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Exhibit 4.2
WARRANT TO PURCHASE COMMON STOCK
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD
OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION STATEMENT
RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
SUCH ACT OR SUCH LAWS. THIS INSTRUMENT IS ISSUED SUBJECT TO THE
RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS OF A SECURITIES
PURCHASE AGREEMENT BETWEEN THE ISSUER OF THESE SECURITIES AND THE
INVESTOR REFERRED TO THEREIN, A COPY OF WHICH IS ON FILE WITH THE
ISSUER. THE SECURITIES REPRESENTED BY THIS INSTRUMENT MAY NOT
BE SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID
AGREEMENT. ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH SAID
AGREEMENT WILL BE VOID.
WARRANT
to purchase
37,360
Shares of Common Stock
of Santa Lucia Bancorp
Issue Date: December 19, 2008
1.
Definitions . Unless the context otherwise requires, when
used herein the following terms shall have the meanings
indicated.
"Affiliate" has the meaning ascribed to it in the
Purchase Agreement.
"Appraisal Procedure" means a procedure whereby two
independent appraisers, one chosen by the Company and one by the
Original Warrantholder, shall mutually agree upon the
determinations then the subject of appraisal. Each party shall
deliver a notice to the other appointing its appraiser within 15
days after the Appraisal Procedure is invoked. If within 30 days
after appointment of the two appraisers they are unable to agree
upon the amount in question, a third independent appraiser shall be
chosen within 10 days thereafter by the mutual consent of such
first two appraisers. The decision of the third appraiser so
appointed and chosen shall be given within 30 days after the
selection of such third appraiser. If three appraisers shall be
appointed and the determination of one appraiser is disparate from
the middle determination by more than twice the amount by which the
other determination is disparate from the middle determination,
then the determination of such appraiser shall be excluded, the
remaining two determinations shall be averaged and such average
shall be binding and conclusive upon the
Company and the Original Warrantholder; otherwise, the average
of all three determinations shall be binding upon the Company and
the Original Warrantholder. The costs of conducting any Appraisal
Procedure shall be borne by the Company.
"Board of Directors" means the board of directors of the
Company, including any duly authorized committee thereof.
"Business Combination" means a merger, consolidation, statutory
share exchange or similar transaction that requires the approval of
the Company’s stockholders.
"business day" means any day except Saturday, Sunday and any day
on which banking institutions in the State of New York generally
are authorized or required by law or other governmental actions to
close.
"Capital Stock" means (A) with respect to any Person that
is a corporation or company, any and all shares, interests,
participations or other equivalents (however designated) of capital
or capital stock of such Person and (B) with respect to any
Person that is not a corporation or company, any and all
partnership or other equity interests of such Person.
"Charter" means, with respect to any Person, its certificate or
articles of incorporation, articles of association, or similar
organizational document.
"Common Stock" has the meaning ascribed to it in the Purchase
Agreement.
"Company" means the Person whose name, corporate or other
organizational form and jurisdiction of organization is set forth
in Item 1 of Schedule A hereto.
"conversion" has the meaning set forth in
Section 13(B).
"convertible securities" has the meaning set forth in
Section 13(B).
"CPP" has the meaning ascribed to it in the Purchase
Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any successor statute, and the rules and
regulations promulgated thereunder.
"Exercise Price" means the amount set forth in Item 2 of
Schedule A hereto.
"Expiration Time" has the meaning set forth in
Section 3.
"Fair Market Value" means, with respect to any security or other
property, the fair market value of such security or other property
as determined by the Board of Directors, acting in good faith or,
with respect to Section 14, as determined by the Original
Warrantholder acting in good faith. For so long as the Original
Warrantholder holds this Warrant or any portion thereof, it may
object in writing to the Board of Director’s calculation of
fair market value within 10 days of receipt of written notice
thereof. If the Original Warrantholder and the Company are unable
to agree on fair market value during the 10-day period following
the delivery of the Original Warrantholder’s objection, the
Appraisal Procedure may be invoked by either party to
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determine Fair Market Value by delivering written notification
thereof not later than the 30 th day after delivery of
the Original Warrantholder’s objection.
"Governmental Entities" has the meaning ascribed to it in the
Purchase Agreement.
"Initial Number" has the meaning set forth in
Section 13(B).
"Issue Date" means the date set forth in Item 3 of Schedule A
hereto.
"Market Price" means, with respect to a particular security, on
any given day, the last reported sale price regular way or, in case
no such reported sale takes place on such day, the average of the
last closing bid and ask prices regular way, in either case on the
principal national securities exchange on which the applicable
securities are listed or admitted to trading, or if not listed or
admitted to trading on any national securities exchange, the
average of the closing bid and ask prices as furnished by two
members of the Financial Industry Regulatory Authority, Inc.
selected from time to time by the Company for that purpose. "Market
Price" shall be determined without reference to after hours or
extended hours trading. If such security is not listed and traded
in a manner that the quotations referred to above are available for
the period required hereunder, the Market Price per share of Common
Stock shall be deemed to be (i) in the event that any portion
of the Warrant is held by the Original Warrantholder, the fair
market value per share of such security as determined in good faith
by the Original Warrantholder or (ii) in all other
circumstances, the fair market value per share of such security as
determined in good faith by the Board of Directors in reliance on
an opinion of a nationally recognized independent investment
banking corporation retained by the Company for this purpose and
certified in a resolution to the Warrantholder. For the purposes of
determining the Market Price of the Common Stock on the "trading
day" preceding, on or following the occurrence of an event,
(i) that trading day shall be deemed to commence immediately
after the regular scheduled closing time of trading on the New York
Stock Exchange or, if trading is closed at an earlier time, such
earlier time and (ii) that trading day shall end at the next
regular scheduled closing time, or if trading is closed at an
earlier time, such earlier time (for the avoidance of doubt, and as
an example, if the Market Price is to be determined as of the last
trading day preceding a specified event and the closing time of
trading on a particular day is 4:00 p.m. and the specified
event occurs at 5:00 p.m. on that day, the Market Price would
be determined by reference to such 4:00 p.m. closing
price).
"Ordinary Cash Dividends" means a regular quarterly cash
dividend on shares of Common Stock out of surplus or net profits
legally available therefor (determined in accordance with generally
accepted accounting principles in effect from time to time),
provided that Ordinary Cash Dividends shall not include any
cash dividends paid subsequent to the Issue Date to the extent the
aggregate per share dividends paid on the outstanding Common Stock
in any quarter exceed the amount set forth in Item 4 of Schedule A
hereto, as adjusted for any stock split, stock dividend, reverse
stock split, reclassification or similar transaction.
"Original Warrantholder" means the United States Department of
the Treasury. Any actions specified to be taken by the Original
Warrantholder hereunder may only be taken by such Person and not by
any other Warrantholder.
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"Permitted Transactions" has the meaning set forth in
Section 13(B).
"Person" has the meaning given to it in
Section 3(a)(9) of the Exchange Act and as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act.
"Per Share Fair Market Value" has the meaning set forth in
Section 13(C).
"Preferred Shares" means the perpetual preferred stock issued to
the Original Warrantholder on the Issue Date pursuant to the
Purchase Agreement.
"Pro Rata Repurchases" means any purchase of shares of Common
Stock by the Company or any Affiliate thereof pursuant to
(A) any tender offer or exchange offer subject to
Section 13(e) or 14(e) of the Exchange Act or
Regulation 14E promulgated thereunder or (B) any other offer
available to substantially all holders of Common Stock, in the case
of both (A) or (B), whether for cash, shares of Capital Stock
of the Company, other securities of the Company, evidences of
indebtedness of the Company or any other Person or any other
property (including, without limitation, shares of Capital Stock,
other securities or evidences of indebtedness of a subsidiary), or
any combination thereof, effected while this Warrant is
outstanding. The "Effective Date" of a Pro Rata Repurchase
shall mean the date of acceptance of shares for purchase or
exchange by the Company under any tender or exchange offer which is
a Pro Rata Repurchase or the date of purchase with respect to any
Pro Rata Repurchase that is not a tender or exchange offer.
