Exhibit 10.8
WARRANT
This Warrant ("Warrant") is issued this 2nd day of May 2000, by CHAMPION TRAILER
COMPANY, L.P., an Indiana limited partnership (the "Company"), to MARKPOINT
EQUITY GROWTH FUND, J.V (MARKPOINT EQUITY GROWTH FUND, J.V. and any subsequent
assignee or transferee hereof are hereinafter referred to collectively as
"Holder").
AGREEMENT:
1. Issuance of Warrant. For and in consideration of $500.00 paid by Markpoint
Equity Growth Fund, J.V. to the Company and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company hereby grants to Holder the right to purchase 200
units of the Company's equity interests (the "Units"), which the Company
represents equals 25% of the issued and outstanding equity interests of the
Company on the date hereof, calculated on a fully diluted basis after full
exercise of this Warrant (the "Base Amount").
The units of Units issuable on exercise of this Warrant are hereafter
referred to as the "Shares". This Warrant shall be exercisable at any time
and from time to time for eight (8) years from the date issued. For
purposes of this Warrant, the term "fully diluted basis" shall be
determined in accordance with generally accepted accounting principles as
of the date hereof. As used herein, the term "Note" shall mean the Note in
the stated principal amount of $1,250,000 described in that certain Note
Purchase Agreement of even date herewith between the Company and Markpoint
Equity Growth Fund, J.V. (the "Note Purchase Agreement").
2. Exercise Price. The per share exercise price (the "Exercise Price") for
which all or any of the Shares may be purchased pursuant to the terms of
this Warrant shall be $.01.
3. Exercise. This Warrant may be exercised by the Holder hereof (but only on
the conditions hereinafter set forth) as to all or a portion of such
Shares, upon delivery of written notice of intent to exercise to the
Company at the following address: 000 Xxxxxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxxxxxxx, Xxxxxxx 00000, or such other address as the Company shall
designate by written notice to the Holder hereof, together with this
Warrant and payment to the Company of the aggregate Exercise Price of the
Shares so purchased. The Exercise Price shall be payable, at the option of
the Holder, (i) by certified or cashier's check, (ii) by the surrender of
the Note or portion thereof having an outstanding principal balance equal
to the aggregate Exercise Price or (iii) by the surrender of a portion of
this Warrant having a fair market value equal to the aggregate Exercise
Price. Upon exercise of this Warrant as aforesaid, the Company shall as
promptly as practicable, and in any event within fifteen (15) days
thereafter, execute and deliver to the Holder of this Warrant a certificate
or certificates for the total number of whole Shares for which this Warrant
is being exercised in such names and denominations as are requested by such
Holder. If this Warrant shall be exercised with respect to less than all of
the Shares, the Holder shall be entitled to receive a new Warrant covering
the number of Shares in respect of which new Warrant shall not have been
exercised, which new Warrant shall in all other respects be identical to
this Warrant. The Company covenants and agrees that it will pay when due
any and all state and federal issue taxes which may be payable in respect
of the issuance of this Warrant or the issuance of any Shares upon exercise
of this Warrant.
4. Representations, Covenants and Conditions. The above provisions are subject
to the following:
(a) Neither this Warrant nor the Shares have been registered under the
Securities Act of 1933, as amended ("Securities Act") or any state
securities laws ("Blue Sky Laws"). This Warrant has been acquired for
investment purposes and not with a view to distribution or resale and
may not be pledged, hypothecated sold, made subject to a security
interest, or otherwise transferred without (i) an effective
registration statement for such Warrant under the Securities Act and
such applicable Blue Sky Laws, or (ii) an opinion of counsel which
opinion and counsel shall be reasonably satisfactory to the Company
and its counsel that registration is not required under the Securities
Act or under any applicable Blue Sky Laws (the Company hereby
acknowledges that Xxxxxx Xxxxx LLP is acceptable counsel). Transfer of
the Shares issued upon the exercise of this Warrant shall be
restricted in the same manner and to the same extent as this Warrant
and the certificates representing such Shares shall bear substantially
the following legend:
THE SHARES OF UNITS REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), OR
ANY APPLICABLE STATE SECURITIES LAW AND MAY NOT BE TRANSFERRED UNTIL
(i) A REGISTRATION STATEMENT UNDER THE ACT OR SUCH APPLICABLE STATE
SECURITIES LAWS SHALL HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR
(II) IN THE OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY. REGISTRATION
UNDER SUCH SECURITIES ACTS OR SUCH APPLICABLE STATE SECURITIES LAWS IS
NOT REQUIRED IN CONNECTION WITH SUCH PROPOSED TRANSFER.
