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EXHIBIT 4.9
FORM OF WARRANT
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES ACT OF ANY STATE (COLLECTIVELY, THE "ACTS"). NEITHER
THIS WARRANT NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED,
PLEDGED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT WITH RESPECT HERETO UNDER ALL THE APPLICABLE ACTS, OR AN OPINION OF
COUNSEL SATISFACTORY TO WATERMARC FOOD MANAGEMENT CO. TO THE EFFECT THAT SUCH
REGISTRATIONS ARE NOT REQUIRED. THIS WARRANT IS SUBJECT TO OTHER LIMITATIONS ON
TRANSFER.
WARRANT
to Purchase Common Stock of
WATERMARC FOOD MANAGEMENT CO.
Expiring on June 30, 2002
THIS IS TO CERTIFY THAT, for value received ______________, or
permitted assigns, is entitled to purchase, from the date hereof, from
WATERMARC FOOD MANAGEMENT CO., a Texas corporation (the "Company"), at the
place where the Warrant Office designated pursuant to Section 2.1 is located,
at a purchase price per share of $1.50 (the "Exercise Price"),
_________________ shares of duly authorized, validly issued, fully paid and
nonaccessable shares of Common Stock, $.05 par value, of the Company (the
"Common Stock"), and is entitled also to exercise the other appurtenant rights,
powers and privileges hereinafter set forth. The number of shares of the Common
Stock purchasable hereunder are subject to adjustment in accordance with
Article III hereof. This Warrant shall expire at 5:00 p.m., C.S.T. June 30,
2002.
Certain Terms used in this Warrant are defined in Article IV.
ARTICLE I
Exercise of Warrant
1.1 Method of Exercise. This Warrant may be exercised as a whole or in
part from the date hereof until June 30, 2002. To exercise this Warrant, the
holder hereof or permitted assignees of all rights of the registered owner
hereof shall deliver to the Company, at the Warrant Office designated in
Section 2.1, (a) a written notice in the form of the Subscription Notice
attached as an exhibit hereto, stating therein the election of such holder or
such permitted assignees of the holder to exercise this Warrant in the manner
provided in the Subscription Notice, (b) payment in full of the Exercise Price
(in the manner described below) for all Warrant Xxxxxx purchased hereunder, and
(c) this Warrant. This Warrant shall be deemed to be exercised on the date of
receipt by the Company of the Subscription Notice, accompanied by payment for
the Warrant Shares and surrender of this Warrant, as aforesaid, and such date
is referred to herein as the "Exercise Date". Upon such exercise (subject as
aforesaid), the Company shall issue and deliver to such holder a certificate
for the full number of the Warrant Shares.
1.2 Fractional Shares. Instead of any fractional shares of Common
Stock which would otherwise be issuable upon exercise of this Warrant no shares
will be issued for less than one-half a share and the Company shall issue a
certificate for the next higher number of whole shares of Common Stock for any
fraction of a share which is one-half or greater.
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ARTICLE II
Warrant Office: Transfer
2.1 Warrant Office The Company shall maintain an office for certain.
purposes specified herein (the "Warrant Office"), which office shall initially
be the Company's office at 00000 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx
00000 and may subsequently be such other office of the Company or of any
transfer agent of the Common Stock in the continental United States as to which
written notice has previously been given to the holder of this Warrant. The
Company shall maintain, at the Warrant Office, a register for the Warrant, in
which the Company shall record the name and address of the person in whose mine
this Warrant has been issued, as well as the name and address of each permitted
assignee of the rights of the registered owner hereof.
2.2 Ownership of Warrant. The Company may deem and treat the person in
whose name this Warrant is registered as the holder and owner hereof
(notwithstanding any notations of ownership or writing hereon made by anyone
other than the Company) for all purposes and shall not be affected by any notice
to the contrary, until presentation of this Warrant for registration of transfer
as provided in this Article II.
2.3 Restrictions on Exercise and Transfer of Warrants. The Company
agrees to maintain at the Warrant Office books for the registration and
transfer of this Warrant. Subject to the restrictions on transfer of Warrants
in this Section 2.3, the Company, from time to time, shall register the
transfer of this Warrant in such books upon surrender of this Warrant at the
Warrant Office properly endorsed or accompanied by appropriate instruments of
transfer and written instructions for transfer satisfactory to the Company.
Upon any such transfer, a new Warrant shall be issued to the transferee and the
surrendered Warrant shall be canceled by the Company. The Company shall pay all
taxes (other than securities transfer taxes) and all other expenses and charges
payable in connection with the transfer of Warrants pursuant to this Section
2.3.
(a) Restrictions in General. Notwithstanding any provisions
contained in this Warrant to the contrary, this Warrant shall not be
exercisable or transferable and the related shares of Common Stock issuable
upon exercise of this Warrant (the "Warrant Shares") shall not be transferable
except upon the conditions specified in this Section 2.3, which conditions are
intended, among other things, to insure compliance with the provisions of the
Securities Act in respect of the exercise or transfer of this Warrant or
transfer of such Warrant Shares. The registered holder of this Warrant agrees
that it will neither (i) transfer this Warrant prior to delivery to the Company
of the opinion of counsel referred to in, and to the effect described in,
clause (1) of Section 2.3(b), or until registration hereof under the Securities
Act and any applicable state securities or blue sky laws, (ii) exercise this
Warrant prior to delivery to the Company of the opinion of counsel referred to
in, and to the effect described in, clause (1) of Section 2.3(b), or until
registration of the related Warrant Shares under the Securities Act and any
applicable state securities or blue sky laws have become effective, nor (iii)
transfer such Warrant Shares prior to delivery to the Company of the opinion of
counsel referred to in, and to the effect described in clause (1) of Section
2.3(b), or until registration of such Warrant Shares under the Securities Act
and any applicable state securities or blue sky laws have become effective.
(b) Statement of Intention to Exercise; Opinion of Counsel. The
registered holder of this Warrant, by its acceptance hereof, agrees that prior
to any exercise or transfer of this Warrant or any transfer of the related
Warrant Shares, said holder will deliver to the Company a statement setting
forth either said holder's intention with respect to the retention or
disposition of any Warrant Shares, or the intention of said holder's
prospective transferee with respect to its retention or disposition of this
Warrant or of said Warrant Shares (whichever is involved in such transfer), in
either such case, together with a signed copy of the opinion of said holder's
counsel, or such other counsel as shall be acceptable to the Company, as to the
necessity or non-necessity for registration under the Securities Act and any
applicable state securities or blue sky laws in connection with such exercise
or such transfer. The following provisions shall then apply:
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(1) If, in the opinion of said holder's counsel, concurred in by
counsel to the Company, the proposed exercise or transfer of this Warrant
or the proposed transfer of such Warrant Shares may be effected without
registration under the Securities Act and any applicable state securities
or blue sky laws of this Warrant or such Warrant Shares, as the case may
be, then the registered holder of this Warrant shall be entitled to
exercise or transfer this Warrant or to transfer such Warrant Shares in
accordance with the statement of intention delivered by said holder to the
Company.
(2) If, in the opinion of said counsel, concurred in by counsel
to the Company, either the proposed exercise or transfer of this Warrant or
the proposed transfer of such Warrant Shares may not be effected without
registration under the Securities Act and any applicable state securities
or blue sky laws of this Warrant or such Warrant Shares, as the case may
be, the registered holder of this Warrant shall not be entitled to
exercise or transfer this Warrant or to transfer such Warrant Shares, as
the case may be, until such registration is effected.
