Document:

Unassociated Document

    STOCK
      PURCHASE AND TERMINATION AGREEMENT

     

    This
      Stock Purchase and Termination Agreement (the “Agreement”),
      dated
      as of October 5, 2007, is entered into by and among H2Diesel Holdings, Inc.,
      a
      Florida corporation (“Holdings”),
      H2Diesel, Inc., a Delaware corporation and wholly-owned subsidiary of Holdings
      (“H2Diesel”),
      and
      Xethanol Corporation, a Delaware corporation (“Xethanol”).

     

    RECITALS

     

    WHEREAS,
      Xethanol beneficially owns 5,850,000 shares of common stock, par value $0.001
      per share, of Holdings; and

     

    WHEREAS,
      Xethanol desires to sell 5,460,000 shares (the “Shares”) and to retain 390,000
      shares (the “Retained Shares”) of such common stock; and 

     

    WHEREAS,
      H2Diesel and Xethanol are parties to an Amended and Restated Sublicense
      Agreement, dated June 15, 2006 (the “Sublicense
      Agreement”),
      a
      Technology Access Agreement, dated June 15, 2006 (the “Technology
      Access Agreement”),
      and a
      Letter Agreement regarding Registration Rights, dated October 16, 2006 (the
      “Letter
      Agreement”,
      together with the Sublicense Agreement and Technology Access Agreement, the
      “H2Diesel/Xethanol
      Agreements”);
      and

     

    WHEREAS,
      Holdings desires to purchase and Xethanol desires to sell to Holdings all the
      Shares beneficially owned by Xethanol and all parties desire to terminate the
      H2Diesel/Xethanol Agreements; and

     

    WHEREAS,
      the parties hereto desire to effect the releases and waivers contemplated hereby
      in connection with the sale and purchase hereunder.

     

    NOW
      THEREFORE, for good and adequate consideration, the receipt and sufficiency
      of
      which is hereby acknowledged, Holdings, H2Diesel and Xethanol agree as
      follows:

     

    TERMS

     

    1. PURCHASE
      AND SALE OF SHARES

     

    Subject
      to the terms and conditions set forth in this Agreement, in reliance on the
      respective representations, warranties and covenants contained herein and in
      consideration for the releases set forth herein:

     

    1.1 At
      the
      Closing (as hereinafter defined), Xethanol will sell, convey, assign and
      transfer to Holdings free and clear of all Liens (as hereinafter defined),
      and
      Holdings will purchase and redeem from Xethanol, all of the Shares for an
      aggregate purchase price equal to $7,000,000 (the “Purchase
      Price”);
      and

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1.2 Upon
      execution of this Agreement, Holdings will pay Xethanol a non-refundable deposit
      of $250,000, which amount will be deducted from the Purchase Price payable
      at
      the Closing.

     

    2. CLOSING

     

    2.1 Condition
      to Closing.
      The
      Closing (as hereinafter defined) is conditioned upon the closing of a
      transaction in which Holdings obtains a minimum of $10,000,000 of new financing
      (the “Financing
      Transaction”).
      Holdings may waive this condition in its sole discretion by providing written
      notice to the other parties.

     

    2.2 Closing
      Date.
      The
      Closing will occur simultaneously with or at a reasonably prompt time after
      the
      closing of the Financing Transaction, or at such date, time and location as
      mutually agreed upon by all parties in writing (the “Closing”).

     

    2.3 Termination.
      If the
      Closing does not occur on or before November 9, 2007, or such later date as
      may
      be agreed by the parties in writing, each party shall have an independent right
      to terminate this Agreement upon ten (10) calendar days’ written notice to the
      other party. No party shall incur any obligation to the other party as a result
      of such termination, unless such termination results from a failure to close
      arising from a breach by a party of its obligations hereunder, in which case
      the
      non-breaching party shall be entitled to pursue remedies at law or equity.
      The
      failure of Holdings to satisfy the condition specified in Section 2.1 shall
      not
      be a breach. However, in the event of a termination other than as a result
      of a
      breach by Xethanol of its obligations hereunder, Xethanol shall retain the
      non-refundable deposit of $250,000.

     

    2.4 Deliveries
      at Closing.
      At the
      Closing, 

     

    (a) Xethanol
      shall deliver to Holdings

     

    
      	 	
              (i)

            	
              The
                stock certificates representing the Shares, duly endorsed in blank
                or
                accompanied by assignments separate from the certificates duly endorsed
                in
                blank; 

            

    

     

    
      	 	
              (ii)

            	
              Any
                other documents necessary to transfer to Holdings good, valid and
                marketable title to the Shares, and

            

    

     

    
      	 	
              (iii)

            	
              Originals
                of all promissory notes and instruments, each marked cancelled, evidencing
                any and all debt owed by Holdings or H2Diesel to Xethanol (the
                “Debt”);
                and

            

    

     

    
      	 	
              (iv)

            	
              Such
                other documents as may reasonably be requested by Holdings or
                H2Diesel to further document the termination and release occurring
                effective as of the Closing.

            

    

     

    (b) Holdings
      shall deliver to Xethanol $6,750,000, which is the Purchase Price for the Shares
      minus the $250,000 deposit previously delivered to Xethanol upon execution
      of
      the Agreement, by wire transfer of immediately available funds to a bank account
      previously designated by Xethanol. Holdings and H2Diesel
      shall also deliver such
      other
      documents as may reasonably be requested by Xethanol to
      further document the termination and release occurring effective as of the
      Closing.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    3. TERMINATION
      AND RELEASE

     

    3.1 Termination
      of H2Diesel/Xethanol
      Agreements.
      Effective as of the occurrence of the Closing, but not in the event that this
      Agreement terminates prior to the Closing occurring, the H2Diesel/Xethanol
      Agreements are hereby terminated, and are of no further force and effect, and
      no
      party thereto shall have any further rights or obligations
      thereunder; provided, however, that all provisions regarding confidential
      information shall survive such termination, including but not limited to section
      2.6 of the Sublicense Agreement regarding intellectual property rights and
      any
      defined terms included therein, and all confidential information given by
      Holdings or H2Diesel to Xethanol is returned within thirty days from the
      Closing. 

     

    3.2 Release
      by Holdings and H2Diesel.
      Effective as of the occurrence of the Closing, but not in the event that this
      Agreement terminates prior to the Closing occurring, Holdings and H2Diesel,
      on
      their own behalf and on behalf of their officers, directors, employees, agents,
      representatives, predecessors, successors and assigns (collectively,
“Representatives”),
      hereby irrevocably, unconditionally and forever (i) waive and relinquish any
      rights granted to H2Diesel pursuant to the H2Diesel/Xethanol
      Agreements
      and the other agreements and documents contemplated thereby, and
      (ii) release and discharge Xethanol and its Representatives from any and
      all manner of claims, liabilities and obligations whatsoever, whether known
      or
      unknown, accrued or not accrued, direct or indirect, in law or equity, arising
      from any source or manner whatsoever, including without limitation those arising
      from or relating to the H2Diesel/Xethanol Agreements
      or the other agreements and documents contemplated thereby, which may exist
      as
      of the date hereof or as of the date of Closing, or which may arise in the
      future based upon events that have occurred or documents signed at any time
      prior to the date hereof or the date of Closing.

     

    3.3 Release
      by Xethanol.
      Effective as of the occurrence of the Closing, but not in the event that this
      Agreement terminates prior to the Closing occurring, Xethanol, on behalf of
      itself and its Representatives, hereby irrevocably, unconditionally and forever
      (i) waives and relinquishes any rights it may have against or with respect
      to
      Holdings or H2Diesel or their Representatives pursuant to the H2Diesel/Xethanol
      Agreements
      and the other agreements and documents contemplated thereby, (ii) waives and
      relinquishes any right to repayment of principal and interest on any and all
      Debt, which the parties believe to be an aggregate amount of $50,000, and (iii)
      releases and discharges Holdings and H2Diesel and their respective
      Representatives from any and all manner of claims, liabilities and obligations
      whatsoever, whether known or unknown, accrued or not accrued, direct or
      indirect, in law or equity, arising from any source or manner whatsoever,
      including without limitation those arising from or relating to the H2Diesel/Xethanol
      Agreements
      or the other agreements and documents contemplated thereby, which may exist
      as
      of the date hereof or as of the date of Closing, or which may arise in the
      future based upon events that have occurred or documents signed at any time
      prior to the date hereof or the date of Closing.

     

    3.4 Effectiveness
      of Termination and Release.
      For the
      avoidance of doubt, the parties agree that the terminations, waivers and
      releases in this Article 3 shall be effective immediately when, but only when,
      the sale and purchase of the Shares and payment therefor has taken place at
      the
      Closing. In the event this Agreement terminates prior to the Closing the
      terminations, waivers and releases in this Article 3 shall be of no force or
      effect, and the H2Diesel/Xethanol Agreements
      shall continue in full force and effect. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    4. REPRESENTATIONS
      AND WARRANTIES

     

    4.1 Representations
      and Warranties of Xethanol.
      Xethanol
      represents and warrants to to Holdings and H2Diesel both on the date hereof
      and
      on the date of the Closing as follows:

     

    (a) Xethanol
      has the requisite power and authority to execute, deliver and carry out the
      terms and provisions of this Agreement and to consummate the transactions
      contemplated hereby, and has taken all necessary action to authorize the
      execution, delivery and performance of this Agreement;

     

    (b) The
      execution of this Agreement by Xethanol does not, and the performance by
      Xethanol of its obligations hereunder will not, constitute a violation of,
      conflict with or result in a default under any contract, commitment, agreement,
      understanding, arrangement or restriction of any kind to which Xethanol is
      a
      party or by which Xethanol is bound or any judgment, decree or order applicable
      to Xethanol;

     

    (c) To
      the
      best of its knowledge, neither the execution and delivery of this Agreement
      nor
      the performance by Xethanol of its obligations hereunder will violate any
      provision of law applicable to Xethanol or require any consent or approval
      of,
      or filing with or notice to any public body or authority under any provision
      of
      law applicable to Xethanol other than notices or filings pursuant to the federal
      securities laws; and

     

    (d) Xethanol
      is the sole record and beneficial owner (within the meaning of Rule 13d-3 under
      the Securities Exchange Act of 1934, as amended) of the Shares, has good and
      marketable title to all of the Shares, and there exist no liens, claims,
      options, proxies, voting agreements, charges, security interests, or
      encumbrances of whatever nature (“Liens”) affecting such Shares. Upon transfer
      of the Shares to Holdings by Xethanol, Holdings will have good and marketable
      title to the Shares free and clear of all Liens. Other than the Shares and
      the
      Retained Shares, Xethanol and its subsidiaries or affiliates do not beneficially
      own any other securities of Holdings or H2Diesel and do not have any outstanding
      option, warrant or other right to acquire, directly or indirectly, any
      securities of Holdings or H2Diesel which are or may by their terms become
      entitled to vote or any securities which are convertible or exchangeable into
      or
      exercisable for any securities of Holdings or H2Diesel which are or may by
      their
      terms become entitled to vote, and Xethanol is not subject to any offer,
      contract, arrangement, understanding or relationship (whether or not legally
      enforceable) which allows or obligates Xethanol to vote, dispose of or acquire
      any securities of Holdings or H2Diesel.