The Holder hereof and the Company agree to execute such other
documents and instruments as counsel for the Company reasonably deems
necessary to effect the compliance of the issuance of this Warrant and
any shares of Units issued upon exercise hereof with applicable
federal and state securities laws.
(b) The Company covenants and agrees that all Shares which may be issued
upon exercise of this Warrant will, upon issuance and payment
therefor, be legally and validly issued and outstanding, fully paid
and nonassessable, free from all taxes, liens, charges and preemptive
rights, if any, with respect thereto or to the issuance thereof The
Company shall at all times reserve and keep available for issuance
upon the exercise of this Warrant such number of authorized but
unissued shares of Units as will be sufficient to permit the exercise
in full of this Warrant.
(c) The Company represents and warrants to Holder the following:
(i) As of the date hereof, 600 units are issued and outstanding and
200 units of which shall be issued upon exercise of this Warrant;
and the Company shall not issue additional units to any person
other than the Holder while Holder holds this warrant or the
Shares except for those Shares issued to Holder pursuant to
Section 8 hereof; provided, however, that the number of units
reserved for issuance upon exercise of this Warrant may be
increased from time to time in accordance with the terms of this
Warrant;
(ii) As of the date hereof, the Company shall not have outstanding any
equity interests convertible or exchangeable for any shares of
its Units or containing any profit participation features, nor
shall it have outstanding any rights or options to subscribe for
or to purchase its Units or any stock or securities convertible
into or exchangeable for its Units or any stock appreciation
rights or phantom stock plans, except as set forth on Schedule A
and for this Warrant.
(iii)Schedule A accurately sets forth the following with respect to
all outstanding options and rights to acquire Units from Company:
(i) the total number of shares issuable upon exercise of all
outstanding options, (ii) the range of exercise prices for all
such outstanding options, (iii) the number of units issuable, the
exercise price, and the expiration date for each such outstanding
option and (iv) with respect to all outstanding options, warrants
and rights to acquire the Company's equity interests other than
this Warrant, the holder, the number of units covered, the
exercise price and the expiration date;
(iv) As of the date hereof, the Company shall not be subject to any
obligation (contingent or otherwise) to repurchase, redeem,
retire or otherwise acquire any shares of its equity interests or
any warrants, options or other rights to acquire its equity
interests, except as set forth in this Warrant or on Schedule A
attached hereto;
(v) As of the date hereof, all of the outstanding shares or the
Company's equity interests shall be validly issued, fully paid
and nonassessable. Except as set forth on Schedule A attached
hereto, there are not statutory or contractual preemptive rights,
rights of first refusal, anti-dilution rights or any similar
rights, held by unitholders or option holders of the Company,
with respect to the issuance of this Warrant or the issuance of
the Units upon exercise of this Warrant: and
(vi) Except as set forth on Schedule A attached hereto, all such
rights granted in the documents listed on Schedule A attached
hereto have been effectively waived with regard to the issuance
of this Warrant, the exercise of this Warrant and the issuance of
the Units upon securities laws in connection with the offer, sale
or issuance of any of its equity interests, and to the knowledge
of the Company, the offer, sale and issuance of this Warrant
hereunder do not require registration under the Securities Act or
any applicable state securities laws. To the best of the
Company's knowledge, there are no agreements among the Company's
stockholders with respect to any other aspect of Company's
affairs, except as set forth on Schedule A attached hereto.
(d) The Company covenants and agrees that it shall not sell any shares of
the Company's equity interests at a price below the Fair Market Value
(as determined by agreement between the Company and the Holder(s) or
pursuant to Section 9 hereof) of such shares, without the prior
written consent of the Holder hereof. In the event that the Company
sells shares of the Company's equity interests in violation of this
Subsection, the number of shares issuable upon exercise of this
Warrant shall be equal to the product obtained by multiplying the
number of shares issuable pursuant to this Warrant prior to such sale
by the quotient obtained by dividing (i) the fair market value of the
shares issued in violation of this Subsection by (ii) the price at
which such shares were sold.
