EXHIBIT 99.1
THE WARRANTS MAY NOT BE ASSIGNED OR TRANSFERRED BY THE WARRANT HOLDER, EXCEPT
WITH THE COMPANY'S PRIOR WRITTEN CONSENT IN LIMITED CIRCUMSTANCES AS DESCRIBED
HEREIN, 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.
XXXXX.XXX, INC.
STOCK WARRANT AGREEMENT
11/16/01
WARRANT HOLDER: XXXXXXX X. XXXXXXX NO. OF SHARES: 36,000
THIS IS TO CERTIFY THAT, for good and valuable consideration received,
xxxxx.xxx, Inc. (the "Company"), a Georgia corporation and the holding company
for ebank (the "Bank"), hereby grants to the person identified above as the
Warrant Holder warrants (the "Warrants") to purchase the number of shares set
forth above. Such Warrants are granted on the following terms and conditions:
1. EXERCISE OF WARRANTS. The Warrants granted in this Agreement
may be exercised in whole or in part at any time beginning on or after the date
of this Agreement through the Expiration Date (defined below), subject to the
restrictions and conditions set forth in this Agreement.
(a) EXERCISE PRICE. The exercise price (the "Exercise Price")
shall be $3.50 per Share, subject to adjustment pursuant to
Section 2 below.
(b) EXPIRATION OF WARRANT TERM. The Warrants will expire on the
earlier of 5:00 p.m. Eastern Standard Time on the fifth
anniversary of the date of this Agreement, or 30 days after
the Company mails notice to the Warrant Holder that that the
closing price of the Company's common stock equaled or
exceeded $5.00 per shares for 20 consecutive trading days,
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, or by
cashless exercise as set forth below.
(d) CASHLESS EXERCISE.
(i) In lieu of the payment of the Exercise Price, the
Warrant Holder may propose to have the Company
convert the Warrant, in whole or in part,
into Shares of the Company as described below. The
Company has complete discretion whether to permit
the Warrant Holder to effect a cashless exercise. To
effect a cashless exercise, the Warrant Holder shall
request in writing that the Company deliver to the
Warrant Holder (without payment by the Warrant
Holder of any of the Exercise Price) and in
accordance with this Section 1 that amount of Common
Stock of the Company equal to the product of (x) the
number of Shares as to which the Warrant is being
exercised multiplied by (y) a fraction the numerator
of which is the per Share Market Price (as defined
herein) of the Common Stock less the Exercise Price
then in effect and the denominator of which is the
per Share Market Price (in each case adjusted for
fractional shares as herein provided). The Company
has no obligation to permit such cashless exercise
under any circumstances, and shall notify the
Warrant Holder within a reasonable time after
delivery of the notice whether it will honor such
request;
(ii) "Market Price" on any date shall mean (i) the
closing sales price of the Common Stock, regular
way, on such date on the national securities
exchange having the greatest volume of trading in
the Common Stock during the thirty-day period
preceding the day the value is to be determined or,
if such exchange was not open for trading on such
date, the next preceding date on which it was open;
(ii) if the Common Stock is not traded on any
national securities exchange, the average of the
closing high bid and low asked prices of the Common
Stock on the over-the-counter market on the day such
value is to be determined, or in the absence of
closing bids on such day, the closing bids on the
next preceding day on which there were bids; or
(iii) if the Common Stock also is not traded on the
over-the-counter market, the fair market value as
determined in good faith by the Board based on such
relevant facts as may be available to the Board,
which may include opinions of independent experts,
the price at which recent sales have been made, the
book value of the Common Stock, and the Company's
current and future earnings.
(e) 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);
(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
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(iii) Be accompanied by the originally executed copy of
this Stock Warrant Agreement.
(f) 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.
(g) 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 or banking 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 Office of
Thrift Supervision, the Federal Deposit Insurance Corporation
or any other state or federal banking regulatory agency with
regulatory authority over the operation of 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 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. RESTRICTIONS ON TRANSFERABILITY. The Warrants may not be
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
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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.
5. 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.
6. COVENANTS OF THE WARRANT HOLDER. The Warrant Holder
understands that this Warrant and the Common Stock issuable upon exercise of
the Warrant may not be sold, transferred or otherwise disposed of without
registration under the Securities Act of 1933, or an exemption therefrom, that
in the absence of an effective registration statement covering such shares or
an available exemption from registration under the Securities Act of 1933, such
shares must be held indefinitely, and that the certificates representing the
Shares will bear a legend to this effect. The holder understands that the
Shares are not registered under the Securities Act of 1933 on the ground that
the sale provided for in this Stock Warrant Agreement and the issuance of
securities hereunder is exempt from registration under the Securities Act of
1933 pursuant to Section 4(2) thereof, and that the Company's reliance on such
exemption is predicated in part on the Warrant Holder's representations set
forth herein. In the absence of an effective registration statement covering
the Shares, the Warrant Holder will sell, transfer or otherwise dispose of the
Shares only pursuant to an exemption from the requirements for registration
under the Securities Act of 1933. The Warrant Holder also acknowledges and
agrees that the resale of shares issuable upon exercise of the Warrant is
subject to the terms and conditions of a Registration Rights Agreement dated as
of the date hereof.
7. NO DILUTION OR IMPAIRMENT. The Company shall not amend its
Articles 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.
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8. AMENDMENT. Neither this Agreement nor the rights granted
hereunder may be amended, changed or waived except in writing signed by each
party hereto.
9. NOTICE. The address of record for Warrant Holder maintained
by the Company for all purposes of this Warrant Agreement and the Shares shall
be that address set forth beneath Warrant Holder's signature on the
Subscription Agreement. Warrant Holder may change his address of record only by
notifying the Company in the manner prescribed herein. All notices, requests,
and other communications required or permitted to be given or delivered
hereunder to either party must be in writing, and shall be personally
delivered, sent by certified or registered mail, postage prepaid or by
overnight courier such as Fedex to such party at the address of record. Any
notice under this Agreement or with respect to the Shares shall be deemed to
have been sufficiently given or served and effective for all purposes when
deposited with the United States Postal Service or overnight courier.
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.
XXXXX.XXX, INC.
By: /s/ Xxxxx X. Box
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Chief Executive Officer
(CORPORATE SEAL)
Attest: /s/ Xxxx X. Xxxxxxx
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Secretary
WARRANT HOLDER:
By: /s/ Xxxxxxx X. Xxxxxxx
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Signature
Xxxxxxx X. Xxxxxxx XXX
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Print Name
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