Document:

ARCI Test S1A5

Exhibit 4.3

NEITHER THIS WARRANT CERTIFICATE NOR THE WARRANTS REPRESENTED HEREBY NOR ANY SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE OF SUCH WARRANTS, NOR ANY INTEREST IN OR RIGHTS UNDER SAME, HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE LAWS OF ANY STATE, AND NEITHER THIS WARRANT CERTIFICATE NOR THE WARRANTS REPRESENTED HEREBY NOR ANY SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE OF SUCH WARRANTS, NOR ANY INTEREST IN OR RIGHTS UNDER SAME, MAY BE SOLD OR OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE. 

W-2010-B-___ 

AMERICAN RESTAURANT CONCEPTS, INC. 

COMMON STOCK PURCHASE WARRANT – CLASS B

American Restaurant Concepts, Inc., a Florida corporation (the “Company”), for value received and subject to the terms set forth below hereby grants to _________________________________________, or its registered successors and assigns (the “Holder”), the right to purchase from the Company at any time or from time to time until the date and time permitted under Section 2.1 below, ________________________ fully paid and nonassessable shares of the Common Stock, par value $0.01 per share, at the purchase price of fifty cents ($1.25) per share (the “Exercise Price”). The Exercise Price and the number and character of such shares of Common Stock purchasable pursuant to the rights granted under this Warrant are subject to adjustment as provided herein. 

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

(a)

“Common Stock” means the Company’s common stock, par value $0.01 per share, and stock of any other class of securities into which such securities may hereafter have been reclassified or changed into, including any stock (other than Common Stock) and other securities of the Company or any other person (corporate or other) which the Holder of this Warrant at any time shall be entitled to receive, or shall have received, upon the exercise of this Warrant, in lieu of or in addition to Common Stock, or which at any time shall be issuable or shall have been issued in exchange for or in replacement of Common Stock pursuant to Section 3.2 hereof or otherwise..

(b)

“Market Value” 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 (other than the OTC Bulletin Board or Pink Sheets), 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 Financial L.P. (based on a trading day from 9:30 a.m. Eastern Time to 4:00 p.m. Eastern Time); (b) if the Common Stock is then listed or quoted on the OTC Bulletin Board, the average of the high and 

low 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 a Trading Market other than the Pink Sheets (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) if the Common Stock is not then listed on a Trading Market, then the fair market value of the Common Stock as determined by the board of directors of the Company.

(c)

“Termination Date” means December 31, 2012.

(d)

“This Warrant” means, collectively, this Warrant and all other stock purchase warrants issued in exchange therefor or replacement thereof. 

(e)

“Trading Market” means any one of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the Nasdaq SmallCap Market, the NYSE Alternext US, the New York Stock Exchange, the Nasdaq National Market, the OTC Bulletin Board or the Pink Sheets.

2. Exercise. 

2.1 Exercise Period. The Holder may exercise this Warrant at any time on or before the close of business in Jacksonville, Florida on the Termination Date (the “Exercise Period”). 

2.2 Exercise Procedure. 

(a) This Warrant will be deemed to have been exercised at such time as the Company has received all of the following items (the “Exercise Date”): 

(i) a completed Subscription Agreement as described in Section 2.4 hereof, executed by the person exercising all or part of the purchase rights represented by this Warrant (the “Purchaser”); 

(ii) this Warrant; 

(iii) if this Warrant is not registered in the name of the Purchaser, an Assignment or Assignments in the form set forth in Exhibit B hereto, evidencing the assignment of this Warrant to the Purchaser together with any documentation required pursuant to Section 8(a) hereof; and 

(iv) a check payable to the order of the Company in an amount equal to the product of the Exercise Price multiplied by the number of shares of Common Stock being purchased upon such exercise.

(b) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within ten (10) days after the Exercise Date, the Company at its expense will cause to be issued in the name of and delivered to the Purchaser, or as the Purchaser (upon payment by the Purchaser of any applicable transfer taxes) may direct, a certificate or certificates for the number of fully paid and non-assessable shares of Common Stock to which the Purchaser shall be entitled upon such exercise, together with any other stock or other securities and property (including cash, where applicable) to which the Purchaser is entitled upon exercise. 

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(c) Unless this Warrant has expired or all of the purchase rights represented hereby have been exercised, the Company at its expense will, within ten (10) days after the Exercise Date, issue and deliver to or upon the order of the Purchaser a new Warrant or Warrants of like tenor, in the name of the Purchaser or as the Purchaser (upon payment by the Purchaser of any applicable transfer taxes) may request, calling in the aggregate on the face or faces thereof for the number of shares of Common Stock remaining issuable under this Warrant. 

(d) The Common Stock issuable upon the exercise of this Warrant will be deemed to have been issued to the Purchaser on the Exercise Date, and the Purchaser will be deemed for all purposes to have become the record holder of such Common Stock on the Exercise Date. 

(e) The issuance of certificates for shares of Common Stock upon exercise of this Warrant will be made without charge to the Holder or the Purchaser for any issuance tax in respect thereof or any other cost incurred by the Company in connection with such exercise and the related issuance of shares of Common Stock. 

(f) The holder represents and warrants that at the time of any exercise of this warrant the holder is an “accredited investor,” as such term is defined in Rule 501 promulgated under the Securities Act and acknowledges and agrees that the Company may, in its sole discretion, (i) require, as a condition to the exercise of this Warrant, that the holder provide such written evidence that such holder is an accredited investor as the time of exercise, and (ii) decline to issue the shares of Common Stock issuable upon such exercise if the Company is not satisfied that this warrant may be exercised by the holder pursuant to a valid registration exemption from the Securities Act and any applicable state securities law. 

2.3 Acknowledgement of Continuing Obligations. The Company will, at the time of the exercise of this Warrant, upon the request of the Purchaser, acknowledge in writing its continuing obligation to afford to the Purchaser any rights to which the Purchaser shall continue to be entitled after such exercise in accordance with the provisions of this Warrant, provided that if the Purchaser shall fail to make any such request, such failure shall not affect the continuing obligation of the Company to afford to the Purchaser any such rights. 

2.4 Subscription Agreement. The Subscription Agreement will be substantially in the form set forth in Exhibit A hereto, except that if the shares of Common Stock issuable upon exercise of this Warrant are not to be issued in the name of the Purchaser, the Subscription Agreement will also state the name of the person to whom the certificates for the shares of Common Stock are to be issued, and if the number of shares of Common Stock to be issued does not include all the shares of Common Stock issuable hereunder, it will also state the name of the person to whom a new Warrant for the unexercised portion of the rights hereunder is to be delivered. 

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2.5 Fractional Shares. If a fractional share of Common Stock would, but for the provisions of Section 2.1 hereof, be issuable upon exercise of the rights represented by this Warrant, the Company will, within ten (10) days after the Exercise Date, deliver to the Purchaser a check payable to the Purchaser in lieu of such fractional share, in an amount equal to the Market Value of such fractional share as of the close of business on the Exercise Date.

3. Adjustments. 

3.1 Adjustments for Stock Splits, Etc. If the Company shall at any time after the issue date subdivide its outstanding Common Stock, by split-up or otherwise, or combine its outstanding Common Stock, or issue additional shares of its capital stock in payment of a stock dividend in respect of its Common Stock, the number of shares issuable on the exercise of the unexercised portion of this Warrant shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination, and the Exercise Price then applicable to shares covered by the unexercised portion of this Warrant shall forthwith be proportionately decreased in the case of a subdivision or stock dividend, or proportionately increased in the case of combination. 

3.2 Adjustment for Reclassification, Reorganization, etc. In case of any reclassification, capital reorganization, or change of the outstanding Common Stock (other than as a result of a subdivision, combination or stock dividend), or in the case of any consolidation of the Company with, or merger of the Company into, another person (other than a consolidation or merger in which the Company is the continuing corporation and which does not result in any reclassification or change of the outstanding Common Stock of the Company), or in case of any sale or conveyance to one or more persons of the property of the Company as an entirety or substantially as an entirety at any time prior to the expiration of this Warrant, then, as a condition of such reclassification, reorganization, change, consolidation, merger, sale or conveyance, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the Holder of this Warrant, so that the Holder of this Warrant shall have the right at any time prior to the expiration of this Warrant to purchase, at a total price not to exceed that payable upon the exercise of the unexercised portion of this Warrant, the kind and amount of shares of stock and other securities and property receivable upon such reclassification, reorganization, change, consolidation, merger, sale or conveyance by a holder of the number of shares of Common Stock of the Company as to which this Warrant was exercisable immediately prior to such reclassification, reorganization, change, consolidation, merger, sale or conveyance, and in any such case appropriate provision shall be made with respect to the rights and interests of the Holder of this Warrant to the end that the provisions hereof (including, without limitation, provisions for the adjustment of the Exercise Price and of the number of shares purchasable upon exercise of this Warrant) shall thereafter be applicable in relation to any shares of stock, and other securities and property, thereafter deliverable upon exercise hereof. If, as a consequence of any such transaction, solely cash, and no securities or other property of any kind, is deliverable upon exercise of this Warrant, then, in such event, the Company may terminate this Warrant by giving the Holder hereof written notice thereof. Such notice shall specify the date (at least thirty (30) days subsequent to the date on which notice is given) on which, at 3:00 P.M., Jacksonville, Florida time, this Warrant shall terminate. Notwithstanding any such notice, this Warrant shall remain exercisable, and otherwise in full force and effect, until such time of termination. 

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3.3 Certificate of Adjustment. Whenever the Exercise Price or the number of shares issuable hereunder is adjusted, as herein provided, the Company shall promptly deliver to the registered Holder of this Warrant a certificate of the Treasurer of the Company, which certificate shall state (i) the Exercise Price and the number of shares of Common Stock issuable hereunder after such adjustment, (ii) the facts requiring such adjustment, and (iii) the method of calculation for such adjustment and increase or decrease. 

3.4 Small Adjustments. No adjustment in the Exercise Price shall be required unless such adjustment would require an increase or decrease in the Exercise Price of at least one percent; provided, however, that any adjustments which by reason of this Section 3.4 are not required to be made immediately shall be carried forward and taken into account at the time of exercise of this Warrant or any subsequent adjustment in the Exercise Price which, singly or in combination with any adjustment carried forward, is required to be made under Sections 3.1 or 3.2. 

4. Reservation of Stock, etc., Issuable on Exercise of Warrant. The Company will at all times reserve and keep available, solely for issuance and delivery upon the exercise of this Warrant, all shares of Common Stock from time to time issuable upon the exercise of this Warrant. 

5. Disposition of This Warrant, Common Stock, Etc. 

(a) The Holder of this Warrant and any transferee hereof or of the Common Stock with respect to which this Warrant may be exercisable, by their acceptance hereof, hereby understand and agree that this Warrant and the Common Stock with respect to which this Warrant may be exercisable have not been registered under the Securities Act, and may not be sold, pledged, hypothecated, donated, or otherwise transferred (whether or not for consideration) without an effective registration statement under the Act or an opinion of counsel satisfactory to the Company and/or submission to the Company of such other evidence as may be satisfactory to counsel to the Company, in each such case, to the effect that any such transfer shall not be in violation of the Act. It shall be a condition to the transfer of this Warrant that any transferee thereof deliver to the Company its written agreement to accept and be bound by all of the terms and conditions of this Warrant. 

(b) Except to the extent the resale of the shares of Common Stock issuable upon exercise hereof are registered for resale, or may be sold to the public pursuant to Rule 144(b)(1) under the Securities Act, the certificates of the Company that will evidence the shares of Common Stock with respect to which this Warrant may be exercisable will be imprinted with a conspicuous legend in substantially the following form: 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT BE SOLD, PLEDGED, HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR CONSIDERATION) BY THE HOLDER WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND/OR SUBMISSION TO THE COMPANY OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO COUNSEL TO THE COMPANY, IN EACH SUCH CASE, TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE ACT.”

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The Company has not agreed to register any of the Holder’s shares of Common Stock of the Company with respect to which this Warrant may be exercisable for distribution in accordance with the provisions of the Securities Act, and the Company has not agreed to comply with any exemption from registration under the Act for the resale of the Holder’s shares of Common Stock with respect to which this Warrant may be exercised. Hence, it is the understanding of the Holder of this Warrant that by virtue of the provisions of certain rules respecting “restricted securities” promulgated by the SEC, the shares of Common Stock of the Company with respect to which this Warrant may be exercisable may be required to be held indefinitely, unless and until registered under the Securities Act, unless an exemption from such registration is available, in which case the Holder may still be limited as to the number of shares of Common Stock of the Company with respect to which this Warrant may be exercised that may be sold from time to time. 

6. Rights and Obligations of Warrant Holder. The Holder of this Warrant shall not, by virtue hereof, be entitled to any voting rights or other rights as a stockholder of the Company. No provision of this Warrant, in the absence of affirmative actions by the Holder to purchase Common Stock of the Company by exercising this Warrant, and no enumeration in this Warrant of the rights or privileges of the Holder, will give rise to any liability of such Holder for the Exercise Price of Common Stock acquirable by exercise hereof or as a stockholder of the Company. 

7. Transfer of Warrants. Subject to compliance with the restrictions on transfer applicable to this Warrant referred to in Section 5 hereof, this Warrant and all rights hereunder are transferable, in whole or in part, without charge to the registered Holder, upon surrender of this Warrant with a properly executed Assignment (in substantially the form attached hereto as Exhibit B), to the Company, and the Company at its expense will issue and deliver to or upon the order of the Holder hereof a new Warrant or Warrants in such denomination or denominations as may be requested, but otherwise of like tenor, in the name of the Holder or as the Holder (upon payment of any applicable transfer taxes) may direct. 

8. Replacement of Warrants. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of any Warrant and, in the case of any such loss, theft or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Company at its expense will execute and deliver, in lieu thereof, a new Warrant of like tenor. 

9. Company Records. Until this Warrant is transferred on the books of the Company, the Company may treat the registered Holder hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary. 

  

  

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10.  Miscellaneous. 

10.1 Notices. All notices and other communications from the Company to the Holder of this Warrant shall be mailed by first class mail, postage prepaid, to such address as may have been furnished to the Company in writing by such Holder, or, until an address is so furnished, to and at the address of the last Holder of this Warrant who has so furnished an address to the Company. All communications from the Holder of this Warrant to the Company shall be mailed by first class mail, postage prepaid, to American Restaurant Concepts, Inc., 14476 Duval Place West, Suite 103, Jacksonville, Florida 32218: Chief Executive Officer, or such other address as may have been furnished to the Holder in writing by the Company. 

10.2 Amendment and Waiver. Except as otherwise provided herein, this Warrant and any term hereof may be amended, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such amendment, waiver, discharge or termination is sought. 

10.3 Governing Law; Descriptive Headings. This Warrant shall be construed and enforced in accordance with and governed by the laws of the State of Florida. The headings in this Warrant are for purposes of reference only, and shall not limit or otherwise affect any of the terms hereof. 

Dated:   _____________, 2010.

 

			
	 	 	 
	AMERICAN RESTAURANT CONCEPTS, INC.

	 	 
	By:

	 

	 

	Name:

	 

	James Robert Shaw

	Title:

	 

	Vice President

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EXHIBIT A

SUBSCRIPTION AGREEMENT

[To be signed only upon exercise of Warrant] 

			
	 

	 	 
	To:

	  

	Date:

The undersigned, the Holder of the within Warrant, pursuant to the provisions set forth in the within Warrant, hereby irrevocably elects to exercise the purchase rights represented by such Warrant for, and agrees to subscribe for and purchase thereunder,                      shares of the Common Stock covered by such Warrant and herewith makes payment of $                         therefor, and requests that the certificates for such shares be issued in the name of, and delivered to,                             , whose address is:                             . If said number of shares is less than all the shares covered by such Warrant, a new Warrant shall be registered in the name of the undersigned and delivered to the address stated below. 

			
	 

	 	 
	Signature

	 

	 

	 	 
	 	 

	(Signature must conform in all respects to name of Holder as specified on the face of the Warrant or on the form of Assignment attached as Exhibit B thereto.)

	 	 
	Address

	 

	 

	 	 
	 	 

	 

	 
	[Signature Guarantee]

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EXHIBIT B

ASSIGNMENT 

[To be signed only upon transfer of Warrant] 

For value received, the undersigned hereby sells, assigns and transfers all of the rights of the undersigned under the within Warrant with respect to the number of shares of the Common Stock covered thereby set forth below, unto:  

					
	 	 	 	 	 
	Name of Assignee

	  

	Address

	  

	No. of Shares

 

					
	 	 	 	 	 
	Dated:

	 

	Signature

	 

	 

	 	 	 
	 	 

	 	 

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

	 	 	 
	 	 

	Address

	 

	 

	 	 	 
	 	 

	 	 

	 

	 	 
	 	 

	[Signature Guarantee]

9gpxm10q20110331ex10-2.htm

Exhibit 10.2

 

March 3, 2011

Win-Eldrich Gold, Inc.

227 North 9th Street, Suite 200

Lincoln, NE  68508

Attn: Perry Muller, President

Dear Mr. Muller,

Pursuant to our recent discussions, this letter sets forth the framework of a potential transaction (the “Transaction”) pursuant to which Golden Phoenix Minerals, Inc., a Nevada corporation (“Golden Phoenix”), has agreed upon terms for the settlement of that certain outstanding Series A Limited Recourse Secured Promissory Note, dated April 15, 2010, in the principal amount of $4,231,925.19 (the “Note”), made by Win-Eldrich Gold, Inc. (“Win-Eldrich”). This letter, including the preliminary terms set out in Exhibit A, is intended to provide a framework for negotiating definitive agreements governing the Transaction (the “Agreements”). This letter shall be partially binding and partially non-binding as indicated below.

1.Non-binding Provisions

 

	
(a)

	
The parties will use reasonable, good faith efforts to negotiate the Agreements with the intent to finalize and execute the Agreements by no later than March 31, 2011 and close the Agreements within six (6) months thereafter (the “Outside Closing Date”), or such later dates as the parties may mutually agree upon in writing.

 

	
(b)

	
It is the intent of the parties that the terms of the Agreements reflect the terms described in the Memorandum of Terms set forth in Exhibit A attached hereto (the “Term Sheet”), subject only to such regulatory and corporate approvals, as may be required.

 

2.Binding Provisions 

NOTWITHSTANDING THE NON-BINDING NATURE OF THE FOREGOING PROVISIONS OF THIS LETTER OF INTENT, THE PARTIES EXPRESSLY AGREE TO BE BOUND BY THE FOLLOWING PROVISIONS:

 

(a)           Good Faith Discussions; Note Still Outstanding. This letter, including Exhibit A attached hereto, is intended to facilitate and present the basis for preparation of the Agreements embodying the final understanding of the parties regarding the Transaction.  The parties acknowledge that the terms contained in Exhibit A are non-binding, and are subject to approval of such regulatory authorities and corporate approvals as may be deemed necessary in order to finalize and close the Agreements.  Either party may discontinue negotiations toward the Agreements at any time by written notice to the other for any reason whatsoever.  Neither party will have any liability whatsoever to the other for such party’s discontinuance of such negotiations or its decision for any reason not to enter into such Agreements.  Both parties expressly agree that the Note shall remain outstanding and in full force and effect unless and until the Transaction closes.  Further, the parties agree that in the event the Transaction has not closed on or before the date that payments are scheduled to commence under the Note, such payments shall be made according to the terms of the Note and shall be applied to the cash portion of the settlement as set forth in Exhibit A.  However, in the event the Transaction has not closed on or prior to the Outside Closing Date, the parties expressly agree that any and all monthly installment payments made under the Note will be applied to the outstanding balance of principal and interest under the Note, according to the Note’s original terms, and the Note shall remain outstanding and full force and effect.

 

  

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(b)           Due Diligence Access.  Win-Eldrich will (and will cause its employees, agents and representatives to) provide Golden Phoenix and its representatives with true and correct copies of such  records, contracts and other instruments of Win-Eldrich confirming clear title and ownership of such assets and properties constituting the “Collateral” (as such term is defined in the Note and related transaction documents), as may be reasonably necessary for Golden Phoenix to enter into the Transaction.  Such information will be provided on a confidential basis as provided in paragraph (c) below.

(c)           Confidentiality.  Golden Phoenix and Win-Eldrich agree that any and all confidential information disclosed in connection with the proposed Transaction related to either party’s business that is not generally known to the public (the “Confidential Information”), will be used solely in connection with discussions related to the proposed Transaction, and that such material will be used for no other purpose.  No right or license, whether expressed or implied, in the Confidential Information is granted to the party receiving such Confidential Information other than in the manner and to the extent expressly authorized herein.  Upon termination of discussions related to the Transaction or as otherwise provided in the Agreements, any Confidential Information will be returned to the party disclosing the same or destroyed in accordance with the instructions of such disclosing party.

(d)           Governing Law and Venue.  This letter shall be construed in accordance with and all disputes hereunder shall be governed by the laws of the State of Nevada without reference to that state’s choice of law provisions. 

 

(e)           Counterparts.  This letter may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument; provided, however, that neither party shall be bound by any of the binding terms of this letter unless and until both parties have received an executed copy from the other.

 

(f)           Miscellaneous.  The parties agree that upon execution of the Agreements, the provisions of this letter and all prior discussions will merge into such Agreements.

 

  

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(g)           Expenses; Attorneys’ Fees.  Each party will bear its own expenses in connection with the negotiation and consummation of the Agreements and the Transaction and any actions taken by either party in reliance on this letter will be at such party’s sole risk and expense.

 

 

If the foregoing correctly sets forth the general terms of our agreement, kindly sign and return the enclosed copy of this letter.  We look forward to working with you to our mutual benefit.

 

 

 

	  	
Very truly yours,

	  	  
	  	
GOLDEN PHOENIX MINERALS, INC.

	  	  
	  	  
	  	  
	  	
By: ________________________

	  	
      Thomas Klein

	  	
      Chief Executive Officer

 

 

AGREED AND ACCEPTED

WIN-ELDRICH GOLD, INC.

By: ________________________

           Perry Muller

           President

  

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Exhibit A

MEMORANDUM OF TERMS

 

SETTLEMENT OF SECURED PROMISSORY NOTE

 

MADE BY WIN-ELDRICH IN FAVOR OF GOLDEN PHOENIX

 

	
Golden Phoenix

	
Golden Phoenix Minerals, Inc., a Nevada corporation

	
Win-Eldrich Gold, Inc.

	
Win-Eldrich Gold, Inc.

	
Promissory Note to be Settled

	
That certain Series A Limited Recourse Secured Promissory Note, made by Win-Eldrich in favor of Golden Phoenix, dated April 15, 2010, in the aggregate principal amount of $4,231,925.19, plus interest to accrue thereon (the “Note”), such Note subject to the following terms and conditions:

· Principal:  $4,231,925.19.

· Interest Rate:  5.25% per annum.

· Maturity Date:  April 1, 2015.

· Payment terms:  49 monthly payments commencing on April 1, 2011

· Security:  Note secured by certain “Collateral” defined in that certain Security Agreement, as amended, and Deed of Trust, each dated May 11, 2009.

	
Terms of Settlement

	
Golden Phoenix will forgive. release and forever discharge any and all obligations and liabilities of Win-Eldrich under the Note, in consideration for the following terms and conditions:

·Win-Eldrich to make cash payment of $500,000 to Golden Phoenix upon closing of the Agreement.

·Win-Eldrich Mines Ltd (“WEX”) (parent company of Win-Eldrich) to issue 3,000,000 shares of its common stock, upon closing of the Agreement.

·2% NSR on Ashdown Project/property in favor of Golden Phoenix, with 1% available to be purchased for a purchase price of $1,000,000.

·All liabilities and obligations of Win-Eldrich and/or Golden Phoenix related to the Tetra and DRC matters, as fully disclosed in the Membership Interest Purchase Agreement, shall be fully and finally assumed by Win-Eldrich, with Golden Phoenix released from all prior, current or future liability arising thereunder.

·Golden Phoenix has the right to appoint one individual to the Board of Directors of WEX

	
Definitive Agreements

	
The definitive agreements shall contain such representations, warranties, covenants and other agreements on behalf of Win-Eldrich as are satisfactory to Golden Phoenix and its counsel and the closing will be subject to customary closing conditions including the following: (i) normal and usual representations and warranties by the parties, all of which shall survive the closing, (ii) absence of material adverse conditions or circumstances of Win-Eldrich, (iii) satisfactory completion of Golden Phoenix’s due diligence investigation, (iv) indemnification of Golden Phoenix by Win-Eldrich on terms satisfactory to  Golden Phoenix for any damages and expenses arising from breach of Win- Eldroch’s representations, warranties and covenants in the definitive agreements, (v) obtaining any regulatory, corporate and third-party consents and approvals that may be required and (vi) Win-Eldrich obtaining any financing required to fulfill the terms of the note settlement.

	
Closing Date

	
September 30, 2011, or as soon as required closing conditions are met.

 

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