5. Transfer of Warrant. Subject to the provisions of Section 4 hereof, this
Warrant may be transferred, in whole or in part, to any person or entity by
presentation of this Warrant to the Company with written instructions for
such transfer. Upon such presentation for transfer, the Company shall
promptly execute and deliver a new Warrant or Warrants in the form hereof
in the name of the assignee or assignees and in the denominations specified
in such instructions. The Company shall pay all expenses incurred by it in
connection with the preparation, issuance and delivery of Warrants under
this Section.
6. Warrant Holder Not Shareholder; Rights Offering; Preemptive Rights;
Preference Rights. Except as otherwise provided herein, this Warrant does
not confer upon the Holder, as such, any right whatsoever as a shareholder
of the Company. Notwithstanding the foregoing, if the Company should offer
to all of the Company's shareholders the right to purchase any securities
of the Company, then all shares of Units that are subject to this Warrant
shall be deemed to be outstanding and owned by the Holder and the Holder
shall be entitled to participate in such rights offering. The Company shall
not grant any preemptive rights with respect to any of its capital stock
without the prior written consent of the Holder. The Company shall not
issue any securities which entitle the holder thereof to obtain any
preference over holders of Units upon the dissolution, liquidation,
winding-up, sale, merger, or reorganization of the Company without the
prior written consent of the Holder.
7. Board Observation and Membership. The board of members of the General
Partner shall consist of no less than four (4) and no more than five (5).
Holder shall be entitled to designate at least one member of the board of
members of the General Partner, the Borrower and of each subsidiary thereof
but shall not be obligated to do so. So long as: (a) Holder holds this
Warrant or the Shares, or (b) the Loan (as defined in the Note Purchase
Agreement) has not been indefeasibly paid in full, Company will deliver to
Holder a copy of the minutes of and all materials distributed at or prior
to all meetings of the board of members of the General Partner, certified
as true and accurate by the Secretary of the General Partner, promptly
following each such meeting. The General Partner will (w) permit Holder, to
designate one person to attend all meetings of the General Partner's board
of members, (x) provide such designee not less than seven calendar days'
actual notice of all regular or special meetings of the General Partner's
board of members, (y) permit such designee to attend such meetings as an
observer, and (z) provide to such designee a copy of all materials
distributed at such meetings or otherwise to the members of the General
Partner. Such meetings shall be held in person or by telephone or video
conference at least quarterly, and the General Partner will cause its board
of members to call a meeting at any time upon the request of any such
designated observer upon the occurrence and continuation of any Event of
Default for 14 calendar days. The General Partner shall reimburse each such
observer for all reasonable expenses incurred in traveling to and from such
meetings and attending such meetings.
8. Adjustment Upon Changes in Units.
(a) If all or any portion of this Warrant shall be exercised subsequent to
any unit split unit dividend, recapitalization, combination of shares
of the Company, or other similar event, occurring after the date
hereof, then the Holder exercising this Warrant shall receive, for the
aggregate price paid upon such exercise, the aggregate number and
class of shares which such Holder would have received if this Warrant
had been exercised immediately prior to such unit split, unit
dividend, recapitalization, combination of shares, or other similar
event. If any adjustment under this Subsection would create a
fractional share of Units or a right to acquire a fractional share of
Units, such fractional share shall be disregarded and the number of
shares subject to this Warrant shall be the next higher number of
shares, rounding all fractions upward. Whenever there shall be an
adjustment pursuant to this Subsection, the Company shall forthwith
notify the Holder or Holders of this Warrant of such adjustment,
setting forth in reasonable detail the event requiring the adjustment
and the method by which such adjustment was calculated.
(b) If all or any portion of this Warrant shall be exercised subsequent to
any merger, consolidation, exchange of shares or other similar
ownership units, separation, reorganization or liquidation of the
Company, or other similar event, occurring after the date hereof, as a
result of which shares of Units shall be changed into the same or a
different number of shares of the same or another class or classes of
securities of the Company or another entity, then the Holder
exercising this Warrant shall receive, for the aggregate price paid
upon such exercise, the aggregate number and class of shares which
such Holder would have received if this Warrant had been exercised
immediately prior to such merger, consolidation, exchange of shares,
separation, reorganization or liquidation, or other similar event. If
any adjustment under this Subsection would create a fractional share
of Units or a right to acquire a fractional share of Units, such
fractional share shall be disregarded and the number of shares subject
to this Warrant shall be the next higher number of shares, rounding
all fractions upward. Whenever there shall be an adjustment pursuant
to this Subsection, the Company shall forthwith notify the Holder or
Holders of this Warrant of such adjustment, setting forth in
reasonable detail the event requiring the adjustment and the method by
which such adjustment was calculated.
