Exhibit 10.1
QUOTA PURCHASE AGREEMENT
THIS AGREEMENT made as of the 6th day of February,
BETWEEN:
ARGYLE SECURITIES LIMITED
of
Trust House 112, Bonadie Street, Kingstown, Saint Xxxxxxx
OF THE FIRST PART.
-and -
WITS BASIN PRECIOUS MINERALS INC.
of
000 Xxxxxxxx Xxxx, Xxxxx 0000, Xxxxxxxxxxx, XX 00000, XXX
OF THE SECOND PART.
THIS AGREEMENT is made and entered into this 6th day of February 2004,
("Effective Date") by and between ARGYLE SECURITIES LIMITED, a
corporation organized under the laws of Saint Xxxxxxx ("Seller"), and
WITS BASIN PRECIOUS MINERALS INC, a Minnesota corporation
("Purchaser");
WHEREAS, the Seller is the record owner and holder of 9,999 (nine
thousand, nine hundred and ninety-nine) Quotas in the issued Quotas of
the capital of BRAZMIN LTDA, ("Company"), a limited liability company
incorporated in the City of Rio de Janeiro, Brazil, which Company has
issued Quotas of 10,000 Quotas of R1.00 (1 real) per Quota; and
WHEREAS, the Purchaser desires to purchase the Seller's Quotas and the
Seller desires to sell said Quotas, upon the terms and subject to the
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement and in order to consummate the purchase and
the sale of the Company's Quotas aforementioned, it is hereby agreed as
follows:
1. PURCHASE AND SALE:
Subject to the terms and conditions hereinafter set forth, at the
closing of the transaction contemplated hereby, the Seller shall sell,
convey, transfer, and deliver to the Purchaser, certificates
representing such Quotas, and the Purchaser shall purchase from the
Seller the Company's Quotas in consideration of the purchase price set
forth in this Agreement. The certificates representing the Company's
Quotas shall be duly endorsed for transfer or accompanied by
appropriate Quotas transfer powers duly executed in blank, and shall
have all the necessary documentary transfer tax stamps affixed thereto,
if any. The closing of the transactions contemplated by this Agreement
("Closing"), shall be held at 000 Xxxxxxxx Xxxx, Xxxxx 0000,
Xxxxxxxxxxx, XX 00000, XXX, on or as close to the Effective Date as is
possible or such other place, date and time as the parties hereto may
otherwise agree.
2. AMOUNT AND PAYMENT OF PURCHASE PRICE.
As total consideration for the purchase and sale of the Quotas,
pursuant to this Agreement, on Effective Date or as soon as is
practical thereafter but by no later than February 15, 2004, the
Purchaser shall pay, transfer, convey to the Seller or such other
party/parties to be designated by the Seller, the following:
(i) US$50,000.00 cash; and
(ii) 700,000 restricted common shares of the Purchaser
("WITM Shares"). The WITM Shares shall be issued in
the name of the Seller. The Purchaser acknowledges
that, following the registration of the WITM Shares as
contemplated by Paragraph (b) under "Purchaser
Represents and Warrants" in Section 3, Seller will be
free to transfer the WITM Shares as contemplated by
such registration. The certificates representing the
WITM Shares shall have all the necessary documentary
transfer tax stamps affixed thereto, if any; and
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(iii) 5-year warrant to purchase 150,000 common shares in
the Purchaser ("WITM Warrant") at the greater of
US$1.50 per share or the closing sale price of the
common stock of the Purchaser as listed on the OTCBB
at the Effective Date. The WITM Warrant shall be
issued in the name of the Seller and will be in the
form attached hereto as Exhibit A.
(iv) In addition to the Purchase Price as described in
Paragraphs 2(i),(ii),(iii), the Purchaser agrees to
the repayment of reasonable disbursements and out of
pocket expenses made by Tau Capital Corp or Seller
with regard to the Company in acquiring, maintaining
or securing existing or new projects for the Company
subsequent to December 1, 2003 until closing, not to
exceed US$20,000.00.
