Contract
Exhibit 10.35
THIS WARRANT AND ANY SECURITIES ACQUIRED UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAW OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS. THIS WARRANT AND SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH THE CONDITIONS SPECIFIED IN THIS WARRANT.
AssuranceAmerica Corporation
COMMON SHARE PURCHASE WARRANT
| No. W-1 | December 30, 2011 |
Warrant to Purchase 11,629,000 Common Shares
AssuranceAmerica Corporation, a Nevada corporation (the “Company”), for value received, hereby certifies that Xxx X. Xxxxxxx and Xxxxxxxx X. Xxxxxxx, individuals, or their registered assigns (the “Holder”), is entitled to purchase from the Company 11,629,000 shares of duly authorized, validly issued, fully paid and nonassessable common shares, $0.01 par value, of the Company (the “Common Shares”), at a purchase price equal to the Purchase Price (this “Warrant”), at any time or from time to time but prior to 5:00 P.M., New York City time, on December 30, 2015 (the “Expiration Date”), all subject to the terms, conditions and adjustments set forth below in this Warrant.
“BUSINESS DAY” shall mean any day other than a Saturday or a Sunday or any day on which national banks are authorized or required by law to close. Any reference to “days” (unless Business Days are specified) shall mean calendar days.
“COMMON SHARES” shall have the meaning assigned to it in the introduction to this Warrant, such term to include any stock into which such Common Shares shall have been changed or any stock resulting from any reclassification of such Common Shares, and all other stock of any class or classes (however designated) of the Company the holders of which have the right, without limitation as to amount, either to all or to a share of the balance of current dividends and liquidating dividends after the payment of dividends and distributions on any shares entitled to preference.
“COMPANY” shall have the meaning assigned to it in the introduction to this Warrant.
“EXCHANGE ACT” shall mean the Securities Exchange Act of 1934, as amended from time to time, and the rules and regulations thereunder, or any successor statute.
“EXPIRATION DATE” shall have the meaning assigned to it in the introduction to this Warrant.
“HOLDER” shall have the meaning assigned to it in the introduction to this Warrant.
“INITIAL HOLDER” shall mean Xxx X. Xxxxxxx and Xxxxxxxx X. Xxxxxxx.
“NASD” shall mean the National Association of Securities Dealers, Inc.
“OTHER SECURITIES” shall mean any stock (other than Common Shares) and other securities of the Company or any other Person (corporate or otherwise) which the holders of the Warrants at any time shall be
entitled to receive, or shall have received, upon the exercise of the Warrants, in lieu of or in addition to Common Shares, or which at any time shall be issuable or shall have been issued in exchange for or in replacement of Common Shares or Other Securities pursuant to Section 3 or otherwise.
“PERSON” shall mean any individual, firm, partnership, corporation, trust, joint venture, association, joint stock company, limited liability company, unincorporated organization or any other entity or organization, including a government or agency or political subdivision thereof, and shall include any successor (by merger or otherwise) of such entity.
“PURCHASE PRICE” shall mean $0.01 per share.
“RESTRICTED SECURITIES” shall mean (i) any Warrants bearing the applicable legend set forth in Section 7.1, (ii) any Common Shares (or Other Securities) issued or issuable upon the exercise of Warrants which are (or, upon issuance, will be) evidenced by a certificate or certificates bearing the applicable legend set forth in such Section, and (iii) any Common Shares (or Other Securities) issued subsequent to the exercise of any of the Warrants as a dividend or other distribution with respect to, or resulting from a subdivision of the outstanding Common Shares (or other Securities) into a greater number of shares by reclassification, stock splits or otherwise, or in exchange for or in replacement of the Common Shares (or Other Securities) issued upon such exercise, which are evidenced by a certificate or certificates bearing the applicable legend set forth in such Section.
“SECURITIES ACT” shall mean the Securities Act of 1933, as amended from time to time, and the rules and regulations thereunder, or any successor statute.
“WARRANT” shall have the meaning assigned to it in the introduction to this Warrant.
“WARRANT SHARES” means (a) the Common Shares issued or issuable upon exercise of this Warrant in accordance with Section 2, (b) all other securities or other property issued or issuable upon any such exercise or exchange in accordance with this Warrant and (c) any securities of the Company distributed with respect to the securities referred to in the preceding clauses (a) and (b).
2.1. MANNER OF EXERCISE; PAYMENT OF THE PURCHASE PRICE.
(a) This Warrant may be exercised by the Holder hereof, in whole or in part, at any time or from time to time prior to the Expiration Date, by surrendering to the Company at its principal office this Warrant, with a completed Election to Purchase Shares in the form attached hereto as Exhibit A (or a reasonable facsimile thereof) duly executed by the Holder and accompanied by payment of the Purchase Price for the number of Common Shares specified in such form (the “Aggregate Purchase Price”). Any partial exercise of this Warrant shall be for a whole number of Warrant Shares only.
