Settlement Agreement and Releases

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Settlement Agreement and Releases

This Settlement Agreement and Releases (“Agreement”) is effective as of March 7th, 2007 (the “Effective Date”).

BY AND AMONG:

Nord Resources Corporation (“Nord”) and Platinum Diversified Mining, Inc. (“PDM”), Platinum Diversified Mining USA, Inc. (“PDM USA”) and PDM Merger Corp. (“Merger Sub”). PDM, PDM USA and Merger Sub are herein collectively referred to as the “PDM Parties”

WHEREAS:

A.            Nord and the PDM Parties entered into an Agreement and Plan of Merger dated October 23, 2006 (the “Merger Agreement”). Pursuant to the terms of the Merger Agreement, PDM USA, a wholly-owned subsidiary of PDM, agreed to acquire Nord through the merger of Merger Sub and Nord, with Nord as the surviving entity (the “Merger”), pursuant to which the issued and outstanding shares of common stock of Nord would be converted into the right to receive the consideration set forth in the Merger Agreement. In accordance with the terms of the Merger Agreement, the Merger was scheduled to close on December 22, 2006 (the “Closing Date”);

B.            On December 21, 2006, PDM advised Nord that it would not close the Merger on the Closing Date;

C.            The position of the PDM Parties is that the condition precedent set forth in Section 6.1(e) of the Merger Agreement was not satisfied;

D.            The position of Nord is that the condition precedent set forth in Section 6.1(e) of the Merger Agreement was satisfied;

E.            The position of the PDM Parties is that they were entitled to terminate the Merger Agreement pursuant to Section 7.2(a) thereof which provides that either of the parties could terminate the Merger Agreement if the Merger was not consummated by February 15, 2007;

F.            The position of Nord is that the PDM Parties were not entitled to terminate the Merger Agreement pursuant to Section 7.2(a) thereof because that section, by its terms, is not available to any party whose breach of an obligation under the Merger Agreement resulted in the failure of the Merger to be consummated;

G.            It is Nord’s further position that the PDM Parties breached their obligation under the Merger Agreement to consummate the Merger and that Nord, therefore, was entitled to terminate the Merger Agreement under Section 7.2(a) thereof and that, in such circumstances, Nord is entitled to the termination fee provided for in the Merger Agreement plus damages for any intentional breach of the Merger Agreement;

H.            Nord and the PDM Parties disagree as to whether the PDM Parties had a right, under the terms of the Merger Agreement, to elect not to proceed to close the Merger on

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December 22, 2006 and further disagree as to purported termination of the Merger Agreement by the other party and the applicability of termination fees thereto;

I.            PDM is a special purpose acquisition company formed to make investments in the mining industry;

J.            Approximately $77.9 million from the proceeds of PDM’s initial placement on the Alternative Investment Market of the London Stock Exchange plc (the “AIM”) were placed in escrow (the “Trust Funds”) pursuant to an Investment Management Trust Agreement (the “Trust Agreement”) dated March 8, 2006 between PDM and American Stock Transfer and Trust Company (“AST”), a copy of which is attached hereto as Schedule A;

K.            Pursuant to the terms of the Trust Agreement, the Trust Funds are to be paid out either: (i) upon PDM’s completion of an acquisition that has an aggregate fair market value at the closing date of such acquisition of not less than 50% of the Trust Funds and requires the approval of the PDM shareholders, all in accordance with the terms of the original document for the admission of PDM to trade on AIM (a “Qualifying Acquisition”); or (ii) upon the liquidation of PDM in the event that a Qualifying Acquisition is not completed by the deadlines provided in the Trust Agreement (the “PDM Liquidation”);

L.            Pursuant to a Deposit Escrow Agreement (the “Deposit Escrow Agreement”), dated October 23, 2006 by and among PDM USA, Nord and AST, a copy of which is attached hereto as Schedule B, the PDM Parties deposited $1 million in escrow with AST (the “Deposit Fund”);

M.            Nord and PDM wish to resolve their dispute and disagreements relating to the failure to close the Merger on the terms and conditions set out in this Agreement.

NOW THEREFORE, in consideration of the mutual promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, it is agreed as follows:

PART 1 - PAYMENT OF SETTLEMENT FUNDS

Subject to the terms and conditions of this Agreement, the PDM Parties agree to pay to Nord up to the sum of $3.6 million (the “Settlement Amount”) in full and final settlement of all claims and disputes between the parties, which sum shall be paid as follows:

1.1             The PDM Parties shall pay the aggregate sum of $1.1 million to Nord on signing of this Agreement, which amount shall be paid unconditionally, and the PDM Parties and Nord agree to provide to AST a joint, written instruction, substantially in the form attached as Schedule C hereto, executed by both PDM USA and Nord (and acknowledged by the other PDM Parties) that irrevocably instructs AST to immediately disburse to Nord the entire Deposit Fund (including interest, but excluding fees payable to AST). The PDM Parties agree to immediately pay to Nord by bank wire transfer in accordance with paragraph 1.7 the difference between $1.1 million and the Deposit Fund.

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1.2             Beginning on April 1, 2007, and on or before the first of each calendar month thereafter, PDM shall pay the sum of $50,000 to Nord (the “Monthly Payments”), which Monthly Payments shall be due and payable on the 1st day of each calendar month (or on the next following business day if the 1 ^st day of the month is a weekend or holiday), until the earlier of (i) completion of a Qualifying Acquisition by PDM and release of the Trust Funds, subject however to the provisions of paragraph 1.3(b); or (ii) the final disbursement of the Trust Funds pursuant to a PDM Liquidation under the Trust Agreement; provided, however, that PDM shall only be required to pay a pro rated portion of the Monthly Payment for any calendar month in which a Qualifying Acquisition or a PDM Liquidation occurs.

1.3            In the event that PDM completes a Qualifying Acquisition:

1.4            In the event of a PDM Liquidation, the amount paid by PDM to Nord prior to the PDM Liquidation shall be deemed to be the Settlement Amount, and PDM shall be relieved of any further obligations to Nord that arise after the date of a PDM Liquidation.

1.5            In addition to the Settlement Amount, the PDM Parties acknowledge that Nord is also entitled to retain any and all payments made by the PDM Parties in connection with Nord’s option under the “Terms of Agreement, Option to Purchase the ‘Coyote Springs’ Property, Graham County, Arizona” dated January 28, 2004, as amended between Nord and Thornwell Rogers, South Branch Resources LLC and MRPGEO, LLC.

1.6            All sums of money referred to in this Agreement are in U.S. dollars.

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1.7             All payments required to be made by the PDM Parties under this Agreement shall be made in cash by bank wire transfer of immediately available funds to the account of Nord as set forth below or as Nord may otherwise direct pursuant to a direction to pay to the PDM Parties made in writing at least 15 days before any payment hereunder becomes due.

Compass Bank
Routing #122105744
Acct #2500401373
Reference: Nord Resources Corporation

PART 2 – EVENTS OF DEFAULT

2.1             An event of default shall include, but is not limited to: