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DOE RUN RESOURCES CORP
·
10-K
Jun 2, 2:41 PM ET
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DOE RUN RESOURCES CORP 10-K
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Contents
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CLAUSE ONE: DEFINITIONS
1.1. Except if expressly stated herein or if required by the context, the terms used in this Global and Floating Pledge Agreement whose first letter is a capital letter shall have the meaning established in this clause:
1.2. Any terms starting with a capital letter, which are not expressly defined herein shall have the definition assigned thereto in the Credit Line Agreement stipulated in Sub-clause 1.1. above.
CLAUSE TWO: BACKGROUND
2.1. On April 3, 2002, DRP requested the Banks, through the AGENT, and the latter agreed to grant a Credit Line up to the amount of US$ 58,000,000.00 (FIFTY-EIGHT MILLION AND 00/100 US DOLLARS), as per the maximum amounts assumed by each Bank by virtue of its respective commitment, in accordance with the provisions set forth in Exhibit 1 of the Credit Line Agreement signed in September 17, 2002.
CLAUSE THREE: OBJECT
CLAUSE FOUR: SECURED OBLIGATIONS
CLAUSE FIVE: DRP’s OBLIGATIONS
5.1. Keep a detailed inventory of the property described in Exhibit I or of the property that substitute it pursuant to the provisions set forth in this Agreement;
5.2. Report on any impairment suffered by the pledged property, having the obligation to immediately substitute it pursuant to the provisions set forth in this Agreement;
5.3. Report on a monthly basis to the AGENT on any substitutions made to the pledged property during the relevant period, pursuant to what is expressly permitted by this Agreement;
5.4. Obtain the prior written consent of all the Banks before establishing any new pledges over other fungible property of the same nature as that encumbered hereby; except for the Authorized Liens;
5.5. Surrender, immediately and upon simple request by the AGENT, the pledged property, or its substitute, or its cash value, as may be agreed to herein; in the case that the guarantee is executed according to the provisions set forth in Clause Twelve hereof.
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5.6. Both parties hereby declare and recognize that the obligation provided in Clause 10 of Article 7 of Banking and Insurance Resolution No. 430-97, is aimed at guaranteeing the AGENT the replacement of the pledged property or of its value in money in the event of disposal, theft, deterioration or impairment of the same due to similar situations.
5.7. Keep an independent set of books for the property pledged in favor of the AGENT, separate from any other property which may have been pledged in favor of other creditors;
5.8. Allow the AGENT or whomever it designates, which designation should be timely communicated to DRP, to verify and/or supervise any activities relating to the pledged property, as well as the process of incorporation of other property with a higher asset value, pursuant to the provisions set forth in Clause Eleven, Subclause 11.5 of the Credit Line Agreement;
5.9. Permit and facilitate access to any persons designated by the AGENT, which designation should be timely communicated to DRP, to the place where the pledged property is kept, with the purpose of verifying its presence and condition, pursuant to the provisions set forth in Clause Eleven, Subclause 11.5 of the Credit Line Agreement;
5.10. Provide all the facilities needed for the execution of the pledged property, reimbursing any expenses incurred in the process, pursuant to the provisions set forth in Clause Twelve;
5.11. Notify the AGENT on a timely basis, of any acts which may affect the demandability, rank or the minimum value referred to in Exhibit III to the Global and Floating Pledge;
5.12. Not carry out or omit any actions which, as a result, may cause damages to the Global and Floating Pledge, or affect or impede its execution;
5.13. Amend through public deed, every time the AGENT may reasonably deem it necessary, Exhibit I, which forms an integral part of the Agreement, so that the stipulations of the said Exhibit agree with the DRP inventory. All expenses incurred in performing such amendment and the corresponding conversion to a public deed and registration in the relevant Public Registry, will be in the account of DRP.
CLAUSE SIX: THE DEPOSITARY
CLAUSE SEVEN: SCOPE OF PLEDGE
CLAUSE EIGHT: VALUE OF PLEDGE
CLAUSE NINE: INSURANCE
CLAUSE TEN: SUBSTITUTION OF PLEDGE
10.1. If the value of the property subject matter of the pledge referred to in Exhibit III goes down, in the opinion of the AGENT, whether because of its impairment, its market value or any other reason; or if, due to any causes, it is lost or damaged, DRP hereby binds itself, upon the simple request of the AGENT, to improve or substitute the pledge to the latter’s satisfaction; or else, to lower the amount of the obligation to the amount indicated by the AGENT.
10.2. In the case of failure in meeting such obligations within a prudential and reasonable term fixed by the AGENT, provided the Banks’ Majority so requests it, the AGENT will be entitled to automatically terminate the Credit Line Agreement guaranteeing this pledge, being clear that all terms set forth in favor of the debtor will be rendered as matured, without the need to follow any formalities or serve any notices to this effect whatsoever, in accordance with the provisions of Article 1430 of the Civil Code; with the AGENT being entitled to go on with the execution or sale of the pledge, pursuant to the stipulations contained in Clause Eleven of the Agreement, if the debtor does not pay off the Secured Obligations.
