EXHIBIT 10.08
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD OR
TRANSFERRED UNLESS SUCH SALE OR TRANSFER IS IN ACCORDANCE WITH THE REGISTRATION
REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS OR SOME OTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS IS AVAILABLE WITH
RESPECT THERETO.
COMMON STOCK PURCHASE WARRANT
WARRANT NUMBER: MACC- 001
FOUR HUNDRED SIXTY-SEVEN THOUSAND (467,000) SHARES
MORTGAGE ASSISTANCE CENTER CORPORATION
1. Issuance. This Warrant is issued to Xxxxxxx Xxxxx Xx., a resident of
Irving, Texas, ("Caolo") by Mortgage Assistance Center Corporation, a Florida
corporation with its corporate offices at 0000 Xxxx Xxxxxx, Xxxxxx, Xxxxx 00000
(hereinafter with its successors called the "Company").
2. Purchase Price; Number of Shares. Subject to the terms and
conditions hereinafter set forth, Caolo, as the initial registered holder of
this Warrant, commencing on the date hereof, is entitled upon surrender of this
Warrant with the subscription form annexed hereto (the "Subscription Form") duly
executed, at the office of the Company or such other office as the Company shall
notify Caolo of in writing, to purchase from the Company at the price of $0.39
per share (the "Purchase Price") FOUR HUNDRED SIXTY-SEVEN THOUSAND (467,000)
SHARES (the "Warrant Shares") of common stock, $0.001 par value, of the Company
(the "Common Stock") (the "Warrant Shares"). This Warrant is fully vested.
3. Payment of Purchase Price.
(a) Method of Exercise. Subject to the provisions of this Warrant,
Caolo may exercise this Warrant in whole or in part at any time and from time to
time on and after the issuance hereof upon surrender of the Warrant, together
with delivery of the duly executed Subscription Form (which may be by fax), to
the Company during normal business hours on any business day at the Company's
principal executive offices, and upon payment to the Company of the Exercise
Price for the Warrant Shares specified in the Subscription Form. Certificates
for the Warrant Shares so purchased, representing the aggregate number of shares
specified in the Subscription Notice, shall be delivered to Caolo 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 Caolo and shall be registered in the name
of Caolo or such other name as shall be designated by Caolo. 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 Caolo a new Warrant representing the percentage of shares with
respect to which this Warrant shall not then have been exercised.
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(b) Method of Payment. The Purchase Price may be paid in cash, by check
or wire transfer in immediately available funds, or by cashless exercise as
provided in 3(b) below.
(c) Cashless Exercise. Notwithstanding anything to the contrary
contained in Section 3, Caolo shall have the right to pay the aggregate Exercise
Price by "Cashless Exercise". To effect a Cashless Exercise, Caolo shall submit
to the Company on the Subscription Form written notice of the Caolo's intention
to do so, including a calculation of the number of shares of Common Stock to be
issued upon such exercise in accordance with the terms hereof. In the event of a
Cashless Exercise, in lieu of paying the Exercise Price in cash, Caolo shall
surrender this Warrant for that number of Warrant Shares of Common Stock
determined by multiplying the number of Warrant Shares to which he would
otherwise be entitled by a fraction, the numerator of which shall be the
difference between the then current Fair Market Value per share of the Common
Stock and the applicable Exercise Price, and the denominator of which shall be
the then current Fair Market Value per share of the Common Stock. For this
purpose, the "Fair Market Value" of the Common Stock shall be the average of the
closing sale prices of the Common Stock as reported by the Principal Market for
the ten (10) trailing average price of the Company's Common Stock for the period
immediately preceding the Exercise Date, or, if at the time of exercise there is
no public market, as determined in good faith by the Company's Board of
Directors
4. Partial Exercise. This Warrant may be exercised in part, and Caolo
shall be entitled to receive a new warrant, which shall be dated as of the date
of this Warrant, covering the number of shares in respect of which this Warrant
shall not have been exercised.
5. Issuance Date. The person or persons in whose name or names any
certificate representing shares of Common Stock is issued hereunder shall be
deemed to have become holder of record of the shares represented thereby as at
the close of business on the date this Warrant is exercised with respect to such
shares, whether or not the transfer books of the Company shall be closed.
6. Expiration Date. This Warrant shall expire at the close of business
on November 30, 2011, and shall be void thereafter.
7. Reserved Shares; Valid Issuance. The Company covenants that it will
at all times from and after the date hereof reserve and keep available such
number of its authorized shares of Common Stock, free from all preemptive or
similar rights therein, as will be sufficient to permit the exercise of this
Warrant in full. The Company further covenants that such shares 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 issuance thereof.
