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EXHIBIT 10.39
THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT
HAVE BEEN ISSUED PURSUANT TO REGULATION D PROMULGATED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF
ANY STATE. THE SECURITIES REPRESENTED HEREBY MAY NOT BE OFFERED, SOLD
OR OTHERWISE TRANSFERRED UNLESS THE SECURITIES ARE REGISTERED UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS, OR SUCH
OFFERS, SALES AND TRANSFERS ARE MADE PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THOSE LAWS.
Date: July 17, 1997 WARRANT NO. SV-1
PACKAGED ICE, INC.
COMMON STOCK PURCHASE WARRANT
THIS CERTIFIES THAT, for value received, SV CAPITAL PARTNERS, L.P.
(the "Investor"), or its registered assigns, is entitled to purchase from
PACKAGED ICE, INC., a Texas corporation (the "COMPANY"), at any time or from
time to time during the period specified in Section 2 hereof, One Hundred
Thousand (100,000) fully paid and nonassessable shares of the Company's Common
Stock, $.01 par value (the "COMMON STOCK"), at an exercise price per share (the
"EXERCISE PRICE") of $14.00 per share. The number of shares of Common Stock
purchasable hereunder (the "WARRANT SHARES") and the Exercise Price are subject
to adjustment as provided in Section 4 hereof. The term "WARRANT" means this
Warrant of the Company issued pursuant to the Stock Purchase Agreement (as
hereinafter defined). The term "WARRANT PERIOD" as used herein means the
period commencing on the date this Warrant is issued and delivered pursuant to
the terms of that certain Stock Purchase Agreement, dated as of July 17, 1997,
by and between the Company and the Investor listed on the execution page
thereof (the "STOCK PURCHASE AGREEMENT") and ending at 5:00 p.m. New York City
time on the fifth (5th) anniversary of the date of issuance.
This Warrant is subject to the following terms, provisions, and
conditions:
1. MANNER OF EXERCISE; ISSUANCE OF CERTIFICATES; PAYMENT FOR
SHARES. Subject to the provisions hereof, including without limitation, the
vesting provisions contained in Section 2(a) and (b) hereof, and the
limitations contained in Section 7 hereof, this Warrant may be exercised by the
holder hereof, in whole at any time, or in part from time to time, prior to its
expiration date as set forth above, by the surrender of this Warrant, together
with a completed exercise agreement in the form attached hereto (the "EXERCISE
AGREEMENT"), to the Company during normal business hours on any business day at
the Company's principal executive offices (or such other office or agency of
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the Company as it may designate by notice to the holder hereof), and upon (i)
payment to the Company in cash, by certified or official bank check or by wire
transfer for the account of the Company, of the Exercise Price for the Warrant
Shares specified in the Exercise Agreement or (ii) delivery to the Company of a
written notice of an election to effect a Cashless Exercise (as defined in
Section 11(c) below) for the Warrant Shares specified in the Exercise
Agreement. The Warrant Shares so purchased shall be deemed to be issued to the
holder hereof or such holder's designee, as the record owner of such shares, as
of the close of business on the date on which this Warrant shall have been
surrendered, the completed Exercise Agreement shall have been delivered, and
payment shall have been made for such shares as set forth above. Certificates
for the Warrant Shares so purchased, representing the aggregate number of
shares specified in the Exercise Agreement, shall be delivered to the holder
hereof within a reasonable time, not exceeding five (5) business days, after
this Warrant shall have been so exercised. The certificates so delivered shall
be in such denominations as may be requested by the holder hereof and shall be
registered in the name of such holder or such other name as shall be designated
by such holder. If this Warrant shall have been exercised only in part, then,
unless this Warrant has expired, the Company shall, at its expense, at the time
of delivery of such certificates, deliver to the holder a new Warrant
representing the number of shares with respect to which this Warrant shall not
then have been exercised.
2. PERIOD OF EXERCISE. This Warrant may be exercised at any time
on or after the date hereof (the "EFFECTIVE DATE") and prior to the close of
business on the fifth anniversary of the Effective Date.
3. CERTAIN AGREEMENTS OF THE COMPANY. The Company hereby
covenants and agrees as follows:
(a) SHARES TO BE FULLY PAID. All Warrant Shares will,
upon issuance in accordance with the terms of this Warrant, be validly issued,
fully paid, and nonassessable and free from all taxes, liens, claims and
encumbrances.
