EXHIBIT 10.10a
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SUBSCRIPTION AGREEMENT
SUBSCRIPTION AGREEMENT (this "Agreement") made as of the date set forth on
the signature page hereof among, EMPIRE MINERALS CORP. (formerly known as Xacord
Corp.)., a Delaware corporation, having a place of business 000 Xxxx Xxxxxx,
00xx Xxxxx, Xxx Xxxx XX 00000 (the "Company"), and the undersigned, as
identified on the 'Signature Page' below (the "Subscriber" or "Investor").
WITNESSETH
WHEREAS, the Company is offering up to an aggregate of twenty units (the
"Units"), with each Unit consisting of 100,000 shares of Common Stock of the
Company (the "Share(s)") at a price of $50,000 per Unit or $2,000,000 in total.
The Company has reserved right to increase the number of shares sold ill this
"Offering" (as hereinafter defined) or sell additional shares in one or more
similar offering at no less than the price per share herein if offered within 90
days from the dateo of this Offering.
WHEREAS, the minimum subscription by any single Subscriber shall be one
Unit provided that the Company reserves the right to accept, at the discretion
of the Company, subscriptions for fractional Units;
WHEREAS, the 'Offering' shall terminate at the Company's discretion without
notice to Subscriber or on such date on which all of the offered Units are sold.
The 'Offering' is not contingent upon the sale of any minimum number of Units;
WHEREAS, the Company is offering (the "Offering") the Units to a limited
number of "accredited investors" (as that term is defined by Rule 501(a) of
Regulation D ("Regulation D") of the Securities Act of 1933, as amended (the
"Act"); and
WHEREAS, the Subscriber desires to purchase the number of Units set forth
on the Signature Page hereof on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the promises and the mutual
representations and covenants hereinafter set forth, the parties hereto do
hereby agree as follows:
ARTICLE I
SUBSCRIPTION FOR UNITS AND TERMS OF SUBSCRIPTION
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Subject to the terms and conditions hereinafter set forth, Subscriber
hereby subscribes for and agrees to purchase from the Company, and the Company
agrees to sell to Subscriber, the number of Units as is set forth upon the
Signature Page hereof against payment made by personal or business check, or
money order made payable to Empire Minerals Corp. In connection with the
Subscription:
1.1 The Subscriber hereby authorizes and directs the Company to deliver the
certificate for the Shares to be issued to the Subscriber pursuant to this
Agreement to the address indicated on the Signature Page hereto.
1.2 The Company's agreement with each Subscriber is a separate agreement
and the sale of Units to each Subscriber is a separate sale.
1.3 The Subscriber understands, acknowledges and agrees with the Company
that this subscription may be rejected, in whole or in part, by the Company, in
the sole and absolute discretion of the Company, at any time subscribed for by
the Subscriber, notwithstanding prior receipt by the Subscriber of notice of
acceptance of the Subscriber's subscription. The Subscriber understands,
acknowledges and agrees with the Company that, except as otherwise set forth
herein, the subscription hereunder is irrevocable by the Subscriber, except as
required by law, and, as such, the Subscriber is not entitled to cancel,
terminate or revoke this Agreement or any agreements of the Subscriber
hereunder.
1.4 The Company may at any time: (i) increase the offering price for
subscriptions not executed; or, (ii) terminate the Offering.
ARTICLE II
REPRESENTATIONS BY SUBSCRIBER
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In addition to the representations and warranties set forth in Article V
and elsewhere in this Agreement, the Subscriber, represents, warrants and
acknowledges to the Company that:
2.1 The Subscriber recognizes that: (i) the purchase of the Units involves
a high degree of risk, is speculative and only investors who can afford the loss
of their entire investment should consider investing in the Company and/or the
Units; (ii) the Subscriber may not be able to liquidate its investment; (iii)
transferability of the Shares is extremely limited; and, (iv) in the event of a
disposition of the Shares, the Subscriber could sustain the loss of its entire
investment.
2.2 The Subscriber represents that the Subscriber is an "accredited
investor", as indicated by the Subscriber's responses to the questions contained
in Article V.
2.3 The Subscriber hereby acknowledges that it has been furnished with, (i)
the Confidential Memorandum Supplement containing additional information
relating to the Company, including risk factors (the "Confidential Memorandum").
This Agreement and the Confidential Memorandum are collectively referred to
herein as the "Offering Documents." The Subscriber has carefully reviewed the
Offering Documents and is familiar with and understands the terms of the
Offering, including the rights to which the Subscriber is entitled under this
Agreement. The Subscriber specifically acknowledges and is familiar with the
Risk Factors set forth in the Confidential Memorandum.
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2.4 The Subscriber further represents and warrants that the Subscriber has
been furnished by the Company during the course of this transaction with all
information regarding the Company which the Subscriber, as well as its
investment advisor, attorney and/or accountant, has requested or desired to
know, and has been afforded the Opportunity to ask questions of and receive
answers from duly authorized officers or other representatives of the Company
concerning the terms and conditions of the Offering, and has received any
additional information which the Subscriber has requested concerning the terms
and conditions of the Offering and the Company.
2.5 The Subscriber has relied solely upon the information provided by the
Company in making the Subscriber's decision to invest in the Units and has not
relied upon any other representation or other information (whether oral or
written) from the Company, or any agent, employee or affiliate of the Company or
any other third party other than as set forth in the Offering, and the results
of Subscriber's own independent investigation.
2.6 The Subscriber represents that no Units were offered or sold to it by
means of any form of general solicitation or general advertising, and in
connection therewith the Subscriber did not: (A) receive or review any
advertisement, article, notice or other communication published in a newspaper
or magazine or similar media or broadcast over television or radio whether
closed circuit, or generally available; or (B) attend any seminar meeting or
industry investor conference whose attendees were invited by any general
solicitation or general advertising.
