EXHIBIT 99.2
THIS WARRANT AND THE SHARES OF COMMON STOCK WHICH MAY BE PURCHASED UPON THE
EXERCISE OF THIS WARRANT HAVE BEEN ACQUIRED SOLELY FOR INVESTMENT AND HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY
STATE SECURITIES LAWS. SUCH SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION
THEREFROM UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
RUBY MINING COMPANY
COMMON STOCK PURCHASE WARRANT
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NO. 2002618 VOID JUNE 18, 2007
WARRANT TO PURCHASE SHARES OF COMMON STOCK
THIS CERTIFIES THAT, for value received, XXXXX X. XXXXXX (along with any
permitted transferees pursuant to Section 7, the "Holder") can purchase FIVE
HUNDRED THOUSAND (500,000) shares (as adjusted pursuant to Section 3 hereof) of
the fully paid and nonassessable Common Stock, $0.001 par value per share (each
share, a "Warrant Share"), of Ruby Mining Company, a Colorado corporation (the
"Company"), at an exercise price of $.12 per Warrant Share (the "Exercise
Price") (as adjusted pursuant to Section 3), subject to the provisions and upon
the terms and conditions hereinafter set forth.
1. Method of Exercise; Payment. ---------------------------
(a) Exercise. The Holder can exercise the purchase rights represented
by this Warrant, in whole or in part, by surrendering this Warrant (with the
notice of exercise form attached as Exhibit A, duly executed) at the Company's
principal office, and by paying the Company, by certified, cashier's or other
check acceptable to the Company, an amount equal to the aggregate Exercise Price
of the Warrant Shares being purchased.
(b) Cashless Exercise. The Holder can convert this Warrant (the
"Conversion Right"), in whole or in part, into the number of Warrant Shares
(less the number of Warrant Shares that have been previously exercised or as to
which the Conversion Right has been previously exercised) calculated pursuant to
the following formula by surrendering this Warrant (with the notice of exercise
form attached as Exhibit A, duly executed) at the Company's principal office
specifying the number of Warrant Shares that the Holder desires to purchase:
Y (A - B)
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X = A
where: X = the number of Warrant Shares to be issued to the Holder;
Y = the number of Warrant Shares subject to this
Warrant for which the Conversion Right is
being exercised;
A = the Market Price of the Common Stock (as
defined below) as of the trading day
immediately preceding the date of exercise
of this Warrant; and
B = the Warrant Price
For purposes of this Warrant, the "Market Price of the Common
Stock" will be the closing price per share of the Common Stock of the
Company on the principal national securities exchange on which the
Common Stock of the Company is then listed or admitted to trading or,
if not then listed or traded on any such exchange, on the NASDAQ
National Market System, or if then not listed or traded on such
system, the closing bid price per share on NASDAQ or other
over-the-counter trading market. If at any time such quotations are
not available, the "Market Price of the Common Stock" will be the
highest price per share that the Company could obtain from a willing
buyer (not a current employee or director) for shares of Common Stock
sold by the Company, from authorized but unissued shares, as mutually
determined in good faith by the Board of Directors of the Company and
the Holder, unless the Company will become subject to a merger,
acquisition or other consolidation pursuant to which the Company is
not the surviving party, in which case the "Market Price of the Common
Stock" will be deemed to be the value the holders of the Company's
Common Stock receive for each share of Common Stock pursuant to the
Company's acquisition.
(c) Stock Certificates. In the event of any exercise of the rights
represented by this Warrant, the Company will deliver (i) certificates for the
Warrant Shares so purchased to the Holder within 3 business days and, unless
this Warrant has been fully exercised or has expired, (ii) a new Warrant
representing the Warrant Shares with respect to which this Warrant will not have
been exercised.
2. Stock Fully Paid; Reservation of Shares. All of the Warrant Shares
issuable upon the exercise of the rights represented by this Warrant will, upon
issuance and receipt of the Exercise Price or cashless conversion notification
for such Warrant Shares, be fully paid and nonassessable, and free from all
taxes, liens and charges with respect to that issuance. During the period within
which the rights represented by this Warrant may be exercised, the Company will
at all times have authorized and reserved for issuance sufficient registered and
free trading Warrant Shares to provide for the exercise of the rights
represented by this Warrant.