3. REPRESENTATIONS, WARRANTIES, AND INDEMNITIES OF SELLER AND PURCHASER.
Seller hereby warrants and represents:
(a) Organization and Standing.
Company is a company duly organized, validly existing and in good
standing under the laws of Brazil and has the corporate power and
authority to carry on its business as it is now being conducted.
(b) Restrictions on Quotas.
i. The Seller is not a party to any agreement, written or oral,
creating rights in respect to the Company's Quotas in any
third person or relating to the voting of the Company's
Quotas, other than what has been disclosed.
ii. Seller is the lawful owner of the Quotas, free and clear of
all security interests, liens, encumbrances, equities and
other charges, other than what has been disclosed.
iii. Neither the Company nor Seller has any existing warrants,
options, Quotas purchase agreements, redemption agreements,
restrictions of any nature, calls or rights to subscribe of
any character relating to the Quotas, nor are there any
securities convertible into such Quotas, other than what has
been disclosed.
(c) Accuracy of Information
i. As far as the Seller is aware, all data delivered to the
Purchaser by or on behalf of the Seller or the Company is
accurate.
ii. As far as the Seller is aware, the Company has all of the
rights necessary to explore and exploit each of the properties
identified in that certain memorandum from MPH Consulting to
Purchaser dated January 14, 2004, a copy of which Seller
acknowledges receiving.
(d) Investment in WITM Shares and Warrant.
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i. Seller recognizes that investment in the WITM Shares and the
WITM Warrants (together with the shares of Purchaser common
stock issuable upon exercise of the WITM Warrants, the
"Securities") involves a high degree of risk, that such
purchase may require be a long-term investment, that
transferability and sale of the Securities, as well as the
shares of common stock issuable upon conversion or exercise of
the Securities, are restricted in many ways, and that Seller
could sustain a total loss of its investment.
ii. Seller represents and warrants that it is its intention to
acquire the Securities for its own account for investment
purposes and not with a view to resale in connection with any
distribution thereof until registration of the WITM Shares as
contemplated by Paragraph (b) under "Purchaser Represents and
Warrants" in Section 3. Seller intends to receive and hold the
Securities for its personal account. Seller represents and
warrants that it is an "accredited investor" as defined by
Rule 501(a) under the Securities Act.
iii. Seller understands that: (i) the Securities have not been
registered under the United States Securities Act of 1933, as
amended (the "Securities Act") or any securities laws of any
state or other jurisdiction, and may not be offered for sale,
sold, transferred, pledged or otherwise assigned unless (A)
subsequently registered thereunder, or (B) Seller shall have
delivered to the Purchaser, at the expense of Seller or its
transferee, an opinion of counsel reasonably satisfactory to
the Purchaser, to the effect that such Securities to be sold,
transferred, pledged or otherwise assigned may be sold,
transferred, pledged or otherwise assigned pursuant to an
exemption from such registration, and (ii) any sale of the
Securities made in reliance on Rule 144 promulgated under the
Securities Act or any successor rule thereto ("Rule 144") may
be made only in accordance with the terms of Rule 144 and
further, if Rule 144 is not applicable, any resale of the
Securities under circumstances in which the seller (or the
person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the Securities Act)
may require compliance with some other exemption under the
Securities Act or the rules and regulations of the United
States Securities and Exchange Commission thereunder.
iv. Until the Securities have been transferred pursuant to an
effective registration statement, as contemplated by Paragraph
(b) under "Purchaser Hereby Represents and Warrants" in this
Section 3, or pursuant to an exemption to the securities laws
reasonable acceptable to the Purchaser and its counsel, Seller
understands that the certificates or other instruments
representing the Securities shall bear a restrictive legend in
substantially the following form (and a stop-transfer order
may be placed against transfer of such certificates or
instruments):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
("SECURITIES ACT"), OR REGISTERED OR QUALIFIED UNDER ANY
APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE OFFERED,
SOLD, TRANSFERRED, HYPOTHECATED, PLEDGED OR OTHERWISE ASSIGNED
UNLESS (A) COVERED BY AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND REGISTERED OR QUALIFIED UNDER
APPLICABLE STATE SECURITIES LAWS OR (B) EXEMPTIONS FROM SUCH
REGISTRATION OR QUALIFICATION REQUIREMENTS ARE AVAILABLE. AS A
CONDITION TO PERMITTING ANY TRANSFER OF THESE SECURITIES, THE
COMPANY MAY REQUIRE THAT IT BE FURNISHED WITH AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY TO THE EFFECT THAT NO
REGISTRATION OR QUALIFICATION IS LEGALLY REQUIRED FOR SUCH
TRANSFER.