(b) RESERVATION OF SHARES. During the Warrant Period,
the Company shall at all times have authorized, and reserved for the purpose of
issuance upon exercise of this Warrant, a sufficient number of shares of Common
Stock to provide for the exercise of this Warrant.
(c) LISTING. The Company shall promptly secure the
listing of the shares of Common Stock issuable upon exercise of the Warrant
upon each national securities exchange or automated quotation system, if any,
upon which shares of Common Stock are then listed or become listed (subject to
official notice of issuance upon exercise of this Warrant) and shall maintain,
so long as any other shares of Common Stock shall be so listed, such listing of
all shares of Common Stock from time to time issuable upon the exercise of this
Warrant; and the Company shall so list on each national securities exchange or
automated quotation system, as the case may be, and shall maintain such listing
of, any other shares of capital stock of the Company issuable upon the exercise
of this Warrant if and so long as any shares of the same class shall be listed
on such national securities exchange or automated quotation system.
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(d) CERTAIN ACTIONS PROHIBITED. The Company will not, by
amendment of its charter or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities, or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed by it hereunder, but will at all times in
good faith assist in the carrying out of all the provisions of this Warrant and
in the taking of all such action as may reasonably be requested by the holder of
this Warrant in order to protect the exercise privilege of the holder of this
Warrant against dilution or other impairment, consistent with the tenor and
purpose of this Warrant. Without limiting the generality of the foregoing, the
Company (i) will not increase the par value of any shares of Common Stock
receivable upon the exercise of this Warrant above the Exercise Price then in
effect, and (ii) will take all such actions as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and
nonassessable shares of Common Stock upon the exercise of this Warrant.
(e) SUCCESSORS AND ASSIGNS. This Warrant will be binding
upon any entity succeeding to the Company by merger, consolidation, or
acquisition of all or substantially all the Company's assets.
4. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES ISSUABLE.
The number and kind of Warrant Shares purchasable upon the exercise of Warrant
and the Exercise Price shall be subject to adjustment from time to time as
follows:
(a) STOCK SPLITS, COMBINATIONS, ETC. In case the
Company shall hereafter (i) pay a dividend or make a distribution on its Common
Stock in shares of its capital stock (whether shares of Common Stock or of
capital stock of any other class), (ii) subdivide its outstanding shares of
Common Stock or (iii) combine its outstanding shares of Common Stock into a
smaller number of shares, the number of Warrant Shares purchasable upon
exercise of this Warrant immediately prior thereto shall be adjusted so that
the holder of this Warrant thereafter exercised shall be entitled to receive
the number of Warrant Shares which such holder would have owned immediately
following such action had such Warrant been exercised immediately prior
thereto. An adjustment made pursuant to this paragraph shall become effective
immediately after the record date in the case of a dividend and shall become
effective immediately after the effective date in the case of a subdivision,
combination or reclassification. If, as a result of an adjustment made
pursuant to this paragraph, the holder of this Warrant thereafter exercised
shall become entitled to receive shares of two or more classes of capital stock
of the Company, the Board of Directors of the Company (whose determination
shall be conclusive) shall determine the allocation of the adjusted Exercise
Price between or among shares of such classes of capital stock.
(b) RECLASSIFICATION, COMBINATIONS, MERGERS, ETC. In
case of any reclassification or change of outstanding shares of Common Stock
(other than as set forth in Section 4(a) above and other than a change in par
value, or from par value to no par value, or from no par value to par value, or
in case of any consolidation or merger of the Company with or into another
corporation (other than a merger in which the Company is the continuing
corporation and which does not result in any reclassification or change of the
then outstanding shares of Common Stock or other capital stock of
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the Company (other than a change in par value, or from par value to no par
value, or from par value to par value or as a result of a subdivision or
combination)) or in case of any sale or conveyance to another corporation of
all or substantially all of the assets of the Company, then, as a condition of
such reclassification, change, consolidation, merger, sale or conveyance, the
Company or such a successor or purchasing corporation, as the case may be,
shall forthwith make lawful and adequate provision whereby the holder of such
Warrant then outstanding shall have the right thereafter to receive on exercise
of such Warrant the kind and amount of shares of stock and other securities and
property receivable upon such reclassification, change, consolidation, merger,
sale or conveyance by a holder of the number of shares of Common Stock issuable
upon exercise of such Warrant immediately prior to such reclassification,
change, consolidation, merger, sale or conveyance and enter into a supplemental
warrant agreement so providing. Such provisions shall include provision for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 4. If the issuer of securities
deliverable upon exercise of Warrants under the supplemental warrant agreement
is an affiliate of the formed, surviving or transferee corporation, that issuer
shall join in the supplemental warrant agreement. The above provisions of this
paragraph (b) shall similarly apply to successive reclassifications and changes
of shares of Common Stock and to successive consolidations, mergers, sales or
conveyances.