2.7 The Subscriber understands that the Units have not been registered
under the Act by reason of a claimed exemption under the provisions of the Act
which depends, in part, upon the Subscriber's investment intention. In this
connection, the Subscriber hereby represents that the Subscriber is purchasing
the Units for the Subscriber's own account for investment purposes only and not
o with a view toward the resale or distribution to others and has no contract,
undertaking, agreement or other arrangement, in existence or contemplated, to
sell, pledge, assign or otherwise transfer the Units to any other person.
2.8 The Subscriber consents to the placement of a legend on any certificate
or other document evidencing the Shares substantially as set forth below, that
such Shares have not been registered under the Act or any state securities or
"blue sky" laws and setting forth or referring to the restrictions on
transferability and sale thereof contained in this Agreement. The Subscriber is
aware that the Company will make a notation in o its appropriate records with
respect to the restrictions on the transferability of the Shares.
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE ISSUER OF THESE
SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
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SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR
RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES
LAWS.
2.9 The Subscriber agrees to supply the Company, within five business (5)
days after the Subscriber receives the request therefore from the Company, with
such additional information concerning the Subscriber as the Company deems
necessary or advisable.
2.10 The Subscriber understands, acknowledges and agrees with the Company
that the Offering is intended to be exempt from registration under the Act by
virtue of Section4(2) of the Act and the provisions of Regulation D thereunder,
which is in part dependent upon the truth, completeness and accuracy of the
statements made by the Subscriber and Subscriber will hold the Company harmless
from all liability, damages, costs and expenses resulting from any breach
thereof..
2.11 The Subscriber acknowledges that the information contained in the
Offering Documents or otherwise made available to the Subscriber is confidential
and non-public and agrees that all such information shall be kept in confidence
by the Subscriber and neither be used by the Subscriber for the Subscriber's
personal benefit (other than in connection with this Subscription) nor disclosed
to any third party for any reason, notwithstanding that the Subscriber's
Subscription may not be accepted by the Company. The Company acknowledges that
any information provided to Subscriber that is material non-public will be
disclosed in any registration statement covering the securities issued pursuant
to this Agreement and in any event no later that one year from the date of this
Agreement.
2.12 The Company is under no obligation to, and there can be no assurance
that, the Company will receive or accept subscriptions for the aggregate number
of Units that may be sold by the Company pursuant to the Offering.
ARTICLE III
REPRESENTATIONS BY AND COVENANTS OF THE COMPANY
-----------------------------------------------
3.1 The Company hereby represents and warrants to the Subscriber that,(i)
the Company has the requisite corporate power and authority to enter into and
perform its obligations under this Agreement and to sell and issue the Shares
and perform its obligations with respect to the Agreement in accordance with the
terms hereof and (ii) when executed and delivered by the Company, the Agreement
will be duly executed and delivered by the Company.
3.2 Due Incorporation. The Company is a corporation or other entity duly
incorporated or organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation or organization and has the requisite
corporate power to own its properties and to carryon its business as presently
conducted. The Company is duly qualified as a foreign corporation to do business
and is in good standing in each jurisdiction where the nature of the business
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conducted or property owned by it makes such qualification necessary, other than
those jurisdictions in which the failure to so qualify would not have a Material
Adverse Effect.
3.3 Outstanding Stock. All issued and outstanding shares of capital stock
of the Company and Subsidiary have been duly authorized and validly issued and
are fully paid and non-assessable.
3.4 No Market Manipulation. The Company and its Affiliates have not taken,
and will not take, directly or indirectly, any action designed to, or that might
reasonably be expected to, cause or result in stabilization or manipulation of
the price of the Common Stock to facilitate the sale or resale of the Securities
or affect the price at which the Securities may be issued or resold
3.5 No Integrated Offering. Neither the Company, nor any of its Affiliates,
nor any person acting on its or their behalf, has directly or indirectly made
any offers or sales of any security or solicited any offers to buy any security
under circumstances that would cause the offer of the Securities pursuant to
this Agreement to be integrated with prior offerings by the Company for purposes
of the 1933 Act or any applicable stockholder approval provisions, including,
without limitation, under the rules and regulations of the Bulletin Board which
would impair the exemptions relied upon in this Offering or the Company's
ability to timely comply with its obligations hereunder. Nor will the Company
nor any of its Affiliates take any action or steps that would cause the offer or
issuance of the Securities to be integrated with other offerings which would
impair the exemptions relied upon in this Offering or the Company's ability to
timely comply with its obligations hereunder. The Company will not conduct any
offering other than the transactions contemplated hereby that will be integrated
with the offer or issuance of the Securities, which would impair the exemptions
relied upon in this Offering or the Company's ability to timely comply with its
obligations hereunder.
3.6 Dilution. The Company's executive officers and directors understand the
nature of the Securities being sold hereby and recognize that the issuance of
the Securities will have a potential dilutive effect on the equity holdings of
other holders of the Company's equity or rights to receive equity of the
Company. The board of directors of the Company has concluded, in its good faith
business judgment that the issuance of the Securities is in the best interests
of the Company. The Company specifically acknowledges that its obligation to
issue the Shares upon conversion of the Notes, and the Warrant Shares upon
exercise of the Warrants, is binding upon the Company and enforceable regardless
of the dilution such issuance may have on the ownership interests of other
shareholders of the Company or parties entitled to receive equity of the
Company.
