Exhibit 4.1
THIS WARRANT AND ANY WARRANT SHARES ISSUED UPON EXERCISE OF THIS
WARRANT ARE SUBJECT TO A SECURITIES PURCHASE AGREEMENT, DATED AS OF JANUARY 18,
2005, AS AMENDED, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THE
COMPANY AND WILL BE FURNISHED TO THE HOLDER ON REQUEST TO THE SECRETARY OF THE
COMPANY. SUCH SECURITIES PURCHASE AGREEMENT PROVIDES, AMONG OTHER THINGS, FOR
CERTAIN RESTRICTIONS ON DISPOSITION OF THE SECURITIES EVIDENCED BY THIS
CERTIFICATE.
THIS WARRANT, THE PURCHASE RIGHTS EVIDENCED BY THIS WARRANT AND ANY
WARRANT SHARES WHICH MAY BE ISSUED UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR ANY STATE SECURITIES LAW, AND THIS WARRANT, SUCH PURCHASE RIGHTS AND
WARRANT SHARES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE
SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT
REQUIRED.
No. __ Warrant to Purchase
_______ shares of Common Stock
Dated: March 1, 2005
(subject to adjustment
as described herein)
WARRANT CERTIFICATE
Representing Common Stock Purchase Warrant
AMEN PROPERTIES, INC.
Purchase Price of Common Stock: $4.00 per share
(subject to adjustment)
THIS WARRANT CERTIFICATE (THIS "WARRANT") CERTIFIES that, for value
received, _________________________________, his registered assigns or the
Holder (as defined below) hereof, is entitled, at any time prior to the close of
business on the Expiration Date defined below, to purchase the number of shares
stated above (subject to adjustment as herein provided) of Common Stock of Amen
Properties, Inc., a Delaware corporation (the "COMPANY"), at the purchase price
per share stated above (subject to adjustment as herein provided) (the "PURCHASE
PRICE") upon surrender of this Warrant at the Principal Office of the Company
and payment of such Purchase Price in cash or by bank cashier's or certified
check.
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This Warrant is one of the Warrants originally issued by the Company,
initially covering an aggregate of 250,000 shares of Common Stock, pursuant to a
Securities Purchase Agreement dated as of January 18, 2005 between the Company
and the purchasers named on the signature pages thereto, as amended by that
certain First Amendment to Securities Purchase Agreement dated as of January 28,
2005 and that certain Second Amendment to Securities Purchase Agreement dated as
of February 28, 2005 (the "PURCHASE AGREEMENT").
SECTION 1. DEFINITIONS. The following terms have the meanings set
forth below. Additional terms are defined elsewhere herein.
"COMMON STOCK" means the Common Stock, par value $.01 per share, of the
Company.
"EXERCISE DATE" with respect to any Warrant means each date on which
Warrant Shares are to be issued upon exercise of such Warrant.
"EXPIRATION DATE" means March 1, 2008.
"HOLDER" means the registered holder or holders of this Warrant and any
related Warrant Shares.
"HOLDERS" means the registered holders of all Warrants and any related
Warrant Shares.
"PRINCIPAL OFFICE" means the principal office of the Company which, on
the date hereof, is located at 000 Xxxx Xxxx, Xxxxx 0000, Xxxxxxx Xxxxx 00000.
The Company shall notify each Warrantholder of any change in its principal
office.
"PURCHASE PRICE" has the meaning assigned to that term in the
introductory paragraph hereof.
"PURCHASERS" means all of the initial Holders of the Warrants who
purchased the Warrants from the Company.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SERIES C PREFERRED STOCK" means the Series C Convertible Preferred
Stock, par value $.001 per share, of the Company.
"WARRANTS" means the Company's Common Stock Purchase Warrants and any
Warrant Certificates representing such Common Stock Purchase Warrants (including
the Warrant represented by this Warrant Certificate) issued pursuant to the
Purchase Agreement, each identical as to the terms and conditions of this
Warrant Certificate except as to the number of shares of Common Stock for which
they may be exercised, evidencing, in the aggregate, the right to purchase
initially 250,000 shares of Common Stock, all Warrants issued in exchange,
transfer or replacement thereof.