In case of any such reclassification, merger, consolidation or
disposition of assets, the successor or acquiring corporation (if other than
the Company) shall expressly assume the due and punctual observance and
performance of each and every covenant and condition of this Warrant to be
performed and observed by the Company and all the obligations and liabilities
hereunder, subject to such modifications as may be deemed appropriate (as
determined by resolution of the Board of Directors of the Company) in order to
provide for adjustments of shares of the Common Stock for which this Warrant is
exercisable which shall be as nearly equivalent as practicable to the
adjustments provided for in this Section 4. The foregoing provisions of this
Section 4(b) shall similarly apply to successive reorganizations,
reclassifications, mergers, consolidations or disposition of assets.
(c) ISSUANCE OF COMMON STOCK, OPTIONS OR CONVERTIBLE
SECURITIES. For the purposes of this Warrant, "ADDITIONAL SHARES OF COMMON
STOCK" shall mean all shares of Common Stock issued or deemed to be issued by
the Company after the Effective Date, other than Excluded Shares (as defined
below).
In the event the Company shall, at any time or from time to time after
the Effective Date, issue, sell, distribute or otherwise grant in any manner
(including by assumption) shares of Common Stock or any rights to subscribe for
or to purchase, or any warrants or options for the purchase of, Common Stock or
any stock or securities convertible into or exchangeable for Common Stock (any
such rights, warrants or options being herein called "OPTIONS" and any such
convertible or exchangeable stock or securities being herein called
"CONVERTIBLE SECURITIES") or any Convertible Securities (other than upon
exercise of any Option), whether or not such Options or the rights to convert
or exchange such Convertible Securities are immediately exercisable, then the
maximum number of shares of Common Stock (as set forth in the instrument
relating thereto without regard
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to any provision contained therein for a subsequent adjustment of such number)
issuable upon the exercise and/or conversion of such Options or Convertible
Securities, shall be deemed to be Additional Shares of Common Stock.
For purposes of this Warrant Agreement, the term "ISSUANCE DATE" shall
mean (i) with respect to Additional Shares of Common Stock deemed to have been
issued in connection with the issuance of an Option or Convertible Security,
the date such Option or Convertible Security is issued and (ii) in all other
cases, the actual date Additional Shares of Common Stock are issued.
For the purposes of this Warrant Agreement, "EXCLUDED SHARES" shall
mean: (i) shares for which the consideration per share as determined pursuant
to paragraph (d) below would be equal to or more than the Current Market Value
determined on the day prior to the Issuance Date; (ii) shares of Common Stock
issuable upon the exercise of Options or conversion of Convertible Securities
existing as of the Effective Date; and (iii) shares of Common Stock
(appropriately adjusted to reflect stock splits, stock dividends,
reorganizations, consolidations and similar changes) issued pursuant to any
stock options granted or obtained after the Effective Date pursuant to the
Company's Stock Option Plan adopted July 26, 1994, as may be amended from time
to time by the Company's Board of Directors. The issuance of Excluded Shares
shall not be an issuance of Additional Shares of Common Stock, and shall not
give rise to a right to purchase the securities pursuant to paragraph (d)
below.
In any such case in which the Additional Shares of Common Stock are
deemed to be issued, no right to purchase securities under Section 4(d) below
will accrue upon the subsequent issue of shares of Common Stock upon the
exercise and/or conversion or exchange of such Option or Convertible Security
unless such Option or Convertible Security shall have been amended or modified
prior to exercise or conversion or exchange so as to increase the number of
Additional Shares of Common Stock deemed to have been issued thereunder or
decrease the exercise and/or conversion or exchange price payable thereunder to
an amount less than Current Market Value as of the Issuance Date thereof.
