EXHIBIT 10.39
WARRANT
October 27, 2005
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE
SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH
ACT AND SUCH LAWS.
Warrant to Purchase
55,853
Shares (subject to adjustment)
of Common Stock
XX XXXX'X CORPORATION
COMMON STOCK PURCHASE WARRANT
Void after October 27, 2015
XX Xxxx'x Corporation (the "Company"), a Delaware corporation, hereby
certifies that for value received, AEA Mezzanine (Unleveraged) Fund LP, a
Delaware limited partnership, or its successors or assigns (the "Holder"), is
entitled to purchase, subject to the terms and conditions hereinafter set forth,
an aggregate of 55,853 fully paid and nonassessable shares of Common Stock (as
hereinafter defined) of the Company, at an exercise price of $5.30 per share,
subject to adjustment as provided herein (the "Purchase Price"), at any time or
from time to time beginning on the date hereof and prior to 5:00 p.m., New York
City time, on October 27, 2015 (the "Expiration Date").
This Warrant is issued pursuant to the Securities Purchase Agreement (the
"Purchase Agreement"), dated as of October 12, 2005, by and among XX Xxxx'x
Incorporated, Plant Engineering Consultants, LLC, XX Xxxx'x Enterprises, Inc.,
AEA Mezzanine Funding LLC, AEA Mezzanine Fund LP, AEA Mezzanine (Unleveraged)
Fund LP, Company, and X.X. Xxxx'x Canada Ltd., and is subject to the terms
thereof. Capitalized terms used herein and not otherwise defined shall have the
respective meanings assigned to such terms in the Purchase Agreement. The Holder
is entitled to the rights and subject to the obligations contained in the
Purchase Agreement, the Co-Sale Agreement and the Registration Rights Agreement
relating to this Warrant and the shares of Common Stock issuable upon exercise
of this Warrant.
1. Definitions. For the purposes of this Warrant, the following terms shall
have the meanings indicated below:
"Applicable Price" shall mean the higher of (a) the Current Market Price
per share of Common Stock and (b) the Purchase Price on the relevant date.
"Business Day" shall mean any day other than a Saturday, Sunday or other
day on which commercial banks in the City of New York are authorized or required
by law or executive order to close.
"Closing Price" shall mean, with respect to each share of Common Stock for
any day, (a) the last reported sale price regular way or, in case no such sale
takes place on such day, the average of the closing bid and asked prices regular
way, in either case as reported on the principal national securities exchange on
which the Common Stock is listed or admitted for trading or (b) if the Common
Stock is not listed or admitted for trading on any national securities exchange,
the last reported sale price or, in case no such sale takes place on such day,
the average of the highest reported bid and the lowest reported asked quotation
for the Common Stock, in either case as reported on the Nasdaq or a similar
service if Nasdaq is no longer reporting such information.
"Co-Investor Warrants" shall mean all warrants, other than the Warrant, to
purchase Common Stock issued pursuant to the Purchase Agreement and any
subsequent warrants issued pursuant to the terms of such warrants.
"Common Stock" means the common stock, par value $.01 per share, of the
Company, and any class of stock resulting from successive changes or
reclassification of such Common Stock.
"Company" has the meaning ascribed to such term in the first paragraph of
this Warrant.
"Current Market Price" shall be determined in accordance with Subsection
3(e).
"Exercise Date" has the meaning ascribed to such term in Subsection 2(d).
"Expiration Date" has the meaning ascribed to such term in the first
paragraph of this Warrant.
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"Holder" has the meaning ascribed to such term in the first paragraph and
Section 9 of this Warrant.
"Issuable Warrant Shares" means the shares of Common Stock issuable upon
exercise of the Warrant.
"Issued Warrant Shares" means any shares of Common Stock issued upon
exercise of the Warrant.
"Nasdaq" shall mean the Automated Quotation System of the National
Association of Securities Dealers, Inc.
"Person" shall mean any individual, firm, corporation, limited liability
company, partnership, trust, incorporated or unincorporated association, joint
venture, joint stock company, government (or an agency or political subdivision
thereof) or other entity of any kind, and shall include any successor (by merger
or otherwise) of such entity.
"Purchase Agreement" has the meaning ascribed to such term in the second
paragraph of this Warrant.
"Purchase Price" has the meaning ascribed to such term in the first
paragraph of this Warrant, as adjusted in accordance with the terms of Section
3.
"Warrant" shall mean this Warrant and any subsequent Warrant issued
pursuant to the terms of this Warrant.
"Warrant Register" has the meaning ascribed to such term in Subsection
9(c).
2. Exercise of Warrant.
(a) Exercise. This Warrant may be exercised, in whole or in part, at
any time or from time to time during the period beginning on the date hereof and
ending on the Expiration Date, by surrendering to the Company at its principal
office this Warrant, with the form of Election to Purchase Shares (the "Election
to Purchase Shares") attached hereto as Exhibit A duly executed by the Holder
and accompanied by payment of the Purchase Price for the number of shares of
Common Stock specified in such form.
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(b) Delivery of Shares; Payment of Purchase Price. (i) As soon as
practicable after surrender of this Warrant and receipt of payment, the Company
shall promptly issue and deliver to the Holder a certificate or certificates for
the number of shares of Common Stock set forth in the Election to Purchase
Shares, in such name or names as may be designated by such Holder, along with a
check for the amount of cash to be paid in lieu of issuance of fractional
shares, if any. Payment of the Purchase Price may be made as follows (or by any
combination of the following): (A) in United States currency by cash or delivery
of a certified check, bank draft or postal or express money order payable to the
order of the Company, (B) by assigning to the Company all or any part of the
unpaid principal amount of the Note held by the Holder in a principal amount
equal to the Purchase Price, or (C) by surrender of a number of shares of Common
Stock held by the Holder equal to the quotient obtained by dividing (x) the
aggregate Purchase Price payable with respect to the portion of this Warrant
then being exercised by (y) the Current Market Price per share of Common Stock
on the Exercise Date.
(ii) Alternative Cashless Exercise. Notwithstanding any
provision herein to the contrary, in lieu of exercising this Warrant as set
forth above, the Holder may exercise this Warrant, in whole or in part, by
electing to receive that number of shares of Common Stock as determined below by
surrendering to the Company at its principal office this Warrant, with the
applicable Election to Purchase Shares duly executed by the Holder, in which
event the Company shall issue to the Holder the number of shares of Common Stock
computed using the following formula:
CS = WCS x (MP-PP)
-------------
MP
where:
CS equals the number of shares of Common Stock to be issued to the
Holder
WCS equals the Issuable Warrant Shares purchasable under the Warrant
MP equals the Common Stock Current Market Price per share (on the
Exercise Date)
PP equals the Purchase Price
Following the surrender of this Warrant pursuant to this Section 2(b)(ii), the
Company shall promptly issue and deliver to the Holder a certificate or
certificates for that number of shares of Common Stock, as calculated above in
such name or names as may be designated by the Holder.
(c) Partial Exercise. If this Warrant is exercised for less than all
of the shares of Common Stock purchasable under this Warrant, the Company shall
cancel this Warrant upon surrender hereof and shall execute and deliver to the
Holder a new Warrant of like tenor for the balance of the shares of Common Stock
purchasable hereunder.
(d) When Exercise Effective. The exercise of this Warrant shall be
deemed to have been effective immediately prior to the close of business on the
Business Day on which this Warrant is surrendered to and the Purchase Price is
received by the Company as provided in this Section 2 (the "Exercise Date") and
the Person in whose name any certificate for shares of Common Stock shall be
issuable upon such exercise, as provided in Subsection 2(b), shall be deemed to
be the record holder of such shares of Common Stock for all purposes on the
Exercise Date.
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(e) Issued Warrant Shares Fully Paid, Nonassessable. The Company shall
take all actions necessary to ensure that following exercise of this Warrant in
accordance with the provisions of this Section 2, the Issued Warrant Shares
issued hereunder shall, without further action by the Holder, be fully paid and
nonassessable.
(f) Continued Validity. A Holder of shares of Common Stock issued upon
the exercise of this Warrant, in whole or in part, shall continue to be entitled
to all of the rights and subject to all of the obligations set forth in Section
9.
3. Adjustment of Purchase Price and Number of Shares. The Purchase Price
and the number of shares of Common Stock issuable upon exercise of this Warrant
shall be adjusted from time to time in the following manner upon the occurrence
of the following events:
(a) Dividend, Subdivision, Combination or Reclassification of Common
Stock. If the Company shall, at any time or from time to time, after October 12,
2005, (i) declare a dividend on the Common Stock payable in shares of its
capital stock (including Common Stock), (ii) subdivide the outstanding Common
Stock into a larger number of shares of Common Stock, (iii) combine the
outstanding Common Stock into a smaller number of shares of its Common Stock, or
(iv) issue any shares of its capital stock in a reclassification of the Common
Stock (including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing corporation), then in each such
case, the Purchase Price in effect at the time of the record date for such
dividend or of the effective date of such subdivision, combination or
reclassification, and the number and kind of shares of capital stock issuable on
such date shall be proportionately adjusted so that the Holder of any Warrant
exercised after such date shall be entitled to receive, upon payment of the same
aggregate amount as would have been payable before such date, the aggregate
number and kind of shares of capital stock which, if such Warrant had been
exercised immediately prior to such date, such Holder would have owned upon such
exercise and been entitled to receive by virtue of such dividend, subdivision,
combination or reclassification. Any such adjustment shall become effective
immediately after the record date of such dividend or the effective date of such
subdivision, combination or reclassification. Such adjustment shall be made
successively whenever any event listed above shall occur. If a dividend is
declared and such dividend is not paid, the Purchase Price shall again be
adjusted to be the Purchase Price and number and kind of shares of capital
stock, in effect immediately prior to such record date (giving effect to all
adjustments that otherwise would be required to be made pursuant to this Section
3 from and after such record date).
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(b) Issuance of Rights to Purchase Common Stock Below Current Market
Price or Purchase Price. If the Company shall, at any time or from time to time,
after October 12, 2005, fix a record date for the issuance of rights, options or
warrants to all holders of Common Stock entitling them to subscribe for or
purchase Common Stock, or securities convertible into or exchangeable for Common
Stock at a price per share of Common Stock or having a conversion price per
share of Common Stock if a security is convertible into or exchangeable for
Common Stock (determined in either such case by dividing (x) the total
consideration payable to the Company upon exercise, conversion or exchange of
such rights, options, warrants or other securities convertible into or
exchangeable for Common Stock by (y) the total number of shares of Common Stock
covered by such rights, options, warrants or other securities convertible into
or exchangeable for Common Stock) which is lower than either the Current Market
Price per share of Common Stock on such record date (or, if an ex-dividend date
has been established for such record date, on the day next preceding such
ex-dividend date) or the Purchase Price, then, the Purchase Price shall be
reduced to the price determined by multiplying the Purchase Price in effect on
such record date by a fraction, the numerator of which shall be the sum of the
number of shares of Common Stock outstanding on such record date plus the number
of additional shares of Common Stock which the aggregate offering price of the
total number of shares of Common Stock so to be offered (or the aggregate
initial conversion price of the convertible securities so to be offered) would
purchase at the Applicable Price in effect immediately prior to such record date
and the denominator of which shall be the number of shares of Common Stock
outstanding on such record date plus the number of additional shares of Common
Stock to be offered for subscription or purchase (or into which the convertible
securities to be so offered are initially convertible). In case such price for
subscription or purchase may be paid in a consideration part or all of which
shall be in a form other than cash, the value of such consideration shall be
determined in good faith by the Board of Directors of the Company. Any such
adjustment shall become effective immediately after the record date for such
rights or warrants. Such adjustment shall be made successively whenever such a
record date is fixed. If such rights or warrants are not issued, or expire or
terminate without the exercise of such rights or warrants and no securities are
issued pursuant thereto, the Purchase Price shall be adjusted to the Purchase
Price that otherwise would be in effect but for the fact that such record date
had been fixed.
(c) Certain Distributions. If the Company shall, at any time or from
time to time, after October 12, 2005, fix a record date for the distribution to
all holders of Common Stock (including any such distribution made in connection
with a consolidation or merger in which the Company is the continuing
corporation) of evidences of indebtedness, assets or other property (other than
dividends payable in capital stock for which adjustment is made under Subsection
3(a)) or subscription rights, options or warrants (excluding those referred to
in Subsection 3(b)), then the Purchase Price shall be reduced to the price
determined by multiplying the Purchase Price in effect immediately prior to such
record date by a fraction (which shall in no event be less than zero), the
numerator of which shall be the Current Market Price per share of Common Stock
on such record date (or, if an ex-dividend date has been established for such
record date, on the next day preceding such ex-dividend date), less the fair
market value (as determined in good faith by the Board of Directors of the
Company) of the portion of the assets, evidences of indebtedness, other
property, subscription rights or warrants so to be distributed applicable to one
share of Common Stock and the denominator of which shall be such Current Market
Price per share of Common Stock. Any such adjustment shall become effective
immediately after the record date for such distribution. Such adjustments shall
be made successively whenever such a record date is fixed. In the event that
such distribution is not so made, the Purchase Price shall be adjusted to the
Purchase Price in effect immediately prior to such record date (giving effect to
all adjustments that otherwise would be required to be made pursuant to this
Section 3 from and after such record date).
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(d) Issuance of Common Stock Below Current Market Price or Purchase
Price.
(i) If the Company shall, at any time and from time to time,
after October 12, 2005, directly or indirectly, sell or issue shares of Common
Stock (regardless of whether originally issued or from the Company's treasury),
or rights, options, warrants (other than this Warrant or any Co-Investor
Warrant) or convertible or exchangeable securities containing the right to
subscribe for or purchase shares of Common Stock) at a price per share of Common
Stock (determined, in the case of rights, options, warrants or convertible or
exchangeable securities (collectively, "Securities"), by dividing (x) the total
consideration received or receivable by the Company in consideration of the sale
or issuance of such Securities, plus the total consideration payable to the
Company upon exercise or conversion or exchange thereof, by (y) the total number
of shares of Common Stock covered by such Securities) which is lower than either
the Current Market Price per share of Common Stock or the Purchase Price in
effect immediately prior to such sale or issuance, then, subject to clause
3(d)(ii), the Purchase Price shall be reduced to a price determined by
multiplying the Purchase Price in effect immediately prior thereto by a
fraction, the numerator of which shall be the sum of the number of shares of
Common Stock outstanding immediately prior to such sale or issuance plus the
number of shares of Common Stock which the aggregate consideration received (in
the case of Securities, determined as provided below) for such sale or issuance
would purchase at the Applicable Price in effect immediately prior to such sale
or issuance and the denominator of which shall be the total number of shares of
Common Stock outstanding immediately after such sale or issuance. Such
adjustment shall be made successively whenever such sale or issuance is made.
For the purposes of such adjustments, the shares of Common Stock which the
holder of any such Securities shall be entitled to subscribe for or purchase
shall be deemed to be issued and outstanding as of the date of such sale or
issuance of such Securities and the consideration "received" by the Company
therefor shall be deemed to be the consideration actually received or receivable
by the Company (plus any underwriting discounts or commissions in connection
therewith) for such Securities, plus the consideration stated in such Securities
to be payable to the Company for the shares of Common Stock covered thereby. If
the Company shall sell or issue shares of Common Stock for a consideration
consisting, in whole or in part, of property other than cash or its equivalent,
then in determining the "price per share of Common Stock" and the
"consideration" received or receivable by or payable to the Company for purposes
of the first sentence and the immediately preceding sentence of this Subsection
3(d)(i), the fair value of such property shall be determined in good faith by
the Board of Directors of the Company. Except as provided below, the
determination of whether any adjustment is required under this Subsection
3(d)(i) by reason of the sale or issuance of Securities and the amount of such
adjustment, if any, shall be made only at the time of such issuance or sale and
not at the subsequent time of issuance of shares of Common Stock upon the
exercise, conversion or exchange of such Securities.
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(ii) No adjustment shall be made to the Purchase Price pursuant
to clause 3(d)(i) in connection with the (A) issuance of securities in any of
the transactions described in Subsections 3(a), (b) and (c) hereof; (B) issuance
of shares of Common Stock upon exercise of this Warrant or the Co-Investor
Warrants; (C) issuance of shares of Common Stock upon the exercise of Management
Options (as defined in the Purchase Agreement) or the grant of Management
Options provided that the aggregate number of shares of Common Stock issued and
issuable pursuant to all Management Options does not exceed 700,000 shares of
Common Stock (subject to appropriate adjustment for the events set forth in
Section 3(a)); (D) issuance of up to 25,000 shares of Common Stock (subject to
appropriate adjustment for the events set forth in Section 3(a)) per calendar
year under the XX Xxxxx' Corporation Employee Stock Purchase Plan, dated March
1, 1997, as such plan is in effect on the date hereof; (E) issuance of shares of
Common Stock to the Company's 401(k) plan to fund Company matching contributions
pursuant to the Company's 401(k) plan, as in effect on the date hereof, provided
that the amount of matching contribution satisfied by the issuance of each such
share shall not be less than the then Current Market Price per share of Common
Stock; and (F) issuance of up to 370,000 shares of Common Stock (subject to
appropriate adjustment for the events set forth in Section 3(a)) pursuant to any
acquisition by the Company or any of its Subsidiaries (as defined in the
Purchase Agreement) by merger or an exchange transaction, provided that (1) the
issuance of such shares of Common Stock shall have been registered under the
Securities Act on a Form S-1, S-2, S-3 or S-4 or any successor form, and (2)
such shares of Common Stock shall have been issued as consideration in such
transaction on terms approved by the Board, and the Board shall have received a
fairness opinion from a reputable investment banking firm that such transaction
is fair to the Company and its stockholders.
(iii) In the event of any change in the number of shares of
Common Stock deliverable or any change in the consideration payable to the
Company upon exercise, conversion or exchange of any Securities (including,
without limitation, by operation of the anti-dilution provisions of such
Securities other than those anti-dilution provisions contained within the
Securities that are substantially similar to the provisions of Section 3(a)
hereof), any adjustment to the Purchase Price which was made upon the issuance
of such Securities, and any subsequent adjustments based thereon, shall be
recomputed to reflect such change and, except as provided below, no further
adjustment shall be made for the actual issuance of Common Stock or any payment
of such consideration upon the exercise, conversion or exchange of any such
Securities. The Company shall make all necessary adjustments (including
successive adjustments if required) to the Purchase Price in accordance with
Section 3. Upon the expiration or termination of the right to exercise, convert
or exchange any Securities, any adjustment to the Purchase Price which was made
upon the issuance of such Securities, and any subsequent adjustments based
thereon, shall be recomputed to reflect the issuance of only the number of
shares of Common Stock actually issued upon the exercise, conversion or exchange
of such Securities and the actual consideration received therefor (as determined
in this Section 3).
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(e) Determination of Current Market Price. For the purpose of any
computation under Subsections (b), (c) or (d) of this Section 3 or any other
provision of this Warrant, the Current Market Price per share of Common Stock on
any date shall be deemed to be the average of the daily Closing Prices per share
of Common Stock for the 10 consecutive trading days commencing 15 trading days
before such date. If on any such date the shares of Common Stock are not listed
or admitted for trading on any national securities exchange or quoted by Nasdaq
or a similar service, then the Company, on the one hand, and Purchasers on the
other hand, shall each promptly appoint as an appraiser an individual who shall
be a member of a nationally recognized investment banking firm. Each appraiser
shall be instructed to, within 30 days of appointment, determine the Current
Market Price per share of Common Stock which shall be deemed to be equal to the
fair market value per share of Common Stock as of such date. If the two
appraisers are unable to agree on the Current Market Price per share of Common
Stock within such 30 day period, then the two appraisers, within 10 days after
the end of such 30 day period shall jointly select a third appraiser. The third
appraiser shall, within 30 days of its appointment, determine, in good faith,
the Current Market Price per share of Common Stock and such determination shall
be controlling. If any party fails to appoint an appraiser or if one of the two
initial appraisers fails after appointment to submit its appraisal within the
required period, the appraisal submitted by the remaining appraiser shall be
controlling. The cost of the foregoing appraisals shall be shared one-half by
the Company and one-half by Purchasers, provided, however, in the event a third
appraiser is utilized and one of the two initial appraisals (but not the other
initial appraisal) is greater than or less than the appraisal by such third
appraiser by 10% or more, then the cost of all of the foregoing appraisals shall
be borne by the party who appointed the appraiser who made such initial
appraisal.
(f) De Minimis Adjustments. No adjustment shall be made under this
Section 3 if the amount of such adjustment would result in a change in the
number of shares issuable under this Warrant of less than one percent (1%), but
in such case any adjustment that would otherwise be required to be made shall be
carried forward and shall be made at the time of and together with the next
subsequent adjustment, which together with any adjustment so carried forward,
would result in a change of at least one percent (1%). Notwithstanding the
provisions of the first sentence of this Subsection 3(f), any adjustment
postponed pursuant to this Subsection 3(f) shall be made no later than the
earlier of (i) three years from the date of the transaction that would, but for
the provisions of the first sentence of this Section 3(f), have required such
adjustment, (ii) an Exercise Date or (iii) the Expiration Date.
(g) Adjustments to Other Shares. In the event that at any time, as a
result of an adjustment made pursuant to Subsection 3(a), the Holder shall
become entitled to receive, upon exercise of this Warrant, any shares of capital
stock or other securities of the Company other than shares of Common Stock, the
number of such other shares or other securities so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions with respect to the
shares of Common Stock contained in Subsections 3(a), (b), (c) and (d),
inclusive, and the provisions of Sections 2, 5, 6 and 7 with respect to the
shares of Common Stock shall apply on like terms to any such other shares or
other securities.
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(h) Adjustment of Number of Shares Issuable Upon Exercise. Upon each
adjustment of the Purchase Price as a result of the calculations made in
Subsections 3(a), (b), (c) or (d), this Warrant shall thereafter evidence the
right to receive, at the adjusted Purchase Price, that number of shares of
Common Stock (calculated to the nearest one-hundredth) obtained by dividing (x)
the product of the aggregate number of shares of Common Stock covered by this
Warrant immediately prior to such adjustment and the Purchase Price in effect
immediately prior to such adjustment of the Purchase Price by (y) the Purchase
Price in effect immediately after such adjustment of the Purchase Price.
