FORM OF WARRANT EXERCISE AGREEMENT
FORM OF WARRANT EXERCISE AGREEMENT
THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND ARE BEING OFFERED AND SOLD IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT. SUCH SECURITIES MAY NOT BE REOFFERED FOR SALE OR RESOLD OR OTHERWISE TRANSFERRED UNLESS THEY ARE REGISTERED UNDER THE APPLICABLE PROVISIONS OF THE ACT OR ARE EXEMPT FROM SUCH REGISTRATION. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION") OR BY ANY STATE SECURITIES ADMINISTRATION OR REGULATORY AUTHORITY.
WARRANT EXERCISE AGREEMENT (the “Agreement”) made as of this _____ day of December, 2003 between Silverado Gold Mines Ltd., a British Columbia company with its corporate office at Suite 505, 1111 West Georgia Street, Vancouver, British Columbia, Canada V6E 4M3 (the "Company") and the undersigned (the "Investor").
WHEREAS:
| A. | The Company sold an aggregate of 11,750,000 units
(the “Units”) at a price of $0.10 US per Unit pursuant to Rule
000 xx Xxxxxxxxxx X xx xxx Xxxxxx Xxxxxx Securities Act of 1933
(the “1933 Act”) and applicable state securities laws (the "Offering").
Each Unit was comprised of one common share of the Company (each a “Share”)
and one share purchase warrant (each a “Warrant”). Each Warrant
entitles the investor to purchase one additional common share of the Company
for a one year period from the closing of the Offering at an exercise
price, subject to adjustment, of $0.20 US per share. |
| B. | The Investor is an “accredited investor”, as defined in Rule 501 of Regulation D of the 1933 Act. |
| C. | The Investor purchased the number of units set forth
on the signature page to this Agreement (the “Investor Units”)
consisting of a corresponding number of shares (the “Investor Shares”)
and a corresponding number of share purchase warrants (the “Investor
Warrants”) pursuant to the Offering. |
| D. | The Company has filed a registration statement on
Form SB-2 pursuant to the 1933 Act in order to qualify the resale by the
Investor of the Investor Shares and the shares issuable upon exercise
of the Investor Warrants (the “Investor Warrant Shares”), which
registration statement was declared effective by the Securities and Exchange
Commission on October 20, 2003. |
| E. | The Investor has agreed to exercise the Investor
Warrants at a reduced exercise price on the terms and subject to the conditions
of this Warrant Exercise Agreement. |
NOW, THEREFORE, for and in consideration of the premises and the mutual covenants hereinafter set forth, the parties hereto do hereby agree as follows:
| 1. | EXERCISE OF INVESTOR WARRANTS | |
| 1.1 | Subject to the terms and
conditions hereinafter set forth, the exercise price of the Investor Warrants
is hereby reduced to $0.075 per share provided that: |
|
| (a) | the Investor Warrants are exercised on or before January 1, 2004; and | |
| (b) | the Investor will be entitled to exercise all or any portion of the Investor Warrants. | |
Any Investor Warrants that
are not exercised by January 1, 2004 in the manner contemplated by this
Section 1.1 will remain exercisable at the price of $0.20 per share. |
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| 1.2 | Upon exercise of the Investor
Warrants by the Investor in accordance with Section 1.1, the Company will
deliver to the Investor certificates representing the Investor Warrant
Shares forthwith upon receipt of the exercise price for the Investor Warrant
Shares. |
|
| 1.3 | Upon exercise of the Investor
Warrants in accordance with Section 1.1 by the Investor, the Company hereby
agrees to issue to the Investor additional warrants to purchase a number
of shares of the Company equal to the number of Investor Warrants exercised,
which additional warrants will be exercisable for a period from the date
of this Agreement to January 10, 2005 at an exercise price, subject to
adjustment, of $0.20 US per share (the “Investor Replacement Warrants”).
The Investor Replacement Warrants will be in the form attached hereto
as Schedule A. The Investor acknowledges that the Company may enter into
additional warrant exercise agreements with investors in the Offering
whereby the Company may grant additional replacement warrants on the equivalent
terms to the Investor Replacement Warrants to be issued by the Company
pursuant to this Agreement (these additional replacement warrants, together
with the Investor Replacement Warrants, are referred to collectively as
the “Replacement Warrants”). |
|
| 1.4 | Notwithstanding the exercise
price of the Investor Replacement Warrants, the Company agrees that the
Investor will be entitled to exercise the Investor Replacement Warrants
at a reduced exercise price of $0.075 per share, provided that: |
|
| (a) | the Investor Replacement Warrants are exercised on or before January 10, 2004; | |
| (b) | in aggregate, a total of 5,000,000 of
the Replacement Warrants are exercised by investors in the Offering, including
the Investor Replacement Warrants exercised by the Investor, on or before
January 10, 2004; |
|
| (c) | in the event that, in aggregate, more
than 5,000,000 of the Replacement Warrants are exercised on or before
January 10, 2004, then the number of Investor Replacement Warrants deemed
exercised by the Investor will be reduced according to the following formula
such that in aggregate 5,000,000 Replacement Warrants will have been exercised: |
|
| Number of Investor Replacement | 5,000,000 x | [Number of Investor Replacement | ||
| Warrants Deemed | = | Warrants Exercised by Investor] | ||
| Exercised by the Investor | ||||
| |
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| [Aggregate Number of Replacement | ||||
| Warrants Exercised] | ||||
| 1.5 | In the event the Investor
Replacement Warrants are exercised at the reduced exercise price of $0.075
per share on or before January 10, 2004 in accordance with Section 1.4
of this Agreement, the Company will: |
|
| (a) | issue to the Investor additional warrants to purchase
an additional number shares of the Company equal to the number of Investor
Replacement Warrants exercised pursuant to Section 1.4 of this Agreement,
which additional warrants will be exercisable for a period from the date
of issue to January 10, 2005 at an exercise price, subject to adjustment,
of $0.20 US per share (the “Investor Additional Replacement Warrants”).
