Document:

Exhibit 10.5

EXECUTION VERSION

 

OMNIBUS
AMENDMENT AGREEMENT

among

MINERA SAN CRISTÓBAL, S.A.,

as Borrower

APEX SILVER MINES LIMITED,

APEX SILVER MINES SWEDEN AB,

APEX LUXEMBOURG S.A. R.L.,

APEX METALS GmbH,

APEX SILVER FINANCE LTD.,

APEX METALS MARKETING GmbH,

GOTLEX LAGERAKTIEBOLAG nr. 451,

organizational number 556702-1083,

COMERCIAL METALES BLANCOS AB,

BNP PARIBAS,

as Administrative Agent

BARCLAYS CAPITAL,

as Technical Agent

CORPORACIÓN ANDINA DE FOMENTO,

as a Senior Lender

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent and Securities Intermediary,

THE SENIOR LENDERS PARTY HERETO

and

THE HEDGE BANKS PARTY HERETO

Dated as of September 20, 2006

 

 

 

TABLE OF CONTENTS

	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
  ARTICLE I DEFINITIONS

  	
   

  	
  2

  
	
   

  	
   

  	
   

  
	
  Section 1.01.

  	
   

  	
  Defined Terms

  	
   

  	
  2

  
	
  Section 1.02.

  	
   

  	
  Interpretation

  	
   

  	
  3

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II REPRESENTATIONS AND WARRANTIES

  	
   

  	
  3

  
	
   

  	
   

  	
   

  
	
  Section 2.01.

  	
   

  	
  Organization

  	
   

  	
  3

  
	
  Section 2.02.

  	
   

  	
  Authority

  	
   

  	
  4

  
	
  Section 2.03.

  	
   

  	
  Binding Agreements; Proper Legal Form

  	
   

  	
  4

  
	
  Section 2.04.

  	
   

  	
  Consents and Approvals

  	
   

  	
  4

  
	
  Section 2.05.

  	
   

  	
  No Conflicts

  	
   

  	
  4

  
	
  Section 2.06.

  	
   

  	
  Ownership

  	
   

  	
  5

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III REORGANIZATION AMENDMENTS

  	
   

  	
  6

  
	
   

  	
   

  	
   

  
	
  Section 3.01.

  	
   

  	
  Common Security Agreement

  	
   

  	
  6

  
	
  Section 3.02.

  	
   

  	
  Transfer Restrictions Agreement

  	
   

  	
  20

  
	
  Section 3.03.

  	
   

  	
  Sponsor Pledge Agreement

  	
   

  	
  23

  
	
  Section 3.04.

  	
   

  	
  Cross-Guarantee and Security Agreement

  	
   

  	
  24

  
	
  Section 3.05.

  	
   

  	
  Hedge Guaranty

  	
   

  	
  26

  
	
  Section 3.06.

  	
   

  	
  Completion Agreement

  	
   

  	
  27

  
	
  Section 3.07.

  	
   

  	
  Project Document Guarantee (a)

  	
   

  	
  27

  
	
  Section 3.08.

  	
   

  	
  Project Document Guarantee (b)

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV ACQUISITION AMENDMENTS

  	
   

  	
  29

  
	
   

  	
   

  	
   

  
	
  Section 4.01.

  	
   

  	
  Consent to Acquisition

  	
   

  	
  29

  
	
  Section 4.02.

  	
   

  	
  Consent to Disbursement of Contingent Support
  Account

  	
   

  	
  30

  
	
  Section 4.03.

  	
   

  	
  Common Security Agreement

  	
   

  	
  31

  
	
  Section 4.04.

  	
   

  	
  Transfer Restrictions Agreement

  	
   

  	
  41

  
	
  Section 4.05.

  	
   

  	
  Sponsor Pledge Agreement

  	
   

  	
  42

  
	
  Section 4.06.

  	
   

  	
  Completion Agreement

  	
   

  	
  43

  
	
  Section 4.07.

  	
   

  	
  Project Document Guarantee (a)

  	
   

  	
  46

  
	
  Section 4.08.

  	
   

  	
  Consent to Increase in Service Fee

  	
   

  	
  47

  
	
  Section 4.09.

  	
   

  	
  AMM Cross-Guarantee and Security Agreement

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V CONDITIONS PRECEDENT

  	
   

  	
  48

  
	
   

  	
   

  	
   

  
	
  Section 5.01.

  	
   

  	
  Conditions Precedent to Reorganization

  	
   

  	
  48

  
	
  Section 5.02.

  	
   

  	
  Conditions Precedent to Acquisition

  	
   

  	
  51

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI MISCELLANEOUS

  	
   

  	
  53

  
	
   

  	
   

  	
   

  
	
  Section 6.01.

  	
   

  	
  Notices

  	
   

  	
  53

  
	
  Section 6.02.

  	
   

  	
  Expenses

  	
   

  	
  53

  
	
  Section 6.03.

  	
   

  	
  Counterparts; Integration

  	
   

  	
  53

  
	
  Section 6.04.

  	
   

  	
  Severability

  	
   

  	
  54

  
	
  Section 6.05.

  	
   

  	
  Governing Law; Jurisdiction; Service of Process;
  Etc.

  	
   

  	
  54

  

 

 i
 

 

 

	
  Section 6.06.

  	
   

  	
  WAIVER OF JURY TRIAL

  	
   

  	
  54

  
	
  Section 6.07.

  	
   

  	
  Headings

  	
   

  	
  54

  
	
  Section 6.08.

  	
   

  	
  Waivers; Amendment

  	
   

  	
  54

  
	
  Section 6.09.

  	
   

  	
  Successors and Assigns

  	
   

  	
  55

  
	
  Section 6.10.

  	
   

  	
  Limited Agreement

  	
   

  	
  55

  
	
  Section 6.11.

  	
   

  	
  Authorizations

  	
   

  	
  55

  

 

	
  APPENDIX A

  	
  -

  	
  Form of Apex Luxembourg Pledge of Silver Finance
  Shares

  
	
  APPENDIX B

  	
   

  	
  Form of Apex Sweden Pledge of Apex Metals Marketing
  Quotas

  
	
  APPENDIX C

  	
  -

  	
  Form of Apex Sweden Swiss Quota Pledge

  
	
  APPENDIX D

  	
  -

  	
  Form of Comercial Metales Blancos Swiss Quota Pledge

  
	
  APPENDIX E

  	
  -

  	
  Form of Comercial Metales Blancos Pledge of Apex
  Metals Marketing Quotas

  
	
  APPENDIX F

  	
  -

  	
  Form of Apex Sweden Pledge of Comercial Metales
  Blancos Shares

  
	
  APPENDIX G

  	
  -

  	
  Form of Apex Sweden Pledge of SC Minerals Sweden
  Shares

  
	
  APPENDIX H

  	
  -

  	
  Form of Apex Silver Finance Cross-Guarantee and
  Security Agreement

  
	
  APPENDIX I

  	
  -

  	
  Form of Assignment and Assumption Agreement

  
	
  APPENDIX J

  	
  -

  	
  Form of Sumitomo Completion Agreement

  
	
  APPENDIX K

  	
  -

  	
  Form of Sumitomo Transfer Restrictions Agreement

  
	
  APPENDIX L

  	
  -

  	
  Form of Sumitomo Pledge and Guarantee Agreement

  
	
  APPENDIX M-1

  	
  -

  	
  Form of Bolivian Opinion

  
	
  APPENDIX M-2-A, M-2-B - 

  	
  Forms of Cayman Islands
  Opinions

  
	
  APPENDIX M-3

  	
  -

  	
  Form of Swedish Opinion

  
	
  APPENDIX M-4

  	
  -

  	
  Form of Swiss Opinion

  
	
  APPENDIX M-5

  	
  -

  	
  Form of Borrower New York Opinion

  
	
  APPENDIX M-6

  	
  -

  	
  Form of Japanese Opinion

  
	
  APPENDIX M-7

  	
  -

  	
  Form of Sumitomo New York Opinion

  
	
  APPENDIX M-8

  	
  -

  	
  Form of Luxembourg Opinion

  
	
  APPENDIX N-1, N-2

  	
  -

  	
  Form of Apex Luxembourg Novations

  
	
  APPENDIX O-1, O-2

  	
  -

  	
  Form of ISDA Master Agreement Schedules

  
	
  APPENDIX P-1, P-2

  	
  -

  	
  Form of Apex Silver Finance Novations

  
	
  APPENDIX Q

  	
  -

  	
  Form of Apex Metals Marketing Management and
  Services Agreement

  
	
  APPENDIX R

  	
  -

  	
  Form of Borrower Concentrate Sales Agreement

  
	
  APPENDIX S

  	
  -

  	
  Form of Amended and Restated Borrower Management
  Services Agreement

  

 

 ii

 

This
OMNIBUS AMENDMENT AGREEMENT (this “Agreement”),
dated as of September 20, 2006, is entered into among MINERA SAN
CRISTÓBAL, S.A., a sociedad anónima
organized under the laws of Bolivia (the “Borrower”), APEX SILVER MINES LIMITED, an exempted company duly
incorporated with limited liability and validly existing under the laws of the
Cayman Islands (“ASM”),  APEX SILVER MINES SWEDEN AB, a privat aktiebolag organized under the laws of Sweden (“Apex
Sweden”), APEX LUXEMBOURG S.A. R.L., a société à responsabilité limitée organized under the laws of
Luxembourg (“Apex Luxembourg”), APEX METALS GmbH,
a company with limited liability organized under the laws of Switzerland (“Apex
Metals”), APEX SILVER FINANCE LTD., an
exempted company duly incorporated with limited liability and validly existing
under the laws of the Cayman Islands organized under the laws of the Cayman
Islands (“Apex Silver Finance”), APEX METALS MARKETING GmbH,
a company with limited liability organized under the laws of Switzerland (“Apex
Metals Marketing”), GOTLEX LAGERAKTIEBOLAG nr.
451, organizational number 556702-1083, a privat aktiebolag
organized under the laws of Sweden (“SC Minerals Sweden”), COMERCIAL METALES BLANCOS AB, a privat
aktiebolag organized under the laws of Sweden (“Comercial Metales Blancos”), BNP PARIBAS, a banking institution organized under the laws
of France as Administrative Agent for the Secured Parties (the “Administrative
Agent”), BARCLAYS CAPITAL, a public limited
company organized under the laws of England and Wales as Technical Agent (the “Technical
Agent”), CORPORACIÓN ANDINA DE FOMENTO, a
multilateral institution organized and existing pursuant to its Constitutive
Agreement signed in Bogotá, Colombia on February 7, 1968, as a Senior Lender, JPMORGAN CHASE BANK, N.A., a national banking corporation as
Collateral Agent (the “Collateral Agent”) as Securities Intermediary
(the “Securities Intermediary”), the SENIOR
LENDERS party hereto and the HEDGE BANKS
party hereto.

RECITALS

WHEREAS,
the Borrower, Apex Sweden, Apex Luxembourg, Apex Metals, the Administrative
Agent, the Technical Agent,  Corporación
Andina de Fomento, the Collateral Agent, the Securities Intermediary, the
Senior Lenders party thereto and the Hedge Banks party thereto are parties to
the Common Security Agreement, dated as of December 1, 2005 (as amended and
supplemented from time to time, the “Common Security Agreement”);

WHEREAS,
pursuant to the Common Security Agreement and the other Transaction Documents,
the Borrower and the other parties thereto agreed, among other things, to the
terms and conditions for the financing of the Project;

WHEREAS,
pursuant to the letter dated August 21, 2006 from ASM to the Administrative
Agent, ASM has requested from the Secured Parties approval to (a) reorganize
the group of ASM Affiliates involved in the Project and (b) allow Sumitomo to
acquire (i) indirectly, 35% of the outstanding shares of the Borrower, (ii)
indirectly, 35% of the outstanding quotas of Apex Metals Marketing (as
successor to Apex Metals’ rights and obligations with respect to the
Concentrate Sales Agreements under the Transaction Documents) and (iii)
directly,  35% of the outstanding shares
of Apex Silver Finance (as successor to Apex Metals’ rights and obligations
with respect to the Mandatory Metals Hedge Agreements under the Transaction
Documents);

 

 

WHEREAS,
the Secured Parties are willing to approve such transactions upon the terms and
conditions set forth herein;

NOW,
THEREFORE, in consideration of the mutual agreements herein contained and other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS

Section
1.01.          Defined Terms. Except as otherwise defined herein,
capitalized terms used in this Agreement shall have the meanings given thereto
in the Common Security Agreement (including Appendix A thereto). As used in
this Agreement, the following terms have the meanings specified below:

“Acquisition
Documents” means each of the Sumitomo Completion Agreement, the Sumitomo
Transfer Restrictions Agreement, the Sumitomo Pledge and Guarantee Agreement.

“Acquisition
Effective Date” has the meaning given to that term in Section 5.02.

“Assignment
and Assumption Agreement” means the Assignment and Assumption Agreement
between Apex Metals and Apex Metals Marketing of Apex Metals’ rights and
obligations under the Third Party Concentrate Sales Agreements, the
Cross-Guarantee and Security Agreement and the Project Document Guarantee
described in clause (b) of the definition of “Project Document Guarantee” in
the Common Security Agreement; substantially in the form of Appendix I hereto.

“Pledge
Agreements” means (a) the Pledge Agreement of Apex Luxembourg in favor of
the Collateral Agent in the form of Appendix A hereto of Apex Luxembourg’s
right, title and interest in the Apex Silver Finance Shares; (b) the Pledge
Agreement of Apex Sweden in favor of the Collateral Agent in the form of
Appendix B hereto of all of its right, title and interest in the Apex Metals
Marketing Quotas; (c) the Swiss Quota Pledge of Apex Sweden in favor of the
Collateral Agent in the form of Appendix C of its right, title and interest in
the Apex Metals Marketing Quotas; (d) the Swiss Quota Pledge of Comercial
Metales Blancos in favor of the Collateral Agent in the form of Appendix D
hereto of its right, title and interest in the Apex Metals Marketing Quotas;
(e) the Pledge Agreement of Comercial Metales Blancos in favor of the
Collateral Agent in the form of Appendix E hereto of all of its right, title
and interest in the Apex Metals Marketing Quotas; (f) the Pledge Agreement of
Apex Sweden in favor of the Collateral Agent in the form of Appendix F hereto
of its right, title and interest in the Comercial Metales Blancos Shares; and (g)
the Pledge Agreement of Apex Sweden in favor of the Collateral Agent in the
form of Appendix G hereto of its right, title and interest in the SC Minerals
Sweden Shares.

 2
 

 

 

“Reorganization
Documents” means this Agreement, the Apex Silver Finance Cross-Guarantee
and Security Agreement, each Pledge Agreement, the Assignment and Assumption
Agreement, and the novation agreements entered into by each of Apex Luxembourg
and Apex Silver Finance and the amended Mandatory Metals Hedge Agreements and
Schedules entered into by Apex Silver Finance as contemplated by Section
5.01(e) of this Agreement.

“Reorganization
Effective Date” has the meaning given to that term in Section 5.01.

“Sumitomo”
means Sumitomo Corporation, a corporation incorporated under the laws of Japan.

“Sumitomo
Completion Agreement” means a Sumitomo Completion Agreement among Sumitomo,
the Technical Agent, the Administrative Agent and the Collateral Agent
substantially in the form of Appendix J hereto.

“Sumitomo
Pledge and Guarantee Agreement” means a Sumitomo Pledge and Guarantee
Agreement between Sumitomo and the Collateral Agent substantially in the form
of Appendix L hereto.

“Sumitomo
Transfer Restrictions Agreement” means a Sumitomo Transfer Restrictions
Agreement among Sumitomo, SC Minerals Sweden, Comercial Metales Blancos, the
Administrative Agent and the Collateral Agent substantially in the form of
Appendix K hereto.

Section 1.02.          Interpretation. The rules of interpretation set forth in
clauses (a) to (j) of Section 1.02 of the Common Security Agreement shall
apply, with necessary changes, to this Agreement as if set forth in full in
this Section 1.02.

ARTICLE II

REPRESENTATIONS AND WARRANTIES

Each of the Borrower, ASM, Apex Sweden, Apex
Luxembourg, Apex Metals, Apex Silver Finance, Apex Metals Marketing, SC
Minerals Sweden and Comercial Metales Blancos represents and warrants to the
Administrative Agent and the Collateral Agent for the benefit of the Secured
Parties that:

Section 2.01.          Organization. It
(a) is organized and validly existing and in good standing under the laws
of the jurisdiction of its incorporation; (b) has all requisite
organizational power and authority under the laws of the jurisdiction of its
formation to own its property and to carry on its business; and (c) is
duly qualified to do business in and is in good standing in all other
jurisdictions where necessary in light of the business it conducts and the
property it owns and intends to conduct and own and in light of the
transactions contemplated by this Agreement and the other Acquisition
Documents, Reorganization Documents, and Transaction Documents to which it is a
party, except where the failure to qualify could not reasonably be expected to
have a Material Adverse Effect.

 3
 

 

 

Section 2.02.          Authority. It has all requisite organizational power
and authority to enter into each Reorganization Document to which it is a party
and to incur and perform its obligations provided for herein and therein and to
grant the Secured Parties the security interests and Liens described in the
Security Documents to which it is a party.

Section 2.03.          Binding Agreements;
Proper Legal Form.

(a)           Each
Reorganization Document to which it is a party which has been executed and
delivered by it on or prior to the date hereof, has been duly authorized, executed
and delivered by it and constitutes its legal, valid and binding obligation
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles.

(b)           Each
Reorganization Document to which it is a party is in proper legal form under
the laws of Sweden, Switzerland, Luxembourg or the Cayman Islands, as
applicable, for the enforcement thereof against it under the laws of Sweden,
Switzerland, Luxembourg and the Cayman Islands, as applicable, and if this
Agreement were stated to be governed by such law, it would constitute the
legal, valid and binding obligation of it under such law, enforceable in
accordance with its terms subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors’ rights and to general equity principles;
and to ensure the legality, validity, enforceability or admissibility in
evidence of this Agreement in Sweden, Switzerland, Luxembourg and the Cayman
Islands, as applicable, it is not necessary that this Agreement or any other
document be filed or recorded with any court or other authority in Sweden,
Switzerland, Luxembourg or the Cayman Islands, as applicable, or that any stamp
or similar tax be paid in Sweden, Switzerland, Luxembourg or the Cayman
Islands, as applicable, on or in respect of this Agreement, except as specifically
provided in the legal opinions delivered in satisfaction of the conditions
precedent referred to in clause (e) of Section 5.02. The laws of Sweden,
Switzerland, Luxembourg or the Cayman Islands do not provide for or require any
filing, recording or registration of a security interest in any of the Pledged
Collateral as a condition of obtaining priority over a creditor that has
acquired a Lien thereon or over a receiver in bankruptcy.

Section 2.04.          Consents and
Approvals. All Authorizations and Government
Approvals which are necessary for (i) the execution and delivery by it of
this Agreement and the other Reorganization Documents to which it is a party
and (ii) the performance of its obligations hereunder and thereunder have
been obtained and are in full force and effect, and no other action by, and no
notice to or filing with, any Governmental Authority or other Person is
required for such execution, delivery or performance or enforceability, except
as specifically provided in the legal opinions delivered in satisfaction of the
conditions precedent referred to in clause (e) of Section 5.02; and all
fees and taxes required for the legality or enforceability of such documents
have been paid.

Section 2.05.          No Conflicts. The execution, delivery and performance by
it of each of the Reorganization Documents to which it is a party and the
consummation of the

 4
 

 

 

transactions
contemplated thereby do not and will not (i) violate any provision of its
Organizational Documents, any Authorization, any Government Rule or any
Government Approval applicable to it; (ii) conflict with, result in a
breach of or constitute a default under any Reorganization Document or any
indenture or loan or credit agreement to which it is a party or by which it or
its property may be bound or affected in any material respect; or
(iii) result in, or create any Lien (other than Liens specifically
permitted under the Financing Documents or the Reorganization Documents) upon
or with respect to any of the properties now owned or hereafter acquired by it.

Section 2.06.          Ownership.

(a)           Prior
to execution of this Agreement, (i) ASM directly owns 100% of the issued and
outstanding share capital of Apex Luxembourg; (ii) Apex Luxembourg directly owns (A) 100%
of the issued and outstanding share capital of Apex Sweden, (B) 1 share of the
Borrower and (C) 0.20% of the issued and outstanding equity interests of Apex
Metals; (iii) Apex Sweden directly owns 88.19% of the issued and outstanding
share capital of the Borrower and 99.80% of the issued and outstanding equity
interests of Apex Metals; and (iv) Apex Metals directly owns 11.8% of the
issued and outstanding share capital of the Borrower and 100% of the issued and
outstanding share capital of the Service Company.

(b)           As
of the Reorganization Effective Date, (i) ASM directly owns 100% of the issued
and outstanding share capital of Apex Luxembourg; (ii) Apex Luxembourg directly
owns (A) 100% of the issued and outstanding share capital of Apex Sweden, (B)
100% of the issued and outstanding share capital of Apex Silver Finance and (C)
1 share of the Borrower; (iii) Apex Sweden directly owns (A) 64.99% of the
issued and outstanding share capital of the Borrower, (B) 65% of the issued and
outstanding share capital of Apex Metals Marketing, (C) 100% of the issued and
outstanding share capital of SC Minerals Sweden and (D) 100% of the issued and
outstanding share capital of Comercial Metales Blancos; (iv) SC Minerals Sweden
directly owns 35% of the issued and outstanding share capital of the Borrower;
and (v)  Comercial Metales Blancos
directly owns 35% of the issued and outstanding share capital of Apex Metals
Marketing.

(c)           As
of the Acquisition Effective Date, (i) ASM directly owns 100% of the issued and
outstanding share capital of Apex Luxembourg; (ii) Apex Luxembourg directly
owns (A) 100% of the issued and outstanding share capital of Apex Sweden, (B)
65% of the issued and outstanding share capital of Apex Silver Finance and (C)
1 share in the Borrower; (iii) Apex Sweden directly owns 64.99% of the issued
and outstanding share capital of the Borrower and 65% of the issued and
outstanding share capital of Apex Metals Marketing; (iv) SC Minerals Sweden
directly owns 35% of the issued and outstanding share capital of the Borrower;
(v) Comercial Metales Blancos directly owns 35% of the issued and outstanding
share capital of Apex Metals Marketing; and (vi) Sumitomo owns (A) 35% of the
issued and outstanding share capital of Apex Silver Finance, (B) 100% of the
issued and outstanding share capital of SC Minerals Sweden and (C) 100% of the
issued and outstanding share capital of Comercial Metales Blancos.