"WARRANT SHARES" means the shares of Common Stock purchased or
purchasable by the Holder upon the exercise of this Warrant pursuant to Section
2 hereof, and, where the context so requires, the shares of Common Stock
issuable upon exercise of any other Warrant by the Holder thereof.
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Any capitalized term not otherwise defined herein shall have the meaning
specified in the Purchase Agreement.
SECTION 2. EXERCISE.
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A. GENERAL. Subject to the limitation set forth in Section 2E and any
other limitation set forth herein or in the Purchase Agreement or imposed by
applicable law, each Holder shall be entitled to exercise any Warrant held by
it, in whole or in part, at any time or from time to time commencing on the date
of issuance of the Warrant until 5:00 p.m., Midland, Texas time, on the
Expiration Date.
B. MANNER OF EXERCISE. In order to exercise any Warrant in whole or in
part, the Holder shall complete one of the subscription forms attached hereto,
deliver the Warrant to the Company at its Principal Office and make payment of
the Purchase Price pursuant to one of the payment options provided in this
Section 2.B. Payment of the Purchase Price shall be made at the option of the
Holder by one or more of the following methods: (1) by delivery to the Company
of cash, a certified check or a bank cashier's check in an amount equal to the
then aggregate Purchase Price, (2) by instructing the Company to withhold a
number of Warrant Shares then issuable upon exercise of the particular Warrant
with an aggregate Fair Market Value (as defined below) equal to such Purchase
Price, or (3) by surrendering to the Company shares of Common Stock previously
acquired by the Holder with an aggregate Fair Market Value equal to such
Purchase Price, or any combination of the foregoing. Upon receipt thereof by the
Company, the Holder shall immediately be deemed to be a holder of record of the
shares of Common Stock specified in said subscription form, and the Company
shall, as promptly as practicable, and in any event within 10 business days
thereafter, execute and deliver or cause to be delivered to the Holder a
certificate or certificates representing the aggregate number of shares of
Common Stock specified in said subscription form. Each stock certificate so
delivered shall be registered in the name of such Holder or such other name as
shall be designated by such Holder, subject to compliance with federal and state
securities laws and Section 4 hereof. If the Warrant shall have been exercised
only in part, the Company shall, at the time of delivery of said stock
certificate or certificates, deliver to the Holder a Warrant in the form of this
Warrant representing the right to purchase the remaining number of shares
purchasable thereunder. The Company shall pay all expenses, taxes and other
charges payable in connection with the preparation, execution and delivery of
stock certificates pursuant to this Section 2, except that, in case such stock
certificates shall be registered in a name or names other than the name of the
Holder, funds sufficient to pay all stock transfer taxes which shall be payable
upon the execution and delivery of such stock certificate or certificates shall
be paid by the Holder to the Company at the time of delivering the Warrant to
the Company. As used herein "FAIR MARKET VALUE" on any day shall mean (i) the
average of the daily closing sale prices of the Common Stock during the 20
trading days immediately preceding the day as of which "FAIR MARKET VALUE" is
being determined, on the principal securities exchange on which the Common Stock
is then listed, or if there shall have been no sales of the Common Stock on such
exchange on such day, the mean of the closing bid and asked prices on such
exchange at the end of such day, or (ii) if the Common Stock is not so listed,
the average of the high and low bid and prices on such day in a domestic
over-the-counter market, or (iii) any time the Common Stock is not listed on any
domestic exchange or quoted in a domestic over-the-counter market, the "FAIR
MARKET VALUE" shall be determined by the Board of Directors of the Company.