9. Put Agreement.
(a) Subject to Subsection 9(b) hereof, so long as a Qualified IPO (as
defined below) has not been consummated, the Company hereby
irrevocably grants and issues to Holder the right and option to sell
to the Company (the "Put") this Warrant at a purchase price (the
"Purchase Price") equal to the Fair Market Value (as hereinafter
defined) of the shares of Units issuable to Holder upon exercise of
this Warrant; provided, however the Purchase Price will be increased
by an amount in cash equal to any Excess Consideration (as defined
below) received within the one hundred eighty (180) day period
immediately following the exercise of the Put due to an Adjustment
Event (as defined below). The Put is exercisable by the Holder at any
time and from time to time for eight (8) years from the date of
Issuance of this Warrant by giving written notice (the "Put Notice"
thereof to the Company, addressed as set forth in Section 3 above.
"Adjustment Event" means any event in which (a) the Company issues any
shares of Units or other similar ownership units in a Qualified IPO
for consideration per share that exceeds the amount received per share
by any Holder in connection with the exercise of the Put with respect
to such Holder; (b) any shareholder sells, transfers, pledges or
otherwise disposes of any equity interests of the Company for
consideration per share that exceeds the amount received per share by
any Holder in connection with the exercise of the Put with respect to
such Holder; (c) any person acquires equity interests of the Company
in connection with acquisition of the beneficial ownership of more
than fifty percent (50%) of the voting securities of the Company, or
acquires equity interests of the Company and the right to elect a
majority of the members of the Company's board of directors for a
consideration per share or unit that exceeds the amount received per
share by any such Holder in connection with the exercise of such Put;
(d) the Company sells all or a majority of its assets or revenue or
income generating capacity for such amount of consideration that, if
the Company were liquidated on the date that such sale is consummated,
the holders of any class of equity interests of the Company would
receive per share distributions exceeding the amount received per
share by any such Holder in connection with the exercise of such Put;
or (e) the Company participates in any merger, consolidation,
reorganization, share exchange, recapitalization, or similar
transaction or series of related transactions involving a change of
control of the Company or disposition of all or a majority of its
assets or revenue or income generating capacity, directly or
indirectly, in which the holders of any class of capital stock of the
Company receive per share consideration for. or distributions with
respect to, their shares in an amount that exceeds the amount received
per share by such Holder in connection with the exercise of such Put.
"Excess Consideration" means the amount that a Holder would have
realized following the Adjustment Event had the Put not been exercised
by such Holder until such time, minus the amount that such Holder
realized due to the exercise of the Put; provided however, that the
amount of Excess Consideration will in all events be deemed to be at
least zero. "Qualified IPO" means a public offering of the equity
interests of the Company listed on a registered securities exchange or
on the National Market tier of the Nasdaq Stock Market, Inc. with an
initial market value (defined as stock price multiplied by shares
outstanding on the first five (5) days of trading) of at least $50
million with a Daily Trading Volume of no less than three percent (3%)
for twenty (20) consecutive days. "Daily Trading Volume" means for any
day that percentage of outstanding equity units trading on a
registered securities exchange or on the National Market tier of the
Nasdaq Stock Market, Inc. on that day.
(b) The Company shall pay to the Holder, in cash or certified or cashier's
check, the Purchase Price in exchange for the delivery to the Company
of the Warrant within ten (10) days after the determination of the
Fair Market Value of the shares of equity interests of the Company.
(c) The Fair Market Value of the shares of Units of the Company issuable
pursuant to this Warrant shall be the greater of the following
valuation methods:
(i) If the Units is listed for trading on a national securities
exchange the Fair Market Value shall be the average of the
closing price for the five (5) trading days immediately after the
Company's receipt of the Put Notice.