 5
 

 

 

ARTICLE III

REORGANIZATION AMENDMENTS

Subject
to the satisfaction of each of the conditions precedent specified in Section
5.01 below, but effective as of Reorganization Effective Date:

Section 3.01.          Common Security
Agreement. The provisions of the
Common Security Agreement shall be amended as follows:

(a)           Apex
Metals shall be removed as a party to the Common Security Agreement and
replaced with Apex Metals Marketing and Apex Silver Finance as detailed below;

(b)           Each
of Apex Silver Finance, Apex Metals Marketing, SC Minerals Sweden and Comercial
Metales Blancos shall be added as parties to the Common Security Agreement;

(c)           Section
3.06 shall be amended by deleting in each place where they appear in that
section the words “Apex Metals” and inserting in their place the words “SC
Minerals Sweden”;

(d)           Section
3.07 shall be amended by deleting in each place where they appear in that
section the words “Apex Metals” and inserting in their place the words “SC
Minerals Sweden”;

(e)           Section
3.08(b) shall be amended by inserting after the words “Apex Metals” in the
first line thereof the word “Marketing”;

(f)            Section
3.08(c) shall be amended by deleting in the first line of that section the
words “Apex Metals” and inserting in their place the words “SC Minerals Sweden”;

(g)           Section
3.12(e) shall be amended by deleting the words “Apex Metals” in the fifth line
thereof and inserting in their place the word “AMM”;

(h)           the
Senior Lenders and the Hedge Banks consent to the liquidation of Apex Metals,
the termination of the security interests in the Apex Metals Quotas provided
for in Section 3.13, and to the deletion of Section 3.13 in its entirety;

(i)            Section
3.13 shall be deleted in its entirety and replaced with the word “[Reserved.]”;

(j)            Section
3.14(a)(i) shall be amended by (i) deleting the word “and” in the first line
thereof and (ii) inserting after the words “Apex Metals” in the first line
thereof the words “Marketing, Apex Silver Finance, SC Minerals Sweden and
Comercial Metales Blancos”;

 6
 

 

 

(k)           Section
3.14(b) shall be amended by deleting the words “or Apex Sweden” in the ninth
line thereof and inserting the words “, Apex Sweden or SC Minerals Sweden” in
their place;

(l)            Section
3.14(c) shall be amended by (i) deleting the word “Neither” and replacing it
with the words “None of” and (ii) deleting the words “or Apex Metals” in the
first line thereof and inserting the words “, Apex Metals Marketing, Apex
Silver Finance, SC Minerals Sweden and Comercial Metales Blancos” in their
place;

(m)          Section
3.14(f) shall be amended by (i) deleting the word “and” in the second line
thereof and (ii) inserting after the words “Apex Sweden,” in the second line
thereof the words “Apex Metals Marketing, SC Minerals Sweden and Comercial
Metales Blancos”;

(n)           Section
3.15 shall be amended by (i) deleting all references to the term “Apex Metals”
in the fifth line of clause (a) and in clause (a)(v) and replacing it with the
words “Apex Metals Marketing, SC Minerals Sweden and Comercial Metales Blancos”;
(ii) deleting each reference to the term “Apex Metals Quotas” in clauses
(a)(iv) and (a)(v) and replacing it with the words “Apex Metals Marketing
Quotas or Apex Silver Finance Shares”; (iii) deleting each reference to the
term “Service Company Shares” in clauses (a)(iv) and (a)(v); (iv) deleting the
term “Apex Metals Subordinated Debt” in clause (a)(vi)(B) and inserting in its
place the terms “AMM Subordinated Debt and Apex Silver Finance Subordinated
Debt”, in each case together with appropriate conforming changes; (v) deleting
the references to “Apex Metals” in clause (a)(vi)(C) and inserting in their
place the words “Apex Metals Marketing”; (vi) deleting the word “or” in the
third line of clause (b); and (vii) inserting the words “Apex Silver Finance,
Apex Metals Marketing, SC Minerals Sweden or Comercial Metales Blancos” in the
third and fifth lines of clause (b) after the words “Apex Sweden”;

(o)           Section
3.17 shall be amended by deleting the term “Apex Metals” in the fourth line
thereof and inserting in its place the words “Apex Metals Marketing and Apex
Silver Finance”;

(p)           Section
3.18 shall be amended by deleting the words “Apex Metals” each time they appear
in such section and inserting in its place the words “Apex Silver Finance, Apex
Metals Marketing, SC Minerals Sweden, Comercial Metales Blancos”;

(q)           Section
3.19 shall be amended by (i) deleting the term “Apex Metals” each time it
appears in such section and inserting in its place the words “Apex Silver
Finance, Apex Metals Marketing, SC Minerals Sweden, Comercial Metales Blancos”
and (ii) inserting after the term “Apex Luxembourg” in clause (f) therein the
words “Apex Silver Finance, Apex Metals Marketing, SC Minerals Sweden,
Comercial Metales Blancos”, in each case with appropriate conforming changes;

(r)            Section
3.20 shall be amended in its entirety to read as follows:

“3.20 Subrogation. Apex
Luxembourg, Apex Sweden, SC Minerals Sweden and Comercial Metales Blancos shall
not exercise, and

 7
 

 

 

each of Apex Luxembourg, Apex Sweden, SC Minerals
Sweden and Comercial Metales Blancos hereby irrevocably defers the exercise of,
any claim, right or remedy that it may now have or may hereafter acquire
against the Borrower, Apex Metals Marketing or Apex Silver Finance arising
under or in connection with this Agreement or any other Security Document,
including, without limitation, any claim, right or remedy of subrogation,
contribution, reimbursement, exoneration, indemnification or participation arising
under contract, by applicable law or otherwise in any claim, right or remedy of
the Collateral Agent or the other Secured Parties against the Borrower, Apex
Metals Marketing, Apex Silver Finance or any other Person or any Collateral
which the Collateral Agent or any other Secured Party may now have or may
hereafter acquire, until the indefeasible payment and satisfaction in full of
all Secured Debt Obligations. If, notwithstanding the preceding sentence, any
amount shall be paid to Apex Luxembourg, Apex Sweden, SC Minerals Sweden or
Comercial Metales Blancos on account of such subrogation rights at any time
when any of the Secured Debt Obligations shall not have been paid in full, such
amount shall be held by such Person in trust for the Collateral Agent and the
other Secured Parties, segregated from other funds of such Person and be turned over to the Collateral Agent in the exact
form received by such Person (duly endorsed by such Person to
the Collateral Agent, if required), to be applied against the Secured Debt
Obligations, whether matured or unmatured, in accordance with the Financing
Documents.”

(s)           Section
4.01(a) shall be amended by deleting the words “and in the case of the Apex
Metals Account, Apex Metals” in the first parenthetical of such section and
inserting in its place the words “and in the case of the AMM Account, Apex
Metals Marketing”;

(t)            Section
4.01(b)(ii) shall be amended by deleting the term “Apex Metals
Account” and inserting in its place the term “AMM Account”;

(u)           all
other references in the Common Security Agreement (including in Sections
3.12(c), 4.02(c), 4.02(d), 4.02(f), 4.02(h), 4.03, 4.04, 4.05, 4.07, 4.09(b),
4.14, 5.05, 5.08 and 9.01) to the defined term “Apex Metals Account” shall be
replaced with the defined term “AMM Account”;

(v)           each
of Sections 4.01(c), 4.01(d), 4.01(e), 4.01(f), 4.01(g), 4.01(h), 4.01(i),
4.02(c), 4.03, 4.04, 4.05, 4.12 and 4.14 shall be amended by deleting the
defined term “Apex Metals” each time it appears in such sections and inserting
in its place the words “Apex Metals Marketing”;

(w)          Section
4.02(d) shall be amended by deleting the term “Apex Metals” and inserting in
its place the term “Apex Silver Finance”;

 8
 

 

 

(x)            Section
4.02(h) shall be amended by (A) deleting the words “ or Apex Metals” in the
fifth line thereof and inserting in its place the words “, Apex Metals
Marketing or Apex Silver Finance” and (B) deleting the words “and Apex Metals”
in the penultimate clause thereof and inserting in their place the words “,
Apex Metals Marketing and Apex Silver Finance”;

(y)           Section
5.08 shall be amended by deleting the defined term “Apex Metals” and inserting
in its place the term “Apex Metals Marketing, SC Minerals Sweden, Comercial
Metales Blancos”;

(z)            Section
5.08(d) shall be amended by inserting the words “, SC Minerals Sweden” after
the term “Apex Sweden” in the second line thereof;

(aa)         Section
6.03(b) shall be amended by deleting the defined term “Apex Metals Document”
and inserting in its place the term “AMM Document or Apex Silver Finance Document”;

(bb)         Section
7.01(a)(ii) shall be amended by deleting the defined term “Apex Metals” in the
second line thereof and inserting in its place the words “SC Minerals Sweden”;

(cc)         Section
8.16 shall be amended by (i) deleting the defined term “Apex Metals” in the
second line thereof and inserting in its place the term “Apex Metals Marketing”;
and (ii) inserting the word “Borrower” before the term “Concentrate Sales
Agreement”;

(dd)         Section
8.19(b) shall be amended by deleting the words “Each of the Borrower, Apex
Luxembourg and Apex Sweden” each time they appear in the section and in each
case inserting in their place the words “The Borrower and each Subordinated
Lender”;

(ee)         Section
8.22 shall be revised by inserting after the words “Apex Sweden” in the fourth
line thereof the words “and SC Minerals Sweden”;

(ff)           Section
8.30 shall be amended by deleting the defined term “Apex Metals” in the first
line thereof and inserting in its place the words “Apex Metals Marketing, Apex
Silver Finance, SC Minerals Sweden, Comercial Metales Blancos”;

(gg)         Section
9.01(d) shall be amended by inserting after the word “Metals” in the second
line thereof the word “Marketing”;

(hh)         Section
10.01(h) shall be amended in its entirety to read as follows:

“(h)         Default under or Termination
of a Cross-Guarantee and Security Agreements. (i) A CGSA Default shall have occurred and be continuing;
(ii) a Cross-Guarantee and
Security Agreement shall
be terminated; (iii) a Cross-Guarantee and Security Agreement shall
have been declared in a final order of a court to be unenforceable against Apex

 9
 

 

Metals Marketing or Apex Silver Finance;
(iv) either Apex Metals Marketing or Apex Silver Finance shall have
repudiated its obligations under the Cross-Guarantee and Security Agreement to which it is a party; or (v) a default
shall have occurred under the Assignment and Assumption Agreement or any Pledge
Agreement;”

(ii)           Section
10.01(o)(iii) shall be deleted in its entirety;

(jj)           Section
10.01(u) shall be amended by (i) inserting after the word “Borrower” in clause
(ii) the words “Apex Metals Marketing” and (ii) deleting the defined term “Apex
Metals” and inserting in its place the term “Apex Silver Finance”;

(kk)         Sections
10.01(y) shall be amended by deleting the defined term “Apex Metals” and inserting
in its place the words “Apex Silver Finance, Apex Metals Marketing”;

(ll)           Section
10.01(aa) shall be amended by deleting the defined term “Apex Metals” each time
it appears in such section and inserting in its place the words “SC Minerals
Sweden”, with appropriate conforming changes;

(mm)       Section
10.01(bb) shall be amended by deleting the defined term “Apex Metals” and
inserting in its place the words “Apex Metals Marketing”;

(nn)         Section
10.01(cc) shall be amended by deleting the defined term “Cross-Guarantee and
Security Agreement” and inserting in its place the defined term “Apex Silver
Finance Cross-Guarantee and Security Agreement”;

(oo)         Section
10.01(ee) shall be amended in its entirety to read as follows:

“(ee)       Change in Control. Subject to the provisions of the Transfer
Restrictions Agreement:

(i)            (A) Prior to
Completion, the Sponsor shall cease to own directly 100% of the issued and
outstanding Apex Luxembourg Shares, (B) at any time after Completion, the
Sponsor shall cease to own directly at least 51% of the issued and outstanding
Apex Luxembourg Shares or (C) at any time, the Sponsor shall cease to
Control the Borrower, Apex Metals Marketing or Apex Silver Finance directly or
indirectly;

(ii)           (A) Apex
Luxembourg shall cease to own directly 100% of the issued and outstanding Apex
Sweden Shares, 100% of the Apex Silver Finance Shares and at least one share in
the Borrower or (B) Apex Luxembourg shall cease to Control Apex Sweden or
Apex Silver Finance directly or indirectly at any time;

(iii)          (A) Apex Sweden shall cease to own directly
64.99% of the issued and outstanding Borrower Shares, 65% of the issued and
outstanding Apex Metals Marketing Quotas, 100% of the SC Minerals

 10
 

 

 

Sweden Shares and 100% of
the Comercial Metales Blancos Shares, or (B) Apex Sweden shall cease to Control the Borrower directly or
indirectly at any time; or

(iv)          (A)
SC Minerals Sweden shall cease to own directly 35% of the issued and
outstanding Borrower Shares or (B) Comercial Metales Blancos shall cease to own
directly 35% of the issued and outstanding Apex Metals Marketing Quotas.

(pp)         Section
13.05 shall be amended by inserting after the words “Apex Metals” in the last
line thereof the words “Marketing or Apex Silver Finance”;

(qq)         Section
13.14 shall be amended by inserting after the words “Apex Metals” each time
they appear in such section the words “Marketing or Apex Silver Finance”;

(rr)           Section
14.10 shall be amended by inserting after the words “Apex Metals” each time
they appear in such section the words “Marketing, Apex Silver Finance, SC
Minerals Sweden, Comercial Metales Blancos,”;

(ss)         Section
15.01 shall be amended by deleting the words “Apex Metals Shares” in clause (d)
thereof and replacing them with the words “Apex Silver Finance Shares”);

(tt)           Section
15.08 shall be amended by (i) deleting lines three and four or clause (ii)
thereof and replacing them with the words “c/o Anders Skoldberg, Ernst &
Young AB, 401 82 Göteborg”; (ii) deleting clause (iv) thereof and (iii)
inserting the following clauses:

(iv)          If to
Apex Metals Marketing, to it at:

Apex Metals Marketing GmbH

c/o Juris Treuhand AG

Industriestrasse AG

CH-6304, Zug 

Switzerland

Tel:         (303)
839-5060

(888)
696-2739

Fax:         (303)
839-5097

with a copy to:

Apex Silver Mines Corporation

1700 Lincoln Street, Suite 3050

Denver, CO 80203

Tel:         (303)
839-5060

(888)
696-2739

Fax:         (303)
839-5097

 11
 

 

 

(v)                                 If to Apex Silver Finance, to it at:

Apex Silver Finance Ltd.

c/o Walkers SPV Limited

Walker House

Mary Street, P.O. Box 908GT

George Town, Grand Cayman

B.W.I.

Tel:         (303)
839-5060

(888)
696-2739

Fax:         (303)
839-5097

with a copy to:

Apex Silver Mines Corporation

1700 Lincoln Street, Suite 3050

Denver, CO 80203

Tel:         (303)
839-5060

(888)
696-2739

Fax:         (303)
839-5097;

(vi)                              If to SC Minerals Sweden, to it at:

Gotlex Lageraktiebolag nr. 451, organizational number 556702-1083

c/o Wistrand Advokatbyra

Lilla Bommen 1

S-411 04 Göteborg

Sweden

Tel:         (303) 839-5060

Fax:         (303) 839-5907

Attn:       Director

with a copy to:

Apex Silver Mines Corporation

1700 Lincoln Street, Suite 3050

Denver, CO 80203

Tel:         (303)
839-5060

(888)
696-2739

Fax:         (303)
839-5097;

(vii)                           If to Comercial Metales Blancos, to it at:

Comercial Metales Blancos AB

c/o Anders Skoldberg, Ernst & Young AB

401 82 Göteborg

Sweden

Tel:         (303) 839-5060

Fax:         (303) 839-5907

Attn:       Director

 12
 

 

with a copy to:

Apex Silver Mines Corporation

1700 Lincoln Street, Suite 3050

Denver, CO 80203

Tel:         (303)
839-5060

(888)
696-2739

Fax:         (303)
839-5097;

(uu)         Section
15.18 shall be amended by deleting the defined term “Apex Metals” each time it
appears in such section and inserting in its place the words “Apex Metals
Marketing, Apex Silver Finance, SC Minerals Sweden and Comercial Metales
Blancos”, with appropriate conforming changes;

(vv)         the
definition of “Affiliated Obligors” in Appendix
A thereto shall be amended in its entirety to read as follows: ““Affiliated Obligors” means, collectively, the Borrower, the
Sponsor, Apex Luxembourg, Apex Sweden, Apex Silver Finance, Apex Metals
Marketing, Comercial Metales Blancos and SC Minerals Sweden.”

(ww)       the definitions
of each of “Apex Metals”, “Apex Metals
Account”, “Apex Metals Documents”,
“Apex Metals Quotas”, “Apex Metals Subordinated Debt”, “Apex Metals
Subordinated Lender”, “Apex Metals Subordinated
Notes” and “Apex Metals Subordination
Agreement” shall be deleted in its entirety;

(xx)          the
definition of “Apex Metals Management and Services
Agreement” in Appendix A thereto shall be amended by (i) deleting
the words “dated December 1, 2005” and inserting in their place the words “in
the form of Appendix Q to the Omnibus Amendment Agreement” and (ii) replacing
the words “between Apex Metals” with “among Apex Metals Marketing, Apex Silver
Finance”;

(yy)         the
definition of “Apex Metals Net Payment Amount”
in Appendix A thereto shall be amended by deleting the term “Apex Metals” each
time it appears in such definition and inserting in its place the term “Apex
Silver Finance”;

(zz)          the
definition of “Apex Metals Obligations” in
Appendix A thereto shall be amended by deleting the defined term “Apex Metals”
in the first line thereof and inserting in its place the term “Apex Silver
Finance”.

(aaa)       the
definition of “Borrower Concentrate Sales Agreement”
in Appendix A thereto shall be amended by (i) deleting the words “dated
December 1, 2005” and inserting in their place the words “in the form of
Appendix R to the Omnibus Amendment Agreement”; and (ii) inserting after the
words “Apex Metals” in the second line thereof the word “Marketing”;

 13
 

 

 

(bbb)      the
definition of “CGSA Default” in Appendix A
thereto shall be amended by deleting the word “the” immediately before the
words “Cross-Guarantee and Security Agreement” and inserting in its place the
word “either”;

(ccc)       the
definition of “CGSA Secured Obligations” in
Appendix A thereto shall be amended by deleting the word “the” immediately
before the words “Cross-Guarantee and Security Agreement” and inserting in its
place the word “either”;

(ddd)      the
definition of “Concentrate Sales Guarantee” in
Appendix A thereto shall be amended by deleting the words “Apex Metals’” and
inserting the words “Apex Metals Marketing’s”;

(eee)       the
definition of “Contingent Support Contribution”
in Appendix A thereto shall be amended by deleting the term “Apex Metals
Account” in the second line thereof and inserting in its place the term “AMM
Account”;

(fff)         the
definition of “Cross-Guarantee and Security Agreement”
in Appendix A thereto shall be amended in its entirety to read “each of (a) the
AMM Cross-Guarantee and Security Agreement; and (b) the Apex Silver Finance
Cross-Guarantee and Security Agreement”;

(ggg)      the
definition of “Financing Documents” in Appendix
A thereto shall be amended in its entirety to read as follows: ““Financing Documents” means the Security Documents, the
Completion Agreement, the Transfer Restrictions Agreement, the Hedge Guaranty,
each Senior Loan Agreement, each Note, each PRI Policy, the Fee Letters and
each Reorganization Document.”

(hhh)      the
definition of “Guaranteed Apex Metals Early Termination
Amount” in Appendix A thereto shall be amended by deleting the term “Apex
Metals” each time it appears in such definition and inserting in its place the
term “Apex Silver Finance”;

(iii)          the
definition of “Historical Debt Service Coverage Ratio”
in Appendix A thereto shall be amended by deleting the term “Apex Metals” in
the third line thereof and inserting in its place the words “Apex Metals
Marketing and Apex Silver Finance”;

(jjj)          the
definition of “Intercompany Debt” in Appendix A
thereto shall be amended by (i) deleting the words “and Apex Metals
Subordinated Debt” and inserting in their place the words “, AMM Subordinated
Debt, Apex Silver Finance Subordinated Debt, SC Minerals Sweden Debt and
Comercial Metales Blancos Debt” and (ii) deleting the words “Service Company
Debt”;

(kkk)       the
definition of “Intercompany Lender” in Appendix
A thereto shall be amended by deleting the words “Apex Metals Subordinated
Lender and Service Company Lender” and inserting in their place the words “AMM
Subordinated Lender, Apex Silver Finance Subordinated Lender, SC Minerals
Sweden Subordinated Lender, Comercial Metales Blancos Subordinated Lender”;

 14
 

 

 

(lll)          the
definition of “Intercompany Note” in Appendix A
thereto shall be amended by deleting the words “Apex Metals Subordinated Note
and Service Company Note” and inserting in their place the words “AMM Note,
Apex Silver Finance Note, SC Minerals Sweden Note, Comercial Metales Blancos
Note”;

(mmm)    the
definition of “Liquidity Accounts” in Appendix A
thereto shall be amended by deleting the term “Apex Metals Account” and
inserting in its place the words “AMM Account”;

(nnn)      the
definition of “Mandatory Metals Hedge Agreements”
in Appendix A thereto shall be amended by replacing “Apex Metals” with “Apex
Silver Finance”;

(ooo)      the
definition of “Metals Hedge Transactions” in
Appendix A thereto shall be amended by deleting the words “Apex Metals” in the
parenthetical and inserting in their place the words “Apex Silver Finance”;

(ppp)      the
definition of “Operating Costs” in Appendix A
thereto shall be amended by deleting the words “or Apex Metals” in the third
line thereof and inserting in its place the words “, Apex Metals Marketing or
Apex Silver Finance”;

(qqq)      the
definition of “Project Document Guarantees” in
Appendix A thereto shall be amended by (i) deleting the words “and the
Collateral Agent” in clause (a) thereof, (ii) deleting the words “and the
Service Company’s obligations under the Borrower Management and Services
Agreement” in clause (a) thereof, (iii) inserting after the words “Services
Agreement” in the last line of clause (b) thereof the words “ and the Service
Company’s obligations under the Borrower Management and Services Agreement” and
(iv) inserting after the words “Apex Metals” in each of clauses (a) and (b)
thereof the word “Marketing”;

(rrr)         the
definition of “Project Funds” in Appendix A
thereto shall be amended by:

(i)            deleting
the term “Apex Metals” in clauses (a) and (j) thereof and inserting in its
place the words “Apex Metals Marketing and Apex Silver Finance”; and

(ii)           deleting
the term “Apex Metals” in clause (i) thereof and inserting in its place the
words “Apex Silver Finance”;

(sss)       the
definition of “Replacement Mandatory Metals Hedge
Transactions” in Appendix A thereto shall be amended by deleting the
words “Apex Metals” in the second line thereof and inserting in its place the
words “Apex Silver Finance”;

(ttt)         the
definition of “Security Documents” in Appendix A
thereto shall be amended by inserting after the words “Apex Metals” in the
seventh line the word “Marketing” and by inserting after the word “Agreement”
in the last line the words “or the Omnibus Amendment Agreement”;

 15
 

 

 

(uuu)      the
definitions of each of “Service Company Debt”,
“Service Company Lender”, “Service Company Note” and “Service
Company Shares” shall be deleted in its entirety;

(vvv)      the
definition of “Service Fee” shall be deleted by
deleting the words “Apex Metals” in clause (b) thereof and inserting in their
place the words “Apex Metals Marketing”;

(www)    the
definition of “Shareholder Debt” shall be
amended by adding after the term “Apex Sweden” the words “, SC Minerals Sweden
or Comercial Metales Blancos”;

(xxx)        the
definition of “Spot Sales Agreement” in Appendix
A thereto shall be amended by deleting the term “Apex Metals” in the third line
thereof and inserting in its place the words “Apex Metals Marketing”;

(yyy)      the
definition of “Subordinated Lender”
in Appendix A thereto shall be amended by inserting after the words “Apex
Metals” the word “Marketing” and by inserting after the words “Apex Luxembourg”
the words “Apex Silver Finance, SC Minerals Sweden, Comercial Metales Blancos”;

(zzz)        the
definition of “Third Party Concentrate Sales Agreement”
in Appendix A thereto shall be amended by deleting the term “Apex Metals” each
time it appears in such definition and inserting in its place the term “Apex
Metals Marketing”;

(aaaa)     the
following additional defined terms shall be inserted in Appendix A thereto:

“AMM Account”
has the meaning assigned to such term in Section 4.01(b)(ii).

