f10q1209ex10i_volcan.htm


    
      Exhibit
10.1

       

       

      
        	 
      	
                WARRANT

              	 
      
	 	 	 
	
                NO.
      VH-001

              	
                VOLCAN
      HOLDINGS, INC.

              	
                [_____]
      Shares

              
	 
      	 
      	 
      


      

      WARRANT TO PURCHASE COMMON
STOCK

       

      VOID
AFTER 5:30 P.M., EASTERN

      TIME,
ON THE EXPIRATION DATE

       

      THIS
WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT
BE SOLD, PLEDGED, HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED WITHOUT
COMPLIANCE WITH THE REGISTRATION OR QUALIFICATION PROVISIONS OF APPLICABLE
FEDERAL AND STATE SECURITIES LAWS OR APPLICABLE EXEMPTIONS
THEREFROM.

       

      FOR VALUE
RECEIVED, VOLCAN HOLDINGS, INC., a Delaware corporation (the “Company”), hereby
agrees to sell upon the terms and on the conditions hereinafter set forth, but
no later than 5:30 p.m., Eastern Time, on the Expiration Date (as hereinafter
defined) to [______________] or registered
assigns (the “Holder”), under the
terms as hereinafter set forth, [______________] ([______]) fully paid and
non-assessable shares of the Company’s Common Stock, par value $0.001 per share
(the “Warrant
Stock”), at a purchase price of one dollar ($1.00) per share
(the “Warrant
Price”), pursuant to this warrant (this “Warrant”).   The
number of shares of Warrant Stock to be so issued and the Warrant Price are
subject to adjustment in certain events as hereinafter set forth.  The
term “Common
Stock” shall mean, when used herein, unless the context otherwise
requires, the stock and other securities and property at the time receivable
upon the exercise of this Warrant.

       

             1.      
Exercise of
Warrant.

       

      a.   Time of Exercise. The
purchase rights represented by this Warrant may be exercised in whole or in part
from time to time prior to 5:30 p.m., Eastern Time, on [______________]  (the
“Expiration
Date”).

       

      b.   Method of Exercise.
The Holder hereof may exercise this Warrant, in whole or in part, by the
surrender of this Warrant at the address set forth in the Notice of Exercise
attached hereto having then been duly executed by the Holder, and by the payment
to the Company of an amount of consideration therefor equal to the purchase
price in effect on the date of such exercise multiplied by the number of shares
of Warrant Stock with respect to which this Warrant is then being exercised,
payable at such Holder’s election (i) by certified or official bank check or by
wire transfer to an account designated by the Company, (ii) by “cashless
exercise” in accordance with the provisions of subsection (c) of this Section 1,
or (iii) by a combination of the foregoing methods of payment selected by the
Holder of this Warrant.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      c.   Cashless Exercise.
Notwithstanding any provisions herein to the contrary and commencing upon the
earlier of six (6) months following the date of issuance of this Warrant and the
date the Warrant Stock becomes eligible for resale pursuant to Rule 144 under
the Act, if (i) the Per Share Market Value of one share of Common
Stock is greater than the Warrant Price (at the date of calculation as set forth
below) and (ii) a registration statement under the Act providing for the resale
of the Warrant Stock is not then in effect or not effective at any time, in lieu
of exercising this Warrant by payment of cash, the Holder may exercise this
Warrant by a cashless exercise and shall receive the number of shares of Common
Stock equal to an amount (as determined below) by surrender of this Warrant at
the address set forth in the Notice of Exercise attached hereto together with
the properly endorsed Notice of Exercise in which event the Company shall issue
to the Holder a number of shares of Common Stock computed using the following
formula:

       

      
        	 
      	
                X=

              	
                

              
	 
      	 
      	 
      
	
                Where

              	
                X=

              	
                the
      number of shares of Common Stock to be issued to the
    Holder.

              
	 
      	 
      	 
      
	 
      	
                Y=

              	
                the
      number of shares of Common Stock purchasable upon exercise of all of the
      Warrant or, if only a portion of the Warrant is being exercised, the
      portion of the Warrant being exercised.

              
	 
      	 
      	 
      
	 
      	
                A=

              	
                the
      Warrant Price.

              
	 
      	 
      	 
      
	 
      	
                B=

              	
                the
      Per Share Market Value of one share of Common Stock on the business day
      immediately preceding the date of such
election.

