Warrant to purchase Series D preferred stock -Diamond Alternative Energy



 Exhibit 4.12 
 THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF APPLICABLE STATES. THESE
SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION UNDER SUCH LAWS OR AN EXEMPTION FROM SUCH
REGISTRATION REQUIREMENT. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ALL APPLICABLE STATE SECURITIES LAWS. 
 WARRANT TO PURCHASE STOCK 
  

			
	No. D-34	  	January 7, 2011

 THIS CERTIFIES THAT, for value
received, Diamond Alternative Energy, LLC, with its principal office at One Valero Way, San Antonio, Texas 78249, or its assigns (the “Holder”), is entitled to subscribe for and purchase from MASCOMA
CORPORATION, a Delaware corporation (the “Company”), with its principal office at 67 Etna Road, Suite 300, Lebanon, NH 03766, 1,333,333 shares of the Company’s Series D Preferred Stock (the
“Shares”) at the Exercise Price (as defined below). 
 This Warrant is being issued pursuant to the
terms of the Series D Preferred Stock and Warrant Purchase Agreement, dated as of the date hereof, by and between the Company and the Holder (the “Purchase Agreement”). Capitalized terms not otherwise defined herein shall
have the meaning given to such terms in the Purchase Agreement. 
 1. DEFINITIONS. As used herein, the
following terms shall have the following respective meanings: 
 (a) “Exercise Period” shall mean
the period commencing on the date hereof and ending thirty (30) days after the first to occur of (i) the closing by Frontier Kinross, LLC of at least $150 million in project debt financing for the development of a 40 MMgal/year nameplate
capacity cellulosic ethanol plant located in Kinross, Michigan, using hardwood feedstock, which is anticipated to occur on or about August 31, 2011, or (ii) the closing of the sale of debt and/or equity securities by the Company in a
single transaction or a series of related transactions, occurring after the date hereof, in which the Company receives aggregate gross proceeds of at least $20 million; provided, however, if neither (i) or (ii) occurs prior to the fifth
anniversary of the date hereof, the exercise period shall end of the fifth anniversary of the date hereof. The Company will provide Holder (y) three (3) days prior notice of the closing of the








 
events specified in (i) and (ii), and (z) prompt written notice of the closing of the events specified in (i) and (ii) and all documents necessary to establish such event has
occurred, including all documents reasonably requested by Holder. 
 (b) “Exercise Price” shall
mean $3.75 per share, subject to adjustment pursuant to Section 5 below. 
 2. EXERCISE OF
WARRANT. The rights represented by this Warrant may be exercised in whole or in part at any time during the Exercise Period, by delivery of the following to the Company at its address set forth above (or at such other address as
it may designate by notice in writing to the Holder): 
 (a) An executed Notice of Exercise in the form attached hereto;

 (b) Payment of the Exercise Price either (i) in cash or by check, or (ii) by cancellation of indebtedness;
and 
 (c) This Warrant. 
 Upon the exercise of the rights represented by this Warrant, a certificate or certificates for the Shares so purchased, registered in the name of the Holder or persons affiliated with the Holder, if the
Holder so designates, shall be issued and delivered to the Holder within a reasonable time after the rights represented by this Warrant shall have been so exercised. 
 The person in whose name any certificate or certificates for Shares are to be issued upon exercise of this Warrant shall be deemed to have become the holder of record of such shares on the date on which
this Warrant was surrendered and payment of the Exercise Price was made, irrespective of the date of delivery of such certificate or certificates, 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 close of business on the next succeeding date on which the stock transfer books are open. 

2.1 Net Exercise. Notwithstanding any provisions herein to the contrary, immediately following the closing of the Company’s
first sale of its Common Stock to the public in an offering underwritten by an investment banking firm, pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Act”) (the
“Initial Public Offering”), if the fair market value of one share of the Company’s Common Stock issuable hereunder is greater than the Exercise Price (at the date of calculation as set forth below), in lieu of exercising
this Warrant by payment of cash, the Holder may elect to receive shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company 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 = Y (A-B)
		  	     A

		
	Where X =	  	the number of Shares to be issued to the Holder


  
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	Y =	  	the number of shares of Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date
of such calculation)
		
	A =	  	the fair market value of one share of the Company’s Common Stock purchasable under the Warrant (at the date of such calculation)
		
	B =	  	Exercise Price (as adjusted to the date of such calculation)

 For purposes of the above calculation, the fair market value per share of Common Stock shall be the average of the
closing prices of the Common Stock, on the securities exchange on which such Common Stock is traded following the Initial Public Offering, for five trading days immediately prior to the exercise date. If the Common Stock is traded on other than a
securities exchange, then the fair market value per share of Common Stock shall be determined in good faith by the Company’s Board of Directors. 
 3. COVENANTS OF THE COMPANY. 
 3.1 Covenants as to Shares. The Company covenants and agrees that all Shares that may be issued upon the exercise of the rights represented by this Warrant will, upon issuance, be validly issued
and outstanding, fully paid and nonassessable, and free from all taxes, liens and charges with respect to the issuance thereof. The Company further covenants and agrees that the Company will at all times during the Exercise Period, have authorized
and reserved, free from preemptive rights, a sufficient number of shares of Series D Preferred Stock to provide for the exercise of the rights represented by this Warrant. If at any time during the Exercise Period the number of authorized but
unissued shares of Series D Preferred Stock shall not be sufficient to permit exercise of this Warrant, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of
Series D Preferred Stock to such number of shares as shall be sufficient for such purposes. 
 3.2 No Impairment.
Except and to the extent as waived or consented to by the Holder, the Company will not, by amendment of its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any 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 Warrant 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 impairment. 
 3.3 Notices of Record Date. In the event of any taking by the Company of a record of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to
receive any dividend (other than a cash dividend which is the same as cash dividends paid in previous quarters) or other distribution, the Company shall mail to the Holder, at least ten (10) days prior to the date specified herein, a notice
specifying the date on which any such record is to be taken for the purpose of such dividend or distribution. 
 4.
REPRESENTATIONS OF HOLDER. 

  
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 4.1 Acquisition of Warrant for Personal Account. The Holder represents and warrants
that it is acquiring the Warrant and the Shares solely for its account for investment and not with a view to or for sale or distribution of said Warrant or Shares or any part thereof. The Holder also represents that the entire legal and beneficial
interests of the Warrant and Shares the Holder is acquiring is being acquired for, and will be held for, its account only. The Holder further represents that it is an “Accredited Investor” as defined in Rule 501(a) of Regulation D under
the Securities Act of 1933, as amended (the “Act”). 
 4.2 Securities Are Not Registered.

 (a) The Holder understands that the Warrant and the Shares have not been registered under the Act on the basis that
no distribution or public offering of the stock of the Company is to be effected. The Holder realizes that the basis for the exemption may not be present if, notwithstanding its representations, the Holder has a present intention of acquiring the
securities for a fixed or determinable period in the future, selling (in connection with a distribution or otherwise), granting any participation in, or otherwise distributing the securities. The Holder has no such present intention. 

(b) The Holder recognizes that the Warrant and the Shares must be held indefinitely unless they are subsequently registered under
the Act or an exemption from such registration is available. Except as set forth in the Company’s Registration Rights Agreement, the Holder recognizes that the Company has no obligation to register the Warrant or the Shares of the Company, or
to comply with any exemption from such registration. 
 (c) The Holder is aware that neither the Warrant nor the Shares
may be sold pursuant to Rule 144 adopted under the Act unless certain conditions are met, including, among other things, the existence of a public market for the shares, the availability of certain current public information about the Company, the
resale following the required holding period under Rule 144 and the number of shares being sold during any three month period not exceeding specified limitations. Holder is aware that the conditions for resale set forth in Rule 144 have not been
satisfied and that the Company presently has no plans to satisfy these conditions in the foreseeable future. 
 4.3
Disposition of Warrant and Shares. 
 (a) The Holder further agrees not to make any disposition of all or any part
of the Warrant or Shares in any event unless and until: 
 (i) The Company shall have received a letter secured by the
Holder from the Securities and Exchange Commission stating that no action will be recommended to the Commission with respect to the proposed disposition; 
 (ii) There is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with said registration statement; or 

(iii) The Holder shall have notified the Company of the proposed disposition and shall have furnished the Company with a
reasonably detailed statement 

  
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of the circumstances surrounding the proposed disposition, and if reasonably requested by the Company, the Holder shall have furnished the Company with an opinion of counsel, reasonably
satisfactory to the Company, for the Holder to the effect that such disposition will not require registration of such Warrant or Shares under the Act or any applicable state securities laws. 

(iv) Notwithstanding the provisions of paragraphs (i), (ii) and (iii) above, no such registration statement or opinion
of counsel shall be necessary for a transfer by a Holder that is (A) a partnership transferring to its partners or former partners in accordance with partnership interests or to an affiliate of such partnership, (B) a corporation
transferring to a wholly-owned subsidiary or a parent corporation that owns all of the capital stock, of the Holder, (C) a limited liability company transferring to its members or former members in accordance with their interest in the limited
liability company or to an affiliate of such limited liability company, or (D) an individual transferring to the Holder’s family member or trust for the benefit of an individual Holder; provided that in each case the transferee will
be subject to the terms of this Warrant to the same extent as if it were an original Holder hereunder. 
 (b) The Holder
understands and agrees that all certificates evidencing the shares to be issued to the Holder may bear the following legend: 

“THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE
SECURITIES LAWS OF APPLICABLE STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION
UNDER SUCH LAWS OR AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENT. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN
OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ALL APPLICABLE STATE SECURITIES LAWS.” 

5. Adjustments. Subject to the expiration of this Warrant pursuant to Section 1, the number and kind of shares purchasable
hereunder and the Exercise Price therefor are subject to adjustment from time to time, as follows: 
 (a) Merger
or Reorganization. If at any time there shall be any reorganization, recapitalization, merger or consolidation (other than a merger solely to effect a reincorporation of the Company into another state) (a
“Reorganization”) involving the Company (other than as otherwise provided for herein or as would cause the expiration of this Warrant under Section 1) in which shares of the Company’s stock are converted into or
exchanged for securities, cash or other property, then, as a part of such Reorganization, lawful provision shall be made so that the Holder shall thereafter be entitled to receive upon exercise of this Warrant, the kind and amount of securities,
cash or other property of the successor corporation resulting 

  
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from such Reorganization, equivalent in value to that which a holder of the Shares deliverable upon exercise of this Warrant would have been entitled in such Reorganization if the right to
purchase the Shares hereunder had been exercised immediately prior to such Reorganization, and appropriate adjustment shall be made to the Exercise Price. In any such case, appropriate adjustment (as determined in good faith by the board of
directors of the successor corporation) shall be made in the application of the provisions of this Warrant with respect to the rights and interests of the Holder after such Reorganization to the end that the provisions of this Warrant shall be
applicable after the event, as near as reasonably may be, in relation to any shares or other securities deliverable after that event upon the exercise of this Warrant. The Company will give Holder at least three (3) days prior notice of the
record date for any such Reorganization and at least three (3) days prior notice of the closing of such Reorganization. 

