Exhibit 4.5
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Number of
Shares of Common Stock:___
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Option #____
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OPTION
t o P u r c h a s e
Common Stock, $.01 Par Value
of
Western Goldfields, Inc.
an Idaho corporation
THIS IS TO CERTIFY THAT for value
received, _________________, hereinafter "Holder", is entitled to
purchase from Western Goldfields, Inc., an Idaho corporation
(hereinbelow called the "Issuer" or the "Company"), on or after
April 15, 20__, but not later than 5:00 p.m. eastern standard time
on April 15, 20__ (the "Expiration Date"), the above number of
shares of the Company's Common Stock, in whole or in part, at a
purchase price of $.40 per share of Common Stock, all on the terms
and conditions herein below provided.
Section 1. Certain Definitions. As used
in this Option, unless the context otherwise requires:
"Common Stock" shall mean the Issuer's authorized Common Stock,
with $0.01 par
"Common Stock Option" or "Option"
shall mean this Option for the
purchase of up to the number of shares specified above, in the
aggregate, of Common Stock, and all additional or new Options
issued upon division or combination of, or in substitution for,
this Option. All such additional or new Options shall at all times
be identical as to terms and conditions and date, except as to the
number of shares of Common Stock for which they may be
exercised.
"Exercise Price" shall mean the purchase price of $.40 per share
of Common Stock unless otherwise inapplicable by other terms of
this Option.
"Marketable Securities" shall mean securities registered under the
Securities Act of 1933 (the "Securities Act") and, if such
securities are held by an affiliate of the Issuer, which are
permitted to be sold under Rule 144 in a single ninety-day
period.
"Option Stock" shall mean the shares of Common Stock
purchasable by the holder of a Option upon the exercise of such
Option.
Section 2. Exercise of Option. This
Option may be exercised in whole or in part on or after April 15,
2006 and thereafter through the Expiration Date.
1
The holder of this Option may exercise this
Option, in whole or in part by delivering to the Issuer at its
office maintained for such purpose pursuant to Section 12, (i) a
written notice of such holder's election to exercise this Option,
which notice shall specify the number of shares of Common Stock to
be purchased, (ii) this Option and (iii) a sum equal to the
aggregate of the Exercise Price for such shares of Common Stock, by
check or other transfer in immediately available funds. Such notice
shall be in the form of the Subscription Form set out at the end of
this Option.
Additionally, if and when the closing common
share price of the Company exceeds $2.00, this Option may also be
exercised in whole or in part by means of a "cashless exercise" by
tendering this Option to the Company to receive a number of shares
of Common Stock equal in Market Value to the difference between the
Market Value of the shares of Common Stock issuable upon such
exercise of this Option and the total cash exercise price of that
part of the Option being exercised. "Market Value" for this purpose
shall be the closing price of the Common Stock as reported by
Bloomberg L.P. on the date of such cashless exercise. Certificates
for shares purchased hereunder shall be delivered to the Holder
hereof within ten (10) Trading Days after the date on which this
Option shall have been exercised as aforesaid. This Option shall be
deemed to have been exercised and such certificate or certificates
shall be deemed to have been issued, and the Holder or any other
person so designated to be named therein shall be deemed to have
become a the Holder of record of such shares for all purposes, as
of the date the Option has been exercised by payment to the Company
of the Exercise Price and all taxes required to be paid by the
Holder, if any, prior to the issuance of such shares, have been
paid. If this Option shall have been exercised in part, the Company
shall, at the time of delivery of the certificate or certificates
representing the Option Shares, deliver to the Holder a new Option
evidencing the rights of the Holder to purchase the unpurchased
shares of Common Stock called for by this Option, which new Option
shall in all other respects be identical with this
Option.
Subject to the restriction in Section 9, the
stock certificate or certificates for Option Stock so delivered
shall be in such denominations as may be specified in said notice
and shall be registered in the name of such holder or such other
name or names as shall be designated in said notice. Such
certificate or certificates shall be deemed to have been issued and
such holder or any other person so designated to be named therein
shall be deemed to have become a holder of record of such shares,
including to the extent permitted by law the right to vote such
shares or to consent or to receive notice as a shareholder, as of
the time said notice is delivered to the Issuer as aforesaid. If
this Option shall have been exercised only in part, the Issuer
shall, at the time of delivery of such certificate or certificates,
deliver to such holder a new Option dated the date it is issued,
evidencing the rights of such holder to purchase the remaining
shares of Common Stock called for by this Option, which new Option
shall in all other respects be identical with this Option, or, at
the request of such holder, appropriate notation may be made on
this Option and the Option shall be returned to such
holder.
The
Issuer shall pay all expenses, taxes and other charges payable in
connection with the preparation, issue and delivery of stock
certificates under this Section 2.
All
shares of Common Stock issuable upon the exercise of this Option in
accordance with the terms hereof shall be validly issued, fully
paid and nonassessable, and free from all liens and other
encumbrances thereon, other than liens or other encumbrances
created by the holder hereof, and shall be delivered within ten
business days of their exercise. Such shares issued shall bear a
restrictive legend as follows:
3
"The securities evidenced hereby have not been
registered under the Securities Act of 1933, as amended, nor any
other applicable securities act (the "Acts"), and may not be sold,
transferred, assigned, pledged or otherwise distributed, unless
there is an effective registration statement under such Acts
covering such securities or the Company receives an opinion of
counsel for the holder of these securities (concurred on by
counsel for the Company) stating that such sale,
transfer, assignment, p
