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EXHIBIT
10.1
THIS
WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT AN
EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR PURSUANT TO
RULE 144 OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
THE CORPORATION AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT
REQUIRED.
WARRANT
TO PURCHASE STOCK
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Corporation:
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Anasazi
Capital Corp., a Florida corporation
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Number
of Shares:
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262,800
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Class
of Stock:
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Common
Stock, no par value
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Exercise
Price:
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$0.01
per share
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Issue
Date:
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August
14, 2007
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Expiration
Date:
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August
13, 2012
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THIS
WARRANT CERTIFIES THAT, for good and valuable consideration,
the receipt of which is hereby acknowledged, Law Offices of
Michael H. Hoffman, P.A., or its permitted assignee
(“Holder”), is entitled to purchase the number of
fully paid and nonassessable shares of the class of securities
(the “Shares”) of the corporation (the
“Company”) at the exercise price (the
“Warrant Price”) all as set forth above and as
adjusted pursuant to Article 2 of this warrant, subject to the
provisions and upon the terms and conditions set forth in this
warrant.
ARTICLE 1. EXERCISE .
1.1
Method of Exercise . Upon the quotation of the
Company’s shares of common stock on a Public Market (as
defined in Section 1.5 ), Holder may exercise this warrant,
in whole or in part, by delivering this warrant and a duly executed
Notice of Exercise in substantially the form attached as
Appendix 1 to the principal office of the
Company. Unless Holder is exercising the conversion
right set forth in Section 1.2 , Holder shall also deliver
to the Company a check for the Warrant Price for the Shares being
purchased.
1.2
Conversion Right . Upon the quotation of the
Company’s shares of common stock on a Public Market (as
defined in Section 1.5 ), in lieu of exercising this warrant
as specified in Section 1.1 , Holder may from time to time
convert this warrant, in whole or in part, into a number of Shares
determined by multiplying the number of shares issuable upon
exercise of this warrant by a fraction, (a) the numerator of which
is the fair market value of one Share minus the Warrant Price of
one Share, by (b) the fair market value of one
Share. The fair market value of the Shares shall be the
closing price of the Shares (or the closing price of the
Company’s stock into which the Shares are convertible)
reported for the business day immediately before Holder delivers
its Notice of Exercise to the Company.
1.3
Delivery of Certificate and New Warrant
. Promptly after Holder exercises or converts this
warrant, the Company shall deliver to Holder certificates for the
Shares acquired and, if this warrant has not been fully exercised
or converted and has not expired, a new warrant representing the
Shares not so acquired.
1.4
Replacement of Warrants . On receipt of evidence
reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this warrant and, in the case of loss,
theft or destruction, on delivery of an indemnity agreement
reasonably satisfactory in form and amount to the Company or, in
the case of mutilation, on surrender and cancellation of this
warrant, the Company at its expense shall execute and deliver, in
lieu of this warrant, a new warrant of like tenor.
1.5
Put Right . In the event that the Company’s
shares of common stock are not listed for quotation on a recognized
national securities exchange, the Nasdaq National Market (or a
similar national quotation system), the over-the-counter electronic
bulletin board or the Pink Sheets (each, a “Public
Market”), at Holder’s option, in lieu of exercising its
rights as set forth in Section 1.1 or Section 1.2 ,
Holder shall have the right to require the Company to purchase this
warrant, or the Shares issuable upon the exercise of this warrant
(the “ Put Right ”), for an aggregate purchase
price equal to the number of Shares issued and issuable upon
exercise of this warrant multiplied by Equity Value (the “
Put Price ”). The Company shall pay the
purchase price to the Holder within seven (7) days after receipt of
Holder’s written notice of Holder’s decision to
exercise the Put Right; provided , that in the event that
Holder’s notice is provided less than seven (7) days prior to
the closing of an Acquisition, the Company shall make the payment
of the Put Price to the Holder on the day before the date of the
closing of the Acquisition. “Equity
Value” per Share shall be determined by dividing (a) the
excess of the Enterprise Value over Funded Debt, by (b) the
aggregate number of issued and outstanding shares of Common Stock
of the Company on a fully-diluted basis. For purposes of
this Section 1.3, the following terms shall have the following
meanings:
1.5.1 “Adjusted
Net Income” shall mean net income of the Company for
any period, excluding any non-recurring or extraordinary
gains and losses occurring in such period, but normalized for
historical uncollectible debt expenses.
1.5.2 “EBITDA”
shall mean Adjusted Net Income of the Company plus interest,
tax, depreciation and amortization expenses for a twelve (12)
month trailing period.
1.5.3 “Enterprise
Value” shall mean the Company’s EBITDA multiplied
times seven (7).
1.5.4 “Funded
Debt” shall mean all indebtedness obligations of the
Company except trade payables incurred by the Company
in the ordinary course of business.
1.6
Effect of Sale, Merger, or Consolidation of the Company
.