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Purchaser hereby warrants and represents:
(a) Authorization
The Purchaser has received the prerequisite number of board members
signatures to consummate this transaction.
(b) Restrictions on Shares.
i. The Purchaser is not a party to any agreement, written or
oral, creating rights in respect to the WITM Shares in any
third person or relating to the voting of the WITM Shares.
ii. Purchaser has the authority to issue WITM Shares free and
clear of all security interests, liens, encumbrances, equities
and other charges.
iii. The Purchaser will use its commercially reasonable best
efforts to have the WITM Shares registered for resale under
the Securities Act no later than July 5, 2004. In the event
that such shares are not so registered by July 5, 2004, the
Seller will have the sole right (exercisable within ten (10)
days thereafter) to terminate this Agreement subject to the
upholding and unconditional survival of Paragraph 2(i)and
2(iv) above. In the event that the Seller elects to terminate
as described, the Seller shall return the WITM Shares and the
WITM Warrant to Purchaser and agree to the cancellation of the
Consultants Agreements, Purchaser shall return to Seller the
Quotas and, thereafter, other than the fulfillment of the
obligations in terms of Paragraph 2(i)and 2(iv) above, neither
party shall have any further obligation to the other.
Seller and Purchaser hereby represent and warrant:
i. that there has been no act or omission by Seller, Purchaser or
the Company which would give rise to any valid claim against
any of the parties hereto for a brokerage commission, finder's
fee, or other like payment in connection with the transactions
contemplated hereby.
ii. that they are entitled and authorized to do that which is
required in order to give effect to this Agreement
Indemnification:
a. Indemnification by Seller.
Seller shall indemnify, defend and hold harmless Purchaser and
its directors, officers, employees, agents, consultants,
representatives, successors, transferees and assigns
(individually a "Purchaser Indemnified Party"; and
collectively, the "Purchaser's Indemnified Parties"), promptly
upon demand, at any time and from time to time, from, against,
and in respect of any and all demands, claims, losses,
damages, judgments, liabilities, assessments, suits, actions,
proceedings, interest, penalties, and expenses (including,
without limitation, legal expenses for investigating or
defending any actions or threatened actions or for enforcing
such rights of indemnity and defense) incurred or suffered by
the Purchaser's Indemnified Parties, in connection with,
arising out of or as a result of each and all of the
following:
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(i) any breach of any representation or warranty
made by Seller in this Agreement or in any
other document or instrument delivered by
Seller to Purchaser or entered into as part
of the transactions contemplated by this
Agreement;
(ii) the material breach of any covenant,
agreement or obligation of Seller contained
in this Agreement or any other document or
instrument delivered by Seller to Purchaser
or entered into as part of the transactions
contemplated by this Agreement; and
(iii) subject to paragraph 2(iv) above, any and
all liabilities and obligations of Seller or
the Company and any and all liabilities and
obligations arising from ownership of the
Quotas or operation of the Company on or
prior to the Closing.
b. Indemnification by Purchaser.
Purchaser shall indemnify, defend and hold harmless Seller and its
directors, officers, employees, agents, consultants, representatives,
successors, transferees and assigns (individually a "Seller Indemnified
Party"; and collectively, the "Seller's Indemnified Parties"), promptly
upon demand, at any time and from time to time, from, against, and in
respect of any and all demands, claims, losses, damages, judgments,
liabilities, assessments, suits, actions, proceedings, interest,
penalties, and expenses (including, without limitation, legal expenses
for investigating or defending any actions or threatened actions or for
enforcing such rights of indemnity and defense) incurred or suffered by
the Seller's Indemnified Parties, in connection with, arising out of or
as a result of each and all of the following:
(i) any breach of any representation or warranty
made by Purchaser in this Agreement or in
any other document or instrument delivered
by Purchaser to Seller or entered into as
part of the transactions contemplated by
this Agreement;
(ii) the material breach of any covenant,
agreement or obligation of Purchaser
contained in this Agreement or any other
document or instrument delivered by
Purchaser to Seller or entered into as part
of the transactions contemplated by this
Agreement; and
(iii) any and all liabilities and obligations
arising from ownership of the Quotas or
operation of the Company after the Closing.
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Survival.
The representations and warranties contained in this Agreement shall
survive the Closing for a period of one (1) year.
4. CONSULTING AGREEMENTS
The Purchaser agrees to cause the Company to enter into consulting
agreements with Xxxx Xxxxxxxx (Tau Capital Corp) and Xxxx Xxxxxxx (the
"Consultants") on such terms and conditions as would be negotiated and
agreed by the Purchaser and the Consultants. The Consultants intend to
offer services to the Company in connection with identifying, acquiring
and commercializing gold exploration and mining opportunities in
Brazil. In addition, the Consultants will assist the Company in
connection with the exploration and, if warranted, the exploitation of
the Company's current projects. Notwithstanding the foregoing, the
terms of such consulting agreements shall make provision for consulting
fees to both Consultants of not less than an aggregate of US$4,000 per
month (such funds to be guaranteed by the Purchaser) and a 6-month
term, subject to extensions upon the mutual agreement of the parties.
The consulting agreements shall also provide for such other terms to be
mutually agreed upon by the parties, including without limitation,
provisions relating to incentive compensation, confidentiality,
assignment to the Purchaser or Company of intellectual property rights
in past and future work product and restrictions on competition, and a
provision for automatic cancellation in the event this Agreement is
terminated by Seller pursuant to Paragraph 3.
5. EXPENSES.
The Purchaser agrees to pay expenses incident to this Agreement and the
transactions contemplated thereby until Closing.
6. GENERAL PROVISIONS.
(a) Entire Agreement.
This Agreement constitutes the entire Agreement and supersedes all
prior agreements and understandings, oral and written, between the
parties hereto with respect to the subject matter hereof.
(b) Sections and Other Headings.
The section and other headings contained in this Agreement are for
reference purposes only and shall not affect the meaning or
interpretation of this Agreement.
(c) Severability.
If any provision of this Agreement is held invalid or unenforceable by
any court of competent jurisdiction, the other provisions of this
Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will
remain in full force and effect to the extent not held invalid or
unenforceable.
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(d) Governing Law.
This agreement, and all transactions contemplated hereby, shall be
governed by, construed and enforced in accordance with the laws of the
State of Minnesota. The parties herein agree to submit to the
jurisdiction and venue of a court of subject matter jurisdiction
located in Minneapolis, Minnesota, USA. In the event that litigation
results from or arises out of this Agreement or the performance
thereof, the parties agree to reimburse the prevailing party's
reasonable attorney's fees, court costs, and all other expenses,
whether or not taxable by the court as costs, in addition to any other
relief to which the prevailing party may be entitled.
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SIGNED AT THIS DAY OF 2004.
AS WITNESSES:
1.
2.
/s/ Xxxxxx Xxxxxxxx
------------------------------------
ARGYLE SECURITIES LIMITED
being duly authorized thereto
SIGNED AT THIS 6th DAY OF February 2004.
AS WITNESSES:
1.
2.