(b) Reclassification of Shares. If the securities issuable upon exercise of this Warrant are
changed into the same or a different number of securities of any other class or classes by reclassification, capital reorganization, conversion of all outstanding shares of the relevant class or series or otherwise (other than as otherwise provided
for herein) (a “Reclassification”), then, in any such event, in lieu of the number of Shares which the Holder would otherwise have been entitled to receive, the Holder shall have the right thereafter to exercise this Warrant
for a number of shares of such other class or classes of stock that a holder of the number of securities deliverable upon exercise of this Warrant immediately before that change would have been entitled to receive in such Reclassification and
appropriate adjustment shall be made to the Exercise Price, all subject to further adjustment as provided herein with respect to such other shares. The Company will give Holder at least three (3) prior notice of the record date for any such
Reclassification and at least three (3) days prior notice of the closing of any such Reclassification. 
 (c)
Subdivisions and Combinations. In the event that the outstanding shares of preferred stock are subdivided (by stock split, by payment of a stock dividend or otherwise) into a greater number of shares of such
securities, the number of Shares issuable upon exercise of the rights under this Warrant immediately prior to such subdivision shall, concurrently with the effectiveness of such subdivision, be proportionately increased, and the Exercise Price shall
be proportionately decreased, and in the event that the outstanding shares of preferred stock are combined (by reclassification or otherwise) into a lesser number of shares of such securities, the number of Shares issuable upon exercise of the
rights under this Warrant immediately prior to such combination shall, concurrently with the effectiveness of such combination, be proportionately decreased, and the Exercise Price shall be proportionately increased. 

(d) Redemption. In the event that all of the outstanding shares of the securities issuable upon exercise of
this Warrant are redeemed in accordance with the Company’s certificate of incorporation, this Warrant shall thereafter be exercisable for a number of shares of the Company’s Common Stock equal to the number of shares of Common Stock that
would have been received if this Warrant had been exercised in full immediately prior to such redemption and the preferred stock received thereupon had been simultaneously converted into Common Stock. The Company will give Holder at least three
(3) prior notice of the record date for any such redemption and at least three (3) days prior notice of the date on which such shares will be redeemed. 

  
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 (e) Notice of Adjustments. Upon any adjustment in accordance
with this Section 5, the Company shall give notice thereof to the Holder, which notice shall state the event giving rise to the adjustment, the Exercise Price as adjusted and the type and number of securities or other property purchasable upon
the exercise of the rights under this Warrant, setting forth in reasonable detail the method of calculation of each. The Company shall, upon the written request of any Holder, furnish or cause to be furnished to such Holder a certificate setting
forth (i) such adjustments, (ii) the Exercise Price at the time in effect and (iii) the type and number of securities and the amount, if any, of other property that at the time would be received upon exercise of this Warrant.

 6. FRACTIONAL SHARES. No fractional shares shall be issued upon the exercise of this
Warrant as a consequence of any adjustment pursuant hereto. All Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for purposes of determining whether the exercise would result in the issuance of any fractional
share. If, after aggregation, the exercise would result in the issuance of a fractional share, the Company shall, in lieu of issuance of any fractional share, pay the Holder otherwise entitled to such fraction a sum in cash equal to the product
resulting from multiplying the then current fair market value of a Share by such fraction. 
 7. NO
STOCKHOLDER RIGHTS. This Warrant in and of itself shall not entitle the Holder to any voting rights or other rights as a stockholder of the Company. 

8. TRANSFER OF WARRANT. Subject to applicable laws and the restriction on transfer
set forth in this Warrant, this Warrant and all rights hereunder are transferable, by the Holder in person or by duly authorized attorney, upon delivery of this Warrant and the form of assignment attached hereto to any transferee designated by
Holder. The transferee shall sign an investment letter in form and substance reasonably satisfactory to the Company. 
 9.
LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost, stolen, mutilated or destroyed, the Company may, on such terms as to indemnity or
otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination and tenor as the 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. 

10. NOTICES, ETC. All notices required or permitted hereunder shall be in writing and shall be
deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed telex, facsimile or electronic mail if sent during normal business hours of the recipient, if not, then on the next business day,
(c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the Company at the address listed on the signature page and to Holder at its address listed on the first page of this Warrant or at such other address as the Company or Holder
may designate by ten (10) days advance written notice to the other parties hereto. 

