Document:

ex4_2.htm

Exhibit 4.2

NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.  THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

SERIES A COMMON STOCK PURCHASE WARRANT

AURORA GOLD CORP.

	
Warrant No. A-______

	
Issue Date: _______________________

	  	  
	
Warrant Shares: _________

	
Exercise Date: April 1, 2011

THIS SERIES E COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, ____________________________ (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after April 1, 2011 (the “Initial Exercise Date”) and on or prior to the close of business on March 31, 2012 (the “Termination Date”) but not thereafter, to subscribe for and purchase from Aurora Gold Corp., a Delaware corporation (the “Company”), up to_____________________ shares (the “Warrant Shares”) of Common Stock.  The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).

THIS WARRANT IS BEING DELIVERED PURSUANT TO THE TERMS OF THAT THAT CERTAIN SUBSCRIPTION AGREEMENT (THE “SUBSCRIPTION AGREEMENT”), THE ISSUANCE DATE OF WHICH IS ______________, BETWEEN THE COMPANY AND THE SUBSCRIBER SIGNATORY THERETO.

Section 1.     Definitions.  Capitalized terms used and not otherwise defined herein shall have the meanings set forth in Subscription Agreement.

Section 2.      Exercise.

a)            Exercise of Warrant.  Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy of the Notice of Exercise Form annexed hereto (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company); and, within 3 Trading Days (as defined below) of the date said Notice of Exercise is delivered to the Company, the Company shall have received  payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s check drawn on a United States bank.  Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within 3 Trading Days of the date the final Notice of Exercise is delivered to the Company.  Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased.  The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases.  The Company shall deliver any objection to any Notice of Exercise Form within 2 Business Days following receipt of such notice.  The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof. For purposes of this Agreement, the term “Trading Day” means any day on which the New York Stock Exchange is open for business.

 b)            Exercise Price.  The exercise price per share of the Common Stock under this Warrant shall be $0.40, subject to adjustment hereunder (the “Exercise Price”). 

 

  

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c)            Exercise Limitations.

i.           The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other person or entity acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below).  For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other  Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its affiliates.  Except as set forth in the preceding sentence, for purposes of this Section 2(d)(i), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith.   To the extent that the limitation contained in this Section 2(d)(i) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates) 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 Affiliates) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination.   In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder.  For purposes of this Section 2(d)(i), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent periodic or annual report, as the case may be, (y) a more recent public announcement by the Company or (z) any other notice by the Company or the Company’s Transfer Agent setting forth the number of shares of Common Stock outstanding.  Upon the written or oral request of a Holder, the Company shall within two Trading Days 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 or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported.  The “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant.  The Holder, upon not less than 61 days’ prior notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(d)(i), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(d)(i) shall continue to apply.  Any such increase or decrease will not be effective until the 61st day after such notice is delivered to the Company.  The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 2(d)(i) 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. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.

ii.           Anything herein to the contrary notwithstanding, this Warrant may only be exercised for a minimum of 250,000 shares or if the number of shares for which this Warrant is exercisable is less than 250,000, then for such less number of shares in their entirety.

d)            Mechanics of Exercise.

i.           Delivery of Certificates Upon Exercise.  Certificates for shares purchased hereunder shall be transmitted by the transfer agent of the Company to the Holder by physical delivery to the address specified by the Holder in the Notice of Exercise within 3 Trading Days from the delivery to the Company of the Notice of Exercise Form, surrender of this Warrant (if required) and payment of the aggregate Exercise Price as set forth above (“Warrant Share Delivery Date”).  This Warrant shall be deemed to have been exercised on the date the Exercise Price is received by the Company.  The Warrant Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised by payment to the Company of the Exercise Price and all taxes required to be paid by the Holder, if any, pursuant to Section 2(e)(vi) prior to the issuance of such shares, have been paid.

  

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ii.           Delivery of New Warrants Upon Exercise.  If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the certificate or certificates representing Warrant Shares, deliver to Holder a new Warrant evidencing the rights of Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

iii.           Rescission Rights.  If the Company fails to cause its transfer agent to transmit to the Holder a certificate or certificates representing the Warrant Shares pursuant to Section 2(c)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

iv.           No Fractional Shares or Scrip.  No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant.  As to any fraction of a share which Holder would otherwise be entitled to purchase upon such exercise, the Company shall at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.

v.           Charges, Taxes and Expenses.  Issuance of certificates for Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such certificate, all of which taxes and expenses shall be paid by the Company, and such certificates shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that in the event certificates for Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder; and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto.

vi.           Closing of Books.  The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

Section 3.      Certain Adjustments.

a)            Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (A) pays a stock dividend or otherwise make a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this Warrant), (B) subdivides outstanding shares of Common Stock into a larger number of shares, (C) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (D) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged.  Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

b)            Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

  

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c)            Voluntary Adjustment By Company. The Company may at any time during the term of this Warrant reduce the then current Exercise Price, without in the sole discretion of the Company increasing the number of shares issuable upon exercise of this Warrant, to any amount and for any period of time deemed appropriate by the Board of Directors of the Company.

d)           Notice to Holder.

i.           Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly mail to the Holder a notice setting forth the Exercise Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment.

ii.           Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Stock; (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock; (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights; (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, of any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property; (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company; then, in each case, the Company shall cause to be mailed to the Holder at its last address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified in such notice.  The Holder is entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice.

Section 4.      Transfer of Warrant.

a)            Transferability.  Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof and to the provisions of Section 2, of the Subscription Agreement, this Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer.  Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled.  A Warrant, if properly assigned, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

b)            New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney.  Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Issue Date set forth above and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

  

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c)            Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”), in the name of the record Holder hereof from time to time.  The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

d)            Transfer Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this Warrant shall not be registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue sky laws, the Company may require, as a condition of allowing such transfer, that the Holder or transferee of this Warrant, as the case may be, comply with the transfer provisions the Subscription Agreement.

Section 5.     Miscellaneous.

a)           No Rights as Shareholder Until Exercise.  This Warrant does not entitle the Holder to any voting rights or other rights as a shareholder of the Company prior to the exercise hereof as set forth in Section 2(a).

b)           Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

c)            Saturdays, Sundays, Holidays, etc.  If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a business day, then such action may be taken or such right may be exercised on the next succeeding business day.

d)            Authorized Shares.

The Company covenants that during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.  The Company further covenants 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 the Warrant Shares upon the exercise of the purchase rights under this Warrant.

Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its articles 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 of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment.  Without limiting the generality of the foregoing, the Company will (a) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (b) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant, and (c) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under this Warrant.

Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

e)            Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance with the provisions of the Subscription Agreement.

f)             Restrictions.  The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, will have restrictions upon resale imposed by state and federal securities laws.

g)            Nonwaiver and Expenses.  No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice Holder’s rights, powers or remedies, notwithstanding the fact that all rights hereunder terminate on the Termination Date.  If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

  

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h)            Notices.  Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance with the notice provisions of the Subscription Agreement.

i)             Limitation of Liability.  No provision hereof, in the absence of any affirmative action by Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of Holder, shall give rise to any liability of Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

j)             Remedies.  Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant.  The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.

k)            Successors and Assigns.  Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company and the successors and permitted assigns of Holder.  The provisions of this Warrant are intended to be for the benefit of all Holders from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.

l)             Amendment.  This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

m)            Severability.  Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.

n)            Headings.  The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

o)            Restricted Shares. Holder understands and acknowledges that the Warrant Shares have not been registered under the 1933 Act for resale and Holder will not sell, offer to sell, assign, pledge, hypothecate or otherwise transfer any of the Warrant Shares unless pursuant to an effective registration statement under the 1933  Act, or unless an exemption from registration is available.  Notwithstanding anything to the contrary contained in this Warrant, Holder may transfer (without restriction and without the need for an opinion of counsel) the Warrant Shares to its Affiliates (as defined below) provided that each such Affiliate is an “accredited investor” under Regulation D and such Affiliate agrees to be bound by the terms and conditions of the Subscription Agreement. For the purposes of this Warrant, an “Affiliate” of any person or entity means any other person or entity directly or indirectly controlling, controlled by or under direct or indirect common control with such person or entity.

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

Aurora Gold Corp.

	
By:

	  

Name:

Title:

  

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NOTICE OF EXERCISE

(Series A Warrant)

TO:

Aurora Gold Corp.

C/- Coresco AG

Level 3

Gotthardstrasse 20

6304 Zug

Switzerland

 

(1)           The undersigned hereby elects to purchase ______________Warrant Shares of the Company pursuant to the terms of the attached Series A Warrant (only if exercised in full), 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 Warrant Shares in the name of the undersigned or in such other name as is specified below:

_______________________________

_______________________________

_______________________________

_______________________________

(3)  Accredited Investor.  The undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act of 1933, as amended.

