Document:

ex_10-1.htm

 

 

EXHIBIT 10.1

WARRANT AGENT AGREEMENT

 

FIXED INCOME TRUST FOR PRUDENTIAL FINANCIAL, INC. NOTES,

SERIES 2012-1

 

WARRANT AGENT AGREEMENT, dated as of June 11, 2012 (the “Warrant Agent Agreement” or the “Agreement”), by and between FIXED INCOME CLIENT SOLUTIONS LLC, a Delaware limited liability company, as Depositor (the “Depositor”), THE BANK OF NEW YORK MELLON, as Trustee (the “Trustee”) and THE BANK OF NEW YORK MELLON, as Warrant Agent (the “Warrant Agent”).

 

WITNESSETH:

 

WHEREAS, concurrently with the execution of this Agreement, the Depositor and the Trustee are creating the Fixed Income Trust for Prudential Financial, Inc. Notes, Series 2012-1 (the “Trust”), a trust being created under the laws of the State of New York pursuant to a Base Trust Agreement, dated as of June 11, 2012 (the “Base Trust Agreement”), between the Depositor and the Trustee, as supplemented by the Trust Agreement Supplement 2012-1, dated as of June 11, 2012 (the “Series Supplement” and, together with the Base Trust Agreement, the “Trust Agreement”), between the Depositor and the Trustee; and

 

WHEREAS, all representations, covenants and agreements made herein by the Depositor, the Warrant Agent and the Trustee are for the benefit and security of the Warrantholders (as defined in Article I).

 

WHEREAS, in connection with the creation of the Trust and the deposit therein of the Underlying Securities, and in consideration therefor, it is desired to provide for the issuance of trust certificates (the “Certificates”) evidencing undivided interests in the Trust and 50 call warrants with respect to the Underlying Securities, each relating to (i) call options with respect to $505,000 principal amount of the Underlying Securities per Call Warrant and (ii) the right to receive the Warrantholder Allocation Amounts (as defined in the Series Supplement) (the “Call Warrants”).

 

NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants expressed herein, it is hereby agreed by and among the Depositor, the Trustee and the Warrant Agent as follows:

 

 

ARTICLE I

 

Exercise of Warrants

 

            Section 1.1.     Manner of Exercise.  Each of the Call Warrants may be exercised by the holder thereof (each, a “Warrantholder”), on any Warrant Exercise Date.  Each Call Warrant may be exercised in whole but not in part.  The “Called Underlying Securities” shall be

 

 

 

 

 

  

  

  

Underlying Securities having a principal amount equal to $505,000 per exercised Call Warrant.  The following conditions shall apply to any exercise of the Call Warrants:

 

(i)     A written notice in the form of Exhibit I attached to the Call Warrants (the “Call Notice”) specifying the number of Call Warrants being exercised and the Warrant Exercise Date shall be delivered to the Warrant Agent and the Trustee at least 10 but not greater than 60 days before such Warrant Exercise Date.

 

    (ii)    The Warrantholder shall surrender the Call Warrants to the Warrant Agent at its office specified in Section 6.3 hereof no later than 10:00 a.m. (New York City time) on such Warrant Exercise Date.

 

    (iii)   Except in connection with a Call Notice relating to a tender offer for Underlying Securities where the called Underlying Securities cannot be delivered to the relevant Warrantholder due to time constraints or other restrictions relating to such tender, which shall be settled as set forth in Section 10(h) of the Series Supplement, the Warrantholder shall have made payment to the Warrant Agent, by wire transfer or other immediately available funds acceptable to the Warrant Agent, in the amount of the Warrant Exercise Purchase Price for the exercised Call Warrants, no later than 11:00 a.m. (New York City time) on the Warrant Exercise Date and shall have delivered in connection with its payment, an executed subscription for the Underlying Securities in the form of Exhibit II attached to the Call Warrants.

 

(iv)   The Warrantholder shall have satisfied all conditions to the exercise of Call Warrants set forth in Section 8 of the Series Supplement.

 

    Upon exercise of the Call Warrants, the Warrantholder shall be entitled to delivery of the Called Underlying Securities.

 

(a)    The Warrant Agent shall notify the Trustee immediately upon receipt by the Warrant Agent of a notice by the holder of the Call Warrants and upon receipt of payment of the applicable Warrant Exercise Purchase Price from such holder pursuant to clause (a) of this Section 1.1.  The Warrant Agent shall transfer each payment made by the holder thereof pursuant to clause (a) of this Section 1.1 to the Trustee in immediately available funds, for application pursuant to the Trust Agreement no later than 1:00 p.m. (New York City time) on the applicable Warrant Exercise Date (and, pending such transfer, shall hold each such payment for the benefit of the holder thereof in a segregated trust account).

 

(b)    A notice by the holder of a Call Warrant does not impose any obligations on a holder of a Call Warrant in any way to pay any Warrant Exercise Purchase Price.  If, by 11:00 a.m. (New York City time) on the Warrant Exercise Date, the holder of the Call Warrant being exercised has not paid the Warrant Exercise Purchase Price (except in connection with a Call Notice relating to a tender offer for Underlying Securities that will not be delivered to the relevant Warrantholder), then such notice shall automatically expire and none of the holders of such Call Warrant, the Warrant Agent and the Trustee 

 

 

 

 

  

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           shall have any obligations with respect to such notice by the holder of such Call Warrant.  The expiration of a notice by the holder of this Call Warrant shall in no way affect a holder of a Call Warrant’s right to subsequently deliver a notice which satisfies the terms of the Trust Agreement.  The Warrant Exercise Purchase Price for a call in connection with a tender offer shall be deducted from the proceeds of a tender offer by the Trust pursuant to Section 10(h) of the Series Supplement.

 

(c)                If at any time a Trust Reporting Event occurs and is continuing, Warrantholders will have the right to exercise the Call Warrants so long as the Warrant Exercise Date has occurred and the Call Warrants are exercised prior to the liquidation or distribution of the Underlying Securities.

 

            Section 1.2.        Transfer of Underlying Securities.  As soon as practicable after each surrender of the Call Warrants, and no later than 11:30 a.m. (New York City time) on the Warrant Exercise Date and upon satisfaction of all other requirements described in the Call Warrants, the Warrant Agent shall instruct the Trustee to cause the Called Underlying Securities represented by the number of Warrants being exercised hereunder to be registered on the book-entry system of the related depositary in the registered name or names furnished by the holder, and, in case such exercise is of less than all of the Call Warrants, new Call Warrants of like tenor, representing the remaining unexercised and outstanding Call Warrants of the holder, shall be delivered by the Warrant Agent to the holder thereof; provided, however, that if such Call Notice is in connection with a tender offer and the called Underlying Securities cannot be delivered to the relevant Warrantholder due to time constraints or other restrictions relating to such tender, the Warrant Agent shall instruct the Trustee to distribute to the exercising Warrantholder the excess of the tender offer proceeds over the Call Price pursuant to Section 10(h) of the Series Supplement.  The Trustee shall cause the delivery of the Called Underlying Securities to the holder or its nominee no later than 12:00 p.m. (New York City time) on the applicable Warrant Exercise Date in accordance with Section 8(d) of the Series Supplement.

 

            Section 1.3.        Cancellation and Destruction of Call Warrant.  All Call Warrants surrendered to the Warrant Agent for the purpose of exercise pursuant to Section 1.1 and actually exercised, or for the purpose of transfer or exchange pursuant to Article III, shall be cancelled by the Warrant Agent, and no Call Warrant (other than that reflecting such transfer or exchange) shall be issued in lieu thereof.  The Warrant Agent shall destroy all cancelled Call Warrants.

 

            Section 1.4.        No Rights as Holder of Underlying Securities Conferred by Warrants.  Prior to the exercise thereof, the Call Warrants shall not entitle the holder thereof to any of the rights of a holder of the Underlying Securities, including, without limitation, the right to receive the payment of any amount on or in respect of the Underlying Securities or to enforce any of the covenants of the Trust Agreement.

 

 

 

 

 

 

  

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ARTICLE II

 

Restrictions on Transfer

 

            Section 2.1.  Restrictive Legends.  The Call Warrants may not be transferred except to a transferee whom the transferor of the Call Warrants reasonably believes is (A) a “Qualified Institutional Buyer” (as defined in Rule 144A under the Securities Act) and (B) acquiring the Call Warrants for its own account or for the account of an investor of the type described in clause (A) above as to which the transferee exercises sole investment discretion.  In addition, each transferee shall be required to deliver to the Warrant Agent an investment letter in the form of Exhibit III attached to the Call Warrants.

 

Except as otherwise permitted by this Article II, the Call Warrants (or the Call Warrants issued upon the transfer of the Call Warrants) shall be issued with a legend in substantially the following form:

 

“These Call Warrants have not been registered under the Securities Act of 1933, as amended and may not be transferred, sold or otherwise disposed of except while a registration under such Act is in effect or pursuant to the exemption therefrom under such Act provided pursuant to Rule 144A thereunder.  The Call Warrants represented hereby may be transferred only in compliance with the conditions specified in these Call Warrants including the delivery of an Investment Letter in the form attached hereto.  Each prospective transferee of these Call Warrants shall be required to represent that it is (A) a “Qualified Institutional Buyer” (as defined in Rule 144A) and (B) acquiring the Call Warrants for its own account or for the account of an investor of the type described in clause (A) above as to which the transferee exercises sole investment discretion.”

 

            Section 2.2.   Notice of Proposed Transfer.  Prior to any transfer of any Call Warrant, the holder thereof will give five (5) Business Days (or such lesser period acceptable to the Warrant Agent) prior written notice to the Warrant Agent of such holder’s intention to effect such transfer and to comply in all other respects with this Section 2.2.  Each transfer of Call Warrants must be for a whole number of Call Warrants.

 

ARTICLE III

 

Registration and Transfer of Call Warrants, etc.

 

            Section 3.1.   Warrant Register; Ownership of Call Warrants.  The Warrant Agent will keep a register in which the Warrant Agent will provide for the registration of Call Warrants and the registration of transfers of Call Warrants representing whole numbers of Call Warrants.  The Trustee and the Warrant Agent may treat the Person in whose name any Call Warrant is registered on such register as the owner thereof for all purposes, and the Trustee and the Warrant Agent shall not be affected by any notice to the contrary.

 

    Section 3.2.   Transfer and Exchange of Call Warrants.  Upon surrender of any Call Warrant for registration of transfer or for exchange to the Warrant Agent, the Warrant Agent 

 

 

 

 

 

  

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shall (subject to compliance with Article II) execute and deliver, and cause the Trustee, on behalf of the Trust, to execute and deliver, in exchange therefor, a new Call Warrant of like tenor and evidencing a like number of Call Warrants, in the name of such holder or as such holder (upon payment by such holder of any applicable transfer taxes or government charges) may direct.  The Call Warrants must be transferred in a minimum amount of $505,000.

 

    Section 3.3.    Replacement of Call Warrants.  Upon receipt of evidence reasonably satisfactory to the Warrant Agent of the loss, theft, destruction or mutilation of any Call Warrant and, in the case of any such loss, theft or destruction of any Call Warrant, upon delivery of an indemnity bond in such reasonable amount as the Warrant Agent may determine, or, in the case of any such mutilation, upon the surrender of such Call Warrant for cancellation to the Warrant Agent, the Warrant Agent shall execute and deliver, and cause the Trustee, on behalf of the Trust, to execute and deliver, in lieu thereof, a new Call Warrant of like tenor bearing a number not contemporaneously outstanding.

 

    Section 3.4.   Execution and Delivery of Call Warrants.  The Warrant Agent hereby agrees (subject to compliance with Article II) to execute and deliver any new Call Warrants issued in accordance with Section 1.2 or this Article III and the Trustee, on behalf of the Trust, shall further execute by acknowledgement thereon any such Call Warrants as the Warrant Agent shall request in accordance herewith.

 

ARTICLE IV

 

Definitions

 

As used herein, unless the context otherwise requires, the following terms have the following respective meanings:

 

“Business Day”:  As defined in the Trust Agreement.

 

“Call Warrant”:  As defined in the Recitals hereof.

 

“Certificateholder” or “Holder”:  With respect to any Certificate, the holder thereof.

 

“Certificates”:  As defined in the Trust Agreement.

 

“Closing Date”:  June 11, 2012.

 

“Called Underlying Securities”:  As defined in Section 1.1(a) hereof.

 

“Depositor”:  As defined in the Recitals hereof, or any successor thereto under the Trust Agreement.

 

 

 

 

 

  

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“Person”:  Any individual, corporation, partnership, joint venture, association, joint stock company, trust (including any beneficiary thereof), unincorporated organization or government or any agency or political subdivision thereof.

 

“Hired NRSRO”:  Standard & Poor’s Ratings Services, a Division of the McGraw Hill Companies, Inc. and any successor thereto.

 

“Responsible Officer”:  As defined in the Trust Agreement.

 

“Securities Act”:  The Securities Act of 1933, or any similar federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.

 

“Trust”:  As defined in the Recitals hereof.

 

“Trust Agreement”:  The Base Trust Agreement, dated as of June 11, 2012, between the Depositor and the Trustee, as supplemented by the Trust Agreement Supplement, Series 2012-1, dated as of June 11, 2012, between the Depositor and the Trustee, incorporating by reference the definitions and assumptions thereto, as the same may be amended or modified from time to time.

 

“Trust Reporting Event”:  If (1) the Underlying Securities Issuer (as defined in the Series Supplement) either (x) states in writing that it intends permanently to cease filing periodic reports required under the Securities Exchange Act of 1934 or (y) fails to file all required periodic reports for any applicable reporting period, and (2) the Depositor determines after consultation with the Securities and Exchange Commission (the “Commission”) that under applicable securities laws, rules or regulations the Trust must be liquidated or the Underlying Securities distributed.

 

“Trustee”:  As defined in the Recitals hereof, or any successor thereto under the Trust Agreement.

 

“Underlying Securities Issuer”:  As defined in the Trust Agreement.

 

“Underlying Securities”:  As defined in the Trust Agreement.

 

“Warrant Agent”:  The Bank of New York Mellon, a New York banking corporation, in its capacity as warrant agent hereunder, or any successor thereto hereunder.

 

“Warrant Exercise Date”:  Any Business Day on or after June 1, 2017, as specified in the notice from the Warrantholder to the Warrant Agent and the Trustee.

 

“Warrant Exercise Purchase Price”:  An amount paid by the Warrantholder on each Warrant Exercise Date equal to 100% of the principal amount of the Underlying

 

 

 

 

 

  

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Securities being purchased pursuant to the exercise of the Call Warrants, in each case, plus accrued and unpaid interest to and including the Warrant Exercise Date.

 

Capitalized terms used but not defined herein have the meanings assigned to them in the Trust Agreement.

 

ARTICLE V

 

Warrant Agent

 

            Section 5.1.    Limitation on Liability.  The Warrant Agent shall be protected against, and shall incur no, liability for or in respect of any action taken, suffered or omitted by it in connection with its administration of the Call Warrants in reliance upon any instrument of assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, direction, consent, certificate, statement or other paper or document in good faith believed by it to be genuine and to be signed, executed and, where necessary, verified and acknowledged, by the proper Person or Persons; unless a court of competent jurisdiction enter in a non-appealable judgment that such liability resulted from the gross negligence or willful misconduct of the Warrant Agent.

 

            Section 5.2.    Duties of Warrant Agent.  The Warrant Agent undertakes only the specific duties and obligations imposed hereunder upon the following terms and conditions, by all of which the Depositor, the Trust, the Trustee and each Warrantholder shall be bound:

 

(a)     The Warrant Agent may consult with legal counsel (who may be legal counsel for the Depositor), and the opinion of such counsel shall be full and complete authorization and protection to the Warrant Agent as to any action taken or omitted by it in good faith and in accordance with such opinion, provided the Warrant Agent shall have exercised reasonable care in the selection by it of such counsel.

 

(b)     Whenever in the performance of its duties hereunder, the Warrant Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Depositor or the Trustee prior to taking or suffering any action hereunder, such fact or matter may be deemed to be conclusively proved and established by a certificate signed by a Responsible Officer of the Trustee and delivered to the Warrant Agent; and such certificate shall be full authorization to the Warrant Agent for any action taken or suffered in good faith by it hereunder in reliance upon such certificate.

 

(c)     The Warrant Agent shall be liable hereunder only for its own gross negligence, willful misconduct or bad faith.

 

(d)     The Warrant Agent shall not be liable for or by reason of any of the statements of fact or recitals contained herein or be required to verify the same, but all such statements and recitals are and shall be deemed to have been made by the Trust and the Depositor only.

 

 

 

 

 

  

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(e)     The Warrant Agent shall not have any responsibility in respect of and makes no representation as to the validity of the Call Warrants or the execution and delivery thereof (except the due execution thereof by the Warrant Agent); nor shall it be responsible for any breach by the Trust of any covenant or condition contained in the Call Warrants; nor shall it by any act thereunder be deemed to make any representation or warranty as to the Underlying Securities to be purchased thereunder.

 

(f)     The Warrant Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from the Chairman of the Board, the Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, President, a Vice President, its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary of the Depositor, and any Responsible Officer of the Trustee, and to apply to such officers for advice or instructions in connection with its duties, and it shall not be liable for any action taken or suffered to be taken by it in good faith in accordance with instructions of any such officer.

 

(g)     The Warrant Agent and any shareholder, director, officer or employee of the Warrant Agent may buy, sell or deal in any of the Call Warrants or other securities of the Trust or otherwise act as fully and freely as though it were not Warrant Agent hereunder, so long as such persons do so in full compliance with all applicable laws.  Nothing herein shall preclude the Warrant Agent from acting in any other capacity for the Trust, the Depositor or for any other legal entity.

 

(h)     The Warrant Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either by itself or by or through its attorneys or agents, and the Warrant Agent shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder.

 

(i)      The Warrant Agent shall act solely as the agent of the Warrantholders hereunder.  The Warrant Agent shall not be liable except for the failure to perform such duties as are specifically set forth herein, and no implied covenants or obligations shall be read into the Call Warrants against the Warrant Agent, whose duties shall be determined solely by the express provisions thereof.  The Warrant Agent shall not be deemed to be a fiduciary.

 

(j)      The Warrant Agent shall not have any duty to calculate or determine any adjustments with respect either to the Warrant Exercise Purchase Price or to the kind and amount of property receivable by holders of Call Warrants upon the exercise thereof.

 

(k)     The Warrant Agent shall not be responsible for any failure on the part of the Trustee to comply with any of its covenants and obligations contained herein or in the Call Warrants.

 

(l)      The Warrant Agent shall not be under any obligation or duty to institute, appear in or defend any action, suit or legal proceeding in respect hereof or the Call Warrants, unless first indemnified to its satisfaction, but this provision shall not affect the 

 

 

 

 

 

  

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power of the Warrant Agent to take such action as the Warrant Agent may consider proper, whether with or without such indemnity.  The Warrant Agent shall promptly notify the Depositor and the Trustee in writing of any claim made or action, suit or proceeding instituted against it arising out of or in connection with the Call Warrants.

 

(m)    The Trustee will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered all such further acts, instruments and assurances as may be required by the Warrant Agent in order to enable it to carry out or perform its duties hereunder.

 

(n)     The Warrant Agent shall not be liable for any error of judgment made in good faith by any Officer within its corporate trust department or a Person performing similar functions, unless it is proved that the Warrant Agent was negligent in ascertaining the pertinent facts.  The Warrant Agent shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to this Agreement or which it reasonably believes to be authorized or within its rights or powers under this Agreement.

 

(o)     The Warrant Agent shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Warrant Agent, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit.

 

(p)     In no event shall the Warrant Agent be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Warrant Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.

 

(q)     In no event shall the Warrant Agent be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Warrant Agent shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

 

(r)      No provision of this Agreement shall require the Warrant Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

 

 

 

 

 

 

  

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(s)      The Warrant Agent shall not be under any liability for interest on, and shall not be required to invest, any monies at any time received by it pursuant to any of the provisions of the Agreement or of the Call Warrants.  Money and assets held in trust by the Warrant Agent need not be segregated from other funds or assets held by the Warrant Agent except to the extent required by law.

 

    Section 5.3.     Change of Warrant Agent.  The Warrant Agent may resign and be discharged from its duties hereunder upon thirty (30) days’ notice in writing mailed to the Depositor and the Trustee by registered or certified mail, and to the holders of the Call Warrants by first-class mail at the expense of the Depositor; provided that no such resignation or discharge shall become effective until a successor Warrant Agent shall have been appointed hereunder.  The Depositor may remove the Warrant Agent or any successor Warrant Agent upon thirty (30) days’ notice in writing, mailed to the Warrant Agent or successor Warrant Agent, as the case may be, and to the holders of the Call Warrants by first-class mail; provided further that no such removal shall become effective until a successor Warrant Agent shall have been appointed hereunder.  If the Warrant Agent shall resign or be removed or shall otherwise become incapable of acting, the Depositor shall promptly appoint a successor to the Warrant Agent, which may be designated as an interim Warrant Agent.  If an interim Warrant Agent is designated, the Depositor shall then appoint a permanent successor to the Warrant Agent, which may be the interim Warrant Agent.  If the Depositor shall fail to make such appointment of a permanent successor within a period of thirty (30) days after such removal or within sixty (60) days after notification in writing of such resignation or incapacity by the resigning or incapacitated Warrant Agent or by the holder of a Call Warrant, then the Warrant Agent or registered holder of any Warrant may apply to any court of competent jurisdiction for the appointment of such a successor.  Any successor to the Warrant Agent (or any parent of such successor) appointed hereunder must have long-term unsecured debt obligations that are rated in one of the four highest rating categories by the Hired NRSRO.  Any entity which may be merged or consolidated with or which shall otherwise succeed to substantially all of the trust or agency business of the Warrant Agent shall be deemed to be the successor Warrant Agent without any further action.  The holders of more than 50% of the outstanding Call Warrants, by an instrument delivered to the Depositor and the Warrant Agent in writing, shall have the right to object to, and by objecting shall thereby prevent the occurrence of, any proposed action by the Depositor under this Section 5.3.

 

            Section 5.4.      Indemnification of Warrant Agent.  The Depositor shall indemnify and hold harmless the Warrant Agent and its successors, assigns, agents and servants against any and all loss, liability or reasonable expense (including attorney’s fees) incurred by it in connection with the performance of its duties under this Agreement.  The Warrant Agent shall notify the Depositor promptly of any claim for which it may seek indemnity.  Failure by the Warrant Agent to so notify the Depositor shall not relieve the Depositor of its obligations hereunder.  The Depositor need not reimburse any expense or indemnify against any loss, liability or expense incurred by the Warrant Agent through the Warrant Agent’s own willful misconduct, negligence or bad faith.  The indemnities contained in this Section 5.4 shall survive the resignation or termination of the Warrant Agent or the termination of this Agreement.

 

 

 

 

 

  

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     Failure by the Depositor to pay, reimburse or indemnify the Warrant Agent shall not entitle the Warrant Agent to any payment, reimbursement or indemnification from the Trust, nor shall such failure release the Warrant Agent from the duties it is required to perform under this Agreement.  Any unpaid, unreimbursed or unindemnified amounts shall not be borne by the Trust and shall not constitute a claim against the Trust, but shall be borne by the Warrant Agent in its individual capacity, and the Warrant Agent shall have no recourse against the Trust with respect thereto.

 

           Section 5.5.       Appointment of Warrant Agent.  The Trust has duly appointed The Bank of New York Mellon as Warrant Agent for purposes of the Warrant Agent Agreement and to perform such other obligations and duties as are herein set forth.  The Warrant Agent hereby accepts such appointment and agrees that it shall follow the procedures set forth in this Agreement.

 

ARTICLE VI

 

Miscellaneous

 

            Section 6.1.      Remedies.  The remedies at law of the Warrantholder in the event of any default or threatened default by the Warrant Agent in the performance of or compliance with any of the terms of the Call Warrants are not and will not be adequate and, to the fullest extent permitted by law, such terms may be specifically enforced by a decree for the specific performance of any agreement contained herein or by an injunction against a violation of any of the terms thereof or otherwise.

 

           Section 6.2.       Limitation on Liabilities of Holder.  Nothing contained in the Call Warrants or this Agreement shall be construed as imposing any obligation on the holder thereof to purchase any of the Underlying Securities except in accordance with the terms thereof.

 

            Section 6.3.      Notices.  All notices and other communications under this Agreement shall be in writing and shall be delivered, or mailed by registered or certified mail, return receipt requested, by a nationally recognized overnight courier, postage prepaid, addressed (a) if to any holder of any Call Warrant, at the registered address of such holder as set forth in the register kept by the Warrant Agent, or (b) if to the Warrant Agent, to The Bank of New York Mellon, 101 Barclay Street, Floor 7 West, New York, NY 10268, Attention:  Corporate Trust Department or to such other address notice of which the Warrant Agent shall have given to the holder thereof and the Trustee or (c) if to the Trust or the Trustee, to the Corporate Trust Office (as set forth in the Trust Agreement); provided that the exercise of any Call Warrant shall be effective in the manner provided in Article I.

 

Any notice to be given by the Depositor, the Warrant Agent or the Trustee to the Warrantholders shall be sufficiently sent if sent by facsimile and first-class mail to the addresses set forth in the Warrant Register.  Notwithstanding any provisions of the Trust Agreement to the contrary, the Trustee shall deliver all notices or reports required to be delivered by it to the Warrantholders without charge to such Warrantholders.  In the event that the Trustee receives a request from the Underlying Securities Trustee, the Underlying Securities Issuer or, if applicable,

 

 

 

 

 

  

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the Depositary with respect to the Underlying Securities, for the Trustee’s consent to any amendment, modification or waiver of the Underlying Securities, or any document relating thereto, or receives any other solicitation for any action with respect to the Underlying Securities, the Trustee shall within two (2) Business Days of the date of such request mail a notice of such proposed amendment, modification, waiver or solicitation to the Warrantholders.

 

    In addition to the foregoing, the Trustee and the Warrant Agent agree to accept and act upon notice, instructions or directions pursuant to this Agreement sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods.  If the party elects to give the Trustee or the Warrant Agent e-mail or facsimile instructions (or instructions by a similar electronic method) and the Trustee or the Warrant Agent in its discretion elects to act upon such instructions, the Trustee’s or the Warrant Agent’s understanding of such instructions shall be deemed controlling.  Neither the Trustee nor the Warrant Agent shall be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s or the Warrant Agent’s reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction.  The party providing electronic instructions agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee or the Warrant Agent, including without limitation the risk of the Trustee or the Warrant Agent acting on unauthorized instructions, and the risk or interception and misuse by third parties.

 

            Section 6.4.      Amendment.  (a)  This Agreement may be amended from time to time by the Depositor, the Trustee and the Warrant Agent without the consent of the Warrantholder, upon receipt of an opinion of counsel satisfactory to the Warrant Agent that the provisions hereof have been satisfied and that such amendment would not alter the status of the Trust as a grantor trust under the Internal Revenue Code of 1986 (the “Code”), for any of the following purposes:  (i) to cure any ambiguity or to correct or supplement any provision herein which may be defective or inconsistent with any other provision herein or to provide for any other terms or modify any other provisions with respect to matters or questions arising under the Call Warrants which shall not adversely affect in any material respect the interests of the holder thereof or any holder of a Certificate or (ii) to evidence and provide for the acceptance of appointment hereunder of a Warrant Agent other than The Bank of New York Mellon.

 

    (b)         Without limiting the generality of the foregoing, this Agreement may also be modified or amended from time to time by the Depositor, the Trustee and the Warrant Agent with the consent of the holders of 66-2/3% of the outstanding Call Warrants, upon receipt of an opinion of counsel satisfactory to the Warrant Agent that the provisions hereof (including, without limitation, the following proviso) have been satisfied, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Call Warrants or of modifying in any manner the rights of the holders of the Call Warrants; provided, however, that no such amendment shall (i) adversely affect in any material respect the interests of holders of Certificates without the consent of the holders of Certificates evidencing not less than the Required Percentage-Amendment of the aggregate Voting Rights of such affected Certificates (as such terms are defined in the Trust Agreement) and without ten (10) days’ prior written notice to the Hired NRSRO; (ii) alter the dates on which Call Warrants are exercisable or the amounts payable upon exercise of a Call Warrant without the consent of the holders of

 

 

 

 

 

  

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Certificates evidencing 100% of the aggregate Voting Rights of such affected Certificates and the holders of 100% of the affected Call Warrants or (iii) reduce the percentage of aggregate Voting Rights required by (i) or (ii) without the consent of the holders of all such affected Certificates.  Notwithstanding any other provision of this Agreement, this Section 6.4(b) shall not be amended without the consent of the holders of 100% of the affected Call Warrants.

 

            (c)         The Warrant Agent shall notify the Hired NRSRO of any such proposed amendment or modification prior to the execution thereof and promptly after the execution of any such amendment or modification, the Warrant Agent shall furnish a copy of such amendment or modification to each holder of a Call Warrant, to each holder of a Certificate and to the Hired NRSRO.  It shall not be necessary for the consent of holders of Call Warrants or Certificates under this Section 6.4(c) to approve the particular form of any proposed amendment, but it shall be sufficient if such consent shall approve the substance thereof.  The manner of obtaining such consents and of evidencing the authorization of the execution thereof shall be subject to such reasonable regulations as the Warrant Agent may prescribe.

 

            Section 6.5.      Expiration.  The right to exercise the Call Warrants shall expire on the earliest to occur of (a) the cancellation thereof, (b) the termination of the Trust Agreement or (c) the liquidation, disposition or payment in full  (whether by maturity, redemption or otherwise) of all of the Underlying Securities.

 

            Section 6.6.      Descriptive Headings.  The headings in this Agreement are for purposes of reference only and shall not limit or otherwise affect the meaning hereof.

 

            Section 6.7.      Governing Law.  THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.

 

            Section 6.8.      Judicial Proceedings; Waiver of Jury.  Any judicial proceeding brought against the Trust, the Trustee or the Warrant Agent with respect to the Call Warrants or this Agreement may be brought in any court of competent jurisdiction in the County of New York, State of New York or of the United States of America for the Southern District of New York and, by execution and delivery of the Call Warrants, the Trustee on behalf of the Trust and the Warrant Agent (a) accepts, generally and unconditionally, the nonexclusive jurisdiction of such courts and any related appellate court, and irrevocably agrees that the Trust, the Trustee and the Warrant Agent shall be bound by any judgment rendered thereby in connection with the Call Warrants, subject to any rights of appeal, and (b) irrevocably waives any objection that the Trust, the Trustee or the Warrant Agent may now or hereafter have as to the venue of any such suit, action or proceeding brought in such a court or that such court is an inconvenient forum.

 

            Section 6.9.      Nonpetition Covenant; No Recourse.  Each of (i) the Warrantholder, by its acceptance thereof, and (ii) the Warrant Agent, agrees that it shall not (and, in the case of the holder, that it shall not direct the Warrant Agent to), until the date which is one year and one day after the payment in full of the Certificates and all other securities issued by the Trust, the Depositor or entities formed, established or settled by the Depositor, acquiesce, petition or 

 

 

 

 

 

  

-13-

  

 

otherwise invoke or cause the Trust, the Depositor or any such other entity to invoke the process of the United States of America, any State or other political subdivision thereof or any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government for the purpose of commencing or sustaining a case by or against the Trust, the Depositor or any such other entity under a federal or state bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Trust, the Depositor or any such other entity or all or any part of the property or assets of Trust, the Depositor or any such other entity or ordering the winding up or liquidation of the affairs of the Trust, the Depositor or any such other entity.  Notwithstanding anything to the contrary herein, the provisions of this Section 6.9 shall survive the termination of this Agreement.

 

            Section 6.10.    Amendments to the Trust Agreement.  The Trustee hereby agrees not to consent to any amendments to the Trust Agreement which will adversely affect the rights of the Warrantholders in a material manner without the consent of the Warrantholders.

 

            Section 6.11.    Express Beneficiaries.  The Warrantholders shall be express third party beneficiaries to this Agreement entitled to the benefits hereof and to enforce the provisions hereof.

 

            Section 6.12.    Breach of Representation and Warranty.  Upon the discovery by the Depositor or the Trustee of a breach of any of the representations and warranties made in the Trust Agreement that materially and adversely affects the interests of the Warrantholders, the party discovering such breach shall forward or cause the Warrant Agent to forward a written notice of such breach to the Warrantholders.

 

            Section 6.13.    Administration of Trust.  In addition to the provisions set forth in Section 3.1 of the Base Trust Agreement, the Trustee shall administer the Trust for the benefit of the Warrantholders but only to the extent of the interests of the Warrantholders therein and provided further, in the event of a conflict of interest between the Certificateholders and the Warrantholders, the interests of the Certificateholders shall prevail.  The Warrantholders’ right to call the Underlying Securities shall not be considered a conflict of interest with the Certificateholders for purposes of this provision.

 

            Section 6.14.    Reports to Warrantholders.  The Trustee shall furnish to the Warrantholders a copy of the report prepared for the Certificateholders pursuant to Section 4.2 of the Base Trust Agreement, within a reasonable period of time after such report is furnished to the Certificateholders.

 

            Section 6.15.    Reporting Obligations.  During any period in which the Trust is not subject to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Depositor shall promptly furnish to holders of Call Warrants and prospective purchasers of Call Warrants designated by such holders, upon request of such holders or prospective purchasers, the information required to be delivered pursuant to Rule 144A(d)(4) of the Securities Act of 1933, as amended, to permit compliance with Rule 144A in connection with the resale of Call Warrants; provided, however, that the Depositor shall not (a) be required to provide audited 

 

 

 

 

 

  

-14-

  

 

financial statements of the Trust or (b) be required to furnish Rule 144A Information in connection with any request made on or after the date that is two years from the later of (i) the date such Call Warrant (or any predecessor Call Warrant) was acquired from the Depositor or (ii) the date such Call Warrant (or any predecessor Call Warrant) was last acquired from an “affiliate” of the Depositor within the meaning of Rule 144.

 

            Section 6.16.    Voting.  Notwithstanding anything to the contrary in the Base Trust Agreement or the Series Supplement, the Trustee shall at no time vote in favor of or consent to any matter (i) which would alter the timing or amount of any payment on the Underlying Securities (including, without limitation, any demand to accelerate the Underlying Securities) or (ii) which would result in the exchange or substitution of any Underlying Security whether or not pursuant to a plan for the refunding or refinancing or such Underlying Security, except in each case with the unanimous consent of the Warrantholders, and subject to the requirement that such vote would not materially increase the likelihood that the Trust will fail to qualify as a grantor trust for federal income tax purpose, and, in any event, that the Trust will not fail to qualify as either a grantor trust or partnership (other than a publicly traded partnership treated as a corporation) under the Code, such determination to be based solely on an Opinion of Counsel; provided, however, that the foregoing shall not apply to any tender of Underlying Securities pursuant to a tender offer at the direction of a Warrantholder in accordance with the terms of the Warrants.

 

 

[Signature Page Follows]

 

 

 

 

 

 

 

  

-15-

  

    IN WITNESS WHEREOF, the parties hereto have caused their names to be signed hereto by their respective duly authorized officers as of the date first above written.

 

 

	
FIXED INCOME CLIENT SOLUTIONS  LLC,

  as Depositor

	  
	  
	  
	
By:                                                                                

	
     Name:  

	
         Title:  

	  
	  
	  
	
THE BANK OF NEW YORK MELLON

    not in its individual capacity but solely as

    Trustee and Authenticating Agent

	  
	  
	  
	
By:                                                                              

	
 Name:  

	
 Title:  

	  
	  
	  
	
THE BANK OF NEW YORK MELLON,

   as Warrant Agent

	  
	  
	  
	
By:                                                                              

	
 Name:  

	
 Title:  

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Warrant Agent Agreement

(Fixed Income Trust for Prudential Financial, Inc. Notes, Series 2012-1)]ex101.htm

PURCHASE OF ACQUISITION AGREEMENT

THIS AGREEMENT dated and made effective as of the 30th day of March, 2012.

BETWEEN:

GLOBAL ENVIRONMENTAL INVESTMENTS LIMITED, of Belize City, Belize

(“GEIL”)

OF THE FIRST PART

AND:

GREENWOOD GOLD RESOURCES INC., a Nevada Corporation,

(“GGRI”)

OF THE SECOND PART

WHEREAS GEIL is a party to that certain acquisition agreement dated March 16, 2012 (the “Acquisition Agreement”) with Fundacion Nelson Velasco Aguirre (“NVA”);

AND WHEREAS NVA is the legal owner of real estate property located in Ecuador, pursuant to which NVA has the right, and beneficial interest to the real property located in Ecuador, known as the Hacienda Juval, consisting of approximately 105,000 hectares (hereinafter, the “Property”);

AND WHEREAS in accordance with the terms and provisions of the Acquisition Agreement, NVA has transferred control of the Property to GEIL pursuant to the laws of Ecuador, namely the Acquisition Agreement dated March 16, 2012;

AND WHEREAS, NVA wishes to maintain legal ownership of the Property on the terms and conditions hereinafter set forth, but shall agree to permit control over the Property to pass to GEIL through the Voting Trustee, pursuant to that certain voting trust agreement dated March 16, 2012 between NVA, GEIL and Amanda Miller as voting trustee (the “Voting Trust Agreement”).;

AND WHEREAS that certain acquisition agreement dated February 6, 2012 (the “ORE Acquisition Agreement”), previously entered into by and between Oceanview Real Estate Company, a private company organized under the law of Canada (“ORE”) and GGRI has been rescinded;

  

Page 1 of 15

  

AND WHEREAS GGRI wishes to purchase and GEIL wishes to sell all of its rights to the Property held by GEIL pursuant to the Acquisition Agreement to GGRI on the terms and conditions hereinafter set forth;

NOW THEREFORE, in consideration of the covenants, agreements, representations, warranties and payments hereinafter set forth, the parties do hereby agree, as follows:

	
1.

	
       SALE AND TRANSFER OF RIGHTS ASSOCIATED THE PROPERTY

	
1.1

	
SALE OF PROPERTY. Subject to the terms and conditions of this Agreement and in reliance upon the representations, warranties, covenants and agreements contained herein, at the closing of the transactions contemplated hereby, GEIL hereby sells, conveys, assigns and transfers 100% of GEIL’s interest in and to the Voting Trust Agreement and the Acquisition Agreement and any and all claims, rights in respect of the Property, to GGRI.  This shall include:

	
  

	
(a)

	
100% of GEIL’s rights, title and interests in and to the timber, minerals, substances and the rights to receive from the Property all benefits thereto, and associated with those rights associated for the use intended by the Purchaser, namely for the development of the Property as a carbon development project for the purpose of generating carbon credits that may be traded on a public market.  This includes, for greater certainty and any and all other minerals in and under and that may be produced from the Property including, without limitation, interests in oil, gas and/or mineral leases covering any part of the lands, overriding royalty interests, fee mineral interests, carbon credits, and other interests in oil, gas and other minerals in any part of the lands;

	
  

	
(b)

	
100% of the right, title and interests of GEIL in all presently existing and valid oil, gas and/or mineral unitization, pooling and/or communization agreements, declarations, and/or orders and the properties covered or included in the units (including, without limitation, units formed under orders, rules, regulations or other official acts of any federal, state or other authority having jurisdiction, voluntary unitization agreements, designations, and/or declarations, and any working interest units created under operating agreements or otherwise), which relate to the Property;

	
  

	
(c)

	
100% of the right, title and interests of GEIL in all presently existing and valid agreements, including sales and sales related contracts, operating agreements and other agreements and contracts which relate to NVA, the Property or which relate to the exploration, development, operation or maintenance of the Property or the treatment, storage, transaction or marketing of production from or allocated to the Property;  and

	
  

	
(d)

	
100% of the right, title and interests of GEIL in and to all materials, supplies, machinery, equipment, improvements, and other personal property and fixtures relating to the Property, and all wells, wellhead equipment, pumping units, flow lines, tanks, buildings, injection facilities, salt water disposal facilities, compression facilities, gathering systems and other equipment, all easements, rights-of-way, surface leases and other surface rights, all permits and licenses and all other appurtenances, used or held for use in connection with or related to the exploration, development, operation or maintenance of any of the Property.

  

Page 2 of 15

  

	
1.2  

	
CONSIDERATION.  The consideration for the above assignment sale and transfer from GEIL to GGRI shall be shares as follows:

(a)         The share consideration to be issued to GEIL and/or its designee shall be 75,000,000 shares to be issued of the restricted common stock of GGRI out of 100,424,500 shares issued. This issuance represents approximately 75% control to GEIL.

 

2.           REPRESENTATIONS AND WARRANTIES

2.1         REPRESENTATIONS AND WARRANTIES OF GEIL

GEIL represents and warrants as follows:

	
  

	
a)

	
CORPORATE ORGANIZATION AND GOOD STANDING.  GEIL is duly organized, validly existing, and in good standing under the laws of the country of Belize and is qualified to do business as a foreign corporation in each jurisdiction, if any, in which its property or business requires such qualification.

	
  

	
b)

	
CORPORATE AUTHORITY.  GEIL has all requisite corporate power and authority to own, operate and lease its properties, to carry on its business as it is now being conducted and to execute, deliver, perform and conclude the transactions contemplated by this Agreement and all other agreements and instruments related to this Agreement.

	
  

	
c)

	
AUTHORIZATION.  Execution of this Agreement has been duly authorized and approved by GEIL.

	
  

	
d)

	
OBLIGATIONS RELATING TO THE PROPERTY.  Neither GEIL, nor NVA, has any contract or other obligation other than the Acquisition Agreement and the Voting Trust Agreement each dated March 16, 2012, which agreements shall be transferred to GGRI, in regard to any rights, interests, licensing or any other agreements relating to the Property.  There are no outstanding options, rights, or other commitments or agreements of any character relating to the Property.

 

	
  

	
e)

	
VALUATION REPORT.  GEIL shall provide to GGRI the valuation report dated February 2, 2012 from NVA, which contains a certificate issued by the Minister of Agriculture of Ecuador attesting to the total surface of the Property (the “Valuation Report”).

 

	
  

	
f)

	
TITLE. GEIL has, due to the rights granted by assignment, marketable title to the rights associated with the Property. For purposes of this Agreement, “marketable title” means such title as will enable GGRI, as GEIL’s successor in 100% interest, to

  

Page 3 of 15

  

	
  

	
receive all benefits associated with the carbon development project for the purpose of generating carbon credits that may be traded on a public market associated with the Property, without reduction, suspension or termination throughout the productive life, except for any reduction, suspension or termination: (a) caused by GGRI; (b) caused by others without authority from GGRI or with or without from orders of the appropriate regulatory agency having jurisdiction over the Property that concern matters affecting the Property; and (c) caused by any contract containing a sliding-scale royalty clause or other similar clause with respect to a production burden associated with the Property; Marketable Title shall also mean title as will obligate GGRI, as GEIL’s successor in 100% interest of the title, to bear no greater working interest than the working interest for each of the assets on the Property or as being associated with the Property without increase, except for any increase: (a) caused by GGRI; (b) that also results in the net revenue interest associated with the well being proportionately increased; (c) caused by contribution requirements provided for in any valid and existing operating agreement; or (d) caused by orders of the appropriate regulatory agency having jurisdiction over the Property and that concern resource development affecting the Property.

GEIL has, through NVA and the Voting Trustee good and defensible title subject to permitted encumbrances to the Property. Permitted Encumbrances shall mean: (a) liens for taxes not yet delinquent; (b) lessor’s royalties, overriding royalties, reversionary interests and similar burdens that do not operate to reduce the net revenue interest of GEIL in the Property; (c) the consents and rights described herein  insofar as such contracts and agreements do not operate to increase the working interest of GEIL or decrease the net revenue interest of GEIL.

	
  

	
g)

	
LITIGATION.  To the knowledge of GEIL, there are no pending, threatened, or existing litigation, bankruptcy, criminal, civil, or regulatory proceeding or investigation, threatened or contemplated against GEIL which, if decided adversely to GEIL, would impose any rights or interest or judgment against the Property.

	
  

	
h)

	
COMPLIANCE WITH APPLICABLE LAW AND REGULATORY MATTERS. GEIL has complied with all applicable laws and regulations, and are not in violation of, and have not received any written notices of violation with respect to, any laws and regulations in connection with the conduct of their respective businesses or the ownership or operation of their respective businesses, assets and properties, in regard to the Property.

 

	
  

	
i)

	
MATERIAL CONTRACTS.  There are no material contracts of GEIL currently in existence in relation to the Property except as disclosed herein.

 

	
  

	
J)

	
INTERESTS OF OFFICERS AND DIRECTORS.  Except as disclosed herein, none of the officers or directors of GEIL has any interest in the material contracts or in respect of the Property.

 

	
  

	
k)

	
BROKER’S FEES.  GEIL has not employed any broker or finder or incurred any liability for any broker’s fees, commissions or finder’s fees in connection with the transactions contemplated by this Agreement.

 

  

Page 4 of 15

  

 

	
  

	
l)

	
CERTAIN BUSINESS PRACTICES.  No director, officer, agent or employee of GEIL or NVA has (i) used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity on behalf of, or purportedly on behalf of, or for the business of GEIL or NVA, or (ii) made any unlawful payments to officials or employees of governmental entities or to directors, officers or employees of foreign or domestic business enterprises.

 

2.2         REPRESENTATIONS AND WARRANTIES OF GGRI. GGRI represents and warrants:

	
  

	
a)

	
CORPORATE ORGANIZATION AND GOOD STANDING.  GGRI is a corporation duly organized, validly existing, and in good standing under the laws of the State of Nevada, and is qualified to do business as a foreign corporation in each jurisdiction, if any, in which its property or business requires such qualification.

 

	
  

	
b)

	
CORPORATE AUTHORITY.  GGRI has all requisite corporate power and authority to execute, deliver, perform and conclude the transactions contemplated by this Agreement and all other agreements and instruments related to this Agreement.

 

	
  

	
c)

	
NO VIOLATION.  Consummation of the acquisition contemplated herein will not constitute or result in a breach or default under any provision of any charter, bylaw, indenture, mortgage, lease, or agreement, or any order, judgment, decree, law, or regulation by which GGRI is bound.

 

	
  

	
d)

	
REPORTING STATUS. GGRI is a fully reporting public company under Section 15(d) of the Securities and Exchange Act of 1934, and is current on its filing obligations under Section 15.  GGRI has filed all required periodic reports with the Securities & Exchange Commission (the "Commission") on Forms 10-Q and 10-K through the fiscal year ended December 31, 2010 and for the nine months ended September 30, 2011, and all required Form 8-K reports, all such reports are true and correct in all material respects and contain no misrepresentation of a material fact or omission of a material fact.  The common shares of GGRI are quoted on the OTC Markets OTCbb and OTCQB under the symbol "GGRID".  GGRI has not received and there are no outstanding Commission Staff comment letters, stop orders or other regulatory actions, and no letters, comments, investigations or other actions pending or threatened by the Commission or by the Financial Industry Regulatory Authority (FINRA) against or relating to GGRI and there are no outstanding fees, fines or other amounts due to FINRA, the SEC, PCAOB or any other regulatory agency..

 

    e)             CAPITALIZATION.

 

	
  

	
(i)

	
On the date of this Agreement, 400,000,000 shares of $0.0001 par value common stock are authorized and  424,500 shares of common stock of GGRI are issued and outstanding, all of the shares of common stock issued are duly authorized, validly issued, fully paid and non-

 

  

Page 5 of 15

  

	
  

	
assessable and none were issued in violation of any preemptive rights.  On the date of this Agreement: (i) no shares of GGRI are reserved for issuance upon the exercise of outstanding options, warrants or other rights to purchase shares; and (ii) no shares of GGRI are held in the treasury of GGRI. However, after Closing and not later than 90 days from February 15, 2012, GGRI shall cause the debt in the approximate amount of $60,000 due and owing to that certain creditor (the “Creditor”), as reflected on the financial statements of GGRI as of September 30, 2011 (the “$60,000 Debt”) to be settled by issuance to the Creditor and/or his designee an aggregate of 25,000,000 shares of common stock (see paragraph 3.2 (c) ).  Except as set forth above, as of the date hereof, no shares or other voting securities of GGRI are issued, reserved for issuance or outstanding.  There are no bonds, debentures, notes or other indebtedness or securities of GGRI that have the right to vote (or that are convertible into, or exchangeable for, securities having the right to vote) on any matters on which stockholders of GGRI may vote.  All shares of GGRI subject to issuance as described above shall, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, be duly authorized, validly issued, fully paid, non-assessable and free of preemptive rights.

 

	
  

	
(ii)

	
GGRI has no contract or other obligation to repurchase, redeem or otherwise acquire any shares of GGRI stock, or make any investment (in the form of a loan, capital contribution or otherwise) in any other person.  Apart from the Mainland Consultant Agreement (discussed at 3.2(e) herein),  there are no outstanding subscriptions, options, warrants, puts, calls, rights, exchangeable or convertible securities or other commitments or agreements of any character relating to the issued or unissued shares or other securities of GGRI.  None of the outstanding equity securities or other securities of GGRI was issued in violation of the Securities Act of 1933 or any other legal requirement.

 

	
f)              

	
AUTHORITY; NO VIOLATION.

 

	
  

	
(i)

	
GGRI has full corporate power and authority to execute and deliver this Agreement and to comply with the terms hereof and consummate the transactions contemplated hereby.  This Agreement has been duly and validly executed and delivered by GGRI.  Assuming due authorization, execution and delivery by the other Parties, this Agreement constitutes the valid and binding obligation of GGRI, enforceable against GGRI in accordance with its terms, except as such enforcement may be limited by (i) the effect of bankruptcy, insolvency, reorganization, receivership, conservatorship, arrangement, moratorium or other similar laws affecting or relating to the rights of creditors generally, or (ii) the rules governing the availability of specific performance, injunctive relief or other equitable remedies and general principles of equity, regardless of whether considered in a proceeding in equity or at law, or (iii) the specific terms and conditions of this Agreement.

 

	
  

	
(ii)

	
Neither the execution and delivery of this Agreement by GGRI nor the consummation by GGRI of the transactions contemplated hereby, nor compliance by GGRI with any of the terms or provisions hereof, will (A) violate any provision of the Certificate of Incorporation or 

 

  

Page 6 of 15

  

	
  

	
Constitution or the certificates of registration or constitution, or other charter or organizational documents, of GGRI; or (B) violate any statute, code, ordinance, rule, regulation, judgment, order, writ, decree or injunction applicable to GGRI or any of its properties or assets, the violation of which would have a material adverse effect; or (C) violate, conflict with, result in a breach of any provision of or the loss of any material benefit under, constitute a default (or an event which, with notice or lapse of time, or both, would constitute a default) under, result in the termination of any or all rights or benefits or a right of termination or cancellation under, accelerate the performance required by or rights or obligations under, increase any rate of interest payable or result in the creation of any lien upon any of the respective properties or assets of GGRI under, any authorization or of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement, contract, or other instrument or obligation to which is a party, or by which its properties, assets or business activities may be bound or affected.

 

	
g)              

	
FINANCIAL STATEMENTS.

 

	
(i)  

	
GGRI acknowledges that all financial statements filed with the SEC are available to GEIL to view prior to the Closing Date, and GGRI confirms such financial statements are true and complete copies of the unaudited and audited financial statements of GGRI as filed with the SEC as at the Closing Date. (the “GGRI Financial Statements”).

 

	
  

	
(ii)  

	
GGRI Financial Statements were prepared in accordance with GAAP or the equivalent applied on a basis consistent throughout the periods indicated (except as otherwise stated in such financial statements, including the related notes, and except that, in the case of unaudited statements for the subsequent quarterly periods referenced above, such unaudited statements fairly present in all material respects the consolidated financial condition and the results of operations of GGRI as at the respective dates thereof and for the periods indicated therein (subject, in the case of unaudited statements, to year-end audit adjustments).

 

	
h)              

	
ABSENCE OF CERTAIN CHANGES OR EVENTS.  Since the end of its most recent fiscal year and to the date of this Agreement, (i) GGRI has, in all material respects, conducted its business in the ordinary course consistent with past practice; (ii) there has not occurred any change, event or condition that is or would reasonably be expected to result in a material adverse effect; and (iii)  GGRI has not taken and will not take any of the actions that GGRI has agreed not to take from the date hereof through the Closing.

 

	
i)              

	
UNDISCLOSED LIABILITIES.  GGRI has no material obligations or liabilities of any nature (whether accrued, matured or unmatured, fixed or contingent or otherwise) other than (i) those set forth or adequately provided for in the balance sheet (and the related notes thereto) of 

 

  

Page 7 of 15

  

	
     

	
 GGRI as of the end of the most recent fiscal year  included in the GGRI Financial Statements, (ii) those incurred in the ordinary course of business consistent with past practice since the end of the most recent fiscal year  and (iii) those incurred in connection with the execution of this Agreement.

 

	
j)              

	
LEGAL PROCEEDINGS.  GGRI is not a party to any, and there is no pending or, to the knowledge of GGRI, threatened, legal, administrative, arbitral or other proceeding, claim, action or governmental or regulatory investigation of any nature against GGRI, or any of its officers or directors which, if decided adversely to GGR, would, individually or in the aggregate, be material to GGRI.  There is no injunction, order, judgment or decree imposed upon GGRI, or any of its officers or directors, or the assets of GGRI.

 

	
k)              

	
TAXES AND TAX RETURNS.  GGRI shall file or caused to be filed all  federal, state, foreign and local tax returns required to be filed with any tax authority; (ii) all such tax returns shall be true, accurate, and complete in all material respects; (iii) GGRI shall pay or caused to be paid all taxes that are due and payable by any of such companies, other than taxes which are being contested in good faith and are adequately reserved against or provided for (in accordance with  GAAP) in the GGRI Financial Statements, and (iv) GGRI shall  not have any material liability for taxes for any current or prior tax periods in excess of the amount reserved or provided for in the GGRI Financial Statements (but excluding, for this Clause (iv) only, any liability reflected thereon for deferred taxes to reflect timing differences between tax and financial accounting methods).

 

No national, state, local or foreign audits, examinations, investigations, or other formal proceedings are pending or, to GGRI’s knowledge, threatened with regard to any taxes or tax returns of GGRI.  No issue has arisen in any examination of the GGRI by any tax authority that if raised with respect to any other period not so examined would result in a material deficiency for any other period not so examined, if upheld.  Any adjustment of income taxes of GGRI made in any examination that is required to be reported to the appropriate national, state, local or foreign tax authorities has been so reported.

 

There are no disputes pending with respect to, or claims or assessments asserted in writing for, any material amount of taxes upon GGRI, nor has GGRI given or been requested in writing to give any currently effective waiver extending the statutory period of limitation applicable to any tax return for any period.

 

      l)     COMPLIANCE WITH APPLICABLE LAW AND REGULATORY MATTERS.

 

	
(i)  

	
GGRI has complied with all applicable laws and regulations, and are not in violation of, and have not received any written notices of violation with respect to, any laws and regulations in connection with the conduct of their respective businesses or the ownership or operation of their respective businesses, assets and properties, except for such noncompliance and violations as would not, individually or in the aggregate, be material.

 

  

Page 8 of 15

  

	
  

	
(ii)

	
GGRI has all licenses, permits, certificates, franchises and other authorizations (collectively, the “Authorizations”) necessary for the ownership or use of its assets and properties and the conduct of its business, as currently conducted, and have complied with, and are not in violation of, any Authorization, except where such noncompliance or violation would not, individually or in the aggregate, be material.  Except as would not be material to GGRI, all such Authorizations are in full force and effect and there are no proceedings pending, or, to the knowledge of GGRI, threatened, that seek the revocation, cancellation, suspension or adverse modification thereof.

	
m)              

	
GOVERNMENT ORDERS. There are no governmental orders applicable to GGRI which have had a Material Adverse Effect on GGRI.

 

	
n)              

	
MATERIAL CONTRACTS.  There are no material contracts of GGRI currently in existence, save for those disclosed in the financial statements of GGRI.

 

	
o)              

	
ASSETS.  GGRI owns, leases or has the right to use all the properties and assets necessary or currently used for the conduct of its businesses free and clear of all liens of any kind or character.  All items of equipment and other tangible assets owned by or leased to GGRI and which are material to the operations and business of GGRI are in good condition and repair (ordinary wear and tear excepted).  In the case of leased equipment and other tangible assets, GGRI holds valid leasehold interests in such leased equipment and other tangible assets, free and clear of all liens of any kind or character.

 

	
p)              

	
ENVIRONMENTAL LIABILITY.  GGRI is in compliance with all applicable environmental laws.  To the knowledge of GGRI, there are no liabilities of GGRI of any kind, whether accrued, contingent, absolute, determined, determinable or otherwise arising under or relating to any environmental law and, to the knowledge of GGRI, there are no facts, conditions, situations or set of circumstances that could reasonably be expected to result in or be the basis for any such liability.

 

     q)               INSURANCE.  GGRI has no insurance coverage with respect to its business.

 

	
r)              

	
BROKER’S FEES.  GGRI has not employed any broker or finder or incurred any liability for any broker’s fees, commissions or finder’s fees in connection with the transactions contemplated by this Agreement.

 

	
s)              

	
CERTAIN BUSINESS PRACTICES.  No director, officer, agent or employee of GGRI has: (i) used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity on behalf of, or purportedly on behalf of, or for the business of GGRI, or (ii) made any unlawful payments to officials or employees of governmental entities or to directors, officers or employees of foreign or domestic business enterprises.

 

  

Page 9 of 15

  

	
3.

	
     CONDITIONS PRECEDENT AND SUBSEQUENT

 

	
3.1

	
Conditions to Each Party’s Obligations. The respective obligations of each Party hereunder shall be subject to the satisfaction prior to or at the Closing of the following conditions:

	
  

	
a)

	
No Restraints. No statute, rule, regulation, order, decree, or injunction shall have been enacted, entered, promulgated, or enforced by any court or governmental entity of competent jurisdiction which enjoins or prohibits the consummation of this Agreement and shall be in effect.

	
  

	
b)

	
Legal Action. There shall not be pending or threatened in writing any action, proceeding, or other application before any court or governmental entity challenging or seeking to restrain or prohibit the consummation of the transactions contemplated by this Agreement, or seeking to obtain any material damages.

	
3.2

	
Conditions to GEIL’s Obligations. The obligations of GEIL shall be subject to satisfaction of the following conditions unless waived by GEIL:

	
  

	
a)

	
Representatives and Warranties of GGRI. The representations and warranties of GGRI set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing as though made on and as of the Closing, except: (i) as otherwise contemplated by this Agreement; or (ii) in respects that do not have a Material Adverse Effect on the Parties or on the benefits of the transactions provided for in this Agreement. “Material Adverse Effect” for purposes of this Agreement shall mean any change or effect that, individually or when taken together with all other such changes or effects which have occurred prior to the date of determination of the occurrence of the Material Adverse Effect, is or is reasonably likely to be materially adverse to the business, assets, financial condition, or results of operation of the entity.

	
  

	
b)

	
Performance of Obligations of GGRI. GGRI shall have performed all agreements and covenants required to be performed by it under this Agreement prior to the Closing, except for breaches that do not have a Material Adverse Effect on the Parties or on the benefits of the transactions provided for in this Agreement.

	
  

	
c)

	
Debt Settlement.  (i) After Closing, GGRI shall cause the debt in the approximate amount of $60,000 due and owing to that certain creditor (the “Creditor”), as reflected on the financial statements of GGRI as of September 30, 2011 (the “$60,000 Debt”) to be settled by issuance to the Creditor and/or his designee an aggregate of 25,000,000 shares of common stock. (ii) Pursuant to the ORE Acquisition Agreement, GGRI agreed within ninety days after closing of that transaction, to cause the debt in the approximate amount of $152,000 due and owing to Branislav Jovanovic (“Jovanovic”), as reflected on the financial statements of GGRI as of September 30, 2011 (the “Jovanovic Debt”) to be settled by payment to Jovanovic.  Despite the rescission of the ORE Acquisition Agreement, the obligations of GGRI in respect of the payments of the Jovanovic Debt set out in the ORE Acquisition Agreement shall be satisfied by virtue of this agreement.

  

Page 10 of 15

  

	
  

	
d)

	
Anti-Dilution. Prior to Closing and the twelve month period following the date of Closing (the “Anti-Dilution Period”), GGRI has agreed not to increase the number of its outstanding shares of common stock, or change in any way the rights and privileges of such shares, by means of the payment of a stock dividend or the making of any other distribution on such shares payable in its common stock unless it shall receive the prior written approval of the Creditor (see above paragraph). In the event that the Creditor provides its written consent to GGRI to increase its outstanding shares of common stock during the Anti-Dilution Period pursuant to subsequent issuances of its shares of common stock, GGRI shall also issue to the Creditor and/or his designee that number of shares of common stock so that the Creditor maintains its percentage equity interest held during the Anti-Dilution Period.

	
  

	
e)

	
Mainland Consultant Agreement.  Upon Closing, GGRI shall cause a three year consultant agreement (the “Mainland Consultant Agreement”) between GGRI and Mainland Investment Ltd. (“Mainland”) to be executed and effected. The Mainland Consultant Agreement shall provide that Mainland will provide to GGRI financial, advisory, marketing and investor relation services and GGRI shall pay to Mainland an annual compensation of $1,000,000 and grant 1,000,000 stock options exercisable at $1.00 per share.

	
3.3

	
Conditions to GGRI’s Obligations. The obligations of GGRI shall be subject to the satisfaction to the following conditions unless waived by GGRI:

	
a)  

	
Representatives and Warranties of GEIL. The representations and warranties of GEIL set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing as though made on and as of the Closing, except: (i) as otherwise contemplated by this Agreement, or (ii) in respects that do not have a Material Adverse Effect on the Parties or on the benefits of the transactions provided for in this Agreement.

	
                          

	
b)

	
Performance of GEIL. GEIL shall have performed all agreements and covenants required to be performed by them under this Agreement prior to Closing, except for breaches that do not have a Material Adverse Effect on the Parties or on the benefits of the transactions provided for in this Agreement.

4.           CLOSING AND DELIVERY OF DOCUMENTS

	
4.1

	
Time and Place. The Closing of the transaction contemplated by this Agreement shall take place at the offices of GGRI, unless otherwise agreed by the Parties, immediately upon the full execution of this Agreement, and the satisfaction of all conditions, specifically the delivery of all required documents, or at such other time and place as the Parties mutually agree.  All proceedings to be taken and all documents to be executed at the Closing shall be deemed to have been taken, delivered and executed simultaneously, and no proceeding shall be deemed taken nor documents deemed executed or delivered until all have been taken, delivered and executed. The date of Closing may be accelerated or extended by agreement of the parties.

  

Page 11 of 15

  

 

Any copy, facsimile telecommunication or other reliable reproduction of the writing or transmission required by this Agreement or any signature required thereon may be used in lieu of an original writing or transmission or signature for any and all purposes for which the original could be used, provided that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission or original signature.

4.2         Deliveries by GEIL. At Closing, GEIL shall make the following deliveries to GGRI:

	
a)  

	
Certified resolutions of the Board of Directors of GEIL authorizing

i.         the execution and performance of this Agreement;

	
  

	
ii.

	
the delivery of  the Voting Trust Agreement and confirmation that the Board of Directors of GGRI shall be entitled following the Closing to direct the Voting Trustee in respect of the matters referred to in the said agreement.  The Voting Trust Agreement is attached to this Agreement as Schedule A;

	
  

	
b)

	
Such documents as may be required to transfer the Property to GGRI and any related contracts or agreements in regard to the Property.

4.3         Deliveries by GGRI. At Closing, GGRI shall make the following deliveries to GEIL:

	
a)  

	
Stock certificates representing the GGRI common shares issued in the name of GEIL and/or its designee, to be delivered, within one week of this agreement, to GEIL; and

	
b)  

	
Certified resolutions of the Board of Directors of GGRI authorizing the execution and performance of this Agreement and issuance of the 75,000,000 shares of common stock.

5.           TERMINATION

Upon Closing, GGRI shall cause the transfer agent to issue stock certificate(s) to GEIL evidencing the 75,000,000 shares of newly issued restricted common stock.

6.            INDEMNIFICATION AND ARBITRATION

	
6.1

	
Indemnification. GEIL, on the one hand, and GGRI, on the other hand, (each party, “Indemnifying Party”) shall agree to indemnify, and hold harmless the other party (“Indemnified Party”) from any and all claims, demands, liabilities, damages, losses, costs and expenses that the other party shall incur or suffer, including attorneys fees and costs, that arise, result from or relate to any breach of, or failure by Indemnifying Party to perform any of their respective representations, warranties, covenants, or agreements in this Agreement or in any exhibit, addendum, or any other instrument furnished by the Indemnifying Party under this Agreement.

  

Page 12 of 15

  

 

	
6.2

	
Arbitration and Governing Law. The parties hereby agree that any and all claims (except only for requests for injunctive or other equitable relief) whether existing now, in the past or in the future as to which the parties or any affiliates may be adverse parties, and whether arising out of this Agreement or from any other cause, will be resolved by arbitration before the American Arbitration Association within the State of Nevada.

	
  

	
a)

	
The parties hereby irrevocably consent to the jurisdiction of the American Arbitration Association and the situs of the arbitration (and any requests for injunctive or other equitable relief) within the State of Nevada.  Any award in arbitration may be entered in any domestic or foreign court having jurisdiction over the enforcement of such awards.

	
  

	
b)

	
The law applicable to the arbitration and this Agreement shall be that of the State of Nevada, determined without regard to its provisions which would otherwise apply to a question of conflict of laws.

	
  

	
c)

	
The arbitrator may, in its discretion, allow the parties to make reasonable disclosure and discovery in regard to any matters which are the subject of the arbitration and to compel compliance with such disclosure and discovery order.  The arbitrator may order the parties to comply with all or any of the disclosure and discovery provisions of the Federal Rules of Civil Procedure, as they then exist, as may be modified by the arbitrator consistent with the desire to simplify the conduct and minimize the expense of the arbitration.

	
  

	
d)

	
Regardless of any practices of arbitration to the contrary, the arbitrator will apply the rules of contract and other law of the jurisdiction whose law applies to the arbitration so that the decision of the arbitrator will be, as much as possible, the same as if the dispute had been determined by a court of competent jurisdiction.

	
  

	
e)

	
Any award or decision by the American Arbitration Association shall be final, binding and non-appealable except as to errors of law or the failure of the arbitrator to adhere to the arbitration provisions contained in this agreement.  Each party to the arbitration shall pay its own costs and counsel fees except as specifically provided otherwise in this agreement.

	
  

	
f)

	
In any adverse action, the parties shall restrict themselves to claims for compensatory damages and/or securities issued or to be issued and no claims shall be made by any party or affiliate for lost profits, punitive or multiple damages.

	
  

	
g)

	
The parties covenant that under no conditions will any party or any affiliate file any action against the other (except only requests for injunctive or other equitable relief) in any forum other than before the American Arbitration Association, and the parties agree that any such action, if filed, shall be dismissed upon application and shall be referred for arbitration hereunder with costs and attorney's fees to the prevailing party.

  

Page 13 of 15

  

	
  

	
h)

	
It is the intention of the parties and their affiliates that all disputes of any nature between them, whenever arising, whether in regard to this agreement or any other matter, from whatever cause, based on whatever law, rule or regulation, whether statutory or common law, and however characterized, be decided by arbitration as provided herein and that no party or affiliate be required to litigate in any other forum any disputes or other matters except for requests for injunctive or equitable relief. This agreement shall be interpreted in conformance with this stated intent of the parties and their affiliates.

The provisions for arbitration contained herein shall survive the termination of this agreement for any reason.

7.          GENERAL PROVISIONS

	
7.1

	
FURTHER ASSURANCES.  From time to time, each party will execute such additional instruments and take such actions as may be reasonably required to carry out the intent and purposes of this Agreement.

	
7.2

	
WAIVER.  Any failure on the part of either party hereto to comply with any of its obligations, agreements, or conditions hereunder may be waived in writing by the party to whom such compliance is owed.

	
7.3

	
BROKERS.  Each party agrees to indemnify and hold harmless the other party against any fee, loss, or expense arising out of claims by brokers or finders employed or alleged to have been employed by the indemnifying party.

	
7.4

	
NOTICES.  All notices and other communications hereunder shall be in writing and shall be given by personal delivery, overnight delivery, mailed by registered or certified mail, postage prepaid, with return receipt requested, as follows:

If to GEIL to:

Cor 12, Bayman Avenue and Calle Al Mar

Belize City, Belize

If to GGRI to:

Mr. Charles Miller, President

4960 S. Gilbert Road Suite 1-111

Chandler AZ,

85249

 

  

Page 14 of 15

  

With a copy to:

Norman D. Anderson Esq.,

c/o Shea Nerland Calnan LLP

2800, 715- 5th Avenue SW

Calgary, Alberta, Canada

T2P 2X6

The persons and addresses set forth above may be changed from time to time by a notice sent as aforesaid. If notice is given by personal delivery or overnight delivery in accordance with the provisions of this Section, such notice shall be conclusively deemed given at the time of such delivery provided a receipt is obtained from the recipient. If notice is given by mail, such notice shall be deemed given upon receipt and delivery or refusal.

	
7.5

	
ASSIGNMENT.  This Agreement shall inure to the benefit of, and be binding upon, the parties hereto and their successors and assigns; provided, however, that any assignment by either party of its rights under this Agreement without the written consent of the other party shall be void.

	
7.6

	
COUNTERPARTS.  This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  Signatures sent by facsimile transmission shall be deemed to be evidence of the original execution thereof.

	
7.7

	
REVIEW OF AGREEMENT.  Each party acknowledges that it has had time to review this agreement and, as desired, consult with counsel.  In the interpretation of this Agreement, no adverse presumption shall be made against any party on the basis that it has prepared, or participated in the preparation of, this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement on the date first written above.

GREENWOOD GOLD RESOURCES INC. 

BY:              

Name:              Charles Miller

TITLE:              President/CEO

GLOBAL ENVIRONMENTAL INVESTMENTS LIMITED

BY:              

Name:              Mike McCarthy

TITLE:              President

  

Page 15 of 15

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