Document:

ex_139335.htm

 

Exhibit 10.1

 

 

	 	
			 PROPOSAL FOR SERVICES

				 
	
			proposal ref No:

				
			P[***]

			
	
			Project Name:

				
			Miami Dolphins – Altitude Chamber

			
	
			Client:

				
			Miami Dolphins Ltd.

			
	
			CONTACT PERSON:

				
			[****]

			
	
			Client Address: 

				
			7500 S. W. 30th Street

			Davie, FL 33314

			[***] 

			
	 	 
	
			CLIENT has requested a Proposal from Altitude International Inc. (hereinafter “ALTD”) to perform the following Services:

				 
	 	 
	
			Scope of Services

				 	 
	
			The ALTD scope will be to manufacture, install and test/commission an Altitude International Altitude Chamber at the Miami Dolphins Strength and Conditioning Facility in Davie, FL. Please see Attachment 1 for additional details.

				 
	 	 
	
			Compensation

				 	 
	
			Compensation by Client to ALTD shall be USD $[****]. Please see Attachment 2 for additional details.

				 
	 	 
	
			Schedule

				 	 
	
			From the date of Project Award and receipt of the Advance Payment to final testing and commissioning, we anticipate a period of 12 weeks. Please see Attachment 3 for additional details.

				 
	 	 
	
			Other Terms

				 	 
	
			Please see Attachment 4 – Warranty and Maintenance/Service Schedule attached. Rider

				 
	 	 
	 	 
	
			Services covered by this AGREEMENT will be performed in accordance with the attached Provisions, Schedules and Plans. This AGREEMENT supersedes all prior agreements and understandings and cannot be superseded.

				 
	 	 
	
			CLIENT:

				 	 	
			ALTD INC.:

				 	 
	
			Signature

				
			/s/ Brandon Shore

				 	
			Signature

				
			/s/ Joseph B. Frost

				 
	
			Name (printed)

				
			Brandon Shore

				 	
			Name (printed)

				
			JOSEPH B. FROST

				 
	
			Title

				
			V.P. Football Admin

				 	
			Title

				
			Chief Operating Officer

				 
	
			Date

				
			23 March 2019

				 	
			Date

				
			21 March 2019

				 
	 	 

 

 

 

 

 

PROVISIONS (as applicable)

1.     Authorization to Proceed

Execution of this AGREEMENT by CLIENT will be authorization for Altitude International (hereinafter ALTD) to proceed with the Services, unless otherwise provided for in this AGREEMENT.

 

	
			2.

				
			Salary Costs-N/A

			

ALTD and its affiliated companies’ Salary Costs, when the basis of compensation, are the amount of wages or salaries paid ALTD employees for work directly performed on the Project plus a percentage applied to all such wages or salaries to cover all payroll-related taxes, payments, premiums, and benefits.

 

	
			3.

				
			Per Diem Rates-N/A

			

ALTD's and its affiliated companies’ Per Diem Rates, when the basis of compensation, are those hourly or daily rates charged for work performed on the Project by ALTD employees. These rates are contained in the COMPENSATION section on Page 1 and are subject to a 4% annual calendar year escalation/adjustment.

 

	
			4.

				
			Subcontracts and Direct Expenses -N/A

			

When Services are performed on a cost reimbursement basis, a markup of [****] percent will be applied to subcontracts and outside services and a markup of [****] percent will be applied to Direct Expenses. For purposes of this AGREEMENT, Direct Expenses are defined to include those necessary costs and charges incurred for the Project including, but not limited to: (1) the direct costs of transportation, meals, lodging, shipping, equipment and supplies; (2) ALTD's current standard rate charges for direct use of ALTD's vehicles, laboratory test and analysis, and certain field equipment; and (3) ALTD’s standard project charges for computing systems, and health and safety requirements as required by local and federal guidelines.

All sales, use, value added, business transfer, gross receipts, or other similar taxes will be added to ALTD’s compensation when invoicing CLIENT.

 

	
			5.

				
			Cost Opinions

			

Any cost opinions or Project economic evaluations provided by ALTD will be on a basis of experience and judgment, but, since ALTD has no control over market conditions or bidding procedures, ALTD cannot warrant that bids, ultimate construction cost, or Project economics will not vary from these opinions.

 

	
			6.

				
			Standard of Care

			

The standard of care applicable to ALTD's services will be the degree of skill and diligence normally employed by professional engineers or consultants performing the same or similar services at the time ALTD's services are performed. ALTD will re-perform any services not meeting this standard without additional compensation.

 

7.     Termination

Subject to the terms of Section 22 hereof, this AGREEMENT may be terminated for convenience on 30 days written notice by either Party or if either party fails substantially to perform through no fault of the other and does not commence correction of such nonperformance within 5 days of written notice and diligently complete the correction thereafter. On termination, ALTD will be paid for all authorized work performed up to the termination date plus termination expenses, such as, but not limited to, cost of equipment purchased, reassignment of personnel, subcontract termination costs, and related closeout costs.

 

 

 

 

8.     Payment to ALTD

 

When monthly invoices are issued by ALTD for Services performed under this AGREEMENT, CLIENT shall pay each invoice within 30 days. Interest at a rate of 1-1/2 percent per month will be charged on all past-due amounts.

 

        In the event of a disputed billing, only that disputed portion may be withheld from payment, and the undisputed portion will be paid. CLIENT will exercise reasonableness in disputing any bill or portion thereof. No interest will accrue on any disputed portion of the billing until mutually resolved.

 

	
			9.

				
			Limitation of Liability

			

EXCEPT FOR THE INDEMNIFICATION PROVIDED IN SECTION 17 HEREOF, ALTD'S MAXIMUM LIABILITY FOR ANY ACTION ARISING UNDER THIS AGREEMENT, REGARDLESS OF THE FORM OF ACTION AND WHETHER IN TORT OR CONTRACT, SHALL BE LIMITED TO THE AMOUNT OF SERVICES FEES PAID BY CLIENT FOR THE SERVICES FROM WHICH THE CLAIM AROSE. IN NO EVENT SHALL ALTD BE LIABLE FOR INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING WITHOUT LIMITATION, LOST DATA OR LOST PROFITS, HOWEVER ARISING, EVEN IF CLIENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THE PARTIES AGREE TO THE ALLOCATION OF RISK SET FORTH HEREIN. This Provision takes precedence over any conflicting Provision of this AGREEMENT or any document incorporated into it or referenced by it. In no event shall ALTD, its affiliated companies, officers, employees, or any of its subcontractors be liable for any incidental, indirect, special, punitive, economic or consequential damages, including but not limited to loss of revenue or profits, suffered or incurred by CLIENT or any of its agents, including other contractors engaged at the project site, as a result of this Agreement or ALTD’s performance or non-performance of services pursuant to this Agreement. Limitations of liability provided herein will apply whether ALTD's liability arises under breach of contract or warranty; tort, including negligence; strict liability; statutory liability; or any other cause of action, and shall include ALTD's officers, affiliated corporations, employees, and subcontractors.