(ii) If the Units is not listed for trading on a national securities
exchange, the Fair Market Value shall be the greater of the
following valuation methods:
(1) Within ten (10) days after the Company's receipt of the Put
Notice, the Company and the Holder shall appoint an
independent, experienced appraiser who is a member of a
recognized professional association of business appraisers
(who shall follow policies customarily applied in the
appraisal industry), who has at least ten (10) years
experience in appraising businesses and who is not an
Affiliate (as such term is defined in the Note Purchase
Agreement) of the Company or the Holder. The appraiser shall
determine the value of the shares of Units which would be
issued upon the exercise of this Warrant as of the end of
the month immediately prior to the date of the Put Notice,
taking into consideration that such shares would constitute
a minority interest, and would lack liquidity, and further
assuming that the transaction would be between a willing
buyer and a willing seller both of whom have full knowledge
of the financial and other affairs of the Company, and
neither of whom is under any compulsion to sell or to buy.
The appraiser shall make this determination and issue a
written report to the Company and Holder within thirty (30)
days after being appointed. If the Company and Holder fail
to agree on a qualified appraiser within the required tell
(10) day period, then the appraiser shall be appointed by
the American Arbitration Association. The fees and expenses
of the appraiser shall be paid by the Company.
(2) The book value of the Company, as determined according to
generally accepted accounting principles, consistently
applied, on the date of the Put Notice, multiplied by the
percent (the "Warrant Percent") of the issued and
outstanding capital stock of the Company represented by the
shares of Units subject to this Warrant (assuming such
shares were issued and outstanding). The determination of
the book value of the Company shall be determined by a
nationally recognized independent public accounting firm
mutually appointed by the Company and Holder who has not
been engaged by either party for one year prior to the date
of the Put Notice and who is not an Affiliate (as defined in
the Note Purchase Agreement) of the Company or the Holder.
The appointed accounting firm shall make the determination
and issue a report to the Company and Holder within thirty
(30) days after being appointed. If the Company and Holder
fail to agree on an accounting firm within ten (10) days
after the date of the Put Notice, the accounting firm shall
be appointed by the American Arbitration Association. All
fees and expenses of the accounting firm shall be paid by
the Company.
(3) The EBITDA of the Company for the twelve (12) month period
ending as of the end of the month immediately prior to the
date of the Put Notice multiplied by 5, less funded debt
outstanding, plus cash, as of the effective exercise date of
the Put, multiplied by the Warrant Percent. The term
"EBITDA" means earnings before interest, taxes, depreciation
and amortization, as determined according to generally
accepted accounting principles, consistently applied. The
determination of this EBITDA of the Company shall be
determined by a nationally recognized independent public
accounting firm mutually appointed by the Company and Holder
who has not been engaged by either party for one years prior
to the date of the Put Notice and who is not an Affiliate
(as defined in the Note Purchase Agreement) of the Company
or Holder. The appointed accounting firm shall make the
determination and issue a report to the Company and Holder
within thirty (30) days after being appointed. If the
Company and Holder fail to agree on an accounting firm
within ten (10) days after the date of the Put Notice, the
accounting firm shall be appointed by the American
Arbitration Association. All fees and expenses of the
accounting firm shall be paid by the Company.
10. Registration.
(a) The Company and the holders of the Shares agree that if at any time
the Company shall propose to file a registration statement with
respect to any of its Units on a form suitable for a secondary
offering, it will give notice in writing to such effect to the
registered holder(s) of the Shares at least thirty (30) days prior to
such filing, and, at the written request of any such registered
holder, made within ten (10) days after the receipt of such notice,
will include therein at the Company's cost and expense (including the
fees and expenses of counsel to such holder(s), but excluding
underwriting discounts, and commissions and filing fees attributable
to the Shares included therein) such of the Shares as such holder(s)
shall request; provided, however, that if the offering being
registered by the Company is underwritten and if the representative of
the underwriters certifies in writing, that the inclusion therein of
the Shares would materially and adversely affect the sale of the
securities to be sold by the Company thereunder, then the Company
shall be required to include in the offering, only that number of
securities, including the Shares, which the underwriters determine in
their sole discretion will not jeopardize the success of the offering
(the securities so included to be apportioned pro rata among all
selling shareholders according to the total amount of securities
entitled to be included therein owned by each selling shareholder).