(d) If the price per share at which Common Stock is
issued or Common Stock is issuable upon the exercise of such Options or upon
the conversion or exchange of such Convertible Securities (determined by
dividing (i) the aggregate amount, if any, received or receivable by the
Company as consideration for the issuance, sale, distribution or granting of
such Common Stock or Options or any such Convertible Security, plus the minimum
aggregate amount of additional consideration, if any, payable to the Company
upon the issuance of Common Stock or the exercise of all such Options or upon
conversion or exchange of all such Convertible Securities, plus, in the case of
Options to acquire Convertible Securities, the minimum aggregate amount of
additional consideration, if any, payable upon the conversion or exchange of
all such Convertible Securities, by (ii) the total maximum number of shares of
Common Stock to be issued or issuable upon the exercise of all such Options or
upon the conversion or exchange of all such Convertible Securities or upon the
conversion or exchange of all Convertible Securities issuable upon the exercise
of all Options) shall be less than the Current Market Value per share of Common
Stock (determined
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pursuant to Section 4(e)) on the record date for the issuance, sale,
distribution or granting of such Options (any such event being herein called a
"DISTRIBUTION") then, the Company shall offer to sell to each holder of
Warrants, at the same price and on the same terms offered to all other
prospective buyers (provided that the holders of Warrants shall not be required
to buy any other securities in order to buy such Common Stock or Convertible
Securities), a portion of such Common Stock or Convertible Securities that is
equal to such holder's portion of the Common Stock then outstanding if
immediately prior thereto all the Warrants had been exercised. Each such
holder may elect to buy all or any portion of the Common Stock or Convertible
Securities offered or may decline to purchase any such securities.
(e) CURRENT MARKET VALUE. As used herein, the term
"CURRENT MARKET VALUE" per share of Common Stock or any other security at any
date means, on any date of determination (a) the average of the daily closing
sale prices for each of 15 business days immediately preceding such date (or
such shorter number of days during which such security has been listed or
traded), if the security has been listed on the New York Stock Exchange, the
American Stock Exchange or other national securities exchanges or the NASDAQ
National Market for at least 10 business days prior to such date, (b) if such
security is not so listed or traded, the average of the daily closing bid
prices for each of the 15 business days immediately preceding such date (or
such shorter number of days during which such security had been quoted), if the
security has been quoted on a national over-the-counter market for at least 10
business days, and (c) otherwise, the value of the security most recently
determined as of a date within the six months preceding such day by the
Company's Board of Directors.
(f) CONSIDERATION RECEIVED. If any shares of Common
Stock, Options or Convertible Securities shall be issued, sold or distributed
for a consideration other than cash, the amount of the consideration other than
cash received by the Company in respect thereof shall be deemed to be the then
fair market value of such consideration (as determined in good faith by the
Board of Directors of the Company). If any Options shall be issued in
connection with the issuance and sale of other securities of the Company,
together comprising one integral transaction in which no specific consideration
is allocated to such Options by the parties thereto, such Options shall be
deemed to have been issued without consideration; provided, however, that if
such Options have an exercise price equal to or greater than the Current Market
Value of the Common Stock on the date of issuance of such Options, then such
Options shall be deemed to have been issued for consideration equal to such
exercise price.
(g) CHANGES IN OPTIONS AND CONVERTIBLE SECURITIES. If
the exercise price provided for in any Options referred to in Section 4(f)
above, the additional consideration, if any, payable upon the conversion or
exchange of any Convertible Securities referred to in Section 4(d) above, or
the rate at which any Convertible Securities referred to in Section 4(d) above
are convertible into or exchangeable for Common Stock shall change at any time
to a price which is less than the Current Market Value thereof as of the
Issuance Date, then the Company shall make the offer to holders of the Warrants
as required by Section 4(d) above.
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(h) OTHER ACTION AFFECTING COMMON STOCK. In case at any
time or from time to time the Company shall take any action in respect of its
Common Stock, other than any action described in this Section 4, then the
number of Shares for which this Warrant is exercisable shall be adjusted in
such manner as may be equitable in the circumstances. If the Company shall at
any time and from time to time issue or sell (i) any shares of any class of
common stock other than Common Stock, (ii) any evidences of its indebtedness,
shares of stock or other securities which are convertible into or exchangeable
for such shares of common stock, with or without the payment of additional
consideration in cash or property or (iii) any warrants or other rights to
subscribe for or purchase any such shares of common stock or any such
evidences, shares of stock or other securities, then in each such case such
issuance shall be deemed to be of, or in respect of, Common Stock for purposes
of this Section 4; provided, however, that, without limiting the generality of
the foregoing, if the Company shall take a record of the holders of its Common
Stock for the purpose of entitling them to receive a dividend payable in, or
other distribution of, common stock other than Common Stock, including shares
of non-voting common stock, then the number of Warrant Shares for which this
Warrant is exercisable immediately after the occurrence of any such event shall
be adjusted to equal the aggregate number of shares of such common stock and of
Common Stock which a record holder of the same number of Warrant Shares for
which this Warrant is exercisable immediately prior to the occurrence of such
event would own or be entitled to receive after the happening of such event.
(i) FRACTIONAL INTEREST. The Company shall not be
required to issue fractional shares of Common Stock on the exercise of this
Warrant. If any fraction of a share of Common Stock would, except for the
provisions of this Section, be issuable on the exercise of any Warrant (or
specified portion thereof), the Company shall direct the transfer agent for the
Common Stock to pay an amount in cash calculated by the Company to equal the
then Current Market Value per share (determined pursuant to Section 4(e))
multiplied by such fraction computed to the nearest whole cent. The Investor
hereby expressly waives any and all rights to receive any fraction of a share
of Common Stock or a stock certificate representing a fraction of a share of
Common Stock.
(j) WHEN ADJUSTMENT NOT REQUIRED. If the Company shall
take a record of the holders of its Common Stock for the purpose of entitling
them to receive a dividend or distribution or subscription or purchase rights
and shall, thereafter and before the distribution to stockholders thereof,
legally abandon its plan to pay or deliver such dividend, distribution,
subscription or purchase rights, then thereafter no adjustment shall be
required by reason of the taking of such record and any such adjustment
previously made in respect thereof shall be rescinded and annulled.
(k) CHALLENGE TO GOOD FAITH DETERMINATION. Whenever the
Board of Directors of the Company shall be required to make a determination in
good faith of the fair value of any item under this Section 4, such
determination may be challenged in good faith by the holder hereof, and any
dispute shall be resolved by an investment banking firm of national standing
selected by the Company. The fee of such investment banking firm shall be paid
by the Company, unless such fair market value as determined by the investment
banking firm is more than 95% of the fair market value determined by the Board
of Directors of the Company, in which case the challenging holders shall be
jointly and severally liable for such fee.
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(l) TREASURY STOCK. The sale or other disposition of any
issued shares of Common Stock owned or held by or for the account of the
Company shall be deemed an issuance thereof and a repurchase thereof and
designation of such shares as treasury stock shall be deemed to be a redemption
thereof for the purposes of this Agreement.
(m) NOTICES TO WARRANT HOLDERS. Upon the occurrence of
any event which requires any adjustment of the Exercise Price, then, and in
each such case, the Company shall give notice thereof to the holder of this
Warrant, which notice shall state the Exercise Price resulting from such
adjustment and the increase or decrease in the number of Warrant Shares
purchasable at such price upon exercise, setting forth in reasonable detail the
method of calculation and the facts upon which such calculation is based. Such
calculation shall be certified by the chief financial officer of the Company.
5. ISSUE TAX. The issuance of certificates for Warrant Shares
upon the exercise of this Warrant shall be made without charge to the holder of
this Warrant or such shares for any issuance tax or other costs in respect
thereof, provided that the Company shall not be required to pay any tax which
may be payable in respect of any transfer involved in the issuance and delivery
of any certificate in a name other than the holder of this Warrant.
6. NO RIGHTS OR LIABILITIES AS A SHAREHOLDER. This Warrant shall
not entitle the holder hereof to any voting rights or other rights as a
shareholder of the Company. No provision of this Warrant, in the absence of
affirmative action by the holder hereof to purchase Warrant Shares, and no mere
enumeration herein of the rights or privileges of the holder hereof, shall give
rise to any liability of such holder for the Exercise Price or as a shareholder
of the Company, whether such liability is asserted by the Company or by
creditors of the Company.
7. TRANSFER, EXCHANGE, AND REPLACEMENT OF WARRANT.
(a) RESTRICTION ON TRANSFER. This Warrant and the rights
granted to the holder hereof are transferable, in whole or in part, upon
surrender of this Warrant, together with a properly executed assignment in the
form attached hereto, at the office or agency of the Company referred to in
Section 7(e) below, provided, however, that any transfer or assignment shall be
subject to the conditions set forth in Section 7(f) hereof and to the
applicable provisions of the Amended and Restated Shareholders Agreement (as
defined in the Stock Purchase Agreement). Until due presentment for
registration of transfer on the books of the Company, the Company may treat the
registered holder hereof as the owner and holder hereof for all purposes, and
the Company shall not be affected by any notice to the contrary.
Notwithstanding anything to the contrary contained herein, the registration
rights described in Section 8 are assignable only in accordance with the
provisions of that certain Registration Rights Agreement, dated as of July 17,
1997, by and among the Company and the other signatories thereto (the
"REGISTRATION RIGHTS AGREEMENT").
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(b) WARRANT EXCHANGEABLE FOR DIFFERENT DENOMINATIONS.
This Warrant is exchangeable, upon the surrender hereof by the holder hereof at
the office or agency of the Company referred to in Section 7(e) below, for new
Warrants of like tenor of different denominations representing in the aggregate
the right to purchase the number of shares of Common Stock which may be
purchased hereunder, each of such new Warrants to represent the right to
purchase such number of shares as shall be designated by the holder hereof at
the time of such surrender.
(c) REPLACEMENT OF WARRANT. Upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction, or
mutilation of this Warrant and, in the case of any such loss, theft, or
destruction, upon delivery of an indemnity agreement reasonably satisfactory in
form and amount to the Company, or, in the case of any such mutilation, upon
surrender and cancellation of this Warrant, the Company, at its expense, will
execute and deliver, in lieu thereof, a new Warrant of like tenor.
(d) CANCELLATION; PAYMENT OF EXPENSES. Upon the
surrender of this Warrant in connection with any transfer, exchange, or
replacement as provided in this Section 7, this Warrant shall be promptly
canceled by the Company. The Company shall pay all taxes (other than
securities transfer taxes) and all other expenses (other than legal expenses,
if any, incurred by the Holder or transferees) and charges payable in
connection with the preparation, execution, and delivery of Warrants pursuant
to this Section 7.
(e) WARRANT REGISTER. The Company shall maintain, at its
principal executive offices (or such other office or agency of the Company as
it may designate by notice to the holder hereof), a register for this Warrant,
in which the Company shall record the name and address of the person in whose
name this Warrant has been issued, as well as the name and address of each
transferee and each prior owner of this Warrant.
(f) EXERCISE OR TRANSFER WITHOUT REGISTRATION. If, at
the time of the surrender of this Warrant in connection with any exercise,
transfer, or exchange of this Warrant, this Warrant (or, in the case of any
exercise, the Warrant Shares issuable hereunder), shall not be registered under
the Securities Act and under applicable state securities or blue sky laws, the
Company may require, as a condition of allowing such exercise, transfer, or
exchange, (i) that the holder or transferee of this Warrant, as the case may
be, furnish to the Company a written opinion of counsel (which opinion and
counsel shall be reasonably acceptable to the Company, and, in the case of a
transfer to an affiliate of such holder, the cost of which shall be borne by
the Company) to the effect that such exercise, transfer, or exchange may be
made without registration under the Securities Act and under applicable state
securities or blue sky laws, (ii) that the holder or transferee execute and
deliver to the Company an investment letter in form and substance acceptable to
the Company and (iii) that the transferee be an "ACCREDITED INVESTOR" as
defined in Rule 501(a) promulgated under the Securities Act; provided that no
such opinion, letter, status as an "accredited investor" or minimum Market
Price shall be required in connection with a transfer pursuant to Rule 144
under the Securities Act.
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8. REGISTRATION RIGHTS. The initial holder of this Warrant (and
certain assignees thereof) is entitled to the benefit of such registration
rights in respect of the Warrant Shares as are set forth in the Registration
Rights Agreement.
9. NOTICES. Any notices required or permitted to be given under
the terms of this Warrant shall be sent by certified or registered mail (return
receipt requested) or delivered personally or by courier or by confirmed
telecopy, and shall be effective five days after being placed in the mail, if
mailed, or upon receipt or refusal of receipt, if delivered personally or by
courier or confirmed telecopy, in each case addressed to a party. The
addresses for such communications shall be:
If to the Company: Packaged Ice, Inc.