              


      

      


      “Independent
Appraiser” means a nationally recognized or major regional investment
banking firm or firm of independent certified public accountants of recognized
standing (which may be the firm that regularly examines the financial statements
of the Company) that is regularly engaged in the business of appraising the
capital stock or assets of corporations or other entities as going concerns, and
which is not affiliated with either the Company or the Holder of any
Warrant.

       

       “Per Share Market
Value” means on any particular date (a) the closing bid price per share
of the Common Stock on such date on any registered national stock exchange on
which the Common Stock is then listed, or if there is no such price on such
date, then the closing bid price on such exchange or quotation system on the
date nearest preceding such date, or (b) if the Common Stock is not listed then
a registered national stock exchange, the closing bid price for a share of
Common Stock in the over-the-counter market, as reported by the OTC Bulletin
Board or in the National Quotation Bureau Incorporated (or similar organization
or agency succeeding to its functions of reporting prices) at the close of
business on such date, or (c) if the Common Stock is not then reported by the
OTC Bulletin Board or the National Quotation Bureau Incorporated (or similar
organization or agency succeeding to its functions of reporting prices), then
the average of the “Pink Sheet” quotes for the five business days preceding such
date of determination, or (d) if the Common Stock is not then publicly traded
the fair market value of a share of Common Stock as determined by an Independent
Appraiser selected in good faith by the Company; and provided, further, that all
determinations of the Per Share Market Value shall be appropriately adjusted for
any stock dividends, stock splits or other similar transactions during such
period. The determination of fair market value by an Independent Appraiser shall
be based upon the fair market value of the Company determined on a going concern
basis as between a willing buyer and a willing seller and taking into account
all relevant factors determinative of value, and shall be final and binding on
all parties. In determining the fair market value of any shares of Common Stock,
no consideration shall be given to any restrictions on transfer of the Common
Stock imposed by agreement or by federal or state securities laws, or to the
existence or absence of, or any limitations on, voting rights.

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      d.   No
fractional shares or scrip representing fractional shares shall be issued upon
the exercise of this Warrant. The Company shall pay cash in lieu of fractions
with respect to the Warrants based upon the fair market value of such fractional
shares of Common Stock (which shall be the closing price of such shares on the
exchange or market on which the Common Stock is then traded) at the time of
exercise of this Warrant.

       

      e.   In the
event of any exercise of the rights represented by this Warrant, a certificate
or certificates for the Warrant Stock so purchased, registered in the name of
the Holder, shall be delivered to the Holder within a reasonable time after such
rights shall have been so exercised. The person or entity in whose name any
certificate for the Warrant Stock is issued upon exercise of the rights
represented by this Warrant shall for all purposes be deemed to have become the
holder of record of such shares immediately prior to the close of business on
the date on which the Warrant was surrendered and payment of the Warrant Price
and any applicable taxes was made, irrespective of the date of delivery of such
certificate, except that, if the date of such surrender and payment is a date
when the stock transfer books of the Company are closed, such person shall be
deemed to have become the holder of such shares at the opening of business on
the next succeeding date on which the stock transfer books are open. The Company
shall pay any and all documentary stamp or similar issue or transfer taxes
payable in respect of the issue or delivery of shares of Common Stock on
exercise of this Warrant.

       

             2.       Disposition of Warrant Stock
and Warrant.

       

      a.   The
Holder hereby acknowledges that this Warrant and any Warrant Stock purchased
pursuant hereto are, as of the date hereof, not registered: (i) under the Act on
the ground that the issuance of this Warrant is exempt from registration under
Section 4(2) of the Act as not involving any public offering or (ii) under any
applicable state securities law because the issuance of this Warrant does not
involve any public offering; and that the Company’s reliance on the Section 4(2)
exemption of the Act and under applicable state securities laws is predicated in
part on the representations hereby made to the Company by the Holder that it is
acquiring this Warrant and will acquire the Warrant Stock for investment for its
own account, with no present intention of dividing its participation with others
or reselling or otherwise distributing the same, subject, nevertheless, to any
requirement of law that the disposition of its property shall at all times be
within its control.

       

      The
Holder hereby agrees that it will not sell or transfer all or any part of this
Warrant and/or Warrant Stock unless and until it shall first have given notice
to the Company describing such sale or transfer and furnished to the Company
either (i) an opinion, reasonably satisfactory to counsel for the Company, of
counsel (skilled in securities matters, selected by the Holder and reasonably
satisfactory to the Company) to the effect that the proposed sale or transfer
may be made without registration under the Act and without registration or
qualification under any state law, or (ii) an interpretative letter from the
Securities and Exchange Commission to the effect that no enforcement action will
be recommended if the proposed sale or transfer is made without registration
under the Act.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      b.   If, at
the time of issuance of the shares issuable upon exercise of this Warrant, no
registration statement is in effect with respect to such shares under applicable
provisions of the Act, the Company may at its election require that the Holder
provide the Company with written reconfirmation of the Holder’s investment
intent and that any stock certificate delivered to the Holder of a surrendered
Warrant shall bear legends reading substantially as follows:

       

      “THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF
THIS CERTIFICATE THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.”

