f8k121109ex10_recoveryengy.htm


     

    Exhibit
10.1

     

     

    
      THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT THERETO UNDER SUCH ACT AND APPLICABLE LAWS OR
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS
NOT REQUIRED.

       

      
        	
                Dated
      December 11, 2009

              	
                Warrant
      to Purchase up to 750,000 Shares of

              
	 
      	
                Common
      Stock (subject to adjustment)

              


      

       

      WARRANT
TO PURCHASE COMMON STOCK

      of

      RECOVERY
ENERGY, INC.

      Void
after November 30, 2014

       

      This
certifies that, for value received, Bel-Car Properties, Inc., or its registered
assigns ("Holder") is entitled,
subject to the terms set forth below, to purchase from RECOVERY ENERGY, INC., a
Nevada corporation (the "Company"), up to
750,000 shares of common stock, par value $0.001 per share, of the Company (the
"Common
Stock"), as constituted on the date hereof (the "Warrant Issue Date"),
upon surrender hereof, at the principal office of the Company referred to below,
with the subscription form attached hereto duly executed, and simultaneous
payment therefor in lawful money of the United States or otherwise as
hereinafter provided, at the Exercise Price as set forth in Section 2 below. The
number and character of such shares of Common Stock and the Exercise Price are
subject to adjustment as provided below. The term "Warrant" as used
herein shall include this Warrant, and any warrants delivered in substitution or
exchange therefor as provided herein.

       

      1. Term of
Warrant.  Subject to the terms and conditions set forth herein,
this Warrant shall be exercisable, in whole or in part, during the term
commencing on the Warrant Issue Date and ending at 5:00 p.m., Mountain Time, on
November 30, 2014, and shall be void thereafter.

       

      2. Exercise
Price.  The exercise price at which this Warrant may be
exercised shall be $3.50 per share (the "Exercise Price"); in
any case, as such Exercise Price may be adjusted from time to time pursuant to
Section 11 hereof.

       

      3. Exercise of
Warrant.

       

      (a) Method of
Exercise.  The purchase rights represented by this Warrant are
exercisable by the Holder in whole or in part, at any time, or from time to time
during the term hereof as described in Section 1 above, by the surrender of this
Warrant and the Notice of Exercise annexed hereto duly completed and executed on
behalf of the Holder, at the principal office of the Company (or such other
office or agency of the Company as it may designate by notice in writing to the
Holder at the address of the Holder appearing on the books of the Company), upon
payment (A) in cash or by check acceptable to the Company, (B) by authorization
in the Exercise Notice to reduce the number of shares of Common Stock issued to
the Holder upon such exercise by a number equal to the aggregate exercise price
divided by the Market Price on the date of exercise, or (C) by a combination of
(A) and (B), of the purchase price of the shares to be
purchased.  "Market Price" means the price per share of the Common
Stock on any date of determination, which shall be:

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      (i)           if
the Common Stock is listed on a U.S. national securities exchange on such date,
the closing sale price or, if no closing sale price is reported, the
last-reported sale price on such date on the U.S. national securities exchange
on which the Common Stock is listed or admitted to trading; or

       

      (ii)           if
the Common Stock is not listed on a U.S. national securities exchange on such
date, or if the closing sale price or last-reported sale price is not obtainable
(even if the Common Stock is listed or admitted to trading on such U.S. national
securities exchange), an average of the last-quoted bid and ask prices in the
over-the-counter market on such date as reported by the OTC Bulletin Board, Pink
Sheets LLC or a similar organization (including any successor thereto);
or

       

      (iii)           if
the Market Price cannot be determined pursuant to either (i) or (ii) above,
determined by the Board of Directors of the Company in its reasonable
judgment.

       

      (b) Issuance of
Shares.  This Warrant shall be deemed to have been exercised
immediately prior to the close of business on the date of its surrender for
exercise as provided above, and the person entitled to receive the shares of
Common Stock issuable upon such exercise shall be treated for all purposes as
the holder of record of such shares as of the close of business on such date. As
promptly as practicable on or after such date and in any event within ten days
thereafter, the Company at its expense shall issue and deliver to the person or
persons entitled to receive the same a certificate or certificates for the
number of shares issuable upon such exercise. In the event that this Warrant is
exercised in part, the Company at its expense will execute and deliver a new
Warrant of like tenor exercisable for the number of shares for which this
Warrant may then be exercised.

       

      4. No Fractional Shares or Scrip.
No fractional shares or scrip representing fractional shares shall be
issued upon the exercise of this Warrant. In lieu of any fractional share to
which the Holder would otherwise be entitled (after aggregating all shares that
are being issued upon such exercise), the Company shall make a cash payment
equal to the Exercise Price multiplied by such fraction or, at the Company's
option, round the number of shares to be issued up to the next whole
number.

       

      5. 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 loss, theft or
destruction, on delivery of an indemnity agreement reasonably satisfactory in
form and substance to the Company or, in the case of mutilation, on surrender
and cancellation of this Warrant, the Company at its expense shall execute and
deliver, in lieu of this Warrant, a new warrant of like tenor and
amount.

       

      
        
           

        

        
          -2-

          
            

          

        

        
           

        

      

       

       

      6. Rights of Stockholders.
Subject to Sections 9 and 11 of this Warrant, the Holder shall not be
entitled to vote or receive dividends or be deemed the holder of Common Stock or
any other securities of the Company that may at any time be issuable on the
exercise hereof for any purpose, nor shall anything contained herein be
construed to confer upon the Holder, as such, 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 stockholders 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, or change of stock to no
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 shall have been exercised as provided herein.

       

      7. Transfer
of Warrant.

       

      (a) Warrant Register. The Company
will maintain a register (the "Warrant Register")
containing the names and addresses of the Holder or Holders.  Any
Holder of this Warrant or any portion thereof may change its address as shown on
the Warrant Register by written notice to the Company requesting such
change.  Any notice or written communication required or permitted to
be given to the Holder may be delivered or given by mail to such Holder as shown
on the Warrant Register and at the address shown on the Warrant
Register.  Until this Warrant is transferred on the Warrant Register
of the Company, the Company may treat the Holder as shown on the Warrant
Register as the absolute owner of this Warrant for all purposes, notwithstanding
any notice to the contrary.

       

      (b) Warrant Agent.  The
Company may, by written notice to the Holder, appoint an agent for the purpose
of maintaining the Warrant Register referred to in Section 7(a) above, issuing
the Common Stock or other securities then issuable upon the exercise of this
Warrant, exchanging this Warrant, replacing this Warrant, or any or all of the
foregoing (the "Warrant
Agent").  Thereafter, any such registration, issuance, exchange
or replacement, as the case may be, shall be made at the office of the Warrant
Agent.

       

      (c) Transferability and Negotiability of
Warrant.  This Warrant may not be transferred or assigned in
whole or in part without compliance with all applicable federal and state
securities laws by the transferor and the transferee (including the delivery of
investment representation letters and legal opinions reasonably satisfactory to
the Company, if such are requested by the Company).  Subject to the
provisions of this Warrant with respect to compliance with the Securities Act of
1933, as amended (the "Act"), title to this
Warrant may be transferred by endorsement (by the Holder executing the
Assignment Form annexed hereto) and delivery in the same manner as a negotiable
instrument transferable by endorsement and delivery.

       

      (d) Exchange of Warrant Upon a
Transfer.  On surrender of this Warrant for exchange, properly
endorsed on the Assignment Form and subject to the provisions of this Warrant
with respect to compliance with the Act and with the limitations on assignments
and transfers contained in this Section 7, the Company at its expense shall
issue to or on the order of the Holder a new warrant or warrants of like tenor,
in the name of the Holder or as the Holder (on payment by the Holder of any
applicable transfer taxes) may direct, for the number of shares issuable upon
exercise hereof.

       

       

      
        
           

        

        
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      (e) Compliance
with Securities Laws.

       

      (i) The
Holder of this Warrant, by acceptance hereof, acknowledges that this Warrant and
the shares of Common Stock to be issued upon exercise hereof are being acquired
for investment, and that the Holder will not offer, sell or otherwise dispose of
this Warrant or any shares of Common Stock to be issued upon exercise hereof
except under circumstances that will not result in a violation of the Act or any
state securities laws.

       

      (ii) This
Warrant and all shares of Common Stock issued upon exercise hereof or conversion
thereof shall be stamped or imprinted with a legend in substantially the
following form (in addition to any legend required by state securities
laws):

       

      THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT THERETO UNDER SUCH ACT AND APPLICABLE LAWS OR
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS
NOT REQUIRED.

       

      8. Reservation of
Stock.  The Company covenants that during the term this Warrant
is exercisable, the Company will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of Common Stock
upon the exercise of this Warrant and, from time to time, will take all steps
necessary to amend its Certificate of Incorporation (the "Certificate") to
provide sufficient reserves of shares of Common Stock issuable upon exercise of
this Warrant.  The Company further covenants that all shares of Common
Stock that may be issued upon the exercise of rights represented by this Warrant
and payment of the Exercise Price, all as set forth herein will be duly and
validly authorized and issued, fully paid and nonassessable and free from all
taxes, liens and charges in respect of the issue thereof (other than taxes in
respect of any transfer occurring contemporaneously therewith).  The
Company agrees that its issuance of this Warrant shall constitute full authority
to its officers who are charged with the duty of executing stock certificates to
execute and issue the necessary certificates for shares of Common Stock upon the
exercise of this Warrant.

       

      9. Notices.

       

      (a) Whenever
the Exercise Price or the shares purchasable hereunder shall be adjusted
pursuant to Section 11 hereof, the Company shall issue a certificate signed by
its Chief Financial Officer 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 Exercise Price and the shares purchasable
hereunder after giving effect to such adjustment, and shall cause a copy of such
certificate to be delivered to the Holder of this Warrant by overnight courier
service.

       

       

      
        
           

        

        
          -4-

          
            

          

        

        
           

        

      

       

      (b) 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 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, or

       

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

       

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

       

      then, and
in each such case, the Company will mail or cause to be sent to the Holder or
Holders a notice specifying, as the case may be, (A) 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 (B)
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, liquidation or winding-up. Such notice shall be delivered at least
ten days prior to the record date specified in (A) above or 20 days prior to the
date specified in (B) above, in each case by overnight courier.

       

      10. Amendments and
Waivers.

       

      (a) Except as
provided in Section 1(b) above and Section 10(b) below, this Warrant, or any
provision hereof, may be amended, waived, discharged or terminated only by a
statement in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought.

       

      (b) Any term
or condition of this Warrant may be amended or waived with the written consent
of the Company and holders of Warrants representing more than two-thirds of the
shares of Common Stock issuable upon the exercise of all then outstanding
Warrants (the "Majority Holders"),
even without the consent of the Holder.  Any amendment effected in
accordance with this Section 10(b) shall be binding upon each holder of any of
the Warrants, each future holder of any of the Warrants, and the Company;
provided, however, that no special consideration or inducement may be given to
any such holder in connection with such consent that is not given ratably to all
such holders, and that such amendment must apply to all such holders equally and
ratably.  The Company shall promptly give notice to all holders of
Warrants of any amendment effected in accordance with this Section
10(b).

       

      (c) No
waivers of, or exceptions to, any term, condition or provision of this Warrant,
in any one or more instances, shall be deemed to be, or construed as, a further
or continuing waiver of any such term, condition or provision.

       

      
        
           

        

        
          -5-

          
            

          

        

        
           

        

      

       

       

       

      11. Adjustments. The Exercise
Price and the shares purchasable hereunder are subject to adjustment from time
to time as follows:

       

      (a) Merger, Reorganization, Sale of
Company, etc.  If at any time while this Warrant is outstanding
and unexpired there shall be (i) a reorganization (other than a combination,
reclassification, exchange or subdivision of shares otherwise provided for
herein), (ii) a merger or consolidation of the Company with or into another
corporation in which the Company is not the surviving entity, or a reverse
merger in which the Company is the surviving entity but the shares of the
Company's capital stock outstanding immediately prior to the merger are
converted or exchanged by virtue of the merger into other property, whether in
the form of securities, cash or otherwise, or (iii) a sale or transfer of the
Company's properties and assets as, or substantially as, an entirety to any
other corporation or other entity, then, as a part of such reorganization,
merger, consolidation, sale or transfer, lawful provision shall be made so that
the holder of this Warrant shall thereafter be entitled to receive upon exercise
of this Warrant, during the period specified herein and upon payment of the
Exercise Price then in effect, the number of shares of stock or other securities
or property of the successor corporation or other entity resulting from such
reorganization, merger, consolidation, merger, sale or transfer that a holder of
the shares deliverable upon exercise of this Warrant would have been entitled to
receive in such reorganization, consolidation, merger, sale or transfer if this
Warrant had been exercised immediately before such reorganization, merger,
consolidation, sale or transfer, all subject to further adjustment as provided
in this Section 11.  The foregoing provision of this Section 11(a)
shall similarly apply to successive reorganizations, consolidations, mergers,
sales and transfers and to the stock or securities of any other corporation or
other entity that are at the time receivable upon the exercise of this
Warrant.  If the per-share consideration payable to the Holder for
shares in connection with any such transaction is in a form other than cash or
marketable securities, then the value of such consideration shall be determined
by the Company's Board of Directors in good faith.  In all events,
appropriate adjustment (as determined in good faith by the Company's Board of
Directors) shall be made in the application of the provisions of this Warrant
with respect to the rights and interests of the Holder after the transaction, to
the end that the provisions of this Warrant shall be applicable after that
event, as near as reasonably may be, in relation to any shares or other property
deliverable after that event upon exercise of this Warrant.

       

      (b) Reclassification,
etc.  If the Company, at any time while this Warrant remains
outstanding and unexpired, by reclassification of securities or otherwise, shall
change any of the securities as to which purchase rights under this Warrant
exist into the same or a different number of securities of any other class or
classes, this Warrant shall thereafter represent the right to acquire such
number and kind of securities as would have been issuable as the result of such
change with respect to the securities that were subject to the purchase rights
under this Warrant immediately prior to such reclassification or other change
and the Exercise Price therefor shall be appropriately adjusted, all subject to
further adjustment as provided in this Section 11.

       

      (c) Split, Subdivision or Combination of
Shares.  If the Company at any time while this Warrant remains
outstanding and unexpired shall split, subdivide or combine the securities as to
which purchase rights under this Warrant exist, into a different number of
securities of the same class, the Exercise Price for such securities shall be
proportionately decreased in the case of a split or subdivision or
proportionately increased in the case of a combination and the number of such
securities shall be proportionately increased in the case of a split or
subdivision or proportionately decreased in the case of a
combination.

       

       

      
        
           

        

        
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      (d) Adjustments for Dividends in Stock
or other Securities or Property.  If while this Warrant remains
outstanding and unexpired, the holders of the securities as to which purchase
rights under this Warrant exist (including without limitation securities into
which such securities may be converted) at the time shall have received, or, on
or after the record date fixed for the determination of eligible stockholders,
shall have become entitled to receive, without payment therefor, other or
additional stock or other securities or property (other than cash) of the
Company by way of dividend, then and in each case, this Warrant shall represent
the right to acquire, in addition to the number of shares of the security
receivable upon exercise of this Warrant, and without payment of any additional
consideration therefor, the amount of such other or additional stock or other
securities or property (other than cash) of the Company that such holder would
hold on the date of such exercise had it been the holder of record of the
security receivable upon exercise of this Warrant (or upon such conversion) on
the date hereof and had thereafter, during the period from the date hereof to
and including the date of such exercise, retained such shares and/or all other
additional stock available by it as aforesaid during such period, giving effect
to all adjustments called for during such period by the provisions of this
Section 11.

       

      (e) Other
Adjustments.  In case any event shall occur as to which the
other provisions of this Section 11 are not strictly applicable but as to which
failure to make any adjustment would not fairly protect the exercise rights
represented by this Section 11 in accordance with the essential intent and
principles hereof then, in each such case, the Majority Holders may appoint a
firm of independent public accountants of recognized national standing
reasonably acceptable to the Company, which shall give their opinion as to the
adjustment, if any, on a basis consistent with the essential intent and
principles established herein, necessary to preserve the exercise rights
represented herein.  Upon receipt of such opinion, the Company will
promptly mail a copy thereof to all holders of Common Warrants and shall make
the adjustments described therein.  The fees and expenses of such
independent public accountants shall be borne by the Company.

