THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR ANY STATE SECURITIES
LAWS. THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF
HAVE BEEN OR WILL BE ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO
DISTRIBUTION OR RESALE, AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED
WITHOUT COMPLIANCE WITH THE REGISTRATION OR QUALIFICATION PROVISIONS OF
APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR APPLICABLE EXEMPTIONS
THEREFROM.
AEGIS COMMUNICATIONS GROUP, INC.
WARRANT TO PURCHASE SHARES
OF COMMON STOCK
Date of Issuance: April 21, 2004 Certificate No. W-8
THIS CERTIFIES THAT, for value received, Essar Global Limited (the "Purchaser")
and its assigns are entitled to subscribe for and purchase 230,248,285 shares
(such number and such other number as shall result, from time to time, from the
adjustments specified in Section 6 hereof is herein referred to as the "Number
of Warrant Shares") of duly authorized, validly issued, fully paid and
nonassessable Common Stock (as adjusted pursuant to Section 6 hereof, the
"Shares") of AEGIS COMMUNICATIONS GROUP, INC., a Delaware corporation (the
"Company"), at the price of $0.01 per share (such price and such other price as
shall result, from time to time, from the adjustments specified in Section 6
hereof is herein referred to as the "Exercise Price"), subject to the provisions
and upon the terms and conditions hereinafter set forth. As used herein the term
"Date of Grant" shall mean November 5, 2003. The term "Warrant" as used herein
shall be deemed to include any warrants issued upon transfer or partial exercise
of this Warrant unless the context clearly requires otherwise. Capitalized terms
used but not otherwise defined herein shall have the respective meanings
ascribed to them in the Note and Warrant Purchase Agreement dated as of November
5, 2003 between the Company, Deutsche Bank AG-London acting through DB Advisors,
LLC as investment advisor and the Purchaser (the "Purchase Agreement").
1. Term. The purchase right represented by this Warrant is exercisable by
the holder hereof, in whole or in part, at any time and from time to time from
the Date of Grant through November 5, 2010 (as such date may be extended as
provided below, the "Expiration Date"). Notwithstanding the foregoing, the
Expiration Date of this Warrant may be extended if, on the Expiration Date, (i)
there is no effective Registration Statement (as defined in the Registration
Rights Agreement) covering all of the Registrable Securities (as defined in the
Registration Rights Agreement) or (ii) a Blackout Period (as defined in the
Registration Rights Agreement) is then in effect, then in either of those
events, the Expiration Date and the Principal Payment Date shall be
automatically extended until such time as a Registration Statement covering all
of the Registrable Securities has been declared effective and/or there is no
Blackout Period in effect.
2. Method of Exercise.
(a) Cash and Other Exercise. Subject to Sections 1 and 5 hereof, the
purchase right represented by this Warrant may be exercised by the holder
hereof, in whole or in part and from time to time, at the election of the holder
hereof, by (i) the surrender of this Warrant (with the notice of exercise
substantially in the form attached hereto as Exhibit A-1 duly completed and
executed) at the principal office of the Company and the payment to the Company
by wire transfer to an account designated by the Company (a "Wire Transfer") of
an amount equal to the then applicable Exercise Price multiplied by the number
of Shares then being purchased, or (ii) if in connection with a registered
public offering of the Common Stock, the surrender of this Warrant (with the
notice of exercise form attached hereto as Exhibit A-2 duly completed and
executed) at the principal office of the Company together with notice of
arrangements reasonably satisfactory to the Company for payment to the Company
by Wire Transfer from the proceeds of the sale of such number of Shares to be
sold by the holder hereof in such public offering of an amount equal to the then
applicable Exercise Price per share multiplied by the number of Shares then
being purchased, or (iii) the tender of all or a portion of the Note issued by
the Company pursuant to the Purchase Agreement in a principal amount equal to
the then applicable Exercise Price multiplied by the number of Shares then being
purchased.
(b) Cashless Exercise. Subject to Sections 1 and 5 hereof, in lieu of
exercising this Warrant pursuant to Section 2(a), the holder of this Warrant may
elect to receive, without the payment by the holder of any additional
consideration, Shares equal to the value of this Warrant (or the portion hereof
being canceled), together with any cash in lieu of fractional Shares, by
surrender of this Warrant at the principal office of the Company together with
an executed Notice of Exercise or Exchange in substantially the form attached
hereto as Exhibit A-1 or Exhibit A-2. In such event, the number of Shares that
the Company shall issue to the holder hereof shall be computed using the
following formula:
Y (A - B)
---------
X = A
Where: X = The adjusted number of Shares to be issued to the Holder
as a result of the cashless exchange election under this
Section 2(b);
Y = The number of Shares in respect of which the cashless
exchange election under this Section 2(b) is made;
A = The Fair Market Value of one Share at the time the
cashless exchange election is made; and
B = The Exercise Price.