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C. TRANSFER RESTRICTION LEGEND. Each Warrant shall bear the legends set
forth on the face of this Warrant. Each certificate for Warrant Shares issued
upon exercise or conversion of this Warrant, unless at the time of exercise or
conversion such Warrant Shares are registered under the Securities Act, shall
bear the legends described in Section 5.9 of the Purchase Agreement.
D. CHARACTER OF WARRANT SHARES. All shares of Common Stock issuable
upon the exercise of the Warrants shall be duly authorized, validly issued,
fully paid and nonassessable.
E. LIMITATION ON EXERCISE. Notwithstanding anything stated herein to
the contrary, unless and until the issuance and sale of the Series C Preferred
Stock and the Warrants are approved or ratified by the stockholders of the
Company in accordance with the rules of the Nasdaq Stock Market (the
"STOCKHOLDER APPROVAL"), the Series C Preferred Stock and the Warrants cannot be
converted into or exercised for (as the case may be) a total number of shares of
Common Stock equal to or greater than twenty percent (20%) of the number of
shares of Common Stock outstanding immediately prior to the issuance of the
Series C Preferred Stock and the Warrants (the "COMMON STOCK CAP"). The exercise
of the Warrants is expressly limited by and subject to this Section 2E for all
purposes unless and until the Stockholder Approval is obtained. Within the
Common Stock Cap, the exercise rights of the Warrants are subordinated to the
conversion rights of the Series C Preferred Stock, such that no Warrant may be
exercised if the number of shares of Common Stock into which the outstanding
shares of Series C Preferred Stock are convertible is equal to or exceeds the
Common Stock Cap. In the event the Common Stock Cap exceeds the number of shares
of Common Stock issuable upon conversion of the Series C Preferred Stock but
less than the number of shares of Common Stock into which the outstanding
Warrants are exercisable, the exercise right of the Warrants shall be reduced
pro rata among the outstanding Warrants. In no event shall the total number of
shares of Common Stock into which the Series C Preferred Stock is convertible
and the Warrants are exercisable exceed the Common Stock Cap prior to the
Stockholder Approval. Upon Stockholder Approval, the Common Stock Cap shall
terminate and the Warrants shall be exercisable in accordance with the terms
hereof excluding this Section 2E.
SECTION 3. OWNERSHIP AND EXCHANGE OF THE WARRANTS.
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A. REGISTERED HOLDER. The Company may deem and treat the person in
whose name each Warrant is registered as the Holder and owner thereof
(notwithstanding any notations of ownership or writing thereon made by anyone
other than the Company) for all purposes and shall not be affected by any notice
to the contrary, until presentation of such Warrant for exchange or transfer as
provided in this Section 3.
B. EXCHANGE AND REPLACEMENT. Any Warrant is exchangeable upon the
surrender thereof by the Holder to the Company at its Principal Office for a new
Warrant or Warrants of like tenor and date representing in the aggregate the
right to purchase the number of shares purchasable thereunder, each new Warrant
to represent the right to purchase such number of shares as shall be designated
by the Holder at the time of surrender. Subject to compliance with Section 4,
each Warrant and all rights thereunder are transferable in whole or in part upon
the books of the Company by the Holder thereof in person or by duly authorized
attorney, and a new Warrant shall be made and delivered by the Company, of the
same class, tenor and date as the Warrant but registered in the name of the
transferee, upon surrender of the Warrant, duly endorsed, at the Principal
Office of the Company. The Company will issue replacement Warrant certificates
upon the loss, theft, destruction or mutilation thereof. Warrants shall be
promptly canceled by the Company upon the surrender thereof in connection with
any exchange, transfer or replacement. The Company shall pay all expenses, taxes
(other than stock transfer taxes) and other charges payable in connection with
the preparation, execution and delivery of Warrants pursuant to this Section 3.
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SECTION 4. TRANSFER OF WARRANTS OR WARRANT SHARES. This Warrant and the
related Warrant Shares shall not be transferable except in accordance with the
terms and conditions specified in the Purchase Agreement and in accordance with
applicable law.