“AMM Collateral”
has the meaning assigned to such term in the initial paragraph of Section 4 of
the AMM Cross-Guarantee and Security Agreement.

“AMM
Cross-Guarantee and Security Agreement” means the Cross-Guarantee
and Security Agreement executed by Apex Metals Marketing in favor of the
Collateral Agent for the benefit of the Secured Parties;

“AMM Documents”
means this Agreement, the Transfer Restrictions Agreement, the Apex Metals
Management and Services Agreement, each Third Party Concentrate Sales
Agreement, the Borrower Concentrate Sales Agreement, the AMM Cross-Guarantee and
Security Agreement and the Project Document Guarantee described in clause (b)
of the definitions thereof.

 16
 

 

 

“AMM Subordinated Debt”
means unsecured Indebtedness (including capitalized interest) of Apex Metals
Marketing, whether currently outstanding or hereinafter created, ranking in
payment and upon liquidation junior to the Secured Debt in accordance with the
subordination terms attached as Appendix A-2 to the Transfer Restrictions
Agreement, which is assigned and pledged as security for the Secured Debt
Obligations pursuant to a Security Document. No such indebtedness of Apex
Metals Marketing shall constitute AMM Subordinated Debt until such time as a
the holder thereof assumes in writing, either pursuant to the terms of a
Financing Document or otherwise, all of the obligations applicable to an AMM
Subordinated Lender under and in accordance with this Agreement and the AMM
Subordination Agreement.

“AMM Note” means
any promissory notes or other instruments of Apex Metals Marketing evidencing
AMM Subordinated Debt.

“AMM Subordinated Lender”
means any holder of AMM Subordinated Debt so long as it continues to hold such
AMM Subordinated Debt.

“AMM Subordination
Agreement” has the meaning set forth in Section 5.06(b) of the AMM
Cross-Guarantee and Security Agreement.

“Apex Metals Marketing”
means Apex Metals Marketing GmbH, a company with limited liability organized
under the laws of Switzerland.

“Apex Metals Marketing
Quotas” means the quotas of Apex Metals Marketing.

“Apex Silver Finance”
means Apex Silver Finance Ltd., an exempted company with limited liability
organized under the laws of the Cayman Islands.

“Apex Silver
Finance Cross-Guarantee and Security Agreement” means the
Cross-Guarantee and Security Agreement executed by Apex Silver Finance in favor
of the Collateral Agent for the benefit of the Secured Parties.

“Apex Silver Finance
Documents” means this Agreement, the Transfer Restrictions
Agreement, the Apex Silver Finance Cross-Guarantee and Security Agreement, each
Mandatory Metals Hedge Agreement and the Apex Metals Management and Services
Agreement.

“Apex Silver Finance Note”
means any promissory notes or other instruments of Apex Silver Finance
evidencing Apex Silver Finance Subordinated Debt.

 17
 

 

 

“Apex Silver Finance Shares”
means the shares of Apex Silver Finance.

“Apex Silver Finance
Subordinated Debt” means unsecured Indebtedness (including
capitalized interest) of Apex Silver Finance, whether currently outstanding or
hereinafter created, ranking in payment and upon liquidation junior to the Secured
Debt in accordance with the subordination terms attached as Appendix A-2 to the
Transfer Restrictions Agreement, which is assigned and pledged as security for
the Secured Debt Obligations pursuant to a Security Document. No such
indebtedness of Apex Silver Finance shall constitute Apex Silver Finance
Subordinated Debt until such time as the holder thereof assumes in writing,
either pursuant to the terms of a Financing Document or otherwise, all of the
obligations applicable to a Apex Silver Finance Subordinated Lender under and
in accordance with this Agreement and the Apex Silver Finance Subordination
Agreement.

“Apex Silver Finance
Subordinated Lender” means any holder of Apex Silver Finance
Subordinated Debt so long as it continues to hold such Apex Silver Finance
Subordinated Debt.

“Apex Silver Finance
Subordination Agreement” has the meaning set forth in Section
5.06(b) of the Cross-Guarantee and Security Agreement.

“Assignment and Assumption
Agreement” has the meaning assigned thereto in the Omnibus Amendment
Agreement.

“Comercial Metales Blancos”
means Comercial Metales Blancos AB, a privat aktiebolag
organized under the laws of Sweden.

“Comercial Metales Blancos
Debt” means unsecured Indebtedness (including capitalized interest)
of Comercial Metales Blancos, whether currently outstanding or hereinafter
created, which is assigned and pledged as security for the Secured Debt
Obligations pursuant to a Security Document.

“Comercial Metales Blancos
Note” means any promissory notes or other instruments of Comercial
Metales Blancos evidencing Comercial Metales Blancos Debt.

“Comercial Metales Blancos
Shares” means the shares of Comercial Metales Blancos.

“Comercial Metales Blancos
Subordinated Lender” means any holder of Comercial Metales Blancos
Debt so long as it continues to hold such Comercial Metales Blancos Debt.

 18
 

 

 

“Omnibus Amendment
Agreement” means the Omnibus Amendment Agreement dated as of
September 20, 2006 among the parties hereto.

“Pledge Agreements”
has the meaning assigned thereto in the Omnibus Amendment Agreement.

“SC Minerals Sweden”
means Gotlex Lageraktiebolag nr. 451, organizational number 556702-1083, a privat aktiebolag organized under the laws of Sweden.

“SC Minerals Sweden Debt”
means unsecured Indebtedness (including capitalized interest) of SC Minerals
Sweden, whether currently outstanding or hereinafter created, which is assigned
and pledged as security for the Secured Debt Obligations pursuant to a Security
Document.

“SC Minerals Sweden Note”
means any promissory notes or other instruments of SC Minerals Sweden
evidencing SC Minerals Sweden Debt.

“SC Minerals Sweden Shares”
means the shares of SC Minerals Sweden.

“SC Minerals Sweden
Subordinated Lender” means any holder of SC Minerals Sweden Debt so
long as it continues to hold such SC Minerals Sweden Debt.

(bbbb)    The
following defined terms shall be replaced as indicated wherever they appear in
the Common Security Agreement:

“Apex Metals
Management and Services Agreement” shall be replaced with “Apex Metals Marketing Management and Services
Agreement”;

“Apex Metals Net
Payment Amount” shall be replaced with “Apex Silver Finance Net Payment Amount”;

“Apex Metals Obligations”
shall be replaced with “Apex Silver Finance
Obligations”;

“Cash Flow
Prepayments” shall be replaced with “Cash Sweep Prepayments”;

“Eligible
Guaranteed Apex Metals Amount” shall be replaced with “Eligible Guaranteed Apex Silver Finance Amount”;

 19
 

 

 

“Guaranteed Apex
Metals Early Termination Amounts” shall be replaced with “Guaranteed Apex Silver Finance Early Termination
Amounts”;

“Guaranteed Apex
Metals Net Payment Amounts” shall be replaced with “Guaranteed Apex Silver Finance Net Payment Amounts”;

“Guaranteed Apex
Metals Obligations” shall be replaced with “Guaranteed Apex Silver Finance Obligations”;

Section 3.02.          Transfer Restrictions
Agreement. The provisions of the
Transfer Restrictions Agreement shall be amended as follows:

(a)           Apex
Metals shall be removed as a party to the Transfer Restrictions Agreement;

(b)           recital
“C” shall be amended by deleting the words “one quota of Apex Metals in the
amount of 1,000 Swiss Francs” in the second line thereof and inserting in their
place the words “100% of the outstanding share capital of Apex Silver Finance”;

(c)           recital
“D” shall be amended by deleting the text in its entirety and inserting in its
place the words “Apex Sweden directly owns 64.99% of the outstanding share
capital of the Borrower, 65% of the outstanding share capital of Apex Metals
Marketing, 100% of the outstanding share capital of SC Minerals Sweden and 100%
of the outstanding share capital of Comercial Metales Blancos.”;

(d)           recital
“E” shall be deleted in its entirety and replaced with the word “[Reserved.]”;

(e)           recital
“F” shall be amended by (i) replacing the comma after the words “Apex Sweden”
in the first lien thereof with the word “and”, (ii) deleting the words “and
Apex Metals” from the first line thereof and (iii) replacing the word “Metals”
in the last line thereof with the words “Silver Finance”;

(f)            the
definition of “Apex Metals Subordination Conditions”
shall be deleted in its entirety.

(g)           the
definition of “Shareholder Party” shall be
amended by deleting the words “and Apex Metals”, with appropriate conforming
changes;

(h)           the
following additional definitions shall be inserted in Section 1.01:

“AMM Subordination
Conditions” shall mean subordination conditions of Apex Metals
Marketing substantially in the form of Appendix A-2 hereto.

 20
 

 

 

“Apex Silver Finance
Subordination Conditions” shall mean subordination conditions of
Apex Silver Finance substantially in the form of Appendix A-2 hereto.”;

(i)            Section
2.01(a)(ii) shall be amended by deleting the words “Apex Metals” in clause (B)
thereof and inserting in its place the words “Apex Silver Finance”;

(j)            Section
2.01(a)(iii) shall be amended by deleting the words “Apex Metals, or (C)” in
clause (B) thereof and inserting in its place the words “Apex Metals Marketing,
(C) any Interest in SC Minerals Sweden, (D) any Interest in Comercial Metales
Blancos, or (E)”;

(k)           Section
2.01(a)(iv) shall be amended in its entirety to read “the Sponsor shall not
permit (A) SC Minerals Sweden to transfer any Interest in the Borrower or (B)
Comercial Metales Blancos to transfer any Interest in Apex Metals Marketing”;

(l)            Section
2.01(b) shall be amended in its entirety to read as follows:

“(b)         Prior
to Completion, except for the grant of security interests to the Collateral
Agent for the benefit of the Secured Parties pursuant to the Security Documents
(or the exercise by the Collateral Agent of remedies thereunder), no Transfer
to any Permitted Affiliated Assignee referred to in clause (a) above shall be
made without the prior written consent of the Majority Secured Parties.”

(m)          the
last paragraph of Section 2.01 shall be amended by deleting the words “Apex
Metals” in the third line thereof and inserting in its place the words “Apex
Metals Marketing, Apex Silver Finance, SC Minerals Sweden and Comercial Metales
Blancos”;

(n)           Section
2.02 shall be amended by:

(i)            deleting
the words “Apex Metals” each time they appear in each of clauses (b), (e)(ii),
(A)(2), A(3) and (A)(8)  thereof and
inserting in its place the words “Apex Metals Marketing”;

(ii)           deleting
in each of clauses (c) and (e)(iii) the words “the Service Company” and
inserting in its place the words “Apex Silver Finance”;

(iii)          deleting
the term “Apex Metals Subordinated Debt” each time its appears in section
(A)(5) and inserting in its place “AMM Subordinated Debt”;

(iv)          deleting
immediately before clause (A)(8) the word “and” inserting after the end of
clause (A)(8) the following additional clause: “(9) Interests in Apex Silver
Finance representing greater than 50% of the total outstanding Interest in Apex
Silver Finance; and (10) Apex Silver Finance Subordinated Debt representing
greater than 50% of the total outstanding Apex Silver Finance Subordinated Debt”;

(v)           deleting clause (C) in
its entirety;

 21

 

(o)           Section
2.04(a) shall be amended by deleting the words “Apex Metals, the Service
Company” in the second line thereof and inserting in their place the words “Apex
Metals Marketing and Apex Silver Finance”;

(p)           Section
2.04(b) shall be amended by (A) deleting the words “Apex Metals Subordinated
Debt” each time they appear in the section and inserting in their place the
words “AMM Subordinated Debt, Apex Silver Finance Subordinated Debt”, including
appropriate conforming changes and (B) deleting the term “Apex Metals
Subordination Conditions in the penultimate line thereof and inserting in its
place the words “AMM Subordination Conditions or Apex Silver Finance
Subordination Conditions”;

(q)           Section
3.02(b) shall be amended in its entirety to read “each of its representations
and warranties set forth in Section 2.06(b) of the Omnibus Amendment Agreement
is true and correct on and as of the date hereof.”;

(r)            Section
3.02(k) shall be amended by inserting before the words “fully perfected” in the
sixth line thereof the words “upon making all of the appropriate registrations
and filings,”;

(s)           Section
3.03 shall be deleted in its entirety;

(t)            Section
3.04(c) shall be amended in its entirety to read “The Sponsor agrees to be
bound by the terms of each of the AMM Subordination Conditions and the Apex
Silver Finance Subordination Conditions with respect to all amounts owing to it
from Apex Metals Marketing or Apex Silver Finance.”;

(u)           Section
3.05 shall be amended by (i) deleting the references to “Apex Metals” each time
it appears in clauses (c), (f), (g) and (h) thereof and inserting in its place
the words “Apex Silver Finance”, (ii) deleting all other references to the
terms “Apex Metals” each time it appears in such section and deleting all
references to “Apex Metals Organizational Documents” each time it appears in
such section, with appropriate conforming changes and (iii) deleting the
reference to “the Service Company” in clause (h) thereof;

(v)           Section
3.06 shall be amended by (i) deleting all references to the terms “Apex Metals”
each time it appears in such section and inserting in its place the term “Apex
Metals Marketing” and (ii) deleting all references to the term “Apex Metals
Organizational Documents” each time it appears in such section, with appropriate
conforming changes;

(w)          Section
3.07 of the Transfer Restrictions Agreement is deleted in its entirety.

(x)            Section
4.01(iii) shall be amended by inserting after the parenthetical therein the
words “or under Section 4.01 of the Pledge Agreement of Apex Luxembourg of its
right, title and interest in the Apex Silver Finance Shares;

 22
 

 

 

(y)           Section
4.01(v) shall be amended by inserting after the parenthetical therein the words
“or under or under Section 4.01 of (A) the Pledge Agreement of Apex Sweden of
its right, title and interest in the Apex Metals Marketing Quotas, (B) the
Pledge Agreement of Apex Sweden of its right, title and interest in Comercial
Metales Blancos Shares or (C) the Pledge Agreement of Apex Sweden of its right,
title and interest in SC Minerals Sweden Shares”;

(z)            Section
4.01(b)(vii) shall be amended by deleting the words “or Section 7.07 hereof”;

(aa)         the
last paragraph of Section 5.05 shall be amended by deleting the words “or Apex
Metals” in the second line thereof;

(bb)         Exhibit
A-1 thereto shall be amended by (i) inserting the word “Marketing” after the
words “Apex Metals” in the definitions of “Affiliate Permitted Obligations” and
“Subordinated Obligations” and (ii) inserting after the words “Apex Sweden” in
the definition of “Subordinated Obligations” the words “, Apex Silver Finance,
SC Minerals Sweden”; and

(cc)         Exhibit
A-2 thereto shall be amended by deleting the term “Apex Metals” each time it
appears in such exhibit and inserting in its place the words “[Apex Metals
Marketing/Apex Silver Finance]”, with appropriate conforming changes.

Section
3.03.          Sponsor
Pledge Agreement. The provisions of
the Sponsor Pledge Agreement shall be amended as follows:

(a)           recital
“B” shall be amended by deleting the words “Apex Metals GmbH (“Apex Metals”) in the first line thereof and inserting in its
place the words “Apex Silver Finance Ltd. (“Apex Silver Finance”)
and deleting the words “Apex Metals” in the third line thereof and inserting in
its place the words “Apex Silver Finance”;

(b)           recital
“C” shall be amended by deleting the words “quotas of Apex Metals” in the
fourth line thereof and inserting in their place the words “shares of Apex
Silver Finance”;

(c)           the
definition of “Restricted Subsidiary” in the Sponsor Pledge Agreement shall be
amended by adding after the words “the Borrower” in the second line thereof the
words “, Apex Metals Marketing and Apex Silver Finance”;

(d)           Section
3.02(a) shall be amended by deleting the words “or the Service Company, as the
case may be”;

(e)           Section
3.02(c) shall be amended by deleting the term “Apex Metals Account” in the
sixth line thereof and inserting in its place the words “AMM Account”; and

 23
 

 

 

(f)            Section
4.12 shall be amended by deleting the words “Apex Metals” in the fifth line
thereof and inserting in its place the words “Apex Silver Finance”.

Section 3.04.          Cross-Guarantee and
Security Agreement. The provisions
of the Cross-Guarantee and Security Agreement shall be amended as follows:

(a)           Apex
Metals shall be removed as a party to the Cross-Guarantee and Security
Agreement;

(b)           Apex
Metals Marketing shall be the guarantor under the Cross-Guarantee and Security
Agreement, with appropriate conforming changes to the introductory paragraph
thereof, including the definition of “Guarantor”;

(c)           the
defined term “Apex Metals Collateral” shall be deleted each time it appears in
the agreement (including Section 3.06 and the introductory paragraph of Section
4) and replaced in each instance with the term “AMM Collateral”.

(d)           the
defined term “Apex Metals Documents” shall be deleted each time it appears in
the agreement (including Sections 3.01, 3.02, 3.03, 3.04 and 3.05) and replaced
in each case with the term “AMM Documents”, with appropriate conforming
changes;

(e)           the
defined term “Apex Metals Management and Services Agreement” shall be deleted
each time it appears in the agreement and replaced in each case with the term “Apex
Metals Marketing Management and Services Agreement”;

(f)            the
defined term “Apex Metals Subordinated Debt” shall be deleted each time it appears
in the agreement (including Section 3.14) and replaced in each instance with
the term “AMM Subordinated Debt”;

(g)           the
defined term “Apex Metals Subordinated Lender” shall be deleted each time it
appears in the agreement and replaced in each instance with the term “AMM
Subordinated Lender”;

(h)           the
defined term “Apex Metals Subordinated Note” shall be deleted each time it
appears in the agreement and replaced in each instance with the term “AMM
Subordinated Note”;

(i)            the
defined term “Apex Metals Subordination Agreement” shall be deleted each time
it appears in the agreement and replaced in each instance with the term “AMM
Subordination Agreement;

(j)            the
defined term “CGSA Secured Obligations” shall be amended by deleting clause (b)
thereof;

(k)           the
following additional definition shall be inserted in Section 1.03:

 24
 

 

 

“Comercial Metales Blancos” means Comercial
Metales Blancos AB, a privat aktiebolag
organized under the laws of Sweden;

(l)            the
definition of “Quarterly Hedge Report” in Section 1.03 shall be deleted in its
entirety;

(m)          the
introductory paragraph of Section 4 shall be amended by deleting the term “Apex
Metals Collateral” and inserting in its place the words “AMM Collateral”;

(n)           Section
4.01 shall be deleted in its entirety;

(o)           the
Senior Lenders and the Hedge Banks consent to the removal of the Service
Company from the security package, the termination of the security interests in
the Service Company Shares provided for in Section 4.03 and to the deletion of
Section 4.03 in its entirety;

(p)           the Senior Lenders
and the Hedge Banks consent to the liquidation of Apex Metals pursuant to
Section 5.01;

(q)           Section
5.03 shall be amended in its entirety to read as follows:

“Section 5.03 
Business. The Guarantor shall not conduct any business other than
its activities and obligations pursuant and related to the Borrower Concentrate
Sales Agreement, the Spot Sales Agreements and the Third Party Concentrate
Sales Agreements.”;

(r)            Section
5.04 shall be deleted in its entirety.

