FIRST AMENDMENT TO SUPERIOR BANK
WARRANT REPURCHASE AGREEMENT
THIS FIRST AMENDMENT TO SUPERIOR BANK WARRANT REPURCHASE AGREEMENT
("First Amendment") is made as of August 11, 1999 and is between SUPERIOR BANK
FSB, a federally chartered savings bank, with its principal place of business at
Xxx Xxxxxxx Xxxxxx, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000 ("Superior") and
XXXXXXXX.XXX, INC. (formerly known as First Mortgage Network, Inc.), a Florida
corporation, with its principal place of business at 0000 Xxxxxxx Xxxxxxxxx,
Xxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx 00000 ("Xxxxxxxx.xxx").
RECITALS
A. Xxxxxxxx.xxx and Superior are parties to the Superior Bank Warrant
Repurchase Agreement made as of May 5, 1999 ("Agreement")
B. As of the date hereof, Xxxxxxxx.xxx has purchased and Superior has
sold warrants to purchase 200,000 shares of Xxxxxxxx.xxx common stock having an
exercise price of $5.00 per share for an aggregate consideration of $12,000,000
pursuant to Subsections 2(a) and 2(b) of the Agreement.
C. Xxxxxxxx.xxx and Superior now desire to amend the Repurchase
Agreement in order to facilitate Xxxxxxxx.xxx's initial public offering of
stock ("IPO").
NOW THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth, the parties agree as follows:
Section 1. Definitions. Capitalized terms used in this First
Amendment and not otherwise defined herein have the meanings ascribed to them in
the Agreement, unless the context otherwise requires.
Section 2. Option for the Purchase and Sale of Warrants. Section 2 of
the Agreement is hereby amended and restated in its entirety as follows:
Section 2. Purchase and Sale of Warrants. The purchase and sale of
the Warrants shall occur as follows:
(a) Stage 1. Upon the closing of the Bridge Note Financing,
Xxxxxxxx.xxx will purchase, and Superior will sell, a Warrant to
purchase 100,000 shares of Xxxxxxxx.xxx common stock having an exercise
price of $5.00 per share (the "First Stage Warrant"). The purchase
price for the First Stage Warrant shall be $6,000,000.
(b) Stage 2. Upon the closing of the Bridge Note Financing, then on or
before June 30, 1999, Xxxxxxxx.xxx will purchase, and Superior will
sell, a Warrant to purchase 100,000 shares of Xxxxxxxx.xxx common stock
having an exercise price
of $5.00 per share (the "Second Stage Warrant"). The purchase price for
the Second Stage Warrant shall be $6,000,000. Xxxxxxxx.xxx shall
deliver to Superior a written notice setting forth the closing date
(the "Second Stage Closing Date") for the purchase of the Second Stage
Warrant. The Second Stage Closing Date shall be not later than June 30,
1999 and the notice of closing date provided to Superior shall be
delivered to Superior not less than 5 business days prior to the Second
Stage Closing Date.
(c) Stage 3. Immediately following the closing of the IPO, Xxxxxxxx.xxx
shall purchase, and Superior shall sell, a Warrant to purchase 6,667
shares of Xxxxxxxx.xxx common stock having an exercise price of $5.00
per share and a Warrant to purchase 3,333 shares of Xxxxxxxx.xxx common
stock having an exercise price of $7.50 per share (collectively, the
"Third Stage Warrants"). The purchase price for the Third Stage
Warrants shall be $433,300.
(d) Stage 4. Xxxxxxxx.xxx shall have an option to purchase, and upon
exercise of the option Superior shall sell, Warrants to purchase
193,333 shares of Xxxxxxxx.xxx common stock having an exercise price of
$5.00 per share and Warrants to purchase 96,667 shares of Xxxxxxxx.xxx
common stock having an exercise price of $7.50 per share, or any lesser
portion thereof (collectively, the "Fourth Stage Warrants"). The
purchase price for the Fourth Stage Warrants shall be $43.33 per
warrant and if less than all of the Fourth Stage Warrants are purchased
during this stage, such Warrants shall be purchased in a ratio of 2
Warrants with a strike price of $5.00 for each Warrant with a strike of
$7.50. To exercise its option to purchase the Fourth Stage Warrants,
Xxxxxxxx.xxx shall deliver to Superior a written notice of exercise
which includes the closing date (the "Fourth Stage Closing Date") for
the purchase of the Fourth Stage Warrants. The Fourth Stage Closing
Date shall be not later than September 30, 1999, and the notice of
exercise shall be delivered to Superior not less than 5 business days
prior to the Fourth Stage Closing Date.
