannuation or retirement benefits or pensions that are
or may be provided to any present or former Employees of the Company or their respective
dependants.

Warranty 2 — Vendor

	2.1  	The Vendor has full authority and all necessary consents to enter into and perform this
agreement and, when executed, this agreement will constitute binding obligations on the Vendor
in accordance with its terms.
	 
	2.2  	The sale of the Shares under this agreement will not:

	 	(a)  	impose any Encumbrance on the Vendor; or
	 
	 	(b)  	put the Vendor in breach of any obligation or agreement by which it is bound.

	2.3  	No:

	 	(a)  	meeting has been convened, resolution proposed, petition presented or order
made for the winding up of the Vendor;
	 
	 	(b)  	receiver, receiver and manager, provisional liquidator, liquidator or other
officer of the Court has been appointed in relation to all or any material assets of
the Vendor; or

			
	 	 	 
	

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	 	(c)  	mortgagee has taken, attempted or indicated an intention to exercise its rights
under any security of which the Vendor is the mortgagor or chargor.

Warranty 3 — Group Companies

	   	No:

	 	(a)  	meeting has been convened, resolution proposed, petition presented or order
made for the winding up of a Group Company;
	 
	 	(b)  	receiver, receiver and manager, provisional liquidator, liquidator or other
officer of the Court has been appointed in relation to all or any material assets of a
Group Company; or
	 
	 	(c)  	mortgagee has taken, attempted or indicated an intention to exercise its rights
under any security of which a Group Company is the mortgagor or chargor.

Warranty 4 — Share capital

	4.1  	The share capital of each Group Company set out in Schedule 1:

	 	(a)  	comprises the entire share capital of the Group Company; and
	 
	 	(b)  	is fully paid.

	4.2  	The Vendor:

	 	(a)  	will be the registered and beneficial owner of the Shares on the Completion
Date; and
	 
	 	(b)  	has complete power and right to sell those shares to the Purchaser.

	4.3  	As at Completion there will be no option, right to acquire or Encumbrance over or affecting
the Shares, the Subsidiary Shares or any of them.
	 
	4.4  	No person is entitled, or has claimed to be entitled, to require a Group Company to issue any
share capital either now or at any future date (whether contingently or not). There are no
agreements in force under which any person is or may be entitled to, or has the right to call
for the issue of, any shares in a Group Company or securities convertible into or exchangeable
for shares in a Group Company. No Group Company has given, granted or agreed to grant any
option or right (whether contingent or not) in respect of its unissued shares.
	 
	4.5  	The Company is the registered and beneficial owner of the Subsidiary Shares.
	 
	4.6  	Except as stated in the schedules to this agreement, no Group Company holds or beneficially
owns any securities of any other corporation or has agreed to acquire any securities of any
other corporation.
	 
	4.7  	No Group Company is the holder of any rights or options to subscribe for, purchase or acquire
any shares, securities, partnership interest or joint venture interest in any other entity.
	 
	4.8  	No Group Company is or has agreed to become, a member of any partnership or other
unincorporated association, joint venture or consortium (excluding recognised trade
associations).

Warranty 5 – Information

	5.1  	The details relating to each Group Company set out in Schedule 1 is complete and accurate.
	 
	5.2  	As far as the Vendor is aware, all information given by or on behalf of the Vendor to the
Purchaser relating to each Group Company including that contained in the Disclosure Letter and
Due Diligence Material is true, complete and accurate in all material respects and none of
that

			
	 	 	 
	

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	   	information is misleading in any material respect, whether as a result of the inclusion of
misleading information or the omission of material information or both.
	 
	5.3  	Other than circumstances affecting the whole of any industry in which each Group Company
participates, the Vendor is not aware of any circumstances which might reasonably be expected
to have a material adverse effect on either:

	 	(a)  	the financial position, business, operations, assets, profitability or
prospects of a Group Company; or
	 
	 	(b)  	the value of the Shares and the Subsidiary Shares.

	5.4  	All information which the Vendor knows or could reasonably be expected to know and which
would be reasonably likely to affect the Purchaser’s decision to purchase the Shares on the
terms and conditions of this agreement, has been fully disclosed to the Purchaser in writing.

Warranty 6 — Accounts

	6.1  	The Accounts:

	 	(a)  	were prepared in accordance with applicable laws and generally accepted
accounting principles in Australia; and
	 
	 	(b)  	give a true and fair view of the financial position and affairs of each Group
Company and the Business as at the Accounts Date.

	6.2  	Since the Accounts Date:

	 	(a)  	each Group Company has carried on the Business in the ordinary and usual
course;
	 
	 	(b)  	no contracts or commitments differing from those ordinarily made in the conduct
of the Business have been entered into or incurred;
	 
	 	(c)  	there has been no material adverse change in the assets, liabilities, financial
position or the profitability of a Group Company;
	 
	 	(d)  	neither Group Company has declared or paid any dividend, made any reduction in
its share capital or made any offer, or entered into any agreement, to buy back any of
its shares;
	 
	 	(e)  	except for current assets offered for sale or sold in the ordinary course of
its usual business, no Group Company has disposed of any of the assets included in the
Accounts or any assets acquired or agreed to be acquired since the Accounts Date;
	 
	 	(f)  	the Business has not been materially adversely affected by the loss of any
customer who, in either of the two accounting periods immediately preceding the
Accounts Date, accounted for 10 percent or more of the Subsidiary’s sales for either of
those periods.