     

    4.2 Representations
      and Warranties of Holdings and H2Diesel.
      Holdings
      and H2Diesel represent and warrant to Xethanol both on the date hereof and
      on
      the date of the Closing as follows:

     

    (a) Holdings
      and H2Diesel have the requisite corporate power and authority to execute,
      deliver and to consummate the transactions contemplated hereby, and have taken
      all necessary corporate action to authorize the execution, delivery and
      performance of this Agreement; and

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b) The
      execution of this Agreement by Holdings and H2Diesel does not, and the
      performance by Holdings and H2Diesel of their obligations hereunder will not,
      to
      the best of their knowledge, constitute a violation of, conflict with or result
      in a default under any contract, commitment, agreement, understanding,
      arrangement or restriction of any kind to which the Holdings or H2Diesel is
      a
      party or by which Holdings or H2Diesel is bound.

     

    (c) To
      the
      best of their knowledge, neither the execution and delivery of this Agreement
      nor the performance by Holdings and H2Diesel of their obligations hereunder
      will
      violate any provision of law applicable to Holdings and H2Diesel or require
      any
      consent or approval of, or filing with or notice to any public body or authority
      under any provision of law applicable to Holdings and H2Diesel other than
      notices or filings pursuant to the federal securities laws.

     

    5. MISCELLANEOUS.

     

    5.1 Entire
      Agreement.
      This
      Agreement sets forth the entire agreement and supersedes any and all prior
      agreements of the parties with respect to the transactions set forth herein.
      

     

    5.2 Amendment,
      Waiver.
      No
      change, amendment or modification of any provision of this Agreement shall
      be
      valid unless set forth in a written instrument signed by the parties hereto,
      and
      no waiver of any provision of this Agreement shall be valid unless set forth
      in
      a written instrument signed by the party subject to enforcement of such
      waiver.

     

    5.3 Governing
      Law.
      The
      validity, construction and interpretation of this Agreement shall be governed
      by
      the laws of the State of New York, excluding any otherwise applicable rules
      of
      conflict that would cause the laws of another jurisdiction to
      apply.

     

    5.4 Further
      Assurances. 
      Each
      party shall take such action (including, the execution, acknowledgment and
      delivery of documents) as may reasonably be requested by any other party for
      the
      implementation or continuing performance of this Agreement.

     

    5.5 Construction;
      Severability.
      In the
      event that any provision of this Agreement conflicts with the law under which
      this Agreement is to be construed or if any such provision is held invalid
      by a
      court with jurisdiction over the parties to this Agreement, (i) such provision
      shall be deemed to be restated to reflect as nearly as possible the original
      intentions of the parties in accordance with applicable law, and (ii) the
      remaining terms, provisions, covenants and restrictions of this Agreement shall
      remain in full force and effect.

     

    5.6 Headings;
      Interpretation.
      The
      captions and headings used in this Agreement are inserted for convenience only
      and shall not affect the meaning or interpretation of this Agreement. Whenever
      the words “include”, “includes,” or “including” are used in this Agreement, they
      shall be deemed followed by the words “without limitation.”

     

    5.7 Confidentiality.
      Each
      Party agrees to keep any Confidential Information of the other parties
      confidential and agrees not to disclose such information. Notwithstanding the
      foregoing, the parties may make disclosures to the extent required by law or
      by
      the applicable rules and regulations of a securities exchange or national market
      system on which a disclosing Party’s shares are listed or traded.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    5.8 Counterparts;
      Facsimile.
      This
      Agreement may be executed in counterparts, each of which shall be deemed an
      original and all of which together shall constitute one and the same document.
      This Agreement, and written amendments hereto, may be executed by
      facsimile. 

     

    IN
      WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
      date
      above first written.

     

    
      	 	 	 
	 	
              H2DIESEL
                HOLDINGS, INC.

            
	 
 	 
 	 
 
	
            	By:  	/s/
              David A. Gillespie
	 	
              

              Name:
                David A. Gillespie

            
	 	
              Title:   President

            

    

     

    
      	 	 	 
	 	
              H2DIESEL,
                INC.

            
	 
 	 
 	 
 
	
            	By:  	/s/ David A. Gillespie
	 	
              

              
                Name:
                  David A. Gillespie

              

            
	 	
              
                Title:   President

              

            

    

     

    
      	 	 	 
	 	
              XETHANOL
                CORPORATION

            
	 
 	 
 	 
 
	 	By:  	/s/ David Ames
	 	
              

              Name:
                David Ames

            
	 	
              
                Title:   Chief
                  Executive OfficerUnassociated Document

     

    EXHIBIT
      4.1

     

    THIS
      WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT
      BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
      ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
      DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE
      STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF COUNSEL
      REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH SECURITIES
      UNDER
      THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES
      LAWS
      IS NOT REQUIRED.

     

    SERIES
      A
      WARRANT TO PURCHASE

     

    SHARES
      OF
      COMMON STOCK

     

    OF

     

    VICTORY
      DIVIDE MINING COMPANY

     

    Expires
      on October 2, 2012

     

     

    
      	No.: W-A-07-  	Number of Shares: Up to
              ________

    

    Date
      of
      Issuance: October 3, 2007

     

    FOR
      VALUE
      RECEIVED, the undersigned, Victory Divide Mining Company, a Nevada corporation
      (together with its successors and assigns, the “Issuer”),
      hereby certifies that ____________
      or
      its
      registered assigns (the “Holder”)
      is
      entitled to subscribe for and purchase, during the Term (as hereinafter
      defined), up to ____________
      shares
      (subject to adjustment as hereinafter provided) of the duly authorized, validly
      issued, fully paid and non-assessable Common Stock of the Issuer, at an exercise
      price per share equal to the Warrant Price then in effect, subject, however,
      to
      the provisions and upon the terms and conditions hereinafter set forth.

     

    1. Term.
      The
      term of this Warrant shall commence on October 3, 2007 and shall expire at
      6:00
      p.m., Eastern Time, on October 2, 2012 (such period being the “Term”
and
      such date, the “Termination
      Date”).

     

    2. Method
      of Exercise; Payment; Issuance of New Warrant; Transfer and
      Exchange.

     

    (a) Time
      of Exercise.
      The
      purchase rights represented by this Warrant may be exercised in whole or in
      part
      during the Term for such number of shares of Common Stock set forth above,
      which
      number is equal to one hundred percent (100%) of the number of shares of Common
      Stock into which the Series A Convertible Preferred Stock issued by the Issuer
      to the Holder on the Original Issue Date pursuant to the Purchase Agreement
      may
      be converted.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b) Method
      of Exercise.
      The
      Holder hereof may exercise this Warrant, in whole or in part, by the surrender
      of this Warrant (with the exercise form attached hereto duly executed) at the
      principal office of the Issuer, and by the payment to the Issuer of an amount
      of
      consideration therefor equal to the Warrant Price in effect on the date of
      such
      exercise multiplied by the number of shares of Warrant Stock with respect to
      which this Warrant is then being exercised, payable at such Holder’s election
      (i) by certified or official bank check or by wire transfer to an account
      designated by the Issuer, (ii) by “cashless exercise” in accordance with Section
      2(c), but only when a registration statement under the Securities Act providing
      for the resale of the Warrant Stock is not then in effect, or (iii) by a
      combination of the foregoing methods of payment selected by the Holder of this
      Warrant.

     

    (c) Cashless
      Exercise.
      Notwithstanding any provision herein to the contrary, and (i) the volume
      weighted average price of one share of Common Stock on the OTC Bulletin Board
      or
      such other securities exchange on which the Common Stock is then traded or
      included for quotation, for any ten (10) consecutive Trading Days is greater
      than the Warrant Price (at or prior to the date of calculation as set forth
      below) and (ii) commencing eighteen (18) months following the Original Issue
      Date if a registration statement under the Securities Act providing for the
      resale of the Warrant Stock (A) has not been declared effective by the
      Securities and Exchange Commission by the date such registration statement
      is
      required to be effective pursuant to the Registration Rights Agreement (as
      defined in Section 8), or (B) is not effective at the time of exercise of this
      Warrant, unless the registration statement is not effective as a result of
      the
      Issuer exercising its rights under Section 3(n) of the Registration Rights
      Agreement, in lieu of exercising this Warrant by payment of cash, the Holder
      may
      exercise this Warrant by a cashless exercise and shall receive the number of
      shares of Common Stock equal to an amount (as determined below) by surrender
      of
      this Warrant at the principal office of the Issuer together with the properly
      endorsed Notice of Exercise in which event the Issuer shall issue to the Holder
      a number of shares of Common Stock computed using the following
      formula:

    
      	 	 
	 	
              X
                =
                Y - (A)(Y)

            
	 	
              B

            
	 	 	 
	
              Where
                

            	
              X
                =
                

            	
              the
                number of shares of Common Stock to be issued to the
                Holder.

            
	 	 	 
	 	
              Y
                =
                

            	
              the
                number of shares of Common Stock purchasable upon exercise of all
                of the
                Warrant or, if only a portion of the Warrant is being exercised,
                the
                portion of the Warrant being exercised.