In aggregate, a total of 5,000,000 additional warrants will be issued
to the investors exercising their Replacement Warrants, as contemplated
in Section 1.4, including the Investor Additional |
|
Replacement Warrants (together,
the “Additional Replacement Warrants”). The Investor Additional
Replacement Warrants will be in the form attached hereto as Schedule B;
and |
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| (b) | undertake to expeditiously register the resale of: | ||
| (i) | the resale of the shares issued to the
Investor upon exercise of the Investor Replacement Warrants in accordance
with Section 1.4 of this Agreement (the “Investor Replacement Warrant
Shares”). In aggregate, a total of 5,000,000 shares issued upon exercise
of the Replacement Warrants, including the Investor Replacement Warrant
Shares held by the Investor, will be included on the registration statement; |
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| (ii) | the resale of the shares issuable to
the Investor upon exercise of the Investor Additional Replacement Warrants
(the “Investor Additional Replacement Warrant Shares”). In aggregate,
a total of 5,000,000 shares issuable upon exercise of the Additional Replacement
Warrants will be included on the registration statement; and |
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| (iii) | the resale of the shares issuable upon the balance of the unexercised Investor Replacement Warrants. In aggregate, a total of 6,750,000 shares issuable upon exercise of the unexercised Replacement Warrants will be included on the registration statement; | ||
by the filing of a registration
statement on Form SB-2, or any other eligible form, with the Securities
Exchange Commission pursuant to the 1933 Act (the “Additional Registration
Statement”). The Company will pay all required expenses and fees
in connection with the preparation and filing of the Additional Registration
Statement. The Investor agrees that, without limitation, the Company may
exercise additional shares and warrant shares held by other investors
on the Additional Registration Statement. The Additional Registration
Statement will be filed with the Securities and Exchange Commission no
later than 60 days from the date of the completion of the exercise of
the aggregate of 5,000,000 Replacement Warrants in accordance with Section
1.4 of this Agreement. |
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| 1.6 | Limitation on Exercise.
Notwithstanding the provisions of this Agreement, the Investor Warrants,
the Investor Replacement Warrants or the Investor Additional Replacement
Warrants, in no event (except (i) as specifically provided in this Agreement
as an exception to this provision, (ii) while there is outstanding a tender
offer for any or all of the shares of the Company’s Common Stock,
or (iii) at the Investor’s option, on at least sixty-five (65) days’
advance written notice from the Investor) shall the Investor be entitled
to exercise the Investor Replacement Warrants or the Investor Additional
Replacement Warrants, or shall the Company have the obligation to issue
shares upon such exercise of all or any portion of the Investor Replacement
Warrants or the Investor Additional Replacement Warrants to the extent
that after such exercise the sum of (1) the number of shares of Common
Stock beneficially owned by the Investor and its affiliates (other than
shares of Common Stock which may be deemed beneficially owned through
the ownership of the unexercised portion of the Investor Replacement Warrants
and the Investor Additional Replacement Warrants or other rights to purchase
Common Stock or other convertible securities), and (2) the number of shares
of Common Stock issuable upon the exercise of the Investor Replacement
Warrants and the Investor Additional Replacement Warrants with respect
to which the determination of this proviso is being made, would result
in beneficial ownership by the Investor and its affiliates of more than
4.99% of the outstanding shares of Common Stock (after taking into account
the shares to be issued to the Investor upon such exercise). For purposes
of the proviso to the immediately preceding sentence, beneficial ownership
shall be determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended (the “1934 Act”), except as
otherwise provided in clause (1) of such sentence. The Investor, by its
execution of this Agreement, further agrees that if the Investor transfers
or assigns any of the Investor Replacement Warrants or Investor Additional
Replacement Warrants to a party who or which would not be considered such
an affiliate, such |
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assignment shall be made subject to the transferee’s
or assignee’s specific agreement to be bound by the provisions of
this Section 1.6 as if such transferee or assignee were the original holder
hereof. |
|
| 2. | RESTRICTED SHARE AGREEMENTS OF THE INVESTOR |
| 2.1 | The Investor agrees to resell the Investor Warrant
Shares, the Investor Replacement Warrants, the Investor Replacement Warrant
Shares, the Investor Additional Replacement Warrants and the Investor
Additional Replacement Warrant Shares only in accordance with the provisions
of the 1933 Act and applicable state securities laws. |
| 2.2 | The Investor acknowledges and agrees that the Investor Replacement Warrants, the Investor Replacement Warrant Shares, the Investor Additional Replacement Warrants and the Investor Additional Replacement Warrant Shares are or will be “restricted securities” under the 1933 Act and all certificates representing the Investor Replacement Warrants, the Investor Replacement Warrant Shares, the Investor Additional Replacement Warrants and the Investor Additional Replacement Warrant Shares will be endorsed with the following legend in accordance with Regulation D of the Act or such similar legend as deemed advisable by the lawyers for the Investor to ensure compliance with the 1933 Act: “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND HAVE BEEN OFFERED AND SOLD IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT. SUCH SECURITIES MAY NOT BE REOFFERED FOR SALE OR RESOLD OR OTHERWISE TRANSFERRED UNLESS THEY ARE REGISTERED UNDER THE APPLICABLE PROVISIONS OF THE ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT.” |
| 2.3 | The Investor is an “accredited investor”, as defined in Rule 501 of Regulation D of the 1933 Act. |
| 2.4 | The Investor has had full opportunity to review the
Company’s filings with the SEC pursuant to the Securities Exchange
Act of 1934, including the Company’s annual reports on Form 10-KSB
and quarterly reports on Form 10-QSB, and additional information regarding
the business and financial condition of the Company. The Investor believes
it has received all the information it considers necessary or appropriate
for deciding whether to purchase the securities that are the subject of
this Agreement. The Investor further represents that it has had an opportunity
to ask questions and receive answers from the Company regarding the terms
and conditions of the securities that are the subject of this agreement
and the business, properties, prospects and financial condition of the
Company. The Investor has had full opportunity to discuss this information
with the Investor’s legal and financial advisers prior to execution
of this Agreement. |
| 2.5 | The Investors is an investor in securities of companies
in the development stage and acknowledges that it is able to fend for
itself, can bear the economic risk of its investment, and has such knowledge
and experience in financial or business matters such that it is capable
of evaluating the merits and risks of the investment in the securities
that are the subject of this Agreement. The Investor can bear the economic
risk of this investment, and was not organized for the purpose of acquiring
the securities that are the subject of this Agreement. |
| 2.6 | The securities that are the subject of this Agreement
will be acquired by the Investor for investment for the Investor's own
account, not as a nominee or agent, and not with a view to the resale
or distribution of any part thereof, and that the Investor has no present
intention of selling, granting any participation in, or otherwise distributing
the same. The Investor does not have any contract, undertaking, agreement
or arrangement with any person to sell, transfer or grant participations
to such person or to any third person, with respect to any of the securities
that are the subject of this Agreement. |
| 3. | MISCELLANEOUS |
| 3.1 | Any notice or other communication given hereunder
shall be deemed sufficient if in writing and sent by registered or certified
mail, return receipt requested, addressed to the Company, at its corporate
office, at Suite 505, 1111 West Georgia Street, Vancouver, British Columbia,
Canada V6E 4M3, Attention: Xx. Xxxxx X. Xxxxxxx, President, and to the
Investor at his address indicated on the last page of this Agreement.
Notices shall be deemed to have been given on the date of mailing, except
notices of change of address, which shall be deemed to have been given
when received. |
| 3.2 | 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. |
| 3.3 | This Agreement supersedes and replaces any other
agreements, whether oral or in writing, regarding the exercise of the
Investor Warrants. |
| 3.4 | This Agreement may be executed in counterpart, each
of which shall be deemed an original, all of which together shall constitute
one and the same instrument. |
| 3.5 | 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 Province of British Columbia. |
IN WITNESS WHEREOF, this Agreement is executed as of the day and year first written above.
| Number of Units Originally Purchased: | Units |
| Signature of Investor or | |
| Authorized Signatory for Investor | |
| (if Investor is not an individual): | |
| Name of Authorized Signatory for Investor | |
| (if Investor is not an individual): | |
| Name of Investor: | |
| Address of Investor: | |
| Jurisdiction of Incorporation of Investor: (If Investor is | |
| a Corporation) | |
| ACCEPTED BY: | |
| SILVERADO GOLD MINES LTD. | |
| Signature Of Authorized Signatory: | |
| Name of Authorized Signatory: | |
| Position of Authorized Signatory: | |
| Date of Acceptance: |
EXHIBIT A
FORM OF REPLACEMENT WARRANT CERTIFICATE
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE OR UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THIS WARRANT AND THE UNDERLYING SECURITIES ARE RESTRICTED AND MAY NOT BE EXERCISED, OFFERED, RESOLD, PLEDGED OR TRANSFERRED EXCEPT AS PERMITTED APPLICABLE FEDERAL (UNITED STATES), STATE AND FOREIGN SECURITIES LAWS, PURSUANT TO EITHER AN EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS.
WARRANT CERTIFICATE NO. [@]
SILVERADO GOLD MINES LTD.,
A BRITISH COLUMBIA COMPANY
REPLACEMENT COMMON STOCK PURCHASE WARRANT CERTIFICATE
DECEMBER __, 2003
THIS IS TO CERTIFY THAT, for value received, «name», of «address»«state»«country» (the “Holder”), shall have the right to purchase from SILVERADO GOLD MINES LTD., a British Columbia company (the “Company”), [NO. OF WARRANT SHARES] ([NO. OF WARRANT SHARES]) fully paid and nonassessable common shares of the Company (the “Common Shares”) at an exercise price equal to $0.20 per share (the "Exercise Price") subject to further adjustment as set forth in Section 5 of the Terms and Conditions, at any time, subject to Section 6 of the Terms and Conditions, until 5:00 P.M., Eastern time, on the 10th day of January, 2005 (the “Expiration Date”) in accordance with the terms hereof and the Terms and Conditions set forth on the reverse of this Warrant Certificate, to which the Holder by acceptance of this Warrant Certificate agrees.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be duly executed and delivered by its duly authorized officer.
| SILVERADO GOLD MINES LTD. | ||||
| Attest: | By: | |||
| Xxxx X. XxxXxx, Secretary | Xxxxx X. Xxxxxxx, President | |||
STATEMENT OF TERMS AND CONDITIONS
| 1. | Exercise of Warrants.
This Warrant is exercisable in whole or in partial allotments of no less
than 1,000 shares at the Exercise Price per Common Share payable hereunder,
payable in cash or by certified or official bank check. Upon surrender
of this Warrant Certificate with the annexed Notice of Exercise Form duly
executed, together with payment of the Exercise Price for the Common Shares
purchased, the Holder shall be entitled to receive a certificate or certificates
for the Common Shares so purchased. No fractional shares shall be issued
in connection with any exercise of this Warrant. In lieu of the issuance
of any fractional share, the Company shall make a cash payment equal to
the then fair market value of such fractional share as determined by the
Company’s Board of Directors. |
|
| 2. | Reservation of Shares.
The Company hereby agrees that at all times during the term of this
Warrant there shall be reserved for issuance upon exercise of this Warrant
such number of Common Shares as shall be required for issuance upon exercise
of this Warrant (the “Warrant Shares”). |
|
| 3. | Mutilation or Loss of
Warrant. Upon receipt by the Company of evidence satisfactory to it
of the loss, theft, destruction or mutilation of this Warrant, and (in
the case of loss, theft or destruction) receipt of reasonably satisfactory
indemnification, and (in the case of mutilation) upon surrender and cancellation
of this Warrant, the Company will execute and deliver a new Warrant of
like tenor and date and any such lost, stolen, destroyed or mutilated
Warrant shall thereupon become void. |
|
| 4. | Rights of the Holder.
The Holder shall not, by virtue hereof, be entitled to any rights of a
stockholder in the Company, either at law or equity, and the rights of
the Holder are limited to those expressed in this Warrant and are not
enforceable against the Company except to the extent set forth herein. |
|
| 5. | Protection Against Dilution.
The Exercise Price and the number of shares which can be purchased
by the Holder upon the exercise of this Warrant shall be subject to adjustment
in the events and in the manner following: (1) If and whenever the shares
at any time outstanding shall be subdivided into a greater or consolidated
into a lesser number of shares, the Exercise Price shall be decreased
or increased proportionately as the case may be; upon any such subdivision
or consolidation, the number of shares which can be purchased upon the
exercise of this warrant certificate shall be increased or decreased proportionately
as the case may be. (2) In case of any capital reorganization or of any
reclassification of the capital of the Company or in case of the consolidation,
merger or amalgamation of the Company with or into any other company,
this Warrant shall after such capital reorganization, reclassification
of capital, consolidation, merger or amalgamation confer the right to
purchase the number of shares or other securities of the Company or of
the Company resulting from such capital reorganization, reclassification,
consolidation, merger or amalgamation, as the case may be, to which the
Holder of the shares deliverable at the time of such capital reorganization,
reclassification of capital, consolidation, merger or amalgamation, upon
the exercise of this Warrant would have been entitled. On such capital
reorganization, reclassification, consolidation, merger or amalgamation
appropriate adjustments shall be made in the application of the provisions
set forth herein with respect to the rights and interest thereafter of
the Holder of this Warrant so that the provisions set forth herein shall
thereafter be applicable as nearly as may reasonably be in relation to
any shares or other securities thereafter deliverable on the exercise
of this Warrant. (3) The rights of the Holder evidenced hereby are to
purchase shares prior to or on the date set out on the face of this Warrant.
