Ex. 10.3

 

Warrant

 

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS
WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR ANY STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON STOCK ISSUABLE UPON
EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS
WARRANT UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO INCEPTION MINING INC. THAT SUCH REGISTRATION
IS NOT REQUIRED.

 

Right to Purchase Shares of Common Stock of Inception Mining Inc.

 

COMMON STOCK PURCHASE WARRANT #1

 

Warrant Shares: 9,250,000 Issue Date: May 20, 2019

 

Inception Mining Inc., a corporation organized under the laws of the State of
Nevada, hereby certifies that, for value received, ____________________ or its
assigns (the “Holder”), is entitled, subject to the terms set forth below, to
purchase from the Company (as defined herein) at any time after the Issue Date
set forth above for three years following the Issue Date, nine million two
hundred fifty thousand (9,250,000) fully paid and non-assessable shares of
Common Stock (as hereinafter defined) at the applicable Exercise Price per share
(as defined below).

 

As used herein the following terms, unless the context otherwise requires, have
the following respective meanings:

 

The term “Common Stock” includes (i) the Company’s common stock, par value
$0.00001; and (ii) any other securities into which or for which any of the
securities described in the preceding clause may be converted or exchanged
pursuant to a plan of recapitalization, reorganization, merger, sale of assets
or otherwise.

 

The term “Company” shall include Inception Mining Inc., a Nevada corporation,
and any person or entity which shall succeed, or assume the obligations of,
Inception Mining Inc. hereunder.

 

The “Exercise Price” applicable under this Warrant shall be a price per share
equal to $0.40 with respect to 3,750,000 shares, $0.50 with respect to 3,000,000
shares, and $0.60 with respect to 2,500,000 shares of Common Stock.

 

Article I. Exercise of Warrant.

 

Section 1.01 Number of Shares Issuable upon Exercise. From and after the date
hereof, the Holder shall be entitled to receive, upon exercise of this Warrant
in whole or in part, by delivery of an original or fax copy of an exercise
notice in the form attached hereto as Exhibit A (the “Exercise Notice”) along
with payment of the Exercise Price per share, shares of Common Stock of the
Company so long as shares of Common Stock of the Company are available for
issuance. All shares of the Common Stock are immediately exercisable upon the
execution of this Warrant as follows:

 

 1 

   

 

Section 1.02 Company Acknowledgment. The Company will, at the time of the
exercise of this Warrant, upon the request of the Holder hereof acknowledge in
writing its continuing obligation to afford to such Holder any rights to which
such Holder shall continue to be entitled after such exercise in accordance with
the provisions of this Warrant. If the Holder shall fail to make any such
request, such failure shall not affect the continuing obligation of the Company
to afford to such Holder any such rights.

 

Section 1.03 Callability Right by Company. If the mathematical average of the
daily volume weighted average prices of the Common Stock is equal to or above
$0.70 for a period of thirty trading days, then the Company will have the right
(at its sole and absolute discretion) at any time to demand the Holder exercise
this Warrant as set forth herein. If the Company demands the exercise as allowed
in this Section and the Holder does not exercise this Warrant within ten
business days, then this Warrant shall automatically expire.

 

Section 1.04 Trustee for Warrant Holders. In the event that a bank or trust
company shall have been appointed as trustee for the Holder of this Warrant,
such bank or trust company shall have all the powers and duties of a warrant
agent (as described in Section 6 herein) and shall accept, in its own name for
the account of the Company or such successor person as may be entitled thereto,
all amounts otherwise payable to the Company or such successor, as the case may
be, on exercise of this Warrant pursuant to this Section 1.

 

Article II. Procedure for Exercise.

 

Section 2.01 Delivery of Stock Certificates, Etc., on Exercise. The Company
agrees that the shares of Common Stock purchased upon exercise of this Warrant
shall be 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 in accordance herewith. As soon as
practicable after the exercise of this Warrant in full or in part, the Company,
at Holder’s expense, will cause to be issued in the name of and delivered to the
Holder, or as such Holder (upon payment by such Holder of any applicable
transfer taxes) may direct in compliance with applicable securities laws, a
certificate or certificates for the number of duly and validly issued, fully
paid and non-assessable shares of Common Stock to which such Holder shall be
entitled on such exercise so long as such shares of Common Stock are available
for issuance.

