Exhibit 10.4
SECOND AMENDMENT TO
SECURITIES PURCHASE AGREEMENT
This Second Amendment to Securities Purchase Agreement (this
"AMENDMENT") is made and entered into as of the 28th day of February, 2005 by
and among Amen Properties, Inc. (the "COMPANY") and the purchasers named on the
signature pages attached hereto (the "PURCHASERS"), with reference to the
following facts:
A. The Company and the Purchasers entered into that certain Securities
Purchase Agreement dated as of January 18, 2005, as amended by that certain
First Amendment to Securities Purchase Agreement dated as of January 28, 2005
(collectively, the "PURCHASE AGREEMENT"). Capitalized terms used but not defined
herein shall have the meanings assigned thereto in the Purchase Agreement.
B. Three of the Purchasers, Xxxx Xxxxxx, Xxx X. Xxxxxx and Xxxxx
Xxxxxxxxx (collectively, the "INSIDE PURCHASERS"), are officers and/or directors
of the Company.
C. The parties have been advised by the Nasdaq Stock Market ("NASDAQ")
that under recent interpretations of the Nasdaq Marketplace Rules (the "NASDAQ
RULES"), the Inside Purchasers cannot acquire shares of Common Stock upon
conversion of the Series C Preferred or exercise of the Warrants without the
prior approval of the stockholders of the Company, and the Company and the
Purchasers have agreed to amend the Purchase Agreement as provided herein in
order to satisfy such Nasdaq Rules. Such stockholder approval is in addition to
the approval under other Nasdaq Rules provided in Section 5.10 of the Purchase
Agreement.
D. Nasdaq has also advised the parties that under Nasdaq Rules, the
voting rights of the Series C Preferred cannot be based upon the below market
conversion price currently set forth in the Certificate of Designation.
E. Pursuant to the Purchase Agreement, the Closing Date is set at
February 28, 2005. The parties acknowledge that there are delays in preparation
for Closing, and have determined and agreed that the Closing Date should be
extended as provided herein.
F. The parties have also agreed to make a clarifying amendment to
Section 2.2 of the Purchase Agreement as provided herein.
NOW, THEREFORE, FOR AND IN CONSIDERATION of the mutual promises,
covenants and agreements set forth in the Purchase Agreement and this Amendment,
the parties hereto agree as follows:
1. ADDITION OF SECTION 5.11 TO THE PURCHASE AGREEMENT. The Purchase Agreement is
hereby amended by adding Section 5.11 as follows:
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"SECTION 5.11 - ADDITIONAL STOCKHOLDER APPROVAL.
(a) In addition to the stockholder approval
required under Section 5.10, the parties further
acknowledge that the rules of the Nasdaq Stock Market
require the approval of the stockholders of the
Company with respect to the issuance of shares of
Common Stock to any Purchasers who are officers,
directors, employees or consultants of the Company
(the "INSIDE PURCHASERS") upon the conversion or
exercise of the Purchased Securities. Accordingly,
each of the Inside Purchasers hereby agrees not to
convert or exercise any of the Purchased Securities
acquired by such Inside Purchaser unless and until
such issuance is approved by the stockholders of the
Company in accordance with the rules of the Nasdaq
Stock Market. The Company agrees to solicit such
stockholder approval in connection with its next
stockholders meeting. Each of the Purchasers hereby
agrees to vote any and all securities of the Company
owned by such Purchaser and entitled to vote on the
issue in favor of the issuance of Common Stock to the
Inside Purchasers upon conversion or exercise of the
Purchased Securities. The Inside Purchasers
acknowledge and agree that if such stockholder
approval is not obtained, they will not be entitled
to acquire any of the Conversion Shares or any of the
Warrant Shares which will adversely effect the value
of the Securities they are purchasing under
hereunder. All of the Purchasers acknowledge and
agree that the Series C Preferred Stock will not be
entitled to vote in connection with the foregoing
stockholder approval.
(b) In the event stockholder approval under
this Section 5.11 is not obtained at the Company's
next stockholders meeting, the Company and the Inside
Purchasers agree that they will exchange the Series C
Preferred and Warrants purchased hereunder by the
Inside Purchasers for a new series of preferred stock
(the "NEW PREFERRED") and new common stock purchase
warrants (the "NEW WARRANTS"), the terms of which
will be identical to the Series C Preferred and the
Warrants except that the conversion ratio for the New
Preferred will be based upon a price per share of
$4.25 instead of $4.00 under the Series C Preferred
and the exercise price per share of the New Warrants
will be $4.25 instead of $4.00 for the Warrants. The
parties acknowledge and agree that $4.25 per share is
in excess of the last bid price per share for the
Common Stock on the Nasdaq Stock Market the last
business day before the Purchase Agreement was first
signed. The Inside Purchasers shall not receive any
benefit in such exchange which is not also received
by the other Purchasers pursuant to the terms of this
Agreement and the terms of the Securities. Without
limiting the generality of the preceding sentence,
the Inside Purchasers acknowledge and agree that if
the Stockholder Approval under Section 5.10 is not
obtained, the New Preferred and New Warrants will be
subject to and restricted by the Common Stock Cap in
the same manner as the Series C Preferred and the
Warrants."
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2. AMENDMENT OF SECTION 2.2 OF THE PURCHASE AGREEMENT. Section 2.2 of
the Purchase Agreement is hereby amended by deleting the words "Effective as of"
at the beginning of the last sentence and replacing them with "On or before."
3. REVISION OF CERTIFICATE OF DESIGNATION.
(i) Section 4(a) of the Certificate of Designation is hereby
deleted in its entirety and replaced by the following:
(a) Each holder of outstanding shares of Series C
Preferred Stock shall be entitled to the number of votes equal
to the number of whole shares of Common Stock into which all
of the shares of Series C Preferred Stock held by such holder
would be convertible if the Conversion Price were $4.25 per
share of Common Stock (subject to the Conversion Cap described
in Section 6(1) hereof and as adjusted from time to time
pursuant to Sections 6(e), (f), (g) and (h) hereof) at each
meeting of stockholders of the Company (and written actions of
stockholders in lieu of meetings) with respect to any and all
matters presented to the stockholders of the Company for their
action or consideration. The foregoing calculation of voting
rights shall not have any effect on the Conversion Rights set
forth in Section 6 hereof. Except as provided by law, by the
express provisions hereof, or by the provisions establishing
any other series of Preferred Stock, holders of Series C
Preferred Stock and of any outstanding other series of
Preferred Stock shall vote together with the holders of Common
Stock as a single class.
(ii) Section 6(d)(ii) of the Certificate of Designation is
hereby amended to insert the "(A)" before the word "unless" instead of
after such word, and to insert the word "if," immediately after the
"(B)".
4. EXTENSION OF CLOSING DATE. The Purchase Agreement is hereby amended
to change the Closing Date from February 28, 2005 to the following: "March 31,
2005 or such earlier time as the Company has received all documents and other
items necessary for Closing and all conditions to Closing have been satisfied or
at such other time as the parties mutually agree."
5. RATIFICATION OF PURCHASE AGREEMENT, AS AMENDED. Except as expressly
modified herein, the Purchase Agreement shall remain unchanged and, as amended
hereby, in full force and effect. The parties hereto hereby acknowledge, ratify
and confirm the Purchase Agreement, as amended hereby, and agree to perform
their obligations thereunder.
6. COUNTERPARTS. This Amendment may be executed in any number of
counterparts so long as each party hereto executes at least one such
counterpart, and all such counterparts shall be taken together as one document.
Faxed signatures shall be considered and deemed original signatures for all
purposes.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered as of the date first above written.
THE COMPANY:
AMEN PROPERTIES, INC.
By: /s/ Xxx X. Xxxxxx
--------------------------------
Xxx X. Xxxxxx, President
THE PURCHASERS:
/s/ Xxx X. Xxxxxx
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Xxx X. Xxxxxx
/s/ Xxxx Xxxxxx
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Xxxx Xxxxxx
MORIAH INVESTMENT PARTNERS
By:
--------------------------------
Name:
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Title:
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McGRAW BROTHER INVESTMENTS
By:
--------------------------------
Name:
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Title:
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/s/ Frosty Xxxxxxx
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Frosty Xxxxxxx
/s/ Xxxx Xxxxxxx
-------------------------------------
Xxxx Xxxxxxx
/s/ Xxxx Xxxxxxx
-------------------------------------
Xxxx Xxxxxxx
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LCM PARTNERSHIP, LP
By:
--------------------------------
its general partner
By:
--------------------------------
Name:
------------------------------
Title:
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JMA CHEDDARS, LTD.
By:
--------------------------------
its general partner
By:
--------------------------------
Name:
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Title:
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/s/ Xxxxx Xxxxxxxxx
------------------------------------
Xxxxx Xxxxxxxxx
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