(s)           Section
5.05 shall be amended shall be amended by (i) deleting all references to the
terms “Mandatory Metals Hedge Transactions” and “Mandatory Metals Hedge
Agreements” in such section, (ii) replacing clause (b)(iii) in its entirety
with the following: “(iii) waive any default under, or breach of, any of the
Subject Documents” and (iii)  deleting
clause (d) of such Section in its entirety;

(t)            Section
5.06(a)(ii) shall be deleted in its entirety;

(u)           Section
5.08(b) shall be amended by (i) deleting the parenthetical that reads “(other
than the Service Company)” and (ii) deleting the last sentence of the section
in its entirety;

(v)           Section
5.13 shall be amended by deleting the words “executed and delivered in
connection with the Closing Date”;

(w)          Section
5.14 shall be amended by inserting after the words “Apex Luxembourg” in the
fourth line thereof the words “or Comercial Metales Blancos or any other Person
permitted under the Transfer Restrictions Agreement”;

 25
 

 

 

(x)            Sections
5.15, 5.18 and 7.01(c)(i)(A) shall be amended by deleting the term “Apex Metals
Account” and inserting in its place the term “AMM Account”;

(y)           Section
7.01(a)(i) shall be deleted in its entirety;

(z)            Section
8.04(i) shall be amended in its entirety to read as follows;

(i)            If
to the Guarantor, to it at:

Apex Metals Marketing GmbH

c/o Juris Treuhand AG

Industriestrasse AG

CH-6304, Zug 

Switzerland

Tel:         (303)
839-5060

(888)
696-2739

Fax:         (303)
839-5097

with a copy to:

Apex Silver Mines Corporation

1700 Lincoln Street, Suite 3050

Denver, CO 80203

Tel:         (303)
839-5060

(888)
696-2739

Fax:         (303)
839-5097

(aa)         Annex
I shall be amended by (i) inserting in (1) after the words “APEX METALS” the
word “MARKETING”; (ii) deleting the information set forth in (4) and inserting
the following in its place:  “CH-170.4.006.587-8
(Registry Number for the Commercial Register of the Canton of Zug”; (iii)
inserting in (5) after the words “APEX METALS” the word “MARKETING” and (iv)
deleting the paragraph set forth under the heading “CHANGE IN CIRCUMSTANCES”
and the heading itself; and

(bb)         Appendix
B thereto shall be deleted in its entirety.

Section 3.05.          Hedge Guaranty. The provisions of the Hedge Guaranty shall
be amended as follows:

(a)           Recital
(A) shall be amended by deleting the text in its entirety and inserting in its
place the words “Apex Silver Finance Ltd., an exempted company with limited
liability organized under the laws of the Cayman Islands (“Apex Silver
Finance”) and the Hedge Banks have executed and will continue to execute
certain Mandatory Metals Hedge Transactions under the Mandatory Metals Hedge
Agreements to which Apex Silver Finance and the Hedge Banks are parties; and”;

 26
 

 

 

(b)           each
other reference to “Apex Metals” in the Hedge Guaranty shall be replaced with
the words “Apex Silver Finance”; and

(c)           each
reference to the term “Apex Metals Document” in the Hedge Guaranty shall be
replaced with the words “Apex Silver Finance Document”.

Section 3.06.          Completion Agreement. The provisions of the Completion Agreement
shall be amended as follows:

(a)           the
defined term “Apex Metals” shall be deleted each time it appears in recital “B”,
recital “C” and Section 3.01(a) of the Completion Agreement and replaced in
each instance with the term “Apex Silver Finance”;

(b)           Section
(d) of Appendix B shall be amended by deleting the term “Apex Metals” in the
third line thereof and inserting in its place the term “Apex Silver Finance”;

(c)           the
definition of “Guaranteed Obligor” in Appendix A thereto shall be amended by
deleting the term “Apex Metals” and inserting in its place the term “Apex
Silver Finance”;

(d)           Appendix
B-4 (Form of Marketing Certificate) shall be amended by deleting the term “Apex
Metals” in clause (b) and inserting in its place the term “Apex Silver Finance”.

Section 3.07.          Project Document
Guarantee (a). The Project Document
Guarantee described in clause (a) of the definition of “Project Document
Guarantee” in Appendix A to the Common Security Agreement (which guarantee is
issued by the Sponsor in favor of the Borrower in respect of Apex Metals’
obligations under the Borrower Concentrate Sales Agreement) shall be amended as
follows:

(a)           Recital
“B” thereto shall be amended in its entirety to read as follows: “Apex Metals
Marketing GmbH (“Apex Metals Marketing”), a
subsidiary of the Guarantor, has entered into the Borrower Concentrate Sales
Agreement with the Borrower;”;

(b)           the
defined term “Apex Metals” shall be deleted each time it appears in the
guarantee and replaced in each instance with the term “Apex Metals Marketing”;
and

(c)           the
second paragraph of Section 2.01 shall be amended by replacing the term “Apex
Metals Account” with the term “AMM Account”.

 27
 

 

 

Section 3.08.          Project Document
Guarantee (b). The Project Document
Guarantee described in clause (b) of the definition of “Project Document
Guarantee” in Appendix A to the Common Security Agreement (which guarantee is
issued by the Sponsor in favor of the Borrower and Apex Metals in respect of
the Service Company’s obligations under the Borrower Management and Services
Agreement and the Apex Metals Management and Services Agreement) shall be
amended as follows:

(a)           Apex
Metals shall be removed as a party to this Project Document Guarantee;

(b)           Apex
Metals Marketing shall be added as a party to this Project Document Guarantee,
with appropriate conforming changes to the introductory paragraph thereof;

(c)           Apex
Silver Finance shall be added to a party to this Project Document Guarantee
with appropriate conforming changes to the introductory paragraph thereof;

(d)           each
reference to the term “Apex Metals” in this Project Document Guarantee shall be
deleted and in each case shall be replaced with the term “Apex Metals Marketing”;

(e)           recital
“E” to this Project Document Guarantee shall be amended by deleting the words “Apex
Metals” in the penultimate line thereof and inserting the words “Apex Silver
Finance” to replace them;

(f)            the
first paragraph of Section 2.01 shall be amended by deleting the words “the
Borrower and Apex Metals” in the second line thereof and inserting the words “the
Borrower, Apex Metals Marketing and Apex Silver Finance” to replace them;

(g)           the
second paragraph of Section 2.01 shall be amended by replacing the term “Apex
Metals Account” with the term “AMM Account”;

(h)           Section
2.02(d) shall be amended by deleting the words “either the Borrower or Apex Metals”
and inserting the words “the Borrower, Apex Metals Marketing or Apex Silver
Finance” to replace them;

(i)            the
last paragraph of Section 2.02 shall be amended by deleting the words “the
Borrower or Apex Metals” in the second line thereof and inserting the words “the
Borrower, Apex Metals Marketing or Apex Silver Finance” to replace them;

(j)            Section
2.03 shall be amended by (i) deleting the words “the Borrower and Apex Metals”
from the sixth line thereof and inserting the words “the Borrower, Apex Metals
Marketing and Apex Silver Finance” to replace them and (ii) deleting the words “the
Borrower or Apex Metals” from the seventh line thereof and inserting the words “the
Borrower, Apex Metals Marketing or Apex Silver Finance” to replace them;

(k)           the
introductory sentence of Article III shall be amended by deleting the words “the
Borrower or Apex Metals” and inserting the words “the Borrower, Apex Metals
Marketing and Apex Silver Finance” to replace them;

 28
 

 

 

(l)            Section
4.01 shall be amended by deleting the words “the Borrower or Apex Metals” from
the second line thereof and inserting the words “the Borrower, Apex Metals
Marketing and Apex Silver Finance” to replace them;

(m)          Section
5.04(b) shall be amended by deleting the words “the Borrower or Apex Metals”
from the sixth line thereof and inserting the words “the Borrower, Apex Metals
Marketing and Apex Silver Finance” to replace them;

(n)           Section
5.07(a) shall be amended by inserting before the words “and the Collateral
Agent” in the second sentence thereof the words “, Apex Silver Finance”;

(o)           Section
5.09 shall be amended by deleting the words “the Borrower or Apex Metals” from
the second line thereof and inserting the words “the Borrower, Apex Metals
Marketing and Apex Silver Finance” to replace them; and

(p)           Section
5.10 shall be amended by (i) deleting the words “the Borrower and Apex Metals”
from the second line thereof and inserting the words “the Borrower, Apex Metals
Marketing and Apex Silver Finance” to replace them and (ii) inserting before
the words “and the Collateral Agent” in the penultimate line thereof the words “,
Apex Silver Finance”.

ARTICLE IV

ACQUISITION AMENDMENTS

Subject
to the satisfaction of each of the conditions precedent specified in Section
5.02 below, but effective as of the Acquisition Effective Date:

Section
4.01.          Consent
to Acquisition. The Secured Parties
consent to the following:

(a)           the transfer by ASM and its Affiliates, and the direct or indirect
acquisition by Sumitomo, of (i) 35% of the outstanding shares of the Borrower,  indirectly, through the acquisition by
Sumitomo of 100% of the shares of SC Minerals Sweden, (ii) 35% of the
outstanding quotas of Apex Metals Marketing (as successor to Apex Metals’
rights and obligations with respect to the Concentrate Sales Agreements under
the Transaction Documents), indirectly, through the acquisition by Sumitomo of
100% of the shares of Comercial Metales Blancos, and (iii) 35% of the
outstanding shares of Apex Silver Finance (as successor to Apex Metal’s rights
and obligations with respect to the Mandatory Metals Hedge Agreements under the
Transaction Documents), directly;

(b)           notwithstanding any contrary provision of the Financing Documents
(including Sections 3.06(b) and 8.02 of the Common Security Agreement), each of
the Borrower, Apex Metals Marketing and Apex Silver Finance shall be permitted
to amend

 29
 

 

or modify its Organizational
Documents as contemplated by the applicable Shareholder Agreement as in effect
on the Acquisition Effective Date;

(c)           notwithstanding any contrary provision of the Financing Documents, Apex
Sweden shall be permitted to repay the Shareholder Note payable to ASM in the
principal amount of $95 million promptly following the Acquisition Effective
Date, provided  that in no event shall the amount of such Shareholder
Note repaid pursuant to this clause (c) exceed the amount Apex Sweden actually
receives in cash from the sale of each of the outstanding SC Minerals Sweden
Shares and the Comercial Metales Blancos Shares;

(d)           notwithstanding any contrary provision of the Financing Documents, the
Borrower shall be permitted to repay Subordinated Debt payable to Apex Silver
Finance from time to time provided that Apex Silver Finance shall use such
repayments to satisfy obligations pursuant to the Mandatory Metals Hedge
Transactions;

(e)           notwithstanding any contrary provision of the Financing Documents, Apex
Luxembourg shall be permitted to (i) repay up to $121 million of the
Shareholder Parent Notes payable to ASM promptly following the Acquisition
Effective Date, provided  that in no event shall the amount of
such Shareholder Parent Note repaid pursuant to this clause (e)(i) exceed the
amount of the dividend Apex Luxembourg actually receives in cash pursuant to
Section 4.01(f)(i), and (ii) transfer to ASM all of its rights (including the
right to receive any and all payments) and obligations under the Deferred
Payments Agreement in exchange for the reduction of the Shareholder Parent Note
Payable to ASM in an amount up to $125 million;

(f)            notwithstanding any contrary provision of the
Financing Documents, Apex Sweden shall be permitted to (i) make a dividend to
Apex Luxembourg in an amount up to $121 million promptly following the
Acquisition Effective Date, provided  that in no event shall the
amount of such dividend under this clause (i) exceed the difference of (A) the
amount Apex Sweden actually receives in cash from the sale of each of the
outstanding SC Minerals Sweden Shares and the Comercial Metales Blancos Shares
less (B) the principal amount of the Shareholder Note repaid pursuant to
Section 4.01(c) and (ii) transfer as a dividend to Apex Luxembourg all of its
rights (including the right to receive any and all payments) and obligations
under the Deferred Payments Agreement; and

(g)           notwithstanding any contrary provision of the Financing Documents,
Sumitomo and SC Minerals Sweden shall be permitted to amend the Organizational
Documents of SC Minerals Sweden after the Acquisition Effective Date solely for
the purpose of changing the legal name of SC Minerals Sweden.

Section 4.02.          Consent to
Disbursement of Contingent Support Account. The Secured Parties consent to the distribution of all amounts on
deposit in the Contingent Support Account to MSC and to the simultaneous
repayment by MSC of Subordinated Debt payable to

 30
 

 

ASM
in an aggregate amount equal to the amount distributed from the Contingent
Support Account.

Section 4.03.          Common Security
Agreement. The provisions of the
Common Security Agreement shall be amended as follows:

(a)           Section
2.07(a)(A)(1) shall be amended by inserting after the words “Contingent Support
Account” in the parenthetical therein the words “or otherwise committed to be
paid by a Sponsor under Sections 5.03 or 5.04 of the ASM Completion Agreement
or Section 4.03 of the Sumitomo Completion Agreement, as applicable”;

(b)           Section
2.08(d)(i) shall be amended by inserting after the words “Contingent Support
Account” in the parenthetical therein the words “or otherwise committed to be
paid by a Sponsor under Sections 5.03 or 5.04 of the ASM Completion Agreement
or Section 4.03 of the Sumitomo Completion Agreement, as applicable.”;

(c)           Section
3.12(e) shall be amended by adding the following sentence at the end thereof: “Appendices
A-1 and A-2 to the Transfer Restrictions Agreement shall not be amended without
the consent of Sumitomo.”

(d)           Section
3.15(a)(v) shall be amended by adding the words “or the Sumitomo Transfer
Restrictions Agreement” after the term “Transfer Restrictions Agreement”;

(e)           Section
3.15(a)(vii) shall be amended by adding the words “or the Sumitomo Transfer
Restrictions Agreement” after the second occurrence of the term “Transfer
Restrictions Agreement”;

(f)            Section
4.02(e) shall be amended by replacing the words “Section 5.03 of the Completion
Agreement” at the end thereof with the words “Section 5.03 and 5.04 of the ASM
Completion Agreement and Section 4.03 of the Sumitomo Completion Agreement”;

(g)           Section
7.01(a)(ii) shall be amended by inserting in the fourth sentence thereof, after
the words “Apex Sweden” the words “or SC Minerals Sweden”;

(h)           Section
8.02 shall be amended by adding the words “or the Sumitomo Transfer
Restrictions Agreement” after the term “Transfer Restrictions Agreement”;

(i)            Section
8.18 shall be amended by replacing each reference to “the Sponsor” with the words
“a Sponsor”;

(j)            Section
8.19(a)(ii) shall be amended by inserting after the words “Transfer
Restrictions Agreement” the words “or Sumitomo Transfer Restrictions Agreement”;

(k)           Section
10.01(b) shall be amended in its entirety to read as follows:

“(b)         Breach of Representation
and Warranty.

 31
 

 

 

(i) Any representation, warranty or statement
confirmed or made by the Borrower under Sections 7.01(a) (Organization and
Ownership), 7.01(b) (Authority), 7.01(c)(ii) (Proper Legal Form), 7.01(d)
(Consents and Approvals for Financing Documents), Section 7.01(e) (Consents and
Approvals for Project), 7.01(f) (No Conflicts), 7.01(j) (Title to Properties;
Security Interests), 7.01(k) (Taxes), 7.01(o) (Transaction Documents) or
7.01(q) (Environmental Matters) or contained in any certificate, statement,
notice or other document provided to any Secured Party under or pursuant to any
such sections shall have been incorrect in any material respect when made or
deemed to be made or (except if stated to have been made solely as of an
earlier date) repeated, and such representation or warranty is not cured or
otherwise corrected to the satisfaction of the Administrative Agent within 30
days from the earlier of (A) receipt by the Borrower of written notice from the
Administrative Agent of such breach or (B) the date upon which the Borrower
becomes aware of such breach; or

(ii)
any other representation, warranty or statement confirmed or made by the
Borrower in any Financing Document or contained in any certificate, statement,
notice or other document provided to any Secured Party under or pursuant to any
Financing Document shall have been incorrect in any material respect when made
or deemed to be made or (except if stated to have been made solely as of an
earlier date) repeated;

(l)            Section
10.01(f) shall be amended in its entirety to read as follows:

“(f) Default Under or Termination of the Completion
Agreement.

(i) (A) a Completion Default under any of the
following sections of the ASM Completion Agreement or the Sumitomo Completion
Agreement shall have occurred and be continuing:

(1) Section 6.01(a) (Payment Default) of the ASM
Completion Agreement or Section 5.01(a) (Payment Default) of the Sumitomo
Completion Agreement, unless within 10 Business Days from the receipt of
written notice by the Borrower from the Administrative Agent of such default,
the Borrower (with funds from the Sponsors) or the non-defaulting Sponsor shall
have cured such default;

(2) Section 6.01(b) (Breach of Representation or
Warranty) of the ASM Completion Agreement or Section 5.01(b) (Breach of
Representation or Warranty) of the Sumitomo Completion Agreement, unless within
30 days from the earlier of (x) receipt of written notice from the
Administrative Agent of such breach or (y) the date upon which the non-defaulting
Sponsor becomes aware of such breach, the non-defaulting Sponsor shall have
cured such default; or

 32
 

 

 

(3) Section 6.01(c) (Breach of Covenant) of the ASM
Completion Agreement or Section 5.01(c) (Breach of Covenant) of the Sumitomo
Completion Agreement, with respect to any of the covenants (other than to pay
money) in Sections 5.03 or 5.04 of the ASM Completion Agreement or Section 4.03
of the Sumitomo Completion Agreement, unless within 30 days from the earlier of
(x) receipt of written notice from the Administrative Agent of such breach or
(y) the date upon which the non-defaulting Sponsor becomes aware of such
breach, the non-defaulting Sponsor shall have cured such default; or

(B) any other Completion Default under either the
ASM Completion Agreement or the Sumitomo Completion Agreement shall have
occurred and be continuing; or

(ii) either Completion Agreement shall have
been terminated prior to Completion;

(iii) either Completion Agreement shall have been
declared in a final order of a court to be unenforceable against the applicable
Sponsor; or

(iv) either Sponsor shall have repudiated its
obligations under the applicable Completion Agreement prior to Completion;

provided that
any Completion Default listed in clauses (ii) through (iv) above or any
uncurable Completion Default shall not be an Event of Default if, promptly but
in no case later than five Business Days after receiving such notice from the
Administrative Agent, the non-defaulting Sponsor shall assume all obligations
of the defaulting Sponsor under each Financing Document to which it is a party
(until such time as the defaulting Sponsor shall have been replaced in
accordance with this paragraph) and within 90 days after the Administrative
Agent notifies the Borrower and Sponsors of such occurrence, (I) the
terminated, repudiated or unenforceable Completion Agreement shall have been
replaced with an alternative completion agreement acceptable to the Secured
Parties or (II) the defaulting Sponsor shall have been replaced (x) if the defaulting
Sponsor is Sumitomo, with an alternate sponsor having a credit rating at least
as strong as that held by Sumitomo on and as of June 30, 2006 or (y) if the
defaulting Sponsor is ASM, with (1) an alternate sponsor that is acceptable to
the Majority Secured Parties (such acceptance not to be unreasonably withheld)
and (2) an operator (which, for the avoidance of doubt, may be the alternate
sponsor referred to in the preceding clause (1)) that is acceptable to the
Majority Secured Parties (such acceptance not to be unreasonably withheld) to
operate the Project on terms reasonably acceptable to the Majority Secured
Parties; provided further that if the defaulting
Sponsor is Sumitomo, ASM shall have deposited into the

 33
 

 

 

Contingent Support Account an amount equal to the
difference of $70,000,000 minus the aggregate amount of all Contingent Support
Contributions of ASM and Sumitomo made from and after the Acquisition Effective
Date immediately upon receiving notice of such occurrence from the
Administrative Agent;”;

(m)          Section
10.01(g) shall be amended in its entirety to read as follows:

“(g)         Default Under or
Termination of a Transfer Restrictions Agreement. (i) A TRA Default under either the
Transfer Restrictions Agreement or the Sumitomo Transfer Restrictions Agreement
shall have occurred and be continuing; (ii) either the Transfer
Restrictions Agreement or the Sumitomo Transfer Restrictions Agreement shall be
terminated other than in accordance with its terms; (iii) either the
Transfer Restrictions Agreement or the Sumitomo Transfer Restrictions Agreement
shall have been declared in a final order of a court to be unenforceable
against a party thereto (other than the Administrative Agent or the Collateral
Agent) or any Permitted Assignee of any thereof; or (iv) any party thereto
(other than the Administrative Agent or the Collateral Agent) or any Permitted
Assignee of any thereof shall have repudiated its obligations under the
Transfer Restrictions Agreement or the Sumitomo Transfer Restrictions
Agreement;”;

(n)           Section
10.01(i) shall be amended in its entirety to read as follows:

“(i)          Sponsor Default.