If there shall, prior to the exercise of any of the rights evidenced hereby,
be any reorganization of the authorized capital of the Company by way
of consolidation, merger, subdivision, amalgamation or otherwise, or the
payment of any stock dividends, then there shall automatically be an adjustment
in either or both of the number of shares which may be purchased pursuant
hereto or the price at which such shares may be purchased so that the
rights evidenced hereby shall thereafter as reasonably as possible be
equivalent to those originally granted hereby. The Company shall have
the sole and exclusive power to make such adjustments as it considers
necessary and desirable. (4) The adjustments provided for herein in the
subscription rights represented by this Warrant are cumulative. |
|
| 6. | Limit Price Acceleration
of Exercise Period. In the event that, at any time following the date
that the Company shall have filed and obtained effectiveness of a registration
statement registering the resale of the shares to be acquired by the holder
on exercise of the warrants, the Company’s common shares shall trade
at a price in excess of $0.40 per share (the “Limit Price”)
for a period of 20 consecutive trading days, then the Holder shall have
15 days in which to elect whether or not to exercise the Warrants (the
“Accelerated Exercise Period”). In the event the Warrants are
not exercised within the Accelerated Exercise Period, they will expire
and the Holder will no longer have any right to exercise the Warrants.
Nothing in this Warrant Certificate will obligate the Company to file
any registration statement registering the resale of the shares to be
acquired by the holder on exercise of the warrants. |
|
| 7. | Transfer to Comply with
the Securities Act. This Warrant and the Warrant Shares have not been
registered under the Securities Act of 1933, as amended, (the "Act") and
has been issued to the Holder for investment purposes and not with a view
to the distribution of either the Warrant or the Warrant Shares. Neither
this Warrant nor any of the Warrant Shares or any other security issued
or issuable upon exercise of this Warrant may be sold, transferred, pledged
or hypothecated in the absence of an effective registration statement
under the Act relating to such security or an opinion of counsel reasonably
satisfactory to the Company that registration is not required under the
Act. Each certificate for the Warrant, the Warrant Shares and any other
security issued or issuable upon exercise of this Warrant shall contain
a legend on the face thereof, in form and substance satisfactory to counsel
for the Company, setting forth the restrictions on transfer contained
in this Section. The Holder understands that this Warrant and the stock
purchasable hereunder constitute “restricted securities” under
federal securities laws and acknowledges that Rule 144 of the Securities
and Exchange Commission is not now, and may not in the future be, available
for resales of this Warrant and/or the stock purchasable hereunder. All certificates representing the Warrant Shares will be endorsed with the following legend: “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND HAVE BEEN OFFERED AND SOLD IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT. SUCH SECURITIES MAY NOT BE OFFERED FOR SALE, TRANSFERRED, PLEDGED OR RESOLD OR OTHERWISE TRANSFERRED UNLESS THEY ARE REGISTERED UNDER THE APPLICABLE PROVISIONS OF THE ACT OR ARE EXEMPT FROM SUCH REGISTRATION REQUIREMENTS.” |
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| 8. | Payment of Taxes.
The Company shall not be required to pay any tax or other charge imposed
in connection with the exercise of this Warrant or a permissible transfer
involved in the issuance of any certificate for shares issuable under
this Warrant in the name other than that of the Holder, and in any such
case, the Company shall not be required to issue or deliver any stock
certificate until such tax or other charge has been paid or it has been
established to the Company’s satisfaction that no such tax or other
charge is due. |
|
| 9. | Notices. Any notice
required or permitted hereunder shall be given in writing and shall be
deemed effectively given upon, (a) by personal delivery or telecopy, or
(ii) one business day after deposit with a nationally recognized overnight
delivery service such as Federal Express, with postage and fees prepaid,
addressed to each of the other parties thereunto entitled at the following
addresses, or at such other addresses as a party may designate by written
notice to each of the other parties hereto. COMPANY: Silverado
Gold Mines Ltd., Attention: Xxxxx X. Xxxxxxx, President, Suite 505,
0000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0,
fax: (000) 000-0000; HOLDER: At the address set forth above. |
|
| 10. |
Governing Law. This Warrant shall be deemed to be a contract made under the laws of the Province of British Columbia and for all purposes shall be governed by and construed in accordance with the laws of such Province applicable to contracts to be made and performed entirely within such Province. |
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SUBSCRIPTION FORM TO: SILVERADO GOLD MINES LTD., A British Columbia
company (the “Company”) |
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| (a) | the Investor has not offered
or sold the Shares within the meaning of the United States Securities
Act of 1933 (the “Securities Act”); |
|
| (b) | the Investor is acquiring
the Shares for its own account for investment, with no present intention
of dividing my interest with others or of reselling or otherwise disposing