Attention: Chief Executive Officer
0000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
with copy to: Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
0000 XxxxxxxXxxx Xxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxx Xxxxxxxxxx, P.C.
and if to the holder, at such address as such holder shall have provided in
writing to the Company, or at such other address as each such party furnishes
by notice given in accordance with this Section 9.
10. GOVERNING LAW. THIS WARRANT SHALL BE GOVERNED BY AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO THE BODY OF LAW CONTROLLING CONFLICTS OF LAW. THE
UNITED STATES FEDERAL COURTS LOCATED IN NEW YORK CITY SHALL HAVE EXCLUSIVE
JURISDICTION WITH RESPECT TO ANY DISPUTE ARISING UNDER THIS WARRANT.
11. MISCELLANEOUS.
(a) AMENDMENTS. This Warrant and any provision hereof
may only be amended by an instrument in writing signed by the Company and the
holder hereof.
(b) DESCRIPTIVE HEADINGS. The descriptive headings of
the several Sections of this Warrant are inserted for purposes of reference
only, and shall not affect the meaning or construction of any of the provisions
hereof.
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(c) CASHLESS EXERCISE. Notwithstanding anything to the
contrary contained in this Warrant, this Warrant may be exercised at any time
by presentation and surrender of this Warrant to the Company at its principal
executive offices with a written notice of the holder's intention to effect a
cashless exercise, including a calculation of the number of shares of Common
Stock to be issued upon such exercise in accordance with the terms hereof (a
"CASHLESS EXERCISE"). In the event of a Cashless Exercise, in lieu of paying
the Exercise Price in cash, the holder shall surrender this Warrant in exchange
for that number of shares of Common Stock determined by multiplying the number
of Warrant Shares to which it would otherwise be entitled by a fraction, the
numerator of which shall be the difference between the then Current Market
Value per share of the Common Stock and the Exercise Price, and the denominator
of which shall be the then Current Market Value per share of Common Stock.
SIGNATURE PAGE FOLLOWS
-11-
12
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
by its duly authorized officer.
PACKAGED ICE, INC.
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
13
FORM OF EXERCISE AGREEMENT
(TO BE EXECUTED BY THE HOLDER IN ORDER TO EXERCISE THE WARRANT)
The undersigned hereby irrevocably exercises the right to purchase
_____________ of the shares of Common Stock of Packaged Ice, Inc., a Texas
corporation (the "COMPANY"), evidenced by the attached Warrant, and herewith
makes payment of the Exercise Price with respect to such shares in full, all in
accordance with the conditions and provisions of said Warrant.
i. The undersigned agrees not to offer, sell, transfer or
otherwise dispose of any Common Stock obtained on exercise of the Warrant,
except under circumstances that will not result in a violation of the
Securities Act of 1933, as amended, or any state securities laws, and agrees
that the following legend may be affixed to the stock certificate for the
Common Stock hereby subscribed for if resale of such Common Stock is not
registered or if Rule 144(k) is unavailable:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE
SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER SAID ACT, OR
AN OPINION OF COUNSEL, IN FORM, SUBSTANCE AND SCOPE REASONABLY
ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR UNLESS SOLD PURSUANT TO RULE 144(K) UNDER
SAID ACT.
ii. The undersigned requests that stock certificates for such
shares be issued, and a Warrant representing any unexercised portion hereof be
issued, pursuant to the Warrant in the name of the Holder and delivered to the
undersigned at the address set forth below:
Dated:
---------------- ------------------------------------
Signature of Holder
------------------------------------
Name of Holder (Print)
Address:
------------------------------------
------------------------------------
------------------------------------
14
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and
transfers all the rights of the undersigned under the within Warrant, with
respect to the number of shares of Common Stock covered thereby set forth
hereinbelow, to:
Name of Assignee Address No of Shares
---------------- ------- ------------
, and hereby irrevocably constitutes and appoints _____________________________
as agent and attorney-in-fact to transfer said Warrant on the books of the
within-named corporation, with full power of substitution in the premises.
Dated:
-----------------------,----------,
In the presence of
------------------------------
Name:
--------------------------------------
Signature:
---------------------------------
Title of Signing Officer or Agent (if any):
-------------------------------------------
Address:
---------------------------------
---------------------------------
Note: The above signature should
correspond exactly with the name
on the face of the within Warrant.
