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EXHIBIT 3
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND MAY NOT BE SOLD, OFFERED FOR SALE, ASSIGNED, TRANSFERRED OR OTHERWISE
DISPOSED OF, UNLESS REGISTERED PURSUANT TO THE PROVISIONS OF THE SECURITIES ACT
OR AN OPINION OF COUNSEL IS OBTAINED STATING THAT SUCH DISPOSITION IS IN
COMPLIANCE WITH AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION.
Dated as of August 30, 2001
POWERCERV CORPORATION
(INCORPORATED UNDER THE LAWS OF THE STATE OF FLORIDA)
WARRANT FOR THE PURCHASE OF SHARES OF SERIES C CONVERTIBLE PREFERRED STOCK
FOR VALUE RECEIVED, POWERCERV CORPORATION, a Florida corporation (the
"Company"), hereby certifies that Xxxxx X. Xxxxx, Xx. or his permitted
registered assigns (the "Holder") is entitled, subject to the provisions of this
Warrant, to purchase from the Company 222,222 fully paid and non-assessable
shares of Preferred Stock (as defined below) at the exercise price per share of
$1.00 (the "Exercise Price"). This Warrant shall become exercisable immediately
on the date hereof.
The term "Preferred Stock" means the Series C Convertible Preferred
Stock, par value $.001 per share, of the Company as constituted on the date
hereof (the "Base Date"). The number of shares of Preferred Stock to be received
upon the exercise of this Warrant may be adjusted from time to time as
hereinafter set forth. The shares of Preferred Stock deliverable upon such
exercise, and as adjusted from time to time, are hereinafter referred to as
"Warrant Shares." The term "Other Securities" means any other equity or debt
securities that may be issued by the Company in addition thereto or in
substitution for the Warrant Shares. The term "Company" means and includes the
corporation named above as well as (i) any immediate or more remote successor
corporation resulting from the merger or consolidation of such corporation (or
any immediate or more remote successor corporation of such corporation) with
another corporation, or (ii) any corporation to which such corporation (or any
immediate or more remote successor corporation of such corporation) has
transferred its property or assets as an entirety or substantially as an
entirety.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of this Warrant, and (in the case
of loss, theft or destruction) of reasonably satisfactory indemnification, and
upon surrender and cancellation of this Warrant, if mutilated, the Company shall
execute and deliver a new Warrant of like tenor and date.
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The Holder agrees with the Company that this Warrant is issued, and all
the rights hereunder shall be held subject to, all of the conditions,
limitations and provisions set forth herein.
1. EXERCISE OF WARRANT. This Warrant may be exercised in whole or
in part, at any time, or from time to time during the period commencing
immediately on the date hereof and expiring 5:00 p.m. Eastern Time on August 30,
2002 (the "Expiration Date") or, if such day is a day on which banking
institutions in New York are authorized by law to close, then on the next
succeeding day that shall not be such a day, by presentation and surrender of
this Warrant to the Company at its principal office, or at the office of its
stock transfer agent, if any, with the Warrant Exercise Form attached hereto
duly executed and accompanied by payment (either in cash or by certified or
official bank check, payable to the order of the Company) of the Exercise Price
for the number of shares specified in such form and instruments of transfer, if
appropriate, duly executed by the Holder or its duly authorized attorney. If
this Warrant should be exercised in part only, the Company shall, upon surrender
of this Warrant for cancellation, execute and deliver a new Warrant evidencing
the rights of the Holder thereof to purchase the balance of the shares
purchasable hereunder. Upon receipt by the Company of this Warrant, together
with the Exercise Price, at its office, or by the stock transfer agent of the
Company at its office, in proper form for exercise, the Holder shall be deemed
to be the holder of record of the shares of Preferred Stock issuable upon such
exercise, notwithstanding that the stock transfer books of the Company shall
then be closed or that certificates representing such shares of Preferred Stock
shall not then be actually delivered to the Holder. The Company shall pay any
and all documentary stamp or similar issue or transfer taxes payable in respect
of the issue or delivery of shares of Preferred Stock on exercise of this
Warrant.
2. RESERVATION OF SHARES. The Company will at all times reserve
for issuance and delivery upon exercise of this Warrant all shares of Preferred
Stock or other shares of capital stock of the Company (and Other Securities)
from time to time receivable upon exercise of this Warrant. All such shares (and
Other Securities) shall be duly authorized and, when issued upon such exercise,
shall be validly issued, fully paid and non-assessable and free of all
preemptive rights.