(b) Payment of the Aggregate Purchase Price may be made in United States currency by cash or delivery of a certified check or bank draft payable to the order of the Company or by wire transfer to the Company.
2.3. DELIVERY OF STOCK CERTIFICATES, ETC.; CHARGES, TAXES AND EXPENSES.
(a) As soon as practicable after each exercise of this Warrant, in whole or in part, and in any
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event within five Business Days thereafter, the Company shall cause to be issued in the name of and delivered to the Holder hereof or, subject to Section 7, as the Holder may direct,
(i) a certificate or certificates for the whole number of Common Shares (or Other Securities) to which the Holder shall be entitled upon such exercise, and
(ii) in case such exercise is for less than all of the Common Shares purchasable under this Warrant, a new Warrant or Warrants of like tenor, for the balance of the Common Shares purchasable hereunder.
(b) Issuance of certificates for Common Shares upon the exercise of this Warrant shall be made without charge to the Initial Holder hereof for any issue or transfer tax or other incidental expense, in respect of the issuance of such certificates, all of which such taxes and expenses shall be paid by the Company; PROVIDED, HOWEVER, that the Company shall not be required to pay any tax that may be payable in respect of any issuance of any Warrant or any certificate for, or any other evidence of ownership of, Warrant Shares in a name other than that of the Initial Holder of this Warrant being exercised or exchanged.
3. CONSOLIDATION, MERGER, ETC.
3.1. ADJUSTMENTS FOR CONSOLIDATION, MERGER, SALE OF ASSETS,REORGANIZATION, ETC. In case the Company after the date hereof (a) shall consolidate with or merge into any other Person and shall not be the continuing or surviving corporation of such consolidation or merger, or (b) shall permit any other Person to consolidate with or merge into the Company and the Company shall be the continuing or surviving Person but, in connection with such consolidation or merger, the Common Shares shall be changed into or exchanged for stock or other securities of any other Person or cash or any other property, or (c) shall transfer all or substantially all of its properties or assets to any other Person, or (d) shall effect a capital reorganization or reclassification of the Common Shares, then, and in the case of each such transaction, the Holder of this Warrant shall be entitled to receive at and upon consummation of such transaction (but only upon payment of the aggregate Purchase Price in effect at the time of such consummation for all Common Shares issuable upon such exercise immediately prior to such consummation), the highest amount of securities, cash or other property to which such Holder would actually have been entitled as a shareholder upon such consummation if such Holder had exercised this Warrant immediately prior thereto; PROVIDED that if a purchase, tender or exchange offer shall have been made to and accepted by the holders of more than 50% of the outstanding Common Shares, and if the Holder so designates in a notice given to the Company on or before the date immediately preceding the date of the consummation of such transaction, the Holder of this Warrant shall be entitled to receive at and upon consummation of such purchase, tender or exchange offer (but only upon payment of the aggregate Purchase Price in effect at the time of expiration of such purchase, tender or exchange offer) the highest amount of securities, cash or other property to which it would actually have been entitled as a shareholder if the Holder of this Warrant had exercised this Warrant prior to the expiration of such purchase, tender or exchange offer and accepted such offer.
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“THIS WARRANT AND ANY SECURITIES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAW OF ANY STATE, AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS. THIS WARRANT AND SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH THE CONDITIONS SPECIFIED IN THIS WARRANT.
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Except as otherwise permitted by this Section 7, each certificate for Common Shares (or Other Securities) issued upon the exercise of any Warrant, and each certificate issued upon the transfer of any such Common Shares (or Other Securities), shall be stamped or otherwise imprinted with a legend in substantially the following form:
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAW OF ANY STATE, AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS. SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH THE CONDITIONS SPECIFIED IN THE AMENDED AND RESTATED COMMON SHARE PURCHASE WARRANT ISSUED BY FRONTSTEP, INC., A COMPLETE AND CORRECT COPY OF EACH OF WHICH IS AVAILABLE FOR INSPECTION AT THE COMPANY’S PRINCIPAL OFFICE AND WILL BE FURNISHED TO THE HOLDER OF SUCH SECURITIES UPON WRITTEN REQUEST AND WITHOUT CHARGE.”
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for such purpose. All Warrant Certificates surrendered upon the exercise of the rights thereby evidenced shall be canceled, and such canceled Warrants shall constitute sufficient evidence of the number of shares of stock which have been issued upon the exercise of such Warrants. Subsequent to the Expiration Date, no shares of stock need be reserved in respect of any unexercised Warrant.
