Exhibit 10.21
Neither this Warrant, nor the shares of capital stock issuable upon exercise
of this Warrant, has been registered under the Securities Act of 1933, as
amended (the "act"), or any applicable state securities laws, and neither may be
sold or transferred unless such sale or transfer is in accordance with the
registration requirements of such Act and applicable laws or some other
exemption from the registration requirements of such Act and applicable laws is
available with respect thereto.
CLASS A WARRANT
Date of Issuance: April 1, 2002 Number of Shares: As Set Forth in Section 2
AMERICANA PUBLISHING, INC.
1. Issuance. This Class A Warrant (the "Warrant") is issued to BG
Holdings, LLC by Americana Publishing, Inc., a Colorado corporation (hereinafter
with its successors called the "Company"). This Warrant is one of the Warrants
issued by the Company pursuant to, and is entitled to the benefits of, the 12%
Senior Secured Convertible Debenture and Warrant Purchase Agreement, dated as of
April 1, 2002, (as the same may be amended from time to time, hereinafter
referred to as the "Purchase Agreement") by and among the Company and the
investors named in Schedule 2 thereto (the "Investors"), and each holder of this
Warrant, by its acceptance hereof, agrees to be bound by the provisions of the
Purchase Agreement and is deemed to have made the representations and warranties
contained in Section 9 thereof. Capitalized terms used herein but not otherwise
defined shall have the meaning assigned to such terms in the Purchase Agreement.
This Warrant will be registered on the books of the Company or its agent as to
principal and interest. Any transfer of this Warrant will be effected only by
surrender of this Warrant to the Company and reissuance of a new warrant to the
transferee.
2. Purchase Price; Number of Shares. Subject to the terms and
conditions hereinafter set forth and applicable securities laws, the registered
holder of this Warrant (the "Holder"), commencing on the date hereof and ending
on April 1, 2009, is entitled upon surrender of this Warrant, with the duly
executed subscription form annexed hereto as Exhibit A duly executed, at the
office of the Company at 000 Xxx Xxxxx XX, Xxxxx 000X, Xxxxxxxxxxx, XX 00000, or
such other office as the Company shall notify the Holder of in writing, to
purchase from the Company, at the Purchase Price (as defined below) per share,
the number of fully paid and nonassessable shares of Common Stock obtained by
dividing (a) the of Principal Amount of each Debenture by (b) the Conversion
Price. As used herein, "Purchase Price" shall mean an amount equal to 50% of the
lesser of the average of the lowest three (3) closing bid prices of the
Company's Common Stock as reported by the over-the-counter electronic bulletin
board ("OTCBB") or such other exchange where the Company's Common Stock is then
trading during: (i) the 30 trading days prior to the Closing Date, or (ii) the
30 trading days immediately prior to the date or dates all or any portion of
this Warrant is exercised (each such date, an "Exercise Date"), as such prices
may be adjusted from time to time pursuant to the terms of this Warrant.
3. Payment of Purchase Price. The aggregate Purchase Price may be
paid (i) in cash or by check, (ii) by the surrender by the Holder to the Company
of any promissory notes or other obligations issued by the Company, with all
such notes and obligations so surrendered being credited against the aggregate
Purchase Price in an amount equal to the outstanding principal amount thereof
plus accrued but unpaid interest and penalties to the date of surrender, (iii)
through delivery by the Holder to the Company of other securities issued by the
Company, with such securities being credited against the aggregate Purchase
Price in an amount equal to the fair market value thereof, as is determined in
good faith by the board of directors of the Company (the "Board"), or (iv) by
any combination of the foregoing. The Board shall promptly respond in writing to
an inquiry by the Holder as to the fair market value of any securities the
Holder may wish to deliver to the Company pursuant to clause (iii) above.