       

      (f) Calculations.  All
calculations under this Section 11 shall be made to the nearest four decimal
points.

       

      (g) No Impairment.  The
Company shall not, by amendment of its certificate of incorporation or through
any reorganization, transfer of assets, consolidation, merger, dissolution,
issue or sale of securities or other voluntary action, avoid or seek to avoid
the observance or performance of any of the terms to be observed or performed
hereunder by the Company but will at all times in good faith assist in the
carrying out of all the provisions of this Section 11 and in the taking of all
such action as  may be necessary or appropriate in order to protect
the exercise rights of the Holder against dilution or other
impairment.

       

      (h) Effect on Additional
Shares.  Notwithstanding anything to the contrary herein, the
provisions of this Section 11 shall be applicable to the additional shares of
Common Stock for which this Warrant may become exercisable pursuant to Section
2(b) hereof notwithstanding that the event or circumstance to which this Section
11 applies occurs prior to the applicable increase in shares pursuant to Section
2(b).

       

       

      
        
           

        

        
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      12. Miscellaneous
Provisions.

       

      (a) Saturdays, Sundays and
Holidays.  If the last or appointed day for the taking of any
action or the expiration of any right granted herein shall be a Saturday, Sunday
or legal holiday, then (notwithstanding anything herein to the contrary) such
action may be taken or such right may be exercised on the next succeeding day
that is not a Saturday, Sunday or legal holiday.

       

      (b) Governing
Law.  This Warrant shall be governed by and construed in
accordance with the laws of the State of Nevada applicable to agreements made
and to be performed entirely within such State, without regard to the conflicts
of law principles of such State.

       

      (c) Binding
Effect.  The terms of this Warrant shall be binding upon and
inure to the benefit of the Company and the Holder and their respective
successors and assigns.

       

      * * * *
*

       

       

      
        
           

        

        
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      IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
officers thereunto duly authorized.

       

      
        	 
      	 
      	
                RECOVERY
      ENERGY, INC.

              
	 
      	 
      	
                 

                By:                                                         
                            

                      Jeffrey
      A. Beunier

                      Chief
      Executive Officer

              
	 
      	 
      	 
      


      

       

       

       

      
        
           

        

        
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      NOTICE
OF EXERCISE

       

      (1)           The
undersigned hereby elects to purchase _______ shares of Common Stock of RECOVERY
ENERGY, INC., pursuant to the provisions of Section 3(a) of the attached
Warrant, and tenders herewith payment of the purchase price for such shares in
full.

       

      (2)           Please
issue a certificate or certificates representing said shares of Common Stock in
the name of the undersigned or in such other name as is specified
below:

       

       

                                                                     


      (Name)

       

       

                                                                
   

      (Name)

       

       

      (4)           Please
issue a new Warrant for the unexercised portion of the attached Warrant in the
name of the undersigned or in such other name as is specified
below:

       

                                                                     

      (Name)

       

                       
   


      (Date)                                                   

                                                      
             


      (Signature)

       

       

      
        
           

        

        
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      ASSIGNMENT

       

      FOR VALUE
RECEIVED, the undersigned registered owner of this Warrant hereby sells, assigns
and transfers unto the Assignee named below all of the rights of the undersigned
under the within Warrant, with respect to the number of shares of Common Stock
set forth below:

       

      
        	
                Name
      of Assignee

              	
                Address

              	
                No.
      of Shares

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      


      

      


      and does
hereby irrevocably constitute and appoint ____________________________ Attorney
to make such transfer on the books of RECOVERY ENERGY, INC., maintained for the
purpose, with full power of substitution in the premises.

       

      The
undersigned also represents that, by assignment hereof, the Assignee
acknowledges that this Warrant and the shares of stock to be issued upon
exercise hereof are being acquired for investment, and that the Assignee will
not offer, sell or otherwise dispose of this Warrant or any shares of stock to
be issued upon exercise hereof except under circumstances which will not result
in a violation of the Securities Act of 1933, as amended, or any applicable
state securities laws.

      


      Dated:
_________________________

       

                                                               
         

      Signature
of Holder

      


      


       

      -11-