3.7 No Disagreements with Accountants and Lawyers. There are no material
disagreements of any kind presently existing, or reasonably anticipated by the
Company to arise between the Company and the accountants and lawyers presently
employed by the Company, including but not limited to disputes or conflicts over
payment owed to such accountants and lawyers, nor have there been any such
disagreements during the two years prior to the Closing Date.
3.8 Foreign Corrupt Practices. Neither the Company, nor to the knowledge of
the Company, any agent or other person acting on behalf of the Company, has (i)
directly or indirectly, used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses related to foreign or domestic
political activity, (ii) made any unlawful payment to foreign or domestic
government officials or employees or to any foreign or domestic political
parties or campaigns from corporate funds, (iii) failed to disclose fully any
contribution made by the Company (or made by any person acting on its behalf of
which the Company is aware) which is in violation of law, or (iv) violated in
any material respect any provision oft he Foreign Corrupt Practices Act of 1977,
as amended.
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3.9 Available Funds. The company represents that it has established various
sources of cash to fund its business plan to continue exploration activities
through July of 2008.
ARTICLE IV
MISCELLANEOUS
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4.1 Any notice or other communication to the Company given hereunder shall
be deemed sufficient if in writing and sent by registered or certified mail,
return receipt requested, or delivered by hand against written receipt
therefore. Notices shall be deemed to have been given or delivered on the date
of mailing, except notices of change of address, which shall be deemed to have
been given or delivered when received. The address for such notices and
communications shall be as follows:
If to the Company: Empire Minerals Corp.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx XX 00000
Attn.: Chief Executive Officer
If to a Subscriber: Xxxxx Xxxxxxxxxx
XX Xxx 000000
Xxxxxxxx XX 00000
4.2 Except as otherwise provided herein this Agreement shall not be
changed, modified or amended except by a writing signed by the parties to be
charged, and this Agreement may not be discharged except by performance in
accordance with its terms or by a writing signed by the party to be charged.
4.3 This Agreement shall be binding upon and inure to the benefit of the
parties hereto and to their respective heirs, legal representatives, successors
and assigns. This Agreement sets forth the entire agreement and understanding
between the parties as to the subject matter hereof and merges and supersedes
all prior discussions, agreements and understandings of any and every nature
among them. The Subscriber may not assign its rights and/or obligations under
this Agreement without the express written consent of Company.
4.4 NOTWITHSTANDING THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED BY ANY
OF THE PARTIES HERETO, THE PARTIES EXPRESSLY AGREE THAT ALL THE TERMS AND
PROVISIONS HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. IN
THE EVENT THAT A JUDICIAL PROCEEDING IS NECESSARY, THE EXCLUSIVE FORUMS FOR
RESOLVING DISPUTES ARISING OUT OF OR RELATING TO THIS AGREEMENT ARE EITHER THE
SUPREME COURT OF THE STATE OF NEW YORK IN AND FOR THE COUNTY OF NEW YORK OR THE
FEDERAL COURTS FOR SUCH STATE AND COUNTY. THE PARTIES HEREBY IRREVOCABLY CONSENT
TO THE JURISDICTION OF SUCH COURTS AND AGREE TO SAID VENUE.
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4.5 The holding of any provision of this Agreement to be invalid or
unenforceable by a court of competent jurisdiction shall not affect any other
provision of this Agreement, which shall remain in full force and effect. If any
provision of this Agreement shall be declared by a court of competent
jurisdiction to be invalid, illegal or incapable of being enforced in whole or
in part, such provision shall be interpreted so as to remain enforceable to the
maximum extent permissible consistent with applicable law and the remaining
conditions and provisions or portions thereof shall nevertheless remain in full
force and effect and enforceable to the extent they are valid, legal and
enforceable, and no provisions shall be deemed dependent upon any other covenant
or provision unless so expressed herein.
4.6 It is agreed that a waiver by either party of a breach of any provision
of this Agreement shall not operate, or be construed, as a waiver of any
subsequent breach by that same party.
4.7 The parties agree to execute and deliver all such further documents,
agreements and instruments and take such other and further action as may be
necessary or appropriate to carry out the purposes and intent of this Agreement.
4.8 This Agreement may be executed in two or more counterparts each of
which shall be deemed an original, but all of which shall together constitute
one and the same instrument.
4.9 The Subscriber agrees not to issue any o public statement with respect
to the Subscriber's investment or proposed investment in the Company or the
terms of any agreement or covenant between them and the Company without the
Company's prior written consent, except such disclosures as may be required
under applicable law or under any applicable order, rule or regulation.
4.10 The Subscriber represents and warrants that it has not engaged,
consented to nor authorized any broker, finder or intermediary to act on its
behalf, directly or indirectly, as a broker, finder or intermediary in
connection with the transactions contemplated by this Agreement. The Subscriber
hereby agrees to indemnify and hold harmless the Company from and against all
fees, commissions or other amounts owing to or claimed by any such person or
firm acting on behalf of the Subscriber hereunder.
4.11 Nothing in this Agreement shall create or be deemed to create any
rights in any person or entity not a party to this Agreement.
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ARTICLE V
CONFIDENTIAL INVESTOR QUESTIONNAIRE
-----------------------------------
5.1 Each person who desires to invest in Company, purchasing Shares as
pursuant to this Agreement and the Offering, must carefully and accurately
complete this Article V. The purpose of this questionnaire is to allow the
Company to make a reasonable determination as to whether each prospective
investor is qualified under applicable securities laws to purchase shares and/or
invest monies. This questionnaire completion and/or receipt of this
questionnaire does not constitute an offer to sell or a solicitation of an offer
to buy a security.