(i) (A)
a Sponsor Default under any of the following sections of the Sponsor Pledge
Agreement or the Sumitomo Pledge and Guarantee Agreement shall have occurred and
be continuing:

(1)
Section 6.01(a) (Payment Default), unless within 10 Business Days from the
receipt of written notice from the Administrative Agent of such default, the
non-defaulting Sponsor shall have cured such default; or

(2) Section 6.01(b) (Breach of Representation and
Warranty), unless within 30 days from the earlier of (x) receipt of written
notice from the Administrative Agent of such breach or (y) the date upon which
the non-defaulting Sponsor becomes aware of such breach, the non-defaulting Sponsor
shall have cured such default; or

(3) Section 6.01(c)(ii) (Breach of Covenant), unless
within 30 days from the earlier of (x) receipt of written notice from the
Administrative Agent of such breach or (y) the date upon which the
non-defaulting Sponsor becomes aware of such breach, the non-defaulting Sponsor
shall have cured such default; or

 34
 

 

 

(B)
any other Sponsor Default under the Sponsor Pledge Agreement or the Sumitomo
Pledge and Guarantee Agreement shall have occurred and be continuing; or

(ii) the
Sponsor Pledge Agreement or the Sumitomo Sponsor Pledge and
Guarantee Agreement shall be terminated;

(iii) the
Sponsor Pledge Agreement or the Sumitomo Sponsor Pledge and
Guarantee Agreement shall have been declared in a final order of a court
to be unenforceable against the applicable Sponsor; or

(iv) either
Sponsor shall have repudiated its obligations under the applicable Sponsor
Pledge Agreement;

provided that
any Sponsor Default listed in clauses (ii) through (iv) above or any uncurable
Sponsor Default shall not be an Event of Default if, promptly but in no case
later than five Business Days after receiving such notice from the
Administrative Agent, within the non-defaulting Sponsor shall assume all
obligations of the defaulting Sponsor under each Financing Document to which it
is a party (until such time as the defaulting Sponsor shall have been replaced
in accordance with this paragraph) and within 90 days after the Administrative
Agent notifies the Borrower and Sponsors of such occurrence, (I) the terminated,
repudiated or unenforceable agreement shall have been replaced with an
alternative sponsor pledge agreement acceptable to the Secured Parties or (II)
the defaulting Sponsor shall have been replaced (x) if the defaulting Sponsor
is Sumitomo, with an alternate sponsor having a credit rating at least as
strong as that held by Sumitomo on and as of June 30, 2006 or (y) if the
defaulting Sponsor is ASM, with (1) an alternate sponsor that is acceptable to
the Majority Secured Parties (such acceptance not to be unreasonably withheld)
and (2) an operator (which, for the avoidance of doubt, may be the alternate
sponsor referred to in the preceding clause (1)) that is acceptable to the
Majority Secured Parties (such acceptance not to be unreasonably withheld) to
operate the Project on terms reasonably acceptable to the Majority Secured
Parties; provided further that if the defaulting
Sponsor is Sumitomo, ASM shall have deposited into the Contingent Support
Account an amount equal to the difference of $70,000,000 minus the aggregate
amount of all Contingent Support Contributions of ASM and Sumitomo made from
and after the Acquisition Effective Date immediately upon receiving notice of
such occurrence from the Administrative Agent;”;

(o)           Section
10.01(u) shall be amended by deleting the word “Sponsor” in clause (ii) thereof
and replacing it with the word “Sponsors”;

(p)           Section
10.01(aa) shall be amended in its entirety to read as follows:

 35
 

 

 

“(aa)       Forced Divestiture.
A law, order, decree, regulation, directive or restriction is issued by any
Governmental Authority of the principal place of business of either Sponsor,
any Senior Lender or any of Apex Luxembourg, Apex Sweden or SC Minerals Sweden
that (i) requires any of SC Minerals Sweden, Apex Luxembourg or Apex Sweden to
divest itself of all or part of its equity interest in the Borrower or (ii)
prevents either Sponsor or any of Apex Luxembourg, Apex Sweden or SC Minerals
Sweden from participating in all or any part of the benefit of its equity
interests in the Project, and in each such case such law, order, decree,
regulation, directive or restriction remains in effect for a period of 180
days; provided however that any such
occurrence shall not be an Event of Default if, within 10 Business Days after
such 180-day period (or such divestiture if earlier), the unaffected Sponsor or
an Affiliate of the unaffected Sponsor acquires all rights and interests of the
affected entity in the Borrower and Project pursuant to an assignment agreement
acceptable to the Majority Secured Parties, so long as such acquisition would
avoid the effect of the relevant law, order, decree, regulation, directive or
restriction;”

(q)           Section
10.01(ee) shall be amended in its entirety to read as follows:

“(ee)       Change in Control. Subject to the provisions of the Transfer
Restrictions Agreements:

(i)            Prior to
Completion (A) ASM shall cease to own directly 100% of the issued and
outstanding Apex Luxembourg Shares or (B) ASM shall cease to Control the
Borrower, Apex Metals Marketing or Apex Silver Finance directly or indirectly;

(ii)           prior to
Completion, (A) Apex Luxembourg shall cease to own directly 100% of the issued
and outstanding Apex Sweden Shares, or at least 65% of the Apex Silver Finance
Shares, or at least one share in the Borrower or (B) Apex Luxembourg shall
cease to Control Apex Sweden or Apex Silver Finance directly or indirectly;

(iii)          prior to
Completion, (A) Apex Sweden and
SC Minerals Sweden shall collectively cease to own, directly, 100% of the
issued and outstanding Borrower Shares (less one share held by Apex
Luxembourg), or (B)  Apex Sweden and Comercial Metales Blancos shall
collectively cease to own, directly, 100% of the issued and outstanding Apex
Metals Marketing Quotas, or
(C) Apex Sweden shall cease to Control the Borrower or Apex Metals
Marketing directly or indirectly; or

(iv)          at
any time after Completion, ASM shall cease to Control the Borrower, Apex Metals
Marketing or Apex Silver Finance directly or indirectly;

 36
 

 

 

provided that,
the failure of ASM to comply with the conditions described in clauses (i) and
(iv) above shall not constitute Events of Default if concurrently therewith ASM
is replaced with (1) an alternate sponsor that is acceptable to the Majority
Secured Parties (such acceptance not to be unreasonably withheld) and (2) an
operator (which, for the avoidance of doubt, may be the alternate sponsor
referred to in the preceding clause (1)) that is acceptable to the Majority
Secured Parties (such acceptance not to be unreasonably withheld) to operate
the Project on terms reasonably acceptable to the Majority Secured Parties; or

(v)           prior
to Completion, (A) Sumitomo shall cease to own 100% of the outstanding shares
of either SC Minerals Sweden or Comercial Metales Blancos, (B) SC Minerals
Sweden shall cease to own directly 35% of the issued and outstanding Borrower
Shares, or (C) Comercial Metales Blancos shall cease to own directly 35% of the
issued and outstanding Apex Metals Marketing Quotas (except, in cases (B) and
(C) above, for any such Shares or Quotas transferred to ASM or its Affiliates).”

(r)            Section
10.02(d) shall be amended by deleting the words “the Sponsor” each time they
appear in the section and inserting in their place the word “ASM”;

(s)           Section
11.04(g)(i) and (ii) shall be amended to read as follows:

“(i)          (A) a
percentage of the identified Planned Project Costs equal to the quotient
(expressed as a percentage) of (1) the aggregate amount of undrawn Senior Loan
Commitments divided by (2) the total amount of Planned Project Costs set forth
on the most recently accepted Cost to Complete Certificate (not including the
$4 million of Planned Project Costs paid by ASM with ordinary shares pursuant
to the EPCM Contract), shall be funded by Senior Loans, and (B) the remaining
identified Planned Project Costs shall be funded by Base Equity Contributions; provided that at no time shall the TPCFR exceed 33:67; and

(ii)           Excess Project Costs shall be funded: (A) from amounts otherwise
available in the AMM Account (and not previously marked for any other purpose) and
(B) by Contingent Support Contributions from the Sponsors deposited into the
Contingent Support Account on or before the requested Disbursement Date”;

(t)            Section
14.10 shall be amended by inserting after the words “Apex Group” in the last
line thereof the words “or the Sumitomo Group”;

(u)           Section
15.08 shall be amended by (i) deleting clauses (vi) and (vii) thereof and (ii)
inserting the following clauses:

(vi)          If to SC Minerals Sweden, to it at :

 37
 

 

 

Gotlex Lageraktiebolag nr. 451, organizational number 556702-1083

c/o Wistrand Advokatbyra

Lilla Bommen 1

S-411 04 Göteborg

Sweden

Tel:  +81-3-5166-4300

Fax:  +81-3-5166-6423

Attn: Director

with a copy to:

Sumitomo Corporation

8-11, Harumi, 1-chome,

Chuo-ku, Tokyo, 104-8610 Japan

Attention: General Manager, Non-Ferrous Metals &

Raw Materials Department

Telecopier: +81-3-5166-6423

(vii)         If to Comercial Metales Blancos, to it at:

Comercial Metales Blancos AB

c/o Anders Skoldberg, Ernst & Young AB

401 82 Göteborg

Sweden

Tel:  +81-3-5166-4300

Fax:  +81-3-5166-6423

Attn: Director

with a copy to:

Sumitomo Corporation

8-11, Harumi, 1-chome,

Chuo-ku, Tokyo, 104-8610 Japan

Attention: General Manager, Non-Ferrous Metals &

Raw Materials Department

Telecopier: +81-3-5166-6423

(v)           the
definition of “Affiliated Obligors” in Appendix
A thereto shall be further amended by (i) replacing the words “the Sponsor”
with “ASM” and (ii) inserting after the term “Apex Sweden” the word “, Sumitomo”;

(w)          the
definition of “Completion” in
Appendix A thereto shall be amended by inserting before the words “Completion
Agreement” the word “ASM”;

 38
 

 

 

(x)            the
definition of “Completion Agreement” in Appendix
A thereto shall be amended in its entirety to read “means either of the ASM
Completion Agreement or the Sumitomo Completion Agreement.”;

(y)           the
definition of “Completion Certificates”
in Appendix A thereto shall be amended by inserting before the words “Completion
Agreement” the word “ASM”;

(z)            the
definition of “Completion Default” in Appendix A
thereto shall be amended in its entirety to read “means a “Completion Default”
as such term is defined in either of the ASM Completion Agreement or the
Sumitomo Completion Agreement.”;

(aa)         the
definition of “Completion Test”
in Appendix A thereto shall be amended by inserting before the words “Completion
Agreement” the word “ASM”; ;

(bb)         the
definition of “Completion Test Period”
in Appendix A thereto shall be amended by inserting before the words “Completion
Agreement” the word “ASM”;

(cc)         the
definition of “Contingent Support Contribution”
in Appendix A thereto shall be amended in its entirety to read “means one or
more deposits by either ASM or Sumitomo into the Contingent Support Account for
transfer to the Loan Proceeds Account for the purpose of paying Excess Project
Costs in accordance with Section 11.04(g)(ii).”;

(dd)         the
definition of “Contingent Support
Requirement” in Appendix A thereto shall be amended in its entirety
to read “means, at any date of determination, (i) the Total Cost to Complete as
indicated on the most recently approved Cost to Complete Certificate less (ii) the sum of (A) the total amount
of Senior Loan Commitments then available to be drawn plus (B) the sum of (1) amounts available
to be drawn under Equity Support Letters of Credit plus (2) the balance of the Equity Account”;

(ee)         the
definition of “Financing Documents” in Appendix
A thereto shall be further amended by inserting after the words “Fee Letters”
the words “, each of the Sumitomo Documents”;

(ff)           the
definition of “Information” shall be amended by
inserting the words “or the Sumitomo Group” after each occurrence of the term “Apex
Group”;

(gg)         the
definition of “Project Document Guarantees” in
Appendix A thereto shall be amended by deleting in clause (a) the words “the
Sponsor” and inserting in their place the word “ASM”;

(hh)         the
definition of “Restricted Payment” in Appendix A
thereto shall be amended by (i) deleting the word “and” at the end of clause
(a) thereof, (ii) deleting the period at the end of clause (b) thereof and
inserting in its place the word “, and” and (iii) inserting the following
clause at the end of such definition: “(c) all payments of the Service Fee in
excess of $125,000 per month.”;

 39
 

 

 

(ii)           the
definition of “Sponsor” in Appendix A thereto
shall be amended in its entirety to read “means either ASM or Sumitomo, and “Sponsors” means both ASM and Sumitomo.”;

(jj)           the
definition of “Sponsor Default” in Appendix A
thereto shall be amended in its entirety to read “means a “Sponsor Default” as
such term is defined in either of the Sponsor Pledge Agreement or the Sumitomo
Pledge and Guarantee Agreement.”;

(kk)         the
definition of “Sponsor Funding”
in Appendix A thereto shall be amended in its entirety to read “means funding
provided to the Borrower by or on behalf of either Sponsor, Apex Luxembourg,
Apex Sweden or SC Minerals Sweden”;

(ll)           the
definition of “Sponsor Pledge Agreement”
in Appendix A thereto shall be further amended by deleting the words “the
Sponsor” and inserting the word “ASM” to replace them;

(mm)       the
definition of “TRA Default” in Appendix A
thereto shall be amended in its entirety to read “has the meaning specified in
Section 4.01 of either the Transfer Restrictions Agreement or the Sumitomo
Transfer Restrictions Agreement.”;

(nn)         the
following additional defined terms shall be inserted in Appendix A thereto:

“Apex Metals Marketing
Quotaholders Agreement” means the Metals Quotaholders Agreement to
be entered into on or about September 26, 2006, among Apex Sweden, Comercial
Metales Blancos and Apex Metals Marketing.

“Apex Silver Finance Shareholders
Agreement” means the Apex Silver Finance Shareholders Agreement to
be entered into on or about September 26, 2006, among Apex Luxembourg, Sumitomo
and Apex Silver Finance.

“ASM Completion Agreement”
means the Completion Agreement dated December 1, 2005, among ASM, the Technical
Agent, the Administrative Agent and the Collateral Agent.

“Borrower Shareholders Agreement” means the MSC Shareholders Agreement
to be entered into on or about September 26, 2006, among Apex Luxembourg, Apex
Sweden, SC Minerals Sweden and the Borrower.

“Deferred Payments
Agreement” means the Deferred Payments Agreement to be entered into
on or about September 26, 2006, between Apex Sweden and Sumitomo.

 40
 

 

 

“Shareholders Agreements”
means the Borrower Shareholders Agreement, the Apex Metals Marketing
Quotaholders Agreement and the Apex Silver Finance Shareholders Agreement.

“Sumitomo Completion
Agreement” means the Sumitomo Completion Agreement executed and
delivered in satisfaction of Section 5.02(c) of the Omnibus Amendment Agreement,
among Sumitomo, the Technical Agent, the Administrative Agent and the
Collateral Agent.

“Sumitomo Documents”
means the Sumitomo Completion Agreement, the Sumitomo Pledge and Guarantee
Agreement and the Sumitomo Transfer Restrictions Agreement.

“Sumitomo Group”
means Sumitomo and each of its Subsidiaries (as such term is defined in the
Sumitomo Pledge and Guarantee Agreement).

“Sumitomo Pledge and
Guarantee Agreement” means the Sumitomo Pledge and Guarantee
Agreement executed and delivered in satisfaction of Section 5.02(c) of the
Omnibus Amendment Agreement, between Sumitomo and the Collateral Agent.

“Sumitomo Transfer
Restrictions Agreement” means the Sumitomo Transfer Restrictions
Agreement executed and delivered in satisfaction of Section 5.02(c) of the
Omnibus Amendment Agreement, among Sumitomo, SC Minerals Sweden, Comercial
Metales Blancos, the Administrative Agent and the Collateral Agent.”

Section 4.04.          Transfer Restrictions
Agreement. The provisions of the
Transfer Restrictions Agreement shall be amended as follows:

(a)           recital
“C” shall be amended in its entirety to read as follows:  “C. Apex Luxembourg directly owns 100% of the
outstanding share capital of Apex Sweden, 65% of the outstanding share capital
of Apex Silver Finance and one share in the Borrower”;

(b)           recital
“D” shall be amended in its entirety to read as follows: “D. Apex Sweden
directly owns 64.99% of the outstanding share capital of the Borrower and 65%
of the outstanding share capital of Apex Metals Marketing.”;

(c)           Section
2.01(a) shall be amended by deleting clauses 2.01(a)(iii)(C) and (D) in their
entirety and deleting clause 2.01(a)(iv) in its entirety;

(d)           the
last paragraph of Section 2.01 shall be revised by inserting after the words “the
Sponsor” in the second line thereof the words “and Sumitomo collectively”,

(e)           Section 2.04(a) shall
be amended to insert “ASM” immediately prior to “Completion Agreement” in the
penultimate line;

 41

 

(f)            an
additional Section 2.06 shall be added at the end of Article II, which shall
read as follows:

“2.06  Successor Sponsor. Transfers
otherwise prohibited under Sections 2.01 and 2.02 hereof shall not constitute
TRA Defaults hereunder if such transfers are made to an alternate sponsor in
connection with the cure of a Sponsor Default or Completion Default of ASM, so
long as ASM is replaced with (a) an alternate sponsor that is acceptable to the
Majority Secured Parties (such acceptance not to be unreasonably withheld) and
(b) an operator (which, for the avoidance of doubt, may be the alternate
sponsor referred to in the preceding clause (a)) that is acceptable to the
Majority Secured Parties (such acceptance not to be unreasonably withheld) to
operate the Project on terms reasonably acceptable to the Majority Secured
Parties.”;

(g)           Section 3.01(a) shall be amended to insert “ASM” immediately prior to “Completion
Agreement” in the penultimate line; and

(h)           Section 4.01(a) shall be amended to insert the following at the end of
the clause:

“provided that it shall not be a TRA Default under this
Section 4.01(a) if the facts that resulted in an incorrect representation,
warranty or statement are (i) corrected so that the incorrect representation,
warranty or statement becomes correct or (ii) otherwise addressed to the
satisfaction of the Administrative Agent acting on behalf of the Secured
Parties, in each case within 30 days from the earlier of (x) receipt of written
notice from the Administrative Agent notifying such Shareholder Party of the
incorrect representation, warranty or statement or (y) the date on which any
Shareholder Party becomes aware of such incorrect representation, warranty or
statement”.

Section
4.05.          Sponsor
Pledge Agreement. The provisions of
the Sponsor Pledge Agreement shall be amended as follows:

(a)           recital
“C” of the Sponsor Pledge Agreement shall be further amended by deleting the
words “indirectly owns 100%” in the third line thereof and inserting in their
place the words “directly and indirectly owns 65%”;

(b)           Section
4.05(a) of the Sponsor Pledge Agreement shall be amended by adding at the end
of the clause the words “(other than any of the foregoing relating solely to a
member of the Sumitomo Group)”;

(c)           Section 5.04 of the Sponsor Pledge Agreement shall be amended by adding
after the words “realization and” in the third line thereof the words “and, to
the

 42
 

 

 

extent
the Sponsor is liable thereon pursuant to this Agreement or the ASM Completion
Agreement,”;

(d)           Section 6.01(b) of the Sponsor Pledge Agreement shall be amended in its
entirety to read as follows:

 “(b) Breach of Representation
and Warranty.

(i)
any representation, warranty or statement confirmed or made by the Sponsor
under Sections 2.01 (Representations), to the extent that the applicable
representation in the ASM Completion Agreement is identified in Section 6.01(b)
of the ASM Completion Agreement, or under 2.02 (Good Title; Valid Security
Interests), 2.03 (Names, Etc.) or 2.04 (Proper Legal Form) or contained in any
certificate, statement, notice or other document provided by the Sponsors to
any Secured Party under or pursuant to any such sections shall have been
incorrect in any material respect when made or deemed to be made or (except if
stated to have been made solely as of an earlier date) repeated, and such
representation or warranty is not cured or otherwise corrected to the
satisfaction of the Administrative Agent within 30 days from the earlier of (A)
receipt of written notice from the Administrative Agent of such breach or (B)
the date upon which the Sponsor becomes aware of such breach; or

(ii)
any other representation, warranty or statement confirmed or made by the
Sponsor hereunder or contained in any certificate, statement, notice or other
document provided by the Sponsors to any Secured Party hereunder shall have
been incorrect in any material respect when made or deemed to be made or
(except if stated to have been made solely as of an earlier date) repeated;”;

(e)           Section 7.11 of the Sponsor Pledge Agreement shall be amended by (i)
deleting the words “or Event of Default” in the fourth line thereof and (ii)
deleting the words “resulting therefrom” in the fifth line thereof, and
inserting in their place the words “hereof or hereon resulting from any Sponsor
Default or Event of Default”; and

(f)            each reference to the term “Completion
Agreement” in the Sponsor Pledge Agreement shall be amended to read “ASM
Completion Agreement”.

Section
4.06.          Completion
Agreement. The provisions of the
Completion Agreement shall be amended as follows:

(a)           Section 3.01(a) shall be revised in its entirety to read as follows:

“(a)         The Sponsor, as a primary obligor and not merely as a surety,
unconditionally and irrevocably guarantees to the Collateral Agent, the
Administrative Agent, the Technical Agent, each Senior Lender and

 43
 

 

 

each Hedge Bank and their
respective successors and assigns the full and punctual payment of its Pro Rata
Share of (i) all Secured Debt Obligations and (ii)  all Apex Silver
Finance Obligations that, in any such case, are or become due and payable prior
to Completion, when and as the same shall become due and payable, whether at
maturity, upon acceleration, early termination or otherwise (subject to any
exclusions or applicable grace periods), according to their terms (such
obligations being herein collectively called the “Guaranteed
Obligations”). In case of the failure of any Guaranteed Obligor to
so pay any Guaranteed Obligation, the Sponsor agrees to make payment of its Pro
Rata Share thereof forthwith upon demand, in Dollars, in cash, at such times
and in the same manner as required of such Guaranteed Obligor.”

