NOTE AND WARRANT PURCHASE AGREEMENT
This NOTE AND WARRANT PURCHASE AGREEMENT (this "Agreement") is made as
of August 20, 2002 by and between Trinity Companies, Inc., a Utah
corporation (the "Company"), and the purchasers, severally and not jointly,
listed on Schedule A hereto (collectively, the "Purchasers," and
individually, a "Purchaser").
Recitals
A. Each Purchaser desires to acquire from the Company, and the
Company desires to issue to each Purchaser, a Convertible Promissory Note
and a Warrant substantially in the form attached hereto as Exhibit A (the
"Note") and Exhibit B (the "Warrant"); and
B. The Company and each Purchaser further desire to obligate themselves
as set forth in this Agreement and to make the representations and
warranties set forth in below, respectively, in connection with the
transactions contemplated hereby.
Accordingly, in consideration of the premises and the mutual promises
herein set forth, and in consideration of the representations and
warranties herein contained, the parties agree as follows:
Agreement
1. Purchase and Sale of the Note and Warrant.
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Subject to the terms and conditions of this Agreement, at the
Initial Closing and any Subsequent Closings the Company shall issue and
sell to each Purchaser, and each Purchaser shall purchase from the Company,
a Note and Warrant. The purchase price for each Note and Warrant at the
Initial Closing shall be the aggregate principal amount of such Note as set
forth on Schedule A hereto (the "Initial Purchase Price"). The purchase
price for each Note at any Subsequent Closings shall be the aggregate
principal amount of such Note as set forth on the Note delivered by Company
to the applicable Purchaser. Each such Note shall be dated as of the date
that the Company received funds from such Purchaser. The aggregate
principal amount of all Notes issued at the Initial Closing or Subsequent
Closings shall be $500,000.
2. The Closings.
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The issuance of the Notes to the Purchasers shall take place
concurrently with the execution of this Agreement at the offices of the
Company or at such other time and place as the Company and the Purchasers
shall agree (which time is referred to herein as the "Initial Closing").
At the Initial Closing and each subsequent closing (the "Subsequent
Closings") the Company shall deliver to each Purchaser a Note, with each
Note made payable to the Purchaser in the aggregate principal amount
advanced by the Purchaser at that Closing and shall amend Exhibit A to
include such Purchaser.
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3. Representations and Warranties of the Company.
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(a) Organization; Authority.
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The Company hereby represents and warrants to each Purchaser that
it is a corporation validly existing and in good standing under the
laws of the State of Utah and is authorized to execute and deliver
this Agreement and the Notes and Warrants.
(b) Piggyback Registration.
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(1) Right to Piggyback.
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Whenever the Company proposes to register any of its
equity securities under the Securities Act of 1933, as amended (the
"Securities Act") (other than a registration on Form S-4 or S-8 or any
successor or similar forms) and the registration form to be used may
be used for the registration of Common Stock (a "Piggyback
Registration"), whether or not for sale for its own account, the
Company will give prompt written notice to each Purchaser of its
intention to effect such a registration and, subject to any cutbacks
imposed by the underwriters and such other customary terms and
conditions, will include in such registration all Common Stock
converted under the Notes and exercised pursuant to the Warrants
("Registrable Securities") with respect to which the Company has
received written requests for inclusion therein within 15 days after
the receipt of the Company's notice; provided that with respect to any
Piggyback Registration, the holders of a majority of the aggregate
shares of Registrable Securities shall have the right to waive and
forego, as against all holders of Registrable Securities, the
inclusion of any Registrable Securities in such Piggyback
Registration.
(2) Piggyback Expenses.
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In all Piggyback Registrations, the registration
expenses (except for sales commissions) will be paid by the Company.
(3) Withdrawal by Company.
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If, at any time after giving notice of its intention to
register any of its securities as set forth in this Section 3(b) and
before the effective date of such registration statement filed in
connection with such registration, the Company shall determine, for
any reason, not to register such securities, the Company may, at its
sole discretion, give written notice of such determination to each
holder of Registrable Securities and thereupon shall be relieved of
its obligation to register any Registrable Securities in connection
with such registration.
4. Representations and Warranties of the Purchaser.
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Each Purchaser hereby represents and warrants to the Company
that:
a. Such Purchaser is an individual duly authorized and
empowered or a corporation, partnership or limited liability company
duly organized, validly existing and in good standing under the laws
of the jurisdiction of its organization.
b. Such Purchaser has the legal capacity or full power and
authority to enter into this Agreement, and this Agreement, when
executed and delivered, will constitute a valid and legally binding
obligation of such Purchaser, enforceable against such Purchaser in
accordance with its terms.
c. Such Purchaser is acquiring and will hold the Purchaser's
Note and Warrant for investment for its account only and not with a
view to, or for resale in connection with, any "distribution" thereof
within the meaning of the Securities Act.