3. FRACTIONAL SHARES. No fractional shares or script representing
fractional shares shall be issued upon the exercise of this Warrant, but the
Company shall pay the Holder an amount equal to the fair market value of such
fractional share of Preferred Stock in lieu of each fraction of a share
otherwise called for upon any exercise of this Warrant, as determined by the
Board of Directors of the Company.
4. EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant may not be transferred without the Company's prior written consent;
provided, however, that Xxxxx X. Xxxxx, Xx. may transfer this Warrant to a
single entity wholly owned or controlled by him without the Company's prior
consent. Subject to the foregoing, this Warrant is exchangeable, without
expense, at the option of the Holder, upon presentation and surrender hereof to
the Company or at the office of its stock transfer agent, if any, for other
Warrants of different denominations, entitling the Holder or Holders thereof to
purchase in the aggregate the same number of shares of Preferred Stock
purchasable hereunder. Upon surrender of this Warrant to the Company with the
Assignment Form annexed hereto duly executed in favor of a permitted assignee
and
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accompanied by funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other Warrants that carry
the same rights upon presentation hereof at the office of the Company or at the
office of its stock transfer agent, if any, together with a written notice
specifying the names and denominations in which new Warrants are to be issued
and signed by the Holder hereof.
5. RIGHTS OF THE HOLDER. The Holder shall not, by virtue hereof,
be entitled to any rights as a shareholder in the Company, either at law or in
equity, and the rights of the Holder are limited to those expressed in this
Warrant.
6. CERTAIN ADJUSTMENTS. The Exercise Price and number of Warrant
Shares issuable upon exercise of this Warrant are subject to adjustment from
time to time as set forth in this Section 6. Upon each such adjustment of the
Exercise Price pursuant to this Section 6, the Holder shall thereafter prior to
the Expiration Date be entitled to purchase, at the Exercise Price resulting
from such adjustment, the number of Warrant Shares obtained by multiplying the
Exercise Price in effect immediately prior to such adjustment by the number of
Warrant Shares issuable upon exercise of this Warrant immediately prior to such
adjustment and dividing the product thereof by the Exercise Price resulting from
such adjustment.
6.1 If the Company, at any time while this Warrant is
outstanding and to the extent provided for in the terms of the Preferred Stock,
(i) shall pay a stock dividend (except scheduled dividends paid on any class or
series of capital stock that contains a stated dividend rate) or otherwise make
a distribution or distributions on shares of the Preferred Stock or on any
other class of capital stock payable in shares of capital stock, (ii) subdivide
outstanding shares of Preferred Stock into a larger number of shares, or (iii)
combine outstanding shares of Preferred Stock into a smaller number of shares,
the Exercise Price shall be multiplied by a fraction of which the numerator
shall be the number of shares of Preferred Stock (excluding treasury shares, if
any) outstanding before such event and of which the denominator shall be the
number of shares of Preferred Stock (excluding treasury shares, if any)
outstanding after such event. Any adjustment made pursuant to this Section
shall become effective immediately after the record date for the determination
of shareholders entitled to receive such dividend or distribution and shall
become effective immediately after the effective date in the case of a
subdivision or combination, and shall apply to successive subdivisions and
combinations.
6.2 In case of any reclassification of the Preferred
Stock or any compulsory share exchange pursuant to which the Preferred Stock is
converted into other securities, cash or property (except for a conversion of
the Preferred Stock in accordance with the terms thereof), then the Holder
shall have the right thereafter to exercise this Warrant only into the shares
of stock and other securities and property receivable upon or deemed to be held
by holders of Preferred Stock following such reclassification or share
exchange, and the Holder shall be entitled upon such event to receive such
amount of securities or property equal to the amount of Warrant Shares such
Holder would have been entitled to had such Holder exercised this Warrant
immediately prior to such reclassification or share exchange. The terms of any
such reclassification or share exchange shall include such terms so as to
continue to give to the Holder
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the right to receive the securities or property set forth in this Section 6.2
upon any exercise following any such reclassification or share exchange.
6.3 If the Company, at any time while this Warrant is
outstanding, shall distribute to all holders of Preferred Stock (and not to
holders of this Warrant) evidences of its indebtedness or assets or rights or
warrants to subscribe for or purchase any security (excluding those referred to
in Sections 6.1 and 6.2), then in each such case the Exercise Price shall be
determined by multiplying the Exercise Price in effect immediately prior to the
record date fixed for determination of shareholders entitled to receive such
distribution by a fraction of which the denominator shall be the Exercise Price
determined as of the record date mentioned above, and of which the numerator
shall be such Exercise Price on such record date less the then fair market
value at such record date of the portion of such assets or evidence of
indebtedness so distributed applicable to one outstanding share of Preferred
Stock as determined by the Company's independent certified public accountants
that regularly examine the financial statements of the Company.