(b)           the following new Section 3.04 shall be added to Article III of the
Completion Agreement:

“3.04  Several Obligations.
The obligations of ASM under its Completion Guarantee and the obligations of
Sumitomo under the Sumitomo Completion Agreement are several, and not joint or
joint and several. The obligations of ASM under its Completion Guarantee and
Article V shall be limited to its Pro Rata Share of the Guaranteed Obligations
or required Contingent Support Contributions. Neither a Completion Default nor
the failure of ASM or Sumitomo to meet any of its other obligations under a
Completion Agreement or under a Transfer Restriction Agreement, and no transfer
of Interests in the Borrower or any other Person, shall change ASM’s Pro Rata
Share.”;

(c)           each of Sections 4.01(m) and 4.01(n) shall be deleted in its entirety;

(d)           Section 5.01 shall be amended by inserting as the final sentence the
following: “The Sponsor’s liability for any financial obligations implied in or
arising from such efforts shall be limited to the Sponsor’s Pro Rata Share
thereof.”;

(e)           a new Section 5.03 shall be inserted in Article V, which shall read as
follows:

“5.03
Contingent Support Contribution Commitment.
The Sponsor agrees to deposit into the Contingent Support Account for transfer
to the Loan Proceeds Account, when and as required to meet Excess Project Costs
payable by the Borrower, its Pro Rata Share of up to an aggregate amount of
$70,000,000 in Contingent Support Contributions from and after the Acquisition
Effective Date for the purpose of paying Excess Project Costs in accordance
with Section 11.04(g)(ii) of the Common Security Agreement.”;

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(f)            the former Section 5.03 shall be renumbered
and amended in its entirety to read as follows:

“5.04
Contingent Support Deficiencies. Without
limiting Section 5.03, in the event that at any time a Contingent Support
Deficiency exists as identified in a Cost to Complete Certificate that is not
funded under Section 5.03 above or Section 4.03 of the Sumitomo Completion
Agreement, the Sponsor shall either (a) demonstrate to the satisfaction of the
Administrative Agent that the Sponsor holds Available Cash in an amount
sufficient to fund its Pro Rata Share of such Contingent Support Deficiency or
(b) propose to the Administrative Agent an Acceptable Funding Plan for funding
its Pro Rata Share of such Contingent Support Deficiency within ten (10) days
of the date of such Cost to Complete Certificate. The Administrative Agent
shall notify the Sponsor of its receipt of the Acceptable Funding Plan. In the
event that the Administrative Agent (acting at the direction of the Majority
Secured Parties) accepts such Acceptable Funding Plan, the Sponsor shall
diligently pursue such plan and shall have ninety (90) days from the date on
which the Administrative Agent has notified the Sponsor of the acceptance of
such Acceptable Funding Plan to deposit, in immediately available funds, its
Pro Rata Share of the Contingent Support Deficiency to be funded in connection
with such Acceptable Funding Plan. In the event that the Administrative Agent
(acting at the direction of the Majority Secured Parties) rejects such
Acceptable Funding Plan or in the event that the Sponsor is required and has
failed to propose an Acceptable Funding Plan within ten (10) days of the date
of the Cost to Complete Certificate identifying the Contingent Support
Deficiency that is not funded under Section 5.03 above or Section 4.03 of the
Sumitomo Completion Agreement, the Sponsor shall immediately and without
demand, notice or presentment of any kind or nature whatsoever, deposit in the
Contingent Support Account, in immediately available funds, an amount equal to
its Pro Rata Share of the Contingent Support Deficiency on the date of the
rejection of its plan or, where it has not presented a plan, the date on which
such plan was due to be presented. The Sponsor shall submit additional
Acceptable Funding Plans in the event that additional funds are required to
cause the Contingent Support Requirement to be satisfied without regard as to
whether the Sponsor may be currently implementing an Acceptable Funding Plan
with respect to a previously identified Contingent Support Deficiency.”;

(g)           each of the former Sections 5.04 and 5.05 shall be deleted in its
entirety;

(h)           Section 6.01(b) shall be amended in its entirety to read as follows:

“(b)         Breach of Representation or
Warranty Under this Agreement.
(i) a representation, warranty or statement confirmed or made

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by the Sponsor under Sections 4.01(a)
(Organization), 4.01(b) (Ownership of the Borrower), 4.01(c) (Authority),
4.01(e) (Consents and Approvals), 4.01(f) (No Conflicts), or 4.01(j) (Taxes) or
contained in any written certificate, notice or other document provided to any
Secured Party under or pursuant to such sections shall have been incorrect in
any material respect when made or deemed to be made or repeated (except if
stated to have been made solely as of an earlier date), and such representation
or warranty is not cured or otherwise corrected to the satisfaction of the
Administrative Agent within 30 days from the earlier of (A) receipt of written
notice from the Administrative Agent of such breach or (B) the date upon which
the Sponsor becomes aware of such breach; or (ii) any other representation,
warranty or statement confirmed or made by the Sponsor hereunder contained in
any certificate, notice or other document provided to any Secured Party
hereunder or pursuant to any Financing Document to which it is a party shall
have been incorrect in any material respect when made or deemed to be made or
(except if stated to have been made solely as of an earlier date) repeated; or”;

(i)            Section 6.01(c)(i) shall be deleted;

(j)            the definitions of each of “Additional Escrow Account”, 
“Convertible Notes”, “Dedicated Cash”, “Escrow Account”
and “Sponsor Budget” shall be deleted in its
entirety;

(k)           the following additional definitions shall be added to Appendix A
thereto:

 “Acquisition Effective Date”
has the meaning assigned to such term in the Omnibus Amendment Agreement.

“MSC Shareholders Agreement” means the MSC Shareholders
Agreement to be entered into on or about September 26, 2006, among Apex Sweden,
Apex Luxembourg, SC Minerals Sweden and the Borrower.

“Pro Rata
Share” shall mean 65%.

Section
4.07.          Project
Document Guarantee (a). The Project
Document Guarantee described in clause (a) of the definition of “Project
Document Guarantee” in Appendix A to the Common Security Agreement (which
guarantee is issued by ASM in favor of the Borrower in respect of Apex Metals
Marketing’s obligations under the Borrower Concentrate Sales Agreement) shall
be amended as follows:

(a)           Section 1.02 shall include the following
additional definition: “Pro Rata Share”
means (a) prior to Completion, 65% and (b) after Completion, 100% minus (i) the
“Pro Rata Share” of Sumitomo at such time under the Sumitomo Pledge and
Guarantee Agreement and (ii) the percentage of the total number of shares of
the Borrower issued and outstanding then owned directly or indirectly by a
third party acceptable to the

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Secured Parties that has assumed such percentage share of the
obligations guaranteed under this agreement and the Sumitomo Pledge and
Guarantee Agreement.”

(b)           the first paragraph of Section 2.01 shall be
amended in its entirety to read as follows:

“2.01  The Guarantee. The
Guarantor hereby unconditionally guarantees to the Borrower and its respective
successors and assigns (for the benefit of the Secured Parties) the full, prompt
and proper payment of its Pro Rata Share of all payment obligations of Apex
Metals Marketing to the Borrower under the Borrower Concentrate Sales Agreement
and the observance, compliance and performance by Apex Metals Marketing of all
of the other terms, covenants, obligations and conditions that are to be
performed by Apex Metals Marketing under the Borrower Concentrate Sales
Agreement, and agrees that upon any breach by Apex Metals Marketing of any
terms, covenants, obligations and conditions of the Borrower Concentrate Sales
Agreement, the Guarantor will, subject to Section 2.06 below, forthwith
perform, or cause to be performed to the extent of its Pro Rata Share thereof,
each of said terms, covenants, obligations and conditions (including its Pro Rata
Share of payment obligations) (such obligations being herein collectively
called the “Concentrate Sales Guaranteed Obligations”).
This is a present and continuing guarantee of performance and, to the extent
that this instrument guarantees payment by Apex Metals Marketing, this is a
guarantee of payment and not of collection.”

(e)           the following additional Section 2.06 shall be inserted at the end of
Article II:

“2.06  Several Obligation. The obligations of ASM hereunder and the
obligations of Sumitomo under its guarantee of Apex Metals Marketing’s
obligations under the Borrower Concentrate Sales Agreement are several, and not
joint or joint and several.”

Section 4.08.          Consent to Increase
in Service Fee. The Secured Parties
consent to the amendment of the Borrower Management and Services Agreement to
increase in the management fee payable by the Borrower to the Service Company
under such agreement from $125,000 per month to $450,000 per month, provided that the Borrower shall not pay the Service Company
any amount above $125,000 for any given month unless each of the conditions
specified in Section 9.01(a) of the Common Security Agreement have been
satisfied with respect to the payment of such excess.

Section 4.09.          AMM Cross-Guarantee
and Security Agreement. The
provisions of the AMM Cross-Guarantee and Security Agreement shall be amended
as follows:

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(a)           Section
5.06(a)(iii) shall be amended by inserting after the words “Transfer
Restrictions Agreement” in the second line thereof the words “or the Sumitomo Transfer
Restrictions Agreement”;

(b)           Section
5.14 shall be further amended by inserting after the words “or any other Person
permitted under the Transfer Restrictions Agreement” the words “or the Sumitomo
Transfer Restrictions Agreement, as applicable”; and

(c)           Section
7.01(b) shall be amended in its entirety to read as follows:

“Any representation, warranty or statement confirmed
or made by the Guarantor under any AMM Document or contained in any
certificate, statement, notice or other document provided to any Secured Party
under or pursuant to any Financing Document to which it is a party shall have
been incorrect in any material respect when made or deemed to be made or
(except if stated to have been made solely as of an earlier date) repeated,
provided that it shall not be a CGSA Default under this Section 7.01(b) if the
facts that resulted in an incorrect representation, warranty or statement are
(i) corrected so that the incorrect representation, warranty or statement
becomes correct or (ii) otherwise addressed to the satisfaction of the
Administrative Agent acting on behalf of the Secured Parties, in each case with
in 30 days from the earlier of (x) receipt of written notice from the
Administrative Agent notifying the Guarantor of the incorrect representation,
warranty or statement or (y) the date on which the Guarantor becomes aware of
such incorrect representation, warranty or statement;”.

ARTICLE V

CONDITIONS PRECEDENT

Section 5.01.          Conditions Precedent
to Reorganization. The provisions
of Article III of this Agreement shall become effective on the date on
which all of the following conditions precedent have been satisfied in form and
substance acceptable to (or shall have been waived by) each Secured Party (the “Reorganization
Effective Date”), provided that such date occurs not later than
December 31, 2006:

(a)           Authorizations. The Administrative Agent and the Collateral
Agent shall have received certified copies of (i) the Organizational
Documents of each of Apex Metals Marketing, Apex Silver Finance, SC Minerals
Sweden and Comercial Metales Blancos and (ii) Authorizations with respect
to ASM, Apex Luxembourg, Apex Sweden, Apex Metals, Apex Metals Marketing, Apex
Silver Finance, SC Minerals Sweden, Comercial Metales Blancos and the Borrower
given to authorize the execution, delivery and performance by it of each
Reorganization Document to which it is a party, and the performance by it of
its obligations hereunder and thereunder, as applicable.

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(b)           Incumbency and Signatures. The Administrative Agent and the Collateral
Agent shall have received certificates of each of Apex Metals Marketing, Apex
Silver Finance, SC Minerals Sweden and Comercial Metales Blancos in respect of
the authority and incumbency, and containing a specimen signature, of each Person
who has signed or will sign each of this Agreement and the other Reorganization
Documents to which it is a party, on its behalf, or who will, until replaced by
another Person or Persons duly authorized for that purpose, otherwise act as
its representative for the purposes of signing documents in connection with
such documents and the transactions contemplated hereby and thereby.

(c)           Pledges.

(i)    Apex
Luxembourg shall have executed and delivered to the Collateral Agent and the
Administrative Agent a pledge agreement under New York law in the form of
Appendix A hereto of all of its right, title and interest in the Apex Silver
Finance Shares as security in favor of the Secured Parties and shall have
delivered such shares to the Collateral Agent;

(ii)   Apex Sweden
shall have executed and delivered to the Collateral Agent and the
Administrative Agent a pledge agreement under New York law in the form of
Appendix B hereto of all of its right, title and interest in the Apex Metals
Marketing Quotas as security in favor of the Secured Parties;

(iii)  Each of Apex
Sweden and Comercial Metales Blancos shall have (A) executed and delivered to
the Collateral Agent and the Administrative Agent a quota pledge under Swiss
law in the form of Appendix C and D hereto respectively of its respective Apex
Metals Marketing quotas as security in favor of the Secured Parties and (B)
made or caused to be made such filings, registrations or recordations and any
other actions as may be necessary to perfect such security interest in Switzerland;

(iv)  Comercial
Metales Blancos shall have executed and delivered to the Collateral Agent and
the Administrative Agent a pledge agreement under New York law in the form of
Appendix E hereto of all of its right, title and interest in the Apex Metals Marketing
Quotas as security in favor of the Secured Parties;

(v)   Apex Sweden
shall have executed and delivered to the Collateral Agent and the
Administrative Agent a pledge agreement under New York law in the form of
Appendix F hereto of all of its right, title and interest in the Comercial
Metales Blancos shares as security in favor of the Secured Parties; and

(vi)  Apex Sweden
shall have executed and delivered to the Collateral Agent and the
Administrative Agent a pledge agreement under New York law in the form of
Appendix G hereto of all of its right, title and interest in the SC Minerals
Sweden shares as security in favor of the Secured Parties.

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(d)           Cross-Guarantee
and Security Agreement. Apex
Silver Finance shall have executed and delivered to the Administrative Agent
and the Collateral Agent a Cross-Guarantee and Security Agreement in the form
of Appendix H hereto.

(e)           Mandatory
Metals Hedge Agreements.

(i)    Apex
Luxembourg shall have executed and delivered to the Collateral Agent and the
Administrative Agent novation agreements in the form of Appendix N-1 and
Appendix N-2 hereto with respect to the transfer of all Mandatory Metals Hedge
Agreements from Apex Metals to Apex Luxembourg;

(ii)   Apex Silver
Finance shall have (A) executed and delivered to the Collateral Agent and the
Administrative Agent amended ISDA Master Agreement schedules in the form of
Appendices O-1 and O-2 hereto, (B) delivered to the Collateral Agent and the
Administrative Agent the confirmations under such agreements, and (C) executed novation
agreements in the form of Appendices P-1 and P-2 hereto with respect to the
transfer of the Mandatory Metals Hedge Agreements from Apex Luxembourg to Apex
Silver Finance;

(f)            Assignment
and Assumption Agreement.
The Collateral Agent and the Administrative Agent shall have received the
Assignment and Assumption Agreement substantially in the form of Appendix I
hereto;

(g)           Notices
of Assignment of Third Party Concentrate Sales Agreements. The Administrative Agent and the Collateral
Agent shall have received evidence of the notice of the transfer of each Third
Party Concentrate Sales Agreement and revised payment instructions.

(h)           Financing
Statements. The Collateral
Agent shall have received evidence of the filing of all financing statements
under the Uniform Commercial Code with respect to each of Apex Luxembourg, Apex
Sweden, Apex Metals Marketing, Apex Silver Finance, SC Minerals Sweden and
Comercial Metales Blancos in each jurisdiction in which such financing
statements are necessary or desirable to perfect the Liens created by the
Reorganization Documents to which it is a party.

(i)            Acceptance of Appointment of Agent for Service. The Collateral Agent and the Administrative
Agent shall have received acceptances from CT Corporation System, located at
111 Eighth Avenue, New York, New York 10011, agreeing to serve as the
authorized agent for service of process appointed in New York for each of Apex
Metals Marketing and Apex Silver Finance.

(j)            Consent
of PRI Insurers. The
Administrative Agent shall have received from each PRI Provider a consent to
this Omnibus Amendment Agreement and the consummation of the transactions
contemplated hereby, in form and substance acceptable to the Administrative
Agent.

(k)           Bolivian
Documents. The
Administrative Agent shall have received (i) a copy of the Amendment to the

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Bolivian Conditional Assignment with respect to the
Borrower Concentrate Sales Agreement and (ii) evidence of registration in the
Borrower’s Shareholder Registry Book and corresponding share title certificates
of the endorsement and transfer of shares of the Borrower to SC Minerals Sweden
subject to the existing registered pledge thereof.

(l)            Payment
of Fees. The Borrower shall
have paid (i) to the Administrative Agent for the benefit of the Senior Lenders,
the amendment fee agreed in the fee letter dated as of the date hereof from the
Administrative Agent to the Borrower (ii) to Barclays Bank PLC as Hedge Bank
and BNP Paribas as Administrative Agent and Hedge Bank, the restructuring fees
agreed in the respective fee letters dated as of the date hereof from Barclays
Bank PLC and BNP Paribas, as applicable, to the Borrower, and (iii) to the
Administrative Agent and the Collateral Agent, all invoiced fees and expenses
(including reasonable fees and disbursements of counsel to the Administrative
Agent and the Collateral Agent) in respect of the transactions contemplated by
this Agreement.

(m)          Legal
Opinions. Unless the
Acquisition Effective Date is occurring concurrently with the Reorganization
Effective Date, the Administrative Agent and the Collateral Agent shall have
received the legal opinions (dated as of the Restructuring Effective Date and
addressed to the Administrative Agent, the Collateral Agent, each Senior Lender
and each Hedge Bank) listed in clauses (i) through (vi) of Section 5.02(e)
hereof.

(n)           Management
Services Agreement. Apex
Metals Marketing, Apex Silver Finance and Apex Silver Mines Corporation, a
Delaware corporation, shall have executed and delivered to the Administrative
Agent and the Collateral Agent the Apex Metals Marketing Management and
Services Agreement in the form of Appendix Q attached hereto.

(o)           Concentrate
Sale Agreement. Apex Metals
Marketing and the Borrower shall have executed and delivered to the
Administrative Agent and the Collateral Agent the Borrower Concentrate Sales
Agreement in the form of Appendix R attached hereto.

(p)           Amended
and Restated Management Services Agreement. The Borrower and Apex Silver Mines Corporation shall have executed
and delivered to the Administrative Agent and the Collateral Agent the Amended
and Restated Borrower Management Services Agreement in the form of
Appendix S hereto.

(q)           Tax
Report. The Administrative
Agent shall have received a report of PriceWaterhouseCoopers with respect to
certain tax implications of the transactions contemplated herein, in form and
substance satisfactory to the Administrative Agent.

Section 5.02.          Conditions Precedent
to Acquisition. The provisions of
Article IV of this Agreement shall become effective on the date on which
all of the following conditions precedent have been satisfied in form and
substance acceptable to (or shall have been waived by) each Secured Party (the “Acquisition
Effective Date”), provided that such date occurs not later than
December 31, 2006:

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(a)           Authorizations. The Administrative Agent and the Collateral
Agent shall have received (i) certified copies of the Organizational Documents
of Sumitomo and (ii) a certificate of an Authorized Officer of Sumitomo
certifying Sumitomo has duly approved and ratified pursuant to its internal
regulations the execution, delivery and performance by it of each Acquisition
Document to which it is a party, and the performance by it of its obligations
thereunder;

(b)           Incumbency and Signatures. The Administrative Agent and the Collateral
Agent shall have received certificates of Sumitomo in respect of the authority
and incumbency, and containing a specimen signature, of each Person who has
signed or will sign each Acquisition Document to which it is a party, on its behalf,
or who will, until replaced by another Person or Persons duly authorized for
that purpose, otherwise act as its representative for the purposes of signing
documents in connection with such documents and the transactions contemplated
thereby.

(c)           Acquisition
Documents.

(i)            Sumitomo
shall have executed and delivered to the Collateral Agent and the
Administrative Agent (A) the Sumitomo Completion Agreement, in substantially
the form attached as Appendix J hereto and (B) the Sumitomo Pledge and Guarantee
Agreement, in substantially the form attached as Appendix L hereto.

(ii)           Each
of Sumitomo, SC Minerals Sweden and Comercial Metales Blancos shall have
executed and delivered to the Collateral Agent and the Administrative Agent the
Sumitomo Transfer Restrictions Agreement, in substantially the form attached as
Appendix K hereto.

(d)           Acceptance of Appointment of Agent for Service. The Collateral Agent and the Administrative
Agent shall have received acceptances from CT Corporation System, located at
111 Eighth Avenue, New York, New York 10011, agreeing to serve as the
authorized agent for service of process appointed in New York for Sumitomo, SC
Minerals Sweden and Comercial Metales Blancos.

(e)           Legal
Opinions. The Administrative
Agent and the Collateral Agent shall have received the following legal opinions
dated as of the Acquisition Effective Date and addressed to the Administrative
Agent, the Collateral Agent, each Senior Lender and each Hedge Bank (provided
that if the Reorganization Effective Date occurred prior to the Acquisition
Effective Date, the opinions listed below that were delivered on the
Reorganization Effective Date need not be reissued or redelivered on the
Acquisition Effective Date):

(i)            The
opinion of Quintanilla & Soria Abogados, special Bolivian Counsel to the
Borrower, in the form attached hereto as Appendix M-1;

(ii)           The
opinions of Walkers & Co., special Cayman Islands counsel to the Borrower,
in the forms attached hereto as Appendix M-2-A and M-2-B;

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(iii)          The
opinion of Wistrand Advokatbyra, special Swedish counsel to the Borrower, in
the form attached hereto as Appendix M-3;

(iv)          The
opinion of SuterHowald, special Swiss counsel to the Borrower, in the form
attached hereto as Appendix M-4; and

(v)           The
opinion of Davis Graham & Stubbs LLP, special counsel to the Borrower, in
the form attached hereto as Appendix M-5;

(vi)          The
opinion of Bonn Schmitt Steichen Avocate, special Luxembourg counsel to the
Borrower, in the form attached hereto as Appendix M-8:

(vii)         The
opinion of Ito & Mitomi, special Japanese counsel to Sumitomo, in the form
attached hereto as Appendix M-6; and

(viii)        The
opinion of Morrison & Foerster LLP, special New York counsel to Sumitomo,
in the form attached hereto as Appendix M-7.

(f)            Financing
Statements. The Collateral
Agent shall have received evidence of the filing of all financing statements
under the Uniform Commercial Code with respect to Sumitomo in each jurisdiction
in which such financing statements are necessary or desirable to perfect the
Liens created by the Acquisition Documents to which it is a party.

ARTICLE VI

MISCELLANEOUS

Section 6.01.          Notices. All notices and other communications
provided for herein shall be in writing and shall be delivered by hand, mail or
overnight courier service, or sent by fax, to the address specified for such
party in the Financing Documents to which it is a party.

Section 6.02.          Expenses. The Borrower shall be solely responsible for
any and all out-of-pocket expenses, fees, charges, disbursements and any other
costs incurred by the each Agent, each Senior Lender, each Hedge Bank
(including the reasonable fees of counsel to the Administrative Agent and to
the Collateral Agent) in connection with the negotiation, execution and
delivery of this Agreement and the transactions contemplated hereby, which
costs shall be paid in full in cash in accordance with Section 15.14 of the
Common Security Agreement.

Section 6.03.          Counterparts;
Integration. This Agreement may be
executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which shall constitute an original, but all of
which when taken together shall constitute one and the same instrument. This
Agreement, together with the Financing Documents, constitute the entire
agreement between and among the parties relating to the subject matter thereof
and supersede any and all previous agreements and understandings, oral or
written, relating to the subject 

 53
 

 

 

matter
thereof. Delivery of an executed counterpart of a signature page to this Agreement
by fax shall be effective as delivery of a manually executed counterpart of
this Agreement.

Section 6.04.          Severability. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

Section 6.05.          Governing Law;
Jurisdiction; Service of Process; Etc.

(a)           Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.

(b)           Submission to Jurisdiction. Each party to this Agreement hereby
irrevocably agrees, for the benefit of each other party hereto, that any legal
action, suit or proceeding against it with respect to its obligations,
liabilities or any other matter under or arising out of or in connection with
this Agreement or any judgment entered by any court in respect thereof may be
brought in any Federal or State court located in the Borough of Manhattan, the
City of New York (including the Supreme Court of the State of New York sitting
in New York County and the United States District Court for the Southern
District of New York), and any appellate court from any thereof; and each party
hereby irrevocably accepts and submits to the non-exclusive jurisdiction of
each such court with respect to any such suit, action, proceeding or judgment
and hereby further waives and agrees not to plead or claim in any such court
that any such suit, action or proceeding brought therein has been brought in an
inconvenient forum. Each party to this Agreement further submits, for the
purpose of any such suit, action, proceeding or judgment brought or rendered
against it, to the appropriate courts of the jurisdiction of its domicile.

(c)           Other Service. Nothing herein shall in any way be deemed
to limit the ability of the any party hereto to serve any such writs, process
or summonses in any other manner permitted by applicable law or to obtain
jurisdiction over any other party in such other jurisdictions, and in such
manner, as may be permitted by applicable law.

Section 6.06.          WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT,
TORT OR ANY OTHER THEORY).

Section 6.07.          Headings. Article and Section headings and the Table
of Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

Section 6.08.          Waivers; Amendment. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified without
the consent of each of the parties hereto.