 

Section 2.02 Exercise. Payment may be made in cash by wire transfer of
immediately available funds or by certified or official bank check payable to
the order of the Company equal to the applicable aggregate Exercise Price, for
the number of Common Shares specified in the Exercise Notice and the Holder
shall thereupon be entitled to receive the number of duly authorized, validly
issued, fully-paid and non-assessable shares of Common Stock as provided herein.

 

 2 

   

 

Article III. Assignment; Exchange of Warrant. Subject to compliance with
applicable securities laws, this Warrant, and the rights evidenced hereby, may
be transferred by any registered holder hereof (a “Transferor”) in whole or in
part. On the surrender for exchange of this Warrant, with the Transferor’s
endorsement in the form of Exhibit B attached hereto (the “Transferor
Endorsement Form”) and together with evidence reasonably satisfactory to the
Company demonstrating compliance with applicable securities laws, which shall
include, without limitation, the provision of a legal opinion from the
Transferor’s counsel (at the Company’s expense) that such transfer is exempt
from the registration requirements of applicable securities laws, the Company at
its expense (but with payment by the Transferor of any applicable transfer
taxes) will issue and deliver to or on the order of the Transferor thereof a new
Warrant of like tenor, in the name of the Transferor and/or the transferee(s)
specified in such Transferor Endorsement Form (each a “Transferee”), calling in
the aggregate on the face or faces thereof for the number of shares of Common
Stock called for on the face or faces of the Warrant so surrendered by the
Transferor.

 

Article IV. Replacement of Warrant. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of this Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.

 

Article V. Maximum Exercise. Notwithstanding anything herein to the contrary, in
no event shall the Holder be entitled to exercise any portion of this Warrant in
excess of that portion of this Warrant upon exercise of which the sum of (a) the
number of shares of Common Stock beneficially owned by the Holder and its
Affiliates and (b) the number of shares of Common Stock issuable upon the
exercise of the portion of this Warrant with respect to which the determination
of this limitation is being made, would result in beneficial ownership by the
Holder and its Affiliates of any amount greater than 9.99% of the then
outstanding shares of Common Stock. As used herein, the term “Affiliate” means
any person or entity that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with a
person or entity, as such terms are used in and construed under Rule 144 under
the Securities Act. For purposes of the second preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended, and Regulations 13(d)-(g) thereunder. The
limitations set forth herein may be waived in whole or in part, upon sixty-one
(61) days prior written notice from the Holder to the Company.

 

Article VI. Warrant Agent. The Company may, by written notice to the Holder of
the Warrant, appoint an agent for the purpose of issuing Common Stock on the
exercise of this Warrant, exchanging this Warrant, and replacing this Warrant,
or any of the foregoing, and thereafter any such issuance, exchange or
replacement, as the case may be, shall be made at such office by such agent.

 

Article VII. Transfer on the Company’s Books. Until this Warrant is transferred
on the books of the Company, the Company may treat the registered Holder hereof
as the absolute owner hereof for all purposes, notwithstanding any notice to the
contrary.

 

Article VIII. Miscellaneous. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEVADA WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS. ANY ACTION BROUGHT CONCERNING THE TRANSACTIONS CONTEMPLATED BY THIS
WARRANT SHALL BE BROUGHT ONLY IN THE STATE COURTS OF NEVADA OR IN THE FEDERAL
COURTS LOCATED IN THE STATE OF NEVADA; PROVIDED, HOWEVER, THAT THE HOLDER MAY
CHOOSE TO WAIVE THIS PROVISION AND BRING AN ACTION OUTSIDE THE STATE OF NEVADA.
The individuals executing this Warrant on behalf of the Company agree to submit
to the jurisdiction of such courts and waive trial by jury. The prevailing party
shall be entitled to recover from the other party its reasonable attorneys’ fees
and costs. In the event that any provision of this Warrant is invalid or
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of this Warrant.
The headings in this Warrant are for purposes of reference only, and shall not
limit or otherwise affect any of the terms hereof. The invalidity or
unenforceability of any provision hereof shall in no way affect the validity or
enforceability of any other provision hereof. The Company acknowledges that
legal counsel participated in the preparation of this Warrant and, therefore,
stipulates that the rule of construction that ambiguities are to be resolved
against the drafting party shall not be applied in the interpretation of this
Warrant to favor any party against the other party.

 

2

 

 

IN WITNESS WHEREOF, the Company has executed this Warrant as of the date first
written above.

 

  INCEPTION MINING INC.         By: /s/ Trent D’Ambrosio   Name: Trent
D’Ambrosio   Title: Chief Executive Officer

 

 3