SECTION 5. ADJUSTMENT PROVISIONS. The aggregate number of shares of
Common Stock issuable upon exercise of the Warrants, and the Purchase Price per
share, shall be subject to adjustment in the events and to the extent set forth
in EXHIBIT I.
SECTION 6. NOTIFICATIONS BY THE COMPANY. The Holder shall be entitled
to notices of certain events related to the Company to the same extent and in
the same manner as the holders of the Series C Preferred Stock pursuant to the
terms of the Certificate of Designations of the Series C Preferred Stock.
SECTION 7. NOTICES. Any notice or other document required or permitted
to be given or delivered to Holders shall be delivered at, or sent by certified
or registered mail to each Holder at, the address set forth for such Holder on
the signature page hereof or to such other address as shall have been furnished
to the Company in writing by such Holder. Any notice or other document required
or permitted to be given or delivered to the Company shall be sent by certified
or registered mail to the Company, at its Principal Office, attention:
President, or other such address as shall have been furnished to the Holders by
the Company.
SECTION 8. NO RIGHTS AS STOCKHOLDER; LIMITATION OF LIABILITY. This
Warrant shall not entitle any Holder thereof to any of the rights of a
stockholder of the Company. No provision hereof, in the absence of affirmative
action by the Holder to purchase shares of Common Stock, and no enumeration
herein of the rights or privileges of the Holder of a Warrant, shall give rise
to any liability of such Holder for the Purchase Price or as a stockholder of
the Company, whether such liability is asserted by the Company or by creditors
of the Company.
SECTION 9. MISCELLANEOUS. This Warrant shall be governed by, and
construed and enforced in accordance with, the laws of the State of Delaware.
This Warrant and any provision hereof may be changed, waived, discharged or
terminated only by an instrument in writing signed by the party (or any
predecessor in interest thereof) against which enforcement of the same is
sought. The headings in this Warrant are for purposes of reference only and
shall not affect the meaning or construction of any of the provisions hereof.
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WITNESS the due execution of this Warrant by a duly authorized officer
of the Company.
AMEN PROPERTIES, INC.,
a Delaware corporation
By: /s/ Xxx X. Xxxxxx
-----------------------------------
Xxx X. Xxxxxx, President
ATTEST:
Secretary
ACCEPTED this 1st day of March, 2005:
Name:
---------------------------------------
Address:
-----------------------------------
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FULL SUBSCRIPTION FORM
____ To Be Executed by the Registered Holder
if He Desires to Exercise the Warrant in Full
The undersigned hereby exercises the right to purchase the __________
shares of Common Stock covered by the attached Warrant at the date of this
subscription and herewith makes payment of the sum of $____________ representing
the Purchase Price of $______________ per share in effect at this date.
Certificates for such shares shall be issued in the name of and delivered to the
undersigned, unless otherwise specified in written instructions signed by the
undersigned and accompanying this subscription.
Dated: _________, ____ [ ]
Signature
-------------------------------------
Address:
-------------------------------------
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PARTIAL SUBSCRIPTION FORM
___ To Be Executed by the Registered Holder
if He Desires to Exercise the Warrant in Part
The undersigned hereby exercises the right to purchase __________
shares of the total number of shares of Common Stock covered by the attached
Warrant at the date of this subscription and herewith makes payment of the sum
of $__________ representing the Purchase Price of __________ per share in effect
at this date. Certificates for such shares and a new Warrant of like tenor and
date for the balance of the shares not subscribed for shall be issued in the
name of and delivered to the undersigned, unless otherwise specified in written
instructions signed by the undersigned and accompanying this subscription.
(THE FOLLOWING PARAGRAPH NEED BE COMPLETED ONLY IF THE PURCHASE PRICE
AND NUMBER OF SHARES OF COMMON STOCK SPECIFIED IN THE ATTACHED WARRANT HAVE BEEN
ADJUSTED PURSUANT TO EXHIBIT I THEREOF.)