5.2 ACCREDITED INVESTOR. The Subscriber represents and warrants that he,
she or it is an 'Accredited Investor' and comes within one category marked
below, and that for any category marked, Subscriber has truthfully set forth,
where applicable, the factual basis or reason the Subscriber comes within that
category. ALL INFORMATION IN RESPONSE TO THIS SECTION WILL BE KEPT STRICTLY
CONFIDENTIAL except as otherwise required by law. The undersigned agrees to
furnish any additional information which the Company deems necessary in order to
verify the answers set forth below.
Category A ____ The undersigned is an individual (not a partnership,
corporation, etc.), whose individual net worth, or joint net
worth with his or her spouse, presently exceeds $1,000,000.
Explanation. In calculating net worth you may include equity
in personal property and real estate, including your
principal residence, cash, short-term investments, stock and
securities. Equity in personal property and real estate
should be based on the fair market value of such property
less debt secured by such property.
Category B ____ The undersigned is an individual (not a partnership,
corporation, etc.) who had an income in excess of
$200,000.00 in each of the two most recent years, or joint
income with his or her spouse in excess of $300,000.00 in
each of those years (in each case including foreign income,
tax exempt income and full amount of capital gains and
losses but excluding any income of other family members and
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any unrealized capital appreciation) and has a reasonable
expectation of reaching the same income level in the current
year.
Category C ____ The undersigned is a director or executive officer of the
Company which is issuing and selling the Shares.
Category D ____ The undersigned is a bank; a savings and loan association;
insurance company; registered investment company; registered
business development company; licensed small business
investment company ("SBIC"); or employee benefit plan within
the meaning of Title 1 of ERISA and (a) the investment
decision is made by a plan fiduciary which is either a bank,
savings and loan association, insurance company or
registered investment advisor, or (b) the plan has total
assets in excess of $5,000,000 or (c) is a self directed
plan with investment decisions made solely by persons that
are accredited investors. (describe entity)
____________________________________________________________
Category E ____ The undersigned is a private business development company as
defined in section 202(a) (22) of the Investment Advisors
Act of 1940. (describe entity) _____________________________
____________________________________________________________
Category F ____ The undersigned is either a corporation, partnership,
Massachusetts business trust, or non-profit organization
within the meaning of Section 501(c)(3) of the Internal
Revenue Code, in each case not formed for the specific
purpose of acquiring the Shares and with total assets in
excess of $5,000,000. (describe entity) ____________________
____________________________________________________________
Category G ___ The undersigned is a trust with total assets in excess of
$5,000,000, not formed for the specific purpose of acquiring
the Shares where the purchase is directed by a
"sophisticated investor" as defined in Regulation
506(b)(2)(ii) under the Act.
Category H ____ The undersigned is an entity (other than a trust) in which
all of the equity owners are "accredited investors" within
one or more of the above categories. If relying upon this
Category alone, each equity owner must complete a separate
copy ofthis Agreement. (describe entity)
____________________________________________________________
Category I ____ The undersigned is not within any of the categories above
and is therefore not an accredited investor.
The Subscriber agrees to notify the Company at any time on or prior to the
purchase and issuance of the Shares in the event that the representations and
warranties herein, and in this Agreement, shall cease to be true, accurate and
complete.
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5.3 MANNER IN WHICH TITLE IS TO BE HELD (circle one)
(a) Individual Ownership
(b) Community Property
(c) Joint Tenant witll Right of Survivorship (both parties must sign)
(d) *Partnership
(e) Tenants in Common
(f) *Company
(g) *Trust
(h) *Other
*If the Subscriber is an entity asterisked above, please complete the attached
Certificate of Signatory.
5.4 NASD AFFILIATION
Are you affiliated or associated with an NASD member firm (please check
one):
Yes ________ No _________
If Yes, please describe:
___________________________________________________________________________
___________________________________________________________________________
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SIGNATURE PAGE
Acknowledges and agrees to the terms of the foregoing Subscription Agreement.
Dated: July 31,2007.
By:________________________________ By:_____________________________________
Signature Signature (if purchasing jointly)
___________________________________ ________________________________________
Name Typed or Printed Name Typed or Printed
___________________________________ ________________________________________
Entity Name
___________________________________ ________________________________________
Address Address
___________________________________ ________________________________________
City, State and Zip Code City, State and Zip Code
___________________________________ ________________________________________
Telephone Telephone
___________________________________ ________________________________________
Facsimile Facsimile
___________________________________ ________________________________________
EIN Tax ID # or Social Security # EIN Tax ID # or Social Security #
___________________________________ X $50,000 - US$___________________________
Number of Units Subscribed Purchase Price
For by Subscriber
Name in which Shares should be issued/held:.____________________________________
If not Subscriber, Company must be notified in advance and approve the same.
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This Subscription Agreement is agreed to and accepted as July 31, 2007.
EMPIRE MINERALS CORP.
By: /s/ Xxxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Chairman & ChiefE Executive
Officer
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SUPPLEMENT TO SUBSCRIPTION AGREEMENT
The following supplenlents and amends the Amended Subscription Agreement
attached hereto. This document is to be attached to and made a part of the
Amended Subscription Agreement.
1. Except as otherwise provided in this Supplement, all words and terms
defined in the Amended Subscription Agreement have the same meanings in this
Supplement as such defined words and terms are given in the Amended Subscription
Agreement.
2. The Company agrees and acknowledges that the Investor will receive
Empire Minerals Corp. common stock acquired pursuant to the Subscription
Agreement and that Empire will instruct the Transfer Agent to issue such shares
on the day of closing.