       

      In
addition, so long as the foregoing legend may remain on any stock certificate
delivered to the Holder, the Company may maintain appropriate “stop transfer”
orders with respect to such certificates and the shares represented thereby on
its books and records and with those to whom it may delegate registrar and
transfer functions.

       

             3.       Reservation of
Shares.  The Company hereby agrees that at all times there
shall be reserved for issuance upon the exercise of this Warrant such number of
shares of its Common Stock as shall be required for issuance upon exercise of
this Warrant.  The Company further agrees that all shares which may be
issued upon the exercise of the rights represented by this Warrant will be duly
authorized and will, upon issuance and against payment of the exercise price, be
validly issued, fully paid and non-assessable, free from all taxes, liens,
charges and preemptive rights with respect to the issuance thereof, other than
taxes, if any, in respect of any transfer occurring contemporaneously with such
issuance and other than transfer restrictions imposed by federal and state
securities laws.

       

             4.      
Exchange, Transfer or
Assignment of Warrant.  This Warrant is exchangeable, without
expense, at the option of the Holder, upon presentation and surrender hereof to
the Company or at the office of its stock transfer agent, if any, for other
Warrants of different denominations, entitling the Holder or Holders thereof to
purchase in the aggregate the same number of shares of Common Stock purchasable
hereunder.  Upon surrender of this Warrant to the Company or at the
office of its stock transfer agent, if any, with the Assignment Form annexed
hereto duly executed and funds sufficient to pay any transfer tax, the Company
shall, without charge, execute and deliver a new Warrant in the name of the
assignee named in such instrument of assignment and this Warrant shall promptly
be canceled. This Warrant may be divided or combined with other Warrants that
carry the same rights upon presentation hereof at the office of the Company or
at the office of its stock transfer agent, if any, together with a written
notice specifying the names and denominations in which new Warrants are to be
issued and signed by the Holder hereof.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

             5.      
Capital
Adjustments.  This Warrant is subject to the following further
provisions:

       

      a.   Recapitalization,
Reclassification and Succession.  If any recapitalization
of the Company or reclassification of its Common Stock or any merger or
consolidation of the Company into or with a corporation or other business
entity, or the sale or transfer of all or substantially all of the Company’s
assets or of any successor corporation’s assets to any other corporation or
business entity (any such corporation or other business entity being included
within the meaning of the term “successor corporation”) shall be effected, at
any time while this Warrant remains outstanding and unexpired, then, as a
condition of such recapitalization, reclassification, merger, consolidation,
sale or transfer, lawful and adequate provision shall be made whereby the Holder
of this Warrant thereafter shall have the right to receive upon the exercise
hereof as provided in Section 1 and in lieu of the shares of Common Stock
immediately theretofore issuable upon the exercise of this Warrant, such shares
of capital stock, securities or other property as may be issued or payable with
respect to or in exchange for a number of outstanding shares of Common Stock
equal to the number of shares of Common Stock immediately theretofore issuable
upon the exercise of this Warrant had such recapitalization, reclassification,
merger, consolidation, sale or transfer not taken place, and in each such case,
the terms of this Warrant shall be applicable to the shares of stock or other
securities or property receivable upon the exercise of this Warrant after such
consummation.

       

      b.   Subdivision or Combination
of Shares.  If the Company at any time while this Warrant
remains outstanding and unexpired shall subdivide or combine its Common Stock,
the number of shares of Warrant Stock purchasable upon exercise of this Warrant
and the Warrant Price shall be proportionately adjusted.

       

      c.   Stock Dividends and
Distributions.  If the Company at any time while this Warrant
is outstanding and unexpired shall issue or pay the holders of its Common Stock,
or take a record of the holders of its Common Stock for the purpose of entitling
them to receive, a dividend payable in, or other distribution of, Common Stock,
then (i) the Warrant Price shall be adjusted in accordance with Section 5(d) and
(ii) the number of shares of Warrant Stock purchasable upon exercise of this
Warrant shall be adjusted to the number of shares of Common Stock that the
Holder would have owned immediately following such action had this Warrant been
exercised immediately prior thereto.

