EXHIBIT 10.14
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AGREEMENT
Agreement made as of April 9, 2006, by and among Empire Gold Corp.
("Empire") and Saddle River Associates, Inc. ("Saddle River").
Introduction
Empire desires to retain Saddle River to find a Qualified Acquisition
Partner as hereinafter defined; and Saddle River agrees to assist in introducing
prospective Qualified Acquisition Partner candidates to Empire and to assist
Empire in the business aspects of any such transaction.
Agreement
1. For purposes of this agreement the following terms shall have the
meanings set forth below:
"Qualified Acquisition Partner" shall be a corporation not conducting business,
not a party to any contact, agreement or lease and without any liabilities which
has over 200 shareholders who meet the holding period requirements under. Rule
144 promulgated under the Securities Act of 1933 (the "Act").
"Transaction" shall refer to any transaction pursuant to which the shares of
Empire are acquired by a Qualified Acquisition Partner and the shareholders of
Empire will own 85% of the outstanding shares of the Qualified Acquisition
Partner on a fully diluted basis.
2. Empire agrees to pay Saddle River as a partial fee for the services to
be performed hereunder as follows:
i $ 250,000.00 within 30 days of execution of this agreeme
ii If Empire enters into an agreement for a Transaction with a Qualified
Acquisition Partner introduced by Saddle River, an additional fee of
$150,000.00 shall be payable upon receipt by Empire of gross proceeds
totaling in excess of $1,000,000 constituting a portion of the next
round of equity financing consummated by Empire. The fee is payable on
the earlier of 120 days after the agreement is executed or upon
consummation of a Transaction. The fee is payable even if Empire does
not consummates a Transaction.
The fee shall provided in this section and section and section 3 shall be
payable without reduction even if Saddle River is a shareholder of a Qualfied
Acquisition Partner.
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3. Upon the consummation of Empire's next equity financing during the term
hereof (the "Next Financing). For the purposes of this agreement, "Next
Financing" shall mean the offering by the Company of equity or debt securities
which if all sold would result in gross proceeds to the Company of not less than
$3,000,000 ("Required Amount")., When Empire receives gross proceeds pursuant to
the Next Financing of one half the Required Amount Empire shall issue to Saddle
River a stock purchase warrant attached (the "Warrant"), representing the right
to purchase up to 500,000 shares of Empire common stock, $0.001 par value per
share (the "Warrant Shares"). The Warrant shall, unless sootier terminated as
provided therein, have a term of 5 years from the date of issuance and shall be
exercisable at a price equal to $.50 per share subject to adjustment as set
forth in the Warrant. In addition for each additional $1,000,000 of proceeds,
or portion thereof, Saddle River shall receive 100,000 additional Warrants (or
pro rata portion) up to 500,000 warrants.
4. This agreement shall terminate on April 30, 2007 if the agreement for
the Transaction shall not have been executed by a Qualified Acquisition Partner
and Empire; provided, however, either party hereto will have the right to
terminate this agreement by giving written notice at any time if the other party
shall have failed, refused, or been unable to perform any of its obligations
hereunder. Compensation shall survive termination, except as otherwise provided.
5. Nothing herein shall obligate Empire to enter into any agreement for a
any Transaction with a Qualified Acquisition Partner presented to Empire by
Saddle River.
6. Empire agrees that, from and after the date hereof until the expiration
or earlier termination of this agreement, neither Empire nor any of its
directors, officers, shareholders, partners, agents, investment bankers, or
other representatives, shall, directly or indirectly, (a) solicit, initiate or
encourage submission of proposals or offers from any person relating to a
merger, consolidation or business combination with, Empire (a "Acquisition
Proposal"), or (b) participate in any discussions or negotiations regarding or
furnish to any other person any information with respect to or otherwise
cooperate in any way, assist facilitate or encourage any Acquisition Proposal by
any other person.
If Empire, in breach of the provisions herein consummates a transaction covered
by an Acquisition Proposal then Empire hall pay to Saddle River an amount equal
to $750,000.
