-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RD5g+q+gq9Oq3pTydGKlNIpMBQvXiCQgkp44+Tqp63pcKYc532I1yMgasggAFRms DDXOC24ClMWEAKGLRPdEuw== 0001144204-07-048512.txt : 20070907 0001144204-07-048512.hdr.sgml : 20070907 20070907171810 ACCESSION NUMBER: 0001144204-07-048512 CONFORMED SUBMISSION TYPE: SC 13G PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20070907 DATE AS OF CHANGE: 20070907 GROUP MEMBERS: DAVID GRIN GROUP MEMBERS: EUGENE GRIN GROUP MEMBERS: LAURUS CAPITAL MANAGEMENT, LLC GROUP MEMBERS: PSOURCE STRUCTURED DEBT LIMITED GROUP MEMBERS: VALENS CAPITAL MANAGEMENT, LLC GROUP MEMBERS: VALENS OFFSHORE SPV I, LTD. GROUP MEMBERS: VALENS U.S. SPV I, LLC FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: LAURUS MASTER FUND LTD CENTRAL INDEX KEY: 0001189294 IRS NUMBER: 980337673 STATE OF INCORPORATION: E9 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13G BUSINESS ADDRESS: STREET 1: 152 W 57TH ST CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2125415800 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: Silicon Mountain Holdings, Inc. CENTRAL INDEX KEY: 0000723928 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC COMPUTERS [3571] IRS NUMBER: 840910490 STATE OF INCORPORATION: CO FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: SC 13G SEC ACT: 1934 Act SEC FILE NUMBER: 005-35821 FILM NUMBER: 071107048 BUSINESS ADDRESS: STREET 1: 4755 WALNUT STREET CITY: BOULDER STATE: CO ZIP: 80301 BUSINESS PHONE: 303-938-1155 MAIL ADDRESS: STREET 1: 4755 WALNUT STREET CITY: BOULDER STATE: CO ZIP: 80301 FORMER COMPANY: FORMER CONFORMED NAME: Z AXIS CORP DATE OF NAME CHANGE: 19960126 SC 13G 1 v087279_sc13g.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13G (Rule 13d-102) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(b), (c) AND (d) AND AMENDMENTS THERETO FILED PURSUANT TO 13d-2(b) (AMENDMENT NO. __)* SILICON MOUNTAIN HOLDINGS, INC. ----------------------------------- (Name of Issuer) Common Stock, par value $0.001 per share ---------------------------------------- (Title of Class of Securities) 98919P108 --------- (CUSIP Number) August 30, 2007 -------------- (Date of Event which Requires Filing of this Statement) Check the appropriate box to designate the rule pursuant to which this Schedule is filed: [ ] Rule 13d-1 (b) [X] Rule 13d-1 (c) [ ] Rule 13d-1 (d) The information required in the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). CUSIP No. 98919P108 - --------- ---------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Laurus Master Fund, Ltd. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 98-0337673 - --------- ---------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] - --------- ---------------------------------------------------------------------- 3 SEC USE ONLY - --------- ---------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - --------- ---------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock. * SHARES ---- -------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 382,117 shares of Common Stock. * OWNED BY ---- -------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ---- -------------------------------------------------------------- PERSON 8 SHARED DISPOSITIVE POWER: 382,117 shares of Common Stock. * - --------- ---------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 382,117 shares of Common Stock - --------- ---------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [X] - --------- ---------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 9.99% - --------- ---------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON CO - --------- ---------------------------------------------------------------------- - --------------------------------- * Based on 3,825,000 shares of the common stock, par value $0.001 per share (the "Shares"), outstanding of Silicon Mountain Holdings, Inc., a Colorado corporation (the "Company"), as disclosed in the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2007. As of August 30, 2007, Laurus Master Fund, Ltd. (the "Fund"), Valens U.S. SPV I, LLC ("Valens U.S."), Valens Offshore SPV I, Ltd. ("Valens Offshore") and PSource Structured Debt Limited ("PSource" and together with the Fund, Valens U.S. and Valens Offshore, the "Investors") held (i) a Secured Convertible Term Note, in the aggregate initial principal amount of $2,500,000, which is convertible into Shares at a conversion rate of $3.69 per Share, subject to certain adjustments (the "Term Note"), (ii) a warrant (the "First August Warrant") to acquire 1,990,000 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments, and (iii) a warrant (the "Second August Warrant" and together with the First August Warrant, the "Warrants") to acquire 18,312 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments. The Term Note and Warrants contain an issuance