[SIGNATURE OF HOLDER]

	
Name of Investing Entity:

	  

	
Signature of Authorized Signatory of Investing Entity:

	  

	
Name of Authorized Signatory:

	  

	
Title of Authorized Signatory:

	  

	
Date:

	  

  

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ASSIGNMENT FORM

(To assign the foregoing warrant, execute this form and supply required information.

Do not use this form to exercise the warrant.)

TO:

Aurora Gold Corp.

C/- Coresco AG

Level 3

Gotthardstrasse 20

6304 Zug

Switzerland

FOR VALUE RECEIVED, [___________] all of or [____________] shares of the foregoing Series A Warrant of AcqueBlu Corp. and all rights evidenced thereby are hereby assigned to

_______________________________________________ whose address is

 

______________________________________________________________.

 

______________________________________________________________

 

	  	  	
Dated:  ______________, _______

	  	  	  
	  	
Holder’s Signature:

	 	  
	  	  	  
	  	
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 Series A 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 Series A Warrant.

 

 

8Unassociated Document

EXHIBIT 10.77

SEPARATION AGREEMENT

THIS SEPARATION AGREEMENT (this “Agreement”) is entered into on October 19, 2010, by and between Avatar Holdings Inc., a Delaware corporation (the “Company”) and Gerald D. Kelfer (the “Executive”).

WHEREAS, the Executive and the Company (each, a “Party” and together, the “Parties”) are parties to an Amended and Restated Employment Agreement dated as of December 22, 2008 (the “Employment Agreement”) pursuant to which the Executive serves as Chief Executive Officer of the Company; and

WHEREAS, the Parties have agreed that the Executive’s employment with the Company will terminate as of November 15, 2010 (the “Termination Date”); and

WHEREAS, the Parties wish to set forth their respective rights and obligations in connection with the termination of Executive’s employment with the Company.

NOW, THEREFORE, based upon the mutual promises and conditions contained herein, the Parties agree as follows:

1.             Termination of Employment. The Executive’s employment (a) as President and Chief Executive Officer of the Company, (b) as President of Avatar Properties Inc. (“API”), (c) as Chairman, and member, of the Board of Directors of API, and (d) in all other positions, offices and titles that he holds at the Company or any of its subsidiaries or affiliates immediately prior to the Termination Date, shall terminate as of the Termination Date, and in each case such termination shall be treated as a termination without Cause (as defined in the Employment Agreement). Notwithstanding the foregoing, the Executive shall remain a member of the Board of Directors of the Company (the “Board”) until the next regularly scheduled annual meeting of the shareholders of the Company.

2.             The Executive’s Entitlements. In connection with the foregoing, and in accordance with the applicable terms of the Employment Agreement, the Executive shall:

(a)            continue to receive his base salary at an annualized rate of $450,000 (which shall be paid in accordance with the Company’s regular payroll practices) from the Effective Date (as defined below) through June 30, 2011 (the “Severance Termination Date”);

(b)            be paid a bonus in respect of calendar year 2010 in the amount of $450,000 (which shall be paid at the same time that bonuses in respect of 2010 are paid to other senior executives generally);

(c)            be paid a bonus in respect of calendar year 2011 in the amount of $225,000 (which shall be paid on the eighth day following the date Executive has executed, and not revoked, a release containing terms substantially similar to the release set forth in Section 3 below, which release will be provided by the Company as soon as practicable following the Severance Termination Date);

  

  

  

(d)            be paid four annual payments in the amount of $250,000 each (which shall be paid in December 2010, January 2012, January 2013, and January 2014); and

(e)            continue to participate all employee benefit plans and programs from the Effective Date through the Severance Termination Date to the extent applicable to other senior executives of the Company (provided that Executive’s continued participation is permissible under the general terms and provisions of such plans and programs; and if Executive’s participation in any such plan or program is not permitted, Executive shall be entitled to receive an amount equal to the annual contributions, payments, credits or allocations made by the Company to Executive’s account or on Executive’s behalf under such plans and programs).