 

10.   Severability and Survival

If any of the provisions contained in this AGREEMENT are held illegal, invalid or unenforceable, the other provisions shall remain in full effect. Limitations of liability shall survive termination of this AGREEMENT for any cause.

 

11.   No Third Party Beneficiaries

This AGREEMENT gives no rights or benefits to anyone other than CLIENT and ALTD and has no third party beneficiaries except as provided in Provision 10.

 

12.   Materials and Samples

Any items, substances, materials, or samples removed from the Project site for testing, analysis, or other evaluation will be returned to the Project site unless agreed to otherwise. CLIENT recognizes and agrees that ALTD is acting as a bailee and at no time assumes title to said items, substances, materials, or samples. CLIENT recognizes that ALTD assumes no risk and/or liability for a waste or hazardous waste site originated by other than ALTD.

 

13.   Assignments

Neither party shall have the power to or will assign any of the duties or rights or any claim arising out of or related to this AGREEMENT, whether arising in tort, contract or otherwise, without the written consent of the other party. Any unauthorized assignment is void and unenforceable.

 

14.   Integration

This AGREEMENT incorporates all previous communications and negotiations and constitutes the entire agreement of the parties. If CLIENT issues a Purchase Order in conjunction with performance of the Services, general or standard terms and conditions on the Purchase Order do not apply to this AGREEMENT.

 

15.   Force Majeure

If performance of the Services is affected by causes beyond ALTD’s reasonable control, project schedule and compensation shall be equitably adjusted. Except for Client's obligation to pay ALTD, neither party shall be liable for any failure to perform its obligations under this Agreement or any Statement of Work if prevented from doing so by a cause or causes beyond its control, including without limitation, acts of God or public enemy, failure of suppliers to perform, fire, floods, storms, earthquakes, riots, strikes, war, and restraints of government.

 

 

 

 

16. Confidential Information

 

16.1 DEFINITION. The term "CONFIDENTIAL INFORMATION" shall mean: (i) any and all information which is disclosed by either party ("OWNER") to the other ("RECIPIENT") verbally, electronically, visually, or in a written or other tangible form which is either identified or should be reasonably understood to be confidential or proprietary; and (ii) the terms, including without limitation, the pricing, of this Agreement and any proposals or other documents that preceded this Agreement. Confidential Information may include, but not be limited to, trade secrets, computer programs, software, documentation, formulas, data, inventions, techniques, marketing plans, strategies, forecasts, client lists, employee information, financial information, confidential information concerning Owner's business or organization, as Owner has conducted it or as Owner may conduct it in the future. In addition, Confidential Information may include information concerning any of Owner's past, current, or possible future products or methods, including information about Owner's research, development, engineering, purchasing, manufacturing, accounting, marketing, selling, leasing, and/or software (including third party software).

 

16.2 TREATMENT OF CONFIDENTIAL INFORMATION. Owner's Confidential Information shall be treated as strictly confidential by Recipient and shall not be disclosed by Recipient to any third party except to those third parties operating under non-disclosure provisions no less restrictive than in this Section 16 and who have a justified business "need to know". Client shall protect the deliverables resulting from Services with the same degree of care. This Agreement imposes no obligation upon the Parties with respect to Confidential Information which either party can establish by legally sufficient evidence: (a) was in the possession of, or was rightfully known by the Recipient without an obligation to maintain its confidentiality prior to receipt from Owner; (b) is or becomes generally known to the public without violation of this Agreement; (c) is obtained by Recipient in good faith from a third party having the right to disclose it without an obligation of confidentiality; (d) is independently developed by Recipient without the participation of individuals who have had access to the Confidential Information; or (e) is required to be disclosed by court order or applicable law, provided notice is promptly given to the Owner and provided further that diligent efforts are undertaken to limit disclosure.

 

16.3 RIGHTS & DUTIES. The Recipient shall not obtain, by virtue of this Agreement, any rights, title, or interest in any Confidential Information of the Owner. Within fifteen (15) days after termination of this Agreement, each party shall certify in writing to the other that all copies of Confidential Information in any form, including partial copies, have been destroyed, returned, or used solely as the Owner so directs.

 

16.4 SURVIVABILITY. The terms of this Section 16 shall survive termination of this Agreement. If the Parties have executed a separate agreement that contains confidentiality terms prior to or contemporaneously with this Agreement, those separate confidentiality terms shall remain in full force to the extent they do not conflict.

 

17. Indemnity

 

17.1 INDEMNITY. Each party ("INDEMNIFYING PARTY") shall indemnify and hold the other party ("INDEMNIFIED PARTY") harmless against any third party claim, including costs and reasonable attorney's fees, in which the Indemnified Party is named as a result of the grossly negligent or intentional acts or failure to act by the Indemnifying Party, its employees or agents, while performing its obligations hereunder, which result in death, personal injury, or tangible property damage. This indemnification obligation is contingent upon the Indemnified Party providing the Indemnifying Party with prompt written notice of such claim, information, all reasonable assistance in the defense of such action, and sole authority to defend or settle such claim.

17.2 SURVIVAL. The terms of this Section 17 shall survive termination of this Agreement.

 

18. Warranties and Representations

 

Each party warrants that it has the right and power to enter into this Agreement and an authorized representative has executed this Agreement. ALTD warrants that the Services will be performed in a professional and workmanlike manner in accordance with recognized industry standards. To the extent Services provided by ALTD are advisory, no specific result is assured or guaranteed. ALTD EXPRESSLY DISCLAIMS ALL OTHER REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESS, IMPLIED, OR STATUTORY (BY ANY TERRITORY OR JURISDICTION) TO THE EXTENT PERMITTED BY LAW, AND FURTHER ALTD EXPRESSLY EXCLUDES ANY WARRANTY OF NON-INFRINGEMENT, TITLE, FITNESS FOR A PARTICULAR PURPOSE, OR MERCHANTABILITY TO THE EXTENT PERMITTED BY LAW.