(i) Reorganization, Reclassification, Merger and Sale of Assets. If
there occurs any capital reorganization or any reclassification of the Common
Stock of the Company, the consolidation or merger of the Company with or into
another Person (other than a merger or consolidation of the Company in which the
Company is the continuing corporation and which does not result in any
reclassification or change of outstanding shares of its Common Stock) or the
sale or conveyance of all or substantially all of the assets of the Company to
another Person at any time after October 12, 2005, then the Holder will
thereafter be entitled to receive, upon the exercise of this Warrant in
accordance with the terms hereof, the same kind and amounts of securities
(including shares of stock) or other assets, or both, which were issuable or
distributable to the holders of outstanding Common Stock of the Company upon
such reorganization, reclassification, consolidation, merger, sale or
conveyance, in respect of that number of shares of Common Stock then deliverable
upon the exercise of this Warrant if this Warrant had been exercised immediately
prior to such reorganization, reclassification, consolidation, merger, sale or
conveyance; and, in any such case, appropriate adjustments (as determined in
good faith by the Board of Directors of the Company) shall be made to assure
that the provisions hereof (including, without limitation, provisions with
respect to changes in, and other adjustments of, the Purchase Price) shall
thereafter be applicable, as nearly as reasonably may be practicable, in
relation to any securities or other assets thereafter deliverable upon exercise
of this Warrant.
(j) Special Adjustment. If, as of November 16, 2005, the Company
purchased less than 1,500,000 Tendered Shares, as such term is defined in the
Purchase Agreement (the "MAXIMUM TENDERED SHARES"), then this Warrant shall
evidence the right to receive an additional number of shares of Common Stock
(subject to adjustment as provided herein ab initio) computed using the
following formula:
AS = MTS - MTS
---
A
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where:
AS equals the additional number of shares of Common Stock for
which this Warrant will be exercisable
MTS equals the number of Maximum Tendered Shares less the
aggregate number of Tendered Shares actually purchased by the
Company as of November 16, 2005
A equals 0.98716
4. Certificate as to Adjustments. Whenever the Purchase Price or the number
of shares of Common Stock issuable, or the securities or other property
deliverable, upon the exercise of this Warrant shall be adjusted pursuant to the
provisions hereof, the Company shall promptly give written notice thereof to the
Holder, in accordance with Section 13, in the form of a certificate signed by
the Chairman of the Board, President or one of the Vice Presidents of the
Company, and by the Chief Financial Officer, Treasurer or one of the Assistant
Treasurers of the Company, stating the adjusted Purchase Price, the number of
shares of Common Stock issuable, or the securities or other property
deliverable, upon exercise of the Warrant and setting forth in reasonable detail
the method of calculation and the facts requiring such adjustment and upon which
such calculation is based. Each adjustment shall remain in effect until a
subsequent adjustment is required.
5. Fractional Shares. Notwithstanding an adjustment pursuant to Section
3(h) in the number of shares of Common Stock covered by this Warrant or any
other provision of this Warrant, the Company shall not be required to issue
fractions of shares upon exercise of this Warrant or to distribute certificates
which evidence fractional shares. In lieu of fractional shares, the Company may
make payment to the Holder, at the time of exercise of this Warrant as herein
provided, of an amount in cash equal to such fraction multiplied by the greater
of the Current Market Price of a share of Common Stock on the Exercise Date and
the Purchase Price.
6. Notice of Proposed Actions. In case the Company shall propose at any
time or from time to time (a) to declare or pay any dividend payable in stock of
any class to the holders of Common Stock or to make any other distribution to
the holders of Common Stock (other than a regularly scheduled cash dividend),
(b) to offer to the holders of Common Stock rights or warrants to subscribe for
or to purchase any additional shares of Common Stock or shares of stock of any
class or any other securities, rights, warrants or options, (c) to effect any
reclassification of its Common Stock, (d) to effect any consolidation, merger or
sale, transfer or other disposition of all or substantially all of the property,
assets or business of the Company which would, if consummated, adjust the
Purchase Price or the securities issuable upon exercise of the Warrants, (e) to
effect the liquidation, dissolution or winding up of the Company, or (f) to take
any other action that would require a vote of the Company's stockholders, then,
in each such case, the Company shall give to the Holder, in accordance with
Section 13, a written notice of such proposed action, which shall specify (i)
the record date for the purposes of such stock dividend, distribution of rights
or warrants or vote of the stockholders of the Company, or if a record is not to
be taken, the date as of which the holders of shares of Common Stock of record
to be entitled to such dividend, distribution of rights or warrants, or vote is
to be determined, or (ii) the date on which such reclassification,
consolidation, merger, sale, transfer, disposition, liquidation, dissolution or
winding up is expected to become effective, and such notice shall be so given as
promptly as possible but in any event at least ten (10) Business Days prior to
the applicable record, determination or effective date specified in such notice.
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7. No Dilution or Impairment. The Company will not, by amendment of its
Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
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 of this Warrant against
dilution or other impairment. Without limiting the generality of the foregoing,
the Company (a) will not increase the par value of any shares of stock
receivable on the exercise of this Warrant above the amount payable therefor on
such exercise, (b) will at all times reserve and keep available the maximum
number of its authorized shares of Common Stock, free from all preemptive rights
therein, which will be sufficient to permit the full exercise of this Warrant,
and (c) will take all such action as may be necessary or appropriate in order
that all shares of Common Stock as may be issued pursuant to the exercise of
this Warrant will, upon issuance, be duly and validly issued, fully paid and
nonassessable, and free from all taxes, liens and charges with respect to the
issue thereof.
8. Replacement of Warrants. On receipt by the Company of an affidavit of an
authorized representative of the Holder stating the circumstances of the loss,
theft, destruction or mutilation of this Warrant (and in the case of any such
mutilation, on surrender and cancellation of such Warrant), the Company at its
expense will promptly execute and deliver, in lieu thereof, a new Warrant of
like tenor which shall be exercisable for a like number of shares of Common
Stock. If required by the Company, such Holder must provide an indemnity bond or
other indemnity sufficient in the judgment of the Company to protect the Company
from any loss which it may suffer if a lost, stolen or destroyed Warrant is
replaced.
9. Restrictions on Transfer.
(a) Subject to the provisions of this Section 9, this Warrant may be
transferred or assigned, in whole or in part, by the Holder at any time, and
from time to time. The term "Holder" as used herein shall also include any
transferee of this Warrant whose name has been recorded by the Company in the
Warrant Register (as hereinafter defined). Each transferee of the Warrant or the
Common Stock issuable upon the exercise of the Warrant acknowledges that the
Warrant or the Common Stock issuable upon the exercise of the Warrant has not
been registered under the Securities Act and may be transferred only pursuant to
an effective registration under the Securities Act or pursuant to an applicable
exemption from the registration requirements of the Securities Act.
12
(b) With respect to a transfer that should occur prior to the time
that the Warrant or the Common Stock issuable upon the exercise thereof is
registered under the Securities Act, such Holder shall request an opinion of
counsel (which shall be rendered by counsel reasonably acceptable to the
Company) that the proposed transfer may be effected without registration or
qualification under any Federal or state securities or blue sky law. Counsel
shall, as promptly as practicable, notify the Company and the Holder of such
opinion and of the terms and conditions, if any, to be observed in such
transfer, whereupon the Holder shall be entitled to transfer this Warrant or
such shares of Common Stock (or portion thereof), subject to any other
provisions and limitations of this Warrant. In the event this Warrant shall be
exercised as an incident to such transfer, such exercise shall relate back and
for all purposes of this Warrant be deemed to have occurred as of the date of
such notice regardless of delays incurred by reason of the provisions of this
Section 9 which may result in the actual exercise on any later date.
(c) The Company shall maintain a register (the "Warrant Register") in
its principal office for the purpose of registering the Warrant and any transfer
thereof, which register shall reflect and identify, at all times, the ownership
of any interest in the Warrant. Upon the issuance of this Warrant, the Company
shall record the name of the initial purchaser of this Warrant in the Warrant
Register as the first Holder. Upon surrender for registration of transfer or
exchange of this Warrant together with a properly executed Form of Assignment
attached hereto as Exhibit B at the principal office of the Company, the Company
shall, at its expense, execute and deliver one or more new Warrants of like
tenor which shall be exercisable for a like aggregate number of shares of Common
Stock, registered in the name of the Holder or a transferee or transferees.
10. No Rights or Liability as a Stockholder. This Warrant does not entitle
the Holder hereof to any voting rights or other rights as a stockholder of the
Company. No provisions hereof, in the absence of affirmative action by the
Holder hereof to purchase Common Stock, and no enumeration herein of the rights
or privileges of the Holder shall give rise to any liability of such Holder as a
stockholder of the Company.
