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EXHIBIT 10.8
THE WARRANTS EVIDENCED BY THIS CERTIFICATE HAVE BEEN ISSUED OR SOLD IN RELIANCE
ON EXEMPTIONS FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933 AND APPLICABLE
STATE SECURITIES LAWS AND MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN A TRANSACTION
WHICH IS EXEMPT UNDER SUCH ACT AND STATE LAWS OR PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT AND STATE LAWS.
NEW COMMERCE BANCORP.
STOCK WARRANT AGREEMENT
JANUARY 12, 1999 7,500 Shares
Warrants to purchase 7,500 shares of Common Stock (the "Shares") of New
Commerce BanCorp., a South Carolina corporation (the "Company"), are hereby
granted to __________________ (the "Warrant Holder") in consideration of the
financial risk associated with Warrant Holder's investment in the Company during
its organizational stage. Such Warrants are granted on the following terms and
conditions:
1. EXERCISE OF WARRANTS. The warrants granted in this agreement (the
"Warrants") may be exercised in whole or in part at any time beginning on the
later of the date that New Commerce Bank (the "Bank") opens for business and the
date that the first anniversary of the date of the Company's Registration
Statement filed with the Securities and Exchange Commission in connection with
the Company's initial public offering is completed (the "Vesting Date").
Exercise of the Warrants is subject to the following:
(a) EXERCISE PRICE. The exercise price (the "Exercise Price")
shall be $10.00 per Share, subject to adjustment pursuant to
Section 2 below.
(b) EXPIRATION OF WARRANT TERM. The Warrants will expire at 5:00
p.m. Eastern Standard Time on the tenth anniversary of the
Vesting Date, and may not be exercised thereafter (the
"Expiration Date").
(c) PAYMENT. The purchase price for Shares as to which the
Warrants are being exercised shall be paid in cash, by wire
transfer, by certified or bank cashier's check, or by personal
check drawn on funds on deposit with the Bank.
(d) METHOD OF EXERCISE. The Warrants shall be exercisable by a
written notice delivered to the President or Secretary of the
Company which shall:
(i) State the owner's election to exercise the Warrants,
the number of Shares with respect to which it is
being exercised, the person in whose name the stock
certificate for such Shares is to be registered and
such person's address and tax identification number
(or, if more than one, the names, addresses and tax
identification numbers of such persons);
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(ii) Be signed by the person or persons entitled to
exercise the Warrants and, if the Warrants are being
exercised by any person or persons other than the
original holder thereof, be accompanied by proof
satisfactory to counsel for the Company of the right
of such person or persons to exercise the Warrants;
and
(iii) Be accompanied by the originally executed copy of
this Stock Warrant Agreement.
(e) PARTIAL EXERCISE. In the event of a partial exercise of the
Warrants, the Company shall either issue a new agreement for
the balance of the Shares subject to this Stock Warrant
Agreement after such partial exercise, or it shall
conspicuously note hereon the date and number of Shares
purchased pursuant to such exercise and the number of Shares
remaining covered by this Stock Warrant Agreement.
(f) RESTRICTIONS ON EXERCISE. The Warrants may not be exercised
(i) if the issuance of the Shares upon such exercise would
constitute a violation of any applicable federal or state
securities laws or other law or regulation or (ii) unless the
Company or the holder hereof, as applicable, obtains any
approval or other clearance which the Company determines to be
necessary or advisable from the Federal Reserve Board, the
Office of the Comptroller of the Currency, the Federal Deposit
Insurance Corporation or any other state or federal banking
regulatory agency with regulatory authority over the operation
of the Company or the Bank (collectively the "Regulatory
Agencies"). The Company may require representations and
warranties from the Warranty Holder as required to comply with
applicable laws or regulations, including the Securities Act
of 1933 and state securities laws.
2. ANTI-DILUTION; MERGER. If, prior to the exercise of Warrants hereunder,
the Company (i) declares, makes or issues, or fixes a record date for the
determination of holders of Common Stock entitled to receive, a dividend or
other distribution payable on the Shares in shares of its capital stock, (ii)
subdivides the outstanding Shares, (iii) combines the outstanding Shares, (iv)
issues any shares of its capital stock by reclassification of the Shares,
capital reorganization or otherwise (including any such reclassification or
reorganization in connection with a consolidation or merger or and sale of all
or substantially all of the Company's assets to any person), then the Exercise
Price, and the number and kind of shares receivable upon exercise, in effect at
the time of the record date for such dividend or of the effective date of such
subdivision, combination or reclassification shall be proportionately adjusted
so that the holder of any Warrant exercised after such time shall be entitled to
receive the aggregate number and kind of shares which, if such Warrant had been
exercised immediately prior to such time, he would have owned upon such exercise
and been entitled to receive by virtue of such dividend, distribution,
subdivision, combination, reclassification, reorganization, consideration,
merger or sale.
3. VALID ISSUANCE OF COMMON STOCK. The Company possesses the full
authority and legal right to issue, sell, transfer, and assign this Warrant and
the Shares issuable pursuant to this Warrant. The issuance of this Warrant vests
in the holder the entire legal and beneficial interests in this Warrant, free
and clear of any liens, claims, and encumbrances and subject to no legal or
equitable restrictions of any kind except as described herein. The Shares that
are
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issuable upon exercise of this Warrant, when issued, sold and delivered in
accordance with the terms of this Agreement for the consideration expressed
herein, will be duly and validly issued, fully paid, and non-assessable, and
will be free of restrictions on transfer other than restrictions under
applicable state and federal securities.