(e) Stage 5. After September 30, 1999 and until December 31, 2000,
Xxxxxxxx.xxx shall have an option to purchase during the periods set
forth below, and upon exercise of the option Superior will sell, any
remaining Fourth Stage Warrants at the purchase price designated below
for each such period:
October 1, 1999 through October 31, 1999 $49.83
November 1, 1999 through November 30, 1999 $56.33
December 1, 1999 through December 31, 1999 $62.83
January 1, 2000 through January 31, 2000 $65.00
February 1, 2000 through February 29, 2000 $67.16
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March 1, 2000 through March 31, 2000 $69.33
April 1, 2000 through April 30, 2000 $71.49
May 1, 2000 through May 31, 2000 $73.66
June 1, 2000 through June 30, 2000 $75.83
July 1, 2000 through July 31, 2000 $77.99
August 1, 2000 through August 31, 2000 $80.16
September 1, 2000 through September 30, 2000 $82.33
October 1, 2000 through October 31, 2000 $84.49
November 1, 2000 through November 30, 2000 $86.66
December 1, 2000 through December 31, 2000 $88.83
Section 3. No Requirement of Purchase Upon IPO or Business
Combination. Section 3 of the Repurchase Agreement is hereby deleted in its
entirety and shall be replaced with the following:
Section 3. INTENTIONALLY OMITTED.
Section 4. Payment of Purchase Price for Warrants; Closing Dates.
Section 4 of the Repurchase Agreement is hereby amended and restated in its
entirety as follows:
Section 4. Payment of Purchase Price for Warrants; Closing Dates. The
purchase price for the Warrants shall be paid by wire transfer of
immediately available funds to a bank account designated for that
purpose by Superior and Superior shall deliver to Xxxxxxxx.xxx the
executed original agreements evidencing the Warrants duly endorsed in
blank by Superior. Xxxxxxxx.xxx's payment of the purchase price, and
Superior's delivery of the agreements, shall occur if the purchase
occurs under Section 2: (i) as to the First Stage Warrants, not later
than 5 business days following the closing of the Bridge Note
Financing, (ii) as to the Second Stage Warrants, not later than the
Second Stage Closing Date, (iii) as to the Third Stage Warrants,
immediately following the closing of the IPO, and (iv) as to the Fourth
Stage Warrants, not later than December 31, 2000.
Section 5. Termination. Section 5 of the Repurchase Agreement is
hereby amended and restated in its entirety as follows:
Section 5. Termination. This Agreement shall terminate and be of no
further force and effect at the close of business on August 31, 1999 if
the IPO has not then occurred or, if the IPO has occurred on or before
August 31, 1999, at
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midnight on December 31, 2000, and neither party hereto shall
thereafter have any rights or obligations hereunder; provided, however,
that such termination shall not relieve any party of liability for
breach of the terms hereof.
Section 6. Assignments of Xxxxxxxx.xxx's Rights Prior to September
30, 1999. If at any time on or before September 30, 1999, Xxxxxxxx.xxx shall
sell, transfer or otherwise assign for value its rights under this Agreement to
a third party, Xxxxxxxx.xxx shall pay to Superior one half of any consideration
received by Xxxxxxxx.xxx for such sale, transfer or assignment.
Section 7. Anti-Dilution Adjustment. The number of Warrants and the
respective strike prices and purchase prices thereof set forth in this First
Amendment are prior to any stock split in anticipation of the IPO. In the event
of any stock split or stock combination on or after the date hereof, the
appropriate adjustments shall be made.
Section 8. Miscellaneous. This First Amendment may be executed by
each of the parties on separate counterparts which together shall constitute a
single binding Agreement with the same force and effect as if the signatures of
both parties appeared on the same counterpart signature page. The headings of
the sections of this First Amendment are for ease of reference and shall not be
deemed to be a part of this First Amendment. This First Amendment shall be
binding upon and shall inure to the benefit of the respective successors and
assigns of Xxxxxxxx.xxx and Superior.
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IN WITNESS WHEREOF, Superior and Xxxxxxxx.xxx have executed this First Amendment
to Superior Bank Warrant Repurchase Agreement as of the date first above
written.
XXXXXXXX.XXX, INC.
By:
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Xxxx Xxxxxx, Chairman and CEO
SUPERIOR BANK FSB
By:
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Xxxxxxx X. Xxxxxxx, Senior Vice President
and Chief Financial Officer
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