2.4 Registration Rights. The registered holder of this Warrant shall
be entitled to all of the rights and benefits of a purchaser under the Purchase
Agreement dated __________, 1997 (the "Purchase Agreement"), among the Company
and the purchasers of the Company's 11% Subordinated Notes due June 30, 2002
(the "Notes") and the Warrants (as defined in the Purchase Agreement). The
Warrant Shares shall be considered Restricted Stock under the Purchase
Agreement. The terms of the Purchase Agreement are hereby incorporated herein
for all purposes and shall be considered a part of this Agreement as if they
had been fully set forth herein. The holder acknowledges that the Warrant is
being issued in connection with the purchase by the holder of the Notes
referred to in the Purchase Agreement entered into pursuant to, and which
constitutes part of, the Company's offering of Notes and Warrants pursuant to
the Company's Confidential Private Placement Memorandum dated June 1, 1997 (the
"Memorandum"). The terms, conditions, restrictions, risk factors and other
information contained in the Memorandum are incorporated by reference into and
constitute a part of the Purchase Agreement, the Notes and this Warrant.
2.5 Acknowledgement of Rights. The Company will, at the time of the
exercise of this Warrant in accordance with the terms hereof, upon the request
of the registered holder hereof, acknowledge in writing its continuing
obligation to afford to such holder any rights (including without limitation,
any right to registration of the Warrant Shares) to which such holder shall
continue to be entitled after such exercise in accordance with the provisions
of this Warrant, provided that if the holder of this Warrant shall fail to make
any such request, such failure shall not affect the continuing obligation of
the Company to afford to such holder any such rights.
2.6 Expenses of Delivery of Warrants. The Company shall pay all
expenses, taxes (other than transfer taxes) and other charges payable in
connection with the preparation, issuance and delivery of Warrants and related
Warrant Shares hereunder.
2.7 Compliance with Securities Laws. The holder hereof understands and
agrees that the following restrictions and limitations shall be applicable to
all Warrant Shares and resales or other transfers of such Shares pursuant to the
Securities Act.
(a) The holder hereof agrees that the Warrant Shares shall not be
sold or otherwise transferred unless the Warrant Shares are registered
under the Securities Act and state securities laws or are exempt therefrom.
(b) A legend in substantially the following form has been or will
be placed on the certificate(s) evidencing the Warrant Shares:
"The shares represented by this certificate have not been registered
under the Securities Act of 1933 or any state securities act. The shares
have been acquired for investment and may not be sold, transferred, pledged
or hypothecated unless (i) they shall have been registered under the
Securities Act of 1933 and any applicable state securities act, or (ii)
the corporation shall have been furnished with an
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opinion of counsel, satisfactory to counsel for the corporation, that
registration is not required under any of such acts."
(c) Stop transfer instructions have been or will be imposed with
respect to the Warrant Shares so as to restrict resale or other transfer
thereof, subject to this Section 2.7.
ARTICLE III
Warrant Adjustment Provisions
3.1 Adjustment of Warrant Shares. The Number of Warrant shares
purchasable upon exercise of this Warrant may be adjusted from time to time as
set forth below.
(a) If the Company at any time pays to the holders of its Common
Stock a dividend in Common Stock, the number of Warrant Shares
issuable upon the exercise of this Warrant shall be proportionally
increased, effective at the close of business on the record date for
determination of the holders of the Common Stock entitled to the
dividend.
(b) If the Company at any time subdivides or combines in a larger or
smaller number of shares its outstanding shares of Common Stock, then
the number of shares of Common Stock issuable upon the exercise of
this Warrant shall be proportionally increased in the case of a
subdivision and decreased in the case of combination, effective in
either case at the close of business on the date that the subdivision
or combination becomes effective.
(c) In case of any reclassification of the Common Stock, any
consolidation of the Company with, or merger of the Company into, any
other entity, any merger of any entity into the Company (other than a
merger which does not result in any reclassification, conversion,
exchange or cancellation of outstanding shares of Common Stock), any
sales or transfer of all or substantially all of the assets of the
Company, or any compulsory share exchange whereby the Common Stock is
converted into other securities, cash or other property, then
provisions shall be made such that the holders of this Warrant shall
have the right thereafter, during the period that this Warrant shall
be exercisable, to exercise this Warrant and receive the kind and
amount of securities, cash and other property receivable upon such
reclassification, consolidation, merger, sale, transfer or share
exchange by a holder of the number of shares of Common Stock issuable
upon exercise of this Warrant immediately prior to such
reclassification, consolidation, merger, sale, transfer or share
exchange. In addition to the adjustments provided for above to the
number of Warrant Shares purchasable hereunder upon exercise of the
Warrant in certain circumstances, the Company may, in its sole
discretion, provide for further adjustments to the number of Warrant
Shares purchasable hereunder and/or the Exercise Price thereof based
on additional or other facts and circumstances where the Company
determines that such an adjustment would be fair and equitable to the
holders of the Warrants.
