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EXHIBIT 6.12
WARRANT ANTIDILUTION AGREEMENT
THIS WARRANT ANTIDILUTION AGREEMENT (the "Agreement") is entered into as
of July 13, 2001, by and among InterGlobal Waste Management, Inc., a
corporation duly organized and existing under the laws of the State of
California (the "Company") and Xxxxxx Private Equity, LLC (hereinafter referred
to as "Xxxxxx").
RECITALS:
WHEREAS, pursuant to the Company's offering ("EQUITY LINE") of up to Forty
Million Dollars ($40,000,000), excluding any funds paid upon exercise of the
Warrants, of Common Stock of the Company pursuant to that certain Investment
Agreement (the "Investment Agreement") between the Company and Xxxxxx dated on
or about July 13, 2001, the Company has agreed to sell and Xxxxxx has agreed to
purchase, from time to time as provided in the Investment Agreement, shares of
the Company's Common Stock for a maximum aggregate offering amount of Forty
Million Dollars ($40,000,000); and
WHEREAS, pursuant to the terms of the Investment Agreement, the Company
has agreed, among other things, to issue to Xxxxxx Commitment Warrants, as
defined in the Investment Agreement, to purchase a number of shares of Common
Stock, exercisable for five (5) years from their respective dates of issuance.
TERMS:
NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties, covenants and conditions set forth in this Agreement and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Issuance of Commitment Warrants. As compensation for entering into the
Equity Line, Xxxxxx received a warrant convertible into 2,400,000 shares of the
Company's Common Stock, in the form attached hereto as Exhibit A (the
"Commitment Warrants").
2. Issuance of Additional Warrants. If, anytime during the term of the
Commitment Warrant, the Company issues shares of common stock, warrants, or
options (excluding any shares issued or issuable to Xxxxxx) (collectively, the
"MFN Shares") at an issue price (the "MFN Price") which is below $1.50 (which
$1.50 value shall be adjusted up or down, as appropriate, to account for stock
splits or reverse stock splits occurring after the date hereof), the Company
shall issue to Xxxxxx a number of additional warrants ("Additional Warrants")
equal to 3.4% of the number of MFN Shares. The Additional Warrants shall be in
the form of Exhibit A hereto, and shall initially be exercisable at the
applicable MFN Price, shall have the same reset provisions as the Commitment
Warrants (which resets shall occur on each six month anniversary of the date of
issuance of the applicable Additional Warrant throughout the term of the
applicable Additional Warrant), shall have piggyback registration rights and
shall have a 5-year term.
3. Opinion of Counsel. Concurrently with the issuance and delivery of the
Commitment Opinion (as defined in the Investment Agreement) to the Investor, or
on the date that is six (6) months after the date of this Agreement, whichever
is sooner, the Company shall deliver to the Investor an Opinion of Counsel
(signed by the Company's independent counsel) covering the
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issuance of the Commitment Warrants and the Additional Warrants, and the
issuance and resale of the Common Stock issuable upon exercise of the Warrants
and the Additional Warrants.
4. Change in Corporate Entity. The Company shall not, at any time after the
date hereof, enter into any merger, consolidation or corporate reorganization
of the Company with or into, or transfer all or substantially all of the assets
of the Company to, another entity unless the resulting successor or acquiring
entity in such transaction, if not the Company (the "Surviving Entity"), (i)
has Common Stock listed for trading on Nasdaq or on another national stock
exchange and is a Reporting Issuer, (ii) assumes by written instrument the
Company's obligations with respect to this Warrant Antidilution Agreement and
the Additional Warrants, including but not limited to the obligations to
deliver to the Investor shares of Common Stock and/or securities that Investor
is entitled to receive pursuant to this Investment Agreement and upon exercise
of the Additional Warrants and agrees by written instrument to reissue, in the
name of the Surviving Entity, any Additional Warrants (each in the same terms,
including but not limited to the same reset provisions, as the Commitment
Warrants originally issued or required to be issued by the Company) that are
outstanding immediately prior to such transaction, making appropriate
proportional adjustments to the number of shares represented by such Warrants
and the exercise prices of such Warrants to accurately reflect the exchange
represented by the transaction.
5. Termination of Investment Agreement. Notwithstanding any Termination or
Automatic Termination (as each is defined in the Investment Agreement) of the
Investment Agreement, this Agreement, including but not limited to the
Company's obligation to issue Additional Warrants, shall remain in full force
and effect throughout the term of the Commitment Warrants, and may not be
terminated.
6. Arbitration; Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Georgia applicable to
agreements made in and wholly to be performed in that jurisdiction, except for
matters arising under the Act or the Securities Exchange Act of 1934, which
matters shall be construed and interpreted in accordance with such laws. Any
controversy or claim arising out of or related to the Transaction Documents or
the breach thereof, shall be settled by binding arbitration in Atlanta, Georgia
in accordance with the Expedited Procedures (Rules 53-57) of the Commercial
Arbitration Rules of the American Arbitration Association ("AAA"). A proceeding
shall be commenced upon written demand by Company or any Investor to the other.
The arbitrator(s) shall enter a judgment by default against any party, which
fails or refuses to appear in any properly noticed arbitration proceeding. The
proceeding shall be conducted by one (1) arbitrator, unless the amount alleged
to be in dispute exceeds two hundred fifty thousand dollars ($250,000), in which
case three (3) arbitrators shall preside. The arbitrator(s) will be chosen by
the parties from a list provided by the AAA, and if they are unable to agree
within ten (10) days, the AAA shall select the arbitrator(s). The arbitrators
must be experts in securities law and financial transactions. The arbitrators
shall assess costs and expenses of the arbitration, including all attorneys' and
experts' fees, as the arbitrators believe is appropriate in light of the merits
of the parties' respective positions in the issues in dispute. Each party
submits irrevocably to the jurisdiction of any state court sitting in Atlanta,
Georgia or to the United States District Court sitting in Georgia for purposes
of enforcement of any discovery order, judgment or award in connection with
such arbitration. The award of the arbitrator(s) shall be final and binding upon
the parties and may be enforced in any court having jurisdiction. The
arbitration shall be held in such place as set by the arbitrator(s) in
accordance with Rule 55.
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Although the parties, as expressed above, agree that all claims, including
claims that are equitable in nature, for example specific performance, shall
initially be prosecuted in the binding arbitration procedure outlined above, if
the arbitration panel dismisses or otherwise fails to entertain any or all of
the equitable claims asserted by reason of the fact that it lacks jurisdiction,
power and/or authority to consider such claims and/or direct the remedy
requested, then, in only that event, will the parties have the right to
initiate litigation respecting such equitable claims or remedies. The forum for
such equitable relief shall be in either a state or federal court sitting in
Atlanta, Georgia. Each party waives any right to a trial by jury, assuming such
right exists in an equitable proceeding, and irrevocably submits to the
jurisdiction of said Georgia court. Georgia law shall govern both the
proceeding as well as the interpretation and construction of this Agreement and
the transaction as a whole.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
this 13th day of July, 2001.
INTERGLOBAL WASTE SUBSCRIBER:
MANAGEMENT, INC. XXXXXX PRIVATE EQUITY, LLC.
By: /s/ XXXXXX XXXXXXXX By: /s/ XXXX XXXXXX
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Xxxxxx Xxxxxxxx Xxxx X. Xxxxxx, Manager
Chairman of the Board
000 Xxxxx Xxxxx 000 Xxxxxxxx Xxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000 Suite 300
Telephone: (000) 000-0000 Xxxxxxx, XX 00000
Facsimile: (000) 000-0000 Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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