6.4 In case of any (i) merger or consolidation of the
Company with or into another person, or (ii) sale by the Company of
substantially all of the assets of the Company in one or a series of related
transactions, the Holder shall have the right thereafter to exercise this
Warrant for the shares of stock and other securities, cash and property
receivable upon or deemed to be held by holders of Preferred Stock following
such merger, consolidation or sale, and the Holder shall be entitled upon such
event or series of related events to receive such amount of securities, cash
and property as the Preferred Stock for which this Warrant could have been
exercised immediately prior to such merger, consolidation or sale would have
been entitled. The terms of any such merger, consolidation or sale shall
include such terms so as to give the Holder the right to receive the
securities, cash and property set forth in this Section upon any conversion or
redemption following such event. This provision shall similarly apply to
successive such events.
6.5 For the purposes of this Section 6, in case the
Company shall take a record of the holders of its Preferred Stock for the
purpose of entitling them (i) to receive a dividend or other distribution
payable in capital stock or in securities convertible or exchangeable into
shares of capital stock, or (ii) to subscribe for or purchase capital stock or
securities convertible or exchangeable into shares of capital stock, then such
record date shall be deemed to be the date of the issue or sale of the shares
of capital stock deemed to have been issued or sold upon the declaration of
such dividend or the making of such other distribution or the date of the
granting of such right of subscription or purchase, as the case may be, if such
issuance or sale of such shares of capital stock actually occurs. The Company
shall provide to the Holder of this Warrant notice of all such record dates as
though the Holder were a record holder of Preferred Stock on each such record
date.
6.6 All calculations under this Section 6 shall be made
to the nearest cent or the nearest whole share, as the case may be.
7. TRANSFER TO COMPLY WITH THE SECURITIES ACT. This Warrant and
any Warrant Share or Other Securities may not be sold, transferred, pledged,
hypothecated or otherwise disposed of unless registered under the Securities Act
and any applicable state securities laws or
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pursuant to available exemptions from such registration, provided that the
transferor delivers to the Company an opinion of counsel satisfactory to the
Company confirming the availability of such exemption.
8. LEGEND. Unless Warrant Shares or Other Securities have been
registered under the Securities Act, upon exercise of the Warrant and the
issuance of any of Warrant Shares or Other Securities, all certificates
representing such securities shall bear on the face thereof substantially the
following legend:
The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended, or under applicable state
securities laws and may not be sold, offered for sale, assigned,
transferred or otherwise disposed of, unless registered pursuant to the
provisions of that Act and any applicable state securities laws or
unless an opinion of counsel to the Company is obtained stating that
such disposition is in compliance with an available exemption from such
registration.
9. NOTICES. All notices required hereunder shall be in writing
and shall be deemed given when telecopied, delivered personally or within two
days after mailing when mailed by certified or registered mail, return receipt
requested, to the Company at its principal office, or to the Holder at the
address set forth on the record books of the Company, or at such other address
of which the Company or the Holder has been advised by notice hereunder.
10. APPLICABLE LAW. The Warrant is issued under and shall for all
purposes be governed by and construed in accordance with the laws of the State
of Florida, without giving effect to the choice of law rules thereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed on
its behalf, in its corporate name, by its duly authorized officer, all as of the
day and year first above written.
POWERCERV CORPORATION,
a Florida corporation
By:
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Xxxx X. Xxxxxxxx, Chief Executive Officer
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WARRANT EXERCISE FORM
THE UNDERSIGNED hereby irrevocably elects to exercise the within
Warrant to the extent of purchasing ________________ shares of Preferred Stock
of PowerCerv Corporation, a Florida corporation, at an exercise price of
$__________ per share, and hereby makes payment of an aggregate of
$_______________ in payment therefor.
By:
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Signature
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Name
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Title
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Date
INSTRUCTIONS FOR ISSUANCE OF STOCK
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(IF OTHER THAN TO THE REGISTERED HOLDER OF THE WITHIN WARRANT)
Name
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(Please typewrite or print in block letters)
Address
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Social Security or
Taxpayer Identification Number
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ASSIGNMENT FORM
FOR VALUE RECEIVED,
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hereby sells, assigns, and transfers unto
Name
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(Please typewrite or print in block letters)
the right to purchase Preferred Stock of PowerCerv Corporation, a Florida
corporation, represented by this Warrant to the extent of shares as to which
such right is exercisable and does hereby irrevocably constitute and appoint
__________________ Attorney, to transfer the same on the books of the Company
with full power of substitution in the premises.
Dated:____________________________
By:
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Signature
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Name
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Title
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