 

 

 

 

 

19. Rights to Work Product

 

Any expression or result of ALTD's Services, or the work, findings, analyses, conclusions, opinions, recommendations, ideas, techniques, know-how, designs, programs, tools, applications, interfaces, enhancements, software, and other technical information (collectively "WORK PRODUCT") created by ALTD in the course of performing the Services hereunder are the property of ALTD and are licensed to Client, without further license fees, provided, however, to the extent such Work Product provided to Client by ALTD contains Client's Confidential Information, Client shall retain title to such Confidential Information. Client shall have no right to sublicense, transfer, assign, convey or permit any third party to use or copy any Work Product.

 

20. Independent Contractor Status

 

ALTD performs this Agreement as an independent contractor, not as an employee of Client. Nothing in this Agreement is intended to construe the existence of a partnership, joint venture, or agency relationship between Client and ALTD.

 

21. Notice

 

All notices or other communications referenced under this Agreement shall be made in writing and sent to the address designated above, designated in a specific Statement of Work, or designated from time to time in writing by the Parties. All notices shall be deemed given to the other party if delivered receipt confirmed using one of the following methods: registered or certified first class mail, postage prepaid; recognized courier delivery; or electronic mail.

 

22. Termination of Professional Services

 

Unless otherwise agreed to, either party may terminate this Agreement or any Statement of Work at any time by giving the other party written notice of termination. If this Agreement or a Statement of Work is terminated by the Client, Client shall pay ALTD for all work performed and for all expenses incurred prior to the effective date of termination. Client shall also pay a termination fee equal to 25% of the total amount contracted for the professional service under the applicable Statement of Work. If Client provides less than six (6) business days advance notice of a Statement of Work termination for which professional services have been scheduled, the termination fee payable as set forth above shall be equal to 100% of the scheduled service as set forth in the Statement of Work.

 

23. Postponement of Professional Services

 

No penalty will be assessed if Client postpones a scheduled professional service at least 20 business days or more before the start of the scheduled professional service. If Client postpones a scheduled professional service at least six (6) but less than twenty (20) business days before the start of the scheduled professional service, a penalty of 25% of the amount of the scheduled professional service may be assessed. If Client postpones a scheduled professional service less than six (6) business days before the start of the scheduled professional service, a penalty up to 100% of the scheduled service may be assessed.

 

24. Waiver

 

No modification to this Agreement nor any failure or delay in enforcing any term, exercising any option, or requiring performance shall be binding or construed as a waiver unless agreed to in writing by both parties.

 

25. General

 

This Agreement shall be governed by the laws of the United States of America as applicable in the State of Florida. Except as otherwise specifically stated herein, remedies shall be cumulative and there shall be no obligation to exercise a particular remedy. If any provision of this Agreement is held to be unenforceable, the other provisions shall nevertheless remain in full force and effect. This Agreement and the Statement(s) of Work constitute the entire understanding between the Parties with respect to the subject matter herein and may only be amended or modified by a writing signed by a duly authorized representative of each party. This Agreement may be executed by facsimile. This Agreement replaces and supersedes any prior verbal or written understandings, communications, and representations between the Parties regarding the subject matter contained herein. No purchase order or other ordering document that purports to modify or supplement the printed text of this Agreement or any Exhibit shall add to or vary the terms of this Agreement or Exhibit. All such proposed variations, edits, or additions (whether submitted by ALTD or Client) to this Agreement or to a Statement of Work, are objected to and deemed material unless otherwise mutually agreed to in writing.

 

 

 

 

26.  Dispute Resolution and Governing Laws

The parties will use their best efforts to resolve amicably any dispute, including use of alternative dispute resolution options.

This Agreement shall be governed by and construed in accordance with the laws and regulations of the United States of America as applied in the State of Florida.

All disputes shall be submitted to the exclusive jurisdiction of the courts of Palm Beach County, Florida.

 

27.  Changes

CLIENT may make or approve changes within the general Scope of Services in this AGREEMENT. If such changes affect ALTD’s cost of or time required for performance of the services, an equitable adjustment will be made through an amendment to this AGREEMENT.

 

 

 

 

 

 

ATTACHMENT 1 - Scope of Services

Altitude International Altitude Chamber -

Miami Dolphins Training Facility – Davie, FL

 

PROJECT DESCRIPTION

 

The Miami Dolphins Strength and Conditioning Facility is located in Davie, FL. The Team desires to add an altitude chamber to augment the capability of the facility and further their commitment to excellence in training and player rehabilitation fitness. This new facility will include an approximately [****] square foot simulated altitude room (hereinafter the “chamber”) within the existing “Sweat Box” area outside the building. The chamber will be developed using a stand-alone chamber design utilizing an aluminum frame with glass and acrylic panels as depicted on the attached Drawing 1. The Altitude International (ALTD) scope will be to manufacture, install, test and commission an Altitude Chamber as noted in further detail below.

 

General Performance Specifications: 

	 	
			●

				
			Nominal chamber volume: [****]

			

	 	
			●

				
			Simulated Altitude Capability: [****] feet

			

 

Project Notes: 

	 	
			●

				
			Project area located outside the existing building in an awning covered area.

			

	 	
			●

				
			Project area is approximately [****] consisting of a single room (see attached Drawing 1)

			

	 	
			●

				
			Chamber area will require the erection of a four sided aluminum framed glass & acrylic panel wall system and door structure and a ceiling structure of similar materials. Chamber ceiling height will be governed by existing building facilities (lighting, etc.)

			

	 	
			●

				
			A stand-alone recirculating air conditioning system will be installed by the CLIENT.

			

 

Protect Inclusions – The following items are included in the development of the Project.

 

	 	
			1.

				
			Erection of a four wall and ceiling glass and acrylic panel systems. System to include one double door entry.

			

	 	
			2.

				
			Installation of an Air Separation Unit (ASU) and Sensor Array

			

	 	
			3.

				
			Installation of a Human Machine Interface (HMI) Controller with Pre-Sets

			

	 	
			4.

				
			Installation of an air compressor for the altitude system

			

	 	
			5.

				
			Electrical hook-up for Chamber systems (see Owner Supplied Notes)

			

	 	
			6.

				
			Installation of a stand-alone A/C system to cool the chamber (see Owner Supplied Notes)

			

	 	
			7.

				
			Operational Training

			

MAJOR EQUIPMENT DESCRIPTION TO BE SUPPLIED & INSTALLED BY ALTD

 

	
			Qty./ Unit

				
			Description

			
	
			[****]

				
			[****]

			
	
			[****]

				
			[****]

			
	
			[****]

				
			[****]

			
	
			[****]

				
			[****]

			
	 	 

 

 

 

 

 

Primary Power Consumption (kW):

 

	
			Air Compressor/Dryer (3phase)

				
			11

			
	
			Air Conditioner System

				
			TBD (by Owner)

			

 

 

 

 

Foot Prints for Major Equipment (approximate in feet):

 

	
			ASU Control Panel (L x H x D) – wall mounted

				
			4 x 3 x 1

			
	
			Air Compressor/Dryer (L x W x H) – floor mounted

				
			5 x 2 x 5

			

 

 

CUSTOMER SUPPLIED ITEMS OR SERVICES

 

Utilities Required

 

	 	
			●

				
			Main Power: Separate main power supplies and disconnects – [***]

			

	 	
			●

				
			Minor Power: 110VAC single phase power oulets will be used for ASU/Control Panel power located next to the location of the ASU cabinet.

			

	 	
			●

				
			Grounding: Grounding for supplied equipment.

			

 

	 	
			●

				
			Drainage for AHU and air compressor condensate.

			

 

Site and Site Support

 

	 	
			●

				
			Facility support as required to locate lighting and other existing resources.

			

	 	
			●

				
			Plinth or paver foundation for air compressor

			

	 	
			●

				
			Site should be clear and leveled. On-site equipment placement support by Client.

			

	 	
			●

				
			Area for compressors and support equipment shall be made ready to accept all equipment. Location shall be covered from direct sunlight and weather

			

	 	
			●

				
			Purchase and isntallation of a suitable mini-split DX type air conditioning system

			

	 	
			●

				
			Electrical designation of the site should be non-hazardous. .

			

	 	
			●

				
			Site shall be available to ALTD authorized representatives and subcontractor personnel.

			

	 	
			●

				
			The use of Union labor will not be required.

			

	 	
			●

				
			Project permitting and fees if required.

			

 

 

 

 

 

 

 

 

 

 

Drainage Requirements

 

The compressor system includes an oil/water separator, which removes moisture from the air stream. This condensate water is contaminated with a small amount of oil carry over from the oil-lubricated compressors, which is fed to an oil/water separator (supplied) where this contamination is removed. The AHU evaporator also requires drainage of condensate. The resulting water needs to be fed to a Client supplied drainage system.

 

 

Site Access

 

Client shall give ALTD uninterupted access to the site for System installation. Installation may include hours other than normal operation times for the Client.

 

 

Installation

 

Client shall permit Altitude International staff, subcontractors or designates full rights for installation.

 

 

 

 

 

 

ATTACHMENT 2 - Compensation and Conditions of Payment

Altitude International Altitude Chamber -

Miami Dolphins Training Facility – Davie, FL

 

 

COMPENSATION

 

The total proposal price for the scope of services as per Attachment 1, Manufacture, Installation, Testing and Commissioning of an Altitude International Altitude Chamber is :

 

USD[****].

 

 

CONDITIONS OF PAYMENT

 

Compensation shall be paid by CLIENT to Altitude International Inc. as noted below:

 

 

1.      ADVANCE PAYMENT

 

Advance payment of[****]of the total PROPOSAL PRICE [****] shall be paid by the CLIENT by wire transfer to an ALTD designated bank account no later than [***] days after signature of the AGREEMENT by CLIENT and ALTD. Such advance payment shall be made against an ALTD invoice for the advance payment, which shall be submitted to the CLIENT within 24 hours after receipt of the executed AGREEMENT.

 

 

2.      PAYMENT PRIOR TO THE SHIPMENT OF ALTD SYSTEM

 

[****] of the total PROPOSAL PRICE [****] shall be paid by the CLIENT by wire transfer to ALTD prior to the shipment of equipment to the site.

 

Payment shall be made within [***] days after the presentation of the following documents:

	 	
			A.

				
			ALTD commercial invoice equivalent to [****] of PROPOSAL PRICE.

			

	 	
			B.

				
			Documentation of shipping confirmation

			

 

 

3.      PAYMENT UPON INSTALLATION

 

Upon installation, [****] of the total PROPOSAL PRICE [****] shall be paid by the CLIENT by wire transfer to ALTD at the completion of Installation.

 

Payment shall be made within [***] days after the presentation of the following documents:

	
			A.

				
			ALTD commercial invoice equivalent to [****] of PROPOSAL PRICE.

			

 

 

4.      PAYMENT UPON COMMISSIONING AND HAND OVER

 

At handover, [****] of the total Proposal Price [****] shall be paid by the CLIENT by wire transfer to ALTD after Commissioning and Hand Over.

 

Payment shall be made within [***] days after the presentation of the following documents:

	
			A.

				
			Completion certificate signed as a mark of acceptance by CLIENT’s nominated representative/Engineer.

			

	
			B.

				
			ALTD commercial invoice equivalent to [****] of PROPOSAL PRICE.

			

	
			C.

				
			User Manual and Warranty Information.

			

 

 

 

 

 

ATTACHMENT 3 - Schedule

Altitude International Altitude Chamber -

Miami Dolphins Training Facility – Davie, FL

 

 

Projected Schedule

 

	
			D.

				
			The projected schedule for the project is depicted on the below table. It should be noted that this schedule is predicated on starting on the identified Notice to Proceed date and timely approvals from permitting agencies and the client. The schedule is also driven by other products in the manufacturing pipeline at the time Notice to Proceed is given by the Client.