8. Adjustment of Number of Shares; Exercise Price; Nature of Securities
Issuable Upon Exercise of Warrants.
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(a) Exercise Price; Adjustment of Number of Shares. The Exercise Price
and the number of shares purchasable hereunder shall be subject to adjustment
from time to time as hereinafter provided.
(b) Reorganization, Reclassification, Consolidation, Merger or Sale. If
any capital reorganization or reclassification of the capital stock of the
Company, or any consolidation or merger of the Company with another entity, or
the sale of all or substantially all of the Company's assets to another person
or entity (collectively referred to as a "Transaction") shall be effected in
such a way that holders of Common Stock shall be entitled to receive stock,
securities, cash or assets with respect to or in exchange for Common Stock,
then, as a condition of such Transaction, reasonable, lawful and adequate
provisions shall be made whereby Caolo shall thereafter have the right to
purchase and receive upon the basis and upon the terms and conditions specified
in this Warrant, upon exercise of this Warrant and in lieu of the Warrant Shares
immediately theretofore purchasable and receivable upon the exercise of the
rights represented hereby, such number, amount and like kind of shares of stock,
securities, cash or assets as may be issued or payable pursuant to the terms of
the Transaction with respect to or in exchange for the number of shares of
Common Stock immediately theretofore purchasable and receivable upon the
exercise of the rights represented hereby as if such shares were outstanding
immediately prior to the Transaction, and in any such case appropriate provision
shall be made with respect to the rights and interest of Caolo to the end that
the provisions hereof (including, without limitation, provisions for adjustments
of the Exercise Price and of the number of Warrant Shares purchasable and
receivable upon the exercise of this Warrant) shall thereafter be applicable, as
nearly as may be practicable, in relation to any shares of stock or securities
thereafter deliverable upon the exercise hereof.
(c) Stock Splits, Stock Dividends and Reverse Stock Splits. If at any
time the Company shall subdivide its outstanding shares of Common Stock into a
greater number of shares, or shall declare and pay any stock dividend with
respect to its outstanding stock that has the effect of increasing the number of
outstanding shares of Common Stock, the Exercise Price in effect immediately
prior to such subdivision or stock dividend shall be proportionately reduced and
the number of Warrant Shares purchasable pursuant to this Warrant immediately
prior to such subdivision or stock dividend shall be proportionately increased,
and conversely, in case at any time the Company shall combine its outstanding
shares of Common Stock into a smaller number of shares, the Exercise Price in
effect immediately prior to such combination shall be proportionately increased
and the number of Warrant Shares purchasable upon the exercise of this Warrant
immediately prior to such combination shall be proportionately reduced.
(d) Dissolution, Liquidation or Wind-Up. In case the Company shall, at
any time prior to the exercise of this Warrant, dissolve, liquidate or wind up
its affairs, Caolo shall be entitled, upon the exercise of this Warrant, to
receive, in lieu of the Warrant Shares which Caolo would have been entitled to
receive, the same kind and amount of assets as would have been issued,
distributed or paid to Caolo upon any such dissolution, liquidation or winding
up with respect to such Warrant Shares, had Caolo been the holder of record of
the Warrant Shares receivable upon the exercise of this Warrant on the record
date for the determination of those persons entitled to receive any such
liquidating distribution.
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(e) Accountant's Certificate. In each case of an adjustment in the
Exercise Price, number of Warrant Shares or other stock, securities or property
receivable upon the exercise of this Warrant, the Company shall compute such
adjustment in accordance with the terms of this Warrant and prepare a
certificate setting forth such adjustment and showing in detail the facts upon
which such adjustment is based, including a statement of (i) the number of
shares of Common Stock of each class outstanding or deemed to be outstanding,
(ii) the adjusted Exercise Price and (iii) the number of Warrant Shares issuable
upon exercise of this Warrant. The Company will forthwith mail a copy of each
such certificate to Caolo. In the event that Caolo disputes such adjustment,
Caolo shall be entitled to select an independent certified public accountant
firm of national standing and paid for equally by the Company and Caolo to
certify such adjustment and the Company and Caolo shall use their good faith
best efforts to agree on such adjustment based on the report of the accounting
firm. In the event that the Company and Caolo are still unable to reach
agreement as to such adjustment, the Company and Caolo agree to submit such
determination to binding arbitration. Upon determination of such adjustment, the
Company's Board of Directors shall forthwith make the adjustments described
therein.
9. Fractional Shares. In no event shall any fractional share of Common
Stock be issued upon any exercise of this Warrant. If, upon exercise of this
Warrant as an entirety, Caolo would, except as provided in this Section 9, be
entitled to receive a fractional share of Common Stock, then the Company shall
issue the next higher number of full shares of Common Stock, issuing a full
share with respect to such fractional share.