       

      d.   Warrant Price
Adjustment.  Except as otherwise provided herein, whenever the
number of shares of Warrant Stock purchasable upon exercise of this Warrant is
adjusted, as herein provided, the Warrant Price payable upon the exercise of
this Warrant shall be adjusted to that price determined by multiplying the
Warrant Price immediately prior to such adjustment by a fraction (i) the
numerator of which shall be the number of shares of Warrant Stock purchasable
upon exercise of this Warrant immediately prior to such adjustment, and (ii) the
denominator of which shall be the number of shares of Warrant Stock purchasable
upon exercise of this Warrant immediately thereafter.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      e.   Certain Shares
Excluded.  The number of shares of Common Stock outstanding at
any given time for purposes of the adjustments set forth in this Section 5 shall
exclude any shares then directly or indirectly held in the treasury of the
Company.

       

      f.   Deferral and Cumulation of
De Minimis Adjustments.  The Company shall not be required to
make any adjustment pursuant to this Section 5 if the amount of such adjustment
would be less than one percent (1%) of the Warrant Price in effect immediately
before the event that would otherwise have given rise to such
adjustment.  In such case, however, any adjustment that would
otherwise have been required to be made shall be made at the time of and
together with the next subsequent adjustment which, together with any adjustment
or adjustments so carried forward, shall amount to not less than one percent
(1%) of the Warrant Price in effect immediately before the event giving rise to
such next subsequent adjustment.

       

      g.   Duration of
Adjustment.  Following each computation or readjustment as
provided in this Section 5, the new adjusted Warrant Price and number of shares
of Warrant Stock purchasable upon exercise of this Warrant shall remain in
effect until a further computation or readjustment thereof is
required.

       

             6.      
Limitation on
Exercises.  The Company shall not effect the exercise of this
Warrant, and the Holder shall not have the right to exercise this Warrant, to
the extent that after giving effect to such exercise, the Holder (together with
such Holder’s affiliates) would beneficially own in excess of 4.99% of the
shares of Common Stock outstanding immediately after giving effect to such
exercise.  For purposes of the foregoing sentence, the aggregate
number of shares of Common Stock beneficially owned by such Holder and its
affiliates shall include the number of shares of Common Stock issuable upon
exercise of this Warrant with respect to which the determination of such
sentence is being made, but shall exclude shares of Common Stock which would be
issuable upon (A) exercise of the remaining, unexercised portion of this Warrant
beneficially owned by such Holder and its affiliates and (B) exercise or
conversion of the unexercised or unconverted portion of any other securities of
the Company beneficially owned by such person and its affiliates (including,
without limitation, any convertible notes or convertible preferred stock or
warrants) subject to a limitation on conversion or exercise analogous to the
limitation contained herein.  Except as set forth in the preceding
sentence, for purposes of this paragraph, beneficial ownership shall be
calculated in accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended.  To the extent that the limitation contained in this
Section 6 applies, the determination of whether this Warrant is exercisable (in
relation to other securities owned by the Holder together with any affiliate)
and of which portion of this Warrant is exercisable shall be in the sole
discretion of the Holder, and the submission of a Notice of Exercise shall be
deemed to be the Holder’s determination of whether this Warrant is exercisable
(in relation to other securities owned by the Holder together with any
affiliate) and of which portion of this Warrant is exercisable, in each case
subject to such aggregate percentage limitation, and the Company shall have no
obligation to verify or confirm the accuracy of the
determination.  For purposes of this Warrant, in determining the
number of outstanding shares of Common Stock, the Holder may rely on the number
of outstanding shares of Common Stock as reflected in (1) the Company's most
recent Form 10-K, Form 10-KSB, Form 10-Q, Form 10-QSB, Current Report on Form
8-K or other public filing with the Securities and Exchange Commission, as the
case may be, (2) a more recent public announcement by the Company or (3) any
other notice by the Company setting forth the number of shares of Common Stock
outstanding.  For any reason at any time, upon the written or oral
request of the Holder, the Company shall within one (1) business day confirm
orally and in writing to the Holder the number of shares of Common Stock then
outstanding.  In any case, the number of outstanding shares of Common
Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Warrant, by the Holder and its
affiliates since the date as of which such number of outstanding shares of
Common Stock was reported.  The restriction described in this Section
6 may be waived, in whole or in part, upon sixty-one (61) days prior notice from
the Holder to the Company to increase such percentage up to 9.99%, but not in
excess of 9.99%.  The provisions of this paragraph shall be construed
and implemented in a manner otherwise than in strict conformity with the terms
of this Section 6 to correct this paragraph (or any portion hereof) which may be
defective or inconsistent with the intended beneficial ownership limitation
herein contained or to make changes or supplements necessary or desirable to
properly give effect to such limitation.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

             7.      
Redemption. This
Warrant may be redeemed prior to the Expiration Date, at the option of the
Company, at a price of $0.001 per share of Warrant Stock (“Redemption Price”),
upon not less than 10 days prior written notice to the Holder notifying the
Holder of the Company’s intent to exercise such right and setting forth a time
and date for such redemption; provided, however, that no redemption under this
Section 7 may occur unless the Company’s Common Stock has had a closing sales
price greater than $3.00 per share, as adjusted for any stock splits, stock
combinations, stock dividends and other similar events, for thirty (30)
consecutive trading days. This Warrant may be exercised by Holder at any time
after notice of redemption has been given by the Company and prior to the time
and date fixed for redemption. On and after the redemption date, the Holder
shall have no further rights except to receive, upon surrender of this Warrant,
the Redemption Price.

       

             8.      
Notice to
Holders.

       

      a.   Notice of Record
Date.  In case:

       

      (i)   the
Company shall take a record of the holders of its Common Stock (or other stock
or securities at the time receivable upon the exercise of this Warrant) for the
purpose of entitling them to receive any dividend (other than a cash dividend
payable out of earned surplus of the Company) or other distribution, or any
right to subscribe for or purchase any shares of stock of any class or any other
securities, or to receive any other right;

       

      (ii)   of any
capital reorganization of the Company, any reclassification of the capital stock
of the Company, any consolidation with or merger of the Company into another
corporation, or any conveyance of all or substantially all of the assets of the
Company to another corporation; or

       

      (iii)   of any
voluntary dissolution, liquidation or winding-up of the Company;

       

      then, and
in each such case, the Company will mail or cause to be mailed to the Holder
hereof at the time outstanding a notice specifying, as the case may be, (i) the
date on which a record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such dividend,
distribution or right, or (ii) the date on which such reorganization,
reclassification, consolidation, merger, conveyance, dissolution, liquidation or
winding-up is to take place, and the time, if any, is to be fixed, as of which
the holders of record of Common Stock (or such stock or securities at the
time receivable upon the exercise of this Warrant) shall be entitled to exchange
their shares of Common Stock (or such other stock or securities) for securities
or other property deliverable upon such reorganization, reclassification,
consolidation, merger, conveyance, dissolution or winding-up.  Such
notice shall be mailed at least thirty (30) days prior to the record date
therein specified, or if no record date shall have been specified therein, at
least thirty (30) days prior to such specified date, provided, however, failure
to provide any such notice shall not affect the validity of such
transaction.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      b.   Certificate of
Adjustment. Whenever any adjustment shall be made pursuant to Section 5
hereof, the Company shall promptly make a certificate signed by its Chairman,
Chief Executive Officer, President, Vice President, Chief Financial Officer or
Treasurer, setting forth in reasonable detail the event requiring the
adjustment, the amount of the adjustment, the method by which such adjustment
was calculated and the Warrant Price and number of shares of Warrant Stock
purchasable upon exercise of this Warrant after giving effect to such
adjustment, and shall promptly cause copies of such certificates to be mailed
(by first class mail, postage prepaid) to the Holder of this
Warrant.

      
       9.     Loss, Theft, Destruction or
Mutilation.  Upon receipt by the Company of evidence
satisfactory to it, in the exercise of its reasonable discretion, of the
ownership and the loss, theft, destruction or mutilation of this Warrant and, in
the case of loss, theft or destruction, of indemnity reasonably satisfactory to
the Company and, in the case of mutilation, upon surrender and cancellation
thereof, the Company will execute and deliver in lieu thereof, without expense
to the Holder, a new Warrant of like tenor dated the date hereof.

       

             10.   Warrant Holder Not a
Stockholder.  The Holder of this Warrant, as such, shall not be
entitled by reason of this Warrant to any rights whatsoever as a stockholder of
the Company.

       

             11.   Notices.  Any
notice required or contemplated by this Warrant shall be deemed to have been
duly given if transmitted by registered or certified mail, return receipt
requested, or nationally recognized overnight delivery service, to the Company at its
principal executive offices located at Level 34, 50 Bridge Street, Sydney, New
South Wales 2000, Australia, Attention: Chief Executive Officer, or to the
Holder at the name and address set forth in the Warrant Register maintained by
the Company.

