EXHIBIT 10.12
NEITHER THIS WARRANT NOR THE WARRANT SHARES ISSUABLE UPON EXERCISE HEREOF HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT") OR ANY OTHER APPLICABLE SECURITIES LAWS IN RELIANCE UPON AN EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER SECURITIES
LAWS. NEITHER THIS WARRANT NOR THE SHARES OF WARRANT STOCK ISSUABLE UPON
EXERCISE HEREOF MAY BE SOLD, PLEDGED, TRANSFERRED, ENCUMBERED OR OTHERWISE
DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR IN A TRANSACTION WHICH IS EXEMPT FROM REGISTRATION UNDER THE
PROVISIONS OF THE SECURITIES ACT.
GREEN MOUNTAIN CAPITAL, INC.
Common Stock Purchase Warrant
(Expiring on the fifth anniversary of the date of issuance hereof)
This is to certify that, for value received and subject to the conditions herein
set forth, Sandgrain Securities, Inc. (the "Warrantholder") is entitled to
purchase, at a price per share of Twenty-five Cents ($0.25) per share, Six
Hundred Thousand (60,000) shares of common stock, par value $0.0001 per share
(the "Common Stock"), of Green Mountain Capital, Inc., a Nevada corporation (the
"Company"), subject to adjustment as provided below (such shares purchasable
upon exercise of this Warrant are herein called the "Warrant Stock"). The amount
per share specified above, as adjusted from time to time pursuant to the
provisions hereinafter set forth, is herein called the "Purchase Price." This
Warrant will be immediately exercisable and may be exercised anytime after its
issuance. In the event of a exercise of this Warrant, the Warrantholder shall
surrender this Warrant to the Company with payment of the Purchase Price,
together with a notice of exercise (the date of such surrender being herein
referred to as the "Date of Exercise"), in which event the Company shall issue
to the Warrantholder the number of shares of Warrant Stock.
1. By acceptance of this Warrant, the Warrantholder agrees, for itself and all
subsequent holders, that prior to making any disposition of this Warrant or any
shares of Warrant Stock, the Warrantholder shall give written notice to the
Company describing briefly the manner in which any such proposed disposition is
to be made; and no such disposition shall be made unless and until (i) the
Company has received an opinion of counsel satisfactory to it to the effect that
no registration under the Securities Act of 1933, as amended (the "Act"), is
required with respect to such disposition; or (ii) a registration statement with
respect to the Warrant or the Warrant Stock has been filed by the Company and
declared effective by the Securities and Exchange Commission (the "Commission").
2. (a) If outstanding shares of the Company's Common Stock shall be subdivided
into a greater number of shares thereof or a dividend in Common Stock shall be
paid in respect of Common Stock, the Purchase Price in effect immediately prior
to such subdivision or at the record date of such dividend shall simultaneously
with the effectiveness of such subdivision or immediately after the record date
of such dividend be proportionately reduced and conversely, if outstanding
shares of Common Stock shall be combined into a smaller number of shares
thereof, the Purchase Price in effect immediately prior to such combination
shall, simultaneously with the effectiveness of such combination, be
proportionately increased. When any adjustment is required to be made in the
Purchase Price, the number of shares of Common Stock purchasable upon the
exercise of this Warrant shall be changed to the number determined by dividing
(i) an amount equal to the number of shares issuable pursuant to the exercise of
this Warrant immediately prior to such adjustment multiplied by the Purchase
Price in effect immediately prior to such adjustment, by (ii) the Purchase Price
in effect immediately after such adjustment.
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(b) If there shall occur any capital reorganization or reclassification of
the Company's Common Stock (other than a change in par value or a subdivision or
combination as provided for in subparagraph (a) above), or any consolidation or
merger of the Company with or into another corporation, or in the case of any
sale, transfer or other disposition to another person, corporation or other
entity of all or substantially all the property, assets, business and good will
of the Company as an entirety, then, as part of any such reorganization,
reclassification, consolidation, merger, sale, transfer or other disposition, as
the case may be, lawful provision shall be made so that the registered owner of
this Warrant shall have the right thereafter to receive upon the exercise hereof
the kind and amount of shares of stock or other securities or property which
said registered owner would have been entitled to receive if, immediately prior
to any such reorganization, reclassification, consolidation, merger, sale,
transfer or other disposition, as the case may be, said registered owner had
held the number of shares of Common Stock which were then purchasable upon the
exercise of this Warrant. In any such case, appropriate adjustment (as
determined by the Board of Directors of the Company) shall be made in the
application of the provisions set forth herein with respect to the rights and
interests thereafter of the registered owner of this Warrant such that the
provisions set forth herein (including provisions with respect to adjustment of
the Purchase Price) shall thereafter be applicable, as nearly as is reasonably
practicable, in relation to any shares of stock or other securities or property
thereafter deliverable upon the exercise of this Warrant.
(c) In case the Company shall declare a dividend upon shares of Common
Stock payable otherwise than out of earnings or earned surplus and otherwise
than in shares of Common Stock or in stock or obligations directly or indirectly
convertible into or exchangeable for Common Stock, the Warrantholder shall, upon
exercise of this Warrant in whole or in part, be entitled to purchase, in
addition to the number of shares of Common Stock deliverable upon such exercise
against payment of the Purchase Price therefor, but without further
consideration, the cash, stock or other securities or property which the holder
of Warrant would have received as dividends (otherwise than out of such earnings
or earned surplus and otherwise than in shares of Common Stock or in such
convertible or exchangeable stock or obligations), if continuously since the
date set forth above such holder (i) had been the holder of record of the number
of shares of Common Stock deliverable upon such exercise and (ii) had retained
all dividends in stock or other securities (other than shares of Common Stock or
such convertible or exchangeable stock or obligations) paid or payable in
respect of said number of shares of Common Stock or in respect of any such stock
or other securities so paid or payable as such dividends. For purposes of this
subparagraph (c), a dividend payable otherwise than in cash shall be considered
to be payable out of earnings or earned surplus and shall be charged in an
amount equal to the fair value of such dividend as determined by the Board of
Directors of the Company.
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(d) In case at any time:
(i) the Company shall pay any cash or stock dividend upon its Common Stock
or make any distribution to the holders of its Common Stock; or
(ii) the Company shall offer for subscription pro rata to the holders of
its Common Stock any additional shares of stock of any class or any other
rights; or
(iii) the Company shall effect any capital reorganization or any
reclassification of or change in the outstanding capital stock of the Company
(other than a stock split, a change in par value, or a change resulting solely
from a subdivision or combination of outstanding shares of Common Stock), or any
consolidation or merger, or any sale, transfer or other disposition of all or
substantially all its property, assets, business and good will as an entirety,
or the liquidation, dissolution or winding up of the Company; or
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(iv) the Company shall declare a dividend upon shares of its Common Stock
payable otherwise than out of earnings or earned surplus or otherwise than in
shares of Common Stock or any stock or obligations directly or indirectly
convertible into or exchangeable for Common Stock;
then, in any such case, the Company shall cause at least fifteen (15) days'
prior notice thereof to be furnished to the Warrantholder at the address of such
holder shown on the books of the Company. Such notice shall also specify the
date on which the books of the Company shall close, or a record be taken, for
such stock dividend, distribution or subscription rights, or the date on which
such reclassification, reorganization, consolidation, merger, sale, transfer,
disposition, liquidation, dissolution, winding up, or dividend, as the case may
be, shall take place, and the date of participation therein by the holders of
Common Stock if any such date is to be fixed, and shall also set forth such
facts with respect thereto as shall be reasonably necessary to indicate the
effect of such action on the rights of the Warrantholder.
(e) When any adjustment is required to be made in the Purchase Price, the
Company shall promptly mail to the Warrantholder a certificate setting forth the
Purchase Price after such adjustment and setting forth a brief statement of the
facts requiring such adjustment. Such certificate shall also set forth the kind
and amount of stock or other securities or property into which this Warrant
shall be exercisable following the occurrence of any of the events specified in
subparagraphs (b) or (c) above.
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(f) The Company shall not be required upon the exercise of this Warrant to
issue any fractional shares, but shall make any adjustment therefor on the basis
of the mean between the closing low bid and closing high asked prices on the
over-the-counter market as reported by the National Association of Securities
Dealers Automated Quotations System or the closing market price on a national
securities exchange on the trading day immediately prior to exercise, whichever
is applicable or, if neither is applicable, then on the basis of the market
value of any such fractional interest as shall be reasonably determined by the
Company.
(g) The Company will, within 120 days after the end of each of its fiscal
years, mail to the registered holder of this Warrant at the address of such
holder shown on the books of the Company a certificate (if the Company has
engaged independent public accountants, such certificate shall be prepared by
such independent public accountants) (i) specifying the Purchase Price in effect
as of the end of such fiscal year and the number of shares of Common Stock, or
the kind and amount of any securities or property other than Common Stock
purchasable by the holder of this Warrant and (ii) setting forth in reasonable
detail the facts requiring any adjustments made during such fiscal year.
3. The Company agrees that (i) a number of shares of Common Stock and other
securities and property sufficient to provide for the exercise of this Warrant
upon the basis hereinbefore set forth shall at all times during the term of
Warrant be reserved for the exercise hereof, and (ii) during the term of this
Warrant, it will keep current in filing any forms and other materials required
to be filed with the Commission pursuant to the Act and the Securities Exchange
Act of 1934, as amended.
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2. 4. (a) Exercise of the purchase rights represented by this Warrant may
be made at any time or times on or after the closing of the offering, and before
the close of business on the Termination Date by the surrender of this Warrant
and the Notice of Exercise Form or Notice of Cashless Exercise Form annexed
hereto duly executed, at the office of the Company (or such other office or
agency of the Company as it may designate by notice in writing to the registered
Warrantholder hereof at the address of such Warrantholder appearing on the books
of the Company) and upon payment of the Exercise Price of the Warrant Stock as
provided herein the Warrantholder shall be entitled to receive a certificate for
the number of Warrant Stock so purchased. Certificates for the shares of Warrant
Stock purchased hereunder shall be delivered to the Warrantholder hereof within
twenty (20) trading days after the date on which this Warrant shall have been
exercised as aforesaid. This Warrant shall be deemed to have been exercised and
such certificate or certificates shall be deemed to have been issued, and the
Warrantholder or any other person so designated to be named therein shall be
deemed to have become a Warrantholder of record of such shares of Warrant Stock
for all purposes, as of the date the Warrant has been exercised by payment to
the Company of the Exercise Price and all taxes required to be paid by the
Warrantholder, if any, pursuant to Section 4 prior to the issuance of such
shares of Warrant Stock, have been paid.
(b) Payment may be made either (i) in cash or by certified or official
bank check payable to the order of the Company equal to the applicable aggregate
Exercise Price, (ii) by delivery of the Warrant, or shares of Common Stock
and/or shares of Warrant Stock receivable upon exercise of the Warrant in
accordance with Section 3(c) below, or (iii) by a combination of any of the
foregoing methods, for the number of shares of Warrant Stock specified in such
Exercise Notice (as such exercise number shall be adjusted to reflect any
adjustment in the total number of shares Warrant Stock issuable to the
Warrantholder per the terms of this Warrant) and the Warrantholder shall
thereupon be entitled to receive the number of duly authorized, validly issued,
fully-paid and non-assessable shares of Common Stock determined as provided
herein.
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(c) Notwithstanding any provisions herein to the contrary, if the Fair
Market Value of one share of Common Stock is greater than the Exercise Price (at
the date of calculation as set forth below), in lieu of exercising this Warrant
for cash, the Warrantholder may elect to receive shares equal to the value (as
determined below) of this Warrant (or the portion thereof being exercised) by
surrender of this Warrant at the principal office of the Company together with
the properly endorsed Notice of Cashless Exercise Form in which event the
Company shall issue to the Warrantholder a number of shares of Warrant Stock
computed using the following formula:
X=Y (A-B)
-----
(A)
Where:
X = the number of shares of Warrant Stock to be issued to the
Warrantholder on such exercise
Y = the number of shares of Warrant Stock purchasable under the Warrant
or, if only a portion of the Warrant is being exercised, the portion
of the Warrant being exercised (at the date of such calculation)
A = the Fair Market Value of one share of the Company's Common Stock (at
the date of such calculation)
B = Exercise Price (as adjusted to the date of such calculation)
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(d) "Fair Market Value" shall mean the average 4:00 PM Eastern Standard Time
closing bid price of the Company's Common Stock as quoted on the Nasdaq OTC:BB,
Pink Sheets or other national market or exchange as reflected on the Bloomberg
quotation system ("Closing Bid") on the three (3) trading days immediately
following the date of receipt of the Notice of Cashless Exercise Form.
(e) Notwithstanding anything herein to the contrary, each certificate for
Warrant Stock issued hereunder shall bear a legend reading substantially as
follows (unless the Company receives an opinion of counsel satisfactory to it
that such a legend is not required in order to assure compliance with the Act).