The shares hereby subscribed for constitute __________ shares of Common
Stock (rounded to the nearest whole share) resulting from adjustment of
______________ shares of the total of _______________ shares of Common Stock
covered by the attached Warrant, as said shares were constituted at the date of
the Warrant, leaving a balance of ________ shares of Common Stock, as
constituted at the date of the Warrant, to be covered by the new Warrant.
Dated: _________,____ [ ]
Signature
----------------------------------------
Address:
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EXHIBIT I
ANTI-DILUTION PROVISIONS
The number of Warrant Shares purchasable upon the exercise of this
Warrant and the Purchase Price shall be subject to adjustment from time to time
upon the happening of certain events as hereinafter described. Capitalized terms
used but not defined herein shall have the meanings assigned thereto in the
Warrant.
1. SPECIAL DEFINITIONS. For purposes of this EXHIBIT I, the following
definitions shall apply:
(A) "OPTION" shall mean rights, options or warrants to
subscribe for, purchase or otherwise acquire Common Stock or
Convertible Securities, excluding rights, options or shares granted or
issued to employees, vendors, officers, directors and executives of,
and consultants or shareholders to, the Company in an amount not
exceeding the number of Reserved Employee Shares.
(B) "ORIGINAL ISSUE DATE" shall mean the date of this Warrant.
(C) "CONVERTIBLE SECURITIES" shall mean any evidences of
indebtedness, shares or other securities directly or indirectly
convertible into or exchangeable for Common Stock, except for the
Series C Preferred Stock issued on the Original Issue Date.
(D) "ADDITIONAL SHARES OF COMMON STOCK" shall mean all shares
of Common Stock issued (or, pursuant to Section 3 below, deemed to be
issued) by the Company after the Original Issue Date, other than
Reserved Employee Shares and other than shares of Common Stock issued
or issuable:
(1) by reason of a stock dividend, stock split,
split-up or other distribution on shares of Common Stock;
(2) upon the exercise of Options;
(3) upon conversion of shares of Series C Preferred
Stock;
(E) "RESERVED EMPLOYEE SHARES" shall mean shares of Common
Stock issued to employees, officers, directors, shareholders and
executives of, and consultants or vendors to, the Company either
directly as compensation or upon the exercise of options granted by the
Company.
(F) "RIGHTS TO ACQUIRE COMMON STOCK" (or "RIGHTS") shall mean
all rights issued by the Company to acquire Common Stock whether by
exercise of a warrant, option or similar call, or conversion of any
existing instruments, in either case for consideration fixed, in amount
or by formula, as of the date of issuance.
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2. NO ADJUSTMENT OF CONVERSION PRICES. No adjustment in the number of
Warrant Shares shall be made (i) unless the consideration per share (determined
pursuant to Section 5 below) for an Additional Share of Common Stock issued or
deemed to be issued by the Company is less than the Purchase Price in effect on
the date of, and immediately prior to, the issue of such Additional Shares of
Common Stock, or (ii) if prior to such issuance, the Company receives written
consent from the holders of at least a majority of the voting power of all then
outstanding Warrants agreeing that no such adjustment shall be made as the
result of the issuance of Additional Shares of Common Stock.
