EXHIBIT 10.5
FORM OF
WARRANT AGREEMENT
THIS AGREEMENT is made and entered into as of the ___ day of _________,
2005, by and between Mountain National Bancshares, Inc., a Tennessee corporation
(the "Corporation"), and ________________________ (the "Warrant Holder").
W I T N E S S E T H
WHEREAS, the Warrant Holder has purchased _________ shares of the
Corporation's common stock, $1.00 par value per share (the "Common Stock"), at a
price of $24.00 per share in connection with the Corporation's public offering
of its common stock; and
WHEREAS, each purchaser of shares of the Corporation's common stock in
the public offering is entitled to a warrant to purchase that number of shares
equal to the number of shares of common stock purchased by such purchaser in the
Corporation's public offering;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. GRANT OF WARRANT. Subject to the terms, restrictions, limitations
and conditions stated herein, the Corporation hereby grants to the Warrant
Holder the right (the "Warrant") to purchase all or any part of an aggregate of
_____________ shares of the Common Stock, subject to adjustment in accordance
with Section 7 hereof.
2. TERM. The term for the exercise of the Warrant begins on the date
that the Corporation consummates its public offering (the "Issue Date") and ends
at 5:00 p.m., Eastern Time, on the second anniversary of the Issue Date (the
"Expiration Time"). The Warrant may be exercised in whole, or in part, at any
time prior to the Expiration Time.
3. PURCHASE PRICE. The price per share to be paid by the Warrant Holder
for the shares of Common Stock subject to this Warrant shall be $25.20, subject
to adjustment as set forth in Section 6 hereof (such price, as adjusted,
hereinafter called the "Purchase Price").
4. EXERCISE OF WARRANT. The Warrant may be exercised by the Warrant
Holder by delivery to the Corporation, at the address of the Corporation set
forth under Section 10(a) hereof or such other address as to which the
Corporation advises the Warrant Holder pursuant to Section 10(a) hereof, of the
following:
(a) Written notice of exercise specifying the number of shares
of Common Stock with respect to which the Warrant is being exercised;
and
(b) A cashier's or certified check payable to the Corporation
for the full amount of the aggregate Purchase Price for the number of
shares as to which the Warrant is being exercised.
5. ISSUANCE OF SHARES. Upon receipt of the items set forth in Section
4, and subject to the terms hereof, the Corporation shall cause to be delivered
to the Warrant Holder stock certificates for the number of shares specified in
the notice to exercise, such shares to be registered under the name of
the Warrant Holder. Notwithstanding the foregoing, the Corporation shall not be
required to issue or deliver any certificate for shares of Common Stock
purchased upon the exercise of the Warrant or any portion thereof prior to the
fulfillment of the following conditions:
(a) The admission of such shares for listing on all stock
exchanges on which the Common Stock is then listed; and
(b) The completion of any registration or other qualification
of such shares which the Corporation shall deem necessary or advisable
under any federal or state law or under the rulings or regulations of
the Securities and Exchange Commission or any other governmental
regulatory body.
6. ANTIDILUTION, ETC.
(a) If, prior to the Expiration Time, the Corporation shall
subdivide its outstanding shares of Common Stock into a greater number
of shares, or declare and pay a dividend of its Common Stock payable in
additional shares of its Common Stock, the Purchase Price as then in
effect shall be proportionately reduced, and the number of shares of
Common Stock then subject to exercise under the Warrant (and not
previously exercised) shall be proportionately increased.
(b) If, prior to the Expiration Time, the Corporation shall
combine its outstanding shares of the Common Stock into a smaller
number of shares, the Purchase Price, as then in effect, shall be
proportionately increased, and the number of shares of Common Stock
then subject to exercise under the Warrant (and not previously
exercised), shall be proportionately reduced.
7. REORGANIZATION, RECLASSIFICATION, CONSOLIDATION OR MERGER. If, prior
to the Expiration Time, there shall be any reorganization or reclassification of
the Common Stock (other than a subdivision or combination of shares provided for
in Section 6 hereof), or any consolidation or merger of the Corporation with
another entity in which the Corporation is not the surviving corporation, the
Warrant Holder shall thereafter be entitled to receive, during the term hereof
and upon payment of the Purchase Price, the number of shares of stock or other
securities or property of the Corporation or of the successor entity (or its
parent company) resulting from such consolidation or merger, as the case may be,
to which a holder of the Common Stock, deliverable upon the exercise of this
Warrant, would have been entitled upon such reorganization, reclassification,
consolidation or merger; and in any case, appropriate adjustment (as determined
by the Board of Directors of the Corporation in its sole discretion)
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shall be made in the application of the provisions herein set forth with respect
to the rights and interest thereafter of the Warrant Holder to the end that the
provisions set forth herein (including the adjustment of the Purchase Price and
the number of shares issuable upon the exercise of this Warrant) shall
thereafter be applicable, as near as may reasonably be practicable, in relation
to any shares or other property thereafter deliverable upon the exercise hereof.
8. NOTICE OF ADJUSTMENTS. Upon any adjustment provided for in Section 6
or Section 7 hereof, the Corporation, within thirty (30) days thereafter, shall
give written notice thereof to the Warrant Holder at the address set forth under
Section 10(a) hereof or such other address as the Warrant Holder may advise the
Corporation pursuant to Section 10(a) hereof, which notice shall state the
Purchase Price as adjusted and the increased or decreased number of shares
purchasable upon the exercise of this Warrant, setting forth in reasonable
detail the method of calculation of each.
9. TRANSFER. This Warrant may be transferred, in whole or in part, by
presentation of the Warrant to the Corporation with written instructions for
such transfer. Upon presentation for transfer, the Corporation shall promptly
execute and deliver a new Warrant or Warrants in the form hereof in the name of
the assignee or assignees and in the denominations specified in such
instructions. All expenses, taxes and other charges payable in connection with
the preparation, issuance and delivery of Warrants under this Section 9 shall be
paid by the party requesting transfer of the Warrant.
10. MISCELLANEOUS.
(a) All notices, requests, demands and other communications
required or permitted hereunder shall be in writing and shall be deemed
to have been duly given when delivered by hand, telegram or facsimile
transmission, or if mailed, by postage prepaid first class mail, on the
third business day after mailing, to the following address (or at such
other address as a party may notify the other hereunder):
To the Corporation:
Mountain National Bancshares, Inc.
000 Xxxx Xxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx, President
To the Warrant Holder:
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(b) The Corporation covenants that it has reserved and will
keep available, solely for the purpose of issue upon the exercise
hereof, a sufficient number of shares of Common Stock to permit the
exercise hereof in full.
(c) No holder of this Warrant, as such, shall be entitled to
vote or receive dividends with respect to the shares of Common Stock
subject hereto or be deemed to be a shareholder of the Corporation for
any purpose until such Common Stock has been issued.
(d) This Warrant Agreement shall constitute the entire
agreement contemplated by the Corporation and the Warrant Holder and
may be amended only by an instrument in writing executed by the party
against whom enforcement of the amendment is sought.
(e) This Warrant may be executed in counterparts, each of
which shall be deemed an original, but all of which shall constitute
one and the same instrument.
(f) This Warrant shall be governed by and construed and
enforced in accordance with the laws of the State of Tennessee.
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IN WITNESS WHEREOF, the Corporation has caused this Warrant to be
signed by its duly authorized officers, and the Warrant Holder has executed this
Warrant, all as of the day and year first above written.
MOUNTAIN NATIONAL BANCSHARES, INC.
By:
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Name: Xxxxxx X. Xxxxxxxx
Title: President and Chief Executive Officer
WARRANT HOLDER
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Print Name:
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