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d. Such Purchaser understands that such Purchaser's Note and
Warrant (and the securities underlying the Warrant (the "Warrant
Shares")) have not been registered under the Securities Act by reason
of a specific exemption therefrom and that each of the Note, Warrant
and the Warrant Shares must be held indefinitely, unless subsequently
registered under the Securities Act or the Purchaser obtains an
opinion of counsel, in form and substance satisfactory to the Company
and its counsel, that such registration is not required.
e. Such Purchaser is aware of the adoption of Rule 144 by the
Securities and Exchange Commission under the Securities Act, which
permits limited public resales of securities acquired in a non-public
offering, subject to the satisfaction of certain conditions, including
(without limitation) the availability of certain current public
information about the issuer, the resale occurring only after the
holding period required by Rule 144 has been satisfied, the sale
occurring through an unsolicited "broker's transaction," and the
amount of securities being sold during any three-month period not
exceeding specified limitations. Such Purchaser acknowledges and
understands that the conditions for resale set forth in Rule 144 have
not been satisfied and that the Company has no plans to satisfy these
conditions in the foreseeable future.
f. Such Purchaser will not sell, transfer or otherwise dispose
of such Purchaser's Note, Warrant or Warrant Shares in violation of
the Securities Act, the Securities Exchange Act of 1934, as amended,
or the rules promulgated thereunder, including Rule 144 under the
Securities Act. Such Purchaser agrees that it will not dispose of
such Note and Warrant unless and until it has complied with all
requirements of this Agreement applicable to the disposition of such
Note, Warrant or Warrant Shares.
g. Such Purchaser has been furnished with, and has had access
to, such information as it considers necessary or appropriate for
deciding whether to invest in such Purchaser's Note and Warrant, and
such Purchaser has had an opportunity to ask questions and receive
answers from the Company regarding the terms and conditions of the
issuance of such Note and Warrant.
h. Such Purchaser is aware that its investment in the Company
is a speculative investment that has limited liquidity and is subject
to the risk of complete loss. Such Purchaser is able, without
impairing its financial condition, to hold such Purchaser's Note,
Warrant and Warrant Shares for an indefinite period and to suffer a
complete loss of its investment in such Note, Warrant and Warrant
Shares. Such Purchaser understands that an investment in such Note
and Warrant involves a high degree of risk. Such Purchaser is an
"accredited investor" as such term is defined in Regulation D
promulgated under the Securities Act.
5. Miscellaneous.
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(a) Entire Agreement. This Agreement and the other documents
required to be delivered pursuant hereto, if any, constitute the
entire understanding and agreement between the parties with regard to
the specific subject matter hereof.
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(b) Successors and Assigns. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the
benefit of and be binding upon the respective successors and assigns
of the parties.
(c) Governing Law. This Agreement shall be governed by and
construed under the laws of the State of Utah as applied to agreements
among Utah residents entered into and to be performed entirely within
the State of Utah.
(d) Counterparts. This Agreement may be executed by facsimile
and in two or more counterparts, each of which shall be deemed an
original, but all of which, when taken together, shall constitute one
and the same instrument.
(e) Notices. All notices, requests, demands, claims and other
communications hereunder shall be in writing. Any notice, request,
demand, claim or other communication hereunder shall be deemed duly
given if (and then two business days after) it is sent by registered
or certified mail, return receipt requested, postage prepaid, and
addressed to the intended recipient, as set forth below:
Trinity Companies, Inc.
0000 Xxxxxx Xxx, 0xx Xxxxx
Xxxxxxxx, XX 00000
Attention: President
To any Purchaser at the address set forth on Schedule A
hereto.
Any party may send any notice, request, demand, claim or other
communication hereunder to the intended recipient at the address set forth
above using any other means (including personal delivery, expedited
courier, messenger service, facsimile, ordinary mail, or electronic mail),
but no such notice, request, demand, claim or other communication shall be
deemed to have been duly given unless and until it actually is received by
the intended recipient or receipt is confirmed electronically or by return
mail. Any party may change the address to which notices, requests,
demands, claims and other communications hereunder are to be delivered by
giving the other parties notice in any manner herein set forth.
(f) Attorneys' Fees. If any action at law or in equity is
necessary to enforce or interpret the terms of this Agreement or any
document or instrument contemplated hereby or referred to herein, the
prevailing party or parties, as the case may be, shall be entitled to
reasonable attorneys' fees, costs and disbursements in addition to any
other relief to which such party or parties may otherwise be entitled.
(g) Amendments and Waivers. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively
or prospectively), only with the written consent of the Purchasers
holding a majority of the face value of all then outstanding Notes;
provided, however, that this Agreement may be amended by the Company
to provide for additional Purchasers without the consent of the
Purchasers.
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(h) Severability. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision or
provisions shall be excluded from this Agreement and the balance of
this Agreement shall be interpreted as if such provision or provisions
were so excluded and shall be enforceable in accordance with its
terms.
(i) Incorporation of Recitals and Exhibits. The above Recitals
and all Exhibits identified in or attached to this Agreement are
deemed to be incorporated herein by reference and made a part hereof.
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IN WITNESS WHEREOF, the parties have executed this Note and Warrant
Purchase Agreement as of the date first above written.
TRINITY COMPANIES, INC.
By:
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Name: Xxxx Xxxx
Its: President
KINGS PEAK ADVISORS, LLC
By:
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Name: Xxxxxx Xxxxxx
Its: Managing Member
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Xxx Xxxxxxxx
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Xxxxxxxxx Xxxxxx
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Xxxxx X. Xxxx
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Xxxx-Xxxx Perrette
CATALUNYA GROUP CORP.
By:
---------------------------------
Name:
---------------------------------
Its:
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[SIGNATURE PAGE TO NOTE AND WARRANT PURCHASE AGREEMENT]
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IN WITNESS WHEREOF, the parties have executed this Note and Warrant
Purchase Agreement as of the date first above written.
___________________________________
Xxx Xxxxxxxxx
___________________________________
Xxxx Xxxxxxxxxxx
___________________________________
Xxxx Xxxxx
ELMWOOD CAPTIAL LLC
By: ______________________________
Name: Xxxx Xxxxxx
Its Managing Member
[ADDITIONAL PURCHASERS' SIGNATURE PAGE TO NOTE AND WARRANT
PURCHASE AGREEMENT]
