1
EXHIBIT 10.39
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF
CAN BE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT OF 1933, AS
AMENDED, AND APPLICABLE STATE SECURITIES LAWS. THIS WARRANT AND SUCH SHARES OF
COMMON STOCK MAY NOT BE SOLD, TRANSFERRED, OR ASSIGNED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT, UNLESS, IN THE OPINION OF COUNSEL TO THE
COMPANY, SUCH REGISTRATION IS NOT THEN REQUIRED.
This Warrant will be void after January 16, 2001
WARRANT
To Purchase Shares of Common Stock of
UNIVERSAL SEISMIC ASSOCIATES, INC.
THIS CERTIFIES THAT, for value received, XXXXXX X. XXXX, whose address is
00000 Xxxx Xxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000-0000 (the "Holder"), is
entitled to purchase from UNIVERSAL SEISMIC ASSOCIATES, INC., a Delaware
corporation, whose address is 00000 Xxxx Xxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx
00000-0000 (the "Company"), at any time from and after the date hereof, and
prior to midnight (Houston, Texas time) on January 16, 2001 (the "Exercise
Period"), 15,000 fully paid and nonassessable shares of the Company's common
stock, $0.0001 par value (the "Common Stock"), at the price of $3.75 per Share
("Share Purchase Price"); subject, however, to the provisions and upon the
terms and conditions hereinafter set forth in this Warrant ("Warrant"). The
shares of Common Stock deliverable upon exercise of this Warrant shall be
referred to hereinafter collectively as the "Shares."
1. Exercise: Issuance of Certificates; Payment for Shares. The rights
represented by this Warrant may be exercised by the Holder, in whole or in
part, at any time or from time to time during the Exercise Period, upon
presentation and surrender of this Warrant to the Company, at its principal
office as set forth above, or at such other place as the Company may designate
written notice from the Holder stating that the Holder is exercising this
Warrant and specifying the number of Shares that the Holder desires to purchase
(the "Notice") and accompanied by payment of the applicable Share Purchase
Price for each Share so purchased and all federal and state taxes or other
governmental charge applicable to such exercise and issuance of the Shares.
Such payment shall be made, in cash or by certified, bank or cashier's check,
payable to the order of the Company. The Shares so purchased shall be deemed to
have been issued to the Holder as of the close of business on the business day
next following the date on which this Warrant shall have been surrendered to
the Company, along with the Notice and full payment for the Shares purchased.
Subject to the provisions of Section 8, certificates for the Shares so
purchased and, unless this Warrant shall have expired, a new Warrant
representing the number of Shares, if any, with respect to which this Warrant
shall not then have been exercised, shall be delivered to the Holder within a
reasonable time after the Holder has complied with the provisions of this
Section 1.
2. Restrictions on Exercise or Transfer of Warrant. The Holder may not
sell, assign, transfer or hypothecate this Warrant or any interest herein, and
any attempt by the Holder to do so
2
shall be void, Neither this Warrant nor any interest herein may be sold,
assigned, transferred or hypothecated involuntarily or by operation of law.
This Warrant and the Exercise Period shall automatically expire and terminate
immediately upon the Holder's death.
3. Reservation of Shares. The Company hereby agrees that at all times
during the Exercise Period there shall be reserved for issuance and delivery
upon exercise of this Warrant such number of Shares as shall be required for
issuance and delivery on exercise of this Warrant.
4. Loss of Warrant. The Company will execute and deliver a new Warrant of
like tenor and date upon receipt by the Company of evidence satisfactory to it
of the loss, theft, destruction or mutilation of this Warrant, and (i) in the
case of loss, theft or destruction, upon receipt by the Company of indemnity
satisfactory to the Company, or (ii) in the case of mutilation, upon
presentation, surrender, and cancellation of this Warrant. The Holder shall pay
all federal and state taxes or other governmental charge applicable to any
issuance of new Warrants under this Section 4.
5. Rights of the Holder. The Holder shall not, by virtue of this Warrant,
be entitled to any rights of a shareholder in the Company, either at law or
equity. The rights of the Holder are limited to those expressed in the Warrant
and are not enforceable against the Company except to the extent set forth
herein.
6. Adjustment and Other Events.
(a) Definition. As used in this Section 6, "Stock" shall mean
shares of the Company's capital stock of any class, whether now or hereafter
authorized, that has the right to participate in the distribution of earnings
and assets of the Company without limit as to amount or percentage. As of the
date hereof, Stock consists of 20,000,000 authorized shares of the Company's
common stock, $0.0001 par value per share.
(b) Stock Dividend or Distribution. If the Company shall declare
any dividend or other distribution upon its outstanding Stock payable in Stock,
or shall subdivide its outstanding shares of Stock into a greater number of
shares, then, on the effective date of such dividend, distribution or
subdivision, the number of Shares that may thereafter be purchased upon the
exercise of the rights represented hereby shall be increased in proportion to
the increase through such dividend, distribution or subdivision, and the Share
Purchase Price shall be decreased in such proportion. In case the Company shall
at any time combine the outstanding shares of its Stock into a smaller number
of shares, then, on the effective date of such combination, the number of
Shares that may thereafter be purchased upon the exercise of the rights
represented hereby shall be decreased in proportion to the decrease through
such combination, and the Share Purchase Price shall be increased in such
proportion.
(c) Notice of Adjustment and Other Events. The Company shall
give the Holder notice of any event requiring an adjustment as provided in
Subsection 6(b) at least ten days prior to the effective date of such event;
provided, however, that failure to give such notice shall not in any way
invalidate or otherwise limit or affect the validity or effectiveness of such
event.
- 2 -
3
(d) Fractional Shares. No fractional shares of Common Stock or
scrip representing fractional shares of Common Stock shall be issued upon the
exercise of this Warrant, and the Company shall have no obligation to make any
cash payment with respect thereto.
(e) Company-Held Stock. The number of shares of Stock of any
class at any time outstanding shall include all shares of Stock of that class
then owned or held by or for the account of the Company.
7. Registration Rights.
(a) In the event that the Company proposes, at any time during
the Exercise Period, to file a registration statement on a general form of
registration under the Securities Act of 1933, as amended (the "Securities
Act") and relating to shares of Common Stock issued or to be issued by it, then
it shall give written notice of such proposal to the Holder and to record
owners of any Shares issued hereunder, If, within 10 days after the giving of
such notice, the Holder or record owners of any Shares issued or issuable
hereunder shall request in writing that this Warrant or any portion of the
Shares be included in such proposed registration, the Company will, at its own
expense (except as set forth in Section 7(c) hereof), also register such
securities as shall have been so requested in writing; provided, however, that
the Holder and such owners shall cooperate with the Company in the preparation
of such registration statement to the extent required to furnish information
concerning the Holder and such owners as the Securities and Exchange Commission
or its rules and regulations may require.
(b) In connection with the filing of a registration statement
pursuant to Section 7(a) hereof, the Company shall:
(i) notify the Holder and such owners as to the
filing thereof and of all amendments thereto filed prior to the
effective date of said registration statement;
(ii) notify the Holder and such owners, promptly after
it shall have received notice thereof, of the time when the
registration statement becomes effective or any supplement to any
prospectus forming a part of the registration statement has been
filed;
(iii) prepare and file without expense to the Holder
and such owners any necessary amendment or supplement to such
registration statement or prospectus as may be necessary to comply
with Section 10(a)(3) of the Securities Act or advisable in
connection with the proposed distribution of the Shares by the Holder
or such owners; unless the provisions of Section 7(c) are applicable;
(iv) take all reasonable steps to qualify the Warrant
and the Shares being so registered for sale under the securities or
blue sky laws in such reasonable number of states as such registered
owners may designate in writing and to register or obtain the
approval of any federal or state authority which may be required in
connection with the proposed distribution, except, in each case, in
jurisdictions in which the Company must either qualify
- 3 -
4
to do business or file a general consent to service of process as a
condition to the qualification of such securities;
(v) notify the Holder and such owners of any stop
order suspending the effectiveness of the registration statement and
use its reasonable best efforts to remove such stop order;
(vi) undertake to keep said registration statement
and prospectus effective for a reasonable period of time; and
(vii) furnish to the Holder and such owners, as soon
as available, copies of any such registration statement and each
preliminary or final prospectus and any supplement or amendment
required to be prepared pursuant to the foregoing provisions of this
Section 7, all in such quantities as such owners may from time to
time reasonably request. Upon written request, the Company shall also
furnish to each owner, without cost, one set of the exhibits to such
registration statement.
(c) Limitations on Registration. If the Company gives notice
pursuant to this Section 7 for the purpose of permitting registration (whether
involving an underwritten or other offering) of Shares, the Company shall have
the right to determine the aggregate size of the offering and to limit the
number of shares to be registered at the request of Holder or any record owners
of Shares issued hereunder ("Registrable Stock") pursuant to Section 7(a),
including the right to exclude all shares to be to be registered at the request
of Holder or any record owners of Registrable Stock if the Company's
underwriters or financial advisers determine such exclusion is necessary or
advisable to insure a successful offering of the Company securities. If the
Company limits the number of (but does not exclude) such Shares, the maximum
number of shares to be registered on behalf of any holder of Registrable Stock
shall be determined by multiplying the number of shares of Registrable Stock
such holder has properly requested be registered by a fraction, the numerator
of which shall be the number of shares of Common Stock to be included in such
registration by all selling shareholders, and the denominator of which is the
number of shares of Common Stock validly requested to be included in such
registration by all holders of Common Stock having registration rights. All
registration rights with respect to any shares of Registrable Stock shall lapse
and terminate at the earlier of (i) such time as such shares have been actually
registered once on a registration statement on Form S-3 or S-8, (ii) such time
as the holder thereof has had the opportunity to register such shares hereunder
and has declined or failed to so register such shares, or (iii) such time as
counsel for the Company makes a good faith determination that all of the shares
of Registrable Stock may be sold into public markets under Rule 144 promulgated
under the Securities Act, or otherwise, in a period of nine months or less and
that any restrictive legend set forth on the shares of Registrable Shares
pertaining to securities law compliance may be removed. In addition, to the
extent that any existing registration rights of the Company conflict with the
provisions of this Section 7, the registration rights provided herein shall be
subject to any previously granted registration rights with respect to the
Company securities and shall be delayed or otherwise equitably subordinated to
such prior rights until such prior rights are satisfied.
- 4 -
5
(d) The Holder and the record owners of any Shares being
registered under this Section 7 agree to pay all of the underwriting discounts
and commissions and their own counsel fees with respect to the securities owned
by them and being registered.
(e) The Company agrees to use reasonable efforts to negotiate
and enter into a usual and customary appropriate cross-indemnity agreement with
any underwriter (as defined in the Securities Act) for the Holder and such
registered owners in connection with the filing of a registration statement
pursuant to Section 7 hereof.
(f) The Company agrees to use reasonable efforts to negotiate
and enter into a usual and customary appropriate cross-indemnity agreement with
the Holder and such registered owners.
(g) Notwithstanding the provisions of Section 7 hereof, if, at
the time of the pendency of any request of the registration of this Warrant or
Shares, such securities may be publicly sold by the holder thereof without
registration under the Securities Act pursuant to Rule 144 promulgated
thereunder or otherwise, such holder shall not be entitled to require the
Company to register such securities pursuant to the Securities Act.
8. Transfer to Comply with the, Securities Act of 1933. In addition
to the prohibitions and restrictions contained in Section 2 above, this Warrant
and any Shares issued or issuable upon exercise hereof may not be offered or
sold except in conformity with the Securities Act, and then only against
receipt of a written agreement of such person to whom such offer or sale is
made to comply with the provisions of this Section 8 with respect to any resale
or other disposition of such securities; except that no such agreement shall be
required from any person purchasing Shares issued or issuable upon exercise of
this Warrant pursuant to a registration statement effective under the
Securities Act. The Holder agrees that, prior to the disposition of any Shares
purchased pursuant to the exercise hereof under circumstances that might
require registration of such Shares under the Securities Act, or any similar
federal or state statute then in force, the Holder shall give written notice to
the Company expressing his intention as to the disposition to be made of such
Shares. Promptly upon receiving such notice, the Company shall present copies
thereof to its counsel. If, in the opinion of the Company's counsel, the
proposed disposition does not require registration of such Shares under the
Securities Act, or any similar federal or state statute then in force, the
Company shall, as promptly as practicable, notify the Holder of such opinion,
and the Holder shall then be entitled to dispose of such Shares, but only
strictly in accordance with the terms of the notice delivered by the Holder to
the Company and any qualifications or limitations contained in the opinion of
the Company's counsel.
9. Further Assurances. The Company will take all such action as
may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and nonassessable Shares upon the exercise of this
Warrant.
10. Reservation of Shares. The Company will at all times reserve and
keep available, solely for issuance and delivery upon the exercise of this
Warrant, all shares of Common Stock from time to time issuable upon the
exercise of this Warrant.
- 5 -
6
11. Applicable Law. This Warrant shall be governed by and construed
in accordance with the laws of the State of Texas.
12. Notice. Any notices or certificates by the Company to the Holder
or by the Holder to the Company shall be deemed delivered if in writing and
delivered personally or sent by registered or certified mail, return receipt
requested, to such party at the address set forth on page 1 of this Warrant, or
to such other address as the party may designate by notice given in accordance
with this Section 12.
13. Arbitration. Any and all disputes between the parties hereto
arising under or related to this Warrant shall be settled by binding
arbitration in Houston, Texas, under the Texas General Arbitration Act, and the
determination in any such arbitration may be entered in any court having
jurisdiction. The arbitration shall be conducted by a panel of three
arbitrators, one chosen by each party and the third by the two arbitrators so
chosen. If the two arbitrators cannot agree on a third, then the third shall be
appointed by the Presiding Judge of the United States District Court for the
Southern District of Texas--Houston Division, upon the application of either
party with notice to the other.
14. Descriptive Headings. The descriptive headings of the several
Sections of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant.
IN WITNESS WHEREOF, this Warrant has been executed and delivered to be
effective as of January 16, 1996.
UNIVERSAL SEISMIC ASSOCIATES, INC.,
a Delaware corporation
By: /s/ XXXXXXX X. XXXXXXX
-------------------------------------
Xxxxxxx X. Xxxxxxx, President
- 6 -