3. The Company shall file with the Commission one or more Forms SB-2
registration statements (as defil1ed below) (or such other form that it is
eligible to use) in order to register the shares issued pursuant to this
Agreement and the shares issuable upon exercise ofthe warrants (the "Registrable
Securities") for resale and distribution under the 1933 Act. The Registration
Statement with respect to the Registrable Securities must be filed not later
than one hundred and fifty (150) days after the Closing Date ("Filing Date") and
declared effective by the Commission not later than the earlier of21 Oth day
after closing or the third business Day after receipt by the Company or its
counsel ofa written or oral commllnication from the Commission that the
Registration Statement will not be reviewed or that the COrmilission has no
comments or further comments that would impede the declaration ofeffectiveness
ofthe Registration Statement ("Effective Date"). The Registrable Securities
shall be reserved and set aside exclusively for the benefit ofthe Subscriber and
Warrant holder, pro rata, and not issued, employed or reserved for anyone other
than each such Subscriber and Warrant holder. The Registration Statement will be
amended or additional registration statements will be filed by the Company as
soon as reasonably practicable, and in any event no later that 30 days after
such need arises, as necessary to register additional shares of Common Stock to
allow the public resale ofall Common Stock included in and issuable by virtue
ofthe Registrable Securities.
4. The amount ofRegistrable Securities required to be included in the
Registration Statement as described in Section 3 ofthis Supplement ("Initial
Registrable Securities") shall be limited to not less than 100% of the maximum
amount ("Rule 415 Amount") of Common Stock which may be included in a single
Registration Statement without exceeding registration limitations imposed by the
Commission pursuant to Rule 415 ofthe 1933 Act, in any event not less than
2,000,000 shares ofthe Company's common stock. In the event that less than all
of the Initial Registrable Securities are included in the Registration Statement
as a result of the limitation described in this 4, then the Company will be
required to file additional Registration Statements each registering the Rule
415 Amount (each such Registration Statement a "Subsequent Registration
Statement"), seriatim, until all ofthe Initial Registrable Securities have been
registered. The Filing Date and Effective Date ofeach such additional
Registration Statement shall be, respectively, thirty (30) and sixty (60) days
after the first day such Subsequent Registration Statement may be filed without
objection by the Commission based on Rule 415 of the 1933 Act.
5. Non-Registration Events. The Company and the Subscribers agree that the
Sellers will suffer damages if a required Registration Statement is not filed by
the Filing Date and not declared effective by the Commission by the Effective
Date. Accordingly, if:
(A) a required Registration Statement is not filed on or before the
applicable Filing Date,
(B) a required Registration Statement is not declared effective on or
before the applicable Effective Date, or
(C) any Registration Statement described in Sections 3 or 4 is filed
and declared effective but shall thereafter cease to be effective without being
succeeded within twenty (20) business days by an effective replacement or
amended registration statement or for a period of time which shall exceed thirty
(30) trading days in the aggregate per year (defined as a period of 365 days
commencing on the Actual Effective Date; then the Company shall deliver to the
holder of Registrable Securities, as Liquidated Damages, an amount equal to two
percent (2%) for each thirty (30) days (or such lesser prorated amount for any
period of less than thirty (30) days) of the Purchase Price of the Registrable
Securities. The Company must pay the Liquidated Damages in cash. The Liquidated
Damages must be paid within ten (l0) days after the end of each thirty (30) day
period or shorter part thereof for which Liquidated Damages are payable. In the
event a Registration Statement is filed by the Filing Date but is withdrawn
prior to being declared effective by the Commission, then such Registration
Statement will be deemed to have not been filed. All oral or written comments
received from the Commission relating to the Registration Statement must be
satisfactorily responded to within ten (l0) business days after receipt of
comments from the Commission. Failure to timely respond to Commission comments
is a Non-Registration Event for which Liquidated Damages shall accrue and be
payable by the Company to the holders of Registrable Securities at the same rate
set forth above. Liquidated Damages will not accrue nor be payable pursuant to
this 5 nor will a Non-Registration Event be deemed to have occurred for times
during which Registrable Securities are transferable by the holder of
Registrable Securities pursuant to Rule 144(k) under the 1933 Act.
IN WITNESS WHEREOF, the undersigned has executed this supplement as ofthis
31 day of July, 2007.
EMPIRE MINERALS CORP. XXXXX XXXXXXXXXX
By: /s/ Xxxxxxx Althays By: /s/ Xxxxx Xxxxxxxxxx
----------------------------------- -----------------------------
Name: Xxxxxxx Xxxxxxx Name:
Title: Chairman & CEO Title:
EXHIBIT 10.10b
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THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED OR
OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR
EXEMPTION FROM REGISTRATION UNDER THE FOREGOING LAWS.
THIS WARRANT SHALL BE VOID AFTER 5:00 P.M. EASTERN TIME ON JULY 31, 2009 (THE
"EXPIRATION DATE") UNLESS SUBJECT TO EARLIER EXPIRATION PURSUANT TO A NOTICE OF
EARLIER EXPIRATION, AS DEFINED HEREIN.
PW No. 1001
EMPIRE MINERALS CORP.
WARRANT TO PURCHASE SHARES OF COMMON STOCK
FOR VALUE RECEIVED, Xxxxx Xxxxxxxxxx ("Warrantholder" or "Holder"), is
entitled to purchase, subject to the provisions of this Warrant, from Empire
Minerals Corp., a Delaware corporation ("Company") 1,000,000 shares ("Warrant
Shares") of the Company's common stock, par value $0.001 per share ("Common
Stock"). The Warrant may be exercised at any time not later than 5:00 P.M.,
Eastern time, on the `Expiration Date' (as defined above) or such earlier date
as set forth in the next paragraph, at an exercise price per share initially
equal to one dollar ($1.00) (the exercise price in effect being herein called
the "Warrant Price" or the "Exercise Price"). The number of Warrant Shares
purchasable upon exercise of this Warrant and the Warrant Price shall be subject
to adjustment from time to time as described herein.
