exv10w12



 





Exhibit 10.12



THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS
OF ANY STATE AND ANY SALE, TRANSFER, PLEDGE OR OTHER DISPOSITION THEREOF MAY BE
MADE ONLY (i) IN A REGISTRATION OR QUALIFICATION OR (ii) IF AN EXEMPTION FROM
REGISTRATION OR QUALIFICATION IS AVAILABLE AND THE COMPANY HAS RECEIVED AN
OPINION OF COUNSEL TO THAT EFFECT REASONABLY SATISFACTORY TO THE COMPANY.



Void After 5:00 p.m. Minneapolis, Minnesota time on                     , 2012.




AGASSIZ ENERGY, LLC




MEMBERSHIP UNITS PURCHASE WARRANT




	 	 	 
	Warrant No. CD-00___

	 	Units:






     THIS CERTIFIES that, subject to the terms and conditions herein set forth,                                         or his/her/its registered assigns (the
“Holder”) is entitled to purchase from Agassiz Energy, LLC, a Minnesota limited liability
company (the “Company”), in full or in part commencing on the date that is six months
following the date of the termination of the Company’s final sale of its membership units
sold pursuant to its duly-authorized registered offering under the Company’s Securities Act
of 1933, as amended, Form SB-2 which has been registered with the Securities and Exchange
Commission and no later than the time and date set forth above,                                                             (        
             ) fully paid and
non-assessable Membership Units
of the Company (referred to as the “Units”).



     This Warrant is subject to the following terms and conditions:




	1.	 	Purchase Price. Subject to adjustment as hereinafter provided, the purchase price of
one Unit shall be One Dollar and 00/100 ($1.00). The purchase price of one Unit is referred to
herein as the “Warrant Price.”
	 
	2.	 	Adjustment of Warrant Price and Number of Units. The number and
kind of securities issuable upon the exercise of this Warrant shall be
subject to adjustment from time to time upon the happening of certain
events as follows:






	 	a.	 	Adjustment for Unit Dividends, Splits and Consolidations. In case the
Company shall at any time subdivide the outstanding Membership Units into a greater number
of Units or declare a dividend payable in Membership Units, the Warrant Price in effect
immediately prior to such subdivision shall be proportionately reduced, and conversely, in
case the outstanding Membership Units shall be





 









 











	 	 	 	combined into a smaller number of Units, the Warrant exercise price in effect
immediately prior to such combination shall be proportionately increased.
	 
	 	b.	 	Adjustment for Reorganizations or Consolidations. If any capital
reorganization or reclassification of the Membership Units of the Company, or
consolidation or merger of the Company with another company, or the sale of all or
substantially all of its assets to another company shall be effected in such a way that
holders of Membership Units shall be entitled to receive stock, securities or assets
(“substituted property”) with respect to or in exchange for such Membership Units,
then, as a condition of such reorganization, reclassification, consolidation, merger or
sale, the Holder shall have the right to purchase and receive upon the basis and upon
the terms and conditions specified in this Warrant and in lieu of the Membership Units
of the Company immediately theretofore purchasable and receivable upon the exercise of
the rights represented hereby, such substituted property as would have been issued or
delivered to the Holder if it had exercised this Warrant and had received upon exercise
of this Warrant the Units prior to such reorganization, reclassification,
consolidation, merger or sale, less the amount of the aggregate Warrant Price.






	3.	 	No Unitholder Rights. This Warrant shall not entitle its Holder to any of the rights
of a member of the Company prior to exercise of this Warrant. If the Holder is not already a
member of the Company, the Holder shall be required to execute the Member Control Agreement
of the Company upon exercise of this Warrant prior to being entitled to any of the rights of
a member of the Company.
	 
	4.	 	Covenants of the Company. The Company covenants that during the period this Warrant
is exercisable, the Company will reserve from its authorized and unissued Membership Units a
sufficient number of Membership Units to provide for the issuance of Units upon the exercise
of this Warrant. The Company further covenants that all Units that may be issued upon the
exercise of this Warrant will, upon payment and issuance, be duly authorized and issued,
fully paid and nonassessable Membership Units.
	 