3.             Mutual Release of Claims.

(a)            Release by the Executive. The Executive, on his own behalf and on behalf of his heirs, executors, administrators and legal representatives (collectively, the “Executive Parties”) hereby irrevocably and unconditionally releases and forever discharges the Company and its shareholders, employees, officers and directors (collectively, the “Company Parties”) from any and all claims, actions, causes of action, rights, judgments, obligations, damages, demands, accountings or liabilities of whatever kind or character (collectively, “Claims”), whether known or unknown, whether now existing or hereafter arising, that any Executive Party may have, may have had, or may hereafter have, and that are based in whole or in part on facts, whether or not now known, existing prior to the Effective Date, regarding any matter whatsoever, including but not limited to any Claim based on Title VII of the Civil Rights Act of 1964; the Americans With Disabilities Act; the Fair Labor Standards Act; the Equal Pay Act; the Family and Medical Leave Act; the Executive Retirement Income Security Act of 1974 (except as to claims pertaining to vested benefits under employee benefit plans maintained by the Company); the Occupational Safety and Health Act; the Worker Adjustment and Retraining Notification Act; the National Labor Relations Act; the Immigration Reform and Control Act; all applicable amendments to the foregoing acts and laws; and any common law, public policy, contract (whether oral or written, express or implied) and tort law, and any other local, state, federal or foreign law, regulation or ordinance having any bearing whatsoever on the Executive’s employment relationship with, and service as an employee, officer or director of, the Company, and the termination of such relationship or service, or any other matter whatsoever; provided, however, that this Agreement shall not release any rights or entitlements of the Executive that arises under or is preserved by this Agreement.

(b)            Release by the Company. The Company, on behalf of itself and the Company Parties, hereby releases, acquits and forever discharges the Executive and the Executive Parties from any and all Claims, whether known or unknown, whether now existing or hereafter arising, at law or in equity, that any Company Party may have, may have had, or may hereafter have, and that are based in whole or in part on facts, whether or not now known, existing prior to the Effective Date, regarding any matter whatsoever, other than claims based on the Executive’s willful misconduct, fraud or gross neglect.

  

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4.             Restrictive Covenants.

(a)            Executive agrees, from the Effective Date through the Severance Termination Date, to make known Executive’s availability for employment involving services of a nature substantially similar and of a comparable stature to those performed by Executive on behalf of the Company in a manner customary for executives holding positions substantially similar and of a comparable stature to Executive’s position with the Company. Executive agrees to keep the Chairman of the Board (or his designee) apprised of Executive’s employment status during such period and, if requested, Executive will provide appropriate supporting documentation with respect to the salary, bonuses or other compensation earned by and benefits made available to Executive in respect of such employment. In the event Executive secures employment as described in this Section 4(a), the Company shall be entitled to (i) deduct from the amounts payable to Executive pursuant to Sections 2(a) and 2(b) above any salary, bonuses or other compensation paid to Executive in connection with such employment and (ii) terminate Executive’s participation in (and shall not be required to pay Executive any sums in respect of) any employee benefit plans and programs described in Section 2(e) that are substantially similar to any employee benefit plans and programs in which Executive participates in connection with such new or existing employment. Executive agrees promptly to repay to the Company any amounts paid to Executive by the Company pursuant to Sections 2(a) and 2(b) which the Company was entitled to deduct from such amounts pursuant to this Section 4(a).

(b)            Executive agrees, as a condition to the performance by the Company of its obligations hereunder, particularly its obligations under Section 2 above, that from the Effective Date through the first anniversary of the Effective Date, Executive shall not, without the prior written consent of the Board, directly or indirectly through any other person, firm or corporation:

(i)             Engage, participate, own or make any financial investments in, or become employed by or render (whether or not for compensation) any consulting, advisory or other services to or for the benefit of, any person, firm or corporation, that directly or indirectly, engages primarily in, the development of adult retirement communities and/or active adult communities; provided, however, that it shall not be a violation of this Agreement for Executive (x) to have beneficial ownership of less than 1% of the outstanding amount of any class of securities of any enterprise (but without otherwise participating in the activities of such enterprise) if such securities are registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or quoted on an inter-dealer quotation system or (y) to have beneficial ownership of less than 20% of the outstanding amount of any class of securities of any enterprise (but without otherwise participating in the activities or otherwise having influence or control of such enterprise) if such securities are not registered under Section 12 of the Exchange Act or quoted on an inter-dealer quotation system;

  

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(ii)           Solicit, raid, entice or induce any person, firm or corporation that is or, at any time during the term of Executive’s employment, was, a customer of the Company or any subsidiary or affiliate of the Company (collectively, the “Avatar Entities”) to become a customer of any other person, firm or corporation, and Executive shall not approach any such person, firm or corporation for such purpose or authorize or knowingly approve the taking of such actions by any other person; or

(iii)          Solicit, raid, entice or induce any person that is or, at any time during the term of Executive’s employment, was, an employee of any of the Avatar Entities to become employed by any person, firm or corporation, and Executive shall not approach any such employee for such purpose or authorize or knowingly approve the taking of such actions by any other person.