limitation prohibiting the Investors from exercising or converting those securities to the extent that such exercise would result in beneficial ownership by the Investors of more than 9.99% of the Shares then issued and outstanding (the "Issuance Limitation"). The Issuance Limitation may be waived by the Investors upon at least 61 days prior notice to the Company and shall automatically become null and void following notice to the Company of the occurrence and during the continuance of an event of default (as defined in and pursuant to the terms of the applicable instrument). The Fund is managed by Laurus Capital Management, LLC ("LCM"). LCM, pursuant to an investment management agreement, also serves as the investment manager of PSource. Valens U.S. and Valens Offshore are managed by Valens Capital Management, LLC ("VCM"). Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and VCM, and share sole voting and investment power over the securities owned by the Investors reported in this Schedule 13G. CUSIP No. 98919P108 - ---------- --------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Laurus Capital Management, LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 13-4150669 - ---------- --------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] - ---------- --------------------------------------------------------------------- 3 SEC USE ONLY - ---------- --------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------- ---------- ------------------------------------------------ NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock. * SHARES ---- -------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 382,117 shares of Common Stock. * OWNED BY ---- -------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ---- -------------------------------------------------------------- PERSON 8 SHARED DISPOSITIVE POWER: 382,117 shares of Common Stock. * - ---------- --------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 382,117 shares of Common Stock - ---------- --------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [X] - ---------- --------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 9.99% - ---------- --------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON OO - ---------- --------------------------------------------------------------------- - -------------------------------- * Based on 3,825,000 shares of the common stock, par value $0.001 per share (the "Shares"), outstanding of Silicon Mountain Holdings, Inc., a Colorado corporation (the "Company"), as disclosed in the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2007. As of August 30, 2007, Laurus Master Fund, Ltd. (the "Fund"), Valens U.S. SPV I, LLC ("Valens U.S."), Valens Offshore SPV I, Ltd. ("Valens Offshore") and PSource Structured Debt Limited ("PSource" and together with the Fund, Valens U.S. and Valens Offshore, the "Investors") held (i) a Secured Convertible Term Note, in the aggregate initial principal amount of $2,500,000, which is convertible into Shares at a conversion rate of $3.69 per Share, subject to certain adjustments (the "Term Note"), (ii) a warrant (the "First August Warrant") to acquire 1,990,000 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments, and (iii) a warrant (the "Second August Warrant" and together with the First August Warrant, the "Warrants") to acquire 18,312 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments. The Term Note and Warrants contain an issuance limitation prohibiting the Investors from exercising or converting those securities to the extent that such exercise would result in beneficial ownership by the Investors of more than 9.99% of the Shares then issued and outstanding (the "Issuance Limitation"). The Issuance Limitation may be waived by the Investors upon at least 61 days prior notice to the Company and shall automatically become null and void following notice to the Company of the occurrence and during the continuance of an event of default (as defined in and pursuant to the terms of the applicable instrument). The Fund is managed by Laurus Capital Management, LLC ("LCM"). LCM, pursuant to an investment management agreement, also serves as the investment manager of PSource. Valens U.S. and Valens Offshore are managed by Valens Capital Management, LLC ("VCM"). Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and VCM, and share sole voting and investment power over the securities owned by the Investors reported in this Schedule 13G. CUSIP No. 98919P108 - --------- ---------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Valens U.S. SPV I, LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: - --------- ---------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] - --------- ---------------------------------------------------------------------- 3 SEC USE ONLY - --------- ---------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - --------- ---------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock. * SHARES ---- -------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 382,117 shares of Common Stock. * OWNED BY ---- -------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ---- -------------------------------------------------------------- PERSON 8 SHARED DISPOSITIVE POWER: 382,117 shares of Common Stock. * - --------- ---------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 382,117 shares of Common Stock - --------- ---------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [X] - --------- ---------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 9.99% - --------- ---------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON OO - --------- ---------------------------------------------------------------------- - --------------------------------- * Based on 3,825,000 shares of the common stock, par value $0.001 per share (the "Shares"), outstanding of Silicon Mountain Holdings, Inc., a Colorado corporation (the "Company"), as disclosed in the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2007. As of August 30, 2007, Laurus Master Fund, Ltd. (the "Fund"), Valens U.S. SPV I, LLC ("Valens U.S."), Valens Offshore SPV I, Ltd. ("Valens Offshore") and PSource Structured Debt Limited ("PSource" and together with the Fund, Valens U.S. and Valens Offshore, the "Investors") held (i) a Secured Convertible Term Note, in the aggregate initial principal amount of $2,500,000, which is convertible into Shares at a conversion rate of $3.69 per Share, subject to certain adjustments (the "Term Note"), (ii) a warrant (the "First August Warrant") to acquire 1,990,000 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments, and (iii) a warrant (the "Second August Warrant" and together with the First August Warrant, the "Warrants") to acquire 18,312 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments. The Term Note and Warrants contain an issuance limitation prohibiting the Investors from exercising or converting those securities to the extent that such exercise would result in beneficial ownership by the Investors of more than 9.99% of the Shares then issued and outstanding (the "Issuance Limitation"). The Issuance Limitation may be waived by the Investors upon at least 61 days prior notice to the Company and shall automatically become null and void following notice to the Company of the occurrence and during the continuance of an event of default (as defined in and pursuant to the terms of the applicable instrument). The Fund is managed by Laurus Capital Management, LLC ("LCM"). LCM, pursuant to an investment management agreement, also serves as the investment manager of PSource. Valens U.S. and Valens Offshore are managed by Valens Capital Management, LLC ("VCM"). Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and VCM, and share sole voting and investment power over the securities owned by the Investors reported in this Schedule 13G. CUSIP No. 98919P108 - --------- ---------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Valens Offshore SPV I, Ltd. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: - --------- ---------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] - --------- ---------------------------------------------------------------------- 3 SEC USE ONLY - --------- ---------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - --------- ---------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock. * SHARES ---- -------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 382,117 shares of Common Stock. * OWNED BY ---- -------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ---- -------------------------------------------------------------- PERSON 8 SHARED DISPOSITIVE POWER: 382,117 shares of Common Stock. * - --------- ---------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 382,117 shares of Common Stock - --------- ---------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [X] - --------- ---------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 9.99% - --------- ---------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON CO - --------- ---------------------------------------------------------------------- - --------------------------------- * Based on 3,825,000 shares of the common stock, par value $0.001 per share (the "Shares"), outstanding of Silicon Mountain Holdings, Inc., a Colorado corporation (the "Company"), as disclosed in the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2007. As of August 30, 2007, Laurus Master Fund, Ltd. (the "Fund"), Valens U.S. SPV I, LLC ("Valens U.S."), Valens Offshore SPV I, Ltd. ("Valens Offshore") and PSource Structured Debt Limited ("PSource" and together with the Fund, Valens