	5.	 	Exercise of Warrant. This Warrant may be exercised by the registered Holder, in
whole or in part, by the surrender of this Warrant at the principal office of the Company,
together with the form of exercise hereof duly executed, accompanied by payment in full of
the amount of the aggregate Warrant Price in cash, cashier’s check or bank draft. Upon
partial exercise hereof, a new warrant or warrants containing the same date and provisions as
this Warrant shall be issued by the Company to the registered Holder for the number of Units
of Membership Units with respect to which this Warrant shall not have been exercised. Upon
each exercise of this Warrant the Holder shall exercise this Warrant and purchase the lesser
of 500 Units and the balance of Units available for issuance under the Warrant. A Warrant
shall be deemed to have been exercised immediately prior to the close of business on the date
the Company is in receipt of this Warrant, written notice of exercise, and payment for the
number of Units being acquired upon exercise of this Warrant. The person entitled to
receive the Units issuable upon





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	 	 	such exercise shall be treated for all purposes as the Holder of such Units of record as of
the close of business on such date.
	 
	6.	 	Compliance with Securities Laws and Other Transfer Restrictions. The Holder
of this Warrant, by acceptance hereof, agrees, represents and warrants that this
Warrant and the Units which may be issued upon exercise hereof are being acquired for
investment, that the Holder has no present intention to resell or otherwise dispose of
all or any part of this Warrant or any Units, and that the Holder will not offer, sell
or otherwise dispose of all or any part of this Warrant or any Units except under
circumstances which will not result in a violation of the Securities Act of 1933, as
amended (the “Act”) or applicable state securities laws. The Company may condition any
transfer, sale, pledge, assignment or other disposition on the receipt from the party
to whom this Warrant is to be so transferred or to whom Units are to be issued or so
transferred, on any representations and agreements requested by the Company in order to
permit such issuance or transfer to be made pursuant to exemptions from registration
under federal and applicable state securities laws. Upon exercise of this Warrant, the
Holder hereof shall, if requested by the Company, confirm in writing its investment
purpose and acceptance of the restrictions on transfer of the Units.
	 
	7.	 	Restrictive Legend. The Holder agrees that the Company may place one or
more restrictive legends on any certificates evidencing the Units, if certificated,
containing substantially the following language:






The securities represented by this certificate have not been registered under the
Securities Act of 1933, as amended and have not been registered under any state
securities law. They may not be sold, offered for sale, or transferred in the
absence of either an effective registration under the Securities Act of 1933, as
amended, and under the applicable state securities laws, or an opinion of counsel
for the Company that such transaction is exempt from registration under the
Securities Act of 1933, as amended, and under the applicable state securities laws.




	8.	 	Six Month Holding Period. The Holder agrees that the exercise of this Warrant is further
restricted for the time period that is six months following the date of the last sale of
the Company’s Membership Units that occurs pursuant to an effective Registration Statement
on Form SB-2 and all amendments thereto. The Company will notify the Holder in writing when
such date has occurred and the date of the end of the six month holding period.
	 
	9.	 	Subdivision of Warrant. At the request of the Holder of this Warrant in connection with
a transfer or exercise of a portion of the Warrant, upon surrender of such Warrant for such
purpose to the Company, the Company at its expense (except for any transfer tax payable)
will issue and exchange therefor warrants of like tenor and date representing in the
aggregate the right to purchase such number of Units as shall be designated by such Holder
at the time of such surrender; provided, however, that the Company’s obligations





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	 	 	to subdivide securities under this Paragraph shall be subject to and conditioned upon the
compliance of any such subdivision with applicable state securities laws and with the Act.
	 
	10.	 	Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of this Warrant, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and upon reimbursement to the Company of all
reasonable expenses incidental thereto, and upon surrender and cancellation of this Warrant,
if mutilated, the Company will make and deliver a new Warrant of like tenor and dates as of
such cancellation, in lieu of this Warrant.
	 
	11.	 	No Limitation on Corporate Action. No provisions of the Warrant and no right or
option granted or conferred hereunder shall in any way limit, affect, or abridge the exercise
by the Company of any of its corporate rights or powers to recapitalize, amend its Articles
of Organization, reorganize or merge with or into another company, or to transfer all or any
part of its property or assets, or the exercise of any other of its rights and powers.
	 
	12.	 	Miscellaneous. This Warrant shall be governed by the laws of the State of Minnesota without
reference to such state’s conflict of laws provisions. The headings in this Warrant are for
purposes of convenience and reference only, and shall not be deemed to constitute a part
hereof. Neither this Warrant nor any term hereof may be changed, waived, discharged or
terminated orally but only by an instrument in writing signed by the Company and the
registered Holder hereof. All notices and other communications from the Company to the Holder
of this Warrant shall be by certified mail, return receipt requested, or by overnight
delivery service to the address furnished to the Company in writing by the last Holder of
this Warrant who shall have furnished an address to the Company in writing.




ISSUED
this                      day of                     , 2007.



AGASSIZ ENERGY, LLC




	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Donald Sargeant, President
	 	 






4









 





FORM OF ASSIGNMENT




AGASSIZ ENERGY, LLC




     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 Membership Units set forth below.



	 	 	 	 	 	 	 	 	 
	Name of Assignee	 	 	 	 	Address	 	Number of Units	 
	 
	 	 	 	 	 	 	 	 




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



Dated:                                         , 20___




                                                                     
           

Signature

                                                                                

Print Name




 









 





EXERCISE FORM




AGASSIZ ENERGY, LLC




(To be
executed only upon exercise of Warrant)




     The undersigned registered owner of this Warrant (the “Investor”) irrevocably exercises this
Warrant for and purchases                                                              of the number of Membership
Units (the “Units”) of                                          purchasable with this Warrant, and herewith makes
payment therefor, all at the price and on the terms and conditions specified in this Warrant.


As a condition to the exercise of this Warrant, the Investor represents and warrants to Company as
follows:



1. Investment Intent.



a. Investor has been advised that (i) the sale of the Units to Investor has not been
registered under the Securities Act of 1933, as amended (the “Act”), on the grounds, among
others, that it will be exempt from registration under Section 4(2) of the Act as a
transaction not involving a public offering; (ii) reliance upon such exemption or exemptions
is predicated in part on Investor’s representation that Investor is acquiring such Units for
investment for Investor’s own account with no present intention of dividing Investor’s
participation with others or reselling or otherwise distributing the same, and the Investor
alone shall have the full legal and equitable right, title and interest in the Units; and
(iii) Investor’s representations, including the foregoing, are essential to the reliance of
the Company upon exemptions from registration or qualification of this transaction or the
Units under applicable state securities laws.



b. Investor understands that the effect and intent of Investor’s representations
in subparagraph (a) above to be that Investor does not presently contemplate the disposal of
all or any part of the Units, and that at such time as Investor determines to dispose of all
or any part of the Units, Investor understands that Investor must first notify the Company,
and that the Company may require an opinion of its attorney, of Investor’s attorney, or both,
that such disposition will not negate Investor’s intent as expressed herein, and that, in
view of the exemption claimed, such disposition will be permissible.



c. Investor understands that the subsequent transfer of the Units will be restricted, and
that the effect of the restrictions on the transfer of the Units include the facts, among
others, that (i) Investor will not have liquidity with respect to the Units for an
indefinite period of time, and (ii) Investor will be unable to sell, encumber or otherwise
transfer the Units unless there is an effective registration statement covering such
disposition under the Act, and effective registrations and qualifications under applicable
state law, or exemptions from such registrations or qualifications under the Act and state
law are applicable.



d. Investor recognizes that an investment in the Units involves a high degree of risk and
that the purchase of the Units is a long-term investment. Investor has a financial net
worth or




 









 




anticipated income such that a sale of such Units need not be made in the foreseeable future to
satisfy any financial obligation of which Investor is or contemplates Investor will become
subject.