Section 1. Transfers. As provided herein, this Warrant may be transferred
only pursuant to a registration statement filed under the Securities Act of
1933, as amended ("Securities Act"), or an exemption from such registration.
Subject to such restrictions, the Company shall transfer this Warrant from time
to time upon surrender thereof for transfer properly endorsed or accompanied by
appropriate instructions for transfer and such other documents as may be
reasonably required by the Company, including, if required by the Company, an
opinion of its counsel to the effect that such transfer is exempt from the
registration requirements of the Securities Act, to establish that such transfer
is being made in accordance with the terms hereof, and a new Warrant shall be
issued to the transferee and the surrendered Warrant shall be canceled by the
Company.
Section 2. Exercise of Warrant.
(a) Subject to the provisions hereof, Warrantholder may exercise this
Warrant in whole or in part at any time prior to its expiration with delivery of
the duly executed Warrant Exercise Form attached hereto and payment by cash,
certified check or wire transfer of funds for the aggregate Warrant Price for
that number of Warrant Shares then being purchased, to the Company during normal
business hours on any business day at the Company's principal executive offices
(or such other office or agency of the Company as it may designate by notice to
the holder hereof).
(b) The Warrant Shares so purchased shall be deemed to be issued to the
holder hereof or such holder's designee, as the record owner of such shares, as
of the close of business on the date on which this Warrant shall have been
surrendered or delivered (or evidence of loss, theft or destruction thereof and
security or indemnity satisfactory to the Company) and the Warrant Price shall
have been paid and the completed Warrant Exercise Form shall have been
delivered. Certificates for the Warrant Shares so purchased, representing the
aggregate number of shares specified in the Warrant Exercise Form, shall be
delivered to the holder hereof within a reasonable time, not exceeding three
days, after this Warrant shall have been so exercised. The Company understands
that a delay in the delivery of the Warrant Shares after the Warrant Share
Delivery Date could result in economic loss to the Holder. As compensation to
the Holder for such loss, the Company agrees to pay (as liquidated damages and
not as a penalty) to the Holder for late issuance of Warrant Shares upon
exercise of this Warrant the amount of $100 per business day after the Warrant
Share Delivery Date for each $10,000 of Exercise Price (and proportionately for
other amounts) of Warrant Shares for which this Warrant is exercised which are
not timely delivered. The certificates so delivered shall be in such
denominations as may be requested by the holder hereof and shall be registered
in the name of such holder or such other name as shall be designated by such
holder.
(c) Commencing twelve (12) months after the Issue Date, Registration
Statement covering the shares issuable upon exercise of this warrant is
unavailable, then payment upon exercise may be made at the option of the Holder
either in (i) cash, wire transfer or by certified or official bank check payable
to the order of the Company equal to the applicable aggregate Purchase Price,
(ii) by delivery of Common Stock issuable upon exercise of the Warrants in
accordance with Section (d) below or (iii) by a combination of any of the
foregoing methods, for the number of Common Stock specified in such form (as
such exercise number shall be adjusted to reflect any adjustment in the total
number of shares of Common Stock issuable to the holder per the terms of this
Warrant) and the holder shall thereupon be entitled to receive the number of
duly authorized, validly issued, fully-paid and non-assessable shares of Common
Stock (or Other Securities) determined as provided herein.
(d) Subject to the provisions herein to the contrary, if the Fair
Market Value of one share of Common Stock is greater than the Purchase Price (at
the date of calculation as set forth below), in lieu of exercising this Warrant
for cash, the holder may elect to receive shares equal to the value (as
determined below) of this Warrant (or the portion thereof being cancelled) by
surrender of this Warrant at the principal office of the Company together with
the properly endorsed Subscription Form in which event the Company shall issue
to the holder a number of shares of Common Stock computed using the following
formula:
2
X = Y (A-B)
-----------
A
Where X = the number of shares of Common Stock to be issued to the
holder
Y = the number of shares of Common Stock purchasable under the
Warrant or, if only a portion of the Warrant is being
exercised, the portion of the Warrant being exercised (at
the date of such calculation)
A = the average Fair Market Value of one share of the Company's
Common Stock for the ten (10) trading days prior to the
exercise date
B = Purchase Price (as adjusted to the date of such calculation)
For purposes of Rule 144 promulgated under the 1933 Act, it is intended,
understood and acknowledged that the Warrant Shares issued in a cashless
exercise transaction shall be deemed to have been acquired by the Holder, and
the holding period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued pursuant to the Subscription
Agreement.
(e) Buy-In. In addition to any other rights available to the Holder, if
the Company fails to deliver to a Holder the Warrant Shares as required pursuant
to this Warrant, within seven (7) business days after the Warrant Share Delivery
Date and the Holder or a broker on the Holder's behalf, purchases (in an open
market transaction or otherwise) shares of common stock to deliver in
satisfaction of a sale by such Holder of the Warrant Shares which the Holder was
entitled to receive from the Company (a "Buy-In"), then the Company shall pay in
cash to the Holder (in addition to any remedies available to or elected by the
Holder) the amount by which (A) the Holder's total purchase price (including
brokerage commissions, if any) for the shares of common stock so purchased
exceeds (B) the aggregate Purchase Price of the Warrant Shares required to have
been delivered together with interest thereon at a rate of 12% per annum,
accruing until such amount and any accrued interest thereon is paid in full
(which amount shall be paid as liquidated damages and not as a penalty). For
example, if a Holder purchases shares of Common Stock having a total purchase
price of $11,000 to cover a Buy-In with respect to $10,000 of Purchase Price of
Warrant Shares to have been received upon exercise of this Warrant, the Company
shall be required to pay the Holder $1,000, plus interest. The Holder shall
provide the Company written notice indicating the amounts payable to the Holder
in respect of the Buy-In.