3. ISSUE OF SECURITIES DEEMED ISSUE OF ADDITIONAL SHARES OF COMMON
STOCK. If the Company at any time or from time to time after the Original Issue
Date shall issue any Options or Convertible Securities or Rights to Acquire
Common Stock, then the maximum number of shares of Common Stock (as set forth in
the instrument relating thereto without regard to any provision contained
therein for a subsequent adjustment of such number) issuable upon the exercise
of such Options, Rights or, in the case of Convertible Securities, the
conversion or exchange of such Convertible Securities, shall be deemed to be
Additional Shares of Common Stock issued as of the time of such issue; provided,
however, that Additional Shares of Common Stock shall not be deemed to have been
issued unless the consideration per share (determined pursuant to Section 5
hereof) of such Additional Shares of Common Stock would be less than the
Purchase Price in effect on the date of and immediately prior to such issue, or
such record date, as the case may be, and provided, further, that in any such
case:
(A) No further adjustment in the Purchase Price shall be made
upon the subsequent issue of shares of Common Stock upon the exercise
of such Options, Rights or conversion or exchange of such Convertible
Securities;
(B) Upon the expiration or termination of any unexercised
Option, Right or Convertible Security, the Purchase Price shall be
adjusted immediately to reflect the Purchase Price which would have
been in effect had such Option, Right or Convertible Security (to the
extent outstanding immediately prior to such expiration or termination)
never been issued; and
(C) In the event of any change in the number of shares of
Common Stock issuable upon the exercise, conversion or exchange of any
Option, Right or Convertible Security, including, but not limited to, a
change resulting from the anti-dilution provisions thereof, the
Purchase Price then in effect shall forthwith be readjusted to such
Purchase Price as would have been obtained had the Purchase Price
adjustment that was originally made upon the issuance of such Option,
Right or Convertible Security which were not exercised or converted
prior to such change been made upon the basis of such change, but no
further adjustment shall be made for the actual issuance of Common
Stock upon the exercise or conversion of any such Option, Right or
Convertible Security.
4. ADJUSTMENT OF CONVERSION PRICES UPON ISSUANCE OF ADDITIONAL SHARES
OF COMMON STOCK. If the Company shall at any time after the Original Issue Date
issue Additional Shares of Common Stock (including Additional Shares of Common
Stock deemed to be issued pursuant to Section 3, but excluding shares issued as
a dividend or distribution as provided in Section 7 or upon a stock split or
combination as provided in Section 6), without consideration, or for a
consideration per share less than the Purchase Price in effect on the date of
and immediately prior to such issue, or without the requisite consent
contemplated by Section 2 hereof, then and in such event, the Purchase Price
shall be reduced by a full ratchet anti-dilution adjustment to such lesser price
(calculated to the nearest cent), but in no case will the Purchase Price be
reduced below $2.80 per share, concurrently with such issuance at a price less
than the original Purchase Price. Notwithstanding the foregoing, the applicable
Purchase Price shall not be reduced if the amount of such reduction would be an
amount less than $.20, but any such amount shall be carried forward and
reduction with respect thereto made at the time of and together with any
subsequent reduction which, together with such amount and any other amount or
amounts so carried forward, shall aggregate $.20 or more.
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5. DETERMINATION OF CONSIDERATION. For purposes of this Exhibit I, the
consideration received by the Company for the issue of any Additional Shares of
Common Stock shall be computed as follows:
(A) CASH AND PROPERTY. Such consideration shall:
(1) insofar as it consists of cash, be computed at
the aggregate of cash received by the Company, excluding
amounts paid or payable for accrued interest or accrued
dividends;
(2) insofar as it consists of property other than
cash, be computed at the fair market value thereof at the time
of such issue, as determined in good faith by the Board; and
(3) in the event Additional Shares of Common Stock
are issued together with other shares or securities or other
assets of the Company for consideration which covers both, be
the proportion of such consideration so received, computed as
provided in clauses (1) and (2) above, as determined in good
faith by the Board.
(B) OPTIONS, RIGHTS AND CONVERTIBLE SECURITIES. The
consideration per share received by the Company for Additional Shares
of Common Stock deemed to have been issued pursuant to Section 3,
relating to Options, Rights and Convertible Securities, shall be
determined by dividing
(1) the total amount, if any, received or receivable
by the Company as consideration for the issue of such Options,
Rights or Convertible Securities, plus the minimum aggregate
amount of additional consideration (as set forth in the
instruments relating thereto, without regard to any provision
contained therein for a subsequent adjustment of such
consideration) payable to the Company upon the exercise of
such Options, Rights or the conversion or exchange of such
Convertible Securities, by
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(2) the maximum number of shares of Common Stock (as
set forth in the instruments relating thereto, without regard
to any provision contained therein for a subsequent adjustment
of such number) issuable upon the exercise of such Options,
Rights or the conversion or exchange of such Convertible
Securities.