3. Certificates for Shares. Within three Business Days after the exercise
of the purchase rights evidenced by this Warrant, one or more certificates for
the number of Shares so purchased shall be issued to the holder or as the holder
may direct (with appropriate restrictive legends, as applicable). In the event
of a partial exercise of this Warrant, a new warrant or warrants (dated the date
hereof) of like tenor shall be issued to the holder or, subject to the
limitations set forth herein, as
2
the holder may direct (with appropriate restrictive legends, as applicable), for
the aggregate number of Shares equal to the number of Shares called for on the
face of this Warrant minus the number of Shares purchased by the holder hereof
upon such partial exercise. For all purposes of this Warrant other than Sections
2(a) and 2(b), any reference to the exercise of this Warrant shall be deemed to
include a reference to the cashless exchange of the Warrant into Common Stock,
in accordance with the terms of Section 2(b) and this Section 3. The Company
shall pay all of its expenses associated with the issuance of any Shares and
replacement Warrants in accordance with the terms hereof, including, without
limitation, any applicable issue taxes.
4. Stock Fully Paid; Reservation of Shares. All Shares that may be issued
upon the exercise of the rights represented by this Warrant will, upon issuance
pursuant to the terms and conditions herein, be duly and validly issued and
fully paid and nonassessable, and free from all preemptive rights, taxes, liens
and charges with respect to the issuance thereof. During the period within which
the rights represented by this Warrant may be exercised, the Company will at all
times have authorized, and reserved for the purpose of the issuance upon
exercise of the purchase rights evidenced by this Warrant, a sufficient number
of shares of its Common Stock to provide for the exercise of the rights
represented by this Warrant.
5. Xxxx-Xxxxx-Xxxxxx. If any filing or notification becomes necessary
pursuant to the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended
(the "HSR Act"), based upon the planned exercise of this Warrant or any portion
hereof, the holder hereof shall notify the Company of such requirement, and the
holder and the Company shall file with the proper authorities all forms and
other documents necessary to be filed pursuant to the HSR Act, as promptly as
possible and shall cooperate with each other in promptly producing such
additional information as those authorities may reasonably require to allow
early termination of the notice period provided by the HSR Act or as otherwise
necessary to comply with requirements of the Federal Trade Commission or the
Department of Justice. The holder and the Company agree to cooperate with each
other in connection with such filings and notifications, and to keep each other
informed of the status of the proceedings and communications with the relevant
authorities. The holder shall pay any filing fee required to be paid in
connection with a filing pursuant to the HSR Act required as a result of the
exercise of Warrants. Notwithstanding the preceding sentence, the Company shall
pay all such filing fees required to be paid in connection with any filing
pursuant to the HSR Act required as a result of the exercise of Warrants held by
the Purchaser or its Affiliates (but not other successors or assigns of the
Purchaser). The holder and the Company shall each bear its own expenses (other
than such filing fees) incurred in connection with any filing required pursuant
to the HSR Act. Each holder by acceptance of this Warrant or any portion hereof
agrees to comply with the provisions of this Section 5.
6. Adjustment of Exercise Price and Number of Warrant Shares. The Number of
Warrant Shares and the Exercise Price shall be subject to adjustment from time
to time, but without duplication, upon the occurrence of certain events, as
follows:
(a) Subdivisions, Combinations and Other Issuances. Prior to the
exercise or expiration of this Warrant, if the Company shall: (i) subdivide its
outstanding shares of Common Stock into a larger number of shares of Common
Stock by stock split or otherwise, (ii) combine its outstanding shares of Common
Stock into a smaller number of shares of Common Stock by reverse stock split or
otherwise or (iii) issue additional shares of Common Stock or other capital
stock as a
3
dividend or distribution on or with respect to its Common Stock, the Exercise
Price in effect prior to such subdivision, combination or issuance shall
forthwith be proportionately decreased in the case of a subdivision or stock
dividend or distribution, or proportionately increased in the case of a
combination and the Number of Warrant Shares in effect prior to such
subdivision, combination or issuance shall forthwith be proportionately
increased in the case of a subdivision, stock dividend or distribution, or
proportionately decreased in the case of a combination. Any adjustment under
this Section 6(a) shall become effective at the close of business on the date
the subdivision, combination or reclassification becomes effective, or as of the
record date of such dividend or distribution (provided the Company makes such
dividend or distribution), or in the event that no record date is fixed, upon
the making of such dividend or distribution.
(b) Reclassification, Reorganization, Consolidation, etc. In the event
of any corporate reclassification, capital reorganization, consolidation,
spin-off, merger, transfer of all or a substantial portion of the Company's
properties or assets or any dissolution, liquidation or winding up of the
Company (other than as a result of a subdivision, combination, dividend or
distribution provided for in Section 6(a) above) (a "Corporate Transaction"),
then, as a condition of such event, provision shall be made, and duly executed
documents evidencing the same from the Company and any surviving or acquiring
Person (the "Successor Company") shall be delivered to the holder hereof, so
that the holder shall have the right to receive upon exercise of this Warrant
the same number of shares of Common Stock and amount of cash and other property
that such holder would have been entitled to receive upon such Corporate
Transaction had this Warrant been exercised immediately prior to the effective
date of such Corporate Transaction. The Company shall provide that any Successor
Company in such Corporate Transaction shall enter into an agreement with the
Company confirming the holder's rights pursuant to this Warrant, assuming the
Company's obligations under this Warrant, jointly and severally with the Company
if the Company shall survive such Corporate Transaction, and providing after the
date of such Corporate Transaction for adjustments, which shall be as nearly
equivalent as possible to the adjustments provided for in this Section 6. The
provisions of this Section 6(b) shall apply similarly to successive Corporate
Transactions involving any Successor Company. In the event of a Corporate
Transaction in which consideration payable to holders of Common Stock is payable
solely in cash, then the holder shall be entitled to receive in exchange for
this Warrant cash in an amount equal to the amount such holder would have
received had the holder exercised this Warrant immediately prior to such
Corporate Transaction, less the aggregate Exercise Price for this Warrant then
in effect. In case of any Corporate Transaction described in the immediately
preceding sentence of this Section 6(b), the Company or any Successor Company,
as the case may be, shall make available any funds necessary to pay to the
holder the amount to which the holder is entitled as described above in the same
manner and at the same time as holders of Common Stock would be entitled to such
funds.
