Rimrock Gold Corp (RMRK)

[Dobie Lama]

On April 14, 2014, Rimrock Gold Corp. (the “Company”) entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with Redwood Fund LP, a Delaware limited partnership (the “Purchaser”) for an aggregate principal amount of $100,000 (the “Purchase Price”). Pursuant to the Securities Purchase Agreement, the Company issued the following to the Purchaser: (i) a Convertible Promissory Note (the “First Note”); and (ii) a five-year warrant (the “ First Warrant”) to purchase an aggregate of 100,000 shares of the Company’s common stock, par value $0.001 per share, (the “Original Warrant Shares”) for an exercise price of $0.10 per share. The Purchaser shall also have the right to purchase from the Company, at the Purchaser’s discretion, within 30 days of the original purchase: (i) a second Convertible Note (the “Second Note” and, together with the First Note, the “Notes) within of the Note, in the original principal amount of $150,000; and (ii) a second warrant (the “Second Warrant” and, together with the First Warrant, the “Warrants”) to purchase up to 150,000 shares of the Company’s Common Stock (together with the Original Warrant Shares, the “Warrant Shares”).

The terms of the Note and the Warrant are as follows:

Convertible Promissory Notes

The Notes earn an interest rate per day equal to 12% and a maturity date of six months from the original issuance date. The Notes are convertible any time after 120 days after issuance, and the Purchaser has the right to convert the Note into shares of the Company’s common stock at a conversion price of $0.075 per share (the “Note Conversion Price”). The Note Conversion Price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization transactions and any issuances of securities below the Note Conversion Price.

The Company has the option to prepay all or any portion of the purchase price; however, the prepayment amount must be 110% of the principal amount to be prepaid together with all accrued but unpaid interest. In addition, the Company shall issue a Warrant at an exercise price of $0.10 per share for up to the prepayment amount.

In the event the Notes are not repaid on the Maturity Date, the interest rate on the Note shall be the lesser of 20% per annum or the maximum rate permissible by law.

Warrant

The Warrants are exercisable in whole or in part, at an initial exercise price per share of $0.10 (subject to adjustment) (the “Exercise Price”), and may be exercised on a cashless basis. The exercise price and number of shares of the Company’s common stock issuable under the Warrants are subject to adjustments for stock dividends, splits, combinations, subsequent rights offerings, pro rata distributions and similar events. Additionally, at any time that the Company issues any common stock at a price less than the Exercise Price, the Exercise Price shall then be reduced on a weighted average calculation. Any adjustment to the Exercise Price shall similarly cause the number of warrant shares to be adjusted proportionately so that the total value of the Warrants shall remain the same.

If, pursuant to the First Note, the Company has not paid in full the principal amount plus all accrued and unpaid interest thereon prior to 120 days following the closing date of the Second Note and Second Warrant, the First Warrant shall be deemed automatically amended to provide that the number of Original Warrant Shares shall increase from 100,000 to 200,000. All other terms of the First Warrant shall remain the same.






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