Section 3. Compliance with the Securities Act of 1933. The Company may
cause the legend set forth on the first page of this Warrant to be set forth on
each Warrant or similar legend on any security issued or issuable upon exercise
of this Warrant, unless counsel for the Company is of the opinion as to any such
security that such legend is unnecessary.
Section 4. Payment of Taxes. The Company will pay any documentary stamp
taxes attributable to the initial issuance of Warrant Shares issuable upon the
exercise of the Warrant.
Section 5. Mutilated or Missing Warrants. In case this Warrant shall be
mutilated, lost, stolen, or destroyed, the Company shall issue in exchange and
substitution of and upon cancellation of the mutilated Warrant, or in lieu of
and substitution for the Warrant lost, stolen or destroyed, a new Warrant of
3
like tenor and for the purchase of a like number of Warrant Shares, 4 but only
upon receipt of evidence reasonably satisfactory to the Company of such loss,
theft or destruction of the Warrant, and with respect to a lost, stolen or
destroyed Warrant, reasonable indemnity or bond with respect thereto, if
requested by the Company.
Section 6. Reservation of Common Stock. The Company hereby represents and
Warrants that there have been reserved, and the Company shall at all applicable
times keep reserved until issued (if necessary) as contemplated by this Section
7, out of the authorized and unissued shares of Common Stock, sufficient shares
to provide for the exercise of the rights of purchase represented by this
Warrant. The Company agrees that all Warrant Shares issued upon due exercise of
the Warrant shall be, at the time of delivery of the certificates for such
Warrant Shares, duly authorized, validly issued, fully paid and non-assessable
shares of Common Stock of the Company.
Section 7. Adjustments. Subject and pursuant to the provisions of this
Section 7, the Warrant Price and number of Warrant Shares subject to this
Warrant shall be subject to adjustment from time to time as set forth
hereinafter.
(a) In the event that the Company shall (a) issue additional shares of
the Common Stock as a dividend or other distribution on outstanding Common
Stock, (b) subdivide its outstanding shares of Common Stock, or (c) combine its
outstanding shares of the Common Stock into a smaller number of shares of the
Common Stock, then, in each such event, the Exercise Price shall, simultaneously
with the happening of such event, be adjusted by multiplying the then Exercise
Price by a fraction, the numerator of which shall be the number of shares of
Common Stock outstanding immediately prior to such event and the denominator of
which shall be the number of shares of Common Stock outstanding immediately
after such event, and the product so obtained shall thereafter be the Exercise
Price then in effect. The Exercise Price, as so adjusted, shall be readjusted in
the same manner upon the happening of any successive event or events described
herein in this Section 7.
(b) If any capital reorganization, reclassification of the capital
stock of the Company, consolidation or merger of the Company with another
corporation in which the Company is not the survivor, or sale, transfer or other
disposition of all or substantially all of the Company's assets to another
corporation shall be effected, then, the Company shall ensure that lawful and
adequate provision shall be made whereby each Warrantholder shall thereafter
have the right to purchase and receive upon the basis and upon the terms and
conditions herein specified and in lieu of the Warrant Shares immediately
theretofore issuable upon exercise of the Warrant, such shares of stock,
securities or assets as would have been issuable or payable with respect to or
in exchange for a number of Warrant Shares equal to the number of Warrant Shares
immediately theretofore issuable upon exercise of the Warrant, had such
reorganization, reclassification, consolidation, merger, sale, transfer or other
disposition not taken place, and in any such case appropriate provision shall be
made with respect to the rights and interests of each Warrantholder to the end
that the provisions hereof (including, without limitation, provision for
adjustment of the Warrant Price) shall thereafter be applicable, as nearly
equivalent as may be practicable in relation to any shares of stock, securities
or assets thereafter deliverable upon the exercise thereof. The Company shall
not effect any such consolidation, merger, sale, transfer or other disposition
unless prior to or simultaneously with the consummation thereof the successor
corporation (if other than the Company) resulting from such consolidation or
merger, or the corporation purchasing or otherwise acquiring such assets or
other appropriate corporation or 5 entity shall assume the obligation to deliver
to the holder of the Warrant, at the last address of such holder appearing on
the books of the Company, such shares of stock, securities or assets as, in
accordance with the foregoing provisions, such holder may be entitled to
4
purchase, and the other obligations under this Warrant. The provisions of this
paragraph (b) shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers, sales, transfers or other
dispositions.
(c) Upon each adjustment of the Exercise Price pursuant to the
provisions of this Section 7, the number of shares of Warrant Stock issuable
upon the exercise of each Warrant shall be adjusted to the nearest full amount
by multiplying a number equal to the Exercise Price in effect immediately prior
to such adjustment by the number of shares of Warrant Stock issuable upon
exercise of the Warrants immediately prior to such adjustment and dividing the
product so obtained by the adjusted Exercise Price.
Section 8. Fractional Shares. The Company shall not be required to issue
fractions of Warrant Shares upon the exercise of this Warrant. If any fractional
share of Common Stock would, except for the provisions of the first sentence of
this Section 8, be deliverable upon such exercise, the Company, in lieu of
delivering such fractional share, shall pay to the exercising holder of this
Warrant an amount in cash equal to the Market Value of such fractional share of
Common Stock on the date of exercise.