			

 

 

Projected Schedule

 

	
			Info

				
			Task Name

				
			Duration

				
			Start

				
			Finish

			
	
			1

				
			Contract Execution and NTP

				
			[****]

				
			[****]

				
			[****]

			
	
			2

				
			Procurement

				
			[****]

				
			[****]

				
			[****]

			
	
			3

				
			Manufacturing

				
			[****]

				
			[****]

				
			[****]

			
	
			4

				
			Civil Works

				
			[****]

				
			[****]

				
			[****]

			
	
			5

				
			Installation

				
			[****]

				
			[****]

				
			[****]

			
	
			6

				
			Commisioning and Hand Over

				
			[****]

				
			[****]

				
			[****]

			

 

 

 

 

 

 

 

 

ATTACHMENT 4 – Warranty, Maintenance and Service

Altitude International Altitude Chamber -

Miami Dolphins Training Facility – Davie, FL

 

 

 

WARRANTY

[****]

 

MAINTENANCE / SERVICE SCHEDULE

 

	 	
			●

				
			Regular maintenance consists of the replacement of filters and fluids and general cleaning of the ALTD and compressors systems. The filters and fluids to be changed as part of the regular maintenance program include those identified on the Service Schedule attached as part of this Section.

			

 

	 	
			●

				
			Extended maintenance may include such items as the oxygen sensors and ASU membranes. These items will be addressed as factory replacement items and should not be attempted by the client. With respect to longevity, the solid-state oxygen sensors should be calibrated every 12 months and can be checked regularly with a hand held analyzer to ensure calibration is maintained. These sensors should be replaced once they cannot hold calibration properly. ASU filter membranes are rated with a lifetime of approximately 10 years. Should a membrane become restricted or are past their rated lifetime, they should be replaced immediately. The air compressor will need routine service as specified by the manufacturer.Exhibit 4.1

 

FORM OF MCEWEN MINING WARRANT

 

WARRANT TO PURCHASE COMMON STOCK

 

Number of Shares:                                (subject to adjustment)

 

Warrant No.:

 

Original Issue Date: March       , 2019

 

McEwen Mining Inc., a Colorado corporation (the “Company”), hereby certifies that, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,                          , or its permitted registered assigns (the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company up to a total of                       shares of common stock, no par value per share (the “Common Stock”), of the Company (each such share, a “Warrant Share” and all such shares, the “Warrant Shares”) at an exercise price per share equal to US$2.00 per share (as adjusted from time to time as provided in Section 9 herein, the “Exercise Price”), upon surrender of this warrant to purchase Common Stock (including any warrants to purchase Common Stock issued in exchange, transfer or replacement hereof, the “Warrant”) at any time and from time to time on or after the date hereof (the “Original Issue Date”) and through and including 5:30 P.M., New York City time, on March    , 2022 (the “Expiration Date”), and subject to the following terms and conditions:

 

1.                                      Definitions. For purposes of this Warrant, the following terms shall have the following meanings:

 

(a)                                 “Affiliate” of any Person means any other Person directly or indirectly controlling, controlled by or under common control with such Person.

 

(b)                                 “Commission” means the United States Securities and Exchange Commission and any successor entity thereto.

 

(c)                                  “Closing Sale Price” means, for any security as of any date, the last trade price for such security on the Principal Trading Market for such security, as reported by Bloomberg Financial Markets, or, if such Principal Trading Market begins to operate on an extended hours basis and does not designate the last trade price, then the last trade price of such security immediately prior to 4:00 P.M., New York City time, as reported by Bloomberg Financial Markets, or if the foregoing do not apply, the last trade price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg Financial Markets, or, if no last trade price is reported for such security by Bloomberg Financial Markets, the average of the bid and ask prices of any market makers for such security as reported on OTC Pink (also known as the “pink sheets”) by the OTC Markets Group, Inc. If the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Sale Price of such security on such date shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then the Board of Directors of the Company shall use its good faith judgment to determine the fair market value of such security on such date. The Board of Directors’ determination shall be binding upon all parties absent demonstrable error. All

 

 

such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during the applicable calculation period.

 

(d)                                 “Person” means any natural person, corporation, firm, joint venture, partnership, limited liability company, association, enterprise, trust or other entity or organization, or any government or political subdivision or any agency, department or instrumentality thereof.

 

(e)                                  “Principal Trading Market” means the trading market on which the Common Stock is primarily listed on and quoted for trading, and which, as of the Original Issue Date shall be the New York Stock Exchange.

 

(f)                                   “Registration Statement” means the Company’s Registration Statement on Form S-3 (File No. 333-224476), as amended and supplemented from time to time, relating to the Warrants and the Warrant Shares, among other securities of the Company.

 

(g)                                  “Securities Act” means the Securities Act of 1933, as amended.

 

(h)                                 “Trading Day” means a day on which the Principal Trading Market is open for trading.

 

(i)                                     “Transfer Agent” means Computershare Trust Company, the Company’s transfer agent for the Common Stock, and the Company or its designee, with respect to the Warrants.

 

2.                                      Registration of Warrants. The Company shall, or shall cause its Transfer Agent to, register this Warrant, upon records to be maintained by the Company or Transfer Agent for that purpose (the “Warrant Register”), in the name of the record Holder (which shall include the initial Holder or, as the case may be, any registered assignee to which this Warrant is permissibly assigned hereunder) 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.

 

3.                                      Registration of Transfers. Subject to compliance with all applicable securities laws, the Company shall, or shall cause its Transfer Agent to, register the transfer of all or any portion of this Warrant in the Warrant Register, upon surrender of this Warrant, and payment of all applicable transfer taxes. Upon any such registration of transfer, a new warrant to purchase Common Stock in substantially the form of this Warrant (any such new warrant, a “New Warrant”) evidencing the portion of this Warrant so transferred shall be issued to the transferee, and a New Warrant evidencing the remaining portion of this Warrant not so transferred, if any, shall be issued to the transferring Holder. The acceptance of the New Warrant by the transferee thereof shall be deemed the acceptance by such transferee of all of the rights and obligations in respect of the New Warrant that the Holder had in respect of this Warrant. The Company shall, or shall cause its Transfer Agent to, prepare, issue and deliver at the Company’s own expense any New Warrant under this Section 3. Until due presentment for registration of transfer, the Company may treat the registered Holder hereof as the owner and holder of this Warrant for all purposes, and the Company shall not be affected by any notice to the contrary.