3.2 Costs. The Company shall pay all documentary, stamp, transfer or
other transactional taxes attributable to the issuance or delivery of shares of
Common Stock of the Company upon exercise of this Warrant; provided, however
that the Company shall not be required to pay any taxes which may be payable in
respect of any transfer involved in the issuance or delivery of any certificate
for such shares in a name other than that of the holder of this Warrant in
respect of which such shares are being issued.
3.3 Reservations of Shares. Subject to an increase in the Company's
authorized or available shares of Common Stock for future issuance, the Company
shall reserve at all times so long as this Warrant remains outstanding, free
from preemptive rights, out of its treasury Common Stock or its authorized but
unissued shares
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of Common Stock, or both, solely for the purpose of effecting the exercise of
this Warrant, sufficient shares of Common Stock to provide for the exercise
hereof
3.4 Valid Issuance. All shares of Common Stock which may be issued
upon exercise of this Warrant will upon issuance by the Company be duly and
validly issued, fully paid and nonassessable and free from all taxes, liens and
charges with respect to the issuance thereof attributable to any act or
omission by the Company, and the Company shall take no action which will cause
a contrary result (including without limitation, any action which would cause
the Exercise Price to be less than the par value, if any, of the Common Stock).
ARTICLE IV
Terms Defined
As used in this Warrant, unless the context otherwise requires, the
following terms have the respective meanings set forth below or in the Section
indicated:
Board of Directors - the Board of Directors of the Company.
Common Stock - The Company's authorized Common Stock, par value $.05
per share.
Company - Watermarc Food Management Co., a Texas corporation, and any
other corporation assuming or required to assume the obligations undertaken in
connection with this Warrant
Person - any individual, corporation, partnership, trust,
organization, association or other entity or individual.
Securities Act - the Securities Act of 1933 and the rules and
regulations thereunder, all as the same shall be in effect at the time.
Warrant - this Warrant and any successor or replacement Warrant
delivered in accordance with Section 2.3 or 6.8.
Warrant Office - Section 2.1.
Warrant Shares - shall mean the shares of Common Stock purchased or
purchasable by the registered holder of this Warrant or the permitted assignees
of such holder upon exercise thereof pursuant to Article I hereof.
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ARTICLE V
Covenant of the Company
The Company covenants and agrees that this Warrant shall be binding
upon any corporation succeeding to the Company by merger, consolidation or
acquisition of all or substantially all of the Company's assets.
ARTICLE VI
Miscellaneous
6.1 Entire Agreement. This Warrant, the Purchase Agreement and the
Memorandum collectively contain and describe the entire agreement between the
holder hereof and the Company with respect to the shares which he can purchase
upon exercise hereof and the related transactions and supersedes all prior
arrangements or understanding with respect thereto.
6.2 Governing Law. This Warrant shall be governed by and construed in
accordance with the laws of the State of Texas.
6.3 Waiver and Amendment. Any term or provision of this Warrant may be
waived at any time by the party which is entitled to the benefits thereof and
any term or provision of this Warrant may be amended or supplemented at any
time by agreement of the holder hereof and the Company, except that any waiver
of any term or condition, or any amendment or supplementation, of this Warrant
must be in writing. A waiver of any breach or failure to enforce any of the
term or conditions of this Warrant shall not in any way affect, limit or waive a
party's rights hereunder at any time to enforce strict compliance thereafter
with every term or condition of this Warrant.