	6.3  	No person has given a guarantee or indemnity or is otherwise a surety in respect of a Group
Company or its Business.

Carrying on business

	6.4  	The Company has not carried on any business since the date of its incorporation other than to
own all of the shares in the capital of the Subsidiary. The Company has not employed any
person since the date of its incorporation. The Company will not commence to carry on any
other business or employ any person before the Completion Date.

			
	 	 	 
	

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Ownership of assets

	6.5  	All the assets included in the Accounts are owned by the relevant Group Company to which they
relate and material particulars of all fixed assets acquired or agreed to be acquired by a
Group Company since the Accounts Date are set out in the Due Diligence Materials.

Encumbrances

	6.6  	None of the property, assets, undertaking, goodwill or uncalled capital of any Group Company
is subject to any Encumbrance.

Management accounts

	6.7  	The unaudited management accounts of each Group Company for the period of 12 months ended 31
December 2004 have been prepared on a basis consistent with that employed in preparing the
Accounts. They give a true and fair view of the assets, liabilities, income, expenditure and
cash flow of the Group Company for which they were prepared for that period and at the end of
that period and there has been no material adverse change in the assets, liabilities or
financial position of a Group Company since that date.

Finance

	6.8  	There are no guarantees, loans, undertakings or commitments on capital account, actual or
contingent, or comfort arrangements (whether or not legally binding) which have been made,
given, entered into or incurred by or on behalf of any Group Company (and whether to procure
the solvency of any other person or otherwise).
	 
	6.9  	A Group Company has not borrowed any monies and has no bank overdraft facilities, acceptance
credits or other financial facilities outstanding or available to it.

Loans from related parties

	6.10  	There is no loan to a Group Company from, or amount owing by a Group Company to:

	 	(a)  	the Vendor;
	 
	 	(b)  	an Associate, or former Associate, of the Vendor (with the exception of
Arbutus);
	 
	 	(c)  	Robert M Friedland;
	 
	 	(d)  	an Associate, or former Associate, of Robert M Friedland (with the exception of
Arbutus);
	 
	 	(e)  	Ivanhoe Capital Finance Ltd; or
	 
	 	(f)  	Goldamere Holdings (L) Ltd,

	    	other than the Beviron Debt 2, Beviron Debt 3, Beviron Debt 6 and Goldamere Debt. In this
paragraph 6.10, Associate has the meaning given to that term by section 318 of the Income
Tax Assessment Act 1936.

Warranty 7 — Records

	7.1  	As far as the Vendor is aware, the Records:

	 	(a)  	have been fully, properly and accurately kept and completed and are in the
possession or control of the Group Company to whom they relate; and
	 
	 	(b)  	do not contain material inaccuracies or discrepancies of any kind.

	7.2  	The constitution of each Group Company given to the Purchaser’s solicitors is its
constitution and is complete and accurate in all respects.

			
	 	 	 
	

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Warranty 8 — Business contracts

	8.1  	As far as the Vendor is aware, there are no agreements, arrangements or understandings
affecting a Group Company or the carrying on of the Business that:

	 	(a)  	are material to the operation of the Business and have not been disclosed in
writing to the Purchaser;
	 
	 	(b)  	are outside the ordinary and proper course of business of the Business or
otherwise contain any unusual, abnormal or onerous provision;
	 
	 	(c)  	are incapable of being fulfilled or performed on time without undue or unusual
expenditure of money or effort;
	 
	 	(d)  	entitle the other party to terminate the agreement, or impose terms less
favourable to the Business, by reason of a sale of the Shares; or
	 
	 	(e)  	are agency or management agreements.

	8.2  	With respect to each contract which is material to the Business, the Vendor is not aware:

	 	(a)  	of any party to the contract being in default;
	 
	 	(b)  	of any grounds for termination, rescission or avoidance or repudiation of that
contract;
	 
	 	(c)  	of any fact, matter or circumstance that is reasonably likely to have a
material adverse effect on the financial position or prospects of the Subsidiary; or
	 
	 	(d)  	of the termination, rescission or avoidance or repudiation of any such
contract.

	8.3  	No Group Company has entered into any transaction that could give any person the right to do
either of the following:

	 	(a)  	set aside any rights that the Group Company has in relation to that person; or
	 
	 	(b)  	recover property or receive any payment from that Group Company,

	   	under Division 2 of Part 5.7B of the Corporations Act 2001 (Cth) or similar laws relating to
insolvency or bankruptcy.
	 
	8.4  	The Subsidiary will not be required after the date of this agreement to undertake any work or
supply any goods or services, except on normal commercial terms, under a contract entered into
on or before the date of this agreement.
	 
	8.5  	Since the Accounts Date, there has been no material adverse change to the terms of trade of
the Business, including price.
	 
	8.6  	No offer, tender, quotation or similar intimation given or made by the Subsidiary in
connection with the Business, which is capable of giving rise to an agreement merely by the
unilateral act of a third party, is still outstanding, except in the ordinary course of the
Business.
	 