e. Investor understands that exemptions from the registration and qualification requirements,
as referred to in subparagraph (c) above, may not be available to Investor, and the Company
will have no obligation to assist Investor in registering or qualifying a disposition of the
Units or in obtaining or establishing an exemption from such registration or
qualification requirements.



f. Investor understands that any certificate representing the Units will bear legends stating
in effect that the issuance or sale of the Units has not been registered under the Act or
any applicable state securities, and such legends may refer to the restrictions on transfers
and sales contained in this Agreement. In addition, any certificates representing the Units
issued to an Investor who is a resident of a particular state may bear a legend containing
language required by the laws of such State. Investor further understands that a
stop-transfer restriction may be placed in the books and records of the Company with respect
to the Units.



g. Investor’s purchase of the Units is not the result of any general solicitation or
general advertising, including, but not limited to: (i) any advertisement, article, notice
or other communication published in any newspaper, magazine or similar media or broadcast
over television or radio; and (ii) any seminar or meeting whose attendees have been invited
by any general solicitation or general advertising.



2. State of Residence. Investor represents and warrants to the Company that Investor is a
bona fide resident of, and is domiciled in, the State of                                         .



3. Accredited Investor Status.



a. Investor understands that Investor is an “accredited investor” only if:





	 	(1)	 	Investor’s individual income from all sources for each of the
two most recent calendar years was in excess of $200,000 and Investor
reasonably expects Investor’s individual income from all sources anticipated
for the current calendar year to be in excess of $200,000; or
	 
	 	(2)	 	Investor’s joint income with Investor’s spouse from all
sources for each of the two most recent calendar years was in excess of
$300,000 and Investor reasonably expects Investor’s joint income with
Investor’s spouse from all sources anticipated for the current calendar year
to be in excess of $300,000; or
	 
	 	(3)	 	Investor’s individual net worth, or Investor’s joint net worth
with Investor’s spouse, at fair market value (including home, furnishings and
personal automobiles) is greater than $1,000,000; or




 









 






	 	(4)	 	Investor otherwise meets the definition of an “accredited investor.”




b. Based on the foregoing information, Investor represents and warrants to the Company that
Investor:





	 	(1)	 	Is an accredited investor (check here):                        o
	 
	 	(2)	 	Is not an accredited investor (check here):                 o




4. Knowledge and Experience. Investor represents and warrants to the Company as follows:



a. Investor (i) believes Investor has such knowledge and experience in financial and business
matters that Investor is capable of evaluating the merits and risks of the
prospective investment in the Units or (ii) if Investor does not so believe, or if Investor
has been instructed by the Company to designate a purchaser representative to supplement
Investor’s knowledge and experience for the purpose of evaluating the merits and risks of the
prospective investment in the Units, Investor has provided the Company with the identity of
such purchaser representative and such information concerning the knowledge and experience in
financial and business matters of such a purchaser representative, either directly or by
making such purchaser representative available for interview, necessary to enable a
determination that such purchaser representative, together with the undersigned, have such
knowledge and experience in financial and business matters that they are capable of
evaluating the merits and risks of the prospective investment in the Units.



b. In addition to designating a purchaser representative to the extent required by
the Company, if any, Investor has obtained, to the extent Investor deems necessary, personal
and professional advice with respect to the risks inherent in the investment in the Units in
light of Investor’s financial condition and investment needs.



c. Investor or Investor’s purchaser representative, if any, has been given access to full
and complete information regarding the Company and has utilized such access to their
satisfaction for the purpose of obtaining information; and particularly, Investor or
Investor’s purchaser representative, if any, have either attended or been given reasonable
opportunity to attend a meeting with representatives of the Company for the purpose of
asking questions of, and receiving answers from, such representatives concerning the Company
and the Units and to obtain any additional information, to the extent reasonably available.





 









 








SIGNATURE PAGE TO EXERCISE FORM




Dated:                                          ___, 20___




                                                                                

Signature of Registered Owner




                                                                                

Street Address




                                                                                

City, State, Zip Code




                                                                                

IRS Identification Number