  
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 11. ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute
acceptance of and agreement to all of the terms and conditions contained herein. 
 12. AMENDMENT
AND WAIVER. Any term of this Warrant may be amended or waived with the written consent of the Company and the Holder. 
 13. GOVERNING LAW. This Warrant and all rights, obligations and liabilities hereunder shall be governed by, and construed and enforced in accordance with, the
substantive laws of the State of Delaware without regard to its principles of conflicts of laws. 
 [SIGNATURE PAGE FOLLOWS]


  
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 IN WITNESS WHEREOF, the
Company has caused this Warrant to be executed by its duly authorized officer as of the date first written above. 
  

			
	MASCOMA CORPORATION
		
	By:	 	 /s/ WILLIAM J. BRADY





			
		
	Name:	 	 WILLIAM J. BRADY





			
		
	Title:	 	 PRESIDENT and CEO





			
	
	DIAMOND ALTERNATIVE ENERGY, LLC


 
			
		
	By:	 	  





			
		
	Name:	 	  





			
		
	Title:	 	  




  

SIGNATURE PAGE TO WARRANT 








 IN WITNESS
WHEREOF, the Company has caused this Warrant to be executed by its duly authorized officer as of the date first written above. 

 

			
	MASCOMA CORPORATION
		
	By:	 	  





			
		
	Name:	 	  





			
		
	Title:	 	  





			
	
	DIAMOND ALTERNATIVE ENERGY, LLC


 
			
		
	By:	 	 /s/ S. Eugene Edwards





			
		
	Name:	 	 S. Eugene Edwards





			
		
	Title:	 	 Executive Vice President

		
		 	







  

SIGNATURE PAGE TO WARRANT 








 NOTICE OF EXERCISE 

(1) The undersigned hereby elects to purchase              shares of
Series D Preferred Stock (the “Shares”) of Mascoma Corporation (the “Company”) 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. 
 (2) Please issue a certificate or certificates representing said shares of the
Shares in the name of the undersigned or in such other name as is specified below: 
  

									
		 		 	  
	 		 	
		 		 	(Name)	 		 	
					
		 		 	  
	 		 	
		 		 	  
	 		 	
		 		 	(Address)	 		 	

 (3) The undersigned represents that (i) the aforesaid Shares are being acquired for the
account of the undersigned for investment and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has no present intention of distributing or reselling such shares; (ii) the undersigned is
aware of the Company’s business affairs and financial condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision regarding its investment in the Company; (iii) the undersigned is
experienced in making investments of this type and has such knowledge and background in financial and business matters that the undersigned is capable of evaluating the merits and risks of this investment and protecting the undersigned’s own
interests; (iv) the undersigned understands that the Shares issuable upon exercise of this Warrant have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), by reason of a specific
exemption from the registration provisions of the Securities Act, which exemption depends upon, among other things, the bona fide nature of the investment intent as expressed herein, and, because such securities have not been registered under the
Securities Act, they must be held indefinitely unless subsequently registered under the Securities Act or an exemption from such registration is available; (v) the undersigned is aware that the aforesaid Shares may not be sold pursuant to Rule
144 adopted under the Securities Act unless certain conditions are met and until the undersigned has held the shares for the number of years prescribed by Rule 144, that among the conditions for use of the Rule is the availability of current
information to the public about the Company and the Company has not made such information available and has no present plans to do so; and (vi) the undersigned agrees not to make any disposition of all or any part of the aforesaid Shares unless
and until there is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is made in accordance with said registration statement, or, if requested by the Company, the undersigned has
provided the Company with an opinion of counsel satisfactory to the Company, stating that such registration is not required. 
  

					
	  
	 		 	  

	(Date)	 		 	(Signature)









					
		 		 	  

		 		 	(Print name)








 ASSIGNMENT FORM 

 

					
		 	(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)	  	

 FOR VALUE RECEIVED, the
foregoing Warrant and all rights evidenced thereby are hereby assigned to 
  

			
	Name:	  	  



			
		  	(Please Print)
		
	Address:	  	  

		  	(Please Print)

  

					
	Dated:	 	                , 20    	  	
			
	Holder’s Signature:	 	  
	  	
			
	Holder’s Address:	 	  
	  	

 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 whatever. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper evidence of authority to assign the foregoing Warrant.