	8.7  	The Subsidiary has not manufactured or sold products which do not comply in any material
respect with any warranty or representation expressly or impliedly made by it.
	 
	8.8  	The Subsidiary has not accepted any obligation to take back or otherwise do anything in
respect of any item sold or delivered by it.
	 
	8.9  	As far as the Vendor is aware, all of the agreements to which a Group Company is a party that
have been disclosed to the Purchaser are valid, subsisting, legal and binding obligations in
accordance with their terms.

			
	 	 	 
	

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	8.10  	No Group Company has received any written notice which is reasonably likely to have a
material adverse effect on the exercise of any rights by a Group Company in respect of any
material agreement.
	 
	8.11  	There is no agreement, arrangement or understanding involving the Subsidiary in relation to
the Business which requires, as a condition of the supply of goods and services by the
Subsidiary, that the Subsidiary acquire goods or services from any other specific person.
	 
	8.12  	The Subsidiary is not a party to any agreement, arrangement or understanding under which it
is or may be bound to share any profits or to pay any royalties or to waive or abandon any
rights in connection with the Business or any of its assets.
	 
	8.13  	The Subsidiary is not a party to either of the following:

	 	(a)  	any agency, distributorship, marketing, purchasing, manufacturing or licensing
agreement or arrangement which has, or is likely to have, a material adverse effect on
the cash flows or profitability of the Business; or
	 
	 	(b)  	any agreement or arrangement which restricts its freedom to carry on any part
of the Business in any part of the world in the manner it thinks fit.

	8.14  	The Subsidiary is not a party, and has not during the last six years been a party, to any of
the following:

	 	(a)  	any agreement, arrangement concerted practice or course of conduct which is
wholly or partly void or unenforceable under the Trade Practices Act 1974 (Cth) or any
similar legislation, or which may render it liable to proceedings under any legislation
concerning competition; or
	 
	 	(b)  	any agreement or arrangement or business practice in respect of which an
undertaking has been given by or an order made against or in relation to it under any
anti-trust or similar legislation in any jurisdiction in which it carries on the
Business or has assets or sales.

Warranty 9 — Employees

	9.1  	The Company has never employed any person.
	 
	9.2  	As far as the Vendor is aware, the Subsidiary has complied in all material respects with all
obligations arising under law, equity or statute, award, enterprise agreement or other
instrument made or approved under any law with respect to employment of its employees
including all Records required to be kept in relation to the employment, health and safety of
any person.
	 
	9.3  	In respect of the employees of the Subsidiary who are not the subject of an award or
enterprise agreement:

	 	(a)  	the Vendor has disclosed to the Purchaser a representative sample of their
particulars of employment (including full particulars of pay and other benefits and the
dates of commencement of employment or appointment to an office) which, as far as the
Vendor is aware, are not materially different from the particulars of employment of the
remaining employees of the Subsidiary referred to in this Warranty 9.3;
	 
	 	(b)  	none of them has given, or has been given, notice of termination of his or her
employment or has indicated an intention to terminate his or her employment;
	 
	 	(c)  	no proposal, assurance or commitment (oral or written) has been announced or
given to any of them regarding any change to his or her terms of employment (whether or
not beneficial to him or her) or (without limiting the foregoing) regarding the
continuance,

			
	 	 	 
	

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	 	   	introduction, increase or improvement of any benefit (including any retirement, death
or disability benefit).

	9.4  	There is no outstanding offer of employment to any person with a base salary in excess of
$200,000, other than a person who would be the subject of an award or enterprise agreement, by
any Group Company and there is no such person who has accepted a like offer of employment made
by any Group Company but whose employment has not yet started.
	 
	9.5  	All subsisting contracts of employment to which the Subsidiary is a party are terminable by
it on one month’s notice or less.
	 
	9.6  	The Subsidiary has no liability to pay compensation for loss of office or employment to any
present or former employee and no such sums have been paid since the Accounts Date.
	 
	9.7  	Except in respect of normal accruals of emoluments after the Accounts Date, no sum is owing
or promised to any present or former employee of the Subsidiary.
	 
	9.8  	There are no terms of employment for any employee which provide that a change in control of
the Subsidiary (however change of control be defined if at all) entitles the employee to treat
the change of control as amounting to a breach of the contract or entitling him or her to any
payment or benefit whatsoever or entitling him or her to treat himself or herself as redundant
or otherwise dismissed or released from any obligation.
	 
	9.9  	No claim has been made or threatened against the Subsidiary, or against any person whom the
Subsidiary or the Vendor is or may be liable to compensate or indemnify, in respect of any
act, event, omission or other matter arising out of or in connection with any of the
following:

	 	(a)  	any application for employment by any person;
	 
	 	(b)  	the employment or termination of employment of any person;
	 
	 	(c)  	any retirement, death or disability benefit or any other benefit of whatever
type;
	 
	 	(d)  	any accident or injury which is not fully covered by insurance.

	9.10  	There is not, and during the three years preceding the date of this agreement there has not
been, any industrial action or industrial dispute directly affecting the Subsidiary. The
Vendor is not aware of any circumstances which could reasonably be expected to give rise to
such industrial action or industrial dispute.
	 
	9.11  	The Subsidiary has not made any loan or advance to any employee or past or prospective
employee which is in excess of $20,000 and is outstanding.

Warranty 10 — Superannuation

	10.1  	The Subsidiary has no Superannuation Commitments.
	 
	10.2  	The Subsidiary has no outstanding or unpaid superannuation contributions.

Warranty 11 — Litigation

	11.1  	There is:

	 	(a)  	no material Claim threatened or pending by or against a Group Company; or
	 
	 	(b)  	as far as the Vendor is aware, no material fact, matter or circumstance likely
to give rise to any Claim or Liability against a Group Company.

	11.2  	There are no material unsatisfied or outstanding judgments, orders or awards affecting a
Group Company.

			
	 	 	 
	

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	11.3  	No Group Company is currently involved in any material legal proceedings.

Warranty 12 — Tax

	12.1  	In Warranty 12:
	 
	   	Consolidated Group has the meaning given in section 703-5 of the 1997 Act.
	 
	   	GST has the meaning given in the GST Act.
	 
	   	GST Act means the A New Tax System (Goods and Services Tax) Act 1999 (Cth).
	 
	   	Relief includes either of the following:

	 	(a)  	Any relief, loss, allowance, credit, deduction, or set-off in computing income,
profits or gains for the purpose of Tax, or any grant conferred on any person; or
	 
	 	(b)  	Any right to repayment of Tax (whether or not including interest or penalties)
available to that person.

	   	Tax Law means any law in relation to any Tax.
	 
	   	Tax Authority means any government, semi-government, administrative, municipal,
statutory, fiscal or judicial body, department, commission, authority, tribunal, agency,
entity or person responsible for the collection of any Tax or administration of any Tax Law.
	 
	   	1997 Act means the Income Tax Assessment Act 1997 (Cth).
	 
	   	1936 Act means the Income Tax Assessment Act 1936 (Cth).

Taxation liabilities

	12.2  	All Tax of any nature whatsoever whether of Australia or elsewhere for which any Group
Company is liable or for which any Group Company is liable to account has been duly paid or
accrued (in so far as such Tax ought to have been paid or accrued).
	 
	12.3  	No Group Company is, nor will in the future become, subject to any Taxes on or in respect of
or by reference to its profits, gains, income, sales, disposals or deemed disposals of or
transactions in relation to assets, inventory, or other property for any period up to and
including the Accounts Date in excess of the provision for Tax included in the Accounts. No
Group Company has nor will become liable to repay any sales tax credit claimed in excess of
amounts entitled to be claimed under the Sales Tax Assessment Act 1992 (Cth).
	 
	12.4  	No Group Company has done anything which has or would give rise to a liability to Tax under
the Taxation (Unpaid Company Tax) Assessment Act 1982 (Cth), whether or not that liability has
been discharged.

Deductions and PAYG

	12.5  	Each Group Company has complied with all of its obligations under any statutory provisions
requiring the deduction or withholding of Tax from amounts paid by the Group Company, whether
on its own behalf or as agents, and has properly accounted for any Tax so deducted or withheld
to any Tax Authority (other than amounts which have yet to become payable). This includes all
amounts of Tax required under statutory provisions to be deducted from the salary or wages of
Employees of each Group Company.
	 
	12.6  	No event has occurred as a result of which any Tax from which a Group Company has obtained
Relief has become payable.

			
	 	 	 
	

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Consolidated Group Tax

	12.7  	At the date of Completion, no Group Company is, or has been, a subsidiary member or head
company of a Consolidated Group.

Tax returns

	12.8  	All necessary information, notices, elections, computations and returns in respect of the Tax
obligations of the Group have been lodged or filed with the appropriate taxation authorities
in accordance with applicable laws and within the prescribed time.
	 
	12.9  	No Tax return, election or notice lodged or filed by a Group Company contains either of the
following:

	 	(a)  	A false or misleading statement or omits to refer to a matter which is required
to be included or without which the statement is false or misleading.
	 
	 	(b)  	A material error or a material omission relating to the assessment of a Tax
liability of a Group Company.

	12.10  	Each Group Company has maintained sufficient records to support all returns lodged or filed
relating to Taxes and to comply with any relevant Tax legislation.

Penalties and Interest

	12.11  	No Group Company has within the past six years paid or become liable to pay, nor, as far as
the Vendor is aware, are there any circumstances by reason of which a Group Company will
become liable to pay, any penalty, fine, surcharge or interest whether charged by virtue of
the provisions of the Tax Acts, the Sales Tax Assessment Act 1992 (Cth), the Tax
Administration Act 1953 (Cth) or under any other law relating to Tax.

Investigations

	12.12  	No Group Company has within the past 12 months suffered any investigation audit or visit by
the Commissioner of Tax or any other Tax Authority, and the Vendor is not aware of any such
investigation audit or visit planned for the next 12 months.
	 
	12.13  	If a Group Company has suffered any investigation audit or visit by the Commissioner of Tax
or any other Tax Authority during the past 12 months or at any time in the past five years,
all information in relation to any such investigation audit or visit has been provided to the
Buyer in writing.

Applications

	12.14  	Each application for a ruling, consent or clearance given to a Tax Authority on behalf of a
Group Company fully and accurately disclosed all facts, circumstances and material necessary
for the decisions of the taxation authority in connection with the application.
	 