4. Net Issue Election. In lieu of exercising this Warrant pursuant
to Section 3 hereof, the Holder may elect to receive, without the payment by the
Holder of any additional consideration, a number of shares of Common Stock that
is equal to the value of this Warrant or any portion hereof by the surrender of
this Warrant or such portion to the Company by surrender of this Warrant at the
principal office of the Company together with the Net Issue Election Notice
similar to the form annexed hereto as Exhibit B duly executed, at the office of
the Company. Thereupon, the Company shall issue to the Holder such number of
fully paid and nonassessable shares of Common Stock as is computed using the
following formula:
X = Y (A-B)
A
where
X = the number of shares to be issued to the Holder pursuant to
this Section 4.
Y = the number of shares covered by this Warrant in respect of
which the net issue election is made pursuant to this Section 4.
A = the Current Value Per Share (as defined below).
B = the Purchase Price in effect under this Warrant at the time
the net issue election is made pursuant to this Section 4.
For purposes of the above calculation, the "Current Value Per Share" shall be
(i) subject to clause (ii) below, the closing bid price of the Company's Common
Stock as reported by the OTCBB or such other exchange where the Company's Common
Stock is then trading on the Exercise Date, or (ii) if the Company is then
subject to an Acquisition Event (as defined in Section 11), in which case the
Current Value Per Share shall be the value per share that the holders of the
Company's Common Stock actually received or will receive as determined pursuant
to Section 11;
5. Payment by Cash in Certain Events. Notwithstanding the provisions
of Section 3 and Section 4, in the event there is an effective registration
statement covering all or some portion of the shares being exercised by the
Holder, the net issue election as provided by this Section 4 shall not be
available to the Holder in respect of the shares of Common Stock covered by such
registration statement and the Holder agrees to pay the aggregate Purchase Price
for such shares in cash or by check.
6. Partial Exercise. This Warrant may be exercised in part, and the
Holder shall be entitled to receive a new warrant, which shall be dated as of
the date of this Warrant, covering the number of shares in respect of which this
Warrant shall not have been exercised.
7. Issuance Date. The person or persons in whose name or names any
certificate representing shares of Common Stock is issued hereunder shall be
deemed to have become the holder of record of the shares represented thereby as
at the close of business on the date this Warrant is exercised with respect to
such shares, whether or not the transfer books of the Company shall be closed.
Following the Holder's exercise of this Warrant pursuant to Section 3 or 4
hereof, the Holder shall be entitled to all of the rights and benefits as a
holder of Common Stock.
8. Expiration Date; Automatic Exercise. This Warrant shall expire at
the close of business on April 1, 2009; provided, however, this Warrant
shall automatically be deemed to be exercised in full pursuant to the provisions
of Section 4 hereof (notwithstanding the restrictive provisions of Section 5),
without any further action on behalf of the Holder, immediately prior to the
time this Warrant would otherwise expire pursuant to the preceding sentence.
9. Reserved Shares; Valid Issuance. The Company covenants that it
will at all times reserve and keep available such number of its authorized
shares of Common Stock, free from all preemptive or similar rights therein, as
will be sufficient to permit, respectively, the exercise of this Warrant in full
receivable upon such exercise.
10. Stock Dividends. If the Company shall subdivide the Common
Stock, by split-up or otherwise, or combine the Common Stock, or issue
additional shares of Common Stock in payment of a stock dividend on the Common
Stock, the number of shares issuable on the exercise of this Warrant shall
forthwith be proportionately increased in the case of a subdivision or stock
dividend, or proportionately decreased in the case of a combination, and the
Purchase Price shall forthwith be proportionately decreased in the case of a
subdivision or stock dividend, or proportionately increased in the case of a
combination.