10.3. For the purposes of the determination of the value of the property subject of the Global and Floating Pledge, the AGENT, provided the Banks’ Majority so requests it, will carry out up to two annual appraisals of such property, which shall be carried out at the same time the inspections regarding the quality of DRP inventories will be made by
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the AGENT, pursuant to the provisions set forth in Clause Eleven, Subclause 11.5 of the Credit Line Agreement. Such appraisals will be entrusted to a firm specializing on the matter and all expenses incurred will be in the account of DRP.
CLAUSE ELEVEN: GROUNDS FOR THE EXECUTION OF THE PLEDGE
CLAUSE TWELVE: EXECUTION OF PLEDGE
12.1. Execute and sell all or part of the Global and Floating Pledge without the need of prior legal proceedings, as stipulated in Article 1069 of the Civil Code, offering it for sale in a manner which is reasonable from the business point of view in a market where property such as that comprising the Global and Floating Pledge is normally traded in the place or places which the AGENT may consider most appropriate, through public or private offerings, serving notarial notice on DRP at least fifteen (15) days in advance, indicating the date and place when the corresponding sale will occur and the need of its immediate delivery to the buyer of such property. In this case, the AGENT shall be empowered to hire a specialized company to carry out the execution and sale of the property comprising the Global and Floating Pledge. The expenses incurred as a consequence of the hiring of such company will be assumed by DRP.
12.2. Alternatively, in accordance with Article 1069 of the Civil Code, request a partial or full auction of the Global and Floating Pledge through execution of guaranties proceedings filed with a competent court and subject to the execution of guaranties rules prescribed in the Civil Procedural Code.
12.3. DRP hereby waives its right to file any claims against the AGENT on the grounds that the price obtained in the out-of-court sale of the Global and Floating Pledge or of any part thereof (even in the case of a private sale) were lower than the sale price which
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could have been obtained under a different sale procedure; and it declares that it knows and accepts the fact that the sale will be done without a base price, to the highest bidder, without the need of a prior appraisal, unless the AGENT otherwise instructs.
12.4. DRP must surrender and make available to the AGENT all the existing Global and Floating Pledge, in the manner and time required by the latter. If DRP fails to surrender to the AGENT or to make available the entire Global and Floating Pledge within the term established thereby, the AGENT may request the Judge to order DRP to surrender such Global and Floating Pledge and/or file criminal charges against THE DEPOSITARY for the illegal taking crime, without prejudice to any prevailing civil liabilities.
12.5. As a result of the execution of the pledge, the first item to be paid relates to the expenses incurred in the execution of the aforementioned proceedings, with the balance being directly assigned in favor of the AGENT so as to consider the Secured Obligations as having been paid off. If there would be a positive balance after having fulfilled all the Secured Obligations, it shall be returned to DRP.
CLAUSE THIRTEEN: REDUCTION OF THE PLEDGE AMOUNT
CLAUSE FOURTEEN: AMENDMENTS TO THE TERMS OF THE AGREEMENT
CLAUSE FIFTEEN: EXPENSES AND COSTS
CLAUSE SIXTEEN: NOTICES
CLAUSE SEVENTEEN: RELEASE OF PLEDGE
CLAUSE EIGHTEEN: ROLE OF THE AGENT
CLAUSE NINETEEN: GOVERNING LEGISLATION
CLAUSE TWENTY: ARBITRATION
20.1. The parties hereby expressly agree that any conflict or controversy which may arise between them as a result of the interpretation or execution of this Agreement, including those related to its being null and void or invalid, shall be resolved by means of a de jure arbitration entrusted to an Arbitration Court made up of three members who must necessarily be attorneys at law registered in the Bar Association, to be held in accordance with the National and International Conciliation and Arbitration Regulation of the Chamber of Commerce of Lima.
20.2. The Arbitration Court will be formed in the following manner: each one of the parties shall designate one arbitrator and the third arbitrator shall be designated by mutual agreement by the first two arbitrators, who will be the Chairman of the Arbitration Court.
20.3. The arbitration shall be held in the City of Lima and the duration of the same may not exceed sixty (60) business days counted as from the date of installation of the Arbitration Court until such time as the respective award is issued.
20.4. The Arbitration Award shall be final and cannot be appealed.
20.5. The losing party shall assume the costs incurred in the arbitration proceedings.
20.6. Should any of the parties decide to file an appeal with the Judiciary calling for the annulment of the arbitration award, it must first make arrangements for a Bank Letter of Guaranty granted by a top-rated Bank headquartered in Lima, equivalent to US$ 50,000.00 (FIFTY THOUSAND AND 00/1 00 US DOLLARS), which can be executed in the event that the appeal is declared groundless in a final ruling. This Bank Letter of Guaranty must be in force during the time the aforementioned process is underway.
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