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3. Adjustments. The number and kind of securities purchasable upon the
exercise of this Warrant and the Exercise Price therefor will be subject to
adjustment from time to time upon the occurrence of certain events, as follows:
(a) Reclassification. In case of any reclassification or change of the
Warrant Shares (other than a change in par value, or as a result of a
subdivision or combination), the Company will execute a new Warrant, providing
that the Holder will have the right to exercise that new Warrant, and procure
upon that exercise and payment of the same aggregate Exercise Price, in lieu of
the Warrant Shares previously issuable upon exercise of this Warrant, the kind
and amount of shares of stock, other securities, money and property receivable
upon that reclassification or change, by a holder of an equivalent number of
shares of Company common stock. That new Warrant will provide for adjustments
that will be equivalent to the adjustments provided for in this Section 3. The
provisions of this subsection 3(a) will similarly apply to successive
reclassifications or changes.
(b) Stock Splits, Dividends and Combinations. In the event that the
Company will at any time subdivide the outstanding shares of Company common
stock or will issue a stock dividend on its outstanding shares of Company common
stock, the number of Warrant Shares issuable upon exercise of this Warrant
immediately prior to such subdivision or to the issuance of that stock dividend
will be proportionately increased, and the Exercise Price will be
proportionately decreased, and in the event that the Company will at any time
combine the outstanding shares of Company common stock, the number of Warrant
Shares issuable upon exercise of this Warrant immediately prior to that
combination will be proportionately decreased, and the Exercise Price will be
proportionately increased, effective at the close of business on the date of
that subdivision, stock dividend or combination, as the case may be.
(c) Reserved.
(d) Consolidation, Merger, or Sale. In the event the Company
consolidates or merges with another corporation (other than a consolidation or
merger in which the Company is the surviving entity and that does not result in
any change in the Warrant Shares), or any sale or other transfer or disposition
by the Company of all or substantially all of its assets to any other
corporation, then the Holder will thereafter, upon exercise of this Warrant, be
entitled to receive the number of Warrant Shares or other securities or property
of the Company, or of the successor corporation resulting from such
consolidation or merger, as the case may be, to which the Holder would have been
entitled upon such consolidation, merger, sale, or other disposition if this
Warrant had been exercised immediately prior to such consolidation, merger,
sale, or other disposition. In any such case, appropriate adjustment will be
made in the application of the provisions set forth in this Warrant with respect
to the rights and interests thereafter of the Holder to the end that the
provisions set forth in this Warrant (including those relating to adjustments of
the Exercise Price and the number of Warrant Shares issuable upon the exercise
of this Warrant) will thereafter be applicable in relation to any shares or
other property thereafter deliverable upon the exercise of this Warrant as if
this Warrant had been exercised immediately prior to such consolidation, merger,
sale, or other disposition and the Holder had carried out the terms of the
exchange as provided for by such consolidation, or merger. The Company will not
effect any such consolidation or merger unless, upon or prior to consummating
it, the successor corporation will assume by written instrument the obligation
to deliver to the Holder such shares
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of stock or other securities, cash, or property as the Holder will be entitled
to purchase in accordance with the foregoing provisions. Notwithstanding any
other provisions of this Warrant, in the event of sale or other disposition of
all or substantially all of the assets of the Company as a part of a plan for
liquidation of the Company, all rights to exercise the Warrant will terminate
upon the earlier of the expiration of the Exercise Period and 60 days after the
Company gives written notice to the Holder that such sale or other disposition
has been consummated.
4. Notice of Adjustments. Whenever the number of Warrant Shares
purchasable under this Warrant or the Exercise Price is adjusted pursuant to
Section 3, the Company will provide notice to the Holder setting forth, in
reasonable detail, the event requiring the adjustment, the amount of the
adjustment, how the adjustment was calculated, and the number and class of
Warrant Shares that may be purchased and the Exercise Price therefor after
giving effect to such adjustment.
5. Representations and Warranties by the Holder. The Holder represents and
warrants to the Company as follows:
(a) This Warrant and the Warrant Shares issuable upon exercise of this
Warrant are being acquired for its own account, for investment and not with a
view to, or for resale in connection with, any distribution or public offering
thereof within the meaning of the Securities Act of 1933 (the "1933 Act"). Upon
exercise of this Warrant, the Holder will, if so requested by the Company,
confirm in writing, in a form satisfactory to the Company, that the Warrant
Shares issuable upon exercise of this Warrant are being acquired for investment
and not with a view toward distribution or resale.
(b) The Holder understands that this Warrant and the Warrant Shares
have not been registered under the Act by reason of their issuance in a
transaction exempt from the registration and prospectus delivery requirements of
the 1933 Act pursuant to Section 4(2) thereof, and that they must be held by the
Holder indefinitely, and that the Holder must therefore bear the economic risk
of such investment indefinitely, unless a subsequent disposition thereof is
registered under the 1933 Act or is exempted from such registration. The Holder
further understands that the Warrant Shares have not been registered under any
applicable state securities laws.
(c) The Holder has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of the
purchase of this Warrant and the Warrant Shares issuable upon exercise of this
Warrant and of protecting its interests in connection therewith.
(d) The Holder is able to bear the economic risk of the purchase of
the Warrant Shares pursuant to the terms of this Warrant.
6. Restrictive Legend.
The Warrant Shares (unless registered under the 0000 Xxx) will be stamped
or imprinted with a legend in substantially the following form:
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THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR
DISTRIBUTION THEREOF, AND HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER THE
SECURITIES ACT OF 1933 AND ANY APPLICABLE SECURITIES LAWS.
7. Restrictions Upon Transfer and Removal of Legend.
(a) The Company need not register a transfer of this Warrant or
Warrant Shares bearing the restrictive legend set forth in Section 6 of this
Warrant unless the conditions specified in that legend are satisfied. The
Company can also instruct its transfer agent not to register the transfer of the
Warrant Shares, unless one of the conditions specified in the legend referred to
in Section 6 of this Warrant is satisfied.
(b) Notwithstanding the provisions of subsection (a) above, the
Company must register a transfer of this Warrant or Warrant Shares without
consideration by the Holder (i) to an affiliate of the Holder, (ii) if the
Holder is a partnership or a limited liability company, to any current and
former constituent partners, members and shareholders, (iii) if the Holder is a
corporation, to a shareholder of such corporation, or to any other corporation
under common control, direct or indirect, with the Holder, or (iv) if the Holder
is an individual, by gift, will or intestate succession to (A) a transferee or
assignee who is a spouse, lineal descendant, father, mother, brother or sister
(each, a "Family Member") of the Holder or (B) to a trust, the beneficiaries of
which are exclusively the Holder and/or Family Members, provided, in each case,
that: (y) the Company is, within a reasonable time after that transfer,
furnished with written notice of the name and address of that transferee or
assignee and the number of Warrant Shares under this Warrant that are being
assigned; and (z) that transferee or assignee agrees in writing to be bound by
and subject to the terms and conditions of this Warrant to the same extent as if
that transferee were the original Holder of this Warrant.
8. Rights of Shareholders. No Holder will be entitled, as a Holder, to vote
or receive dividends or be deemed the holder of the Warrant Shares or any other
securities of the Company that may at any time be issuable on the exercise
hereof for any purpose, nor will anything contained herein be construed to
confer upon the Holder, as a Holder, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or upon any matter
submitted to shareholders at any meeting thereof, or to give or withhold consent
to any corporate action (whether upon any recapitalization, issuance of stock,
reclassification of stock, change of par value, consolidation, merger,
conveyance, or otherwise) or to receive notice of meetings, or to receive
dividends or subscription rights or otherwise until this Warrant will have been
exercised and the Warrant Shares issuable upon the exercise of this Warrrant
will have become deliverable, as provided in this Warrant.