(c)            Confidential Information. Recognizing that the knowledge, information and relationship with customers, suppliers, and agents, and the knowledge of the Avatar Entities’ business methods, systems, plans and policies, that Executive established, received or obtained as an employee of the Company are valuable and unique assets of the respective businesses of the Avatar Entities, Executive agrees that, from and after the Effective Date, Executive shall not disclose, without the prior written approval of the Board, any such knowledge or information pertaining to any of the Avatar Entities, their business, personnel or policies, to any person, firm, corporation or other entity, for any reason or purpose whatsoever. The provisions of this Section 4(c) shall not apply to information (i) that is or shall become generally known to the public or the trade (except by reason of Executive’s breach of Executive’s obligations hereunder), (ii) that is or shall become available in trade or other publications, (iii) that was known to Executive prior to entering the employ of the Company, and (iv) that Executive is required to disclose by order of a court of competent jurisdiction (provided that prior to Executive’s disclosure of any such information Executive shall provide the Company with reasonable notice and a reasonable opportunity to seek a protective order to prevent such disclosure).

(d)            Geographic Scope. The provisions of Section 4(b) shall be in full force and effect within a 100-mile radius of a site for which any Avatar Entity is preparing to develop, has commenced development of, or has a binding commitment or option to purchase, real estate. Executive and the Company expressly agree that the prohibitions set forth in Section 4(b) shall be in full force and effect with respect to any services or business activity which competes in the above mentioned geographic area with the business operations or activities of any of the Avatar Entities, regardless of the geographic location of Executive in rendering such services or engaging in such business activity.

  

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(e)            Non-Disparagement. Neither Party shall, directly or indirectly, make (or cause to be made) any comment or statement, in the media or to the press or to any individual or entity with whom either Party has a significant business or professional relationship, that should reasonably be expected to adversely affect the other Party’s reputation or the conduct of such other Party’s business; provided, however, that nothing in this Section 4(e) shall prevent either Party from making truthful statements to the extent required by law, court order or subpoena or in any judicial process or proceeding.

(f)            Remedies. Executive acknowledges and agrees that, in light of the nature of the business in which the Avatar Entities are engaged, the restrictive covenants in this Section 4 are reasonable and necessary in order to protect the legitimate business interests of the Avatar Entities and that violation thereof would result in irreparable injury to the Avatar Entities. Accordingly, Executive consents and agrees that if Executive violates or threatens to violate any of the provisions of this Section 4, the Avatar Entities would sustain irreparable harm and, therefore, the Avatar Entities shall be entitled to obtain from any court of competent jurisdiction, temporary, preliminary and/or permanent injunctive relief as well as damages, attorneys fees and costs, and an equitable accounting of all earnings, profits and other benefits arising from such violation, which rights shall be cumulative and in addition to any other rights or remedies in law or equity to which the Avatar Entities may be entitled.

5.             Miscellaneous.

(a)            Public Announcements. The Executive and the Company shall jointly draft, and shall mutually agree on, any press release, regulatory filing, or other public statement that is made by the Company and that relates to this Agreement or to the Executive’s employment with, or services for, the Company or to the termination thereof.