4. COMPLIANCE WITH SECURITIES LAWS. This Agreement and the Warrants
represented hereby were issued in reliance on an exemption from registration
under the Securities Act of 1933 (the "Act") pursuant to Section 4(2) of the
Act, and other applicable exemptions under state securities laws. The Company's
reliance on such exemption is predicated in part on the Warrant Holder's
representations set forth herein. Warrant Holder understands that the Warrants
and the Shares issuable upon exercise of the Warrants may not be sold,
transferred or otherwise disposed of without registration under the Securities
Act of 1933, or an exemption therefrom, and that in the absence of an effective
registration statement covering such shares or an available exemption from
registration under the Securities Act, such Shares must be held indefinitely.
5. RESTRICTIONS ON TRANSFERABILITY. This Agreement, the Warrants, and
the Shares issuable on exercise of the Warrants may not assigned or transferred
by the Warrant Holder without the Company's prior written consent and, if so
requested by the Company, the delivery by the Warrant Holder to the Company of
an opinion of counsel in form and substance satisfactory to the Company stating
that such transfer or assignment is in compliance with the Securities Act of
1933 and applicable state securities laws. More particularly, but without
limiting the generality of the foregoing, the Warrants may not be assigned,
transferred (except as provided above), pledged or hypothecated in any way
(whether by operation of law or otherwise) and shall not be subject to
execution, attachment or similar process. Any attempted assignment, transfer,
pledge, hypothecation or other disposition of these Warrants contrary to the
provisions hereof shall be without legal effect.
6. RESTRICTIVE LEGEND. Each certificate for Shares issued upon
exercise of the Warrant shall bear a legend stating that they have not been
registered under the Securities Act of 1933 or any state securities laws and
referring to the restrictions on transferability and sale herein.
7. MANDATORY EXERCISE; TERMINATION.
(a) The Company or the Bank may be required to increase its
capital to meet capital requirements imposed by statute, rule,
regulation, or guideline. In order to achieve such capital
increase, the Regulatory Agencies may direct the Company to
require the Warrant Holders to either (i) exercise all part of
their Warrants or (ii) allow the Warrants to be terminated. If
the Regulatory Agencies so direct the Company, then the
Warrant Holder must exercise or forfeit the Warrants as set
forth below.
(b) When the Company or the Bank is required to increase its
capital as described in subsection (a) above, the Company
shall send a notice (the "Notice") to the Warrant Holder (i)
specifying the number of Shares relating to the Warrants for
which the Warrants must be exercised (the "Number") (if less
than all shares relating to warrants held by all holders of
warrants of the Company under agreements substantially similar
to this one are required by the Company to be exercised or
cancelled, the Number for the Warrant Holder shall reflect a
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proportionate allocation based on the number of Shares subject
to this Agreement as compared to the total number of shares
subject to warrants held by all such warrant holders as a
group); (ii) specifying the date prior to which the Warrants
must be totally or partially exercised, as the case may be
(the "Deadline"); (iii) specifying the Exercise Price for the
Shares to be purchased pursuant to the Warrants (such Exercise
Price not to be less than current book value per share); and
(iv) stating that the failure of the Warrant holder to
exercise the Warrants shall result in their automatic
termination.
(c) If the Warrant holder does not exercise the Warrants pursuant
to the terms of the Notice, this Agreement shall be
automatically terminated on the Deadline, without further act
or action by the Warrant Holder or the Company, and the
Warrant Holder shall deliver this Agreement to the Company for
cancellation. If the Number is less than the total number of
Shares that are then subject to exercise under this Agreement,
the Company shall issue a new Stock Warrant Agreement in
compliance with Section 1(e) hereof.
8. COVENANTS OF THE COMPANY. During the term of the Warrants, the Company
shall:
(a) at all times authorize, reserve and keep available, solely for
issuance upon exercise of this Warrant, sufficient shares of
common stock from time to time issuable upon exercise of this
Warrant;
(b) on receipt of evidence reasonably satisfactory to the Company
of the loss, theft, destruction or mutilation of this Warrant
and, in the case of loss, theft, or destruction, on delivery
of any indemnity agreement or bond reasonably satisfactory in
form and amount to the Company or, in the case of mutilation,
on surrender and cancellation of this Warrant, at its expense
execute and deliver, in lieu of this Warrant, a new Warrant of
like tenor; and
(c) on surrender for exchange of this Warrant or any Warrant
substituted therefor pursuant hereto, properly endorsed, to
the Company, at its expense, issue and deliver to or on the
order of the holder thereof a new Warrant or Warrants of like
tenor, in the name of such holder or as such holder (on
payment by such holder of any applicable transfer taxes) may
direct, calling in the aggregate on the face or faces thereof
for the issuances of the number of shares of Common Stock
issuable pursuant to the terms of the Warrant or Warrants so
surrendered.
9. NO DILUTION OR IMPAIRMENT. The Company shall not amend its Certificate of
Incorporation or participate in any reorganization, transfer of assets,
consolidation, merger, dissolution, issuance or sale of securities or any other
voluntary action for the purpose of avoiding or seeking 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 carrying out all such
action as may be reasonably necessary in order to protect the exercise rights of
the holder against improper dilution or other impairment.
10. AMENDMENT. Neither this Agreement nor the rights granted hereunder may be
amended, changed or waived except in writing signed by each party hereto.
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IN WITNESS WHEREOF, the Company has executed and the holder has
accepted this Stock Warrant Agreement as of the date and year first above
written.
NEW COMMERCE BANCORP.
By:
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President
(CORPORATE SEAL)
Attest:
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Secretary
WARRANT HOLDER:
By:
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Signature
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Print Name
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