of all or any portion of the same; |
|
| (c) | the Investor does not intend
any sale of the Shares either currently or after the passage of a fixed
or determinable period of time or upon the occurrence or non-occurrence
of any predetermined event or circumstance; |
|
| (d) | the Investor has no present
or contemplated agreement, undertaking, arrangement, obligation, indebtedness
or commitment providing for or which is likely to compel a disposition
of the Shares; |
|
| (e) | the Investor is not aware
of any circumstances presently in existence which are likely in the future
to prompt a disposition of the Shares; |
|
| (f) | the Shares were offered
to the Investor in direct communication between the Investor and the Company
and not through any advertisement of any kind; |
|
| (g) | the Investor has the financial means to bear the economic risk of the investment which it hereby agrees to make. | |
| (h) | This subscription form will also confirm the Investor’s understanding as follows: | |
| (1) | the Shares have not been registered
under the Securities Act or applicable state “Blue Sky” laws
and, therefore, the Shares may not be resold, transferred or hypothecated
without the registration of the Shares, or an opinion of counsel satisfactory
to the Company to the effect that such registration is not necessary. |
|
| (2) | Only the Company can take action to
register the Shares under the Securities Act or applicable state securities
law or to comply with the requirements for an exemption under the Securities
Act or applicable state securities law, and the Company is under no obligation
to do so, and does not propose to attempt to do so. |
|
| (3) | The certificates representing the Shares
will be endorsed with the following legend: “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND HAVE BEEN OFFERED AND SOLD IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT. SUCH SECURITIES MAY NOT BE OFFERED FOR SALE, TRANSFERRED, PLEDGED OR RESOLD OR OTHERWISE TRANSFERRED UNLESS THEY ARE REGISTERED UNDER THE APPLICABLE PROVISIONS OF THE ACT OR ARE EXEMPT FROM SUCH REGISTRATION REQUIREMENTS.” |
|
| (i) | the Investor is an “accredited
investor”, as defined in Rule 501 of Regulation D of the Securities
Act. Please deliver a warrant certificate in respect of the common shares referred to in the warrant certificate surrendered herewith but not presently subscribed for, to the Investor. DATED this _____ day of _______________ , _____. |
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| Number of Shares Subscribed For: | Signature of Investor: | |||
| Name of Investor (please print): | Address of Investor: |
EXHIBIT B
FORM OF ADDITIONAL REPLACEMENT WARRANT CERTIFICATE
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE OR UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THIS WARRANT AND THE UNDERLYING SECURITIES ARE RESTRICTED AND MAY NOT BE EXERCISED, OFFERED, RESOLD, PLEDGED OR TRANSFERRED EXCEPT AS PERMITTED APPLICABLE FEDERAL (UNITED STATES), STATE AND FOREIGN SECURITIES LAWS, PURSUANT TO EITHER AN EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS.
WARRANT CERTIFICATE NO. [@]
SILVERADO GOLD MINES LTD.,
A BRITISH COLUMBIA COMPANY
ADDITIONAL REPLACEMENT COMMON STOCK PURCHASE WARRANT CERTIFICATE
DECEMBER __, 2003
THIS IS TO CERTIFY THAT, for value received, «name»,
of «address»«state»«country» (the
“Holder”), shall have the right to purchase from SILVERADO GOLD
MINES LTD., a British Columbia company (the “Company”), [NO. OF
WARRANT SHARES] ([NO. OF WARRANT SHARES]) fully paid and nonassessable
common shares of the Company (the “Common Shares”) at an exercise
price equal to $0.20 per share (the "Exercise Price"), subject to
further adjustment as set forth in Section 5 of the Terms and Conditions, at
any time, subject to Section 6 of the Terms and Conditions, until 5:00 P.M.,
Eastern time, on the 10th day of January, 2005 (the “Expiration Date”)
in accordance with the terms hereof and the Terms and Conditions set forth on
the reverse of this Warrant Certificate, to which the Holder by acceptance of
this Warrant Certificate agrees.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed and delivered by its duly authorized officer.
| SILVERADO GOLD MINES LTD. | ||||
| Attest: | By: | |||
| Xxxx X. XxxXxx, Secretary | Xxxxx X. Xxxxxxx, President | |||
STATEMENT OF TERMS AND CONDITIONS
| 1. | Exercise of Warrants.
This Warrant is exercisable in whole or in partial allotments of no less
than 1,000 shares at the Exercise Price per Common Share payable hereunder,
payable in cash or by certified or official bank check. Upon surrender
of this Warrant Certificate with the annexed Notice of Exercise Form duly
executed, together with payment of the Exercise Price for the Common Shares
purchased, the Holder shall be entitled to receive a certificate or certificates
for the Common Shares so purchased. No fractional shares shall be issued
in connection with any exercise of this Warrant. In lieu of the issuance
of any fractional share, the Company shall make a cash payment equal to
the then fair market value of such fractional share as determined by the
Company’s Board of Directors. NOTWITHSTANDING ANY OTHER PROVISION OF THIS WARRANT CERTIFICATE, THE HOLDER SHALL NOT BE ENTITLED TO EXERCISE ANY WARRANTS IF, AFTER GIVING EFFECT TO THE EXERCISE, THE HOLDER WILL BE THE LEGAL OR BENEFICIAL OWNER OF MORE THAN 4.9% OF THE COMMON SHARES OF THE COMPANY. THE HOLDER WILL PROVIDE TO THE COMPANY SUCH INFORMATION AS THE COMPANY MAY REASONABLY REQUIRE TO ENSURE COMPLIANCE WITH THIS PROVISION. |
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| 2. | Reservation of Shares.