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7. All notices, demands, requests, consents, approvals or other
communications (each of the foregoing, a "Notice") required or permitted to be
given hereunder or pursuant hereto or that are given with respect to this
Agreement to either/any party hereto shall be in writing and shall be (a) sent
by either registered or certified mail, postage prepaid and return receipt
requested, (b) sent by both facsimile transmission with receipt of transmission
confirmed electronically or by telephone and by regular first class mail, or (e)
sent by reputable overnight courier service with charges prepaid and delivery
confirmed, to the intended recipient at its respective address as set forth
below or such other address given by notice hereby:
If to Saddle River:
Saddle River Associates, Inc 000
Xxxxx Xxxx, Xxxxx 000 Xxxxxxxxxx,
Xxx Xxxx 00000
If to Empire:
Empire Gold Corp.,
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx XX 00000
Any notice delivered or sent as provided above shall be deemed given when so
delivered or sent and shall be deemed received (a) three (3) business days
after being mailed, (b) when sent by facsimile transmission, or (c) one (1)
business day after being sent by courier.
8. Empire shall have no obligation to reimburse Saddle River for
out-of-pocket costs and expenses related to the services to be provided as
described herein.
9. This Agreement represents the entire agreement of the parties and may
not he amended or modified except in writing; provided, the parties have entered
or will enter into separate consulting arrangements which shall not be modified
by this agreement nor shall any such agreement modify this agreement, unless so
stated expressly herein or therein.
10. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York. The sole and exclusive forum for any dispute
arising hereunder shall be the State or Federal Courts situated in New York
County. This Agreement constitutes the full, complete, and final expression of
the parties' understanding with respect to the subject matters set forth herein
and may only be modified in a written agreement executed by the parties hereto.
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IN WITNESS WHEREOF, an authorized representative of each of the parties have
executed this Agreement as of the above date.
Saddle River Associates, Inc.
By /s/
------------------------------------------
Name:
Title: Pres.
Empire Gold Corp.
By: /s/ Pini Xxxxxxx
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Name: Pini Xxxxxxx
Title: President & CEO
-4-
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR THE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. THE SECURITIES EVIDENCED BY THIS CERTIFICATE MAY NOT
BE OFFERED, SOLD OR TRANSFERRED FOR VALUE, DIRECTLY OR INDIRECTLY, IN THE
ABSENCE OF SUCH REGISTRATION UNDER THE ACT AND QUALIFICATION UNDER APPLICABLE
STATE LAWS, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND
QUALIFICATION UNDER APPLICABLE STATE LAWS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED TO THE REASONABLE SATISFACTION OF EMPIRE OIL, INC,
EMPME GOLD CORP.
WARRANT TO PURCHASE SHARES OF COMMON STOCK
Date of Issuance: Certificate No. W-_______
FOR VALUE RECEIVED, Empire Gold Corp., a Nevada corporation (the
"Company"), hereby grants to SADDLE RIVER ASSOCIATES, INC. or its registered
assigns (the Registered Holder") the right to purchase from the Company FIVE
HUNDRED THOUSAND (500,000) shares of Warrant Stock at a price per share of
$0.50, and FIVE HUNDRED THOUSAND (500,000) shares of Warrant Stock at a price
per share of $0.50 (in each instance, as adjusted from time to time hereunder,
the "Exercise Price"). This Warrant is issued pursuant to the terms of that
certain agreement among the Company and the Registered Holder, dated as of
___________________(as amended, supplemented or otherwise modified from time to
time, the "Agreement"). Certain capitalized terms used herein are defined in
Section 3 hereof. The amount and kind of securities obtainable pursuant to the
rights granted hereunder and the purchase price for such securities are subject
to adjustment pursuant to the provisions contained in this Warrant.
This Warrant is subject to the following provisions:
Section I. Exercise of Warrant.
1A.Exercise Period. Subject to paragraph 1B hereof, the Registered Holder
may exercise, in whole or in part (but not as to a fractional share of Warrant
Stock), the purchase rights represented by this Warrant at any time and from
time to tune after the Date of Issuance to and including the second anniversary
of the date thereof (the "Exercise Period").
Exhibit A-1
1B. Exercise Procedure.
(i) This Warrant shall be deemed to have been exercised when the Company
has received all of the following items (the "Exercise Time")
(a) a completed Exercise Agreement, as described in paragraph 1C
below, executed by the Person exercising all or part of the purchase rights
represented by this Warrant (the "Purchaser");
(b) this Warrant; and
(c) a check payable to the Company in an amount equal to the product
of the Exercise Price multiplied by the number of shares of Warrant Stock
being purchased upon such exercise (the "Aggregate Exercise Price").
(ii) Certificates for shares of Warrant Stock purchased upon exercise of
this Warrant shall be delivered by the Company to the Purchaser within five
business days after the date of the Exercise Time. Unless this Warrant has
expired or all of the purchase rights represented hereby have been exercised,
the Company shall prepare a new Warrant, substantially identical hereto,
representing the rights formerly represented by this Warrant which have not
expired or been exercised and shall, within such five-day period, deliver such
new Warrant to the Person designated for delivery in the Exercise Agreement.
(iii) The Warrant Stock issuable upon the exercise of this Warrant shall be
deemed to have been issued to the Purchaser at the Exercise Time, and the
Purchaser shall be deemed for all purposes to have become the record holder of
such Warrant Stock at the Exercise Time.
(iv) The issuance of certificates for shares of Warrant Stock upon exercise
this Warrant shall be made without charge to the Registered Holder or the
Purchaser for any issuance tax in respect thereof or other cost incurred by the
Company in connection with such exercise and the related issuance of shares of
Warrant Stock. Each share of Warrant Stock issuable upon exercise of this
Warrant shall, upon payment of the Exercise Price therefor, be fully paid and
nonassessable and free from all liens and charges with respect to the issuance
thereof.
(v) The Company shall not close its books against the transfer of this
Warrant or of any share of Warrant Stock issued or issuable upon the exercise of
this Warrant in any manner which interferes with the timely exercise of this
Warrant. The Company shall from time to time take all such action as may be
necessary to assure that the par value per share of the unissued Warrant Stock
acquirable upon exercise of this Warrant is at all times equal to or less than
the Exercise Price then in effect.
(vi) Notwithstanding any other provision hereof, if an exercise of any
portion of this Warrant is to be made in connection with a registered public
offering or the sale of the Company, the exercise of any portion of this Warrant
may, at the election of the holder hereof; be conditioned upon the consummation
Exhibit A-2
of the public, offering or the sale of the Company in which case such exercise
shall not be deemed to be effective until the consummation of such transaction.
(vii) The Company shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock, solely for the purpose of
issuance upon the exercise of this Wan-ant, such number of shares of Warrant
Stock issuable upon the exercise of this Warrant. The Company shall take all
such actions as may be necessary to assure that all such shares of Warrant Stock
may be so issued without violation of any applicable law or governmental
regulation or any requirements of any domestic securities exchange upon which
shares of Warrant Stock may be listed (except for official notice of issuance
which shall be immediately delivered by the Company upon each such issuance).
The Company shall not take any action which would cause the number of authorized
but unissued shares of Warrant Stock to be less than the number of such shares
required to be reserved hereunder for issuance upon exercise of this Warrant.
1C. Exercise Agreement. Upon any exercise of o this Warrant, the Exercise
Agreement shall be substantially in the form set forth in Annex I hereto, except
that if the shares of Warrant Stock are not to be issued in the name of the
Person in whose name this Warrant is registered, the Exercise Agreement shall
also state the name of the Person to whom the certificates for the shares of
Warrant Stock are to be issued, and if the number of shares of Warrant Stock to
be issued does not include all the shares of Warrant Stock purchasable
hereunder. it shall also state the name of the Person to whom a new Warrant for
the unexercised portion of the rights hereunder is to be delivered. Such
Exercise Agreement shall be dated the actual date of execution thereof.
1D. Fractional Shares. If a fractional share of Warrant Stock would, but
for the provisions of paragraph IA, be issuable upon exercise of the rights
represented by this Warrant, the Company shall, within five business days after
the date of the Exercise Time, deliver to the Purchaser a check payable to the
Purchaser in lieu of such fractional share in an amount equal to the difference
between the Market Price of such fractional share as of the date of the Exercise
Time and the Exercise Price of such fractional share.
IE. Restrictive Legend. Unless registered under the Securities Act of 1933,
as amended (the "Act"), each certificate for Warrant Stock purchased upon
exercise of this Warrant shall bear a legend as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR APPLICABLE STATE LAW AND
MAY NOT BE OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED PLEDGED OR
HYPOTHECATED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT WITH RESPECT
TO SUCH SECURITIES, OR DELIVERY OF AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER OF THESE SECURITIES THAT SUCH OFFER, SALE OR
TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION OR OTHERWISE IN
COMPLIANCE WITH THE ACT AND APPLICABLE STATE LAW.
Exhibit A-3
Section 2. Adjustment of Exercise Price and Number of Shares. The Exercise
Price shall be subject 1 o adjustment from time to time as provided in this
Section 2, and the number of shares of Warrant Stock obtainable upon exercise of
this Warrant shall be subject to adjustment from time to time as provided in
this Section 2.
2A. Subdivision or Combination of Common Stock. If the Company at any time
subdivides (by any stock split, stock dividend, recapitalization or otherwise)
one or more classes of its outstanding shares of Common Stock into a greater
number of shares, the Exercise Price in effect immediately prior to such
subdivision shall be proportionately reduced and the number of shares of Warrant
Stock obtainable upon exercise of this Warrant shall be proportionately
increased. If the Company at any time combines (by reverse stock split or
otherwise) one or more classes of its outstanding shares or Common Stock into a
smaller number of shares, the Exercise Price in effect immediately prior to such
combination shall be proportionately increased and the number of shares of
Warrant Stock obtainable upon exercise of this Warrant shall be proportionately
decreased.
(b) In case, after the date hereof, there occurs any reclassification or
change of the outstanding securities or there occurs any merger, or share
exchange or other transaction whether by agreement or otherwise, pursuant to
which the holders of the company shares are required to exchange their shares
for other securities, including securities of another entity, then and in each
such case the Holder, upon the exercise hereof at any time after the
consummation of such event shall be entitled to receive, in lieu of common
stock, the stock or other securities or property to which such Holder would have
been entitled upon such consummation if such Holder had converted this warrant
immediately prior thereto.
2B.Notices. Promptly following any adjustment of the Exercise Price, the
Company shall give written notice thereof to the Registered Holder, setting
forth in reasonable detail and certifying the calculation of such adjustment.
Section 3, Definitions. The following terms have meanings set forth below:
"Common Stock" means, collectively, the Company's Common Stock and any
capital stock of any class of the Company hereafter authorized which is not
limited to a fixed sum or percentage of par or stated value in respect to the
rights of the holders thereof to participate in dividends or in the distribution
of assets upon any liquidation, dissolution or winding up of the Company.
"Market Price" means as to any security the average of the closing prices
of such security's sales on all domestic securities exchanges on which such
security may at the time be listed, or, if there have been no sales on any such
exchange on any day, the average of the highest bid and lowest asked prices on
all such exchanges at the end of such day, or, if on any day such security is
not so listed, the average of the representative bid and asked prices quoted in
the NASDAQ System as of 4:00 P.M., New York time, on such day, or, if on any day
such security is not quoted in the NASDAQ System, the average of the highest bid
and lowest asked prices on such day in the domestic over-the-counter market as
reported by the National Quotation Bureau, Incorporated, or any similar
successor organization, in each such case averaged over a period of 21 days
consisting of the day as of which "Market Price" is being determined and the 20
consecutive business days prior to such day; provided that if such security
Exhibit A-4
is listed on any domestic securities exchange the term "business days" as used
in this sentence means business days on which such exchange is open for trading.
If at any time such security is not listed on any domestic securities exchange
or quoted in the NASDAQ System or the domestic over-the-counter market, the
"Market Price" shaft be the fair value thereof determined jointly by the Company
and the Registered Holders; provided that if such parties are unable to reach
agreement within a reasonable period of time, such fair value shall be
determined by an appraiser selected by the Company and approved by the
Registered Holder (such approval not to be unreasonably withheld). The
determination of such appraiser shall be final and binding on the Company and
the Registered Holder, and the fees and expenses of such appraiser shall be paid
by the Company,
"Person" means an individual, a partnership, a joint venture, a
corporation, a limited liability company, a trust, an unincorporated
organization and a government or any department or agency thereof,
"Warrant Stock" means the Company's Common Stock, par value 50.001 per
share.
Other capitalized terms used in this Warrant but not defined herein shall
have the meanings set forth in the Agreement.
Section 4. No Voting Rights; Limitations of Liability. Except as otherwise
set forth in this Warrant, this Warrant shall not entitle the holder hereof to
any voting rights or other rights as a stockholder of the Company. No provision
hereof, in the absence of affirmative action by the Registered Holder to
purchase Warrant Stock, and no enumeration herein of the rights or privileges of
the Registered Holder shall give rise to any liability of such holder for the
Exercise Price of Warrant Stock acquirable by exercise hereof or as a
stockholder of the Company.
Section 5. Transfer Limitation. This Warrant and all rights hereunder shall
not be transferable, or assignable except as provided in the restrictive legend.
Any transferee shall be referred to as a registered Holder or Holder and shall
have their rights hereunder.
Section 6. Warrant Exchangeable for Different Denominations. This Warrant
is exchangeable, upon the surrender hereof by the Registered Holder at the
principal office of the Company, for new Warrants of like tenor representing in
the aggregate the purchase rights hereunder, and each of such new Warrants shall
represent such portion of such rights as is designated by the Registered Holder
at the time of such surrender. The date the Company initially issues this
Warrant shall be deemed to be the "Date of Issuance" hereof regardless of the
number of times new certificates representing the unexpired and exercised rights
formerly represented by this Warrant shall be issued. All Warrants representing
portions of the rights hereunder are referred to herein as the "Warrants."
Section 7. Replacement. Upon receipt of evidence reasonably satisfactory to
the Company (an affidavit of the Registered Holder shall be satisfactory) of the
ownership and the loss, theft, destruction or mutilation of any certificate
evidencing this Warrant, and in the case of any such loss, theft or destruction,
Exhibit A-5
upon receipt of indemnity reasonably satisfactory to the Company (provided that
if the holder is a financial institution or other institutional investor its own
agreement shall be satisfactory), or, in the case of any such mutilation upon
surrender of such certificate, the Company shall (at its expense) execute and
deliver in lieu of such certificate a new certificate of like kind representing
the same rights represented by such lost; stolen, destroyed or mutilated
certificate and dated the date of such lost, stolen, destroyed or mutilated
certificate,
Section 8. Notices. Except as otherwise expressly provided herein, all
notices referred to in this Warrant shall be in writing and shall be delivered
personally or sent by reputable overnight courier service (charges prepaid) and
shaft be deemed to have been given when so delivered or sent (i) to the Company,
at its principal executive offices and (ii) to the Registered Holder of this
Warrant, at such holder's address as it appears in the records or the Company
(unless otherwise indicated by any such holder)
Section 9. Amendment and Waiver. Except as otherwise provided herein, the
provisions of this Warrant may be amended by the Company in any manner that does
not adversely affect the right of the Registered Holder. The provisions of this
Warrant may also be amended and the Company may take any action herein
prohibited, or omit to perfom any act herein required to be performed by it,
only if the Company has obtained the written consent of the Registered Holder,
Section 10. Descriptive Readings; Governing Law. The descriptive headings
of the several Sections and paragraphs of this Warrant are inserted for
convenience only and do not constitute a part of this Warrant. This Warrant
shall be governed by and construed and enforced in accordance with the laws of
the State of New York, without giving effect to its conflicts of laws
principles.
* * * *
BALANCE OF PAGE INTENTIONALLY LEFT BLANK
Exhibit A-6
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed and
attested by its duly authorized officers under its corporate seal and to be
dated the Date of Issuance het vol.
EMPIRE GOLD CORP.
By:_________________________________________
Its_________________________________________
Attest:
__________________________________________
Secretary
ANNEX I
EXERCISE AGREEMENT
Dated:
(To be signed only upon exercise of Warrant)
To:__________________________________
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, __________________________________________________________
(______________________)(10 shares of Common Stock of Empire Oil, Inc. ( the
"Company") and herewith makes payment of _______________________________________
Dollars ($____________________) therefor, and requests that the certificates for
such shares be issued in the name of, and delivered to, whose address is
____________________________________________________________________________.
The undersigned represents that it is acquiring such Common Stock for its
own account for investment and not with a view to or for sale in connection with
any distribution thereof and in order to induce the issuance of such Common
Stock makes to the Company the representation and warranties set forth or the
investment representation statement attached hereto.
DATED:______________________________
(Signature must conform in all respects to, name of Holder as specified OD the
face of the Warrant)
_____________________________________
_____________________________________
______________________________
(1) Insert here the number of shares called for on the face of the Warrant (or,
in the case of a partial exercise, the portion thereof as to which the Warrant
is being exercised), in either case without making any adjustment for additional
Common Stock or any other stock or other securities or property or cash which,
pursuant to the adjustment provisions of the Warrant, may be deliverable upon
exercise.