6.4 Illegality. In the event that any one or more of the provisions
contained in this Warrant shall be determined to be invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in any other respect and the remaining
provisions of this Warrant shall not, at the election of the party for whom the
benefit of the provisions exists, be in any way impaired.
6.5 Copy of Warrant. A copy of this Warrant shall be filed among the
records of the Company.
6.6 Notice. Any notice or other document required or permitted to be
given or delivered to the holder hereof shall be delivered at, or sent by
certified or registered mail to such holder at, the last address shown on the
books of the Company maintained at the Warrant Office for the registration of
this Warrant or at any more recent address of which the holder hereof shall
have notified the Company in writing. Any notice or other document required or
permitted to be given or delivered to the Company, other than such notice or
documents required to be delivered to the Warrant Office, shall be delivered
at, or sent by certified or registered mail to, the office of the Company at
00000 Xxxxxxxx Xxxxx Xxxxx 000, Xxxxxxx, Xxxxx 00000 or such other address
within the continental United States of America as shall have been furnished by
the Company to the holders of this Warrant
6.7 Limitation of Liability. Not Stockholders. No provision of this
Warrant shall be construed as conferring upon the holder hereof the right to
vote, consent, receive dividends or receive notices (other than as herein
expressly provided) in respect of meetings of stockholders for the election of
directors of the Company or any other right whatsoever as a stockholder of the
Company. No provision hereof, in the absence of affirmative action by the holder
hereof to purchase shares of Common Stock and no enumeration herein of the
rights or privileges of the holder hereof, shall give rise to any liability of
such holder for the purchase price of any shares of Common Stock or as a
stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.
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6.8 Exchange, Loss, Destruction, etc. of Warrant. Upon receipt of
evidence satisfactory to the Company of the loss, theft, mutilation or
destruction of this Warrant, and in the case of any such loss, theft or
destruction upon delivery of a bond of indemnity in such form and amount as
shall be reasonably satisfactory to the Company, or in the event of such
mutilation upon surrender and cancellation of this Warrant, the Company will
make and deliver a new Warrant of like tenor, in lieu of such lost, stolen,
destroyed or mutilated Warrant. Any Warrant issued under the provisions of this
Section 6.8 in lieu of any Warrant alleged to be lost, destroyed or stolen, or
in lieu of any mutilated Warrant, shall constitute an original contractual
obligation on the part of the Company. This Warrant shall be promptly canceled
by the Company upon the surrender hereof in connection with any exchange or
replacement. The Company shall pay all taxes (other than securities transfer
taxes) and all other expenses and charges payable in connection with the
preparation execution and delivery of Warrants pursuant to this Section 6.8.
6.9 Headings. The Article and Section and other headings herein are for
convenience only and are not a part of this Warrant and shall not affect the
interpretation thereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
in its name.
Dated: , 1997
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WATERMARC FOOD MANAGEMENT CO.
BY:
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Xxxxxx X. Xxxxxxxxxx
Chairman of the Board and
Chief Executive Officer
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SUBSCRIPTION NOTICE
The undersigned, the holder of the foregoing Warrant, hereby elects to
exercise purchase rights represented by said Warrant for, and to purchase
thereunder ______________________ shares of the Common Stock covered by said
Warrant and (Choose one option)
[ ] (i) herewith makes payments in full therefore pursuant to
Section 1.1 of such Warrant, or
[ ] (ii) elects the Conversion Right as set forth in Section 1.3 of the
Warrant
and requests (a) that certificates for such shares (and any securities or other
property issuable upon such exercise) be issued in the name of, and delivered
to, _______________________ and (b) if such shares shall not include all of the
shares issuable as provided in said Warrant, that a new Warrant of like tenor
and date for the balance of the shares issuable thereunder be delivered to the
undersigned.
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Dated: , 19
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ASSIGNMENT
For value received, ______________________, hereby sells, assigns and
transfers unto _____________________________ the within Warrant, together with
all right, title and interest therein and does hereby irrevocably constitute
and appoint _______________________ attorney, to transfer said Warrant on the
books of the Company, with full power of substitution.
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Dated: , 19
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