(b) Whenever the Company in its sole discretion undertakes to effect the
registration of any of the Shares, the Company shall, as expeditiously
as reasonably possible:
(i) Prepare and file with the Securities and Exchange Commission (the
"Commission") a registration statement covering such Shares and
use its best efforts to cause such registration statement to be
declared effective by the Commission as expeditiously as possible
and to keep such registration effective until the earlier of (A)
the date when all Shares covered by the registration statement
have been sold or (B) two hundred seventy (270) days from the
effective date of the registration statement; provided, that
before filing a registration statement or prospectus or any
amendment or supplements thereto, the Company will furnish to
each holder of Shares covered by such registration statement and
the underwriters, if any, copies of all such documents proposed
to be filed (excluding exhibits, unless any such person shall
specifically request exhibits), which documents will be subject
to the review of all holders and underwriters, and the Company
will not file such registration statement or any amendment
thereto or any prospectus or any supplement thereto (including
any documents incorporated by reference therein) with the
Commission if (A) the underwriters if any, shall reasonably
object to such filing or (B) if information in such registration
statement or prospectus concerning a particular selling holder
has changed and such holder or the underwriters, if any, shall
reasonably object.
(ii) Prepare and file with the Commission such amendments and
post-effective amendments to such registration statement as may
be necessary to keep such registration statement effective during
the period referred to in subsection 10(b)(i) and to comply with
the provisions of the Securities Act with respect to the
disposition of all securities covered by such registration
statement, and cause the prospectus to be supplemented by any
required prospectus supplement, and as so supplemented to be
filed with the Commission pursuant to Rule 424 under the
Securities Act.
(iii)At the Company's expense, furnish to the selling holder(s) such
numbers of copies of such registration statement, each amendment
thereto, the prospectus included in such registration statement
(including each preliminary prospectus), each supplement thereto
and such other documents as they may reasonably request in order
to facilitate the disposition of the Shares owned by them.
(iv) Promptly notify each selling holder of the happening of any event
as a result of which the prospectus included in such registration
statement contains an untrue statement of a material fact or
omits any fact necessary to make the statements therein not
misleading and, at the request of any such holder, the Company
will prepare a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers of such Shares,
such prospectus will not contain an untrue statement of a
material fact or omit to state any fact necessary to make the
statements therein not misleading.
(v) Provide a transfer agent and registrar for all such Shares not
later than the effective date of such registration statement.
(vi) Enter into such customary agreements (including underwriting
agreements in customary form for a primary offering) and take all
such other actions as the underwriters, if any, reasonably
request in order to expedite or facilitate the disposition of
such Shares (including, without limitations effecting a stock
split or a combination of shares).
(vii)Make available for inspection by any selling holder or any
underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other
agent retained by any such selling holder or underwriter, all
financial and other records, pertinent corporate documents and
properties of the Company, and cause the officers, directors,
employees and independent accountants of the Company to supply
all information reasonably requested by any such seller,
underwriter, attorney, accountant or agent in connection with
such registration statement.
(viii) Promptly notify the selling holder(s) and the underwriters, if
any, of the following events and (if requested by any such
person) confirm such notification in writing: (A) the filing of
the prospectus or any prospectus supplement and the registration
statement and any amendment or post-effective supplement thereto
and, with respect to the registration statement or any
post-effective amendment thereto, the declaration of the
effectiveness of such documents; (B) any requests by the
Commission for amendments or supplements to the registration
statement or the prospectus or for additional information; (C)
the issuance or threat of issuance by the Commission of any stop
order suspending the effectiveness of the registration statement
or the initiation of any proceedings for that purpose; and (D)
the receipt by the Company of any notification with respect to
the suspension of the qualification of the Shares for sale in any
jurisdiction or the initiation or threat of initiation of any
proceeding for such purposes.
(ix) Make every reasonable effort to prevent the entry of any order
suspending the effectiveness of the registration statement and
obtain at the earliest possible moment the withdrawal of any such
order, if entered.
(x) Cooperate with the selling holder(s) and the underwriters, if
any, to facilitate the timely preparation and delivery of
certificates representing the Shares to be sold and not bearing
any restrictive legends, and enable such Shares to be in such
lots and registered in such names as the underwriters may request
at least two (2) business days prior to any delivery of the
Shares to the underwriters.
(xi) Provide a CUSIP number for all the Shares not later than the
effective date of the registration statement.
(xii)Otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, and make generally
available to its security holders earnings statements satisfying
the provisions of Section 11(a) of the Securities Act no later
than forty five (45) days after the end of any twelve-month
period (or ninety (90) days, if such period is a fiscal year) (A)
commencing at the end of any fiscal quarter in which the Shares
are sold to underwriters in a firm or best efforts underwritten
offering, or (B) if not sold to underwriters in such an offering,
beginning the first month of the first fiscal quarter of the
Company commencing after the effective date of the registration
statement, which statements shall cover such twelve-month
periods.