	12.15  	Each ruling, consent or clearance obtained by or on behalf of a Group Company from a Tax
Authority in relation to a Tax issue is valid and effective.
	 
	12.16  	Each transaction for which that ruling, consent or clearance has previously been obtained
has been carried into effect in accordance with the terms of the application, ruling, consent
or clearance.
	 
	12.17  	No Group Company has taken any action which has or might alter or affect any arrangement,
agreement or Tax ruling which has previously been negotiated with or obtained from the
relevant Government agency under any Tax Law.

			
	 	 	 
	

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Tax losses

	12.18  	The Tax losses of each Group Company, as disclosed in the most recent lodged corporate
income tax return for each Group Company:

	 	(a)  	are available to be offset against future assessable income of each Group
Companies (subject to the application of section 165–13 of the 1997 Act as a result of
the transfer of the Shares);
	 
	 	(b)  	have not been, and not required to be as a result of any transaction, act or
omission on or before Completion, reduced as a result of the application of the
commercial debt forgiveness rules contained in Schedule 2C of the 1936 Act except as
follows:

	 	(i)  	except as disclosed in the income tax returns of each Group
Company which have been reviewed as part of the Due Diligence Materials; and
	 
	 	(ii)  	except as disclosed to, and agreed with, the Purchaser, and
arising between the date of execution of this agreement and the Completion Date,
up to a maximum of US$4,500,000; and
	 
	 	(iii)  	except where such an application arises out of the assignment of
any loan to the Assignee under a Transaction Document.

Debt Forgiveness

	12.19  	The commercial debt forgiveness rules contained in Schedule 2C of the 1936 Act have not
applied in relation to any transaction, act or omission of a Group Company occurring or
arising on or before Completion, except as follows:

	 	(a)  	except as disclosed in the income tax returns of each Group Company which have
been reviewed as part of the Due Diligence Materials; and
	 
	 	(b)  	except as disclosed to, and agreed with, the Purchaser, and arising between the
date of execution of this agreement and the Completion Date, up to a maximum of
US$4,500,000; and
	 
	 	(c)  	except where such an application arises out of the assignment of any loan to

the Assignee under a Transaction Document.

Share capital

	12.20  	No Group Company has a share capital account that is tainted under section 160ARDM of the
1936 Act by the transfer of an amount to the share capital account from any of its other
accounts.

Records of Assets

	12.21  	Each Group Company maintains and has retained for the period required by law the following:

	 	(a)  	Accurate records of all assets to which Part IIIA of the 1936 Act or Parts 3.1
to 3.3 of the 1997 Act apply or have applied; and
	 
	 	(b)  	Without limiting the generality of the foregoing, accurate records of all
information relating to those assets as was referred to in section 160ZZU of the 1936
Act or is referred to in Division 121 of the 1997 Act.

Capital gains tax

	12.22  	No Group Company has sought capital gains tax Relief under s160ZZO of the 1936 Act or
Division 126 of the 1997 Act with respect to any asset acquired by a Group Company and which
is still owned by that Group Company.

			
	 	 	 
	

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Australian residence

	12.23  	Each Group Company is and has throughout the past six years been resident in Australia for
Tax purposes.

Tax avoidance

	12.24  	No Group Company has been a party to or otherwise involved in any transactions to which Part
IVA of the 1936 Act or section 91 or Part 8 of the Sales Tax Assessment Act 1992 (Cth)
applies.
	 
	12.25  	Without limiting clause 12.24 of this schedule no Group Company has been involved in any
transaction or series of transactions which, or any part of which, may for any Tax purposes be
disregarded or reconstructed by reason of any motive to avoid, reduce or delay a possible
liability to Tax.

GST

	12.26  	Any GST required to be paid by a Group Company to the Australian Tax Office has been
imposed, obtained and remitted to the Australian Tax Office in accordance with its commitments
under the GST Act. Each Group Company has complied with all of its obligations under the GST
Act and other legislation associated with the introduction of the GST.
	 
	12.27  	If under or by virtue of any agreement to which any Group Company is a party, any GST is
liable to be paid in connection with any taxable supply made by that Group Company under that
agreement, the Group Company will be entitled to recover from the party required to pay for
the taxable supply an amount so that after meeting any liability to pay GST the Group Company
retains the same amount as if GST was not payable in connection with the taxable supply.
	 
	12.28  	No Group Company has been a party to or otherwise involved in any transaction to which
Division 165 of the GST Act applies.

Stamp duty and other Taxes

	12.29  	All stamp duty and other Tax payable in respect of every agreement, document or transaction
to which a Group Company is or has been a party or by which a Group Company derives, or has
derived, a substantial benefit has been duly paid.

Warranty 13 — Insurance

	13.1  	Each Group Company’s insurances will be current until Completion and, as far as the
Vendor is aware, nothing has been done or omitted to be done which will make any policy of
insurance void or voidable or materially increase the premiums payable under any policy.
	 
	13.2  	There are no outstanding material Claims made by a Group Company under any past or present
policy of any Group Company and no circumstances are known which could lead to a claim being
made.
	 
	13.3  	No Group Company has received any notice from an insurer affecting its insurances.
	 
	13.4  	The particulars of the insurance policies effected for the benefit of each Group Company
which are set out in the Due Diligence Materials are complete and accurate.