 

4.                                      Exercise and Duration of Warrants.

 

(a)                                 All or any part of this Warrant shall be exercisable by the registered Holder in any manner permitted by this Warrant at any time and from time to time on or after the Original Issue Date and through and including 5:30 P.M. New York City time, on the Expiration Date. At 5:30 P.M., New York City time, on the Expiration Date, the portion

 

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of this Warrant not exercised prior thereto shall be void and of no value and this Warrant shall terminate and no longer be outstanding.

 

(b)                                 The Holder may exercise this Warrant by delivering to the Company an exercise notice, in the form attached as Schedule 1 hereto (the “Exercise Notice”), completed and duly signed. Within two Trading Days following the date of exercise as aforesaid, the Holder shall pay the Exercise Price for the number of Warrant Shares as to which this Warrant is being exercised (unless such exercise is in the form of a “net share exercise” if so indicated in the Exercise Notice pursuant to Section 10 below). The date on which the Exercise Notice is delivered to the Company (as determined in accordance with the notice provisions hereof) is an “Exercise Date.” The Holder shall not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise Notice shall have the same effect as cancellation of the original Warrant and issuance of a New Warrant to the Holder evidencing its right to purchase the remaining number of Warrant Shares. No ink-original Exercise Notice shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Exercise Notice be required. 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 Exercise Notice within one (1) Business Day of 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 the avoidance of doubt, the Company may not substitute, and the Holder may not request, a cash payment in satisfaction of the Company’s obligation to issue and deliver Warrant Shares pursuant to an Exercise Notice, other than as specified in Sections 9(c) or 12 of this Warrant.

 

5.                                      Delivery of Warrant Shares.

 

(a)                                 Mechanics of Delivery. Upon exercise of this Warrant, the Company shall promptly (but in no event later than two (2) Trading Days after the Exercise Date) (“Warrant Share Delivery Date”), credit such aggregate number of shares of Common Stock to which the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account with The Depository Trust Company (“DTC”) through its Deposit Withdrawal Agent Commission system, or if the Transfer Agent is not participating in the Fast Automated Securities Transfer Program (the “FAST Program”) or if the certificates are required to bear a legend regarding restriction on transferability, issue and dispatch by overnight courier to the address as specified in the Exercise Notice, a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder is entitled pursuant to such exercise. Upon delivery of the Exercise Notice, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received within two (2) Trading Days following delivery of the Exercise Notice. The Holder, or any Person permissibly so designated by the Holder to receive Warrant Shares, shall be deemed to have become the holder of record of such Warrant Shares as of the Exercise Date, irrespective of the date such Warrant Shares are credited to the Holder’s DTC account or the date of delivery of the certificates evidencing such Warrant Shares, as the case may be.

 

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(b)                                 Unconditional Obligation. To the extent permitted by law, the Company’s obligations to issue and deliver Warrant Shares in accordance with and subject to the terms hereof (including the limitations set forth in Section 11 below) are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation of law by the Holder or any other Person, and irrespective of any other circumstance that might otherwise limit such obligation of the Company to the Holder in connection with the issuance of Warrant Shares. The Company agrees to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. Nothing herein shall limit the Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

 

(c)                                  Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 5(a) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

 

6.                                      Charges, Taxes and Expenses. Issuance and delivery of certificates for shares of Common Stock upon exercise of this Warrant shall be made without charge to the Holder for any issue or transfer tax, transfer agent fee or other incidental tax or expense in respect of the issuance of such certificates, all of which taxes and expenses shall be paid by the Company; provided, however, that the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the registration of any certificates for Warrant Shares or the Warrants in a name other than that of the Holder or an Affiliate thereof. The Holder shall be responsible for all other tax liability that may arise as a result of holding or transferring this Warrant or receiving Warrant Shares upon exercise hereof.

 

7.                                      Replacement of Warrant. If this Warrant is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation hereof, or in lieu of and substitution for this Warrant, a New Warrant, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction (in such case) and, in each case, a customary and reasonable indemnity (but shall not include the posting of any surety bond), if requested by the Company. Applicants for a New Warrant under such circumstances shall also comply with such other reasonable regulations and procedures and pay such other reasonable third-party costs as the Company may prescribe. If a New Warrant is requested as a result of a mutilation of this Warrant, then the Holder shall deliver such mutilated Warrant to the Company as a condition precedent to the Company’s obligation to issue the New Warrant.

 

8.                                      Reservation of Warrant Shares. The Company covenants that it will at all times while this Warrant is outstanding reserve and keep available out of the aggregate of its authorized but unissued and otherwise unreserved Common Stock, solely for the purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as herein provided, the number of Warrant Shares that are initially issuable and deliverable upon the exercise of this entire Warrant, free from pre-emptive rights or any other contingent purchase rights of persons other than the Holder (taking into account the adjustments of Section 9 but ignoring for such purposes any restrictions on exercise under this Warrant). The Company covenants that all Warrant Shares so issuable and

 

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deliverable shall, upon issuance and the payment of the applicable Exercise Price in accordance with the terms hereof, be duly and validly authorized and issued, and fully paid and non-assessable. The Company will take all such action as may be reasonably necessary to assure that such shares of Common Stock may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of any securities exchange or automated quotation system upon which the Common Stock may be listed.

 

9.                                      Certain Adjustments. The Exercise Price and number of Warrant Shares issuable upon exercise of this Warrant are subject to adjustment from time to time as set forth in this Section 9.

 

(a)                                 Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding, (i) pays a stock dividend on its Common Stock or otherwise makes a distribution on any class of capital stock that is payable in shares of Common Stock, (ii) subdivides its outstanding shares of Common Stock into a larger number of shares of Common Stock, (iii) combines its outstanding shares of Common Stock into a smaller number of shares of Common Stock or (iv) issues by reclassification of shares of capital stock any additional shares of Common Stock of the Company, then in each such case the Exercise Price shall be multiplied by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding immediately before such event and the denominator of which shall be the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to clause (i) of this paragraph shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution; provided, however, that if such record date shall have been fixed and such dividend is not fully paid on the date fixed therefor, the Exercise Price shall be recomputed accordingly as of the close of business on such record date and thereafter the Exercise Price shall be adjusted pursuant to this paragraph as of the time of actual payment of such dividends. Any adjustment pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately after the effective date of such subdivision or combination.