11. Capital Reorganization, Merger or Consolidation. If at any time
while this Warrant is outstanding and unexpired, (i) there shall be any
reclassification, capital reorganization or change of the Common Stock (other
than as a result of a subdivision, combination or stock dividend provided for in
Section 10 hereof) (any event described in this clause (i), a "Reclassification
Event"), or (ii) any consolidation of the Company with, or merger of the Company
into, another corporation or other business organization (other than a
consolidation or merger in which the Company is the continuing Company and which
does not result in any reclassification or change of the outstanding Common
Stock), or any sale or conveyance to another corporation or other business
organization of all or substantially all of the assets of the Company (any event
described in this clause (ii), an "Acquisition Event"), then, as part of such
Reclassification Event or Acquisition Event, lawful provisions shall be made so
that the Holder shall thereafter have the right to purchase, at a total price
not to exceed that payable upon the exercise of this Warrant in full, the kind
and amount of shares of stock and other securities and property receivable upon
such Reclassification Event or Acquisition Event by a holder of the number of
shares of Common Stock which might have been purchased by the Holder immediately
prior to such Reclassification Event or Acquisition Event, and in any such case
appropriate provisions shall be made with respect to the rights and interest of
the Holder to the end that the provisions hereof (including without limitation,
provisions for the adjustment of the Purchase Price and the number of shares
issuable hereunder) shall thereafter be applicable in relation to any shares of
stock or other securities and property thereafter deliverable upon exercise
hereof.
12. Fractional Shares. In no event shall any fractional share of
Common Stock be issued upon any exercise of this Warrant. If, upon exercise of
this Warrant as an entirety, the Holder would, except as provided in this
Section 12, be entitled to receive a fractional share of Common Stock, then the
Company shall issue cash in lieu of any fraction of a share equal to such
fraction of the Current Value Per Share of one whole share of Common Stock as of
the date of the exercise of this Warrant.
13. Certificate of Adjustment. Whenever the Purchase Price is
adjusted, as herein provided, the Company shall promptly deliver to the Holder a
certificate of the Chief Financial Officer or Controller of the Company setting
forth the Purchase Price after such adjustment and setting forth a brief
statement of the facts requiring such adjustment.
14. Notices of Record Date, Etc. In the event of:
(a) any taking by the Company of 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 stock of any
class or any other securities or property, or to receive any other right,
(b) any reclassification of the capital stock of the Company, capital
reorganization of the Company, consolidation or merger involving the
Company, or sale or conveyance of all or substantially all of its assets,
or
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company, then and in each such event the Company will
mail or cause to be mailed to the Holder a notice specifying, as the case
may be, (i) the date on which any such record is to be taken for the
purpose of such dividend, distribution or right, and stating the amount and
character of such dividend, distribution or right, or (ii) the date on
which any such reclassification, reorganization, consolidation, merger,
sale or conveyance, dissolution, liquidation or winding-up is to take
place, and the time, if any is to be fixed, as of which the holders of
record in respect of such event are to be determined. Such notice shall be
mailed at least fifteen (15) days prior to the date specified in such
notice on which any such action is to be taken.
15. Amendment. The terms of this Warrant may be amended, modified or
waived only with the written consent of the Company and the holders of Warrants
representing at least two-thirds of the Warrants issued pursuant to the Purchase
Agreement (as calculated by the number of shares of Common Stock that would be
issuable upon the exercise of such Warrants). No such amendment, modification or
waiver shall be effective as to this Warrant unless the terms of such amendment,
modification or waiver shall apply with the same force and effect to all of the
other Warrants then outstanding.
16. Warrant Register; Transfers, Etc.
(a). The Company will maintain a register containing the names and
addresses of the registered holders of the Warrants. The Holder may change
its address as shown on the warrant register by written notice to the
Company requesting such change. Any notice or written communication
required or permitted to be given to the Holder may be given by certified
mail or delivered to the Holder at its address as shown on the warrant
register.
(b). Subject to compliance with applicable federal and state
securities laws, this Warrant may be transferred by the Holder with respect
to any or all of the shares purchasable hereunder. Upon surrender of this
Warrant to the Company, together with the assignment substantially in the
form attached hereto as Exhibit C hereof properly endorsed, for
transfer of this Warrant as an entirety by the Holder, the Company shall
issue a new warrant of the same denomination to the assignee. Upon
surrender of this Warrant to the Company, together with the assignment
hereof properly endorsed, by the Holder for transfer with respect to a
portion of the shares of Common Stock purchasable hereunder, the Company
shall issue a new warrant to the assignee, in such denomination as shall be
requested by the Holder hereof, and shall issue to such Holder a new
warrant covering the number of shares in respect of which this Warrant
shall not have been transferred.