/s/ X. Xxxxx White
-------------------------------------
WITS BASIN PRECIOUS MINERALS INC.
being duly authorized thereto
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EXHIBIT "A"
The Warrant and the securities issuable upon exercise of this Warrant (the
"Securities") have not been registered under the Securities Act of 1933 (the
"Securities Act") or under any state securities or Blue Sky laws ("Blue Sky
Laws"). No transfer, sale, assignment, pledge, hypothecation or other
disposition of this Warrant or the Securities or any interest therein may be
made except (a) pursuant to an effective registration statement under the
Securities Act and any applicable Blue Sky Laws or (b) if the Company has been
furnished with both an opinion of counsel for the holder, which opinion and
counsel shall be reasonably satisfactory to the Company, to the effect that no
registration is required because of the availability of an exemption from
registration under the Securities Act and applicable Blue Sky Laws, and
assurances that the transfer, sale, assignment, pledge, hypothecation or other
disposition will be made only in compliance with the conditions of any such
registration or exemption.
WARRANT TO PURCHASE SHARES OF COMMON STOCK
OF WITS BASIN PRECIOUS MINERALS INC.
Warrant No. 0000-__ Xxxxxxxxxxx, Xxxxxxxxx
February __, 2004
This certifies that, for value received, Argyle Securities Limited, or
its successors or assigns (the "Holder"), is entitled to purchase from Wits
Basin Precious Minerals Inc., a Minnesota corporation (the "Company"), One
Hundred Fifty Thousand (150,000) fully paid and nonassessable shares (the
"Shares") of the Company's Common Stock, $.01 par value (the "Common Stock"), at
an exercise price of $[____] per share (the "Exercise Price"), subject to
adjustment as herein provided. This Warrant may be exercised by Holder at any
time after the date hereof; provided, however, that, Holder shall in no event
have the right to exercise this Warrant or any portion thereof after February
__, 2009, at which time all of Holder's rights hereunder shall expire.
This Warrant is subject to the following provisions, terms and
conditions:
1. Exercise of Warrant. The rights represented by this Warrant may be
exercised by the Holder, in whole or in part (but not as to a fractional share
of Common Stock), by the surrender of this Warrant (properly endorsed, if
required, at the Company's principal office in Minneapolis, Minnesota, or such
other office or agency of the Company as the Company may designate by notice in
writing to the Holder at the address of such Holder appearing on the books of
the Company at any time within the period above named), and upon payment to it
by certified check, bank draft or cash of the purchase price for such Shares.
The Company agrees that the Shares so purchased shall have and are deemed to be
issued to the Holder as the record owner of such Shares as of the close of
business on the date on which this Warrant shall have been surrendered and
payment made for such Shares as aforesaid. Certificates for the Shares of Common
Stock so purchased shall be delivered to the Holder within a reasonable time,
not exceeding ten (10) days, after the rights represented by this Warrant shall
have been so exercised, and, unless this Warrant has expired, a new Warrant
representing the number of Shares, if any, with respect to which this Warrant
shall not then have been exercised shall also be delivered to the Holder within
such time. The Company may require that any such new Warrant or any certificate
for Shares purchased upon the exercise hereof bear a legend substantially
similar to that which is contained on the face of this Warrant.
2. Transferability of this Warrant. This Warrant is issued upon the
following terms, to which Holder consents and agrees:
(a) Until this Warrant is transferred on the books of the
Company, the Company will treat the Holder of this Warrant registered as such on
the books of the Company as the absolute owner hereof for all purposes without
being affected by any notice to the contrary.
(b) This Warrant may not be exercised, and this Warrant and
the Shares underlying this Warrant shall not be transferable, except in
compliance with all applicable state and federal securities laws, regulations
and orders, and with all other applicable laws, regulations and orders.
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(c) The Warrant may not be transferred, and the Shares
underlying this Warrant may not be transferred, without the Holder obtaining an
opinion of counsel satisfactory in form and substance to the Company's counsel
stating that the proposed transaction will not result in a prohibited
transaction under the Securities Act of 1933, as amended ("Securities Act"), and
applicable Blue Sky laws. By accepting this Warrant, the Holder agrees to act in
accordance with any conditions reasonably imposed on such transfer by such
opinion of counsel.
(d) Neither this issuance of this Warrant nor the issuance of
the Shares underlying this Warrant have been registered under the Securities
Act.
3. Certain Covenants of the Company. The Company covenants and agrees
that all Shares which may be issued upon the exercise of the rights represented
by this Warrant, upon issuance and full payment for the Shares so purchased,
will be duly authorized and issued, fully paid and nonassessable and free from
all taxes, liens and charges with respect to the issue hereof, except those that
may be created by or imposed upon the Holder or its property, and without
limiting the generality of the foregoing, the Company covenants and agrees that
it will from time to time take all such actions as may be requisite to assure
that the par value per share of the Common Stock is at all times equal to or
less than the effective purchase price per share of the Common Stock issuable
pursuant to this Warrant. The Company further covenants and agrees that during
the period within which the rights represented by this Warrant may be exercised,
the Company will at all times have authorized and reserved free of preemptive or
other rights for the exclusive purpose of issue upon exercise of the purchase
rights evidenced by this Warrant, a sufficient number of shares of its Common
Stock to provide for the exercise of the rights represented by this Warrant.
4. Adjustment of Exercise Price and Number of Shares. The Exercise
Price and number of Shares are subject to the following adjustments:
(a) Adjustment of Exercise Price for Stock Dividend, Stock
Split or Stock Combination. In the event that (i) any dividends on any class of
stock of the Company payable in Common Stock or securities convertible into or
exercisable for Common Stock ("Common Stock Equivalents") shall be paid by the
Company, (ii) the Company shall subdivide its then outstanding shares of Common
Stock into a greater number of shares, or (iii) the Company shall combine its
outstanding shares of Common Stock, by reclassification or otherwise, then, in
any such event, the Exercise Price in effect immediately prior to such event
shall (until adjusted again pursuant hereto) be adjusted immediately after such
event to a price (calculated to the nearest full cent) determined by dividing
(a) the number of shares of Common Stock outstanding immediately prior to such
event, multiplied by the then existing Exercise Price, by (b) the total number
of shares of Common Stock outstanding immediately after such event, and the
resulting quotient shall be the adjusted Exercise Price per share. No adjustment
of the Exercise Price shall be made if the amount of such adjustment shall be
less than $.05 per share, but in such case any adjustment that would otherwise
be required then to be made shall be carried forward and shall be made at the
time and together with the next subsequent adjustment which, together with any
adjustment or adjustments so carried forward, shall amount to not less than $.05
per share.
(b) Adjustment of Number of Shares Purchasable on Exercise of
Warrants. Upon each adjustment of the Exercise Price pursuant to this Section,
the Holder shall thereafter (until another such adjustment) be entitled to
purchase at the adjusted Exercise Price the number of shares, calculated to the
nearest full share, obtained by multiplying the number of shares specified in
such Warrant (as adjusted as a result of all adjustments in the Exercise Price
in effect prior to such adjustment) by the Exercise Price in effect prior to
such adjustment and dividing the product so obtained by the adjusted Exercise
Price.
(c) Notice as to Adjustment. Upon any adjustment of the
Exercise Price and any increase or decrease in the number of shares of Common
Stock purchasable upon the exercise of the Warrant, then, and in each such case,
the Company within thirty (30) days thereafter shall give written notice
thereof, by first class mail, postage prepaid, addressed to each Holder as shown
on the books of the Company, which notice shall state the adjusted Exercise
Price and the increased or decreased number of shares purchasable upon the
exercise of the Warrants, and shall set forth in reasonable detail the method of
calculation and the facts upon which such calculation is based.
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(d) Effect of Reorganization, Reclassification, Merger, etc.
If at any time while this Warrant is outstanding there should be (i) any capital
reorganization of the capital stock of the Company (other than the issuance of
any shares of Common Stock in subdivision of outstanding shares of Common Stock
by reclassification or otherwise and other than a combination of shares provided
for in Section 4(a) hereof), (ii) any consolidation or merger of the Company
with another corporation, or any sale, conveyance, lease or other transfer by
the Company of all or substantially all of its property to any other
corporation, which is effected in such a manner that the holders of Common Stock
shall be entitled to receive cash, stock, securities, or assets with respect to
or in exchange for Common Stock, or (iii) any dividend or any other distribution
upon any class of stock of the Company payable in stock of the Company of a
different class, other securities of the Company, or other property of the
Company (other than cash), then, as a part of such transaction, lawful provision
shall be made so that Holder shall have the right thereafter to receive, upon
the exercise hereof, the number of shares of stock or other securities or
property of the Company, or of the successor corporation resulting from such
consolidation or merger, or of the corporation to which the property of the
Company has been sold, conveyed, leased or otherwise transferred, as the case
may be, which the Holder would have been entitled to receive upon such capital
reorganization, reclassification of capital stock, consolidation, merger, sale,
conveyance, lease or other transfer, if this Warrant had been exercised
immediately prior to such capital reorganization, reclassification of capital
stock, consolidation, merger, sale, conveyance, lease or other transfer. In any
such case, appropriate adjustments (as determined by the Board of Directors of
the Company) shall be made in the application of the provisions set forth in
this Warrant (including the adjustment of the Exercise Price and the number of
Shares issuable upon the exercise of the Warrant) to the end that the provisions
set forth herein shall thereafter be applicable, as near as reasonably may be,
in relation to any shares or other property thereafter deliverable upon the
exercise of the Warrant as if the Warrant had been exercised immediately prior
to such capital reorganization, reclassification of capital stock, such
consolidation, merger, sale, conveyance, lease or other transfer and the Holder
had carried out the terms of the exchange as provided for by such capital
reorganization, consolidation or merger. The Company shall not effect any such
capital reorganization, consolidation, merger or transfer unless, upon or prior
to the consummation thereof, the successor corporation or the corporation to
which the property of the Company has been sold, conveyed, leased or otherwise
transferred shall assume by written instrument the obligation to deliver to the
Holder such shares of stock, securities, cash or property as in accordance with
the foregoing provisions such Holder shall be entitled to purchase.
5. No Rights as Shareholder. This Warrant shall not entitle the Holder
as such to any voting rights or other rights as a shareholder of the Company.
6. Governing Law. This Warrant shall be governed by and construed in
accordance with the laws of the State of Minnesota.
7. Amendments and Waivers. The provisions of this Warrant may not be
amended, modified or supplemented, and waiver or consents to departures from the
provisions hereof may not be given, unless the Company agrees in writing and has
obtained the written consent of the Holder.
8. Notices. All notices or communications hereunder, except as herein
otherwise specifically provided, shall be in writing and if sent to the Holder
shall be mailed, delivered, or telefaxed and confirmed to the Holder at his or
her address set forth on the records of the Company; or if sent to the Company
shall be mailed, delivered, or telefaxed and confirmed to Wits Basin Precious
Minerals Inc., 000 Xxxxxxxx Xxxx, Xxxxx 0000, Xxxxxxxxxxx, Xxxxxxxxx 00000,
facsimile number (000) 000-0000, or to such other address as the Company or the
Holder shall notify the other as provided in this Section.
IN WITNESS WHEREOF, Wits Basin Precious Minerals Inc. has caused this
Warrant to be signed by its duly authorized officer in the date set forth above.
WITS BASIN PRECIOUS MINERALS INC.
By:_____________________________________
X. Xxxxx White
Chief Executive Officer
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SUBSCRIPTION FORM
To be signed only upon exercise of Warrant.
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, ____________________ of the shares of Common Stock of Wits
Basin Precious Minerals Inc. (the "Shares") to which such Warrant relates and
herewith makes payment of $_____________ therefor in cash, certified check or
bank draft and requests that a certificate evidencing the Shares be delivered
to, ____________________________, the address for whom is set forth below the
signature of the undersigned:
Dated: ____________________
(Signature)
(Address)
[ ] [ ] [ ]
ASSIGNMENT FORM
To be signed only upon authorized transfer of Warrant.
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and
transfers unto _____________________________________ the right to
purchase shares of Common Stock of Wits Basin Precious Minerals Inc. to
which the within Warrant relates and appoints ____________________
attorney, to transfer said right on the books of _________________ with
full power of substitution in the premises.
Dated: ____________________
------------------------------------
(Signature)
------------------------------------
(Address)
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