            
	 	 	 
	 	
              A
                =
                

            	
              the
                Warrant Price.

            
	 	 	 
	 	
              B
                =
                

            	
              the
                Per Share Market Value of one share of Common
                Stock.

            

    

     

    (d) Issuance
      of Stock Certificates.
      In the
      event of any exercise of this Warrant in accordance with and subject to the
      terms and conditions hereof, certificates for the shares of Warrant Stock so
      purchased shall be dated the date of such exercise and delivered to the Holder
      hereof within a reasonable time, not exceeding three (3) Trading Days after
      such
      exercise (the “Delivery
      Date”)
      or, at
      the request of the Holder (provided that a registration statement under the
      Securities Act providing for the resale of the Warrant Stock is then in effect
      or that the shares of Warrant Stock are otherwise exempt from registration),
      issued and delivered to the Depository Trust Company (“DTC”)
      account on the Holder’s behalf via the Deposit Withdrawal Agent Commission
      System (“DWAC”)
      within
      a reasonable time, not exceeding three (3) Trading Days after such exercise,
      and
      the Holder hereof shall be deemed for all purposes to be the holder of the
      shares of Warrant Stock so purchased as of the date of such exercise.
      Notwithstanding the foregoing to the contrary, the Issuer or its transfer agent
      shall only be obligated to issue and deliver the shares to the DTC on a holder’s
      behalf via DWAC if such exercise is in connection with a sale or other exemption
      from registration by which the shares may be issued without a restrictive legend
      and the Issuer and its transfer agent are participating in DTC through the
      DWAC
      system. The Holder shall deliver this original Warrant, or an indemnification
      undertaking with respect to such Warrant in the case of its loss, theft or
      destruction, at such time that this Warrant is fully exercised. With respect
      to
      partial exercises of this Warrant, the Issuer shall keep written records for
      the
      Holder of the number of shares of Warrant Stock exercised as of each date of
      exercise.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (e) Compensation
      for Buy-In on Failure to Timely Deliver Certificates Upon
      Exercise.
      In
      addition to any other rights available to the Holder, if the Issuer fails to
      cause its transfer agent to transmit to the Holder a certificate or certificates
      representing the Warrant Stock pursuant to an exercise on or before the Delivery
      Date, and if after such date the Holder is required by its broker to purchase
      (in an open market transaction or otherwise) shares of Common Stock to deliver
      in satisfaction of a sale by the Holder of the Warrant Stock which the Holder
      anticipated receiving upon such exercise (a “Buy-In”),
      then
      the Issuer shall (1) pay in cash to the Holder the amount by which (x) the
      Holder’s total purchase price (including brokerage commissions, if any) for the
      shares of Common Stock so purchased exceeds (y) the amount obtained by
      multiplying (A) the number of shares of Warrant Stock that the Issuer was
      required to deliver to the Holder in connection with the exercise at issue
      times
      (B) the price at which the sell order giving rise to such purchase obligation
      was executed, and (2) at the option of the Holder, either reinstate the portion
      of the Warrant and equivalent number of shares of Warrant Stock for which such
      exercise was not honored or deliver to the Holder the number of shares of Common
      Stock that would have been issued had the Issuer timely complied with its
      exercise and delivery obligations hereunder. For example, if the Holder
      purchases Common Stock having a total purchase price of $11,000 to cover a
      Buy-In with respect to an attempted exercise of shares of Common Stock with
      an
      aggregate sale price giving rise to such purchase obligation of $10,000, under
      clause (1) of the immediately preceding sentence the Issuer shall be required
      to
      pay the Holder $1,000. The Holder shall provide the Issuer written notice
      indicating the amounts payable to the Holder in respect of the Buy-In, together
      with applicable confirmations and other evidence reasonably requested by the
      Issuer. Nothing herein shall limit a 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
      Issuer’s failure to timely deliver certificates representing shares of Common
      Stock upon exercise of this Warrant as required pursuant to the terms
      hereof.

     

    (f) Transferability
      of Warrant.
      Subject
      to Section 2(h) hereof, this Warrant may be transferred by a Holder, in whole
      or
      in part, without the consent of the Issuer. If transferred pursuant to this
      paragraph, this Warrant may be transferred on the books of the Issuer by the
      Holder hereof in person or by duly authorized attorney, upon surrender of this
      Warrant at the principal office of the Issuer, properly endorsed (by the Holder
      executing an assignment in the form attached hereto) and upon payment of any
      necessary transfer tax or other governmental charge imposed upon such transfer.
      This Warrant is exchangeable at the principal office of the Issuer for Warrants
      to purchase the same aggregate number of shares of Warrant Stock, each new
      Warrant to represent the right to purchase such number of shares of Warrant
      Stock as the Holder hereof shall designate at the time of such exchange. All
      Warrants issued on transfers or exchanges shall be dated the Original Issue
      Date
      and shall be identical with this Warrant except as to the number of shares
      of
      Warrant Stock issuable pursuant thereto.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (g) Continuing
      Rights of Holder.
      The
      Issuer will, at the time of or at any time after each exercise of this Warrant,
      upon the request of the Holder hereof, acknowledge in writing the extent, if
      any, of its continuing obligation to afford to such Holder all rights to which
      such Holder shall continue to be entitled after such exercise in accordance
      with
      the terms of this Warrant, provided that if any such Holder shall fail to make
      any such request, the failure shall not affect the continuing obligation of
      the
      Issuer to afford such rights to such Holder.

     

    (h) Compliance
      with Securities Laws.

     

    (i) The
      Holder of this Warrant, by acceptance hereof, acknowledges that this Warrant
      and
      the shares of Warrant Stock to be issued upon exercise hereof are being acquired
      solely for the Holder’s own account and not as a nominee for any other party,
      and for investment, and that the Holder will not offer, sell or otherwise
      dispose of this Warrant or any shares of Warrant Stock to be issued upon
      exercise hereof except pursuant to an effective registration statement, or
      an
      exemption from registration, under the Securities Act and any applicable state
      securities laws.

     

    (ii) Except
      as
      provided in paragraph (iii) below, this Warrant and all certificates
      representing shares of Warrant Stock issued upon exercise hereof shall be
      stamped or imprinted with a legend in substantially the following
      form:

     

    THIS
      WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT
      BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
      ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
      DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE
      STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF COUNSEL
      REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH SECURITIES
      UNDER
      THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES
      LAWS
      IS NOT REQUIRED.

     

    (iii) The
      Issuer agrees to reissue this Warrant or certificates representing any of the
      Warrant Stock, without the legend set forth above if at such time, prior to
      making any transfer of any such securities, the Holder shall give written notice
      to the Issuer describing the manner and terms of such transfer. Such proposed
      transfer will not be effected until: (a) either (i) the Issuer has received
      an
      opinion of counsel reasonably satisfactory to the Issuer, to the effect that
      the
      registration of such securities under the Securities Act is not required in
      connection with such proposed transfer, (ii) a registration statement under
      the
      Securities Act covering such proposed disposition has been filed by the Issuer
      with the Securities and Exchange Commission and has become effective under
      the
      Securities Act, (iii) the Issuer has received other evidence reasonably
      satisfactory to the Issuer that such registration and qualification under the
      Securities Act and state securities laws are not required, or (iv) the Holder
      provides the Issuer with reasonable assurances that such security can be sold
      pursuant to Rule 144 under the Securities Act; and (b) either (i) the Issuer
      has
      received an opinion of counsel reasonably satisfactory to the Issuer, to the
      effect that registration or qualification under the securities or “blue sky”
laws of any state is not required in connection with such proposed disposition,
      or (ii) compliance with applicable state securities or “blue sky” laws has been
      effected or a valid exemption exists with respect thereto. The Issuer will
      respond to any such notice from a holder within three (3) Trading Days. In
      the
      case of any proposed transfer under this Section 2(h), the Issuer will use
      reasonable efforts to comply with any such applicable state securities or “blue
      sky” laws, but shall in no event be required, (x) to qualify to do business in
      any state where it is not then qualified, (y) to take any action that would
      subject it to tax or to the general service of process in any state where it
      is
      not then subject, or (z) to comply with state securities or “blue sky” laws of
      any state for which registration by coordination is unavailable to the Issuer.
      The restrictions on transfer contained in this Section 2(h) shall be in addition
      to, and not by way of limitation of, any other restrictions on transfer
      contained in any other section of this Warrant. Whenever a certificate
      representing the Warrant Stock is required to be issued to the Holder without
      a
      legend, in lieu of delivering physical certificates representing the Warrant
      Stock, the Issuer shall cause its transfer agent to electronically transmit
      the
      Warrant Stock to the Holder by crediting the account of the Holder or Holder’s
      Prime Broker with DTC through its DWAC system (to the extent not inconsistent
      with any provisions of this Warrant or the Purchase Agreement).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (i) Accredited
      Investor Status.
      In no
      event may the Holder exercise this Warrant in whole or in part unless the Holder
      is an “accredited investor” as defined in Regulation D under the Securities
      Act.

     

    3. Stock
      Fully Paid; Reservation and Listing of Shares; Covenants.

     

    (a) Stock
      Fully Paid.
      The
      Issuer represents, warrants, covenants and agrees that all shares of Warrant
      Stock which may be issued upon the exercise of this Warrant or otherwise
      hereunder will, when issued in accordance with the terms of this Warrant, be
      duly authorized, validly issued, fully paid and non-assessable and free from
      all
      taxes, liens and charges created by or through the Issuer. The Issuer further
      covenants and agrees that during the period within which this Warrant may be
      exercised, the Issuer will at all times have authorized and reserved for the
      purpose of the issuance upon exercise of this Warrant a number of authorized
      but
      unissued shares of Common Stock equal to at least one hundred percent (100%)
      of
      the number of shares of Common Stock issuable upon exercise of this Warrant
      without regard to any limitations on exercise.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b) Reservation.
      If any
      shares of Common Stock required to be reserved for issuance upon exercise of
      this Warrant or as otherwise provided hereunder require registration or
      qualification with any Governmental Authority under any federal or state law
      before such shares may be so issued, the Issuer will in good faith use its
      best
      efforts as expeditiously as possible at its expense to cause such shares to
      be
      duly registered or qualified. If the Issuer shall list any shares of Common
      Stock on any securities exchange or market it will, at its expense, list
      thereon, and maintain and increase when necessary such listing, of, all shares
      of Warrant Stock from time to time issued upon exercise of this Warrant or
      as
      otherwise provided hereunder (provided that such Warrant Stock has been
      registered pursuant to a registration statement under the Securities Act then
      in
      effect), and, to the extent permissible under the applicable securities exchange
      rules, all unissued shares of Warrant Stock which are at any time issuable
      hereunder, so long as any shares of Common Stock shall be so listed. The Issuer
      will also so list on each securities exchange or market, and will maintain
      such
      listing of, any other securities which the Holder of this Warrant shall be
      entitled to receive upon the exercise of this Warrant if at the time any
      securities of the same class shall be listed on such securities exchange or
      market by the Issuer.

     

    (c) Covenants.
      The
      Issuer shall not by any action including, without limitation, amending the
      Articles of Incorporation or the by-laws of the Issuer, or through any
      reorganization, transfer of assets, consolidation, merger, dissolution, issue
      or
      sale of securities or any other 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 the Holder
      hereof against dilution (to the extent specifically provided herein) or
      impairment. Without limiting the generality of the foregoing, the Issuer will
      (i) not permit the par value, if any, of its Common Stock to exceed the then
      effective Warrant Price, (ii) not amend or modify any provision of the Articles
      of Incorporation or by-laws of the Issuer in any manner that would adversely
      affect the rights of the Holders of the Warrants, (iii) take all such action
      as
      may be reasonably necessary in order that the Issuer may validly and legally
      issue fully paid and nonassessable shares of Common Stock, free and clear of
      any
      liens, claims, encumbrances and restrictions (other than as provided herein)
      upon the exercise of this Warrant, and (iv) use its best efforts to obtain
      all
      such authorizations, exemptions or consents from any public regulatory body
      having jurisdiction thereof as may be reasonably necessary to enable the Issuer
      to perform its obligations under this Warrant.

     

    (d) Loss,
      Theft, Destruction of Warrants.
      Upon
      receipt of evidence satisfactory to the Issuer of the ownership of and the
      loss,
      theft, destruction or mutilation of any Warrant and, in the case of any such
      loss, theft or destruction, upon receipt of indemnity or security satisfactory
      to the Issuer or, in the case of any such mutilation, upon surrender and
      cancellation of such Warrant, the Issuer will make and deliver, in lieu of
      such
      lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and
      representing the right to purchase the same number of shares of Common
      Stock.

     

    (e) Payment
      of Taxes.
      The
      Issuer will pay any documentary stamp taxes attributable to the initial issuance
      of the Warrant Stock issuable upon exercise of this Warrant; provided,
      however,
      that
      the Issuer shall not be required to pay any tax or taxes which may be payable
      in
      respect of any transfer involved in the issuance or delivery of any certificates
      representing Warrant Stock in a name other than that of the Holder in respect
      to
      which such shares are issued.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    4. Adjustment
      of Warrant Price.
      The
      price at which such shares of Warrant Stock may be purchased upon exercise
      of
      this Warrant shall be subject to adjustment from time to time as set forth
      in
      this Section 4. The Issuer shall give the Holder notice of any event described
      below which requires an adjustment pursuant to this Section 4 in accordance
      with
      the notice provisions set forth in Section 5.

     

    (a) Recapitalization,
      Reorganization, Reclassification, Consolidation, Merger or Sale.

     

    (i) In
      case
      the Issuer after the Original Issue Date shall do any of the following (each,
      a
“Triggering
      Event”):
      (a)
      consolidate or merge with or into any other Person and the Issuer shall not
      be
      the continuing or surviving corporation of such consolidation or merger, or
      (b)
      permit any other Person to consolidate with or merge into the Issuer and the
      Issuer shall be the continuing or surviving Person but, in connection with
      such
      consolidation or merger, any Capital Stock of the Issuer shall be changed into
      or exchanged for Securities of any other Person or cash or any other property,
      or (c) transfer all or substantially all of its properties or assets to any
      other Person, or (d) effect a capital reorganization or reclassification of
      its
      Capital Stock, then, and in the case of each such Triggering Event, proper
      provision shall be made to the Warrant Price and the number of shares of Warrant
      Stock that may be purchased upon exercise of this Warrant so that, upon the
      basis and the terms and in the manner provided in this Warrant, the Holder
      of
      this Warrant shall be entitled upon the exercise hereof at any time after the
      consummation of such Triggering Event, to the extent this Warrant is not
      exercised prior to such Triggering Event, to receive at the Warrant Price in
      effect at the time immediately prior to the consummation of such Triggering
      Event, in lieu of the Common Stock issuable upon such exercise of this Warrant
      prior to such Triggering Event, the Securities, cash and property to which
      such
      Holder would have been entitled upon the consummation of such Triggering Event
      if such Holder had exercised the rights represented by this Warrant immediately
      prior thereto (including the right of a shareholder to elect the type of
      consideration it will receive upon a Triggering Event), subject to adjustments
      (subsequent to such corporate action) as nearly equivalent as possible to the
      adjustments provided for elsewhere in this Section 4; provided,
      however,
      the
      Holder at its option may elect to receive an amount in unregistered shares
      of
      the common stock of the surviving entity equal to the value of this Warrant
      calculated in accordance with the Black-Scholes formula; provided,
      further,
      such
      shares of Common Stock shall be valued at a twenty percent (20%) discount to
      the
      VWAP of the Common Stock for the twenty (20) Trading Days immediately prior
      to
      the Triggering Event. Immediately upon the occurrence of a Triggering Event,
      the
      Issuer shall notify the Holder in writing of such Triggering Event and provide
      the calculations in determining the number of shares of Warrant Stock issuable
      upon exercise of the new warrant and the adjusted Warrant Price. Upon the
      Holder’s request, the continuing or surviving corporation as a result of such
      Triggering Event shall issue to the Holder a new warrant of like tenor
      evidencing the right to purchase the adjusted number of shares of Warrant Stock
      and the adjusted Warrant Price pursuant to the terms and provisions of this
      Section 4(a)(i). Notwithstanding the foregoing to the contrary, this Section
      4(a)(i) shall only apply if the surviving entity pursuant to any such Triggering
      Event is a company that has a class of equity securities registered pursuant
      to
      the Securities Exchange Act of 1934, as amended (the “Exchange
      Act”),
      and
      its common stock is listed or quoted on a national securities exchange, national
      automated quotation system or the OTC Bulletin Board. In the event that the
      surviving entity pursuant to any such Triggering Event is not a public company
      that is registered pursuant to the Exchange Act or its common stock is not
      listed or quoted on a national securities exchange, national automated quotation
      system or the OTC Bulletin Board, then the Holder shall have the right to demand
      that the Issuer pay to the Holder an amount in cash equal to the value of this
      Warrant calculated in accordance with the Black-Scholes
      formula.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (ii) In
      the
      event that the Holder has elected not to exercise this Warrant prior to the
      consummation of a Triggering Event and has also elected not to receive an amount
      in cash equal to the value of this Warrant calculated in accordance with the
      Black-Scholes formula pursuant to the provisions of Section 4(a)(i) above,
      so
      long as the surviving entity pursuant to any Triggering Event is a company
      that
      has a class of equity securities registered pursuant to the Exchange Act and
      its
      common stock is listed or quoted on a national securities exchange, national
      automated quotation system or the OTC Bulletin Board, the surviving entity
      and/or each Person (other than the Issuer) which may be required to deliver
      any
      Securities, cash or property upon the exercise of this Warrant as provided
      herein shall assume, by written instrument delivered to, and reasonably
      satisfactory to, the Holder of this Warrant, (A) the obligations of the Issuer
      under this Warrant (and if the Issuer shall survive the consummation of such
      Triggering Event, such assumption shall be in addition to, and shall not release
      the Issuer from, any continuing obligations of the Issuer under this Warrant)
      and (B) the obligation to deliver to such Holder such Securities, cash or
      property as, in accordance with the foregoing provisions of this subsection
      (a),
      such Holder shall be entitled to receive, and the surviving entity and/or each
      such Person shall have similarly delivered to such Holder an opinion of counsel
      for the surviving entity and/or each such Person, which counsel shall be
      reasonably satisfactory to such Holder, or in the alternative, a written
      acknowledgement executed by the President or Chief Financial Officer of the
      Issuer, stating that this Warrant shall thereafter continue in full force and
      effect and the terms hereof (including, without limitation, all of the
      provisions of this subsection (a)) shall be applicable to the Securities, cash
      or property which the surviving entity and/or each such Person may be required
      to deliver upon any exercise of this Warrant or the exercise of any rights
      pursuant hereto.

     

    (b) Stock
      Dividends, Subdivisions and Combinations.
      If at
      any time the Issuer shall:

     

    (i) make
      or
      issue or set a record date for the holders of the Common Stock for the purpose
      of entitling them to receive a dividend payable in, or other distribution of,
      shares of Common Stock,

     

    (ii) subdivide
      its outstanding shares of Common Stock into a larger number of shares of Common
      Stock, or

     

    (iii) combine
      its outstanding shares of Common Stock into a smaller number of shares of Common
      Stock,

     

    then
      (1)
      the number of shares of Common Stock for which this Warrant is exercisable
      immediately after the occurrence of any such event shall be adjusted to equal
      the number of shares of Common Stock which a record holder of the same number
      of
      shares of Common Stock for which this Warrant is exercisable immediately prior
      to the occurrence of such event would own or be entitled to receive after the
      happening of such event, and (2) the Warrant Price then in effect shall be
      adjusted to equal (A) the Warrant Price then in effect multiplied by the number
      of shares of Common Stock for which this Warrant is exercisable immediately
      prior to the adjustment divided by (B) the number of shares of Common Stock
      for
      which this Warrant is exercisable immediately after such
      adjustment.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (c) Certain
      Other Distributions.
      If at
      any time the Issuer shall make or issue or set a record date for the holders
      of
      the Common Stock for the purpose of entitling them to receive any dividend
      or
      other distribution of:

     

    (i) cash,

     

    (ii) any
      evidences of its indebtedness, any shares of stock of any class or any other
      securities or property of any nature whatsoever (other than cash, Common Stock
      Equivalents or Additional Shares of Common Stock), or

     

    (iii) any
      warrants or other rights to subscribe for or purchase any evidences of its
      indebtedness, any shares of stock of any class or any other securities or
      property of any nature whatsoever (other than cash, Common Stock Equivalents
      or
      Additional Shares of Common Stock),

     

    then
      (1)
      the number of shares of Common Stock for which this Warrant is exercisable
      shall
      be adjusted to equal the product of the number of shares of Common Stock for
      which this Warrant is exercisable immediately prior to such adjustment
      multiplied by a fraction (A) the numerator of which shall be the Per Share
      Market Value of Common Stock at the date of taking such record and (B) the
      denominator of which shall be such Per Share Market Value minus the amount
      allocable to one share of Common Stock of any such cash so distributable and
      of
      the fair value (as determined in good faith by the Board of Directors of the
      Issuer and supported by an opinion from an investment banking firm mutually
      agreed upon by the Issuer and the Holder) of any and all such evidences of
      indebtedness, shares of stock, other securities or property or warrants or
      other
      subscription or purchase rights so distributable, and (2) the Warrant Price
      then
      in effect shall be adjusted to equal (A) the Warrant Price then in effect
      multiplied by the number of shares of Common Stock for which this Warrant is
      exercisable immediately prior to the adjustment divided by (B) the number of
      shares of Common Stock for which this Warrant is exercisable immediately after
      such adjustment. A reclassification of the Common Stock (other than a change
      in
      par value, or from par value to no par value or from no par value to par value)
      into shares of Common Stock and shares of any other class of stock shall be
      deemed a distribution by the Issuer to the holders of its Common Stock of such
      shares of such other class of stock within the meaning of this Section 4(c)
      and,
      if the outstanding shares of Common Stock shall be changed into a larger or
      smaller number of shares of Common Stock as a part of such reclassification,
      such change shall be deemed a subdivision or combination, as the case may be,
      of
      the outstanding shares of Common Stock within the meaning of Section
      4(b).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (d) Issuance
      of Additional Shares of Common Stock.
      

     

    (i) For
      the
      period commencing on the Original Issue Date and ending on the two (2) year
      anniversary of the Original Issue Date, in the event the Issuer shall issue
      any
      Additional Shares of Common Stock (otherwise than as provided in the foregoing
      subsections (a) through (c) of this Section 4), at a price per share less than
      the Warrant Price then in effect or without consideration, then the Warrant
      Price upon each such issuance shall be adjusted to the price equal to the
      consideration per share paid for such Additional Shares of Common
      Stock.

     

    (ii) For
      the
      period commencing on the two (2) year anniversary of the Original Issue Date
      and
      ending on the Termination Date, in the event the Issuer shall issue any
      Additional Shares of Common Stock (otherwise than as provided in the foregoing
      subsections (a) through (c) of this Section 4), at a price per share less than
      the Warrant Price then in effect or without consideration, then the Warrant
      Price then in effect shall multiplied by a fraction (a) the numerator of which
      shall be equal to the sum of (x) the number of shares of outstanding Common
      Stock immediately prior to the issuance of such Additional Shares of Common
      Stock plus (y) the number of shares of Common Stock (rounded to the nearest
      whole share) which the aggregate consideration for the total number of such
      Additional Shares of Common Stock so issued would purchase at a price per share
      equal to the Warrant Price then in effect and (b) the denominator of which
      shall
      be equal to the number of shares of outstanding Common Stock immediately after
      the issuance of such Additional Shares of Common Stock. For purposes of this
      Section, all shares of Common Stock issuable upon exercise of options
      outstanding immediately prior to such issue or upon conversion of Convertible
      Securities (as defined below) (including Series A Convertible Preferred Stock
      of
      the Company, par value $.001 per share) outstanding immediately prior to such
      issue are deemed outstanding. No adjustment of the number of shares of Common
      Stock for which this Warrant shall be exercisable shall be made pursuant to
      this
      Section 4(d)(ii) upon the issuance of any Additional Shares of Common Stock
      which are issued pursuant to the exercise of any Common Stock Equivalents,
      if
      any such adjustment shall previously have been made upon the issuance of such
      Common Stock Equivalents (or upon the issuance of any warrant or other rights
      therefor) pursuant to Section 4(e).

     

    (e) Issuance
      of Common Stock Equivalents.
      In the
      event the Issuer shall take a record of the holders of its Common Stock for
      the
      purpose of entitling them to receive a distribution of, or shall in any manner
      (whether directly or by assumption in a merger in which the Issuer is the
      surviving corporation) issue or sell, any Common Stock Equivalents, whether
      or
      not the rights to exchange or convert thereunder are immediately exercisable,
      and the price per share for which Common Stock is issuable upon such conversion
      or exchange shall be less than the Warrant Price in effect immediately prior
      to
      the time of such issue or sale, or if, after any such issuance of Common Stock
      Equivalents, the price per share for which Additional Shares of Common Stock
      may
      be issuable thereafter is amended or adjusted, and such price as so amended
      shall be less than the Warrant Price in effect at the time of such amendment
      or
      adjustment, then the Warrant Price then in effect shall be adjusted as provided
      in Section 4(d)(i) or (ii), as applicable. No further adjustments of the number
      of shares of Common Stock for which this Warrant is exercisable and the Warrant
      Price then in effect shall be made upon the actual issue of such Common Stock
      upon conversion or exchange of such Common Stock Equivalents.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (f) Other
      Provisions Applicable to Adjustments under this Section.
      The
      following provisions shall be applicable to the making of adjustments of the
      number of shares of Common Stock for which this Warrant is exercisable and
      the
      Warrant Price then in effect provided for in this Section 4:

     

    (i) Computation
      of Consideration.
      To the
      extent that any Additional Shares of Common Stock or any Common Stock
      Equivalents (or any warrants or other rights therefor) shall be issued for
      cash
      consideration, the consideration received by the Issuer therefor shall be the
      amount of the cash received by the Issuer therefor, or, if such Additional
      Shares of Common Stock or Common Stock Equivalents are offered by the Issuer
      for
      subscription, the subscription price, or, if such Additional Shares of Common
      Stock or Common Stock Equivalents are sold to underwriters or dealers for public
      offering without a subscription offering, the initial public offering price
      (in
      any such case subtracting any amounts paid or receivable for accrued interest
      or
      accrued dividends and without taking into account any compensation, discounts
      or
      expenses paid or incurred by the Issuer for and in the underwriting of, or
      otherwise in connection with, the issuance thereof). In connection with any
      merger or consolidation in which the Issuer is the surviving corporation (other
      than any consolidation or merger in which the previously outstanding shares
      of
      Common Stock of the Issuer shall be changed to or exchanged for the stock or
      other securities of another corporation), the amount of consideration therefore
      shall be, deemed to be the fair value, as determined reasonably and in good
      faith by the Board, and acceptable to the Holder, of such portion of the assets
      and business of the nonsurviving corporation as the Board may determine to
      be
      attributable to such shares of Common Stock or Common Stock Equivalents, as
      the
      case may be. The consideration for any Additional Shares of Common Stock
      issuable pursuant to any warrants or other rights to subscribe for or purchase
      the same shall be the consideration received by the Issuer for issuing such
      warrants or other rights plus the additional consideration payable to the Issuer
      upon exercise of such warrants or other rights. The consideration for any
      Additional Shares of Common Stock issuable pursuant to the terms of any Common
      Stock Equivalents shall be the consideration received by the Issuer for issuing
      warrants or other rights to subscribe for or purchase such Common Stock
      Equivalents, plus the consideration paid or payable to the Issuer in respect
      of
      the subscription for or purchase of such Common Stock Equivalents, plus the
      additional consideration, if any, payable to the Issuer upon the exercise of
      the
      right of conversion or exchange in such Common Stock Equivalents. In the event
      of any consolidation or merger of the Issuer in which the Issuer is not the
      surviving corporation or in which the previously outstanding shares of Common
      Stock of the Issuer shall be changed into or exchanged for the stock or other
      securities of another corporation, or in the event of any sale of all or
      substantially all of the assets of the Issuer for stock or other securities
      of
      any corporation, the Issuer shall be deemed to have issued a number of shares
      of
      its Common Stock for stock or securities or other property of the other
      corporation computed on the basis of the actual exchange ratio on which the
      transaction was predicated, and for a consideration equal to the fair market
      value on the date of such transaction of all such stock or securities or other
      property of the other corporation. In the event any consideration received
      by
      the Issuer for any securities consists of property other than cash, the fair
      market value thereof at the time of issuance or as otherwise applicable shall
      be
      as determined in good faith by the Board. In the event Common Stock is issued
      with other shares or securities or other assets of the Issuer for consideration
      which covers both, the consideration computed as provided in this Section
      4(g)(i) shall be allocated among such securities and assets as determined in
      good faith by the Board.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (ii) When
      Adjustments to Be Made.
      The
      adjustments required by this Section 4 shall be made whenever and as often
      as
      any specified event requiring an adjustment shall occur, except that any
      adjustment of the number of shares of Common Stock for which this Warrant is
      exercisable that would otherwise be required may be postponed (except in the
      case of a subdivision or combination of shares of the Common Stock, as provided
      for in Section 4(b)) up to, but not beyond the date of exercise if such
      adjustment either by itself or with other adjustments not previously made adds
      or subtracts less than one percent (1%) of the shares of Common Stock for which
      this Warrant is exercisable immediately prior to the making of such adjustment.
      Any adjustment representing a change of less than such minimum amount (except
      as
      aforesaid) which is postponed shall be carried forward and made as soon as
      such
      adjustment, together with other adjustments required by this Section 4 and
      not
      previously made, would result in a minimum adjustment or on the date of
      exercise. For the purpose of any adjustment, any specified event shall be deemed
      to have occurred at the close of business on the date of its
      occurrence.

     

    (iii) Fractional
      Interests.
      In
      computing adjustments under this Section 4, fractional interests in Common
      Stock
      shall be taken into account to the nearest one one-hundredth (1/100th) of a
      share.

     

    (iv) When
      Adjustment Not Required.
      If the
      Issuer shall take a record of the holders of its Common Stock for the purpose
      of
      entitling them to receive a dividend or distribution or subscription or purchase
      rights and shall, thereafter and before the distribution to stockholders
      thereof, legally abandon its plan to pay or deliver such dividend, distribution,
      subscription or purchase rights, then thereafter no adjustment shall be required
      by reason of the taking of such record and any such adjustment previously made
      in respect thereof shall be rescinded and annulled.

     

    (g) Form
      of Warrant after Adjustments.
      The
      form of this Warrant need not be changed because of any adjustments in the
      Warrant Price or the number and kind of Securities purchasable upon the exercise
      of this Warrant.

     

    (h) Escrow
      of Warrant Stock.
      If
      after any property becomes distributable pursuant to this Section 4 by reason
      of
      the taking of any record of the holders of Common Stock, but prior to the
      occurrence of the event for which such record is taken, and the Holder exercises
      this Warrant, any shares of Common Stock issuable upon exercise by reason of
      such adjustment shall be deemed the last shares of Common Stock for which this
      Warrant is exercised (notwithstanding any other provision to the contrary
      herein) and such shares or other property shall be held in escrow for the Holder
      by the Issuer to be issued to the Holder upon and to the extent that the event
      actually takes place, upon payment of the current Warrant Price. Notwithstanding
      any other provision to the contrary herein, if the event for which such record
      was taken fails to occur or is rescinded, then such escrowed shares shall be
      cancelled by the Issuer and escrowed property returned.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    5. Notice
      of Adjustments.
      Whenever the Warrant Price or Warrant Share Number shall be adjusted pursuant
      to
      Section 4 hereof (for purposes of this Section 5, each an “adjustment”),
      the
      Issuer shall cause its Chief Financial Officer to prepare and execute a
      certificate setting forth, in reasonable detail, the event requiring the
      adjustment, the amount of the adjustment, the method by which such adjustment
      was calculated (including a description of the basis on which the Board made
      any
      determination hereunder), and the Warrant Price and Warrant Share Number after
      giving effect to such adjustment, and shall cause copies of such certificate
      to
      be delivered to the Holder of this Warrant promptly after each adjustment.
      Any
      dispute between the Issuer and the Holder of this Warrant with respect to the
      matters set forth in such certificate may at the option of the Holder of this
      Warrant be submitted to a national or regional accounting firm reasonably
      acceptable to the Issuer and the Holder (the “Independent
      Appraiser”),
      provided
      that the
      Issuer shall have ten (10) days after receipt of notice from such Holder of
      its
      selection of such firm to object thereto, in which case such Holder shall select
      another such firm and the Issuer shall have no such right of objection. The
      Independent Appraiser selected by the Holder of this Warrant as provided in
      the
      preceding sentence shall be instructed to deliver a written opinion as to such
      matters to the Issuer and such Holder within thirty (30) days after submission
      to it of such dispute. Such opinion shall be final and binding on the parties
      hereto. The reasonable expenses of the Independent Appraiser in making such
      determination shall be paid by the Issuer, in the event the Holder's calculation
      was correct, or by the Holder, in the event the Issuer’s calculation was
      correct, or equally by the Issuer and the Holder in the event that neither
      the
      Issuer's or the Holder's calculation was correct.

     

    6. Fractional
      Shares.
      No
      fractional shares of Warrant Stock will be issued in connection with any
      exercise hereof, but in lieu of such fractional shares, the Issuer shall round
      the number of shares to be issued upon exercise up to the nearest whole number
      of shares.

     

    7. Ownership
      Cap and Exercise Restriction.
      Notwithstanding anything to the contrary set forth in this Warrant, at no time
      may a Holder of this Warrant exercise this Warrant if the number of shares
      of
      Common Stock to be issued pursuant to such exercise would exceed, when
      aggregated with all other shares of Common Stock beneficially owned by such
      Holder at such time, the number of shares of Common Stock which would result
      in
      such Holder beneficially owning (as determined in accordance with Section 13(d)
      of the Exchange Act and the rules thereunder) in excess of 4.99% of the then
      issued and outstanding shares of Common Stock; provided,
      however,
      that
      upon a holder of this Warrant providing the Issuer with sixty-one (61) days
      notice (pursuant to Section 13 hereof) (the “Waiver
      Notice”)
      that
      such Holder would like to waive this Section 7 with regard to any or all shares
      of Common Stock issuable upon exercise of this Warrant, this Section 7 will
      be
      of no force or effect with regard to all or a portion of the Warrant referenced
      in the Waiver Notice; provided,
      further,
      that
      this provision shall be of no further force or effect during the sixty-one
      (61)
      days immediately preceding the expiration of the term of this
      Warrant.

     

    8. Registration
      Rights.
      The
      Holder of this Warrant is entitled to the benefit of certain registration rights
      with respect to the shares of Warrant Stock issuable upon the exercise of this
      Warrant pursuant to that certain Registration Rights Agreement, of even date
      herewith, by and among the Company and Persons listed on Schedule I thereto
      (the
“Registration
      Rights Agreement”)
      and
      the registration rights with respect to the shares of Warrant Stock issuable
      upon the exercise of this Warrant by any subsequent Holder may only be assigned
      in accordance with the terms and provisions of the Registrations Rights
      Agreement.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

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

     

    “Additional
      Shares of Common Stock”
means
      all shares of Common Stock issued by the Issuer after the Original Issue Date,
      and all shares of Other Common, if any, issued by the Issuer after the Original
      Issue Date, except: (i) securities issued pursuant to a bona fide firm
      underwritten public offering of the Company’s securities, provided such
      underwritten public offering has been approved in advance by the holders of
      more
      than fifty percent (50%) of the then outstanding shares of Series A (the
“Majority
      Holders”),
      (ii)
      securities issued (other than for cash) in connection with a strategic merger,
      acquisition, or consolidation, provided that the issuance of such securities
      in
      connection with such strategic merger, acquisition, or consolidation has been
      approved in advance by the Majority Holders, (iii) securities issued pursuant
      to
      the conversion or exercise of convertible or exercisable securities issued
      or
      outstanding on or prior to the date of the Purchase Agreement or issued pursuant
      to the Purchase Agreement (so long as the conversion or exercise price in such
      securities are not amended to lower such price and/or adversely affect the
      Holders), (iv) the Warrant Stock, (v) securities issued in connection with
      bona
      fide strategic license agreements or other partnering arrangements so long
      as
      such issuances are not for the purpose of raising capital and provided that
      the
      issuance of such securities in connection with such bona fide strategic license
      agreements or other partnering arrangements has been approved in advance by
      the
      Majority Holders, (vi) Common Stock issued or the issuance or grants of options
      to purchase Common Stock pursuant to the Issuer’s equity incentive plans
      outstanding as they exist on the date of the Purchase Agreement, (vii) the
      issuance or grants of options to purchase Common Stock to employees, officers
      or
      directors of the Issuer pursuant to any equity incentive plan duly adopted
      by
      the Board or a committee thereof established for such purpose so long as such
      issuances in the aggregate do not exceed ten percent (10)% of the issued and
      outstanding shares of Common Stock as of the Original Issue Date and the
      specified price at which the options may be exercised is equal to or greater
      than the Per Share Market Value as of the date of such grant, and (viii) any
      warrants, shares of Common Stock or other securities issued to a placement
      agent
      and its designees for the transactions contemplated by the Purchase Agreement
      or
      in any other sales of the Issuer’s securities and any securities issued in
      connection with any financial advisory agreements of the Issuer and the shares
      of Common Stock issued upon exercise of any such warrants or conversions of
      any
      such other securities.

     

    “Articles
      of Incorporation”
means
      the Articles of Incorporation of the Issuer as in effect on the Original Issue
      Date, and as hereafter from time to time amended, modified, supplemented or
      restated in accordance with the terms hereof and thereof and pursuant to
      applicable law.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    “Board”
shall
      mean the Board of Directors of the Issuer.

     

    “Capital
      Stock”
means
      and includes (i) any and all shares, interests, participations or other
      equivalents of or interests in (however designated) corporate stock, including,
      without limitation, shares of preferred or preference stock, (ii) all
      partnership interests (whether general or limited) in any Person which is a
      partnership, (iii) all membership interests or limited liability company
      interests in any limited liability company, and (iv) all equity or ownership
      interests in any Person of any other type.

     

    “Common
      Stock”
means
      the Common Stock, $0.001 par value per share, of the Issuer and any other
      Capital Stock into which such stock may hereafter be changed.

     

    “Common
      Stock Equivalent”
means
      any Convertible Security or warrant, option or other right to subscribe for
      or
      purchase any Additional Shares of Common Stock or any Convertible
      Security.

     

    “Convertible
      Securities”
means
      evidences of Indebtedness, shares of Capital Stock or other Securities which
      are
      or may be at any time convertible into or exchangeable for Additional Shares
      of
      Common Stock. The term “Convertible Security” means one of the Convertible
      Securities.

     

    “Governmental
      Authority”
means
      any governmental, regulatory or self-regulatory entity, department, body,
      official, authority, commission, board, agency or instrumentality, whether
      federal, state or local, and whether domestic or foreign.

     

    “Holders”
mean
      the Persons who shall from time to time own any Warrant. The term “Holder” means
      one of the Holders.

     

    “Independent
      Appraiser”
means
      a
      nationally recognized or major regional investment banking firm or firm of
      independent certified public accountants of recognized standing (which may
      be
      the firm that regularly examines the financial statements of the Issuer) that
      is
      regularly engaged in the business of appraising the Capital Stock or assets
      of
      corporations or other entities as going concerns, and which is not affiliated
      with either the Issuer or the Holder of any Warrant.

     

    “Issuer”
means
      Victory Divide Mining Company, a Nevada corporation, and its
      successors.

     

    “Majority
      Holders”
means
      at any time the Holders of Warrants exercisable for a majority of the shares
      of
      Warrant Stock issuable under the Warrants at the time outstanding.

     

    “Original
      Issue Date”
means
      October 3, 2007.

     

    “OTC
      Bulletin Board”
means
      the over-the-counter electronic bulletin board.

     

    “Other
      Common”
means
      any other Capital Stock of the Issuer of any class which shall be authorized
      at
      any time after the date of this Warrant (other than Common Stock) and which
      shall have the right to participate in the distribution of earnings and assets
      of the Issuer without limitation as to amount.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    “Outstanding
      Common Stock”
means,
      at any given time, the aggregate amount of outstanding shares of Common Stock,
      assuming full exercise, conversion or exchange (as applicable) of all options,
      warrants and other Securities which are convertible into or exercisable or
      exchangeable for, and any right to subscribe for, shares of Common Stock that
      are outstanding at such time.

     

    “Person”
means
      an individual, corporation, limited liability company, partnership, joint stock
      company, trust, unincorporated organization, joint venture, Governmental
      Authority or other entity of whatever nature.

     

    “Per
      Share Market Value”
means
      on any particular date (a) the last closing price per share of the Common Stock
      on such date on the OTC Bulletin Board or another registered national stock
      exchange on which the Common Stock is then listed, or if there is no closing
      price on such date, then the closing bid price on such date, or if there is
      no
      closing bid price on such date, then the closing price on such exchange or
      quotation system on the date nearest preceding such date, or (b) if the Common
      Stock is not listed then on the OTC Bulletin Board or any registered national
      stock exchange, the last closing price for a share of Common Stock in the
      over-the-counter market, as reported by the OTC Bulletin Board or in the
      National Quotation Bureau Incorporated or similar organization or agency
      succeeding to its functions of reporting prices) at the close of business on
      such date, or if there is no closing price on such date, then the closing bid
      price on such date, or (c) if the Common Stock is not then reported by the
      OTC
      Bulletin Board or the National Quotation Bureau Incorporated (or similar
      organization or agency succeeding to its functions of reporting prices), then
      the average of the “Pink Sheet” quotes for the five (5) Trading Days preceding
      such date of determination, or (d) if the Common Stock is not then publicly
      traded the fair market value of a share of Common Stock as determined by an
      Independent Appraiser selected in good faith by the Majority Holders;
provided,
      however,
      that
      the Issuer, after receipt of the determination by such Independent Appraiser,
      shall have the right to select an additional Independent Appraiser, in which
      case, the fair market value shall be equal to the average of the determinations
      by each such Independent Appraiser; and provided,
      further,
      that
      all determinations of the Per Share Market Value shall be appropriately adjusted
      for any stock dividends, stock splits or other similar transactions during
      such
      period. The determination of fair market value by an Independent Appraiser
      shall
      be based upon the fair market value of the Issuer determined on a going concern
      basis as between a willing buyer and a willing seller and taking into account
      all relevant factors determinative of value, and shall be final and binding
      on
      all parties. In determining the fair market value of any shares of Common Stock,
      no consideration shall be given to any restrictions on transfer of the Common
      Stock imposed by agreement or by federal or state securities laws, or to the
      existence or absence of, or any limitations on, voting rights.

     

    “Purchase
      Agreement”
means
      the Series A Convertible Preferred Stock Purchase Agreement dated as of October
      3, 2007, among the Issuer and the Purchasers.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    “Purchasers”
means
      the purchasers of the Series A Convertible Preferred Stock and the Warrants
      issued by the Issuer pursuant to the Purchase Agreement.

     

    “Securities”
means
      any debt or equity securities of the Issuer, whether now or hereafter
      authorized, any instrument convertible into or exchangeable for Securities
      or a
      Security, and any option, warrant or other right to purchase or acquire any
      Security. “Security” means one of the Securities.

     

    “Securities
      Act”
means
      the Securities Act of 1933, as amended, or any similar federal statute then
      in
      effect.

     

    “Subsidiary”
means
      any corporation at least 50% of whose outstanding Voting Stock shall at the
      time
      be owned directly or indirectly by the Issuer or by one or more of its
      Subsidiaries, or by the Issuer and one or more of its Subsidiaries.

     

    “Term”
has
      the
      meaning specified in Section 1 hereof.

     

    “Trading
      Day”
means
      (a) a day on which the Common Stock is traded on the OTC Bulletin Board, or
      (b)
      if the Common Stock is not traded on the OTC Bulletin Board, a day on which
      the
      Common Stock is quoted in the over-the-counter market as reported by the
      National Quotation Bureau Incorporated (or any similar organization or agency
      succeeding its functions of reporting prices); provided,
      however,
      that in
      the event that the Common Stock is not listed or quoted as set forth in (a)
      or
      (b) hereof, then Trading Day shall mean any day except Saturday, Sunday and
      any
      day which shall be a legal holiday or a day on which banking institutions in
      the
      State of New York are authorized or required by law or other government action
      to close.

     

    “Trading
      Market”
means
      the following markets or exchanges on which the Common Stock is listed or quoted
      for trading on the date in question: the Nasdaq Capital Market, the Nasdaq
      Global Market, the Nasdaq Global Select Market, the New York Stock Exchange
      or
      the OTC Bulletin Board.

     

    “Voting
      Stock”
means,
      as applied to the Capital Stock of any corporation, Capital Stock of any class
      or classes (however designated) having ordinary voting power for the election
      of
      a majority of the members of the Board of Directors (or other governing body)
      of
      such corporation, other than Capital Stock having such power only by reason
      of
      the happening of a contingency.

     

    “VWAP”
means,
      for any date, the price determined by the first of the following clauses that
      applies: (a) if the Common Stock is then listed or quoted on a Trading Market,
      the daily volume weighted average price of the Common Stock for such date (or
      the nearest preceding date) on the Trading Market on which the Common Stock
      is
      then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day
      from
      9:30 a.m. New York City time to 4:02 p.m. New York City time); (b) if the OTC
      Bulletin Board is not a Trading Market, the volume weighted average price of
      the
      Common Stock for such date (or the nearest preceding date) on the OTC Bulletin
      Board; (c) if the Common Stock is not then listed or quoted on the OTC Bulletin
      Board and if prices for the Common Stock are then reported in the "Pink Sheets"
      published by Pink Sheets, LLC (or a similar organization or agency succeeding
      to
      its functions of reporting prices), the most recent bid price per share of
      the
      Common Stock so reported; or (d) in all other cases, the fair market value
      of a
      share of Common Stock as determined by an independent appraiser selected in
      good
      faith by the Holders of a majority in interest of the Warrants then outstanding
      and reasonably acceptable to the Company, the fees and expenses of which shall
      be paid by the Company.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    “Warrants”
means
      the Warrants issued and sold pursuant to the Purchase Agreement, including,
      without limitation, this Warrant, and any other warrants of like tenor issued
      in
      substitution or exchange for any thereof pursuant to the provisions of Section
      2(c), 2(d) or 2(e) hereof or of any of such other Warrants.

     

    “Warrant
      Price”
      initially means $2.75, as such price may be adjusted from time to time as shall
      result from the adjustments specified in this Warrant, including Section 4
      hereto.

     

    “Warrant
      Share Number”
means
      at any time the aggregate number of shares of Warrant Stock which may at such
      time be purchased upon exercise of this Warrant, after giving effect to all
      prior adjustments and increases to such number made or required to be made
      under
      the terms hereof.

     

    “Warrant
      Stock”
means
      Common Stock issuable upon exercise of any Warrant or Warrants or otherwise
      issuable pursuant to any Warrant or Warrants.

     

    10. Other
      Notices.
      In case
      at any time:

     

    (a) the
      Issuer shall make any distributions to the holders of Common Stock;
      or

     

    (b) the
      Issuer shall authorize the granting to all holders of its Common Stock of rights
      to subscribe for or purchase any shares of Capital Stock of any class or other
      rights; or

     

    (c) there
      shall be any reclassification of the Capital Stock of the Issuer;
      or

     

    (d) there
      shall be any capital reorganization by the Issuer; or

     

    (e) there
      shall be any (i) consolidation or merger involving the Issuer or (ii) sale,
      transfer or other disposition of all or substantially all of the Issuer’s
      property, assets or business (except a merger or other reorganization in which
      the Issuer shall be the surviving corporation and its shares of Capital Stock
      shall continue to be outstanding and unchanged and except a consolidation,
      merger, sale, transfer or other disposition involving a wholly-owned
      Subsidiary); or

     

    (f) there
      shall be a voluntary or involuntary dissolution, liquidation or winding-up
      of
      the Issuer or any partial liquidation of the Issuer or distribution to holders
      of Common Stock;

     

    then,
      in
      each of such cases, the Issuer shall give written notice to the Holder of the
      date on which (i) the books of the Issuer shall close or a record shall be
      taken
      for such dividend, distribution or subscription rights or (ii) such
      reorganization, reclassification, consolidation, merger, disposition,
      dissolution, liquidation or winding-up, as the case may be, shall take place.
      Such notice also shall specify the date as of which the holders of Common Stock
      of record shall participate in such dividend, distribution or subscription
      rights, or shall be entitled to exchange their certificates for Common Stock
      for
      securities or other property deliverable upon such reorganization,
      reclassification, consolidation, merger, disposition, dissolution, liquidation
      or winding-up, as the case may be. Such notice shall be given at least twenty
      (20) days prior to the action in question and not less than ten (10) days prior
      to the record date or the date on which the Issuer’s transfer books are closed
      in respect thereto. This Warrant entitles the Holder to receive copies of all
      financial and other information distributed or required to be distributed to
      the
      holders of the Common Stock.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    11. Amendment
      and Waiver.
      Any
      term, covenant, agreement or condition in this Warrant may be amended, or
      compliance therewith may be waived (either generally or in a particular instance
      and either retroactively or prospectively), by a written instrument or written
      instruments executed by the Issuer and the Majority Holders; provided,
      however,
      that no
      such amendment or waiver shall reduce the Warrant Share Number, increase the
      Warrant Price, shorten the period during which this Warrant may be exercised
      or
      modify any provision of this Section 11 without the consent of the Holder of
      this Warrant. No consideration shall be offered or paid to any person to amend
      or consent to a waiver or modification of any provision of this Warrant unless
      the same consideration is also offered to all holders of the
      Warrants.

     

    12. Governing
      Law; Jurisdiction.
      This
      Warrant shall be governed by and construed in accordance with the internal
      laws
      of the State of New York, without giving effect to any of the conflicts of
      law
      principles which would result in the application of the substantive law of
      another jurisdiction. This Warrant shall not be interpreted or construed with
      any presumption against the party causing this Warrant to be drafted. The Issuer
      and the Holder agree that venue for any dispute arising under this Warrant
      will
      lie exclusively in the state or federal courts located in New York County,
      New
      York, and the parties irrevocably waive any right to raise forum non conveniens
      or any other argument that New York is not the proper venue. The Issuer and
      the
      Holder irrevocably consent to personal jurisdiction in the state and federal
      courts of the state of New York. The Issuer and the Holder consent to process
      being served in any such suit, action or proceeding by mailing a copy thereof
      to
      such party at the address in effect for notices to it under this Warrant and
      agree that such service shall constitute good and sufficient service of process
      and notice thereof. Nothing in this Section 12 shall affect or limit any right
      to serve process in any other manner permitted by law. The Issuer and the Holder
      hereby agree that the prevailing party in any suit, action or proceeding arising
      out of or relating to this Warrant or the Purchase Agreement, shall be entitled
      to reimbursement for reasonable legal fees from the non-prevailing party. The
      parties hereby waive all rights to a trial by jury.

     

    13. Notices.
      All
      notices, demands, consents, requests, instructions and other communications
      to
      be given or delivered or permitted under or by reason of the provisions of
      this
      Agreement or in connection with the transactions contemplated hereby shall
      be in
      writing and shall be deemed to be delivered and received by the intended
      recipient as follows: (i) if personally delivered, on the business day of such
      delivery (as evidenced by the receipt of the personal delivery service), (ii)
      if
      mailed certified or registered mail return receipt requested, two (2) business
      days after being mailed, (iii) if delivered by overnight courier (with all
      charges having been prepaid), on the business day of such delivery (as evidenced
      by the receipt of the overnight courier service of recognized standing), or
      (iv)
      if delivered by facsimile transmission, on the business day of such delivery
      if
      sent by 6:00 p.m. in the time zone of the recipient, or if sent after that
      time,
      on the next succeeding business day (as evidenced by the printed confirmation
      of
      delivery generated by the sending party’s telecopier machine). If any notice,
      demand, consent, request, instruction or other communication cannot be delivered
      because of a changed address of which no notice was given (in accordance with
      this Section 13), or the refusal to accept same, the notice, demand, consent,
      request, instruction or other communication shall be deemed received on the
      second business day the notice is sent (as evidenced by a sworn affidavit of
      the
      sender). All such notices, demands, consents, requests, instructions and other
      communications will be sent to the following addresses or facsimile numbers
      as
      applicable.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    

    
      	
              If
                to the Issuer: 

               

            	
              Victory
                Divide Mining Company

              c/o
                Heilongjiang Yanglin Soybean Group

              No.
                99 Fanrong Street 

              Jixian
                Town Heilongjiang 

              People’s
                Republic of China 155900  

              Tel:
                86-469-467-8077

              Fax:
                86-469-469-3000 

              Email:kingbode1@163.com

            
	 	 
	
              with
                copies (which copies

              shall
                not constitute notice)

              to:

            	
              Guzov
                Ofsink, LLC

              600
                Madison Avenue, 14th Floor

              New
                York, New York 10022

              Attention:
                Darren Ofsink

              Tel.
                No.: (212) 371-8008, ext. 127

              Fax
                No.: (212) 688-7273

            
	 	 
	
              If
                to any Holder:

            	
              At
                the address of such Holder set forth on Exhibit A to this Agreement,
                with
                copies to Holder’s counsel as set forth on Exhibit A or as specified in
                writing by such Holder with copies to:

            
	 	 
	
              with
                copies (which copies

              shall
                not constitute notice)

              to:

            	
              Loeb
                & Loeb LLP

              345
                Park Avenue

              New
                York, NY 10154

              Attn:
                Mitchell Nussbaum

              Facsimile:
                212-407-4000 

            

    

     

    Any
      party
      hereto may from time to time change its address for notices by giving at least
      ten (10) days written notice of such changed address to the other party
      hereto.

     

    14. Warrant
      Agent.
      The
      Issuer may, by written notice to the Holder of this Warrant, appoint an agent
      having an office in New York, New York for the purpose of issuing shares of
      Warrant Stock on the exercise of this Warrant pursuant to subsection (b) of
      Section 2 hereof, exchanging this Warrant pursuant to subsection (d) of Section
      2 hereof or replacing this Warrant pursuant to subsection (d) of Section 3
      hereof, or any of the foregoing, and thereafter any such issuance, exchange
      or
      replacement, as the case may be, shall be made at such office by such
      agent.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    15. Remedies.
      The
      Issuer stipulates that the remedies at law of the Holder of this Warrant in
      the
      event of any default or threatened default by the Issuer in the performance
      of
      or compliance with any of the terms of this Warrant are not and will not be
      adequate and that, 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
      hereof or otherwise.

     

    16. Successors
      and Assigns.
      This
      Warrant and the rights evidenced hereby shall inure to the benefit of and be
      binding upon the successors and assigns of the Issuer, the Holder hereof and
      (to
      the extent provided herein) the Holders of Warrant Stock issued pursuant hereto,
      and shall be enforceable by any such Holder or Holder of Warrant
      Stock.

     

    17. Modification
      and Severability.
      If, in
      any action before any court or agency legally empowered to enforce any provision
      contained herein, any provision hereof is found to be unenforceable, then such
      provision shall be deemed modified to the extent necessary to make it
      enforceable by such court or agency. If any such provision is not enforceable
      as
      set forth in the preceding sentence, the unenforceability of such provision
      shall not affect the other provisions of this Warrant, but this Warrant shall
      be
      construed as if such unenforceable provision had never been contained
      herein.

     

    18. Headings.
      The
      headings of the Sections of this Warrant are for convenience of reference only
      and shall not, for any purpose, be deemed a part of this Warrant.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    IN
      WITNESS WHEREOF, the Issuer has executed this Series A Warrant as of the day
      and
      year first above written.

     

    VICTORY
      DIVIDE MINING COMPANY

     

    By:
      __/s/_Shulin
      Liu________

    Name:
      Shulin Liu

    Title:
      Chief Executive Officer 

     

    

     

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    EXERCISE
      FORM

    SERIES
      A
      WARRANT

     

    VICTORY
      DIVIDE MINING COMPANY

     

    The
      undersigned _______________, pursuant to the provisions of the within Warrant,
      hereby elects to purchase _____ shares of Common Stock of
      ________________________________ covered by the within Warrant.

     

    
      	
              Dated:
                

            	 	 	Signature	 
	 	 	 	 	 
	 	 	 	
              Address

            	 
	 	 	 	 	 
	 	 	 	 	 

    

     

    Number
      of
      shares of Common Stock beneficially owned or deemed beneficially owned by the
      Holder on the date of Exercise: _________________________

     

    The
      undersigned is an “accredited investor” as defined in Regulation D under the
      Securities Act of 1933, as amended.

     

    The
      undersigned intends that payment of the Warrant Price shall be made as (check
      one):

     

    Cash
      Exercise_______

     

    Cashless
      Exercise_______

     

    If
      the
      Holder has elected a Cash Exercise, the Holder shall pay the sum of $________
      by
      certified or official bank check (or via wire transfer) to the Issuer in
      accordance with the terms of the Warrant.

     

    If
      the
      Holder has elected a Cashless Exercise, a certificate shall be issued to the
      Holder for the number of shares equal to the whole number portion of the product
      of the calculation set forth below, which is ___________. The Company shall
      pay
      a cash adjustment in respect of the fractional portion of the product of the
      calculation set forth below in an amount equal to the product of the fractional
      portion of such product and the Per Share Market Value on the date of exercise,
      which product is ____________.

     

    X
      = Y -
(A)(Y)

    B

     

    Where:

     

    The
      number of shares of Common Stock to be issued to the Holder
      __________________(“X”).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    The
      number of shares of Common Stock purchasable upon exercise of all of the Warrant
      or, if only a portion of the Warrant is being exercised, the portion of the
      Warrant being exercised ___________________________ (“Y”).

     

    The
      Warrant Price ______________ (“A”).

     

    The
      Per
      Share Market Value of one share of Common Stock _______________________
      (“B”).

     

    ASSIGNMENT

     

    FOR
      VALUE
      RECEIVED, _________________ hereby sells, assigns and transfers unto
      __________________ the within Warrant and all rights evidenced thereby and
      does
      irrevocably constitute and appoint _____________, attorney, to transfer the
      said
      Warrant on the books of the within named corporation.

    
         

      
        	
                Dated:
                  

              	 	 	Signature	 
	 	 	 	 	 
	 	 	 	
                Address

              	 
	 	 	 	 	 
	 	 	 	 	 

      

         
PARTIAL ASSIGNMENT

     

    FOR
      VALUE
      RECEIVED, _________________ hereby sells, assigns and transfers unto
      __________________ the right to purchase _________ shares of Warrant Stock
      evidenced by the within Warrant together with all rights therein, and does
      irrevocably constitute and appoint ___________________, attorney, to transfer
      that part of the said Warrant on the books of the within named
      corporation.

    
       

      
        	
                Dated:
                  

              	 	 	Signature	 
	 	 	 	 	 
	 	 	 	
                Address

              	 
	 	 	 	 	 
	 	 	 	 	 

      

       

    

    FOR
      USE
      BY THE ISSUER ONLY:

     

    This
      Warrant No. W-___ canceled (or transferred or exchanged) this _____ day of
      ___________, _____, shares of Common Stock issued therefor in the name of
      _______________, Warrant No. W-_____ issued for ____ shares of Common Stock
      in
      the name of _______________.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00130-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00130-of-00352.parquet"}]]