"Purchase Agreement" means the Securities Purchase Agreement -
Standard Terms incorporated into the Letter Agreement, dated as of
the date set forth in Item 5 of Schedule A hereto, as amended from
time to time, between the Company and the United States Department
of the Treasury (the "Letter Agreement"), including all
annexes and schedules thereto.
"Qualified Equity Offering" has the meaning ascribed to it in
the Purchase Agreement.
"Regulatory Approvals" with respect to the Warrantholder, means,
to the extent applicable and required to permit the Warrantholder
to exercise this Warrant for shares of Common Stock and to own such
Common Stock without the Warrantholder being in violation of
applicable law, rule or regulation, the receipt of any
necessary approvals and authorizations of, filings and
registrations with, notifications to, or expiration or termination
of any applicable waiting period under, the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, and the
rules and regulations thereunder.
"SEC" means the U.S. Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended,
or any successor statute, and the rules and regulations
promulgated thereunder.
"Shares" has the meaning set forth in Section 2.
"trading day" means (A) if the shares of Common Stock are
not traded on any national or regional securities exchange or
association or over-the-counter market, a business day or
(B) if the shares of Common Stock are traded on any national
or regional securities exchange or
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association or over-the-counter market, a business day on which
such relevant exchange or quotation system is scheduled to be open
for business and on which the shares of Common Stock (i) are
not suspended from trading on any national or regional securities
exchange or association or over-the-counter market for any period
or periods aggregating one half hour or longer; and (ii) have
traded at least once on the national or regional securities
exchange or association or over-the-counter market that is the
primary market for the trading of the shares of Common Stock.
"U.S. GAAP" means United States generally accepted accounting
principles.
"Warrantholder" has the meaning set forth in Section 2.
"Warrant" means this Warrant, issued pursuant to the Purchase
Agreement.
2.
Number of Shares; Exercise Price . This certifies that, for
value received, the United States Department of the Treasury or its
permitted assigns (the "Warrantholder") is entitled, upon
the terms and subject to the conditions hereinafter set forth, to
acquire from the Company, in whole or in part, after the receipt of
all applicable Regulatory Approvals, if any, up to an aggregate of
the number of fully paid and nonassessable shares of Common Stock
set forth in Item 6 of Schedule A hereto, at a purchase price per
share of Common Stock equal to the Exercise Price. The number of
shares of Common Stock (the "Shares") and the Exercise Price
are subject to adjustment as provided herein, and all references to
"Common Stock," "Shares" and "Exercise Price" herein shall be
deemed to include any such adjustment or series of adjustments.
3.
Exercise of Warrant; Term . Subject to Section 2, to
the extent permitted by applicable laws and regulations, the right
to purchase the Shares represented by this Warrant is exercisable,
in whole or in part by the Warrantholder, at any time or from time
to time after the execution and delivery of this Warrant by the
Company on the date hereof, but in no event later than
5:00 p.m., New York City time on the tenth anniversary of the
Issue Date (the "Expiration Time"), by (A) the
surrender of this Warrant and Notice of Exercise annexed hereto,
duly completed and executed on behalf of the Warrantholder, at the
principal executive office of the Company located at the address
set forth in Item 7 of Schedule A hereto (or such other office or
agency of the Company in the United States as it may designate by
notice in writing to the Warrantholder at the address of the
Warrantholder appearing on the books of the Company), and
(B) payment of the Exercise Price for the Shares thereby
purchased:
(i) by having the Company withhold, from the shares of
Common Stock that would otherwise be delivered to the Warrantholder
upon such exercise, shares of Common stock issuable upon exercise
of the Warrant equal in value to the aggregate Exercise Price as to
which this Warrant is so exercised based on the Market Price of the
Common Stock on the trading day on which this Warrant is exercised
and the Notice of Exercise is delivered to the Company pursuant to
this Section 3, or
(ii) with the consent of both the Company and the
Warrantholder, by tendering in cash, by certified or
cashier’s check payable to the order of the Company, or by
wire transfer of immediately available funds to an account
designated by the Company.
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If the Warrantholder does not exercise this Warrant in its
entirety, the Warrantholder will be entitled to receive from the
Company within a reasonable time, and in any event not exceeding
three business days, a new warrant in substantially identical form
for the purchase of that number of Shares equal to the difference
between the number of Shares subject to this Warrant and the number
of Shares as to which this Warrant is so exercised. Notwithstanding
anything in this Warrant to the contrary, the Warrantholder hereby
acknowledges and agrees that its exercise of this Warrant for
Shares is subject to the condition that the Warrantholder will have
first received any applicable Regulatory Approvals.
4.
Issuance of Shares; Authorization; Listing . Certificates
for Shares issued upon exercise of this Warrant will be issued in
such name or names as the Warrantholder may designate and will be
delivered to such named Person or Persons within a reasonable time,
not to exceed three business days after the date on which this
Warrant has been duly exercised in accordance with the terms of
this Warrant. The Company hereby represents and warrants that any
Shares issued upon the exercise of this Warrant in accordance with
the provisions of Section 3 will be duly and validly authorized and
issued, fully paid and nonassessable and free from all taxes, liens
and charges (other than liens or charges created by the
Warrantholder, income and franchise taxes incurred in connection
with the exercise of the Warrant or taxes in respect of any
transfer occurring contemporaneously therewith). The Company agrees
that the Shares so issued will be deemed to have been issued to the
Warrantholder as of the close of business on the date on which this
Warrant and payment of the Exercise Price are delivered to the
Company in accordance with the terms of this Warrant,
notwithstanding that the stock transfer books of the Company may
then be closed or certificates representing such Shares may not be
actually delivered on such date. The Company will at all times
reserve and keep available, out of its authorized but unissued
Common Stock, solely for the purpose of providing for the exercise
of this Warrant, the aggregate number of shares of Common Stock
then issuable upon exercise of this Warrant at any time. The
Company will (A) procure, at its sole expense, the listing of
the Shares issuable upon exercise of this Warrant at any time,
subject to issuance or notice of issuance, on all principal stock
exchanges on which the Common Stock is then listed or traded and
(B) maintain such listings of such Shares at all times after
issuance. The Company will use reasonable best efforts to ensure
that the Shares may be issued without violation of any applicable
law or regulation or of any requirement of any securities exchange
on which the Shares are listed or traded.
5.
No Fractional Shares or Scrip . No fractional Shares or
scrip representing fractional Shares shall be issued upon any
exercise of this Warrant. In lieu of any fractional Share to which
the Warrantholder would otherwise be entitled, the Warrantholder
shall be entitled to receive a cash payment equal to the Market
Price of the Common Stock on the last trading day preceding the
date of exercise less the pro-rated Exercise Price for such
fractional share.
6.
No Rights as Stockholders; Transfer Books . This Warrant
does not entitle the Warrantholder to any voting rights or other
rights as a stockholder of the Company prior to the date of
exercise hereof. The Company will at no time close its transfer
books against transfer of this Warrant in any manner which
interferes with the timely exercise of this Warrant.
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7.
Charges, Taxes and Expenses . Issuance of certificates for
Shares to the Warrantholder upon the exercise of this Warrant shall
be made without charge to the Warrantholder for any issue or
transfer tax or other incidental expense in respect of the issuance
of such certificates, all of which taxes and expenses shall be paid
by the Company.
8.
Transfer/Assignment .
(A)
Subject to compliance with clause (B) of this Section 8,
this Warrant and all rights hereunder are transferable, in whole or
in part, upon the books of the Company by the registered holder
hereof in person or by duly authorized attorney, and a new warrant
shall be made and delivered by the Company, of the same tenor and
date as this Warrant but registered in the name of one or more
transferees, upon surrender of this Warrant, duly endorsed, to the
office or agency of the C
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