The Company hereby agrees that at all times during the term of this Warrant
there shall be reserved for issuance upon exercise of this Warrant such
number of Common Shares as shall be required for issuance upon exercise
of this Warrant (the “Warrant Shares”). |
|
| 3. | Mutilation or Loss of
Warrant. Upon receipt by the Company of evidence satisfactory to it
of the loss, theft, destruction or mutilation of this Warrant, and (in
the case of loss, theft or destruction) receipt of reasonably satisfactory
indemnification, and (in the case of mutilation) upon surrender and cancellation
of this Warrant, the Company will execute and deliver a new Warrant of
like tenor and date and any such lost, stolen, destroyed or mutilated
Warrant shall thereupon become void. |
|
| 4. | Rights of the Holder.
The Holder shall not, by virtue hereof, be entitled to any rights of a
stockholder in the Company, either at law or equity, and the rights of
the Holder are limited to those expressed in this Warrant and are not
enforceable against the Company except to the extent set forth herein. |
|
| 5. | Protection Against Dilution.
The Exercise Price and the number of shares which can be purchased by
the Holder upon the exercise of this Warrant shall be subject to adjustment
in the events and in the manner following: (1) If and whenever the shares
at any time outstanding shall be subdivided into a greater or consolidated
into a lesser number of shares, the Exercise Price shall be decreased
or increased proportionately as the case may be; upon any such subdivision
or consolidation, the number of shares which can be purchased upon the
exercise of this warrant certificate shall be increased or decreased proportionately
as the case may be. (2) In case of any capital reorganization or of any
reclassification of the capital of the Company or in case of the consolidation,
merger or amalgamation of the Company with or into any other company,
this Warrant shall after such capital reorganization, reclassification
of capital, consolidation, merger or amalgamation confer the right to
purchase the number of shares or other securities of the Company or of
the Company resulting from such capital reorganization, reclassification,
consolidation, merger or amalgamation, as the case may be, to which the
Holder of the shares deliverable at the time of such capital reorganization,
reclassification of capital, consolidation, merger or amalgamation, upon
the exercise of this Warrant would have been entitled. On such capital
reorganization, reclassification, consolidation, merger or amalgamation
appropriate adjustments shall be made in the application of the provisions
set forth herein with respect to the rights and interest thereafter of
the Holder of this Warrant so that the provisions set forth herein shall
thereafter be applicable as nearly as may reasonably be in relation to
any shares or other securities thereafter deliverable on the exercise
of this Warrant. (3) The rights of the Holder evidenced hereby are to
purchase shares prior to or on the date set out on the face of this Warrant.
If there shall, prior to the exercise of any of the rights evidenced hereby,
be any reorganization of the authorized capital of the Company by way
of consolidation, merger, subdivision, amalgamation or otherwise, or the
payment of any stock dividends, then there shall automatically be an adjustment
in either or both of the number of shares which may be purchased pursuant
hereto or the price at which such shares may be purchased so that the
rights evidenced hereby shall thereafter as reasonably as possible be
equivalent to those originally granted hereby. The Company shall have
the sole and exclusive power to make such adjustments as it considers
necessary and desirable. (4) The adjustments provided for herein in the
subscription rights represented by this Warrant are cumulative. |
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| 6. | Limit Price Acceleration
of Exercise Period. In the event that, at any time following the date
that the Company shall have filed and obtained effectiveness of a registration
statement registering the resale of the shares to be acquired by the holder
on exercise of the warrants, the Company’s common shares shall trade
at a price in excess of $0.40 per share (the “Limit Price”)
for a period of 20 consecutive trading days, then the Holder shall have
15 days in which to elect whether or not to exercise the Warrants (the
“Accelerated Exercise Period”). In the event the Warrants are
not exercised within the Accelerated Exercise Period, they will expire
and the Holder will no longer have any right to exercise the Warrants.