(c) After the date hereof, the Company shall not grant to any holder of
securities of the Company any registration rights which have a
priority greater than or equal to those granted to Holder pursuant to
this Warrant without the prior written consent of the Holder.
(d) Holder agrees to use its best good faith efforts to cooperate if
Holder is a selling unitholder. The Company's obligations under
Subsection 10(a) above with respect to each holder of Shares are
expressly conditioned upon such holder's furnishing to the Company in
writing such information concerning such holder and the terms of such
holder's proposed offering as the Company shall reasonably request for
inclusion in the registration statement. If any registration statement
including any of the Shares is filed, then the Company shall indemnify
each holder thereof (and each underwriter for such holder and each
person, if any, who controls such underwriter within the meaning of
the Securities Act) from any loss, claim, damage or liability arising
out of, based upon or in any way relating to any untrue statement of a
material fact contained in such registration statement or any omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading except for any
such statement or omission based on information furnished in writing
by such holder of the Shares expressly for use in connection with such
registration statement; and such holder shall indemnify the Company
(and each of its officers and directors who has signed such
registration statement, each director, each person, if any, who
controls the Company within the meaning of the Securities Act, each
underwriter for the Company and each person, if any, who controls such
underwriter within the meaning of the Securities Act) and each other
such holder against any loss, claim, damage or liability arising from
any such statement or omission which was made in reliance upon
information furnished in writing to the Company by such holder of the
Shares expressly for use in connection with such registration
statement.
(e) For purposes of this Section, all of the Shares shall be deemed to be
issued and outstanding.
11. Certain Notices. In case at any time the Company shall propose to:
(a) declare any cash dividend upon its Units;
(b) declare any dividend upon its Units payable in stock or make any
special dividend or other distribution to the holders of its Units;
(c) offer for subscription to the holders of any of its Units any
additional shares of stock in any class or other rights;
(d) reorganize, or reclassify the equity interests of the Company, or
consolidate, merge or otherwise combine with or sell all or
substantially all of its assets to, another corporation; or
(e) voluntarily or involuntarily dissolve, liquidate or wind up the
affairs of the Company,then, in any one or more of said cases, the
Company shall give to the Holder of this Warrant, by certified or
registered mail, (i) at least twenty (20) days' prior written notice
of the date on which the books of the Company shall close or a record
shall be taken for such dividend, distribution or subscription rights
or for determining rights to vote in respect of any such
reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up, and (ii) in the case of such
reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up, at least twenty (20) days'
prior written notice of the date when the same shall take place. Any
notice required by clause (i) shall also specify, in the case of any
such dividend, distribution or subscription rights, the date on which
the holders of Units shall be entitled thereto, and any notice
required by clause (ii) shall specify the date on which the holders of
Units shall be entitled to exchange their Units for securities or
other property deliverable upon such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up,
as the case may be.
12. Prohibited Sales. Neither Xxxxx X. Xxxxxxxxx nor Xxxxxxx X. Durharn nor
Xxxxxx Xxxxxxx (collectively, the "Limited Partners") shall enter into any
transaction that would result in the sale or pledge of any Units owned by
the Limited Partners.
13. Limitation on Interest. The Company and Holder intend to conform strictly
to the usury laws in force that apply to this transaction. Accordingly, all
agreements between the Company and Holder, whether now existing or
hereafter arising and whether written or oral, are hereby limited so that
in no contingency, whether by reason of acceleration of the indebtedness
evidenced by the Note or otherwise, shall the interest (and all other sums
that are deemed to be interest) contracted for, charged or received by
Holder with respect to such indebtedness exceed the maximum rate of
interest permitted to be charged under applicable law (the "Maximum Rate").