(c). In case this Warrant shall be mutilated, lost, stolen or
destroyed, the Company shall issue a new warrant of like tenor and
denomination and deliver the same (i) in exchange and substitution for and
upon surrender and cancellation of any mutilated Warrant, or (ii) in lieu
of any Warrant lost, stolen or destroyed, upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft or destruction of
such Warrant and an agreement reasonably satisfactory to the Company to
indemnify the Company from any loss incurred by it in connection with such
Warrant.
17. No Rights or Liabilities as Stockholders. This Warrant shall not
entitle the Holder to any voting rights or other rights as a stockholder of the
Company.
18. No Impairment. The Company will not, by amendment of its Charter
or through any reclassification, capital reorganization, consolidation, merger,
sale or conveyance of assets, dissolution, liquidation, issue or sale of
securities 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 such terms and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the Holder.
19. Governing Law and Consent to Jurisdiction. The provisions and
terms of this Warrant shall be governed by and construed in accordance with the
internal laws of the State of New York, without giving effect to the conflict of
laws provisions thereof. The Company and the Holder agree that any dispute or
controversy arising out of this Warrant shall be adjudicated in a court located
in New York City, and hereby submits to the exclusive jurisdiction of the courts
of the State of New York located in New York, New York, and of the federal
courts in the Southern District of New York, and irrevocably waives any
objection it now or hereafter may have respecting the venue of such action or
proceeding brought in such a court or respecting the fact that such court is an
inconvenient forum, and consents to the service of process in any such action or
proceeding by means of registered or certified mail, return receipt requested,
to the address set forth below.
20. Successors and Assigns. This Warrant shall be binding upon the
Company's successors and assigns and shall be binding upon and inure to the
benefit of the Holder's successors, legal representatives and permitted assigns.
21. Headings. The headings in this Warrant are for purposes of
convenience in reference only, and shall not be deemed to constitute a part
hereof.
22. Severability. If any term, provision, covenant or restriction of
this Warrant is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
23. Counterparts. For the convenience of the parties, any number of
counterparts of this Warrant may be executed by the parties hereto and each such
executed counterpart shall be, and shall be deemed to be, an original
instrument.
24. Business Days. If the last or appointed day for the taking of
any action required or the expiration of any right granted herein shall be a
Saturday or Sunday or a legal holiday in the State of New York, then such action
may be taken or right may be exercised on the next succeeding day which is not a
Saturday or Sunday or such a legal holiday.
[signature page follows]
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by
its duly authorized officer to take effect as of the date first hereinabove
written.
AMERICANA PUBLISHING, INC.
By:
Name:
Title:
INVESTOR:
Signature:
Name: _______________________
Exhibit A
to Warrant
Subscription
To: Americana Publishing, Inc. Date:___________
The undersigned hereby subscribes for __________ shares of Common Stock
covered by this Class A Warrant. The certificate(s) for such shares shall be
issued in the name of the undersigned or as otherwise indicated below:
Signature
Name for Registration
Mailing Address
Exhibit B
to Warrant
Net Issue Election Notice
To: Americana Publishing, Inc. Date:___________
The undersigned hereby elects under Section 4 to surrender the right to
purchase _______ shares of Common Stock pursuant to this Class A Warrant.
The certificate(s) for the shares issuable upon such net issue election shall be
issued in the name of the undersigned or as otherwise indicated below.
Signature
Name for Registration
Mailing Address
Exhibit C
to Warrant
ASSIGNMENT
(To be executed only upon assignment of Warrant Certificate) CLASS A WARRANT NO.__
For value received, hereby sells, assigns and transfers unto
________________________ the within Class A Warrant, together with all
right, title and interest therein, and does hereby irrevocably constitute and
appoint ____________________________ attorney, to transfer said Class A
Warrant on the books of the within-named Company with respect to the number of
Class A Warrants set forth below, with full power of substitution in the
premises:
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Name(s) of Assignee(s) Address # of Warrants
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And if said number of Class A Warrants shall not be all the warrants represented
by the Class A Warrant, a new Class A Warrant is to be issued in the name of
said undersigned for the balance remaining of the Class A Warrants registered by
said Class A Warrant.
Dated:
Signature:
