Exhibit 4.17
NEITHER THE STOCK PURCHASE WARRANT NOR THE COMMON STOCK ISSUABLE UPON EXERCISE
OF THE STOCK PURCHASE WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR UNDER ANY STATE SECURITIES ACT AND CANNOT BE SOLD,
TRANSFERRED, OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER SUCH ACTS OR
UNLESS EXEMPTIONS FROM REGISTRATION ARE AVAILABLE.
STOCK PURCHASE WARRANT
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This Warrant is issued this 1/st/ day of March, 1998, by MASTER GRAPHICS,
INC., a Delaware corporation (the "Company") and XXXX X. XXXXXX ("Shareholder"),
to H. XXXXX XXXXXXXX (H. Xxxxx Xxxxxxxx and any subsequent assignee or
transferee hereof is hereinafter referred to as "Holder").
AGREEMENT:
1. ISSUANCE OF WARRANT; TERM. In the event that (a) Company or any of
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Company's successors or assigns (an "Affiliated Entity") shall cause to be made
or shall be involved in a public offering of its stock (an "IPO") within ten
(10) years from the date hereof, and (b) there has been no acquisition or merger
of the Company prior to the time of the IPO as described in Paragraph 7
hereunder, Holder shall have the right to acquire from the Company Common Stock
of the Company at a price equal to the IPO price, with the maximum number of
shares which Holder shall have the right to purchase to be determined as
follows:
$9,604 divided by Initial IPO Price Per Share = Maximum Number of Option
Shares
The shares of Common Stock issuable upon exercise of this Warrant are
hereinafter referred to as the "Shares." The option described pursuant to this
Paragraph 1 shall only be exercisable during the ten (10) year period commencing
with the date of the successful completion of the IPO (the "Exercise Period").
The exercise of, or the failure to exercise, this Warrant during the Exercise
Period shall terminate all other rights of Holder hereunder.
2. EXERCISE PRICE. The exercise price (the "Exercise Price") per
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Share for which all or any of the Shares may be purchased pursuant to the terms
of this Warrant shall be the IPO price.
3. EXERCISE. Prior to the exercise of all or any part of this Warrant,
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Holder shall give thirty (30) days prior written notice ("Holder Notice") of his
intent to exercise to the Company at 0000 Xxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxx
00000, or such other address as the Company shall designate in a written notice
to the Holder hereof. Within five (5) days after receipt of such notice, the
Company shall deliver to Holder: any Prospectus used by the Company during the
year in which the Holder Notice is received, together with all supplemental
information required to insure that such prospectus does not omit to state or
misstate a material fact; its Annual Reports on Form 10-K, if any, for the
Company's most recently completed fiscal year; all Quarterly Reports on Form 10-
Q, if any, filed by the Company during its current fiscal year; and all Current
Reports on Form 8-K, if any, filed by the Company during its current fiscal
year. Holder shall have until the thirtieth (30/th/) day
from the date of the Holder Notice to rescind such notice. If Holder does not
elect to rescind the Holder Notice, then on or within five (5) days after such
thirtieth (30/th/) day, Holder shall deliver to Company (the "Exercise
Delivery"): (i) this Warrant, (ii) a signed statement indicating the number of
Shares to be purchased, and (iii) either (A) a certified check in the amount of
the Exercise Price or (B) that certain promissory note dated of even date
herewith in the original principal amount of __________________ between the
Company and Holder, along with a signed statement directing the Company to
cancel that portion of such promissory note which is equal to the Exercise
Price. Upon receipt of the Exercise Delivery, the Company shall as promptly as
practicable, and in any event within fifteen (15) days thereafter, execute and
deliver, or cause to be executed and delivered to Holder a certificate or
certificates for the total number of whole Shares for which this Warrant is
being exercised. If this Warrant is exercised with respect to less than all of
the Shares, (i) the Company shall issue a new warrant for the remaining shares
covered by this Warrant and (ii) if the Promissory Note is used to fund the
Exercise Price, the Company shall issue a replacement promissory note with an
appropriate adjustment to the principal amount.
4. COVENANTS AND CONDITIONS. The above provisions are subject to the
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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 sold 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. Transfer of the Shares issued upon the exercise
of this Warrant shall be restricted in the same manner and to the same
extent as the Warrant and the certificates representing such Shares shall
bear substantially the following legend:
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"), OR ANY APPLICABLE STATE SECURITIES
LAW AND MAY NOT BE TRANSFERRED UNTIL (I) A REGISTRATION
STATEMENT UNDER THE ACT AND 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 AND 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 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, 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 Common Stock as will be
sufficient to permit the exercise in full of this Warrant.
5. TRANSFER OF WARRANT. Subject to the provisions of Section 4 hereof,
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this Warrant may only be transferred, in whole or in part, to a spouse or lineal
descendent of the original holder hereof or to a trust or other entity owned by
or directly benefitting the original holder hereof, his spouse or a lineal
descendant. Transfer in accordance with this Section 5 must be made by
presentation of the 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 Holder shall pay all expenses incurred by the Company in
connection with the preparation, issuance and delivery of Warrants under this
Section.
6. WARRANT HOLDER NOT SHAREHOLDER. Except as otherwise provided herein,
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this Warrant does not confer upon the Holder, as such, any right whatsoever as a
shareholder of the Company.
7. RIGHTS UPON SALE OR MERGER.
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(a) Shareholder shall not enter into any transaction that would result
in the merger or acquisition of the Company unless prior to such sale such
Shareholder shall give notice to Holder of its intention to effect such
sale in order that Holder may exercise its rights under this Section 7 as
hereinafter described. Such notice shall set forth the principal terms of
the merger of acquisition.
(b) In the event of any acquisition or merger of Company or an
Affiliated Entity, pursuant to which the Shareholder receives shares of
stock of any company (the "Surviving Entity") during the ten year period
commencing with the date hereof, Holder shall have the option to acquire
from Shareholder for a purchase price per share equal to the price per
share determined in connection with such acquisition or merger, a maximum
number of shares up to that number pursuant to which the purchase price
would equal $9,604, with the maximum number of shares which Holder shall
have the option to purchase to be determined as follows:
$9,604 divided by Price Per Share of Acquiring Entity = Maximum Number of
Option Shares
(c) The option described in this Section 7 shall only be exercisable
within ten (10) years from the date of a merger or acquisition, provided
there has been no IPO prior to the time of the merger or acquisition. The
exercise of, or the failure to exercise, this Warrant in conjunction with
an acquisition or merger of the Company or an Affiliated Entity shall
terminate all other rights of Holder hereunder.
8. ANTI-DILUTION PROVISIONS.
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(a) If the Company shall at any time subdivide its outstanding shares of
Common Stock (or other securities at the time receivable upon the exercise of
the Warrant) by recapitalization, reclassification or split-up thereof, or if
the Company shall declare a stock dividend or distribute shares of Common Stock
subject to this Warrant immediately prior to such subdivision shall be
proportionately increased, and if the Company shall at any time combine the
outstanding shares of Common Stock by recapitalization, reclassification or
combination thereof, the number of shares of Common stock subject to this
Warrant immediately prior to such combination shall be proportionately
decreased. Any such adjustment and adjustment to the Exercise Price pursuant to
this Section shall be effective at the close of business on the effective date
of such subdivision or combination or if any adjustment is the result of a stock
dividend or distribution then the effective date for such adjustment based
thereon shall be the record date therefor.
(b) Whenever the number of shares of Common stock purchasable upon the
exercise of this Warrant is adjusted, as provided in this Section, the Exercise
Price shall be adjusted to the nearest cent by multiplying such Exercise Price
immediately prior to such adjudstment by a fraction (x) the numerator of which
shall be the number of shares of Common Stock purchasable upon the exercise
immediately prior to such adjustment, and (y) the denominator of which shall be
the number of shares of Common Stock so purchasable immediately thereafter.
9. ARTICLE AND SECTION HEADINGS. Numbered and titled article and
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section headings are for convenience only and shall not be construed as
amplifying or limiting any of the provisions of this Warrant.
10. NOTICE. Any and all notices, elections or demands permitted or
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required to be made under this Warrant shall be in writing, signed by the party
giving such notice, election or demand and shall be delivered personally,
telecopied, telexed, or sent by certified mail or overnight via nationally
recognized courier service (such as Federal Express), to the other party at the
address set forth below, or at such other address as may be supplied in writing
and of which receipt has been acknowledged in writing. The date of personal
delivery or telecopy or two (2) business days after the date of mailing (or the
next business day after delivery or telecopy or two (2) business days after the
date of mailing (or the next business day after delivery to such courier
service), as the case may be, shall be the date of such notice, election or
demand. For the purpose of this Warrant:
The Address of Holder is: H. Xxxxx Xxxxxxxx
000 Xxxxx Xxxx
P. O. Xxx 0000
Xxxxxxxxx, Xxxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
with a copy to: Butler, Snow, O'Mara, Xxxxxxx & Xxxxxxx
00/xx/ Xxxxx
Xxxxxxx Xxxxxxxx Xxxxx
000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxx Xxxxxxx, Esq.
The Address of Company is: Master Printing Holding Co.
0000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxx
with a copy to: Black Bobango & Xxxxxx
000 Xxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
11. SEVERABILITY. If any provisions(s) of this Warrant or the application
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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 bylaw.
12. ENTIRE AGREEMENT. This Warrant between the Company and Holder
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represents the entire agreement between the parties concerning the subject
matter hereof, and all oral discussions and prior agreement are merged herein.
13. GOVERNING LAW AND AMENDMENTS. This Warrant shall be construed and
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enforced under the laws of the State of Mississippi applicable to contracts to
be wholly performed in such State. No amendment or modification hereof shall be
effective except in a writing executed by each of the parties hereto.
14. COUNTERPARTS. This Warrant may be executed in any number of
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counterparts and be 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.
15. JURISDICTION AND VENUE. The Company hereby consents to the
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jurisdiction of the courts of the State of Tennessee and the State of
Mississippi and the United States District Court for the Western District of
Tennessee and the Southern District of Mississippi, as well as to the
jurisdiction of all courts from which an appeal may be taken from such courts,
for the purpose of any suit, action or other proceeding arising out of any of
its obligations arising under this Agreement or with respect to the transactions
contemplated hereby, and expressly waives any and all objections it may have as
to venue in any of such courts.
IN WITNESS WHEREOF, the parties hereto have set their hands as of the date
first above written.
COMPANY: MASTER GRAPHICS, INC.,
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a Delaware corporation
By: /s/ Xxxx X. Xxxxxx
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Title: President
HOLDER: /s/ H. Xxxxx Xxxxxxxx
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H. Xxxxx Xxxxxxxx
IN WITNESS WHEREOF, the undersigned has executed or caused this Warrant to
be executed as of the date first above written for the purpose of agreeing only
to the terms and conditions of Section 7 hereof.
SHAREHOLDER: /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