U.S. and Valens Offshore, the "Investors") held (i) a Secured Convertible Term Note, in the aggregate initial principal amount of $2,500,000, which is convertible into Shares at a conversion rate of $3.69 per Share, subject to certain adjustments (the "Term Note"), (ii) a warrant (the "First August Warrant") to acquire 1,990,000 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments, and (iii) a warrant (the "Second August Warrant" and together with the First August Warrant, the "Warrants") to acquire 18,312 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments. The Term Note and Warrants contain an issuance limitation prohibiting the Investors from exercising or converting those securities to the extent that such exercise would result in beneficial ownership by the Investors of more than 9.99% of the Shares then issued and outstanding (the "Issuance Limitation"). The Issuance Limitation may be waived by the Investors upon at least 61 days prior notice to the Company and shall automatically become null and void following notice to the Company of the occurrence and during the continuance of an event of default (as defined in and pursuant to the terms of the applicable instrument). The Fund is managed by Laurus Capital Management, LLC ("LCM"). LCM, pursuant to an investment management agreement, also serves as the investment manager of PSource. Valens U.S. and Valens Offshore are managed by Valens Capital Management, LLC ("VCM"). Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and VCM, and share sole voting and investment power over the securities owned by the Investors reported in this Schedule 13G. CUSIP No. 98919P108 - --------- ---------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Valens Capital Management, LLC S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: - --------- ---------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] - --------- ---------------------------------------------------------------------- 3 SEC USE ONLY - --------- ---------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - --------- ---------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock. * SHARES ---- -------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 382,117 shares of Common Stock. * OWNED BY ---- -------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ---- -------------------------------------------------------------- PERSON 8 SHARED DISPOSITIVE POWER: 382,117 shares of Common Stock. * - --------- ---------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 382,117 shares of Common Stock - --------- ---------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [X] - --------- ---------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 9.99% - --------- ---------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON OO - --------- ---------------------------------------------------------------------- - --------------------------------- * Based on 3,825,000 shares of the common stock, par value $0.001 per share (the "Shares"), outstanding of Silicon Mountain Holdings, Inc., a Colorado corporation (the "Company"), as disclosed in the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2007. As of August 30, 2007, Laurus Master Fund, Ltd. (the "Fund"), Valens U.S. SPV I, LLC ("Valens U.S."), Valens Offshore SPV I, Ltd. ("Valens Offshore") and PSource Structured Debt Limited ("PSource" and together with the Fund, Valens U.S. and Valens Offshore, the "Investors") held (i) a Secured Convertible Term Note, in the aggregate initial principal amount of $2,500,000, which is convertible into Shares at a conversion rate of $3.69 per Share, subject to certain adjustments (the "Term Note"), (ii) a warrant (the "First August Warrant") to acquire 1,990,000 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments, and (iii) a warrant (the "Second August Warrant" and together with the First August Warrant, the "Warrants") to acquire 18,312 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments. The Term Note and Warrants contain an issuance limitation prohibiting the Investors from exercising or converting those securities to the extent that such exercise would result in beneficial ownership by the Investors of more than 9.99% of the Shares then issued and outstanding (the "Issuance Limitation"). The Issuance Limitation may be waived by the Investors upon at least 61 days prior notice to the Company and shall automatically become null and void following notice to the Company of the occurrence and during the continuance of an event of default (as defined in and pursuant to the terms of the applicable instrument). The Fund is managed by Laurus Capital Management, LLC ("LCM"). LCM, pursuant to an investment management agreement, also serves as the investment manager of PSource. Valens U.S. and Valens Offshore are managed by Valens Capital Management, LLC ("VCM"). Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and VCM, and share sole voting and investment power over the securities owned by the Investors reported in this Schedule 13G. CUSIP No. 98919P108 - --------- ---------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: PSource Structured Debt Limited S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: - --------- ---------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] - --------- ---------------------------------------------------------------------- 3 SEC USE ONLY - --------- ---------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Guernsey - --------- ---------------------------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock. * SHARES ---- -------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 382,117 shares of Common Stock. * OWNED BY ---- -------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ---- -------------------------------------------------------------- PERSON 8 SHARED DISPOSITIVE POWER: 382,117 shares of Common Stock. * - --------- ---------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 382,117 shares of Common Stock - --------- ---------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [X] - --------- ---------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 9.99% - --------- ---------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON OO - --------- ---------------------------------------------------------------------- - --------------------------------- * Based on 3,825,000 shares of the common stock, par value $0.001 per share (the "Shares"), outstanding of Silicon Mountain Holdings, Inc., a Colorado corporation (the "Company"), as disclosed in the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2007. As of August 30, 2007, Laurus Master Fund, Ltd. (the "Fund"), Valens U.S. SPV I, LLC ("Valens U.S."), Valens Offshore SPV I, Ltd. ("Valens Offshore") and PSource Structured Debt Limited ("PSource" and together with the Fund, Valens U.S. and Valens Offshore, the "Investors") held (i) a Secured Convertible Term Note, in the aggregate initial principal amount of $2,500,000, which is convertible into Shares at a conversion rate of $3.69 per Share, subject to certain adjustments (the "Term Note"), (ii) a warrant (the "First August Warrant") to acquire 1,990,000 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments, and (iii) a warrant (the "Second August Warrant" and together with the First August Warrant, the "Warrants") to acquire 18,312 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments. The Term Note and Warrants contain an issuance limitation prohibiting the Investors from exercising or converting those securities to the extent that such exercise would result in beneficial ownership by the Investors of more than 9.99% of the Shares then issued and outstanding (the "Issuance Limitation"). The Issuance Limitation may be waived by the Investors upon at least 61 days prior notice to the Company and shall automatically become null and void following notice to the Company of the occurrence and during the continuance of an event of default (as defined in and pursuant to the terms of the applicable instrument). The Fund is managed by Laurus Capital Management, LLC ("LCM"). LCM, pursuant to an investment management agreement, also serves as the investment manager of PSource. Valens U.S. and Valens Offshore are managed by Valens Capital Management, LLC ("VCM"). Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and VCM, and share sole voting and investment power over the securities owned by the Investors reported in this Schedule 13G. CUSIP No. 98919P108 - ---------- --------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: David Grin - ---------- --------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] - ---------- --------------------------------------------------------------------- 3 SEC USE ONLY - ---------- --------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION Israel - -------------------- ---------- ------------------------------------------------ NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock. * SHARES ---- -------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 382,117 shares of Common Stock. * OWNED BY ---- -------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ---- -------------------------------------------------------------- PERSON 8 SHARED DISPOSITIVE POWER: 382,117 shares of Common Stock. * - --------- ---------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 382,117 shares of Common Stock - --------- ---------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [X] - --------- ---------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 9.99% - --------- ---------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON IN - --------- ---------------------------------------------------------------------- - -------------------------------- * Based on 3,825,000 shares of the common stock, par value $0.001 per share (the "Shares"), outstanding of Silicon Mountain Holdings, Inc., a Colorado corporation (the "Company"), as disclosed in the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2007. As of August 30, 2007, Laurus Master Fund, Ltd. (the "Fund"), Valens U.S. SPV I, LLC ("Valens U.S."), Valens Offshore SPV I, Ltd. ("Valens Offshore") and PSource Structured Debt Limited ("PSource" and together with the Fund, Valens U.S. and Valens Offshore, the "Investors") held (i) a Secured Convertible Term Note, in the aggregate initial principal amount of $2,500,000, which is convertible into Shares at a conversion rate of $3.69 per Share, subject to certain adjustments (the "Term Note"), (ii) a warrant (the "First August Warrant") to acquire 1,990,000 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments, and (iii) a warrant (the "Second August Warrant" and together with the First August Warrant, the "Warrants") to acquire 18,312 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments. The Term Note and Warrants contain an issuance limitation prohibiting the Investors from exercising or converting those securities to the extent that such exercise would result in beneficial ownership by the Investors of more than 9.99% of the Shares then issued and outstanding (the "Issuance Limitation"). The Issuance Limitation may be waived by the Investors upon at least 61 days prior notice to the Company and shall automatically become null and void following notice to the Company of the occurrence and during the continuance of an event of default (as defined in and pursuant to the terms of the applicable instrument). The Fund is managed by Laurus Capital Management, LLC ("LCM"). LCM, pursuant to an investment management agreement, also serves as the investment manager of PSource. Valens U.S. and Valens Offshore are managed by Valens Capital Management, LLC ("VCM"). Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and VCM, and share sole voting and investment power over the securities owned by the Investors reported in this Schedule 13G. CUSIP No. 98919P108 - --------- ---------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: Eugene Grin - --------- ---------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] - --------- ---------------------------------------------------------------------- 3 SEC USE ONLY - --------- ---------------------------------------------------------------------- 4 CITIZENSHIP OR PLACE OF ORGANIZATION United States - ------------------- ---------- ------------------------------------------------- NUMBER OF 5 SOLE VOTING POWER: 0 shares of Common Stock.* SHARES ---- -------------------------------------------------------------- BENEFICIALLY 6 SHARED VOTING POWER: 382,117 shares of Common Stock. * OWNED BY ---- -------------------------------------------------------------- EACH 7 SOLE DISPOSITIVE POWER: 0 shares of Common Stock. * REPORTING ---- -------------------------------------------------------------- PERSON 8 SHARED DISPOSITIVE POWER: 382,117 shares of Common Stock. * - --------- ---------------------------------------------------------------------- 9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 382,117 shares of Common Stock - --------- ---------------------------------------------------------------------- 10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [X] - --------- ---------------------------------------------------------------------- 11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9 9.99% - --------- ---------------------------------------------------------------------- 12 TYPE OF REPORTING PERSON IN - --------- ---------------------------------------------------------------------- - -------------------------------- * Based on 3,825,000 shares of the common stock, par value $0.001 per share (the "Shares"), outstanding of Silicon Mountain Holdings, Inc., a Colorado corporation (the "Company"), as disclosed in the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2007. As of August 30, 2007, Laurus Master Fund, Ltd. (the "Fund"), Valens U.S. SPV I, LLC ("Valens U.S."), Valens Offshore SPV I, Ltd. ("Valens Offshore") and PSource Structured Debt Limited ("PSource" and together with the Fund, Valens U.S. and Valens Offshore, the "Investors") held (i) a Secured Convertible Term Note, in the aggregate initial principal amount of $2,500,000, which is convertible into Shares at a conversion rate of $3.69 per Share, subject to certain adjustments (the "Term Note"), (ii) a warrant (the "First August Warrant") to acquire 1,990,000 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments, and (iii) a warrant (the "Second August Warrant" and together with the First August Warrant, the "Warrants") to acquire 18,312 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments. The Term Note and Warrants contain an issuance limitation prohibiting the Investors from exercising or converting those securities to the extent that such exercise would result in beneficial ownership by the Investors of more than 9.99% of the Shares then issued and outstanding (the "Issuance Limitation"). The Issuance Limitation may be waived by the Investors upon at least 61 days prior notice to the Company and shall automatically become null and void following notice to the Company of the occurrence and during the continuance of an event of default (as defined in and pursuant to the terms of the applicable instrument). The Fund is managed by Laurus Capital Management, LLC ("LCM"). LCM, pursuant to an investment management agreement, also serves as the investment manager of PSource. Valens U.S. and Valens Offshore are managed by Valens Capital Management, LLC ("VCM"). Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and VCM, and share sole voting and investment power over the securities owned by the Investors reported in this Schedule 13G. CUSIP No. 98919P108 Item 1(a). Name of Issuer: Silicon Mountain Holdings, Inc. Item 1(b). Address of Issuer's Principal Executive Offices: 5445 DTC Parkway, Suite 450 Greenwood Village, Colorado 80111-3143 Item 2(a). Name of Person Filing: Laurus Master Fund, Ltd. This Schedule 13G is also filed on behalf of Laurus Capital Management, LLC, a Delaware limited liability company, Valens U.S. SPV I, LLC, a Delaware limited liability company, Valens Offshore SPV I, Ltd., an exempted company incorporated with limited liability under the laws of the Cayman Islands, Valens Capital Management, LLC, a Delaware limited liability company, PSource Structured Debt Limited, a closed-ended company incorporated with limited liability in Guernsey, Eugene Grin and David Grin. Laurus Capital Management, LLC manages Laurus Master Fund, Ltd. and serves as the investment manager of PSource Structured Debt Limited. Valens Capital Management, LLC manages each of Valens U.S. SPV I, LLC and Valens Offshore SPV I, Ltd. Eugene Grin and David Grin, through other entities, are the controlling principals of Laurus Capital Management, LLC and Valens Capital Management, LLC and share voting and investment power over the securities owned by Laurus Master Fund, Ltd., Valens U.S. SPV I, LLC, Valens Offshore SPV I, Ltd. and PSource Structured Debt Limited. Information related to each of Laurus Capital Management, LLC, Valens U.S. SPV I, LLC, Valens Offshore SPV I,Ltd., Valens Capital Management, LLC, PSource Structured Debt Limited, Eugene Grin and David Grin is set forth on Appendix A hereto. Item 2(b). Address of Principal Business Office or if none, Residence: c/o Laurus Capital Management, LLC, 335 Madison Avenue, 10th Floor, New York, NY 10017 Item 2(c). Citizenship: Cayman Islands Item 2(d). Title of Class of Securities: Common Stock ("Common Stock") Item 2(e). CUSIP Number: 98919P108 Item 3. Not Applicable Item 4. Ownership: (a) Amount Beneficially Owned: 382,117 shares of Common Stock (b) Percent of Class: 9.99% (c) Number of shares as to which such person has: (i) sole power to vote or to direct the vote: 0 shares of Common Stock.* (ii) shared power to vote or to direct the vote: 382,117 shares of Common Stock. * (iii) sole power to dispose or to direct the disposition of: 0 shares of Common Stock. * (iv) shared power to dispose or to direct the disposition of: 382,117 shares of Common Stock. * Item 5. Ownership of Five Percent or Less of a Class: Not applicable Item 6. Ownership of More than Five Percent on Behalf of Another Person: Not applicable Item 7. Identification and Classification of Subsidiary Which Acquired the Securities: Not applicable Item 8. Identification and Classification of Members of the Group: Not applicable Item 9. Notice of Dissolution of Group: Not applicable Item 10. Certification: By signing below, I certify to the best of my knowledge and belief, the securities referred to above were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect. - ----------------------------------- * Based on 3,825,000 shares of the common stock, par value $0.001 per share (the "Shares"), outstanding of Silicon Mountain Holdings, Inc., a Colorado corporation (the "Company"), as disclosed in the Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 2007. As of August 30, 2007, Laurus Master Fund, Ltd. (the "Fund"), Valens U.S. SPV I, LLC ("Valens U.S."), Valens Offshore SPV I, Ltd. ("Valens Offshore") and PSource Structured Debt Limited ("PSource" and together with the Fund, Valens U.S. and Valens Offshore, the "Investors") held (i) a Secured Convertible Term Note, in