The Company and the Holder stipulate and represent that as of the date
hereof (the same being the date of the granting of this Warrant to the
Holder), the value of this Warrant, as compensation for the use of money,
is both contingent (in the sense that the future realization of any value
from the exercise of this Warrant is dependent upon the occurrence of
events beyond the control of the parties) and speculative (in the sense
that the amount, if any, which will be realized upon the exercise of this
Warrant is uncertain). The Company and the Holder stipulate and agree that
the terms and provisions contained in this Warrant are not intended to and
shall never be construed to create a contract to pay for the use,
forbearance or detention of money or, if so construed, to pay for the use,
forbearance or detention of money in an amount in excess of the Maximum
Rate permitted to be charged. Neither the Company nor any other party now
or hereafter becoming liable for payment of the Note shall ever be required
to pay interest on or with respect to the Note in an amount in excess of
the Maximum Rate that lawfully may be charged, and the provisions of this
Section shall control over all other provisions of this Agreement and the
Note. If the difference between (i) the Fair Market Value (determined as of
the date hereof or such other date as required by applicable law) of the
Shares, and (ii) the Exercise Price with respect to such Shares, could ever
be or is deemed to constitute interest in an amount that, when taken
together with the interest otherwise contracted for, charged or received
with respect to the Note, would exceed the Maximum Rate, the Exercise Price
with respect to the Shares shall automatically be increased by an amount
equal to such excess, or if this Warrant has been exercised, the Holder
shall, at the option of Holder, either refund to the Company the amount of
such excess or credit the amount of such excess against the principal
balance of the Note. All amounts not payable to Holder under this Warrant
on account of the foregoing limitations shall be retained by the Company,
provided that, if at a later date prior to the termination of this Warrant,
Holder determines that a greater amount could lawfully be paid to it, then
the Company shall immediately upon request of Holder, pay to Holder such
greater amount up to an amount equal to the aggregate of all amounts that
were retained by the Company on account of such limitation on the amount of
interest that the Holder could receive on or with respect to any notes
under applicable law. All interest paid or agreed to be paid to Holder
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full period until payment in full of
the principal of such indebtedness (including the period of any renewal or
extension thereof) so that the interest for such full period shall not
exceed the Maximum Rate. The term "applicable law" as used in this
Agreement shall mean the laws of the State of Texas or the laws of the
United States applicable to transactions in Texas, whichever laws allow the
greater rate of interest as such laws now exist or may be changed or
amended or come into effect in the future.
14. GOVERNING LAW; VENUE; SUBMISSION TO JURISDICTION. THIS WARRANT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS. THIS WARRANT IS PERFORMABLE BY THE PARTIES IN DALLAS COUNTY, TEXAS.
THE COMPANY AND HOLDER EACH AGREE THAT DALLAS COUNTY, TEXAS SHALL BE THE
EXCLUSIVE VENUE FOR LITIGATION OF ANY DISPUTE OR CLAIM ARISING UNDER OR
RELATING TO THIS WARRANT. AND THAT SUCH COUNTY IS A CONVENIENT FORUM IN
WHICH TO DECIDE ANY SUCH DISPUTE OR CLAIM. THE COMPANY AND HOLDER EACH
CONSENT TO THE PERSONAL JURISDICTION OF THE STATE AND FEDERAL COURTS
LOCATED IN DALLAS COUNTY, TEXAS FOR THE LITIGATION OF ANY SUCH DISPUTE OR
CLAIM. THE COMPANY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE
VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY
SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
15. Severability. If any provision(s) of this Warrant or the application
thereof to any person or circumstances shall be invalid or unenforceable to
any extent, the remainder of this Warrant and the application of such
provisions to other persons or circumstances shall not be affected thereby
and shall be enforced to the greatest extent permitted by law.
16. Counterparts. This Warrant may be executed in any number of counterparts
and by different parties to this Warrant in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same Warrant.
17. WAIVER OF JURY TRIAL. THE COMPANY AND HOLDER EACH HEREBY IRREVOCABLY
WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY AT ANY
TIME ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS WARRANT OR ANY
TRANSACTION CONTEMPLATED HEREBY OR ASSOCIATED HEREWITH.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have set their hands as of the date
first above written.
CHAMPION TRAILER COMPANY, L.P.,
an Indiana limited partnership
By: Durham Xxxxxxxxx & Associates, LLC,
its general partner
By: /s/ Xxxxx Xxxxxxxxx
Name: Xxxxx Xxxxxxxxx
Title: Member
MARKPOINT EQUITY GROWTH FUND, J.V.
By: The Markpoint Company, its managing
venturer
By: /s/ Xxx Xxxxxx
President
The undersigned Limited Partners join in the execution of this Warrant for
the purposes of acknowledging and agreeing to be bound by Section 12 hereof.
By: /s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
By: /s/ Xxxxx X. Xxxxxxxxx
Xxxxx X. Xxxxxxxxx
By: /s/ Xxxxxx Xxxxxxx
Xxxxxx Xxxxxxx
