FORM OF FIRST SUPPLEMENTAL INDENTURE
among
[INSERT FULL LEGAL NAME OF NEW GUARANTOR] as New Guarantor,
TORCHLIGHT MINING CORP. as Issuer,
the existing Guarantors party hereto,
and
NORTHERN DOMINION TRUST COMPANY as Trustee and Collateral Agent
Supplemental to the Indenture dated as of April 19, 2022
relating to the
8.750% Senior Secured Notes due 2029
THIS FORM IS ATTACHED AS EXHIBIT [●] TO THE INDENTURE
FIRST SUPPLEMENTAL INDENTURE
This FIRST SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of [●], 20[●], is entered into among [INSERT FULL LEGAL NAME OF NEW GUARANTOR], a [insert entity type — e.g., corporation, limited liability company, unlimited liability company, partnership] organized under the laws of [insert jurisdiction of organization] (the "New Guarantor"), TORCHLIGHT MINING CORP., a corporation incorporated under the Canada Business Corporations Act (the "Issuer"), WOLVERINE LAKE MINING LTD., an Ontario corporation, TORCHLIGHT MILLING & PROCESSING INC., an Ontario corporation, and TORCHLIGHT U.S. HOLDINGS, INC., a Delaware corporation (each, an "Existing Guarantor" and, collectively, the "Existing Guarantors"), and NORTHERN DOMINION TRUST COMPANY, a national banking association, as trustee (in such capacity, the "Trustee") and as collateral agent (in such capacity, the "Collateral Agent").
RECITALS
WHEREAS:
A. The Issuer, the Existing Guarantors, and the Trustee entered into that certain Indenture dated as of April 19, 2022 (as amended, supplemented, or otherwise modified from time to time prior to the date hereof, the "Base Indenture"), among Torchlight Mining Corp., a corporation incorporated under the Canada Business Corporations Act, as issuer, Wolverine Lake Mining Ltd., an Ontario corporation, Torchlight Milling & Processing Inc., an Ontario corporation, and Torchlight U.S. Holdings, Inc., a Delaware corporation, as guarantors, and Northern Dominion Trust Company, a national banking association, as Trustee, Paying Agent, Transfer Agent, Registrar, and Collateral Agent, pursuant to which the Issuer issued $300,000,000 in aggregate principal amount of its 8.750% Senior Secured Notes due 2029 (the "Notes"), bearing CUSIP No. 891207 AA 3 (144A) and CUSIP No. C89120 AA 5 (Regulation S).
B. Section [●] of the Base Indenture provides that each Subsidiary of the Issuer that, after the Issue Date (as defined in the Base Indenture), has total assets (determined in accordance with generally accepted accounting principles as in effect in Canada or the United States, as applicable ("GAAP")) equal to or exceeding $5,000,000, shall execute and deliver to the Trustee a supplemental indenture pursuant to which such Subsidiary shall unconditionally guarantee, on a senior secured basis, jointly and severally with the Existing Guarantors and any other Guarantors from time to time party to the Base Indenture, the full and punctual payment and performance of all of the Issuer's obligations under the Notes and the Base Indenture (such guarantee, in the case of each Guarantor, a "Guarantee").
C. [Insert full legal name of New Guarantor] (the "New Guarantor") is a [insert entity type — e.g., corporation, limited liability company, unlimited liability company, partnership] duly organized and validly existing under the laws of [insert jurisdiction of organization]. The New Guarantor is a direct [or indirect] wholly owned Subsidiary of the Issuer. As of [insert date of most recent determination], the New Guarantor had total assets (determined in accordance with GAAP) equal to or exceeding $5,000,000, thereby triggering the requirement under Section [●] of the Base Indenture that the New Guarantor execute and deliver this Supplemental Indenture and become a Guarantor under the Base Indenture.
D. The execution and delivery of this Supplemental Indenture, and the performance by the New Guarantor of its obligations hereunder, have been duly authorized by all necessary corporate or other organizational action on the part of the New Guarantor, and the execution and delivery of this Supplemental Indenture by the Issuer and the Trustee have been duly authorized by all necessary corporate or other organizational action on the part of the Issuer and the Trustee, respectively. Section [●] of the Base Indenture expressly authorizes the Issuer and the Trustee to execute and deliver supplemental indentures, without the consent of the Holders of the Notes, for the purpose of, among other things, adding Guarantors under the Base Indenture and the Notes.
E. All conditions precedent set forth in the Base Indenture for the execution and delivery of this Supplemental Indenture, and for the joinder of the New Guarantor as a Guarantor thereunder, have been duly satisfied. In connection herewith, the Issuer and/or the New Guarantor are delivering to the Trustee, concurrently with the execution and delivery of this Supplemental Indenture, the Officer's Certificate and the Opinion of Counsel required to be delivered to the Trustee pursuant to Section [●] of the Base Indenture, each in form and substance reasonably satisfactory to the Trustee.
NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.01 *Definitions.*
Capitalized terms used but not otherwise defined in this Supplemental Indenture shall have the respective meanings ascribed to such terms in the Base Indenture. In addition, the following terms shall have the meanings set forth below when used in this Supplemental Indenture:
"Base Indenture" means the Indenture dated as of April 19, 2022, among the Issuer, the Existing Guarantors, and the Trustee, as the same may be amended, restated, supplemented, or otherwise modified from time to time (other than by this Supplemental Indenture).
"New Guarantor" means [Insert full legal name of New Guarantor], a [insert entity type] organized under the laws of [insert jurisdiction of organization], and its successors and permitted assigns.
"Security Documents" means, collectively, (a) the Security Agreement (or joinder thereto), (b) the General Security Agreement (or joinder thereto), (c) the Collateral Agency Agreement (or joinder thereto), and (d) any and all other agreements, instruments, financing statements, and documents now or hereafter executed and delivered to the Collateral Agent granting or perfecting a security interest in the assets of the New Guarantor for the benefit of the Holders of the Notes, in each case, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
"Supplemental Indenture" means this First Supplemental Indenture dated as of [insert date], among the New Guarantor, the Issuer, the Existing Guarantors, and the Trustee.
Section 1.02 *Rules of Construction.*
The rules of construction set forth in Section [●] of the Base Indenture shall apply to this Supplemental Indenture mutatis mutandis and are incorporated herein by reference as if set forth in full. Without limiting the generality of the foregoing, (a) references herein to any "Section" or "Article" refer to a Section or Article of this Supplemental Indenture unless the context otherwise requires, (b) the words "herein," "hereof," and "hereunder" and words of similar import refer to this Supplemental Indenture as a whole and not to any particular provision hereof, and (c) references to "this Indenture" in the Base Indenture shall, from and after the date hereof, be deemed to include this Supplemental Indenture unless the context otherwise requires. The headings of Articles and Sections in this Supplemental Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.
ARTICLE II
AGREEMENT TO GUARANTEE; JOINDER
Section 2.01 *Guarantee.*
The New Guarantor hereby agrees, jointly and severally with each of the Existing Guarantors and with any other Person that may hereafter become a Guarantor under the Base Indenture, to unconditionally guarantee to each Holder of a Note authenticated and delivered under the Base Indenture and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Base Indenture, the Notes, or the obligations of the Issuer thereunder, the full and punctual payment and performance of the Guaranteed Obligations (as defined in the Base Indenture).
The Guarantee of the New Guarantor hereunder shall constitute a senior secured obligation of the New Guarantor, ranking pari passu in right of payment with all existing and future senior Indebtedness of the New Guarantor (including, without limitation, any obligations under the New Guarantor's guarantees of Indebtedness under any Credit Facility (as defined in the Base Indenture) or other first-lien obligations), and senior in right of payment to all existing and future subordinated Indebtedness of the New Guarantor.
The Guarantee shall be secured by a first-priority lien (subject only to Permitted Liens as defined in the Base Indenture) on substantially all tangible and intangible assets of the New Guarantor, to be granted pursuant to the Security Documents executed and delivered by the New Guarantor concurrently herewith or promptly thereafter in accordance with Article III of this Supplemental Indenture.
Section 2.02 *Terms of the Guarantee.*
The Guarantee of the New Guarantor shall be subject to and governed by all of the terms and conditions applicable to Guarantees set forth in Article [●] of the Base Indenture, all of which terms and conditions are incorporated herein by reference as though set forth in full. Without limiting the generality of the foregoing, the Guarantee shall include, and the New Guarantor hereby agrees to be bound by, the following provisions:
(a) Guaranteed Obligations. The New Guarantor unconditionally guarantees the full and punctual payment and performance when due, whether at the stated maturity date of April 15, 2029, or upon acceleration, redemption, repurchase, or otherwise, of all obligations of the Issuer under the Notes and the Base Indenture, including (without limitation) all obligations in respect of the principal of and premium, if any, and interest (including any interest accruing after the commencement of any bankruptcy, insolvency, or similar proceeding, whether or not such interest is an allowed claim in such proceeding) on the Notes and all other amounts payable by the Issuer under the Base Indenture and the Notes.
(b) Waiver. The New Guarantor hereby waives, to the fullest extent permitted by applicable law, (i) notice of acceptance of the Guarantee, (ii) presentment, demand for payment, protest, and notice of dishonor or non-payment in respect of the Guaranteed Obligations, (iii) any requirement that the Trustee, the Collateral Agent, or any Holder exhaust any right or remedy or take any action against the Issuer or any other Guarantor or any collateral before enforcing the Guarantee, (iv) any right to require the marshalling of assets of the Issuer or any other Guarantor, and (v) any defense arising by reason of the incapacity, lack of authority, or any disability or other defense of the Issuer or any other Guarantor, including any defense based on or arising out of the lack of validity or the unenforceability of the Guaranteed Obligations or any agreement or instrument relating thereto, or by reason of the cessation of the liability of the Issuer from any cause other than payment in full of the Guaranteed Obligations.