(b)            Tax Withholding; Section 409A. The Company shall withhold from any amount or benefit payable under this Agreement any taxes that it is required to withhold by applicable law or regulation. Notwithstanding anything herein to the contrary, this Agreement is intended to be interpreted and applied so that the payment of the benefits set forth herein either shall either be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) or shall comply with the requirements of such provision. Notwithstanding anything herein to the contrary, if the Executive is a “specified employee” (within the meaning of Section 409A of the Code (“Section 409A”)), any payments or arrangements due on or after the Separation Date under any arrangement that constitutes a “deferral of compensation” (within the meaning of Section 409A) and which do not otherwise qualify under the exemptions under Treas. Regs. Section 1.409A, shall be delayed and paid or provided on the earlier of (i) the date which is six months after the Executive’s “separation from service” (as such term is defined in Section 409A) for any reason other than death, and (ii) the date of his death. After the Effective Date, the Executive shall have no duties or responsibilities that are inconsistent with having a “separation from service” as of such date. Any amounts otherwise payable to the Executive on or after the Effective Date that are not so paid by reason of this Section 5(b) shall be paid as soon as practicable after, and in any event within thirty (30) days after, the date that is six months after the Executive’s separation from service (or, if earlier, the date of his death). Each payment under this Agreement or otherwise shall be treated as a separate payment for purposes of Section 409A.

  

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(c)            Notice. Any notice or other communication required or permitted to be delivered under this Agreement shall be (i) in writing; (ii) delivered personally, by facsimile, by electronic mail, by courier service or by certified or registered mail, first class postage prepaid and return receipt requested; (iii) deemed to have been received on the date of delivery or, if so mailed, on the third business day after the mailing thereof; and (iv) addressed to the party as set forth below (or to such other address as the party entitled to notice shall hereafter designate in accordance with the terms hereof).

	
If to Employee:

	
Gerald D. Kelfer

3301 South Mooring Way

Miami, Florida 33133

	
If to the Company:

	
Avatar Holdings Inc.

201 Alhambra Circle, 12th Floor

Coral Gables, Florida 33134

Attention: Chairman of the Board and General Counsel

Facsimile: (305) 441-7876

	
with a copy to:

	
Morrison Cohen LLP

909 Third Avenue

New York, New York 10022

Attention: David A. Scherl, Esq.

Facsimile: (212) 735-8608

or to such other address as any party may have furnished to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt.

(d)            Amendment or Modification; Waiver. No provision of this Agreement may be modified, waived or discharged unless such modification, waiver or discharge is set forth in a writing that expressly identifies provisions being amended and that is signed by the Parties. No waiver by any person or entity of any breach of any condition or provision contained in this Agreement shall be deemed a waiver of any similar or dissimilar condition or provision at any prior or subsequent time. To be effective, a waiver must be set forth in a writing that is signed by the waiving person or entity and that expressly identifies the condition or provision breach of which is being waived.

(e)            Binding Effect. This Agreement shall be binding on and inure to the benefit of the Company and its successors and assigns and the Executive and the Executive’s heirs, executors, administrators and legal representatives.

  

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(f)            Entire Agreement. This Agreement constitutes the entire understanding and agreement between the Parties concerning the specific subject matter hereof and supersedes in its entirety, as of the Effective Date, any prior agreement between the Parties, including but not limited to the Employment Agreement; provided, however, that this Agreement shall not supersede the Amended and Restated Stock Unit Agreement between the Parties, dated as of December 22, 2008, which shall remain in effect in accordance with its terms.

(g)            Effective Date. The Executive acknowledges that he has been given a period of at least twenty-one (21) calendar days to review and consider the provisions of this Agreement. The Executive further understands and acknowledges that he has seven (7) calendar days following the execution of this Agreement to revoke his acceptance of this Agreement. This Agreement will not become effective or enforceable until after the seven (7) day period to revoke this Agreement has expired without the Executive’s revocation. The effective date of this Agreement (the “Effective Date”) shall be the eighth (8th) day following its execution by the Executive, provided the Executive shall not have timely revoked this Agreement in accordance with the foregoing prior to such eighth (8th) day.

(h)            Governing Law. This Agreement shall be governed, construed, performed and enforced in accordance with its express terms and otherwise in accordance with the laws of the State of New York, without reference to principles of conflicts of law.

(i)            Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures delivered by facsimile and/or “pdf” shall be deemed effective for all purposes.

(j)            Headings. The headings of the sections and sub-sections contained in this Agreement are for the convenience only and shall not be deemed to control or affect the meaning or construction of any provision of this Agreement.

[Signature page follows]

  

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date and year first above written.

	  	
AVATAR HOLDINGS INC.

	  	  	  
	  	
By:

	
/s/ Joshua Nash

	  	
Name:  

	
Joshua Nash

	  	
Title:

	
Chairman

	  	  	  
	  	
GERALD D. KELFER

	  	  	  
	  	
/s Gerald D. Kelfer

 

 

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