10. Notices of Record Date, Etc. In the event of:
(a) any taking by the Company of a record of holders of any class of
securities for the purpose of determining holders thereof who are entitled to
receive any dividend or other distribution, or any right to subscribe for,
purchase or otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other right;
(b) any reclassification of the capital stock of the Company, capital
reorganization of the Company, consolidation or merger involving the Company, or
sale or conveyance of all or substantially all of its assets, or
(c) any voluntary or involuntary dissolution, liquidation or winding-up
of the Company,
then and in each such event the Company will mail or cause to be mailed to Caolo
a notice specifying (i) the date on which any such record is to be taken for the
purpose of such dividend, distribution or right, and stating the amount and
character of such dividend, distribution or right, or (ii) the date on which any
such reclassification, reorganization, consolidation, merger, sale or
conveyance, dissolution, liquidation or winding-up is to take place, and the
time, if any is to be fixed, as of which Holders of record in respect of such
event are to be determined. Such notice shall be mailed at least 20 days prior
to the date specified in such notice on which any such action is to be taken.
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11. Amendment. The terms of this Warrant may be amended, modified or
waived only with the written consent of the Company and Caolo.
12. Governing Law. The provisions and terms of this Warrant shall be
governed by and construed in accordance with the internal laws of the State of
Texas.
13. Successors and Assigns. This Warrant shall be binding upon the
Company's successors and assigns and shall inure to the benefit of Caolo's
successors, legal representatives and permitted assigns.
14. Business Days. If the last or appointed day for the taking of any
action required or the expiration of any right granted herein shall be a
Saturday or Sunday or a legal holiday, then such action may be taken or right
may be exercised on the next succeeding day which is not a Saturday or Sunday or
such a legal holiday.
15 Replacement of Warrant. Upon receipt of evidence satisfactory to the
Company of the loss, theft, mutilation or destruction of this Warrant, and in
the case of any such loss, theft or destruction upon delivery of an agreement of
indemnity in such form and amount as shall be reasonably satisfactory to the
Company, or in the event of such mutilation upon surrender and cancellation of
this Warrant, the Company will make and deliver a new Warrant of like tenor, in
the name of Caolo, in lieu of such lost, stolen, destroyed or mutilated Warrant.
This Warrant shall be promptly canceled by the Company upon the surrender of
this Warrant in connection with any exchange or replacement.
16. Piggy-Back Registration Right. If the Company decides at any time
to register any of the Company's securities either for the Company's own
account, other than a registration relating solely to employee benefit plans,
the offer and sale of debt securities, or a corporate reorganization or other
transaction on Form S-4 (or any successor form), then the Company will (i)
promptly give to each Holder written notice thereof, and (ii) use its best
efforts to include in such registration (and any related qualification under
blue sky securities laws or other compliance), and include in any underwriting
involved therein, all the Warrant Shares specified in a written request or
requests made by Caolo and received by the Company within thirty (30) days after
written notice is delivered by the Company. If the registration for which the
Company gives notice is for a registered public offering involving an
underwriting, then the Company will so advise Caolo. In such event, Caolo's
right to registration pursuant to this Section 16 will be conditioned upon Caolo
enter into an underwriting agreement in customary form with the representative
of the underwriter or underwriters selected by the Company. Notwithstanding the
foregoing, if the underwriters' representative advises the Company in writing
that marketing factors require a limitation on the number of shares to be
underwritten, then the underwriters' representative may (subject to the
limitations set forth below) limit the number of Warrant Shares to be included
in, the registration and underwriting.
[SIGNATURE PAGE TO FOLLOW]
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Original Issue Date: November 30, 2006
MORTGAGE ASSISTANCE CENTER CORPORATION
By: ____________________________
Name:___________________________
Title: _________________________
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SUBSCRIPTION FORM
To:____________________ Date:_________________________
The undersigned hereby subscribes for __________ shares of Common Stock
covered by this Warrant. The certificate(s) for such shares shall be issued in
the name of the undersigned or as otherwise indicated below:
______________________________
Signature
______________________________
Name for Registration
______________________________
Mailing Address
ASSIGNMENT
For value received ____________________________ hereby sells, assigns
and transfers unto____________________________________________________________,
Please print name and address of Assignee
the within Warrant, and does hereby irrevocably constitute and appoint
___________ his attorney to transfer the within Warrant on the books of the
within named Company with full power of substitution on the premises.
BY:_________________________________ DATED: ______________________
In the Presence of:
______________________________