(c) Subrogation. Until the Guaranteed Obligations have been indefeasibly paid in full in cash, the New Guarantor shall not exercise any right of subrogation, contribution, reimbursement, indemnification, or other right or remedy against the Issuer or any other Guarantor in respect of the Guaranteed Obligations, and the New Guarantor hereby subordinates any such rights to the prior indefeasible payment in full in cash of all Guaranteed Obligations.
(d) Contribution. To the extent that any payment is made by the New Guarantor under the Guarantee, the New Guarantor shall be entitled to contribution from any other Guarantor in accordance with the provisions of Article [●] of the Base Indenture governing contribution among Guarantors.
Section 2.03 *Limitation on Guarantee.*
Notwithstanding anything to the contrary in this Supplemental Indenture or the Base Indenture, the obligations of the New Guarantor under the Guarantee shall be limited to the maximum amount that would not render the Guarantee void, voidable, or unenforceable under any applicable fraudulent transfer, fraudulent conveyance, or similar laws (including, without limitation, Title 11 of the United States Code, the Uniform Fraudulent Transfer Act, the Uniform Voidable Transactions Act, any state fraudulent conveyance or transfer statute, the Bankruptcy and Insolvency Act (Canada), the Companies' Creditors Arrangement Act (Canada), and any analogous provisions under the laws of the jurisdiction of organization of the New Guarantor). In furtherance of the foregoing, and without limiting the generality thereof, the aggregate liability of the New Guarantor under the Guarantee shall be limited to the largest amount that, after giving effect to all other contingent and fixed liabilities of the New Guarantor, and after giving effect to any collection from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under the Base Indenture, would not cause the New Guarantor to become insolvent or result in the Guarantee being avoidable under the foregoing laws.
[Insert if the New Guarantor is organized in a jurisdiction requiring additional limitation language, e.g., Canadian provincial limitations, Delaware LLC limitations, etc.:
[Additional jurisdiction-specific limitation language to be inserted here.]
]
Section 2.04 *Release of New Guarantor.*
The Guarantee of the New Guarantor shall be automatically and unconditionally released, and the New Guarantor shall be discharged from all obligations thereunder, in accordance with and subject to the provisions set forth in Section [●] of the Base Indenture, including, without limitation, upon the occurrence of any of the following events:
(a) the sale, exchange, disposition, or other transfer (including by way of merger, amalgamation, or consolidation) of the Capital Stock or all or substantially all of the assets of the New Guarantor (other than to the Issuer or a Restricted Subsidiary) in a transaction that is in compliance with the provisions of the Base Indenture governing asset sales and, if applicable, mergers and consolidations;
(b) the designation of the New Guarantor as an Unrestricted Subsidiary in accordance with the provisions of the Base Indenture;
(c) the legal defeasance or covenant defeasance of the Notes in accordance with the applicable provisions of the Base Indenture;
(d) the discharge of the Issuer's obligations under the Base Indenture in accordance with the applicable provisions thereof; or
(e) the occurrence of any other event or circumstance that results in the automatic release of the Guarantee pursuant to the express terms of the Base Indenture.
Upon any such release, the Trustee shall, at the request and expense of the Issuer, execute and deliver any instruments or documents reasonably requested by the Issuer or the New Guarantor to evidence or confirm such release, and the Collateral Agent shall take such actions as may be reasonably requested to release the Liens on the assets of the New Guarantor granted pursuant to the Security Documents.
ARTICLE III
SECURITY
Section 3.01 *Grant of Security Interest.*
Concurrently with the execution and delivery of this Supplemental Indenture, or as promptly as practicable thereafter (and, in any event, within the time periods specified in the Base Indenture and the Collateral Agency Agreement), the New Guarantor shall execute and deliver the Security Documents described below, as applicable:
(a) If the New Guarantor is organized under the laws of a U.S. jurisdiction: A joinder agreement (in substantially the form attached hereto as Schedule A) to the Security Agreement dated as of April 19, 2022 (as amended, supplemented, or otherwise modified from time to time, the "U.S. Security Agreement"), between Torchlight U.S. Holdings, Inc. and Northern Dominion Trust Company, as Collateral Agent, or, if a joinder is not practicable, a separate security agreement in substantially the same form as the U.S. Security Agreement, pursuant to which the New Guarantor shall grant to the Collateral Agent, for the benefit of the Holders of the Notes and the Trustee, a first-priority security interest (subject only to Permitted Liens) in substantially all of its assets, including, without limitation, all accounts receivable, inventory, equipment, general intangibles, intellectual property, intercompany notes, chattel paper, instruments, deposit accounts, investment property, letter-of-credit rights, commercial tort claims, equity interests in Subsidiaries (if any), and all proceeds and products thereof.
(b) If the New Guarantor is organized under the laws of a Canadian jurisdiction: A joinder agreement (in substantially the form attached hereto as Schedule B) to the General Security Agreement dated as of April 19, 2022 (as amended, supplemented, or otherwise modified from time to time, the "Canadian General Security Agreement"), among Torchlight Mining Corp., Wolverine Lake Mining Ltd., Torchlight Milling & Processing Inc., and Northern Dominion Trust Company, as Collateral Agent, or, if a joinder is not practicable, a separate general security agreement in substantially the same form as the Canadian General Security Agreement, pursuant to which the New Guarantor shall grant to the Collateral Agent, for the benefit of the Holders of the Notes and the Trustee, a first-priority lien and security interest (subject only to Permitted Liens) in substantially all of its tangible and intangible personal property, including, without limitation, all accounts, inventory, equipment, intangibles, instruments, securities, money, and all proceeds and products thereof.
(c) Additional Jurisdiction-Specific Documents: [Insert any additional jurisdiction-specific security documents as may be required, including, without limitation, mining-rights-specific pledge agreements, real property mortgages or deeds of trust, intellectual property security agreements, or other security documents necessary or advisable to grant and perfect a first-priority Lien on the assets of the New Guarantor in favor of the Collateral Agent for the benefit of the Holders and the Trustee.]
Section 3.02 *Joinder to Collateral Agency Agreement.*
Concurrently with the execution and delivery of this Supplemental Indenture, or as promptly as practicable thereafter, the New Guarantor shall execute and deliver a joinder agreement (in substantially the form attached hereto as Schedule C) to the Collateral Agency Agreement dated as of April 19, 2022 (as amended, supplemented, or otherwise modified from time to time, the "Collateral Agency Agreement"), among the Issuer, the Existing Guarantors, and Northern Dominion Trust Company, as Collateral Agent. From and after the effective date of such joinder, the New Guarantor shall be bound by all of the terms, conditions, covenants, and obligations of the Collateral Agency Agreement as if the New Guarantor had been an original party thereto, and the New Guarantor shall have all of the rights and benefits available to the "Grantors" (or similarly defined term) thereunder.
Section 3.03 *Perfection; Further Assurances.*
The New Guarantor shall take all actions necessary or reasonably requested by the Trustee or the Collateral Agent to perfect the security interests granted pursuant to this Article III and the Security Documents and to ensure that such security interests constitute first-priority Liens (subject only to Permitted Liens), including, without limitation:
(a) UCC / PPSA Filings. If the New Guarantor is organized under the laws of a U.S. jurisdiction, the filing of UCC-1 financing statements (and any continuation statements or amendments thereto) in each filing office in which such filings are required or advisable to perfect the security interests granted pursuant to the U.S. Security Agreement or the applicable joinder thereto. If the New Guarantor is organized under the laws of a Canadian province or territory, the filing of registrations under the applicable Personal Property Security Act (or equivalent legislation, including the Civil Code of Québec, if applicable) in each registry in which such registrations are required or advisable to perfect the security interests granted pursuant to the Canadian General Security Agreement or the applicable joinder thereto.
(b) Delivery of Certificates. The delivery to the Collateral Agent of all certificated securities (including, without limitation, any stock certificates, membership interest certificates, or partnership interest certificates) owned by the New Guarantor, together with duly executed stock powers or transfer instruments in blank, to the extent required by the applicable Security Documents.
(c) Mining-Rights Registrations. The execution and delivery of any mining-rights-specific registrations, filings, notices, or other documents required under applicable mining legislation (including, without limitation, filings with the applicable mining recorder's office or equivalent governmental authority) to create, perfect, protect, or preserve the Collateral Agent's Lien on any mining claims, mining leases, mineral rights, or other mining-related assets of the New Guarantor.
(d) Deposit Account Control Agreements. The execution and delivery of deposit account control agreements (or similar arrangements under applicable law) with respect to each deposit account maintained by the New Guarantor, to the extent required by the applicable Security Documents.
(e) Other Actions. The taking of such other actions and the execution and delivery of such other documents and instruments as the Trustee or the Collateral Agent may reasonably request from time to time in order to carry out the purposes of this Article III and the Security Documents, including, without limitation, the execution of mortgages, deeds of trust, or other real property security instruments with respect to any real property owned or leased by the New Guarantor, to the extent required by the Base Indenture.
[Insert any additional perfection steps required for the specific jurisdiction and asset types of the New Guarantor.]
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE NEW GUARANTOR
The New Guarantor hereby represents and warrants to each of the other parties hereto, as of the date of this Supplemental Indenture, as follows:
Section 4.01 *Organization and Good Standing.*
The New Guarantor is a [insert entity type] duly organized, validly existing, and in good standing (or the equivalent thereof, where such concept is recognized) under the laws of [insert jurisdiction of organization]. The New Guarantor has all requisite corporate (or equivalent) power and authority to own or lease its properties and to conduct its business as presently conducted. The New Guarantor is duly qualified or licensed to do business and is in good standing (or the equivalent thereof, where such concept is recognized) in each jurisdiction in which the character of its properties or the nature of its business makes such qualification or licensing necessary, except where the failure to be so qualified or licensed, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect (as defined in the Base Indenture).
Section 4.02 *Power and Authority.*
The New Guarantor has the corporate (or equivalent) power and authority to execute, deliver, and perform its obligations under this Supplemental Indenture, the Guarantee, and each of the related Security Documents to which it is or will be a party.
Section 4.03 *Due Authorization.*
The execution, delivery, and performance by the New Guarantor of this Supplemental Indenture, the Guarantee, and each of the related Security Documents to which it is or will be a party have been duly authorized by all necessary corporate (or equivalent) action on the part of the New Guarantor, and no further action or approval (including, without limitation, any approval of the shareholders, members, partners, or other equity holders of the New Guarantor) is required for such execution, delivery, and performance.
Section 4.04 *Enforceability.*
This Supplemental Indenture constitutes, and each of the related Security Documents to which the New Guarantor is or will be a party, when executed and delivered, will constitute, the legal, valid, and binding obligation of the New Guarantor, enforceable against the New Guarantor in accordance with its respective terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium, and similar laws affecting creditors' rights and remedies generally and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith, and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).
Section 4.05 *No Conflicts.*
The execution, delivery, and performance by the New Guarantor of this Supplemental Indenture, the Guarantee, and each of the related Security Documents to which it is or will be a party do not and will not: (a) violate, conflict with, or result in a breach of any provision of the articles of incorporation, bylaws, articles of organization, operating agreement, partnership agreement, or other organizational documents of the New Guarantor; (b) conflict with, result in a breach of, constitute a default (or an event that, with notice, lapse of time, or both, would constitute a default) under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under any material agreement, contract, lease, license, instrument, or other arrangement to which the New Guarantor is a party or by which the New Guarantor or any of its properties or assets is bound or affected; or (c) result in a violation by the New Guarantor of any applicable statute, law, rule, regulation, ordinance, code, order, judgment, writ, injunction, decree, or award of any governmental authority binding on the New Guarantor or any of its properties or assets.
Section 4.06 *Governmental Approvals.*
No governmental approval, authorization, consent, license, permit, order, or filing with or notice to any governmental authority is required for the execution, delivery, and performance by the New Guarantor of this Supplemental Indenture, the Guarantee, and each of the related Security Documents to which it is or will be a party, except for (a) filings and registrations necessary for the creation and perfection of the security interests granted pursuant to the Security Documents, including the filing of UCC-1 financing statements, PPSA registrations, or equivalent filings in the applicable jurisdictions, and (b) such other approvals, authorizations, consents, or filings as have already been obtained or made and are in full force and effect as of the date hereof.
ARTICLE V
COVENANTS OF THE NEW GUARANTOR
Section 5.01 *Assumption of Obligations Under Base Indenture.*
From and after the date hereof, the New Guarantor shall be bound by and shall comply with all covenants, agreements, restrictions, and obligations applicable to a "Guarantor" or "Subsidiary Guarantor" under the Base Indenture, as fully and to the same extent as if the New Guarantor had been an original signatory to the Base Indenture. Without limiting the generality of the foregoing, the New Guarantor acknowledges and agrees that it shall be bound by and shall comply with the following covenants and provisions of the Base Indenture:
(a) Limitation on Incurrence of Indebtedness. The New Guarantor shall not incur any Indebtedness except in compliance with Section [●] of the Base Indenture, including the requirement that the Issuer's Consolidated Leverage Ratio (as defined in the Base Indenture) shall not exceed 3.75 to 1.00 on a pro forma basis after giving effect to the incurrence of such additional Indebtedness (and the application of the proceeds thereof), subject to the exceptions and Permitted Indebtedness baskets set forth therein.
(b) Limitation on Restricted Payments. The New Guarantor shall not make any Restricted Payment except in compliance with Section [●] of the Base Indenture, including compliance with the cumulative builder basket (starting at $25,000,000 as of the Issue Date) and the Restricted Payments ratio cap (pro forma Consolidated Leverage Ratio not to exceed 3.00 to 1.00 after giving effect to such Restricted Payment), subject to the exceptions set forth therein.
(c) Limitation on Asset Sales. The New Guarantor shall not consummate any Asset Sale except in compliance with Section [●] of the Base Indenture, including the requirements that (i) the consideration received is at least equal to the fair market value of the assets sold or disposed of (as determined in good faith by the Board of Directors of the Issuer), (ii) at least 75% of such consideration consists of cash or Cash Equivalents or Replacement Assets (as each such term is defined in the Base Indenture), and (iii) any Net Proceeds from such Asset Sale are applied or invested within 365 days in accordance with the provisions of the Base Indenture.
(d) Limitation on Liens. The New Guarantor shall not create, incur, assume, or suffer to exist any Lien on any of its properties or assets, except for Permitted Liens, in compliance with Section [●] of the Base Indenture.
(e) Change of Control. In the event of a Change of Control (as defined in the Base Indenture), the New Guarantor acknowledges that the Issuer shall be obligated to offer to repurchase the Notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest to (but not including) the date of repurchase, and the New Guarantor's Guarantee shall remain in full force and effect until such repurchase is consummated or the Notes are otherwise paid in full.
(f) Reporting Obligations. The New Guarantor shall cooperate with and assist the Issuer in complying with the reporting obligations set forth in Section [●] of the Base Indenture, including the delivery of annual financial information within 90 days after the end of each fiscal year and quarterly financial information within 45 days after the end of each of the first three fiscal quarters of each fiscal year.
(g) Other Covenants. All other covenants, agreements, restrictions, and obligations applicable to Guarantors under the Base Indenture, including, without limitation, the covenant regarding transactions with Affiliates, the covenant regarding the payment of taxes, the covenant regarding maintenance of properties and insurance, the covenant regarding compliance with laws, and the covenant regarding the provision of additional guarantees and security.
Section 5.02 *Delivery of Documents.*
Concurrently with the execution and delivery of this Supplemental Indenture, or as otherwise required by the Base Indenture, the New Guarantor and/or the Issuer shall deliver, or cause to be delivered, to the Trustee each of the following documents, in form and substance reasonably satisfactory to the Trustee:
(a) An Officer's Certificate (in substantially the form attached hereto as Schedule D), executed by a duly authorized officer of the Issuer and/or the New Guarantor, certifying that (i) all conditions precedent under the Base Indenture to the execution and delivery of this Supplemental Indenture and to the New Guarantor becoming a Guarantor thereunder have been satisfied, (ii) the total assets of the New Guarantor equal or exceed $5,000,000, (iii) no Event of Default exists under the Base Indenture, or would result from the execution and delivery of this Supplemental Indenture, and (iv) this Supplemental Indenture complies in all respects with the requirements of the Base Indenture.
(b) An Opinion of Counsel (which may be from internal or external counsel to the Issuer and/or the New Guarantor), addressed to the Trustee, in form and substance reasonably satisfactory to the Trustee, opining as to (i) the due organization and valid existence of the New Guarantor under the laws of its jurisdiction of organization, (ii) the corporate (or equivalent) power and authority of the New Guarantor to execute, deliver, and perform its obligations under this Supplemental Indenture, the Guarantee, and the Security Documents, (iii) the due authorization and execution of this Supplemental Indenture, the Guarantee, and the Security Documents by the New Guarantor, (iv) the enforceability of this Supplemental Indenture, the Guarantee, and the Security Documents against the New Guarantor (subject to customary exceptions and qualifications), and (v) such other matters as the Trustee may reasonably request.
(c) Certified copies of resolutions of the board of directors (or equivalent governing body) of the New Guarantor authorizing the execution, delivery, and performance of this Supplemental Indenture, the Guarantee, and the Security Documents.
(d) A certificate of good standing (or equivalent document, such as a certificate of compliance, certificate of status, or similar certificate) from the relevant governmental authority in the jurisdiction of organization of the New Guarantor, dated within thirty (30) days of the date hereof.
(e) An incumbency certificate, executed by the secretary or an assistant secretary (or equivalent officer) of the New Guarantor, identifying the names, titles, and specimen signatures of the officers of the New Guarantor authorized to execute this Supplemental Indenture, the Guarantee, and the Security Documents on behalf of the New Guarantor.
(f) Executed originals (or executed copies, to the extent originals are not available) of each Security Document to which the New Guarantor is or will be a party, including, as applicable, the joinder to the U.S. Security Agreement, the joinder to the Canadian General Security Agreement, and the joinder to the Collateral Agency Agreement, together with evidence of the filing or registration of all financing statements and other documents necessary to perfect the security interests granted thereby.
(g) [Insert any additional documents required by the Base Indenture, the Collateral Agency Agreement, or the Security Documents, including, without limitation, surveys, title insurance commitments, environmental reports, or other documents with respect to real property collateral.]
ARTICLE VI
MISCELLANEOUS
Section 6.01 *Effect of Supplemental Indenture.*
Except as expressly amended, supplemented, or otherwise modified by this Supplemental Indenture, the Base Indenture shall remain in full force and effect and is hereby ratified and confirmed in all respects. From and after the date hereof, (a) all references in the Base Indenture to "Guarantors," "Subsidiary Guarantors," or words of similar import shall be deemed to include the New Guarantor, (b) the New Guarantor shall be deemed a "Guarantor" and a "Subsidiary Guarantor" for all purposes of the Base Indenture, the Notes, and the Security Documents, and (c) each reference in the Notes or any other Transaction Document (as defined in the Base Indenture) to the "Indenture" shall be deemed to be a reference to the Base Indenture as supplemented by this Supplemental Indenture. This Supplemental Indenture shall be read together with and shall be deemed a part of the Base Indenture for all purposes. In the event of any inconsistency or conflict between the provisions of this Supplemental Indenture and the provisions of the Base Indenture, the provisions of the Base Indenture shall govern and control.
Section 6.02 *Governing Law.*
THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW THEREOF (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW).
Section 6.03 *Jurisdiction; Waiver of Jury Trial.*
(a) Consent to Jurisdiction. Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the United States District Court for the Southern District of New York and any New York State court sitting in the Borough of Manhattan, City of New York (and any appellate court from any thereof), in any action or proceeding arising out of or relating to this Supplemental Indenture, the Guarantee, or the transactions contemplated hereby or thereby, or for recognition or enforcement of any judgment, and each of the parties hereto irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York Federal court or, to the fullest extent permitted by applicable law, in such New York State court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
(b) Waiver of Venue. Each of the parties hereto irrevocably and unconditionally waives, to the fullest extent permitted by applicable law, any objection that it may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to this Supplemental Indenture, the Guarantee, or the transactions contemplated hereby or thereby in any court referred to in paragraph (a) of this Section 6.03, and the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(c) Agent for Service of Process. [If the New Guarantor is organized under the laws of a jurisdiction outside the United States:] The New Guarantor hereby irrevocably appoints [Insert name and address of agent] as its agent to receive on its behalf service of copies of the summons and complaint and any other process which may be served in any such action or proceeding. Such service may be made by mailing or delivering a copy of such process to the New Guarantor in care of such agent at the agent's address specified above, and the New Guarantor hereby irrevocably authorizes and directs such agent to accept such service on its behalf. The New Guarantor agrees that a final judgment in any action or proceeding so served shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
(d) WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE 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 SUPPLEMENTAL INDENTURE, THE GUARANTEE, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT, OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS SUPPLEMENTAL INDENTURE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 6.03(d).
Section 6.04 *Notices.*
All notices, requests, demands, consents, instructions, and other communications required or permitted to be given to or made upon any party hereto shall be in writing and shall be deemed to have been duly given or made in accordance with the notice provisions set forth in Section [●] of the Base Indenture, which are incorporated herein by reference. For purposes of this Supplemental Indenture, notices shall be directed as follows:
If to the New Guarantor:
[Insert full legal name of New Guarantor] [Insert address] [Insert city, state/province, zip/postal code, country]
Attention: [Insert]
Facsimile: [Insert]
Email: [Insert]
If to the Issuer:
Torchlight Mining Corp. 2200 – 400 Burrard Street Vancouver, British Columbia V6C 3A6 Canada
Attention: General Counsel & Corporate Secretary
Facsimile: [Insert]
Email: [Insert]
If to the Trustee and Collateral Agent:
Northern Dominion Trust Company 101 Barclay Street, 7th Floor New York, NY 10286 United States
Attention: Corporate Trust Department (VP, Corporate Trust)
Facsimile: [Insert]
Email: [Insert]
Any party hereto may change its address for purposes of this Section 6.04 by giving written notice of such change to the other parties hereto in accordance with the provisions of this Section 6.04.
Section 6.05 *Successors and Assigns.*
This Supplemental Indenture shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors and assigns. The New Guarantor may not assign or transfer any of its rights or obligations under this Supplemental Indenture or the Guarantee, except in connection with a transaction permitted under the Base Indenture (including, without limitation, a merger, amalgamation, or consolidation in compliance with the applicable provisions thereof).
Section 6.06 *Severability.*
If any provision of this Supplemental Indenture is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions of this Supplemental Indenture shall not in any way be affected or impaired thereby. The parties hereto shall endeavor in good-faith negotiations to replace the invalid, illegal, or unenforceable provision with a valid, legal, and enforceable provision that, to the maximum extent practicable, achieves the economic, business, and other purposes of the invalid, illegal, or unenforceable provision.
Section 6.07 *Counterparts.*
This Supplemental Indenture may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or electronic transmission in portable document format ("PDF") (including any electronic signature complying with the U.S. federal ESIGN Act of 2000, the Uniform Electronic Transactions Act, or any applicable Canadian provincial electronic commerce legislation) shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or by PDF shall be deemed to be their original signatures for all purposes.
Section 6.08 *Trustee Disclaimer.*
Northern Dominion Trust Company hereby accepts and agrees to perform its obligations under this Supplemental Indenture upon the terms and conditions set forth herein and in the Base Indenture, including, without limitation, all of the provisions of the Base Indenture relating to the rights, privileges, protections, immunities, and indemnities of the Trustee in its capacity as Trustee and as Collateral Agent. The recitals contained herein are made by the Issuer and the New Guarantor only, and the Trustee assumes no responsibility for the correctness of any such recital. The Trustee makes no representations as to (a) the validity or sufficiency of this Supplemental Indenture (other than as to the due execution hereof by the Trustee), (b) the validity or sufficiency of the Guarantee, the Notes, or any other Transaction Document, (c) the status, condition, or financial position of the Issuer, the New Guarantor, or any other Guarantor, or (d) the satisfaction of any condition precedent to the effectiveness of this Supplemental Indenture or the Guarantee. The Trustee shall not be responsible for, and makes no representations or warranties concerning, the validity or sufficiency of the Security Documents or the priority of any Lien created thereby.
Section 6.09 *Entire Agreement.*
This Supplemental Indenture, together with the Base Indenture, the Notes, the Security Documents, the Collateral Agency Agreement, and the other Transaction Documents (as defined in the Base Indenture), constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior agreements, understandings, negotiations, and discussions, whether oral or written, of the parties hereto with respect thereto.
[Signature pages follow]
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first written above.
NEW GUARANTOR:
[INSERT FULL LEGAL NAME OF NEW GUARANTOR]
By: ________
Name: [Insert]
Title: [Insert]
ISSUER:
TORCHLIGHT MINING CORP.
By: ________
Name: [Insert]
Title: [Insert]
EXISTING GUARANTORS:
WOLVERINE LAKE MINING LTD.
By: ________
Name: [Insert]
Title: [Insert]
TORCHLIGHT MILLING & PROCESSING INC.
By: ________
Name: [Insert]
Title: [Insert]
TORCHLIGHT U.S. HOLDINGS, INC.
By: ________
Name: [Insert]
Title: [Insert]
TRUSTEE AND COLLATERAL AGENT:
NORTHERN DOMINION TRUST COMPANY, as Trustee and Collateral Agent
By: ________
Name: [Insert]
Title: [Insert]
SCHEDULE A
FORM OF JOINDER TO SECURITY AGREEMENT (U.S.)
This JOINDER TO SECURITY AGREEMENT (this "Joinder"), dated as of [●], 20[●], is executed and delivered by [INSERT FULL LEGAL NAME OF NEW GUARANTOR], a [insert entity type] organized under the laws of [insert U.S. jurisdiction] (the "New Grantor"), in favor of NORTHERN DOMINION TRUST COMPANY, a national banking association, in its capacity as collateral agent (the "Collateral Agent") for the benefit of the Secured Parties (as defined in the Security Agreement referenced below).
RECITALS
A. Reference is made to that certain Security Agreement dated as of April 19, 2022 (as amended, supplemented, or otherwise modified from time to time, the "Security Agreement"), between Torchlight U.S. Holdings, Inc., a Delaware corporation, and the Collateral Agent.
B. Pursuant to Section [●] of that certain Indenture dated as of April 19, 2022 (as amended and supplemented, including by that certain First Supplemental Indenture dated as of [●], 20[●], the "Indenture"), among Torchlight Mining Corp., as issuer, the guarantors party thereto, and Northern Dominion Trust Company, as trustee and collateral agent, the New Grantor is required to grant a first-priority security interest in substantially all of its assets to the Collateral Agent for the benefit of the Secured Parties.
C. The New Grantor desires to become a party to the Security Agreement and to grant a first-priority security interest in all of its Collateral (as defined in the Security Agreement) to the Collateral Agent for the benefit of the Secured Parties.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the New Grantor hereby agrees as follows:
1. Joinder. The New Grantor hereby becomes a party to the Security Agreement as a "Grantor" thereunder, with the same force and effect as if the New Grantor had been an original signatory thereto. From and after the date hereof, the New Grantor shall be bound by all of the terms, covenants, and conditions of the Security Agreement applicable to a Grantor.
2. Grant of Security Interest. To secure the prompt and complete payment and performance when due of all Secured Obligations (as defined in the Security Agreement), the New Grantor hereby grants to the Collateral Agent, for the ratable benefit of the Secured Parties, a continuing first-priority security interest in and lien upon all of the New Grantor's right, title, and interest in, to, and under all property and assets of the New Grantor, whether now owned or existing or hereafter acquired or arising, including all Collateral (as defined in the Security Agreement), and all proceeds and products thereof.
3. Representations and Warranties. The New Grantor hereby makes each of the representations and warranties set forth in the Security Agreement as if fully set forth herein, in each case with respect to the New Grantor and its Collateral.
4. Capitalized Terms. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Security Agreement or the Indenture, as applicable.
5. Governing Law. This Joinder shall be governed by and construed in accordance with the laws of the State of New York, without regard to principles of conflicts of law thereof (other than Section 5-1401 of the New York General Obligations Law).
[INSERT FULL LEGAL NAME OF NEW GUARANTOR], as New Grantor
By: ________
Name: [Insert]
Title: [Insert]
Acknowledged and Accepted:
NORTHERN DOMINION TRUST COMPANY, as Collateral Agent
By: ________
Name: [Insert]
Title: [Insert]