Warranty 14 — Properties

General

	14.1  	The particulars of the Properties are true and correct in all respects.

			
	 	 	 
	

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	14.2  	The Properties are the only land and buildings owned, used or occupied by the Group Company.
	 
	14.3  	The Group Companies have exclusive occupation and right of quiet enjoyment of each of the
Properties.
	 
	14.4  	No notices have been received by a Group Company and there is no order, declaration, report,
recommendation or approved proposal of a public authority or government department which would
materially affect the use of any of the Properties.
	 
	14.5  	No breach of planning legislation or of any by-laws, building regulations or other relevant
legislation has, as far as the Vendor is aware, been committed in relation to any Property.
No notice has been issued or injunction granted or applied for in respect of any breach or
alleged breach of planning control or of any by-laws, building regulations or other relevant
legislation.

Freehold Properties

	14.6  	In relation to those Properties, listed in Schedule 4, which are real property owned by the
Group (Freehold Properties):

	 	(a)  	the Subsidiary is the registered holder and beneficial owner of the Freehold
Properties;
	 
	 	(b)  	all rates, taxes and levies (including land tax) applicable to the Freehold
Properties have been paid; and
	 
	 	(c)  	the Subsidiary has not sold, agreed to sell, granted any option to sell, lease
or sublease or agreed to lease or sublease any of the Freehold Properties.

Leasehold Properties

	14.7  	In relation to the Properties, listed in Schedule 4, which are leased by the Company
(Leasehold Properties):

	 	(a)  	there are no subsisting material breaches of the leases of the Leasehold
Properties (Property Leases); and
	 
	 	(b)  	no Group Company has received a notice of any breach of the Property Leases.

	14.8  	The Property Leases:

	 	(a)  	are valid and subsisting; and
	 
	 	(b)  	have not been amended or modified.

Mining Lease

	14.9  	The Mining Lease has not been varied.
	 
	14.10  	No notices have been given or received under the Mining Lease and there are no subsisting
disputes involving the Mining Lease and as far as the Vendor is aware there is no material
fact, matter or circumstance likely to give rise to any Claim or Liability under the Mining
Lease.
	 
	14.11  	All rent, royalties, fees and outgoings payable under the Mining Lease have been paid.
	 
	14.12  	There has been no breach of clause 5C.1 of the Goldamere Deed.

Warranty 15 – Plant and Equipment

	15.1  	The machinery and plant, including fixed plant and machinery, and all vehicles and office
equipment owned by the Subsidiary as at the Completion Date:

	(a)  	are in good repair and condition (subject to fair wear and tear);
	 
	(b)  	are in satisfactory working order;

			
	 	 	 
	

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	 	(c)  	are and are maintained in accordance with industry best practice standards;
	 
	 	(d)  	have been properly serviced; and
	 
	 	(e)  	are not surplus to the Subsidiary’s requirements.

Warranty 16 — Environment

	16.1  	As far as the Vendor is aware, the Subsidiary has not received any notice or other
communication that notifies or alleges that it is in breach of any Environmental Law or
Environmental Authorisation, or that any Environmental Authorisation may be subject to
modification, suspension or revocation. As far as the Vendor is aware, there are no
circumstances likely to give rise to any breach, modification, suspension or revocation of an
Environmental Authorisation.
	 
	16.2  	There is no charge or covenant against or over the Land or assets of the Subsidiary in favour
of any relevant environmental protection authority as security for the clean-up or other costs
under any relevant Environmental Law.
	 
	16.3  	All Environmental Authorisations required to be held by the Subsidiary have been obtained,
are in full force and effect, have been complied with at all times.
	 
	16.4  	As far as the Vendor is aware, the Subsidiary has complied with all Environmental Laws and
all Environmental Authorisations.
	 
	16.5  	As far as the Vendor is aware, no aspect of the Subsidiary’s or any former owner or
occupier’s occupation or use of any of the Properties could give rise to loss, liability,
claims, prosecutions or legal proceedings against the Subsidiary as owner or occupier of the
Properties.
	 
	16.6  	The Subsidiary has not taken any action with respect to the Properties, which has aggravated
or extended the Subsidiary’s liability under an Environmental Law for any contamination,
pollutant or pollution on the Properties that may have been caused by past operations of a
former occupier of the Properties.

Warranty 17- Compliance with statutory requirements

	17.1  	As far as the Vendor is aware:

	 	(a)  	the Group holds all statutory leases, licences, consents, approvals and
authorisations necessary for carrying on the Business and the use of the Property;
	 
	 	(b)  	each Group Company has complied with the terms of those leases, licences,
consents, approvals and authorisations; and
	 
	 	(c)  	there are no facts which could prejudice renewal or lead to revocation or
variation in any material respect of those leases, licences, consents, approvals and
authorisations.

	17.2  	Each Group Company has complied at all times with all current laws and codes of practice
concerning all matters pertaining to its affairs including the conduct of the Business and:

	 	(a)  	the protection of human health; and
	 
	 	(b)  	the conditions of the work place.

	17.3  	There are no outstanding notices or orders affecting a Group Company or the Business and the
Vendor is not aware of any circumstance which may reasonably result in the imposition of any
such notice or order.

			
	 	 	 
	

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	17.4  	As far as the Vendor is aware, there have not been and are not pending, or in existence, any
investigations or enquiries by, or on behalf of, any Governmental Authority in respect of any
of the affairs of any Group Company.
	 
	17.5  	The Subsidiary has not paid any commission or made any payment whether to secure business or
otherwise, to any person, firm or company which in the hands of such person, firm or company
would, in accordance with the relevant law be illegal.
	 
	17.6  	As far as the Vendor is aware, no director, officer, agent, employee or other person acting
on behalf of any Group Company has been party to the use of any assets of the Group Company
for unlawful contributions, gifts, entertainment or other unlawful expenses relating to any
activity, including any political activity, or to the establishment or maintenance of any
unlawful or unrecorded fund of monies or other assets, or to the making of any false or
fictitious entries in the books or records of a Group Company, or to the making of any
unlawful payment.

Warranty 18 — Related party contracts

	18.1  	No Group Company is a party to any contract or arrangement in which the Vendor or any
Associate of the Vendor is interested, directly or indirectly, nor has there been any such
contract or arrangement at any time during the six years up to the date of this agreement.
	 
	18.2  	No Group Company is a party to, nor have its profits or financial position during the three
financial years ending on the Accounts Date been affected by, any contract or arrangement
which is not of an entirely arms length nature.
	 
	18.3  	Neither the Vendor nor any Associate of the Vendor is a party to any outstanding agreement or
arrangement for the provision of finance, goods, services or other facilities to or by any
Group Company or in any way relating to any Group Company or its affairs. Since the Accounts
Date no amount has been paid pursuant to any such agreement or arrangement and the amount
payable up to Completion is not more than US$419,682.
	 
	18.4  	In this Warranty 18, Associate has the meaning given to that term by section 318 of the
Income Tax Assessment Act 1936.

Warranty 19 – Intellectual property, information technology and confidential information

	19.1  	In warranty 19:
	 
	   	Intellectual Property Rights means all and any patents, patent applications, trade marks,
service marks, trade names, registered designs, unregistered design rights, copyrights, know
how, trade secrets, domain names, internet addresses, rights in confidential information,
and all and any other intellectual property rights, whether registered or unregistered, and
including all applications and rights to apply for any of the same.
	 
	19.2  	No activities of the Subsidiary (or of any licensee under any licence granted by a Group
Company) infringe or are likely to infringe any Intellectual Property Rights of any third
party and, as far as the Vendor is aware, no claim has been made against the Subsidiary or any
such licensee in respect of such infringement.
	 
	19.3  	Details of all registered Intellectual Property Rights (including applications to register
the same) and all commercially significant unregistered Intellectual Property Rights owned or
used by the Subsidiary are set out in the Due Diligence Materials.
	 
	19.4  	The Subsidiary is the sole legal and beneficial owner of or applicant for the Intellectual
Property Rights referred to in clause 19.5 free of any Encumbrance.

			
	 	 	 
	

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	19.5  	Details are set out in the Due Diligence Materials of all material licences and other
agreements relating to Intellectual Property Rights to which the Subsidiary is a party
(whether as licensor or licensee) or which relate to any Intellectual Property Rights owned by
the Subsidiary. The Subsidiary is not in breach of any such agreement, and as far as the
Vendor is aware, no third party is in breach of any such agreement.
	 
	19.6  	The Subsidiary owns or has licensed to it all Intellectual Property Rights it requires to
carry on the Business as such business has been carried on during the year prior to the date
of this agreement. These rights will not be affected by the acquisition of the Shares by the
Purchaser.
	 
	19.7  	The Vendor is not aware of any unauthorised use by any person of any Intellectual Property
Rights or confidential information of the Subsidiary.
	 
	19.8  	As far as the Vendor is aware, no Group Company nor any predecessor in the Business has at
any time disclosed to any person other than the Purchaser any of the following:

	 	(a)  	any secret or confidential information or property of the Subsidiary, including
(without limitation) financial information, trade secrets, plans, statistics,
documents, files, client lists, marketing information, records and papers;
	 
	 	(b)  	any other information relating to the Business which could reasonably cause
loss or damage to, or have a material adverse affect on the Business; or
	 
	 	(c)  	any secret or confidential information relating to any customers, clients,
employees and agents of the Business or to any other person who has or has had any
dealings with it,

	   	except as required by law, to a Group Company’s professional advisor, during the ordinary
course of business or during the course of due diligence investigations, such disclosure or
due diligence investigations taking place subject to an obligation of confidentiality.
	 
	19.9  	The Vendor has disclosed to the Purchaser, in the Due Diligence Materials, all information
technology which the Subsidiary owns or uses in order to carry on the Business, as well as the
basis of that ownership. It has disclosed to the Purchaser in writing all lease, hire and
other arrangements relating to that information technology.
	 
	19.10  	All the records and systems (including computer systems) and all data and information of a
Group Company are recorded, stored, maintained, operated or held exclusively by a Group
Company. They are not wholly dependent on any facilities or means (including any electronic,
mechanical or photographic process, computerised or otherwise) which are not under the
exclusive ownership and control of a Group Company. Any records for which a Group Company is
partly dependent on facilities or means not under its exclusive ownership and control, may be
obtained on the provision of reasonable notice at reasonable costs (eg photocopying, postage,
shipping etc).
	 