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Section 6.09.          Successors and
Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby and by the Financing
Document or the Mandatory Metals Hedge Agreements. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person, other than
the parties hereto and their respective successors and assigns permitted
hereby, any legal or equitable right, remedy or claim under or by reason of
this Agreement.

Section 6.10.          Limited Agreement. The amendments, waivers and consents set
forth in this Agreement are limited in effect, shall apply only as expressly
set forth herein and shall not constitute or be deemed to be an amendment or
waiver of any other provision of, or a consent to any action limited by, any
Financing Document, each of which shall remain in full force and effect and are
hereby ratified and confirmed in all respects.

Section 6.11.          Authorizations.

(a)           Each
of the Senior Lenders and Hedge Banks hereby authorizes the Administrative
Agent, the Collateral Agent and the Technical Agent to execute and deliver this
Agreement and each of the agreements in the forms attached hereto to which they
are required to be a party, and authorizes and directs the Collateral Agent (a)
on the Reorganization Effective Date, to release to ASM the Service Company
Shares and the Apex Metals Quotas held by the Collateral Agent and (b) on the
Acquisition Effective Date, to release to ASM the balance of the Contingent
Support Account on such date as contemplated in Section 4.02 hereof.

(b)           Each
of Apex Luxembourg, Apex Sweden and each of the Secured Parties hereby consents
to the termination and release of (i) the pledge of 35% of the Apex Silver
Finance Shares executed and delivered in accordance with Section 5.01(c)(i)
hereof, (ii) the pledge of 100% of the SC Minerals Sweden Shares executed and
delivered in accordance with 5.01(c)(vi) hereof and (iii) the pledge of 100% of
the Comercial Metales Blancos Shares executed and delivered in accordance with
Section 5.01(c)(v) hereof, concurrently with the pledge of such shares by
Sumitomo under the Sumitomo Pledge and Guarantee Agreement.

 

[The remainder of this page
intentionally left blank]

 55

 

IN
WITNESS WHEREOF, the parties hereto have caused this Omnibus Amendment
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.

 

	
  

  	
  MINERA SAN CRISTÓBAL, S.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeffrey Clevenger

  
	
   

  	
   

  	
  Name: Jeffrey Clevenger

  
	
   

  	
   

  	
  Title: Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  APEX SILVER MINES LIMITED

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald Malys

  
	
   

  	
   

  	
  Name: Gerald Malys

  
	
   

  	
   

  	
  Title: Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  APEX SILVER MINES SWEDEN AB

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Marcel DeGuire

  
	
   

  	
   

  	
  Name: Marcel DeGuire

  
	
   

  	
   

  	
  Title: Director

  

 

 

 

	
  

  	
  APEX LUXEMBOURG S.A. R.L.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald Malys

  
	
   

  	
   

  	
  Name: Gerald Malys

  
	
   

  	
   

  	
  Title: Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  APEX METALS GMBH

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marcel DeGuire

  
	
   

  	
   

  	
  Name: Marcel DeGuire

  
	
   

  	
   

  	
  Title: Managing Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  APEX SILVER FINANCE LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Vogels

  
	
   

  	
   

  	
  Name: Robert Vogels

  
	
   

  	
   

  	
  Title: Vice President

  

 

 S-2
 

 

 

	
  

  	
  APEX METALS MARKETING GmbH

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marcel DeGuire

  
	
   

  	
   

  	
  Name: Marcel DeGuire

  
	
   

  	
   

  	
  Title: Managing Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GOTLEX
  LAGERAKTIEBOLAG nr. 451,

  organizational number 556702-1083

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald Malys

  
	
   

  	
   

  	
  Name: Gerald Malys

  
	
   

  	
   

  	
  Title: Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  COMERCIAL METALES BLANCOS AB

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald Malys

  
	
   

  	
   

  	
  Name: Gerald Malys

  
	
   

  	
   

  	
  Title: Director

  

 

 S-3
 

 

 

	
  

  	
  BNP PARIBAS

  
	
   

  	
  as Administrative Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeffrey Stufsky

  
	
   

  	
   

  	
  Name: Jeffrey Stufsky

  
	
   

  	
   

  	
  Title: Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Greg Caione

  
	
   

  	
   

  	
  Name: Greg Caione

  
	
   

  	
   

  	
  Title: Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BARCLAYS CAPITAL

  
	
   

  	
  as Technical Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Colin Hall

  
	
   

  	
   

  	
  Name: Colin Hall

  
	
   

  	
   

  	
  Title: Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, N.A.,

  
	
   

  	
  as Collateral Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lucia Jaklitsch

  
	
   

  	
   

  	
  Name: Lucia Jaklitsch

  
	
   

  	
   

  	
  Title: Vice President

  

 

 S-4
 

 

 

	
  

  	
  JPMORGAN CHASE BANK, N.A.,

  
	
   

  	
  as Securities
  Intermediary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lucia Jaklitsch

  
	
   

  	
   

  	
  Name: Lucia Jaklitsch

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CORPORACIÓN ANDINA DE FOMENTO,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Luis Enrique Berribeitia

  
	
   

  	
   

  	
  Name: Luis Enrique Berribeitia

  
	
   

  	
   

  	
  Title: Acting Executive President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BARCLAYS BANK PLC,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Colin Hall

  
	
   

  	
   

  	
  Name: Colin Hall

  
	
   

  	
   

  	
  Title: Manager

  

 

 S-5
 

 

 

	
  

  	
  BNP PARIBAS,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeffrey Stufsky

  
	
   

  	
   

  	
  Name: Jeffrey Stufsky

  
	
   

  	
   

  	
  Title: Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Greg Caione

  
	
   

  	
   

  	
  Name: Greg Caione

  
	
   

  	
   

  	
  Title: Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AUSTRALIA AND
  NEW ZEALAND BANKING

  GROUP LIMITED, as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John W. Wade

  
	
   

  	
   

  	
  Name: John W. Wade

  
	
   

  	
   

  	
  Title: Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  KFW,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Wolfgang Behler

  
	
   

  	
   

  	
  Name: Wolfgang Behler

  
	
   

  	
   

  	
  Title: First Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dirk Sindermann

  
	
   

  	
   

  	
  Name: Dirk Sindermann

  
	
   

  	
   

  	
  Title: Vice President

  

 

 S-6
 

 

 

	
  

  	
  NATEXIS BANQUES POPULAIRES,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Amit Roy

  
	
   

  	
   

  	
  Name: Amit Roy

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Park

  
	
   

  	
   

  	
  Name: Robert Park

  
	
   

  	
   

  	
  Title: Associate

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CATERPILLAR
  FINANCIAL SERVICES (UK)

  LTD., as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Prandota

  
	
   

  	
   

  	
  Name: Robert Prandota

  
	
   

  	
   

  	
  Title: Credit & Operations Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  N M ROTHSCHILD & SONS LIMITED,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George Pyper

  
	
   

  	
   

  	
  Name: George Pyper

  
	
   

  	
   

  	
  Title: Assistant Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christopher Coleman

  
	
   

  	
   

  	
  Name: Christopher Coleman

  
	
   

  	
   

  	
  Title: Managing Director

  

 

 S-7
 

 

 

	
  

  	
  EXPORT DEVELOPMENT CANADA,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Isha Aggarwal

  
	
   

  	
   

  	
  Name: Isha Aggarwal

  
	
   

  	
   

  	
  Title: Asset Management

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Howard Clysdale

  
	
   

  	
   

  	
  Name: Howard Clysdale

  
	
   

  	
   

  	
  Title: Portfolio Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  FORTIS CAPITAL CORP.,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Trond Rokholt

  
	
   

  	
   

  	
  Name: Trond Rokholt

  
	
   

  	
   

  	
  Title: Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Darrel Ho

  
	
   

  	
   

  	
  Name: Darrel Ho

  
	
   

  	
   

  	
  Title: Vice President

  

 

 S-8
 

 

 

	
  

  	
  NORDKAP BANK AG,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stefan Peria

  
	
   

  	
   

  	
  Name: Stefan Peria

  
	
   

  	
   

  	
  Title: CIO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kershin Rotter

  
	
   

  	
   

  	
  Name: Kershin Rotter

  
	
   

  	
   

  	
  Title

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  RMB INTERNATIONAL (DUBLIN) LIMITED,

  
	
   

  	
  as a Senior Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephen Peters

  
	
   

  	
   

  	
  Name: Stephen Peters

  
	
   

  	
   

  	
  Title: Authorised Signatory

  
	
   

  	
   

  	
  RMB International
  (Dublin) Ltd.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Derek Coetzee

  
	
   

  	
   

  	
  Name: Derek Coetzee

  
	
   

  	
   

  	
  Title: Authorised Signatory

  
	
   

  	
   

  	
  RMB International
  (Dublin) Ltd.

  

 

 S-9
 

 

 

	
  

  	
  BARCLAYS BANK PLC,

  
	
   

  	
  as a Hedge Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Colin Hall

  
	
   

  	
   

  	
  Name: Colin Hall

  
	
   

  	
   

  	
  Title: Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BNP PARIBAS,

  
	
   

  	
  as a Hedge Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christopher Taylor

  
	
   

  	
   

  	
  Name: Christopher Taylor

  
	
   

  	
   

  	
  Title: Vice President/Derivatives Credit

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dora Sung

  
	
   

  	
   

  	
  Name: Dora Sung

  
	
   

  	
   

  	
  Title: Managing Director

  
	
   

  	
   

  	
  BNP Paribas/CIT Group

  

 

 S-10Exhibit
10.6

FORM OF CHANGE OF CONTROL AGREEMENT

[Name]

[Title]

Dear
[Name]:

Apex Silver Mines Limited (the “Company”) considers it essential to the
best interests of its stockholders to foster the continuous employment of key
management personnel.  In this
connection, the Board of Directors of the Company (the “Board”) recognizes
that, as is the case with many publicly held corporations, the possibility of a
Change of Control (as defined in Section 2 hereof) may exist and that such
possibility, and the uncertainty and questions which it may raise among
management, may result in the departure or distraction of management personnel
to the detriment of the Company and its stockholders.

The Board has determined that appropriate steps should be taken to
reinforce and encourage the continued attention and dedication of members of
the Company’s management, including yourself, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from
the possibility of a Change of Control, although no such change is now
contemplated.

In order to induce you to remain in the employ of the Company, the
Company agrees that you shall receive the severance benefits set forth in this
letter agreement (the “Agreement”) in the event your employment with the
Company is terminated subsequent to a Change of Control under the circumstances
described below.

1.  TERM OF AGREEMENT.  This Agreement shall commence on the date
hereof and shall continue from year to year at the discretion of the Board of
Directors.  Provided no Change of Control
shall have occurred, the Company may terminate this Agreement at any time upon
12 months prior written notice to
you; provided, however, that after a Change of Control during the
term of this Agreement, this Agreement shall remain in effect until all of the
obligations of the parties under the Agreement are satisfied and the two year
period referred to in the definition of “Good Reason” has expired.  Notwithstanding the foregoing, and provided
no Change of Control shall have occurred, this Agreement shall automatically
terminate upon the earlier to occur of (i) your termination of employment with
the Company, or (ii) the Company’s furnishing you with notice of termination of
employment, irrespective of the effective date of such termination.

2.  CHANGE OF CONTROL.  No benefits shall be payable hereunder unless
there shall have been a Change of Control, as set forth below.  For purposes of this Agreement, a “Change of
Control” shall mean the first to occur of the following events specified in
(A), (B), (C), (D) or (E) (but no event other than the specified events):  (A) any person becomes the beneficial owner,
directly or indirectly, of securities of the Company representing thirty-five
percent (35%) or more of the combined voting power of the Company’s then
outstanding voting securities (other than

 

(i) the Company, (ii) any subsidiary of the Company, or (iii) one or
more employee benefit plans maintained by the Company); (B) three or more
Directors of the Company, whose election or nomination for election is not
approved by a majority of the applicable Incumbent Board, are elected within
any single twelve month period to serve on the Board; (C) members of the
applicable Incumbent Board cease to constitute a majority of the Board; (D) the
consummation of a merger or consolidation of the Company with or into any other
corporation or entity or person, or any other corporate reorganization, in
which the stockholders of the Company immediately prior to such consolidation,
merger or reorganization own less than 50% of the outstanding voting securities
of the surviving entity (or its parent) following the consolidation, merger or
reorganization or (E) the consummation of a sale, lease or other disposition of
all or substantially all of the assets of the Company.  For purposes of Section 2(A) hereof, the
terms “person” and “beneficial owner” shall have the meanings set forth in
Section 13(d) and Rule 13d-3, respectively, of the Securities Exchange Act of
1934, as amended, and in the regulations promulgated thereunder.  For purposes of this Section 2, “Incumbent Board”
means (i) members of the Board of Directors of the Company as of the date
hereof, to the extent that they continue to serve as members of the Board, and
(ii) any individual who becomes a member of the Board after the date hereof, if
such individual’s election or nomination for election as a Director was
approved by a vote of at least seventy-five percent (75%) of the then
applicable Incumbent Board.

3.  TERMINATION FOLLOWING CHANGE
OF CONTROL.  If the events described in
Section 2 hereof constituting a Change of Control shall have occurred during
the term of this Agreement, you shall be entitled to the benefits provided in
Subsection 4(iii) hereof upon the subsequent termination of your employment
within 2 years after the occurrence of such Change of Control unless such
termination is (A) because of your death or Disability, (B) by the Company for
Cause, or (C) by you other than for Good Reason.

(i)                                     Disability. 
If, as a result of your incapacity due to physical or mental illness,
you shall have been absent from the full-time performance of your duties with
the Company for six consecutive months, and within 30 days after written notice
of termination is given you shall not have returned to the full-time
performance of your duties, your employment may be terminated for “Disability.”

(ii)                                  Cause. 
Termination by the Company of your employment for “Cause” shall mean
termination for (A) the commission of a felony or a crime involving moral
turpitude or the commission of any other act involving dishonesty, disloyalty,
or fraud with respect to the Company, (B) conduct tending to bring the Company
into substantial public disgrace or disrepute, (C) substantial and repeated
failure to perform duties as reasonably directed by the Board, (D) gross
negligence or willful misconduct with respect to the Company or any of its
affiliated entities, or (E) any other material breach of any other agreement
between you and the Company or its affiliated entities which is not cured
within 15 days after written notice thereof to you.

(iii)                               Good Reason. 
You shall be entitled to terminate your employment for Good Reason.  For purposes of this Agreement, “Good Reason”
shall mean, without your express written consent, the occurrence within 2 years
after a Change of Control of any of the following circumstances unless, in the
case of paragraphs (A), (B), (E), (F), (G) or (H), such circumstances are fully
corrected prior to the Date of Termination specified in the Notice of
Termination, as such terms are defined in Subsections 3(v) and 3(iv) hereof,
respectively, given in respect thereof:

 2
 

 

(A)                              the assignment to you of any duties
inconsistent with your current status as an executive of the Company or a
substantial adverse alteration in the nature or status of your responsibilities
from those in effect immediately prior to the Change of Control;

(B)                                a reduction by the Company in your annual
base salary as in effect on the date hereof or as the same may be increased
from time to time, except for across-the-board salary reductions similarly affecting
all senior executives of the Company and all senior executives of any person in
control of the Company;

(C)                                your relocation to a location not within 25
miles of your present office or job location, except for required travel on the
Company’s business to an extent substantially consistent with your present
business travel obligations;

(D)                               the failure by the Company to pay to you any
portion of your current compensation, or to pay to you any portion of an
installment of deferred compensation under any deferred compensation program of
the Company, within seven days of the date such compensation is due;

(E)                                 the failure by the Company to continue in
effect any bonus to which you were entitled, or any compensation plan in which
you participated immediately prior to the Change of Control which is material
to your total compensation, including but not limited to the Company’s
Incentive Bonus Plan, Stock Option Plan, 401(k) Profit Sharing Plan, or any
substitute plan or plans adopted prior to the Change of Control, unless an
equitable arrangement (embodied in an ongoing substitute or alternative plan)
has been made with respect to such plan and such equitable arrangement provides
substantially equivalent benefits not materially less favorable to you (both in
terms of the amount of benefits provided and the level of your participation
relative to other participants), or the failure by the Company to continue your
participation therein (or in such substitute or alternative plan) on a basis
not materially less favorable (both in terms of the amount of benefits provided
and the level of your participation relative to other participants) as existed
at the time of the Change of Control of the Company.

(F)                                 the failure by the Company to continue to
provide you with benefits substantially similar or superior to those enjoyed by
you under any of the Company’s life insurance, medical, dental, and accident,
or disability plans in which you were participating at the time of the Change
of Control, the taking of any action by the Company which would directly or
indirectly materially reduce any of such benefits or deprive you of any
material fringe benefit enjoyed by you at the time of the Change of Control, or
the failure by the Company to provide you with the number of paid vacation days
to which you are entitled in accordance with the Company’s normal vacation
policy in effect at the time of the Change of Control;

(G)                                the failure of the Company to obtain a
satisfactory agreement from any successor to assume and agree to perform this
Agreement, as contemplated in Section 5 hereof; or

(H)                               any purported termination of your employment
which is not effected pursuant to a Notice of Termination satisfying the
requirements of Subsection 3(iv) hereof (and,

 3
 

 

if applicable, the
requirements of Subsection 3(ii) hereof); for purposes of this Agreement, no
such purported termination shall be effective.

Your rights to terminate
your employment pursuant to this Subsection 3(iii) shall not be affected by
your incapacity due to physical or mental illness.  Your continued employment shall not
constitute consent to, or a waiver of rights with respect to, any circumstance
constituting Good Reason hereunder.

(iv)                              NOTICE OF TERMINATION.  Any purported termination of your employment
by the Company or by you shall be communicated by written Notice of Termination
to the other party hereto in accordance with Section 6 hereof.  For purposes of this agreement, a “Notice of
Termination” shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination
of your employment under the provision so indicated.

(v)                                 DATE OF TERMINATION, ETC.  “Date of Termination” shall mean (A) if your
employment is terminated for Disability, 30 days after Notice of Termination is
given (provided that you shall not have returned to the full-time performance
of your duties during such 30-day period), (B) if your employment is terminated
pursuant to Subsection 3(ii) hereof or for any other reason (other than
Disability), the date specified in the Notice of Termination (which shall not
be less than 30 nor more than 60 days from the date such Notice of Termination
is given) or (C) if your employment is terminated pursuant to Subsection 3(iii)
hereof, the date specified in the Notice of Termination (which shall not be
less than 15 nor more than 60 days from the date such Notice of Termination is
given).

4.  COMPENSATION UPON TERMINATION
OR DURING DISABILITY.  Following a Change
of Control, as defined by Section 2 hereof, upon termination of your employment
within 2 years after the occurrence of such Change of Control or during a
period of Disability you shall be entitled to the following benefits:

(i)                                     During any period that you fail to perform
your full-time duties with the Company as a result of incapacity due to
physical or mental illness, you shall continue to receive your base salary at
the rate in effect at the commencement of any such period, together with all
amounts payable to you under any compensation plan of the Company during such
period, until this Agreement is terminated pursuant to Subsection 3(i)
hereof.  Thereafter, or in the event your
employment shall be terminated by you other than for Good Reason or by reason
of your death, your benefits shall be determined under the Company’s insurance
or other compensation programs then in effect in accordance with the terms of
such programs.

(ii)                                  If your employment shall be terminated by the
Company for Cause, Disability or death, or by you other than for Good Reason,
the Company shall, to the extent not theretofore paid, pay you in a lump sum
your full base salary through the Date of Termination at the rate in effect at
the time Notice of Termination is given within 10 business days of the
Date of Termination, plus all other amounts to which you are entitled under any
insurance and other compensation programs of the Company at the time such
payments are due, and the Company shall have no further obligations to you
under this Agreement.

 4
 

 

(iii)                               If your employment by the Company shall be
terminated (a) by the Company other than for Cause, Disability or death or (b)
by you for Good Reason, then you shall be entitled to the benefits provided
below:

(A)                              The Company shall, to the extent not
theretofore paid, pay you in a lump sum your full base salary through the Date
of Termination at the rate in effect at the time Notice of Termination is given
within 10 business days of the Date of Termination, plus all other amounts to
which you are entitled under any compensation plan of the Company, at the time
such payments are due, except as otherwise provided below.

(B)                                In lieu of any further salary payments to you
for periods subsequent to the Date of Termination, the Company shall pay as
severance pay to you a lump sum severance payment (together with the payments
provided in paragraph (C) of this Subsection 4(iii), the “Severance Payments”)
equal to          times the sum of (a)
your annual base salary in effect immediately prior to the occurrence of the
circumstance giving rise to the Notice of Termination given in respect thereof,
and (b) 100% of your target bonus amount established pursuant to the
compensation or bonus plan in effect immediately prior to the occurrence of the
circumstance giving rise to the Notice of Termination.  The Severance Payments shall be made within 10 business
days of the Date of Termination.

(C)                                The Company shall pay to you any deferred
compensation, including but not limited to deferred bonuses, allocated or
credited to you as of the Date of Termination.

(D)                               The Company shall also pay to you all legal
fees and expenses incurred by you prior to December 31 of the second calendar
year following the calendar year that includes the Date of Termination as a
result of such termination including all such fees and expenses, if any,
incurred in contesting or disputing any such termination or in seeking to
obtain or enforce any right or benefit provided by this Agreement.

(E)                                 Taxes - All payments shall be subject to the
withholding of such amounts as the Company is required to be withheld pursuant
to any applicable federal, state, or local law or regulation, and you are
responsible for any tax liability on such payments.

(F)                                 All payments under this Agreement will be
contingent upon the execution of a Release of Claims by you and the
Company, and this Release of Claims shall govern the timing of all
payments made.  A copy of the terms and
conditions of such Release of Claims is attached as an appendix to this
Agreement.