11. Charges, Taxes and Expenses. Issuance of certificates for shares of
Common Stock upon the exercise of this Warrant shall be made without charge to
the Holder hereof for any issue or transfer tax, or other incidental expense, in
respect of the issuance or delivery of such certificates or the securities
represented thereby, all of which taxes and expenses shall be paid by the
Company.
12. Amendment or Waiver. This Warrant and any term hereof may be amended,
waived, discharged or terminated only by and with the written consent of the
Company and the Holder.
13
13. Notices. Any notice or other communication (or delivery) required or
permitted hereunder shall be made in writing and shall be by registered mail,
return receipt requested, telecopier, courier service or personal delivery to
the Company at its principal office as specified in Section 11.2 of the Purchase
Agreement and to the Holder at its address as it appears in the Warrant
Register. All such notices and communications (and deliveries) shall be deemed
to have been duly given: when delivered by hand, if personally delivered; when
delivered by courier, if delivered by commercial overnight courier service; five
Business Days after being deposited in the mail, postage prepaid, if mailed; and
when receipt is acknowledged, if telecopied.
14. Certain Remedies. The Holder shall be entitled to an injunction or
injunctions to prevent breaches of the provisions of this Warrant and to enforce
specifically the terms and provisions of this Warrant in any court of the United
States or any state thereof having jurisdiction, this being in addition to any
other remedy to which such Holder may be entitled at law or in equity.
15. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, CONSTRUED IN
ACCORDANCE WITH, AND ENFORCED UNDER, THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS OR INSTRUMENTS ENTERED INTO AND PERFORMED ENTIRELY
WITHIN SUCH STATE.
16. Headings. The headings in this Warrant are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.
[Remainder of Page Intentionally Left Blank]
14
XX XXXX'X CORPORATION
By:___________________________________
Name:
Title:
[SIGNATURE PAGE TO WARRANT]
Exhibit A to Common
Stock Purchase Warrant
--------------------------
[FORM OF]
ELECTION TO PURCHASE SHARES
The undersigned hereby irrevocably elects to exercise the Warrant to
purchase _____ shares of Common Stock, par value $.01 per share ("Common
Stock"), of XX Xxxx'x Corporation (the "Company") and hereby [makes payment of
$_______ therefor] [or] [makes payment therefor by assignment to the Company
pursuant to Section 2(b)(i)(B) of the Warrant of $_____________ aggregate
principal amount of Note (as defined in the Warrant)] [or] [makes payment
therefore by surrendering pursuant to Section 2(b)(i)(C) _____ shares of Common
Stock of the Company] [or] [makes payment therefor by cancellation pursuant to
Section 2(b)(ii) of a portion of the Warrant with respect to _________ shares of
Common Stock]. The undersigned hereby requests that certificates for such shares
be issued and delivered as follows:
ISSUE TO:_______________________________________________________________________
(NAME)
________________________________________________________________________________
(ADDRESS, INCLUDING ZIP CODE)
________________________________________________________________________________
(SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER)
DELIVER TO:_____________________________________________________________________
(NAME)
________________________________________________________________________________
(ADDRESS, INCLUDING ZIP CODE)
If the number of shares of Common Stock purchased hereby is less than the
number of shares of Common Stock covered by the Warrant, the undersigned
requests that a new Warrant representing the number of shares of Common Stock
not purchased be issued and delivered as follows:
ISSUE TO:_______________________________________________________________________
(NAME OF HOLDER)
________________________________________________________________________________
(ADDRESS, INCLUDING ZIP CODE)
DELIVER TO:_____________________________________________________________________
(NAME OF XXXXXX)
________________________________________________________________________________
(ADDRESS, INCLUDING ZIP CODE)
Dated:______________________________ [NAME OF HOLDER]
By: _________________________________
Name:
Title:
_________________________
1 Name of Holder must conform in all respects to name of Holder as specified
on the face of the Warrant.
Exhibit B to Common
Stock Purchase Warrant
--------------------------
[FORM OF] ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
unto the Assignee named below all of the rights of the undersigned to purchase
Common Stock, par value $.01 per share ("Common Stock"), of XX Xxxx'x
Corporation represented by the Warrant, with respect to the number of shares of
Common Stock set forth below:
Name of Assignee Address No. of Shares
and does hereby irrevocably constitute and appoint ____________________________
Attorney to make such transfer on the books of XX Xxxx'x Corporation maintained
for that purpose, with full power of substitution in the premises.
Dated: _____________________________ [NAME OF HOLDER1]
By: _________________________________
Name:
Title:
_________________________
1 Name of Xxxxxx must conform in all respects to name of Holder as specified
on the face of the Warrant.