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS
OF ANY STATE. THESE SHARES MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR
HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT
UNDER SUCH ACT COVERING SUCH SHARES OR THE COMPANY RECEIVES AN
OPINION OF COUNSEL FOR THE HOLDER OF THESE SHARES REASONABLY
SATISFACTORY TO THE COMPANY, STATING THAT SUCH SALE, TRANSFER,
ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND
PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT AND FROM REGISTRATION
OR QUALIFICATION REQUIREMENTS OF APPLICABLE STATE SECURITIES LAWS.
5. All shares of Common Stock or other securities delivered upon the exercise of
this Warrant shall be validly issued, fully paid and nonassessable and the
Company will pay all taxes, if any, in respect of the issuance thereof upon
exercise of this Warrant.
6. (a) Subject to the provisions of Paragraph 1 hereof, this Warrant and all
rights hereunder are transferable on the books of the Company, upon surrender of
this Warrant, with the form of assignment attached hereto duly executed by the
registered holder hereof or by his attorney duly authorized in writing, to the
Company at its principal office hereinabove referred to, and thereupon there
shall be issued in the name of the transferee or transferees, in exchange for
this Warrant, a new warrant or warrants or like tenor and date, representing in
the aggregate the right to subscribe for and purchase the number of shares which
may be subscribed for and purchased hereunder.
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(b) If this Warrant shall be lost, stolen, mutilated or destroyed, the
Company, on such terms as to indemnify or otherwise as it may in its discretion
reasonably impose, shall issue a new warrant of like denomination, tenor and
date as this Warrant so lost, stolen, mutilated or destroyed. Any such new
warrant shall constitute an original contractual obligation of the Company,
whether or not the allegedly lost, stolen, mutilated or destroyed warrant shall
be at any time enforceable by anyone.
(c) The Company may deem and treat the registered holder of this Warrant
as the absolute owner of this Warrant for all purposes and shall not be affected
by any notice to the contrary.
(d) This Warrant, including all the rights and obligations granted to the
Warrantholder hereunder, shall be specifically enforceable against the Company
by the Warrantholder, in addition to and not by way of substitution for, any
other remedies available to the Warrantholder, at law or in equity.
(e) This Warrant, in all events, shall be wholly void and of no effect
after the fifth anniversary of the date of issuance of this Warrant.
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7. The Warrantholder shall not, by virtue of ownership of this Warrant, be
entitled to any rights whatsoever of a shareholder of the Company, but shall,
upon written request to the Company, be entitled to receive quarterly or annual
reports, or any other reports to shareholders of the Company.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed as of
November 14, 2006, by its duly authorized officer.
GREEN MOUNTAIN CAPITAL, INC.
By: /s/ Xxxxxxx Xxxxxxxx
President & Chief Executive Officer
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NOTICE OF EXERCISE
To: Green Mountain Capital, Inc.
(i) The undersigned hereby elects to purchase ________ shares of Common
Stock (the "Warrant Stock"), of Green Mountain Capital, Inc. pursuant to the
terms of the attached Warrant, and tenders herewith payment of the exercise
price in full, together with all applicable transfer taxes, if any.
(ii) Please issue a certificate or certificates representing said shares
of Warrant Stock in the name of the undersigned or in such other name as is
specified below:
________________________________________________________
(Name)
________________________________________________________
(Address)
________________________________________________________
________________________________________________________
Social Security or Tax Identification Number
Dated: _________________________
________________________________________
Signature
________________________________________
Print Name
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NOTICE OF CASHLESS EXERCISE
To: Green Mountain Capital, Inc.
(1) The undersigned hereby elects to purchase the number of shares
of Common Stock (the "Warrant Stock"), of Green Mountain Capital, Inc. as are
purchasable pursuant to the terms the formula set forth in Section 4 of the
attached Warrant, and makes payment therefore in full by surrender and delivery
of this Warrant.
(iii) (2) Please issue a certificate or certificates representing
said shares of Warrant Stock in the name of the undersigned or in such other
name as is specified below:
________________________________________________________
(Name)
________________________________________________________
(Address)
________________________________________________________
________________________________________________________
Social Security or Tax Identification Number
Dated: _________________________
________________________________________
Signature
________________________________________
Print Name
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ASSIGNMENT FORM
(To assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to exercise the warrant.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced
thereby are hereby assigned to ___________________________________________ whose
address is ________________________________________________________________
________________________________________________________________________________
Dated: ________________________
Holder's Signature:
-----------------------------------------------------
Holder's Address:
-----------------------------------------------------
-----------------------------------------------------
Signature Guaranteed:
NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatsoever, and must be guaranteed by a bank or trust company. Officers
of corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing Warrant.