Nothing in this Warrant Certificate will obligate the Company to file
any registration statement registering the resale of the shares to be
acquired by the holder on exercise of the warrants. |
|
| 7. | Transfer to Comply with
the Securities Act. This Warrant and the Warrant Shares have not been
registered under the Securities Act of 1933, as amended, (the "Act") and
has been issued to the Holder for investment purposes and not with a view
to the distribution of either the Warrant or the Warrant Shares. Neither
this Warrant nor any of the Warrant Shares or any other security issued
or issuable upon exercise of this Warrant may be sold, transferred, pledged
or hypothecated in the absence of an effective registration statement
under the Act relating to such security or an opinion of counsel reasonably
satisfactory to the Company that registration is not required under the
Act. Each certificate for the Warrant, the Warrant Shares and any other
security issued or issuable upon exercise of this Warrant shall contain
a legend on the face thereof, in form and substance satisfactory to counsel
for the Company, setting forth the restrictions on transfer contained
in this Section. The Holder understands that this Warrant and the stock
purchasable hereunder constitute “restricted securities” under
federal securities laws and acknowledges that Rule 144 of the Securities
and Exchange Commission is not now, and may not in the future be, available
for resales of this Warrant and/or the stock purchasable hereunder. All certificates representing the Warrant Shares will be endorsed with the following legend: “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND HAVE BEEN OFFERED AND SOLD IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT. SUCH SECURITIES MAY NOT BE OFFERED FOR SALE, TRANSFERRED, PLEDGED OR RESOLD OR OTHERWISE TRANSFERRED UNLESS THEY ARE REGISTERED UNDER THE APPLICABLE PROVISIONS OF THE ACT OR ARE EXEMPT FROM SUCH REGISTRATION REQUIREMENTS.” |
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| 8. | Payment of Taxes.
The Company shall not be required to pay any tax or other charge imposed
in connection with the exercise of this Warrant or a permissible transfer
involved in the issuance of any certificate for shares issuable under
this Warrant in the name other than that of the Holder, and in any such
case, the Company shall not be required to issue or deliver any stock
certificate until such tax or other charge has been paid or it has been
established to the Company’s satisfaction that no such tax or other
charge is due. |
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| 9. | Notices. Any notice
required or permitted hereunder shall be given in writing and shall be
deemed effectively given upon, (a) by personal delivery or telecopy, or
(ii) one business day after deposit with a nationally recognized overnight
delivery service such as Federal Express, with postage and fees prepaid,
addressed to each of the other parties thereunto entitled at the following
addresses, or at such other addresses as a party may designate by written
notice to each of the other parties hereto. COMPANY: Silverado
Gold Mines Ltd., Attention: Xxxxx X. Xxxxxxx, President, Suite 505,
0000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0,
fax: (000) 000-0000; HOLDER: At the address set forth above. |
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| 10. |
Governing Law. This Warrant shall be deemed
to be a contract made under the laws of the Province of British Columbia
and for all purposes shall be governed by and construed in accordance
with the laws of such Province applicable to contracts to be made and
performed entirely within such Province. |
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SUBSCRIPTION FORM TO: SILVERADO GOLD MINES LTD., A British Columbia company (the
“Company”) |
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| (a) | the Investor has not offered or sold the Shares within the meaning of the United States Securities Act of 1933 (the “Securities Act”); | |
| (b) | the Investor is acquiring the Shares for its own account for investment, with no present intention of dividing my interest with others or of reselling or otherwise disposing of all or any portion of the same; | |
| (c) | the Investor does not intend any sale of the Shares either currently or after the passage of a fixed or determinable period of time or upon the occurrence or non-occurrence of any predetermined event or circumstance; | |
| (d) | the Investor has no present or contemplated agreement, undertaking, arrangement, obligation, indebtedness or commitment providing for or which is likely to compel a disposition of the Shares; | |
| (e) | the Investor is not aware of any circumstances presently in existence which are likely in the future to prompt a disposition of the Shares; | |
| (f) | the Shares were offered to the Investor in direct communication between the Investor and the Company and not through any advertisement of any kind; | |
| (g) | the Investor has the financial means to bear the economic risk of the investment which it hereby agrees to make. | |
| (h) | This subscription form will also confirm the Investor’s understanding as follows: | |
| (1) | the Shares have not been registered
under the Securities Act or applicable state “Blue Sky” laws
and, therefore, the Shares may not be resold, transferred or hypothecated
without the registration of the Shares, or an opinion of counsel satisfactory
to the Company to the effect that such registration is not necessary. |
|
| (2) | Only the Company can take action to
register the Shares under the Securities Act or applicable state securities
law or to comply with the requirements for an exemption under the Securities
Act or applicable state securities law, and the Company is under no obligation
to do so, and does not propose to attempt to do so. |
|
| (3) | The certificates representing the Shares
will be endorsed with the following legend: “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND HAVE BEEN OFFERED AND SOLD IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT. SUCH SECURITIES MAY NOT BE OFFERED FOR SALE, TRANSFERRED, PLEDGED OR RESOLD OR OTHERWISE TRANSFERRED UNLESS THEY ARE REGISTERED UNDER THE APPLICABLE PROVISIONS OF THE ACT OR ARE EXEMPT FROM SUCH REGISTRATION REQUIREMENTS.” |
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| (i) | the Investor is an “accredited
investor”, as defined in Rule 501 of Regulation D of the Securities
Act. Please deliver a warrant certificate in respect of the common shares referred to in the warrant certificate surrendered herewith but not presently subscribed for, to the Investor. DATED this _____ day of _______________ , _____. |
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| Number of Shares Subscribed For: | Signature of Investor: | |||
| Name of Investor (please print): | Address of Investor: |