	19.11  	No Group Company has disclosed to any third party any of those records, control and other
systems, data or information referred to in paragraph 19.10.

			
	 	 	 
	

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Schedule 3  — Properties

Part A: Freehold Properties

	 	 	 
	Freehold Property:

	 	Volume 55114 Folio 1
	 
	 	 
	

	 	Volume 65928 Folio 1
	 
	 	 
	

	 	Volume 251431 Folio 1
	 
	 	 
	

	 	Volume 14503 Folio 1
	 
	 	 
	

	 	Volume 64188 Folio 1
	 
	 	 
	

	 	Volume 22140 Folio 1
	 
	 	 
	

	 	Volume 66530 Folio 1
	 
	 	 
	

	 	Volume 55114 Folio 2
	 
	 	 
	

	 	Volume 55114 Folio 3
	 
	 	 
	

	 	Volume 55117 Folio 243
	 
	 	 
	

	 	Volume 23483 Folio 2
	 
	 	 
	

	 	Volume 66530 Folio 2
	 
	 	 
	

	 	Volume 6887 Folio 101
	 
	 	 
	Registered proprietor:

	 	Goldamere Pty Limited ACN 073 634 581
	 
	 	 
	Mortgages:

	 	Real Property Mortgage granted by Goldamere
Pty Limited in favour of Societe Generale
dated 20 August 2004 in relation to the
freehold properties marked in italic text
above.
	 
	 	 
	

	 	Real Property Mortgage (Registered Mortgage No
C82324) granted by Goldamere Pty Limited in
favour of Arbutus Holding Limited in relation
to the freehold properties marked in italic
text above.

Part B: Leasehold Properties and Property Leases

	 	 	 
	Leasehold Property:

	 	58-60 Wilmot Street
	 
	 	 
	

	 	Burnie TAS 7320
	 
	 	 
	Property Lease dated:

	 	16 February 2001
	 
	 	 
	Lessor:

	 	I.R.M. Holdings Pty Limited (prior to 21 April
2004 the lessor was Braddon Securities Pty
Limited)
	 
	 	 
	Lessee:

	 	Goldamere Pty Limited
	 
	 	 
	Rent:

	 	$3,500 per month
	 
	 	 
	Term:

	 	3 years from 1 March 2001 to 1 March 2003 with
two options of 3 years each available to the
lessee. There are no written records of the
exercise by the Subsidiary of the option to
extend this lease.

			
	 	 	 
	

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	Rent review clause:

	 	Rent will increase yearly (except for the
first year of a renewed term) in accordance
with the Consumer Price Index for Hobart (all
groups), provided that the increase is no less
than 2% and no more than 5% of the amount
payable in the previous year.
	 
	 	 
	Change of control clause:

	 	None
	 
	 	 
	Leasehold Property:

	 	Suite 562/563,
	 
	 	 
	

	 	Level 5 Edgecliff Centre,
	 
	 	 
	

	 	203-233 New South Head Road,
	 
	 	 
	

	 	Edgecliff NSW 2027
	 
	 	 
	Property Lease dated:

	 	7 January 1999
	 
	 	 
	Lessor:

	 	Edgecliff Serviced Offices Pty Limited
	 
	 	 
	Lessee:

	 	Goldamere Pty Limited
	 
	 	 
	Rent:

	 	$2,750 per month
	 
	 	 
	Car Space License fee:

	 	$500 per month
	 
	 	 
	Term:

	 	12 months from 1 April 2004 to 31 March 2005
and thereafter month to month
	 
	 	 
	Rent review clause:

	 	The Lessor may increase the rent at any time
in accordance with the Consumer Price Index
for Sydney (all groups) and pass on to the
lessee any increases in taxes, rates and
outgoings applicable to the leased property.
After the expiration of the initial term or a
renewed term, the rent payable month to month
will be the rate applicable on the last day of
the expiring term plus 20%.
	 
	 	 
	Change of control clause:

	 	None

			
	 	 	 
	

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Signing page

	 	 	 
	EXECUTED as an agreement.
	 	 
	 
	 	 
	Executed by Ivanhoe Mines Ltd. by its attorney
Sebastian Hempel under power of attorney dated 3
February 2005 in the presence of
	 	 
	 
	“Sean Stabb”

	 	“Sebastian Hempel”
	 

	 	 
	Signature of witness

	 	Sebastian Hempel
	 
	 	 
	Sean Stabb
	 	 
	 
	 	 
	Name of witness (print)
	 	 
	 
	 	 
	Executed by Stemcor Pellets Ltd by its attorneys
Paul Whitehead under power of
attorney dated 3 February 2005 in the presence of
	 	 
	 
	 	 
	“Thomas Girgensohn”

	 	“Paul Whitehead”
	 

	 	 
	Signature of witness

	 	Paul Whitehead
	 
	 	 
	Thomas Girgensohn
	 	 
	 

	 	 
	Name of witness (print)

	 	Thomas Girgensohn

			
	 	 	 
	

	Minter Ellison | Ref: JSTH:AWDA 20-4747684
	 	Beviron Share Sale Agreement | page 39

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