6. ADJUSTMENT FOR STOCK SPLITS AND COMBINATIONS. If the Company shall
at any time or from time to time after the Original Issue Date effect a
subdivision of the outstanding Common Stock, the Purchase Price then in effect
immediately before that subdivision shall be proportionately decreased. If the
Company shall at any time or from time to time after the Original Issue Date
combine the outstanding shares of Common Stock, the Purchase Price then in
effect immediately before the combination shall be proportionately increased.
Any adjustment under this paragraph shall become effective at the close of
business on the date the subdivision or combination becomes effective.
7. ADJUSTMENT FOR CERTAIN DIVIDENDS AND DISTRIBUTIONS. In the event the
Company at any time or from time to time after the Original Issue Date shall
make or issue a dividend or other distribution payable in shares of Common
Stock, then and in each such event the Purchase Price shall be decreased as of
the time of such issuance, by multiplying the Purchase Price by a fraction, the
numerator of which shall be the total number of shares of Common Stock issued
and outstanding immediately prior to the time of such issuance, and the
denominator of which shall be the total number of shares of Common Stock issued
and outstanding immediately prior to the time of such issuance plus the number
of shares of Common Stock issuable in payment of such dividend or distribution.
8. ADJUSTMENTS FOR OTHER DIVIDENDS AND DISTRIBUTIONS. In the event the
Company at any time, or from time to time after the Original Issue Date shall
make or issue, a dividend or other distribution payable in securities of the
Company other than shares of Common Stock, then and in each such event provision
shall be made so that the Holders shall receive upon exercise of the Warrant in
addition to the number of shares of Common Stock receivable thereupon, the
amount of securities of the Company that they would have received had the
Warrants been exercised into Warrant Shares on the date of such event and had
thereafter retained such securities receivable by them as aforesaid during such
period given application to all adjustments called for during such period, under
this paragraph with respect to the rights of the Holders.
9. ADJUSTMENT FOR RECLASSIFICATION, EXCHANGE, OR SUBSTITUTION. If the
Warrant Shares shall be changed into the same or a different number of shares of
any class or classes of stock, whether by capital reorganization,
reclassification, or otherwise (other than a subdivision or combination of
shares or stock dividend provided for above), then and in each such event the
Holder shall have the right thereafter to convert such share into the kind and
amount of shares of stock and other securities and property receivable upon such
reorganization, reclassification, or other change, by holders of the number of
shares of Common Stock into which the Warrant might have been exercised
immediately prior to such reorganization, reclassification, or change, all
subject to further adjustment as provided herein.
10. NO IMPAIRMENT. The Company will not, by amendment of its
Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Company, but will at all
times in good faith assist in the carrying out of all the provisions of this
EXHIBIT I and in the taking of all such action as may be necessary or
appropriate in order to protect the exercise rights of the Holders against
impairment to the extent required hereunder.
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11. CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment of the Purchase Price pursuant to this EXHIBIT I, the
Company at its expense shall promptly compute such adjustment or readjustment in
accordance with the terms hereof and shall file a certificate setting forth such
adjustment or readjustment and showing in detail the facts upon which such
adjustment or readjustment is based with its corporate records. The Company
shall, upon the reasonable written request of any Holder furnish or cause to be
furnished to such Holder a similar certificate setting forth (i) such
adjustments and readjustments, (ii) the Purchase Price then in effect, and (iii)
the number of shares of Common Stock and the amount, if any, of other property
which then would be received upon the exercise of this Warrant. Despite such
adjustment or readjustment, the form of each or all Warrants, if the same shall
reflect the initial or any subsequent Purchase Price, need not be changed in
order for the adjustments or readjustments to be valid in accordance with the
provisions of this Warrant, which shall control.
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