(G)                                Gross-Up
of Benefits.  Anything in this Agreement
to the contrary notwithstanding, in the event it shall be determined that any
payment or distribution by the Company to or for your benefit (whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement
or otherwise, but determined without regard to any additional payments required
under this Section 4.(iii)(G) (a “Payment”) would be subject to the excise
tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended,
including any regulations adopted thereunder (the “Code”), or any interest or
penalties are

 5
 

 

incurred by you with respect to such excise tax that
are not due to your actions or inactions (such excise tax, together with any
such interest and penalties, are hereinafter collectively referred to as the “Excise
Tax”), then you shall be entitled to receive an additional payment (a “Gross-Up
Payment”) in an amount such that after payment by you of all taxes imposed upon
the Gross-Up Payment (including any federal, state, and local income taxes,
employment taxes under Section 3101(b) of the Code, and Excise Taxes,
assuming the highest marginal income tax rates apply to the Gross-Up Payment),
you retain an amount of the Gross-Up Payment equal to the Excise Tax imposed
upon the Payments.  In the event you are
entitled to a Gross-Up Payment, the following shall apply:

(1)                                  All
determinations required to be made, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up Payment, shall be made by a
nationally recognized certified public accounting firm selected by the Company
(the “Accounting Firm”).  The Accounting
Firm shall be requested to provide detailed supporting calculations both to the
Company and you within 15 business days of the receipt of notice that
there has been a Payment.  All fees and
expenses of the Accounting Firm shall be borne solely by the Company.  Any Gross-Up Payment shall be paid by the
Company to you within 5 days of the receipt of the Accounting Firm’s
determination.  Any determination by the
Accounting Firm shall be binding upon the Company and you.  As a result of uncertainty in the application
of Sections  280G and 4999 of the Code, it is possible that Gross-Up
Payments that will not have been made by the Company should have been made (an “Underpayment”).  In the event the Company exhausts its
remedies pursuant to the following paragraph and you are thereafter required to
make a payment of any Excise Tax, the Accounting Firm shall be requested to
determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to you.

(2)                                  You
shall notify the Company in writing of any assertion by the Internal Revenue
Service that, if successful, would require the payment by the Company of an
Underpayment.  Such notification shall be
given as soon as practicable, but no later than 10 business days after you
are informed of such assertion.  You
shall apprise the Company of the nature of such assertion and provide copies of
all letters, notices, etc. regarding the assertion, and written summaries of
any statements made to you or by you in connection with the assertion.  You shall not pay any amount asserted to be
due prior to the expiration of the 30-day period following the date on which
you give such notice to the Company (or such shorter period ending on the date
that any payment of taxes with respect to such assertion is due).  If the Company notifies you in writing prior
to the expiration of such period that the Company desires to contest such
assertion, you shall:

(a)                                  give
the Company any information reasonably requested by the Company relating to
such assertion,

(b)                                 take
such action in connection with contesting such assertion as the Company shall
reasonably request in writing from time to time,

 6
 

 

including, without limitation, accepting legal
representation with respect to such assertion by an attorney reasonably
selected by the Company,

(c)                                  cooperate
with the Company in good faith in order effectively to contest such assertion,
and

(d)                                 permit
the Company to participate in any proceedings relating to such assertion;

provided,
however, that the
Company shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest,
and shall indemnify and hold you harmless, on an after-tax basis, for any
Excise Tax and income and employment tax (including interest and penalties)
imposed as a result of such representation and payment of costs and
expenses.  The Company shall control all
proceedings taken in connection with such contest, and, at its sole discretion,
may pursue or forgo any and all administrative appeals, proceedings, hearings
and conferences with the applicable taxing authority in respect of such
assertion and may, at its sole discretion, either direct you to pay the tax
asserted and sue for a refund or contest the claim in any permissible manner,
and you agree to prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more appellate
courts, as the Company shall determine; provided, however, that, if the Company
directs you to pay such claim and sue for a refund, the Company shall advance
the amount of such payment to you, on an interest-free basis, and shall
indemnify and hold you harmless, on an after-tax basis, from any Excise Tax and
income and employment tax (including interest or penalties) imposed with
respect to such advance or with respect to any imputed income in connection
with such advance; and provided, further, that any extension of the statute of
limitations relating to payment of taxes for the taxable year with respect to
which such contested amount is claimed to be due is limited solely to such
contested amount.  Furthermore, the
Company’s control of the contest shall be limited to issues with respect to
which the Gross-Up Payment would be payable hereunder, and you shall be
entitled to settle or contest, as the case may be, any other issue raised by
the Internal Revenue Service or any other taxing authority.

(3)                                  If,
after the receipt by you of a Gross-Up Payment or an amount advanced by the
Company, you become entitled to receive any refund with respect to the Excise
Tax to which such Gross-Up Payment relates or with respect to such claim, you
shall (subject to the Company’s complying with the requirements of this
Section, if applicable) promptly pay to the Company the amount of such refund
(together with any interest paid or credited thereon after taxes applicable
thereto).  If, after the receipt by you
of an amount advanced by the Company pursuant to this Section, a determination
is made that you shall not be entitled to any refund with respect to such claim
and the Company does not notify you in writing of its intent to contest such
denial of refund prior to the expiration of 30 days after such
determination, then such advance shall be forgiven

 7
 

 

and shall not be required to be repaid and the amount
of such advance shall offset, to the extent thereof, the amount of Gross-Up
Payment required to be paid.

(iv)                              If your employment shall be terminated (A) by
the Company other than for Cause, Disability or death or (B) by you for Good
Reason, then, provided you timely elect continuation coverage under the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”),
the Company shall pay, on your behalf, the portion of premiums of your group
health insurance, including coverage for your eligible dependents, that the
Company paid immediately prior to the Date of Termination (“COBRA Payments”)
for the period that you are entitled to coverage under COBRA, but not to exceed
       months (“COBRA Period”).  The Company will pay such COBRA Payments for
your eligible dependents only for coverage for which those dependents were
enrolled immediately prior to the Date of Termination.  You will continue to be required to pay that
portion of the premium of your health coverage, including coverage for your eligible
dependents, that you were required to pay as an active employee immediately
prior to the Date of Termination.  Within
30 days following the end of the COBRA Period, the Company shall pay to you in
a lump sum an amount equal to the product of (x) the amount of the COBRA
payment paid on your behalf for the final month of the COBRA Period and (y) the
number of months by which the Cobra Period was less than       .

(v)                                 If your employment shall be terminated (A) by
the Company other than for Cause, Disability or death or (B) by you for Good
Reason then for a       -month period after such
termination, the Company shall arrange to provide you, at a cost not to exceed
$5,000 in the aggregate, with life, disability, and accident insurance benefits
substantially similar to those that you are receiving immediately prior to the
Notice of Termination.  Benefits
otherwise receivable by you pursuant to this Subsection 4(v) shall be reduced
to the extent comparable benefits are actually received by you from another employer
during the       -month period following your
termination, and any such benefits actually received by you shall be reported
to the Company.

(vi)                              You shall not be required to mitigate the
amount of any payment provided for in this Section 4 by seeking other
employment or otherwise, nor shall the amount of any payment or benefit
provided for in this Section 4 be reduced by any compensation earned by you as
the result of employment by another employer, by retirement benefits, by offset
against any amount claimed to be owed by you to the Company (other than by any
cash payments which may be available to you under the Company’s Severance
Policy), or otherwise except as specifically provided in this Section 4.

(vii)                           In addition to all other amounts payable to
you under this Section 4, you shall be entitled to receive all benefits
available to you under the Company’s Employees’ Share Option Plan, 401(k)
profit sharing plan, and to Outplacement benefits as defined in Section 5.5 of
the Company’s Severance Policy.

(viii)                        Anything in
this Agreement to the contrary notwithstanding, if on the Date of Termination
of your employment with the Company, as a result of such termination, you would
receive any payment that, absent the application of this Section 4(viii),
would be subject to interest and additional tax imposed pursuant to Section
409A(a) of the Code as a result of the application of Section 409A(2)(B)(i) of
the Code, then such payment shall be payable on the date that is the earliest
of (i) six (6) months after the Date of Termination,

 8
 

 

(ii) your death or
(iii) such other date as will not result in such payment being subject to
such interest and additional tax.  It is
the intention of the parties that payments or benefits payable under this
Agreement not be subject to the additional tax imposed pursuant to Section 409A
of the Code.  To the extent such
potential payments or benefits could become subject to such Section, the
parties shall cooperate to amend this Agreement with the goal of giving you the
economic benefits described herein in a manner that does not result in such tax
being imposed (it being understood that if such amendments do not avoid the
application of Section 409A of the Code, the Company will make such payments
nonetheless).

5.  SUCCESSORS; BINDING AGREEMENT.

(i)                                     The Company will require any successor
(whether direct or indirect, by purchase, merger, share exchange, consolidation
or otherwise) to all or substantially all of the business and/or assets of the
Company to assume expressly and agree to perform this Agreement in the same manner
and to the same extent that the Company would be required to perform it if no
such succession had taken place.  Failure
of the Company to obtain such assumption and agreement prior to the
effectiveness of any such succession shall be a breach of this Agreement and
shall entitle you to compensation from the Company in the same amount and on
the same terms as you would be entitled to hereunder if you terminate your
employment for Good Reason following a Change of Control, except that for
purposes of implementing the foregoing, the date on which any such succession
becomes effective shall be deemed the Date of Termination.  As used in this Agreement, “Company” shall
mean the Company as hereinbefore defined and any successor to its business
and/or assets as aforesaid which assumes and agrees to perform this agreement
by operation of law, or otherwise.

(ii)                                  This Agreement shall inure to the benefit of
and be enforceable by your personal or legal representatives, executors,
administrators, heirs, distributees and legatees.  If you should die while any amount would
still be payable to you hereunder if you had continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this agreement to your legatee or other designee or, if there is no
such designee, to your estate.

(iii)                               In the event that you are employed by a
subsidiary of the Company, wherever in this Agreement reference is made to the “Company,”
unless the context otherwise requires, such reference shall also include such
subsidiary.  The Company shall cause such
subsidiary to carry out the terms of this Agreement insofar as they relate to
the employment relationship between you and such subsidiary, and the Company
shall indemnify you and save you harmless from and against all liability and
damage you may suffer as a consequence of such subsidiary’s failure to perform
and carry out such terms.  Wherever
reference is made to any benefit program of the Company, such reference shall
include, where appropriate, the corresponding benefit program of such
subsidiary if you were a participant in such benefit program on the date a
Change of Control has occurred.

6.  NOTICE.  For the purpose of this Agreement, notices
and all other communications provided for in the Agreement shall be in writing
and shall be deemed to have been duly given when delivered or mailed by United
States registered mail, return receipt requested, postage prepaid, addressed to
the respective addresses set forth on the first page of this Agreement,
provided that all notices to the Company shall be directed to the attention of
the Board with a copy to the

 9
 

 

Secretary of the Company, or to such other address as either party may
have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon receipt.

7.  MISCELLANEOUS.  No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing and signed by you and such officer as may be specifically
designated by the Board.  No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.  No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof have
been made by either party which are not expressly set forth in this
Agreement.  To the extent that United
States federal laws do not otherwise apply, this Agreement shall be construed
in accordance with and governed by the laws of the Cayman Islands.

8.  VALIDITY.  The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.

9.  COUNTERPARTS.  This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

10.  ARBITRATION.  Any dispute or controversy arising under or
in connection with this Agreement shall be settled exclusively by arbitration
in the State of Colorado, in accordance with the rules of the American
Arbitration Association then in effect. 
Judgment may be entered on the arbitrator’s award in any court having
jurisdiction; provided, however, that you shall be entitled to seek specific
performance of your right to be paid until the Date of Termination during the
pendency of any dispute or controversy arising under or in connection with this
Agreement.

[remainder of page intentionally left blank]

 10
 

 

If this letter sets forth our agreement on the subject matter hereof,
kindly sign and return to the Company the enclosed copy of this letter which
will then constitute our agreement on this subject.

Sincerely,

Apex
Silver Mines Limited

	
  By

  	
   

  	
   

  
	
   

  
	
   

  
	
  Agreed to as of
  the        day of                               .

  
	
   

  
	
   

  
	
  Signature:

  	
   

  	
   

  
	
   

  	
   [Name]

  
				

 

 11

 

APPENDIX

FORM OF

GENERAL RELEASE

I,
                                      ,
for good and valuable consideration, including the performance by Apex Silver
Mines Limited, a Cayman Islands company (the “Company”), of certain obligations
under that certain Change of Control Agreement dated as of                         
between myself and the Company (the “Change of Control Agreement”), do hereby
release and forever discharge as of the date hereof, the Company and all
present, future and former subsidiaries, affiliates, directors, officers,
agents, attorneys, insurers, shareholders, representatives and employees of the
Company (including all subsidiaries, affiliates, directors, officers, agents,
attorneys, insurers, shareholders, partners, representatives and employees
thereof), and the successors and assigns of each of them (collectively, the “Released
Parties”) to the extent provided below.

1.  Except as provided in
Section 2 below, I knowingly and voluntarily release and forever discharge
the Company and the other Released Parties from any and all claims,
controversies, actions, causes of action, cross-claims, counter-claims,
demands, debts, damages (however styled, including compensatory, liquidated,
punitive or exemplary damages), claims for costs and attorneys’ fees, or
liabilities of any nature whatsoever in law and in equity, both past and
present (from the beginning of the world through the date of this General
Release) and whether known or unknown, suspected, or claimed against the
Company or any of the Released Parties which I, my spouse, or any of my heirs,
executors, administrators, representatives or assigns, have or may have, which
arise out of or are connected with my employment or association with, or my
separation or termination from, the Company (including, but not limited to, any
allegation, claim or violation, arising under: 
Title VII of the Civil Rights Act of 1964, as amended; the Civil
Rights Act of 1991, as amended; the Equal Pay Act of 1963, as amended; the
Americans with Disabilities Act of 1990, as amended; the Family and Medical
Leave Act of 1993, as amended; the Civil Rights Act of 1866, as amended; the
Age Discrimination in Employment Act (29 U.S.C. § 621 et seq.),
as amended (“ADEA”), subject to Section 15 below; the Worker Adjustment Retraining
and Notification Act, as amended; the Employee Retirement Income Security Act
of 1974, as amended; any applicable Executive Order Programs; the Fair Labor
Standards Act, as amended; or their state or local counterparts; or under any
other federal, state or local civil or human rights law, or under any other
local, state, or federal law, regulation or ordinance; or under any public
policy, contract or tort, or under common law; or arising under any policies,
practices or procedures of the Company; or any claim for wrongful discharge,
breach of contract, infliction of emotional distress, defamation; or any claim
for costs, fees, or other expenses, including attorneys’ fees incurred in these
matters) (all of the foregoing collectively referred to herein as the “Claims”).  As part of the release set forth in this
Section 1, I fully and forever covenant not to sue or cause to be sued the
Company or any other Released Party with respect to any Claims.

2.  This General Release
shall not relinquish, diminish, or in any way affect (i) any accrued
benefits under the terms of the Change of Control Agreement or any other plans
or programs of the Company which are due to me, or (ii) rights for
indemnification as a director of the Company

 A-1

 

under the Company’s
certificate of incorporation or bylaws for duly approved acts taken prior to
the date of this General Release, subject to the provisions thereof.

3.  I represent that I have
made no assignment or transfer of any Claims, or any other matter covered by
Section 1 above.  I agree that I
will indemnify, defend and hold harmless the Company from any and all Claims so
assigned and transferred.  I have not
been involved in any personal bankruptcy or other insolvency proceedings at any
time since I began my employment with the Company.  No child support orders, garnishment orders,
or other orders requiring that money owed to me by the Company be paid to any
other person are now in effect.

4.  In signing this General
Release, I acknowledge and intend that it shall be effective as a bar to each
and every one of the Claims hereinabove mentioned or implied that are released
by me.  I further acknowledge and agree
that my separation from employment with the Company shall not serve as the
basis for any claim or action.  I agree
that this General Release shall be given full force and effect according to
each and all of its express terms and provisions, including those relating to
unknown and unsuspected Claims (notwithstanding any state statute that expressly
limits the effectiveness of a general release of unknown, unsuspected and
unanticipated Claims), if any, as well as those relating to any other Claims
hereinabove mentioned or implied.  I
acknowledge and agree that this waiver is an essential and material term of
this General Release.  I therefore agree
that in the event a Claim is brought seeking damages against me in violation of
the terms of this General Release, or in the event a party should seek to
recover against the other in any Claim brought by a governmental agency on such
party’s behalf, this General Release shall serve as a complete defense to such
Claims.  I further agree that I am not
aware of any pending or threatened charge or complaint of the type described
above as of the execution of this General Release.

5.  I agree that, by my
signature below, I hereby resign from all positions, including any board
memberships, related to the Company and its subsidiaries contemporaneously with
the execution of this General Release.

6.  I understand that this
General Release embodies the complete agreement and understanding among the
parties with respect to the subject matter hereof and supersedes and preempts
any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof
in any way.

7.  Whenever possible, each
provision of this General Release shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this General
Release is held by any court of competent jurisdiction to be invalid, illegal
or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or any other jurisdiction, but this General Release shall
be reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.

8.  This General Release
shall be binding in all respects upon, and shall inure to the benefit of, the
heirs, successors and assigns of the parties hereto; provided that I
acknowledge that I may not assign my rights under the this General Release
without the prior written consent of the Company.  I agree, upon reasonable request of the
Company, to execute, acknowledge and deliver

 

any additional
instrument or documents that may be reasonably required to carry out the
intentions of this General Release.  This
General Release may be executed in counterparts and facsimile signatures shall
be originals for all purposes.

9.  I agree that this
General Release shall be interpreted and construed in accordance with the laws
of the State of Colorado and that any disputes arising under this General
Release or by any asserted breach of it, or from the employment relationship
between the Company and Executive, shall be litigated in the state or federal
courts in Colorado and I consent to such jurisdiction.

10.  I represent that I am
over the age of forty (40).  As part of
the release set forth in Section 1, I knowingly and voluntarily agree to
waive any rights or claims arising out of or relating to the ADEA (the “ADEA
Waiver”) and acknowledge that I have been informed of the following:

a.                                       I
represent and acknowledge that I am waiving any and all rights or claims that I
may have arising under the ADEA;

b.                                      I
represent and acknowledge that I have been informed of my right to consult with
an attorney regarding these ADEA rights, before executing this General Release;

c.                                       I
know and understand that I am not waiving any rights or claims that may arise
after the date this waiver of ADEA rights is executed;

d.                                      I
know and understand that in exchange for the waiver of my rights under the
ADEA, I am receiving consideration in addition to any consideration to which I
am already entitled;

e.                                       BY
SIGNING THIS GENERAL RELEASE, I REPRESENT AND ACKNOWLEDGE THAT I HAVE BEEN
INVITED AND ADVISED TO CONSULT AN ATTORNEY BEFORE SIGNING THIS DOCUMENT.  I acknowledge and understand that I have been
given a period of at least twenty-one (21) days in which to consider the
terms of the ADEA Waiver provided to me; and

f.                                         I
understand that I have the right to revoke this ADEA Waiver contained in this
General Release at any time within seven (7) days after signing this
General Release, by providing written notice to the following address:  Apex Silver Mines Limited,                                                             ,
and that, upon such revocation, this General Release will not have any further
legal force and effect.  I further
understand and agree that this General Release shall not become effective or
enforceable until this seven day revocation period has expired.

 

By signing this General Release, I further represent
and agree that:

(i)                                     I
have read it carefully;

(ii)                                  I
understand all of its terms and know that I am giving up important rights,
including but not limited to, rights under Title VII of the Civil Rights
Act of 1964, as amended; the Equal Pay Act of 1963, as amended; the Americans
with Disabilities Act of 1990, as amended; and the Employee Retirement Income
Security Act of 1974, as amended;

(iii)                               I
voluntarily consent to everything in this General Release;

(iv)                              I
have been advised to consult with an attorney before executing this General
Release and I have done so or, after careful reading and consideration I have
chosen not to do so of my own volition;

(v)                                 I
have signed this General Release knowingly and voluntarily and with the advice
of any counsel retained to advise me with respect to this General Release;

(vi)                              I
agree that the provisions of this General Release may not be amended, waived,
changed or modified except by an instrument in writing signed by an authorized
representative of the Company and by me.

	
  DATE:
                                  ,
  20        

  	
   

  
	
   

  	
  [Executive]

  

 

Acknowledged and agreed to this           
day of                               ,
20      

	
   

  	
  Apex Silver Mines Limited,

  
	
   

  	
  a Cayman Islands company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

 

SCHEDULE
TO FORM OF

CHANGE OF CONTROL AGREEMENT

The following
table contains a list of our officers who are party to the Change of Control
Agreement.  This agreement supersedes and
replaces the previous change of control agreement, if any, between the Company
and the officer.  As shown below, the
only terms of the agreement which differ are (1) the multiple of salary and
bonus to be paid by the Company as provided in Section 4(iii)(B), and (2) the
period of time for which benefits will be payable as provided in Sections 4(iv)
and (v).

	
  Name

  	
   

  	
  Execution Date

  	
   

  	
  Salary/Bonus Multiple

  (Section 4(iii)(B))

  	
   

  	
  Benefit Period

  (Section 4(iv) and (v))

  	
   

  
	
  Jeffrey
  Clevenger

  	
   

  	
  September
  25, 2006

  	
   

  	
  Three

  	
   

  	
  Thirty-Six
  Months

  	
   

  
	
  Alan Edwards

  	
   

  	
  September
  25, 2006

  	
   

  	
  Three

  	
   

  	
  Thirty-Six
  Months

  	
   

  
	
  Robert Blakestad

  	
   

  	
  September
  25, 2006

  	
   

  	
  Two

  	
   

  	
  Twenty-Four
  Months

  	
   

  
	
  Jerry Danni

  	
   

  	
  September
  25, 2006

  	
   

  	
  Two

  	
   

  	
  Twenty-Four
  Months

  	
   

  
	
  Marcel DeGuire

  	
   

  	
  September
  25, 2006

  	
   

  	
  Two

  	
   

  	
  Twenty-Four
  Months

  	
   

  
	
  Igor Levental

  	
   

  	
  September
  25, 2006

  	
   

  	
  Two

  	
   

  	
  Twenty-Four
  Months

  	
   

  
	
  Gerald Malys

  	
   

  	
  September
  25, 2006

  	
   

  	
  Two

  	
   

  	
  Twenty-Four
  Months

  	
   

  
	
  Terry Owen

  	
   

  	
  September
  25, 2006

  	
   

  	
  Two

  	
   

  	
  Twenty-Four
  Months

  	
   

  
	
  Donald Ratcliff

  	
   

  	
  November
  1, 2006

  	
   

  	
  Two

  	
   

  	
  Twenty-Four
  Months

  	
   

  
	
  Robert Vogels

  	
   

  	
  September 25, 2006

  	
   

  	
  Two

  	
   

  	
  Twenty-Four Months

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00112-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00112-of-00352.parquet"}]]