 

(b)                                 Pro Rata Distributions. If the Company, at any time while this Warrant is outstanding, distributes to all holders of Common Stock for no consideration (i) evidences of its indebtedness, (ii) any security (other than a distribution of Common Stock covered by the preceding paragraph) or (iii) rights or warrants to subscribe for or purchase any security, or (iv) any other asset (in each case, “Distributed Property”), then, upon any exercise of this Warrant that occurs after the record date fixed for determination of stockholders entitled to receive such distribution, the Holder shall be entitled to receive, in addition to the Warrant Shares otherwise issuable upon such exercise (if applicable), the Distributed Property that such Holder would have been entitled to receive in respect of such number of Warrant Shares had the Holder been the record holder of such Warrant Shares immediately prior to such record date without regard to any limitation on exercise contained therein.

 

(c)                                  Right Offerings. In addition to any adjustments pursuant to Section 9(a) above, if at any time the Company grants, issues or sells any securities that are convertible or exercisable or exchangeable for Common Stock (“Common Stock Equivalents”) or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without

 

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regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation as defined in Section 11) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, that, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

(d)                                 Fundamental Transactions. If, at any time while this Warrant is outstanding (i) the Company effects any merger or consolidation of the Company with or into another Person, in which the Company is not the surviving entity or the stockholders of the Company immediately prior to such merger or consolidation do not own, directly or indirectly, at least 50% of the voting power of the surviving entity immediately after such merger or consolidation, (ii) the Company effects any sale to another Person of all or substantially all of its assets in one or a series of related transactions, (iii) pursuant to any tender offer or exchange offer (whether by the Company or another Person), holders of capital stock who tender shares representing more than 50% of the voting power of the capital stock of the Company and the Company or such other Person, as applicable, accepts such tender for payment, (iv) the Company consummates a stock purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person whereby such other Person acquires more than the 50% of the voting power of the capital stock of the Company or (v) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (other than as a result of a subdivision or combination of shares of Common Stock covered by Section 9(a) above) (in any such case, a “Fundamental Transaction”), then following such Fundamental Transaction the Holder shall have the right to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Warrant Shares then issuable upon exercise in full of this Warrant without regard to any limitations on exercise contained herein (the “Alternate Consideration”). The Company shall not effect any Fundamental Transaction in which the Company is not the surviving entity or the Alternate Consideration includes securities of another Person unless prior to or simultaneously with the consummation thereof, any successor to the Company, surviving entity or other Person (including any purchaser of assets of the Company) shall assume the obligation to deliver to the Holder, such Alternate Consideration as, in accordance with the foregoing provisions, the Holder may be entitled to receive, and the other obligations under this Warrant.

 

(e)                                  Number of Warrant Shares. Simultaneously with any adjustment to the Exercise Price pursuant to paragraph (a) of this Section 9, the number of Warrant Shares that may be purchased upon exercise of this Warrant shall be increased or decreased proportionately, so that after such adjustment the aggregate Exercise Price payable hereunder for the

 

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increased or decreased number of Warrant Shares shall be the same as the aggregate Exercise Price in effect immediately prior to such adjustment.

 

(f)                                   Calculations. All calculations under this Section 9 shall be made to the nearest cent or the nearest share, as applicable.

 

(g)                                  Notice of Adjustments. Upon the occurrence of each adjustment pursuant to this Section 9, the Company at its expense will, at the written request of the Holder, promptly compute such adjustment, in good faith, in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment, including a statement of the adjusted Exercise Price and adjusted number or type of Warrant Shares or other securities issuable upon exercise of this Warrant (as applicable), describing the transactions giving rise to such adjustments and showing in detail the facts upon which such adjustment is based. Upon written request, the Company will promptly deliver a copy of each such certificate to the Holder and to the Company’s transfer agent.

 

(h)                                 Notice of Corporate Events. If, while this Warrant is outstanding, the Company (i) declares a dividend or any other distribution of cash, securities or other property in respect of its Common Stock, including, without limitation, any granting of rights or warrants to subscribe for or purchase any capital stock of the Company or any subsidiary, (ii) authorizes or approves, enters into any material definitive agreement contemplating or solicits stockholder approval for any Fundamental Transaction or (iii) authorizes the voluntary dissolution, liquidation or winding up of the affairs of the Company, then, except if such notice and the contents thereof shall be deemed to constitute material non-public information, the Company shall deliver to the Holder a notice of such transaction at least ten (10) days prior to the applicable record or effective date on which a Person would need to hold Common Stock in order to participate in or vote with respect to such transaction; provided, however, that the failure to deliver such notice or any defect therein shall not affect the validity of the corporate action required to be described in such notice. In addition, if while this Warrant is outstanding, if the Company enters into any material definitive agreement contemplating or solicits stockholder approval for any Fundamental Transaction contemplated by Section 9(d), other than a Fundamental Transaction under clause (iii) of Section 9(d), the Company shall deliver to the Holder a notice of such Fundamental Transaction at least fifteen (15) days prior to the date such Fundamental Transaction is consummated. To the extent that any notice provided pursuant to this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Holder shall keep such information confidential until the Company shall file such notice with the Commission pursuant to a Current Report on Form 8-K.

 

10.                               Limited Cashless Exercise. If the Registration Statement (or any subsequent registration statement applicable to the Warrant Shares) permitting the registered issuance of the Warrant Shares is not then effective or the prospectus forming a part thereof is not then available, then the Holder shall be entitled to utilize cashless exercise, in which event the Company shall issue to the Holder the number of Warrant Shares determined as follows (a “Cashless Exercise”):

 

X = Y [(A-B)/A]

 

where:

 

“X”                           equals the number of Warrant Shares to be issued to the Holder;

 

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“Y”                           equals the total number of Warrant Shares that would be issuable upon exercise of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise;

 

“A”                           the Closing Sale Price on the Trading Day immediately preceding the date on which Holder elects to exercise this Warrant by means of a “cashless exercise,” as set forth in the applicable Exercise Notice; and

 

“B”                           equals the Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise.

 

If Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised. The Company agrees not to take any position contrary to this Section 10.

 

11.                               Limitations on Exercise. 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 5 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Exercise Notice, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)), 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 and Attribution Parties 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 (i) exercise of the remaining, non-exercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or non-converted 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 or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 11, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (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 11 applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of an Exercise Notice 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 Attribution Parties) 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 11, 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 (A) the Company’s most recent periodic or annual report filed with the Commission,

 

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as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the 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 one Trading Day confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) 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 notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 11, 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 11 shall continue to apply. Any increase in the Beneficial Ownership Limitation 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 11 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. This Section 11 shall not restrict the number of shares of Common Stock which a Holder may receive or beneficially own in order to determine the amount of securities or other consideration that such Holder may receive in the event of a Fundamental Transaction as contemplated in Section 9 of this Warrant.

 

12.                               [reserved]

 

13.                               No Fractional Shares. No fractional Warrant Shares will be issued in connection with any exercise of this Warrant. In lieu of any fractional shares that would otherwise be issuable, the number of Warrant Shares to be issued shall be rounded down to the next whole number and the Company shall pay the Holder in cash the fair market value (based on the Closing Sale Price) for any such fractional shares.

 

14.                               Notices. Any and all notices or other communications or deliveries hereunder (including, without limitation, any Exercise Notice) shall be in writing and shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile or confirmed e-mail at the facsimile number or e-mail address specified in the books and records of the Transfer Agent prior to 5:30 P.M., New York City time, on a Trading Day, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile or confirmed e-mail at the facsimile number or e-mail address specified in the books and records of the Transfer Agent on a day that is not a Trading Day or later than 5:30 P.M., New York City time, on any Trading Day, (iii) the Trading Day following the date of mailing, if sent by nationally recognized overnight courier service specifying next business day delivery, or (iv) upon actual receipt by the Person to whom such notice is required to be given, if by hand delivery.

 

15.                               Warrant Agent. The Company shall initially serve as warrant agent under this Warrant. Upon thirty (30) days’ notice to the Holder, the Company may appoint a new warrant agent. Any

 

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corporation into which the Company or any new warrant agent may be merged or any corporation resulting from any consolidation to which the Company or any new warrant agent shall be a party or any corporation to which the Company or any new warrant agent transfers substantially all of its corporate trust or shareholders services business shall be a successor warrant agent under this Warrant without any further act. Any such successor warrant agent shall promptly cause notice of its succession as warrant agent to be mailed (by first class mail, postage prepaid) to the Holder at the Holder’s last address as shown on the Warrant Register.

 

16.                               Miscellaneous.

 

(a)                                 No Rights as a Stockholder. Except as expressly set forth in Section 9, the Holder, solely in such Person’s capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person’s capacity as the Holder of this Warrant, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, amalgamation, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.

 

(b)                                 Authorized Shares.

 

(i)                                     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 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 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 non-assessable 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.

 

(ii)                                  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.

 

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(c)                                  Successors and Assigns. Subject to the restrictions on transfer set forth in this Warrant and compliance with applicable securities laws, this Warrant may be assigned by the Holder. This Warrant may not be assigned by the Company without the written consent of the Holder except to a successor in the event of a Fundamental Transaction. This Warrant shall be binding on and inure to the benefit of the Company and the Holder and their respective successors and assigns. Subject to the preceding sentence, nothing in this Warrant shall be construed to give to any Person other than the Company and the Holder any legal or equitable right, remedy or cause of action under this Warrant.

 

(d)                                 Amendment and Waiver. Except as otherwise provided herein, the provisions of this Warrant may be amended and the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the written consent of the Holder of this Warrant.

 

(e)                                  Acceptance. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein.

 

(f)                                   Governing Law; Jurisdiction. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF. EACH OF THE COMPANY AND THE HOLDER HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED HEREIN, AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH COURT. NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW. EACH OF THE COMPANY AND THE HOLDER HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY.

 

(g)                                  Headings. The headings herein are for convenience only, do not constitute a part of this Warrant and shall not be deemed to limit or affect any of the provisions hereof.

 

(h)                                 Severability. In case any one or more of the provisions of this Warrant shall be invalid or unenforceable in any respect, the validity and enforceability of the remaining terms and provisions of this Warrant shall not in any way be affected or impaired thereby, and the Company and the Holder will attempt in good faith to agree upon a valid and enforceable provision which shall be a commercially reasonable substitute therefor, and upon so agreeing, shall incorporate such substitute provision in this Warrant.

 

(i)                                     Entire Agreement. This Warrant constitutes the entire agreement and understanding of the Company and the Holder with respect to the subject matter hereof and supersedes all prior agreements and understandings relating to the subject matter hereof.

 

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

 

 

	
 
    	
McEWEN MINING INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

 

Schedule1

 

FORM OF EXERCISE NOTICE

 

To:          McEwen Mining Inc.

 

Ladies and Gentlemen:

 

(1)                                 The undersigned is the Holder of Warrant No.                      (the “Warrant”) issued by McEwen Mining Inc., a Colorado corporation (the “Company”). Capitalized terms used herein and not otherwise defined herein have the respective meanings set forth in the Warrant.

 

(2)                                 The undersigned hereby exercises its right to purchase                         Warrant Shares pursuant to the Warrant.

 

(3)                                 The Holder intends that payment of the Exercise Price shall be made as (check one or both):

 

o                                    a “cash exercise” with respect to                             Warrant Shares; and/or

 

o                                    a “Cashless Exercise” pursuant to and subject to the conditions set forth in Section 10 of the Warrant with respect to                           Warrant Shares.

 

(4)                                 In the event that the Holder has elected a “cash exercise” with respect to some or all of the Warrant Shares, the Holder shall pay the Exercise Price in the sum of $                                 to the Company in accordance with the terms of the Warrant.

 

(5)                                 Pursuant to this Exercise Notice, the Company shall deliver to the Holder Warrant Shares determined in accordance with the terms of the Warrant. Please issue (check applicable box):

 

o                                    A certificate of certificates representing the Holder’s Warrant Shares in the name of the undersigned or in the following name: _______________________________________________________________________________

 

o                                    The Holder’s Warrant Shares in electronic form to the following account:

 

	
Name and Contact for Broker:
    	
 
    
	
 
    	
 
    
	
Broker no:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Account no:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Account holder:
    	
 
    	
 
    

 

(6)                                 By its delivery of this Exercise Notice, the undersigned represents and warrants to the Company that in giving effect to the exercise evidenced hereby the Holder will not beneficially own in excess of the number of shares of Common Stock (as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended) permitted to be owned under Section 11 of the Warrant to which this notice relates.

 

 

	
Dated:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name of Holder:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    
						

 

(Signature must conform in all respects to name of Holder as specified on the face of the Warrant)

 

2

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