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9. Expiration of Warrant. The terms and provisions of this Warrant will
terminate and expire and this Warrant will no longer be exercisable on the
five-year anniversary of the date hereof.
10. Notices. All notices and other
communications required or permitted hereunder will be in writing, will be
effective when given, and will in any event be deemed to be given upon receipt
or, if earlier, (a) on the date shown on the return receipt, if sent by first
class mail, postage prepaid, return receipt requested, (b) upon delivery, if
delivered by hand, (c) on the date of receipt shown in the courier's
documentation, if sent by Federal Express or similar overnight courier, freight
prepaid or (d) one business day after the business day of facsimile transmission
with confirmation of receipt, if delivered by facsimile transmission with copy
by first class mail, postage prepaid, return receipt requested, and will be
addressed (i) if to the Holder, at 0000 Xxx Xxxxxx Xxxx #000, Xxxxxxx, Xxxxxxx
00000, Attn: Xxxxx X. Xxxxxx, Fax: 000-000-0000, and (ii) if to the Company, at
One Securities Centre, 0000 Xxxxxxxx Xxxx, Xxxxx 000, Xxxxxxx, XX 00000, Attn:
Xx. Xxxxxxx X. Xxxxxxx, Fax: (000) 000-0000, or at such other address as a party
may designate by ten days advance written notice to the other party pursuant to
the provisions above.
11. Governing Law. This Warrant and all rights, obligations and liabilities
arising herein shall be construed and governed by the substantive Law of the
state of Georgia, without giving effect to the principles of conflicts of law
thereof.
12. Interpretation. References to "Section" and "Exhibit" are to the
Sections and Exhibits respectively of this Warrant.
13. Amendment; Integration; Waiver. This Warrant may not be amended without
a written agreement signed by both parties. This Warrant contains the entire
agreement of the parties hereto and supercedes any prior agreements and
understanding of the parties hereto, written or oral, with respect to this
subject matter. No failure or delay by any party in exercising any right, power
or privilege hereunder will operate as a waiver thereof nor will any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided will be cumulative and not exclusive of any rights or remedies provided
by law.
Issued this 18th day of June 2002.
RUBY MINING COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
Chariman and CEO
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EXHIBIT A
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NOTICE OF EXERCISE
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TO: Ruby Mining Company
Suite 304
One Securities Centre
0000 Xxxxxxxx Xxxx
Xxxxxxx, Xx 00000
1. The undersigned hereby elects to purchase __________ Warrant Shares
pursuant to the terms of the attached Warrant.
2. Method of Exercise (Please initial the applicable blank):
___ The undersigned elects to exercise the attached
Warrant by means of a cash payment, and tenders
herewith payment in full for the purchase price of
the shares being purchased, together with all
applicable transfer taxes, if any.
___ The undersigned elects to exercise the attached
Warrant by means of the net exercise provisions of
Section 1(b) of the Warrant.
3. Please issue a certificate or certificates representing said Warrant
Shares in the name of the undersigned or in such other name as is specified
below:
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(Name)
-----------------------------
-----------------------------
(Address)
4. The undersigned hereby represents and warrants that the aforesaid
Warrant Shares are being acquired for the account of the undersigned for
investment and not with a view to, or for resale, in connection with the
distribution thereof, and that the undersigned has no present intention of
distributing or reselling such shares and all representations and warranties of
the undersigned set forth in Section 6 of the attached Warrant are true and
correct as of the date hereof.
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(Signature)
Title:
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(Date)
EXHIBIT B
FORM OF TRANSFER
(To be signed only upon transfer of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto _______________________________________________ the right represented by
the attached Warrant to purchase ____________ Warrant Shares to which the
attached Warrant relates, and appoints ______________ Attorney to transfer such
right on the books of [_____________], with full power of substitution in the
premises.
Dated: ____________________
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(Signature must conform in all
respects to name of Holder as
specified on the face of the Warrant)
(Address)
Signed in the presence of:
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