       

             12.   Choice of
Law.  THIS WARRANT IS ISSUED UNDER AND SHALL FOR ALL PURPOSES
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE
OF NEW YORK, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF
LAW.

       

             13.   Jurisdiction and
Venue.  The Company and Holder hereby agree that any dispute
which may arise between them arising out of or in connection with this Warrant
shall be adjudicated before a court located in New York County, New York and
they hereby submit to the exclusive jurisdiction of the federal and state courts
of the State of York located in New York County with respect to any action or
legal proceeding commenced by any party, and irrevocably waive any objection
they now or hereafter may have respecting the venue of any such action or
proceeding brought in such a court or respecting the fact that such court is an
inconvenient forum, relating to or arising out of this Warrant or any acts or
omissions relating to the sale of the securities hereunder, and consent to the
service of process in any such action or legal proceeding by means of registered
or certified mail, return receipt requested, in care of the address set forth
herein or such other address as either party shall furnish in writing to the
other.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      IN
WITNESS WHEREOF, the Company has duly caused this Warrant to be signed on its
behalf, in its corporate name and by its duly authorized officers, as of this
[_____] day of [_________________].

       

       

      VOLCAN HOLDINGS, INC.

       

      By:_______________________________

             Name:

             Title:

       

       

       

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

       

      NOTICE
OF EXERCISE

       

      
        	
                TO:

              	
                Volcan
      Holdings, Inc.

              


      

      
        	
                 
      

              	
                Level
      34

              


      

      
        	
                 
      

              	
                50
      Bridge Street

              


      

      
        	
                 
      

              	
                Sydney,
      New South Wales 2000

              


      

      
        	
                 
      

              	
                Australia

              


      

      
        	
                 
      

              	
                Attn:
      President

              


      

      
        	
                 
      

              	
                Tel:
      +61-2-8216-0777

              


      

       

      The
undersigned, pursuant to the provisions of the foregoing  Warrant,
hereby elects to purchase _______________ shares of common stock of Volcan
Holdings, Inc. (the “Company”) covered by the Warrant.

       

      
        	 	Name of Investing
      Entity:   __________________________________________   
	 	 
	 	Address of Investing
      Entity:  __________________________________________
	 	 
	 	Signature of
      Authorized Signatory of Investing:
      __________________________________________
	 	 
	 	Entity:   __________________________________________   
	 	 
	 	Name and Title of
      Authorized
      Signatory:  __________________________________________
	 	 
	 	Date:  __________________________________________


      

       

      Number of
shares of Common Stock beneficially owned or deemed beneficially owned by the
Holder on the date of exercise: ___________________________

       

      The
undersigned is an “accredited investor” as defined in Regulation D under the
Securities Act of 1933, as amended.

       

      The
undersigned intends that payment of the Warrant Price shall be made as (check
one):

       

      Cash
Exercise                      o

       

      Cashless
Exercise               o

       

      If the
Holder has elected a Cash Exercise, the Holder shall pay the sum of
$______________ by certified or official bank check (or via wire transfer) to
the Company in accordance with the terms of the Warrant.

       

      If the
Holder has elected a Cashless Exercise, a certificate shall be issued to the
Holder for the number of shares equal to the whole number portion of the product
of the calculation set forth below, which is _______________. The Company shall
pay a cash adjustment in respect of the fractional portion of the product of the
calculation set forth below in an amount equal to the product of the fractional
portion of such product and the Per Share Market Value on the date of exercise,
which product is _____________ .

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
      

       

      
        
          	X=	 


        
       

      Where:

       

      The
number of shares of Common Stock to be issued to the Holder
_________________  (“X”).

       

      The
number of shares of Common Stock purchasable upon exercise of all of the Warrant
or, if only a portion of the Warrant is being exercised, the portion of the
Warrant being exercised _______________________ (“Y”).

       

      The
Warrant Price ___________________ (“A”).

       

      The Per
Share Market Value of one share of Common Stock ______________________
(“B”).

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      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, all of or   shares of the
foregoing Warrant and all rights evidenced thereby are hereby assigned
to

       

                                                                            
whose address is

      


      


        Dated:           

       

      Holder’s
Name: __________________________________________                                                    

       

      Holder’s
Signature:   __________________________________________                                                                                                                                       

       

      Name and
Title of
Signatory:  __________________________________________                                                                                                                                        

       

      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.