the aggregate initial principal amount of $2,500,000, which is convertible into Shares at a conversion rate of $3.69 per Share, subject to certain adjustments (the "Term Note"), (ii) a warrant (the "First August Warrant") to acquire 1,990,000 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments, and (iii) a warrant (the "Second August Warrant" and together with the First August Warrant, the "Warrants") to acquire 18,312 Shares, at an exercise price of $0.01 per Share, subject to certain adjustments. The Term Note and Warrants contain an issuance limitation prohibiting the Investors from exercising or converting those securities to the extent that such exercise would result in beneficial ownership by the Investors of more than 9.99% of the Shares then issued and outstanding (the "Issuance Limitation"). The Issuance Limitation may be waived by the Investors upon at least 61 days prior notice to the Company and shall automatically become null and void following notice to the Company of the occurrence and during the continuance of an event of default (as defined in and pursuant to the terms of the applicable instrument). The Fund is managed by Laurus Capital Management, LLC ("LCM"). LCM, pursuant to an investment management agreement, also serves as the investment manager of PSource. Valens U.S. and Valens Offshore are managed by Valens Capital Management, LLC ("VCM"). Eugene Grin and David Grin, through other entities, are the controlling principals of LCM and VCM, and share sole voting and investment power over the securities owned by the Investors reported in this Schedule 13G. CUSIP No. 98919P108 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. September 7, 2007 ---------------- Date /s/ David Grin ---------------- David Grin Director CUSIP No. 98919P108 APPENDIX A A. Name: Laurus Capital Management, LLC, a Delaware limited liability company 335 Madison Avenue, 10th Floor New York, New York 10017 Place of Organization: Delaware B. Name: Valens U.S. SPV I, LLC, a Delaware limited liability company 335 Madison Avenue, 10th Floor New York, New York 10017 Place of Organization: Delaware C. Name: Valens Offshore SPV I, Ltd., an exempted company incorporated with limited liability under the laws of the Cayman Islands 335 Madison Avenue, 10th Floor New York, New York 10017 Place of Organization: Cayman Islands D. Name: Valens Capital Management, LLC, a Delaware limited liability company 335 Madison Avenue, 10th Floor New York, New York 10017 Place of Organization: Delaware E. Name: PSource Structured Debt Limited, a Guernsey limited liability closed-ended company 335 Madison Avenue, 10th Floor New York, New York 10017 Place of Organization: Guernsey F. Name: David Grin Business 335 Madison Avenue, 10th Floor Address: New York, New York 10017 Principal Director of Laurus Master Fund, Ltd. Occupation: Principal of Laurus Capital Management, LLC and Valens Capital Management, LLC Citizenship: Israel G. Name: Eugene Grin Business 335 Madison Avenue, 10th Floor Address: New York, New York 10017 Principal Director of Laurus Master Fund, Ltd. Occupation: Principal of Laurus Capital Management, LLC and Valens Capital Management, LLC Citizenship: United States CUSIP No. 98919P108 Each of Laurus Capital Management, LLC, Valens U.S. SPV I, LLC, Valens Offshore SPV, Ltd., Valens Capital Management, LLC, PSource Structured Debt Limited, Eugene Grin and David Grin hereby agree, by their execution below, that the Schedule 13G to which this Appendix A is attached is filed on behalf of each of them, respectively. Laurus Capital Management, LLC /s/ David Grin - ----------------------------------------- David Grin Principal September 7, 2007 Valens U.S. SPV I, LLC /s/ David Grin - ----------------------------------------- David Grin Authorized Signatory September 7, 2007 /s/ Eugene Grin - ----------------------------------------- Eugene Grin Authorized Signatory September 7, 2007 Valens Offshore SPV I, Ltd. /s/ David Grin - ----------------------------------------- David Grin Authorized Signatory September 7, 2007 /s/ Eugene Grin - ----------------------------------------- Eugene Grin Authorized Signatory September 7, 2007 Valens Capital Management, LLC /s/ David Grin - ----------------------------------------- David Grin Principal September 7, 2007 /s/ Eugene Grin - ----------------------------------------- Eugene Grin Principal September 7, 2007 PSource Structured Debt Limited t 6 0 By: PSource Capital Limited, Being Authorized To Act On Behalf of PSource Structured Debt Limited - ----------------------------------------- Name: Title: Date: /s/ David Grin - ----------------------------------------- David Grin September 7, 2007 /s/ Eugene Grin - ----------------------------------------- Eugene Grin September 7, 2007 -----END PRIVACY-ENHANCED MESSAGE-----