9. REGISTRATION AND TRANSFER OF WARRANTS, ETC.
(i) such transferee is acquiring the Warrant hereunder for its own account, without a view to the distribution thereof;
(ii) such transferee is an “accredited investor” within the meaning of Regulation D under the Securities Act and was not organized for the specific purpose of acquiring the Warrant or the Warrant Shares;
(iii) such transferee has sufficient knowledge and experience in investing in companies similar to the Company so as to be able to evaluate the risks and merits of its investment in the transferee and is able financially to bear the risks thereof; and
(iv) if applicable, such transferee understands that (i) this Warrant and the Warrant Shares have not been registered under the Securities Act in reliance upon an exemption from the registration requirements of the Securities Act pursuant to Section 4(2) thereof or Rule 506 promulgated under such act and under applicable state securities laws, (ii) this Warrant and the Warrant Shares must be held indefinitely unless a subsequent disposition thereof is registered under the Securities Act and under applicable state securities laws or is exempt from such registration, (iii) this Warrant and the Warrant Shares will bear a legend to such effect, and (iv) the Company will make a notation on its transfer books to such effect.
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be entitled to seek to compel specific performance of the obligations of the Company under this Warrant, without the posting of any bond, in accordance with the terms and conditions of this Warrant in any court of the United States or any State thereof having jurisdiction, and if any action should be brought in equity to enforce any of the provisions of this Warrant, the Company shall not raise the defense that there is an adequate remedy at law. Except as otherwise provided by law, a delay or omission by the Holder hereto in exercising any right or remedy accruing upon any such breach shall not impair the right or remedy or constitute a waiver of or acquiescence in any such breach. No remedy shall be exclusive of any other remedy. All available remedies shall be cumulative.
| If to the Company: |
AssuranceAmerica Corporation | |
| 0000 Xxxxxxxxxx Xxxxx Xxxxxxx | ||
| Xxxxx 000 | ||
| Xxxxxxx, Xx. 00000 | ||
| If to Holder: |
Xxx X. Xxxxxxx and Xxxxxxxx X. Xxxxxxx | |
| 0000 Xxxxxxxxxx Xxxxx Xxxxxxx | ||
| Xxxxx 000 | ||
| Xxxxxxx, Xx. 00000 | ||
All such notices and communications (and deliveries) shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; when receipt is acknowledged, if telecopied; on the next Business Day, if timely delivered to a courier guaranteeing overnight delivery; and five days after being deposited in the mail, if sent first class or certified mail, return receipt requested, postage prepaid; PROVIDED, that the exercise of any Warrant shall be effective in the manner provided in Section 2.
15. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the law of the State of Nevada.
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18. This Warrant shall not be exercisable and shall be of no further effect if the Issuer sells all or substantially all of its assets in a transaction closed on or before June 30, 2012.
| AssuranceAmerica Corporation | ||||
| By: | /s/ [ILLEGIBLE] | |||
| Name: | ||||
| Title: | EVP |
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EXHIBIT A to COMMON SHARES PURCHASE WARRANT
FORM OF ELECTION TO PURCHASE SHARES
The undersigned hereby irrevocably elects to exercise the Warrant to purchase common shares, no par value (“Common Shares”), of [ISSUER] and hereby makes payment of $ therefor. The undersigned hereby requests that certificates for such shares be issued and delivered as follows:
| ISSUE TO: |
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| (NAME) | ||||||
| (ADDRESS, INCLUDING ZIP CODE) | ||||||
| (SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER) | ||||||
| DELIVER TO: |
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| (NAME) | ||||||
| (ADDRESS, INCLUDING ZIP CODE) | ||||||
If the number of Common Shares purchased (and/or reduced) hereby is less than the number of Common Shares covered by the Warrant, the undersigned requests that a new Warrant representing the number of Common Shares not so purchased (or reduced) be issued and delivered as follows:
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| ISSUE TO: |
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| (NAME OF HOLDER) | ||||||
| (ADDRESS, INCLUDING ZIP CODE) | ||||||
| DELIVER TO: |
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| (NAME OF HOLDER) | ||||||
| (ADDRESS, INCLUDING ZIP CODE) | ||||||
Dated: , 20
| [NAME OF HOLDER] | ||||
| By: | ||||
| Name: | ||||
| Title: |
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EXHIBIT B to COMMON SHARES PURCHASE WARRANT
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto the Assignee named below all of the rights of the undersigned to purchase Common Shares, no par value (“Common Shares”) of [ISSUER] represented by the Warrant, with respect to the number of Common Shares set forth below:
NAME OF ASSIGNEE ADDRESS NO. OF SHARES
and does hereby irrevocably constitute and appoint Attorney to make such transfer on the books of maintained for that purpose, with full power of substitution in the premises.
Dated: , 20 NAME OF HOLDER
| By: | ||||
| Name: | ||||
| Title: |
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