Section 9. Notices of Adjustments. Upon the happening of any event
requiring an adjustment of the Warrant Price or the number of Warrant Shares
purchasable hereunder, the Company shall promptly give written notice thereof to
the Warrantholder at the address appearing in the records of the Company,
stating the adjusted Warrant Price and/or the adjusted number of Warrant Shares
resulting from such event and setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based. Failure to give
such notice to the Warrantholder or any defect therein shall not affect the
legality or validity of the subject adjustment.
Section 10. Benefits. Nothing in this Warrant shall be construed to give
any person, firm or corporation (other than the Company and the Warrantholder)
any legal or equitable right, remedy or claim, it being agreed that this Warrant
shall be for the sole and exclusive benefit of the Company and the
Warrantholder.
Section 11. Market Value. "Market Value" as of a particular date (the
"Valuation Date") shall mean the following: If the Common Stock is then listed
on a national stock exchange or NASDAQ ("Nasdaq"), or the Over-the-Counter
Bulletin Board, or the "pink sheets," the Market Value shall be the average
Market Price of one share of Common Stock in the most recent ten (10) trading
sessions during which the Common Stock has traded, "Market Price" shall mean the
closing sale price of one share of Common Stock as listed or quoted on the
primary exchange or quotation system on which the Common Stock is then listed or
quoted, of if not so listed or quoted, then the closing sale price quoted on the
Over-the-Counter Bulletin Board or on the "pink sheets," as applicable.
Section 12. Notices. Unless otherwise specifically provided herein, all
communications under this Warrant shall be in writing and shall be deemed to
5
have been duly 6 given (a) on the date personally delivered to the party to whom
notice is to be given, (b) on the day of transmission if sent by facsimile
transmission to a number provided to a party specifically for such purposes by
notice hereunder and the sending party receives confirmation of the completion
of such transmission, (c) on the business day after delivery to Federal Express
or similar overnight courier which utilizes a written form of receipt, or (d) on
the second day after mailing, if mailed to the party to whom notice is to be
given, by first class mail, registered or certified, postage prepaid, and
properly addressed, return receipt requested. All notices shall be addressed as
follows:
if to the Warrantholder:
Xxxxx Xxxxxxxxxx
XX Xxx 000000
Xxxxxxxx XX 00000
if to the Company:
Empire Minerals Corp.
000 Xxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxx XX 00000
Attn.: Xxxxxxx Xxxxxxx, Chief Executive Officer
or at such other address as the Warrantholder or the Company may designate by
five days' advance written notice to the other.
Section 15. Successors. All the covenants and provisions hereof by or for
the benefit of the Warrantholder shall bind and inure to the benefit of its
respective successors and assigns hereunder.
Section 16. Governing Law. This terms and conditions of the Warrant shall
be governed by, and construed in accordance with, the internal laws of the State
of Delaware, without reference to the choice of law provisions thereof. The
Company and, by accepting this Warrant, the Warrantholder, each irrevocably
submits to the exclusive jurisdiction of the federal/state courts of the State
of New York venued in the County of New York for the purpose of any suit,
action, proceeding or judgment relating to or arising out of this Warrant and
the transactions contemplated hereby. Service of process in connection with any
such suit, action or proceeding may be served on each party hereto anywhere in
the world by the same methods as are specified for the giving of notices under
this Warrant. The Company and, by accepting this Warrant, the Warrantholder,
each irrevocably consents to the jurisdiction of the aforementioned court(s) in
any such suit, action or proceeding and to the laying of venue in such court(s).
Section 17. No Rights as Shareholder. Prior to the exercise of this
Warrant, the Warrantholder shall not have or exercise any rights as a
shareholder of the Company by virtue of its ownership of this Warrant unless
specifically set forth herein.
6
Section 18. Amendments. This Warrant shall not be amended without the prior
written consent of the Company and the then current Warrantholder and any waiver
or amendment must be in writing signed by the party to be charged.
Section 19. Section Headings. The section headings in this Warrant are for
the convenience of the Company and the Warrantholder and in no way alter,
modify, amend, limit or restrict the provisions hereof.
[Signature(s)/execution(s) on the following page]
7
IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed, as of this 31 day of July 2007.
EMPIRE MINERALS CORP.
By: /s/ Xxxxxxx Xxxxxxx
------------------------------------------
Xxxxxxx Xxxxxxx, Chief Executive Officer
8
EMPIRE MINERALS CORP.
WARRANT EXERCISE FORM
To: Empire Minerals Corp.
The undersigned hereby irrevocably elects to exercise the right of purchase
represented by the within Warrant ("Warrant") for, and to purchase thereunder by
the payment of the Warrant Price and surrender of the Warrant, _______________
shares of Common Stock ("Warrant Shares") provided for therein, and requests
that certificates for the Warrant Shares be issued as follows:
__________________________________
Name
__________________________________
Address
__________________________________
__________________________________
Federal Tax ID or Social Security No.
and delivered by
[ ] certified mail to the above address, or
[ ] electronically (provide DWAC Instructions: ___________________);
or,
[ ] other (specify: _____________________________).
and, if the number of Warrant Shares shall not be all the Warrant Shares
purchasable upon exercise of the Warrant, and if the Warrant has not expired,
that a new Warrant for the balance of the Warrant Shares purchasable upon
exercise of this Warrant be registered in the name of the undersigned
Warrantholder or the undersigned's Assignee as below indicated and delivered to
the address stated below.
Note: The signature herein must correspond with the name of the registered
holder as written on the first page of the Warrant in every particular, without
alteration or enlargement or any change whatever, unless the Warrant has been
assigned and duly noted by Company.
By:__________________________
Name:________________________
Address:_____________________
EIN or Social Security No.
_____________________________
Assignee:_____________________