(c) Issuance of Additional Shares of Common Stock. In the event the
Company at any time or from time to time shall, or shall be deemed to, issue or
sell Additional Shares of Common Stock, other than Excluded Stock, for
consideration per share received by the Company of less than the Current Market
Price, then, and in each such case, the Exercise Price for any Warrant shall be
decreased to an amount determined by dividing the previously applicable Exercise
Price by a fraction, (A) the numerator of which shall be the sum of (i) the
number of shares of Common Stock outstanding immediately prior to such issuance
or sale, plus (ii) the number of Additional Shares of Common Stock issued or
sold or deemed to be issued or sold, and (B) the denominator of which shall be
the sum of (x) the number of shares of Common Stock outstanding immediately
prior to
4
such issuance or sale, plus (y) the number of shares of Common Stock which the
aggregate consideration received by the Company for the Additional Shares of
Common Stock so issued or sold or deemed to be issued or sold would purchase at
the Current Market Price; provided, however, that if at such time or as a result
of such adjustment the Exercise Price for any Warrant is or would be, as the
case may be, equal to or less than $0.01 per share, then in lieu of the
adjustment of the Exercise Price the Number of Warrant Shares purchasable upon
exercise of this Warrant shall be increased to a number determined by
multiplying the previously applicable number of Shares purchasable upon exercise
of this Warrant by a fraction, (A) the numerator of which shall be the sum of
(i) the number of shares of Common Stock outstanding immediately prior to such
issuance or sale, plus (ii) the number of Additional Shares of Common Stock
issued or sold or deemed to be issued or sold, and (B) the denominator of which
shall be the sum of (x) the number of shares of Common Stock outstanding
immediately prior to such issuance or sale, plus (y) the number of shares of
Common Stock which the aggregate consideration received by the Company for the
Additional Shares of Common Stock so issued or sold or deemed to be issued or
sold would purchase at the Current Market Price.
(d) Options and Convertible Securities.
(i) In the event that the Company at any time or from time to time
issues, sells, grants or assumes, or fixes a record date for the determination
of holders of any class of securities entitled to receive, any Options or
Convertible Securities, other than Excluded Stock, then, and in each such case,
the number of shares of Common Stock at any time issuable upon the exercise of
such Options and/or the conversion or exchange of such Convertible Securities,
as the case may be, shall be deemed to be Additional Shares of Common Stock
issued as of the close of business on the date of the earliest of such issuance,
sale, grant, assumption or record date.
(ii) If any Options or Convertible Securities provide, with the
passage of time or otherwise, for any decrease or increase, as the case may be,
in (A) the consideration payable to the Company or for which such Options or
Convertible Securities are exercisable, convertible or exchangeable, or (B) the
number of Additional Shares of Common Stock issuable upon the exercise and/or
conversion or exchange thereof, then the Exercise Price for this Warrant shall
be adjusted upon any such decrease or increase becoming effective to reflect
such decrease or increase insofar as it affects any such Options or Convertible
Securities which are outstanding at such time, as if such Options or Convertible
Securities included such terms as adjusted upon their original issuance, sale,
grant, assumption or record date, as the case may be; provided, however, that no
adjustments relating to any Options or Convertible Securities pursuant to this
subsection, individually or in the aggregate, shall increase the Exercise Price
for this Warrant by more than all previous reductions in the Exercise Price for
such Warrant relating to the same Options or Convertible Securities.
(iii) In any case in which Additional Shares of Common Stock are
deemed to be issued, sold, granted or assumed, no further adjustment of the
Exercise Price shall be made upon the exercise of such Options or the conversion
or exchange of such Convertible Securities and the consequent issue or sale of
Convertible Securities or shares of Common Stock.
(iv) Upon (x) the expiration, or the repurchase and cancellation
or retirement by the Company, of any Options which have not been exercised, or
(y) the expiration of any rights of conversion or exchange under any Convertible
Securities which have not been
5
exercised, or the repurchase and cancellation or retirement by the Company of
any such Convertible Securities the rights of conversion or exchange of which
have not been exercised, any adjustments to the Exercise Price computed upon the
original issuance, sale, grant, assumption or record date, and upon any
subsequent adjustments to such Options or Convertible Securities, shall,
effective as of such expiration, cancellation or retirement, as the case may be,
be recomputed as if: (i) the only Additional Shares of Common Stock (including,
without limitation, pursuant to the issuance or sale of Options or Convertible
Securities) issued or sold were the Additional Shares of Common Stock
(including, without limitation, pursuant to the issuance or sale of Options or
Convertible Securities), if any, actually issued or sold upon the exercise of
such Options or upon the conversion or exchange of such Convertible Securities;
(ii) in the case of Options, the consideration received therefor was the
consideration actually received by the Company for the issuance, sale, grant or
assumption of such Options, whether or not exercised, plus the consideration
actually received by the Company upon such exercise, plus, in the case of
Options for Convertible Securities, any additional consideration deemed to be
received by the Company upon the issuance and upon any conversion or exchange of
such Convertible Securities for which Options were exercised; and (iii) in the
case of Convertible Securities, the consideration received therefor was the
consideration actually received by the Company for the issuance, sale, grant or
assumption of such Convertible Securities which were actually converted or
exchanged, plus the additional consideration, if any, actually received by the
Company upon such conversion or exchange; provided, however, that no adjustments
relating to any Options or Convertible Securities pursuant to this subsection,
individually or in the aggregate, shall increase the Exercise Price by more than
all previous reductions in the Exercise Price relating to the same Options or
Convertible Securities.
(e) Consideration.
(i) For purposes of this Section 6, the consideration for the
issuance, sale, grant or assumption of any Additional Shares of Common Stock,
irrespective of the accounting treatment of such consideration, shall equal:
(1) insofar as it consists of cash, the amount of cash paid in
consideration for the issuance, sale, grant or assumption of such Additional
Shares of Common Stock, without giving effect to customary expenses, commissions
or other compensation paid by the Company and customary concessions or discounts
allowed by the Company to underwriters, dealers or others performing similar
services in connection with any such issuance, sale, grant or assumption;
(2) insofar as it consists of property (including, without
limitation, securities) other than cash actually received by the Company as
direct consideration for the issuance, sale, grant or assumption or such
Additional Shares of Common Stock, the Fair Market Value thereof at the time of
such issuance, sale, grant or assumption;
(3) insofar as it consists of other property or consideration,
including the provision of services to the Company, the Fair Market Value of
such other property or consideration; and
6
(4) in the event Additional Shares of Common Stock are issued
or sold together with other securities or property for a consideration which
covers both, the portion of such consideration so received, computed as provided
in clauses (1), (2) and (3) above, allocable to such Additional Shares of Common
Stock (as reasonably determined by the Board of Directors of the Company in good
faith, as evidenced by a written board resolution delivered to the holder
hereof).
(ii) Additional Shares of Common Stock deemed to have been issued,
sold, granted or assumed pursuant to Section 6(d) hereof shall be deemed to have
been issued, sold, granted or assumed for consideration per share equal to the
quotient of: (A) the total amount of cash and other property, if any, received
by the Company as direct consideration for the issuance, sale, grant or
assumption of the Options or Convertible Securities in question, plus the
aggregate amount of additional consideration (as set forth in the instruments
relating thereto) payable to the Company upon the exercise of such Options or
the conversion or exchange of such Convertible Securities or, in the case of
Options for Convertible Securities, the exercise of such Options and the
conversion or exchange of such Convertible Securities, divided by (B) the number
of shares of Common Stock (as set forth in the instruments relating thereto)
issuable upon the exercise of such Options and the conversion or exchange of
such Convertible Securities.
(f) Dividends and Distributions. In the event that the Company at any
time or from time to time declares, orders, pays or makes any dividend or other
distribution on the Common Stock, including, without limitation, distributions
of cash, evidence of its indebtedness, Options, Convertible Securities, other
securities or property or rights to subscribe for or purchase any of the
forgoing, and whether by way of dividend, spin-off, reclassification,
recapitalization, similar corporate reorganization or otherwise, other than a
dividend or distribution payable in Additional Shares of Common Stock that gives
rise to an adjustment pursuant to Section 6(a) hereof, then, and in each such
case, the Exercise Price of this Warrant shall be reduced to a number determined
by dividing the previously applicable Exercise Price by a fraction (which must
be less than 1, otherwise no adjustment is to be made pursuant to this Section
6(f)) (A) the numerator of which shall be the Fair Market Value per share of
Common Stock on the record date for such dividend or other distribution, and (B)
the denominator of which shall be the excess, if any, of (x) such Fair Market
Value per share of Common Stock, over (y) the sum of the amount of any cash
distributed per share of Common Stock plus the positive Fair Market Value, if
any, per share of Common Stock of any such evidences of indebtedness, Options,
Convertible Securities, other securities or property or rights to be so
distributed. Such adjustments shall be made whenever any such dividend or other
distribution is made and shall become effective as of the date of such
distribution, retroactive to the record date therefor.
(g) Other Events. If any event occurs as to which the provisions of
this Section 6 are not strictly applicable or if strictly applicable would not
fairly protect the purchase rights of the holder hereof in accordance with such
provisions, then the Board of Directors of the Company shall make an adjustment
in the number of Shares available under this Warrant, the Exercise Price, or the
applicability of such provisions so as to protect such purchase rights. The
adjustment shall be such as will give the holder hereof upon exercise for the
same aggregate Exercise Price the total number of shares of Common Stock as the
holder would have owned had this Warrant been exercised prior to the event and
had the holder continued to hold such Common Stock until after the event
requiring
7
the adjustment, but in no event shall any such adjustment have the effect of
increasing the Exercise Price.
(h) Minimum Adjustment. The adjustments required by the preceding
subsections of this Section 6 shall be made whenever and as often as any
specified event requiring an adjustment shall occur, except that no adjustment
of the Exercise Price or the number of Shares purchasable upon exercise of this
Warrant that would otherwise be required shall be made unless and until such
adjustment either by itself or with other adjustments not previously made
decreases the Exercise Price immediately prior to the making of such adjustment
by at least $0.01 or increases or decreases the number of Shares purchasable
upon exercise of this Warrant immediately prior to the making of such adjustment
by at least one Share. Any adjustment representing a change of less than such
minimum amount shall be carried forward and made as soon as such adjustment,
together with other adjustments required by this Section 6 and not previously
made, would result in the requisite minimum adjustment.
(i) Accountants' Report as to Adjustments. In the case of any
adjustment in the number of Shares purchasable upon exercise of this Warrant or
the Exercise Price, the Company, at its sole expense, shall promptly (i) compute
such adjustment in accordance with the terms of this Warrant and, if the holder
hereof so requests in writing from the Company within 30 days of receipt of such
computations from the Company, cause independent certified public accountants of
recognized national standing to verify such computation (other than any
determination of the Fair Market Value of Common Stock or the fair market value
of any other property); (ii) prepare a report setting forth such adjustment and
showing in reasonable detail the method of calculation thereof and the facts
upon which such adjustment is based, including, without limitation, (a) the
event or events giving rise to such adjustment; (b) the consideration received
by the Company for any Additional Shares of Common Stock issued or sold or
deemed to have been issued or sold; (c) the number of shares of Common Stock
outstanding or deemed to be outstanding prior and subsequent to any such
transaction; (d) the method by which any such adjustment was calculated
(including a description of the basis on which the Board of Directors of the
Company made any determination of Fair Market Value or fair market value
required thereby); and (e) the number of Shares purchasable upon exercise of
this Warrant and the Exercise Price in effect immediately prior to such event or
events and as adjusted; (iii) mail a copy of each such report to the holder
hereof and, upon the request at any time of the holder hereof, furnish to the
holder a like report setting forth the number of Shares purchasable upon
exercise of this Warrant and the Exercise Price at the time in effect and
showing in reasonable detail how they were calculated; and (iv) keep copies of
all such reports available at the principal office of the Company for inspection
during normal business hours by the holder or any prospective purchaser of this
Warrant designated by the holder hereof.
(j) No Dilution or Impairment. The Company shall not, by amendment of
its certificate of incorporation or other organizational document or through any
sale or other issuance of securities, capital reorganization, reclassification,
recapitalization, consolidation, merger, transfer of assets, dissolution,
liquidation, winding-up, any similar transaction or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all
terms hereunder and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the holder hereof against dilution
or other impairment. Without limiting the generality of the foregoing, the
Company (a) will not permit the par value of any shares of Common Stock
receivable upon the exercise of this
8
Warrant to exceed the Exercise Price and (b) will take all such action as may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable shares of Common Stock upon the exercise of this
Warrant by the holder hereof. Without limiting the generality of the foregoing,
before taking any action that would cause a reduction of the Exercise Price
pursuant to Section 6 hereof below the then par value (if any) of the Common
Stock, the Company shall take any and all corporate action (including, without
limitation, a reduction in par value) which shall be necessary to validly and
legally issue fully paid and nonassessable shares of Common Stock, as the case
may be, at the Exercise Price as so reduced.
(k) Contest and Appraisal Rights. If the holder hereof shall, in good
faith, disagree with any determination by the Board of Directors of the Company
of the Fair Market Value made pursuant to this Warrant, and such disagreement is
in respect of securities not traded on a national securities exchange or quoted
on an automated quotation system or other property valued by the Board of
Directors of the Company at more than $100,000 then the holder may by notice to
the Company (an "Appraisal Notice"), given within 30 days after notice to the
holder hereof following such determination, elect to contest such determination;
provided, however, that the holder hereof may not seek appraisal of any
determination of Fair Market Value to the extent that the Company has received a
fairness opinion or other appraisal from an Appraiser in connection with the
transaction giving rise to such determination. Within 20 days after an Appraisal
Notice, the Company shall engage an Appraiser to make an independent
determination of such Fair Market Value (the "Appraiser's Determination"), and
to deliver to the Company and the holder hereof a report describing its
methodology and results in reasonable detail within 30 days of such engagement.
In arriving at its determination, the Appraiser shall base any valuation upon:
(i) in the case of the Fair Market Value of shares of Common Stock, the fair
market value of the Company and its Subsidiaries on the basis of an arm's length
sale of a going concern between an informed and willing buyer and an informed
and willing seller, under no compulsion to buy or sell, taking into account all
the relevant facts and circumstances then prevailing, and without consideration
of (x) the lack of an actively trading public market for the Common Stock, (y)
any restrictions on the transfer of shares of Common Stock, or (z) any control
premium or minority discount, and (ii) in the case of the Fair Market Value of
any other property, the fair market value of such other property assuming that
such other property was sold in an arm's length transaction between an informed
and willing buyer and an informed and willing seller, under no compulsion to buy
or sell, taking into account all the relevant facts and circumstances then
prevailing. The holder hereof shall be afforded reasonable opportunities to
discuss the appraisal with the Appraiser. The Appraiser's Determination shall be
final and binding on the Company and the holders hereof, absent manifest error.
The costs of conducting an appraisal shall be borne by the Company.
7. Notice of Corporate Action. In the event the Company proposes to: (i)
pay, distribute, or take a record of the holders of any class of securities for
the purpose of determining the holders thereof who are entitled to receive any
dividend or other distribution, or any right to subscribe for, purchase or
otherwise acquire any shares of capital stock or any other securities or
property; or (ii) consummate any capital reorganization, reclassification,
recapitalization, consolidation, merger, transfer of all or substantially all of
its assets, dissolution, liquidation or winding-up, or any similar transaction;
then, at least 10 days prior to the earlier of any applicable record date or
such event, as the case may be, the Company shall deliver to the holder hereof a
notice specifying: (a) the date or expected date on which any such payment or
distribution is to be made or record is to be taken and the amount and character
of any such dividend, distribution or
9
right; (b) the date or expected date on which any such reorganization,
reclassification, recapitalization, consolidation, merger, transfer,
dissolution, liquidation, winding-up or similar transaction is to take effect
and any record date therefor; (c) the time as of which any holders of record of
shares of Common Stock and/or any other class of securities shall be entitled to
exchange their shares of Common Stock and/or other securities for the securities
or other property deliverable upon such reorganization, reclassification,
recapitalization, consolidation, merger, transfer, dissolution, liquidation,
winding-up or similar transaction and a description in reasonable detail of such
transaction; and (d) in each case, the expected effect on the number of Shares
purchasable upon exercise of this Warrant and the Exercise Price of each such
transaction or event. The Company shall update any such notice to reflect any
change in the foregoing information.
8. No Fractional Shares. No fractional shares of Common Stock shall be
issued in connection with any exercise hereunder, but in lieu of such fractional
shares the Company shall make a cash payment therefor based on the Fair Market
Value thereof.
9. Other Antidilution Provisions. The Company covenants not to issue, sell,
grant or assume any securities (including, without limitation, any Additional
Shares of Common Stock or rights to acquire Additional Shares of Common Stock)
to any Person (other than the Purchaser, Deutsche Bank AG-London acting through
DB Advisors, LLC as investment advisor or any of their transferees), which, in
the aggregate, provide for greater or more favorable antidilution protection
than the antidilution protection provided for in Section 6 hereof. For the
avoidance of doubt, a different exercise price or trigger price for the
application of such rights (including any such price based on fair market value)
shall not by itself be considered more favorable; provided, however, that a
trigger price for antidilution protection that is 120% or more of the Fair
Market Value of shares of Common Stock at the time of issuance of such
securities shall be considered more favorable in the aggregate.
10. Compliance with Securities Act; Disposition of Warrant or Shares of
Common Stock.
(a) Compliance with Securities Act. The Holder, by acceptance hereof,
agrees that this Warrant, and the Shares issuable upon exercise of this Warrant,
are being acquired for investment and that such Holder will not offer, sell or
otherwise dispose of this Warrant, or any Shares issuable upon exercise of this
Warrant, except under circumstances which will not result in a violation of the
Securities Act or any applicable state securities laws. This Warrant and all
Shares issued upon exercise of this Warrant (unless registered under the
Securities Act and any applicable state securities laws) shall be stamped or
imprinted with a legend in substantially the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES HAVE BEEN ACQUIRED
FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY
NOT BE SOLD OR OTHERWISE TRANSFERRED WITHOUT COMPLIANCE WITH THE
REGISTRATION OR QUALIFICATION PROVISIONS OF APPLICABLE FEDERAL AND
STATE SECURITIES LAWS OR APPLICABLE EXEMPTIONS THEREFROM."
10
Whenever the foregoing legend is no longer required in the opinion of counsel to
the holder hereof, upon request of the holder hereof, the Company, at its sole
expense (including, without limitation, the payment of any applicable issue
taxes), shall issue or cause to be issued in the name of and delivered to the
holder hereof or as the holder hereof may direct new Warrant Certificates of
like tenor, dated the date hereof, and/or new certificates for shares of Common
Stock.
(b) Transferability. Subject to compliance with applicable federal and
state securities laws, the holder hereof may, without the prior written consent
of the Company, transfer this Warrant and all rights hereunder are transferable,
in whole or in part, at any time by the holder hereof to any Person. Any
transfer of this Warrant or any portion hereof shall be recorded on the books of
the Company upon the surrender of this Warrant, properly endorsed for transfer
by delivery of an Assignment Form in substantially the form attached hereto as
Exhibit B, to the Company at the address set forth in Section 16 hereof. In the
event of a partial transfer of this Warrant, the Company shall issue to the
holder one or more appropriate new Warrants.
11. No Stockholder Rights or Liabilities. Prior to the exercise of
this Warrant, the holder hereof shall not be entitled to any rights of a
stockholder with respect to the Shares, including (without limitation) the right
to vote such Shares or receive dividends or other distributions thereon, and the
holder hereof shall not be entitled to any notice or other communication
concerning the business or affairs of the Company, other than as specifically
required by this Warrant. Nothing contained in this Warrant shall be construed
as imposing any obligation on any holder to purchase any securities or as
imposing any liabilities on such holder as a stockholder of the Company, whether
such obligation or liabilities are asserted by the Company or by creditors of
the Company or otherwise.
12. Replacement of Warrants. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant held by any Person other than the initial holder hereof or any
institutional investor, upon delivery of an indemnity reasonably satisfactory to
the Company or, in the case of any such mutilation, upon surrender of this
Warrant for cancellation at the principal office of the Company, the Company, at
the expense of the holder (including, without limitation, the payment of any
applicable issue taxes), shall execute and deliver, in lieu thereof, a new
Warrant of like tenor and dated the date hereof.
13. Remedies. The Company stipulates that the remedies at law
available to the holder hereof in the event of any default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate and that, to the fullest extent permitted by law, such
terms may be specifically enforced by a decree for the specific performance of
any agreement contained herein or by an injunction against a violation of any of
the terms hereof or otherwise. No failure or delay on the part of the holder
hereof, in exercising any right, power or remedy hereunder, shall operate as a
suspension or waiver thereof, nor shall any single or partial exercise of any
such right, power or remedy preclude any other or further exercise thereof or
the exercise of any other right, power or remedy hereunder. The remedies herein
provided are in addition to and not exclusive of any other remedies provided at
law or in equity.
11
14. Successors and Assigns. The terms and provisions of this Warrant shall
inure to the benefit of, and be binding upon, the Company and the holder hereof
from time to time of this Warrant and the Shares issuable upon exercise of this
Warrant.
15. Amendments and Waivers. Any term of this Warrant may be amended,
altered or modified and the observance of any term of this Warrant may be waived
(either generally or in a particular instance and either retroactively or
prospectively) upon the written consent of the Company and the holder hereof.
Any waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given.
16. Notices. All notices required under this Warrant shall be deemed to
have been given or made for all purposes (i) upon personal delivery, (ii) upon
confirmation receipt that the communication was successfully sent to the
applicable number if sent by facsimile, or (iii) one day after being sent, when
sent by professional overnight courier service. Notices to the Company shall be
sent to the address of the Company set forth below (or at such other place as
the Company shall notify the Holders hereof in writing) and notices to the
Holder shall be sent to the address of the Holder set forth on the signature
page hereto (or at such other place as the Holder shall notify the Company in
writing):
To the Company: Aegis Communications Group, Inc.
0000 Xxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxx Xxxxxx
President
17. Headings. The section and subsection headings of this Warrant are
inserted for convenience only and shall not constitute a part of this Warrant in
construing or interpreting any provision hereof.
18. Governing Law. This Warrant and the rights and duties of the parties
hereto hereunder and (unless otherwise provided) all amendments and supplements
to, and all consents and waivers pursuant to, this Warrant shall in all respects
be governed by, and construed and enforced in accordance with, the laws of the
State of New York without giving effect to its conflict of laws principles or
rules.
19. Severability. If any provision of this Warrant is held to be invalid or
unenforceable for any reason, it shall be adjusted rather than voided, if
possible, to achieve the intent of the parties hereto to the maximum extent
possible. Any provision of this Warrant which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
12
20. Defined Terms. The following terms have the meanings indicated below,
unless the context otherwise requires:
"Additional Shares of Common Stock" means all shares, including treasury shares,
of Common Stock, issued, sold or granted, or deemed to be issued, sold or
granted pursuant to the terms hereof, by the Company after the date hereof,
whether or not subsequently reacquired or retired by the Company, other than the
shares of Common Stock issued upon the exercise of this Warrant.
"Affiliate" means, with respect to any specified Person, any other Person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person.
"Appraiser" means an independent nationally recognized investment bank or other
qualified financial institution acceptable to the Company and the holder hereof.
"Business Day" means any day other than a Saturday or a Sunday or a day on which
commercial banking institutions in New York City are authorized or required to
be closed.
"Common Stock" means the common stock of the Company, par value $0.01 per
share, any capital stock into which such Common Stock shall have been changed or
converted, any capital stock resulting from any reclassification of such Common
Stock, and all other capital stock of any class or classes of the Company, other
than preference stock, the holders of which share equally with the Common Stock
in current dividends and liquidating dividends after the payment of dividends
and distributions on any shares entitled to preference.
"Convertible Securities" means any evidences of indebtedness, shares of capital
stock or any other securities convertible into or exchangeable for, directly or
indirectly, shares of Common Stock.
"Current Market Price" means the average of the closing prices of the Common
Stock during the five-day trading period ending immediately prior to the date of
determination as quoted on the Nasdaq Small Cap Market or any United States
automated quotation system or national securities exchange or national market
system on which the Common Stock is then quoted or traded, as applicable.
"Excluded Stock" means securities issued, or deemed issued, to directors,
officers, employees or consultants of the Company or a subsidiary of the Company
in connection with their service as directors of the Company or a subsidiary of
the Company, their employment by the Company or a subsidiary of the Company or
their retention as consultants by the Company or a subsidiary of the Company
under the Company's employee benefit plans approved by the Company's board of
directors, as such plans may be amended from time to time with the approval of
the Company's board of directors, or under other plans, adopted or assumed by
the Company with the approval of the Company's board of directors.
"Fair Market Value" means (i) with respect to any share of Common Stock,
including with respect to a Share for purposes of Section 2(b), the Current
Market Price; provided that, if the Common Stock is not then quoted on the
Nasdaq Small Cap Market or any United States automated quotation system or
national securities exchange or national market system or the OTC Bulletin Board
or Pink Sheets, the fair market value shall be: (A) the value based on the most
recently completed arm's
13
length transaction between the Company and a Person other than an affiliate of
the Company within the three-month period prior to the date of determination
with respect to such security, or (B) if (A) does not apply, the fair market
value as most recently determined by an Appraiser within such prior three-month
period, provided, that, any such appraisal was made within the two-month period
following the date of the financial statements on which such appraisal is based,
or (C) if neither (A) nor (B) applies, the fair market value as reasonably
determined by the Board of Directors of the Company in good faith, as evidenced
by a written board resolution delivered to the holder hereof and (ii) with
respect to any other property other than cash or Common Stock, (A) the value
based on the most recently completed arm's length transaction between the
Company and a Person other than an affiliate of the Company within the
three-month period prior to the date of determination with respect to such
property, or (B) if (A) does not apply, the fair market value as most recently
determined by an Appraiser within such prior three-month period, provided that,
any such appraisal was made within the two-month period following the date of
the financial statements on which such appraisal is based, or (C) if neither (A)
nor (B) applies, the fair market value as reasonably determined by the Board of
Directors of the Company in good faith, as evidenced by a written board
resolution delivered to the holder hereof. Any determination pursuant to
subsections (i)(B) or (C) or (ii)(B) or (C) shall be made on the basis of an
arm's length sale of a going concern between an informed and willing buyer and
an informed and willing seller, under no compulsion to buy or sell, taking into
account all the relevant facts and circumstances then prevailing and without
consideration of (x) the lack of an actively trading public market for the
Common Stock, (y) any restrictions on the transfer of shares of Common Stock or
(z) any control premium or minority discount. For the avoidance of doubt, any
determination pursuant to subsections (i)(C) or (ii)(C) shall be subject to
Section 6(k).
"Note" means the secured promissory note issued to the Purchaser on the date
hereof pursuant to the Purchase Agreement.
"Options" means rights, options or warrants to subscribe for, purchase or
otherwise acquire, directly or indirectly, shares of Common Stock, including,
without limitation, Convertible Securities.
"Person" means any individual, partnership, limited liability company, unlimited
liability company, corporation, association, joint stock company, trust, joint
venture, unincorporated organization or any federal, state, county or municipal
governmental or quasi-governmental agency, department, commission, board,
bureau, instrumentality or similar entity.
"Registration Rights Agreement" means the Registration Rights Agreement entered
into by the Company and the Purchaser on the date hereof.
"Securities Act" means the Securities Act of 1933 and all rules and regulations
of the Securities and Exchange Commission thereunder, as amended from time to
time.
14
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in its
corporate name by its duly authorized officer and to be dated as of the Date of
Grant set forth on the first page to this Warrant.
AEGIS COMMUNICATIONS GROUP, INC.
By: /s/ Xxxx Xxxx Xxxxxx
------------------------------------
Name: Xxxx Xxxx Xxxxxx
Title: President
EXHIBIT A-1
NOTICE OF EXERCISE
To: AEGIS COMMUNICATIONS GROUP, INC. (the "Company")
1. The undersigned hereby:
elects to purchase ___ shares of Common Stock of the Company pursuant to the
terms of the attached Warrant, and tenders herewith payment of the purchase
price of such shares in full, or elects to exercise its net issuance rights
pursuant to Section 2(b) of the attached Warrant with respect to ___ shares of
Common Stock.
2. Please issue a certificate or certificates representing said shares in the
name of the undersigned or in such other name or names as are specified below:
-------------------------------------------
(Name)
-------------------------------------------
-------------------------------------------
(Address)
3. The undersigned represents that the aforesaid shares are being acquired for
the account of the undersigned for investment and not with a view to, or for
resale in connection with, the distribution thereof and that the undersigned has
no present intention of distributing or reselling such shares, all except as in
compliance with applicable securities laws.
-------------------------------------------
(Signature)
--------------------------
(Date)
B-1
EXHIBIT A-2
NOTICE OF EXERCISE
To: AEGIS COMMUNICATIONS GROUP, INC. (the "Company")
1. Contingent upon and effective immediately prior to the closing (the
"Closing") of the Company's public offering contemplated by the Registration
Statement on Form S-__ (File No. ______________), which was filed with the
Securities and Exchange Commission on ____________, 20__, the undersigned
hereby:
elects to purchase ___ shares of Common Stock of the Company (or such lesser
number of shares as may be sold on behalf of the undersigned at the Closing)
pursuant to the terms of the attached Warrant, or elects to exercise its net
issuance rights pursuant to Section 2(b) of the attached Warrant with respect to
___ Shares of Common Stock.
2. Please deliver to the custodian for the selling shareholders a stock
certificate representing such ___ shares.
3. The undersigned has instructed the custodian for the selling shareholders to
deliver to the Company $____ or, if less, the net proceeds due the undersigned
from the sale of shares in the aforesaid public offering. If such net proceeds
are less than the purchase price for such shares, the undersigned agrees to
deliver the difference to the Company prior to the Closing.
-------------------------------------------
(Name)
-------------------------------------------
-------------------------------------------
(Address)
-----------------------
(Date)
B-1
EXHIBIT B
ASSIGNMENT FORM
To: AEGIS COMMUNICATIONS GROUP, INC. (the "Company")
The undersigned hereby assigns and transfers unto _____________________________
_______________________________________________________________________ (Please
typewrite or print in block letters) the right to purchase ____________ Shares
(as defined in the Warrant) of Aegis Communications Group, Inc., subject to the
Warrant, dated as of _____________________________, granted to the undersigned
(the "Warrant").
This assignment complies with the provisions of Section 10 of the Warrant.
Date:_______________________
By:
----------------------------------------
-------------------------------------------
(Print Name of Signatory)
-------------------------------------------
(Title of Signatory)
B-1