1.6.1
“Acquisition.” For the purpose of
this warrant, “Acquisition” means any sale, license, or
other disposition of all or substantially all of the assets
(including intellectual property) of the Company, or any
reorganization, consolidation, or merger of the Company where the
holders of the Company’s securities before the transaction
beneficially own less than 50% of the outstanding voting securities
of the surviving entity after the transaction.
1.6.2
Assumption of Warrant . If upon the closing of
any Acquisition the successor entity assumes the obligations of
this warrant, then this warrant shall be exercisable for the same
securities, cash, and property as would be payable for the Shares
issuable upon exercise of the unexercised portion of this warrant
as if such Shares were outstanding on the record date for the
Acquisition and subsequent closing. The Warrant Price
shall be adjusted accordingly. The Company shall use
reasonable efforts to cause the surviving corporation to assume the
obligations of this warrant.
1.6.3
Nonassumption . If upon the closing of any
Acquisition the successor entity does not assume the obligations of
this warrant, and Holder has not otherwise exercised this warrant
in full, then Holder shall have the right to deem this warrant to
have been automatically converted pursuant to Section 1.2
and thereafter Holder shall participate in the Acquisition on the
same terms as other holders of the same class of securities of the
Company.
ARTICLE 2. ADJUSTMENTS TO THE SHARES .
2.1
Reclassification, Exchange or Substitution . Upon
any reclassification, exchange, substitution, or other event that
results in a change of the number and/or class of the securities
issuable upon exercise or conversion of this warrant, Holder shall
be entitled to receive, upon exercise or conversion of this
warrant, the number and kind of securities and property that Holder
would have received for the Shares if this warrant had been
exercised immediately before such reclassification, exchange,
substitution, or other event. The Company or its
successor shall promptly issue to Holder a new warrant for such new
securities or other property. The new warrant shall
provide for adjustments which shall be as nearly equivalent as may
be practicable to the adjustments provided for in this Article 2
including, without limitation, adjustments to the Warrant Price and
to the number of securities or property issuable upon exercise of
the new warrant. The provisions of this Section
2.1 shall similarly apply to successive reclassifications,
exchanges, substitutions, or other events.
2.2
Adjustments for Combinations, Etc. If the
outstanding Shares are combined or consolidated, by
reclassification or otherwise, into a lesser number of shares, the
Warrant Price shall be proportionately increased. If the
outstanding Shares are combined or consolidated, by
reclassification or otherwise, into a greater number of shares, the
Warrant Price shall be proportionately decreased.
2.3
Adjustments for Diluting Issuances . The Warrant
Price and the number of Shares issuable upon exercise of this
warrant shall be subject to adjustment, from time to time, in the
manner set forth on Exhibit A in the event of Diluting
Issuances (as defined on Exhibit A ).
2.4
No Impairment . The Company shall not, by
amendment of its Articles of Incorporation or through a
reorganization, transfer of assets, consolidation, merger,
dissolution, issue, or sale of securities or any other voluntary
action, avoid or seek to avoid the observance or performance of any
of the terms to be observed or performed under this warrant by the
Company, but shall at all times in good faith assist in carrying
out all the provisions of this Article 2 and in taking all such
action as may be necessary or appropriate to protect Holder’s
rights under this Article against impairment.
2.5
Certificate as to Adjustments . Upon each
adjustment of the Warrant Price, the Company at its expense shall
promptly compute such adjustment, and furnish Holder with a
certificate of its Chief Financial Officer setting forth such
adjustment and the facts upon which such adjustment is
based. The Company shall, upon written request, furnish
Holder a certificate setting forth the Warrant Price in effect upon
the date thereof and the series of adjustments leading to such
Warrant Price.
ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE
COMPANY .
3.1
Representations and Warranties . The Company
hereby represents and warrants to the Holder as
follows:
(a)
All
Shares which may be issued upon the exercise of the purchase right
represented by this warrant, and all securities, if any, issuable
upon conversion of the Shares, shall, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable, and free
of any liens and encumbrances except for restrictions on transfer
provided for herein or under applicable federal and state
securities laws.
3.2
Notice of Certain Events . If the Company
proposes at any time (a) to declare any dividend or distribution
upon its common stock, whether in cash, property, stock, or other
securities and whether or not a regular cash dividend; (b) to offer
for subscription pro rata to the holders of any class or series of
its stock any additional shares of stock of any class or series or
other rights; (c) to effect any reclassification or
recapitalization of common stock; or (d) to merge or consolidate
with or into any other corporation, or sell, lease, license, or
convey all or substantially all of its assets, or to liquidate,
dissolve or wind up, then, in connection with each such event, the
Company shall give Holder (1) at least 25 days prior written notice
of the date on which a record will be taken for such dividend,
distribution, or subscription rights (and specifying the date on
which the holders of common stock will be entitled thereto) or for
determining rights to vote, if any, in respect of the matters
referred to in (a) and (b) above; and (2) in the case of the
matters referred to in (c) and (d) above at least 25 days prior
written notice of the date when the same will take place (and
specifying the date on which the holders of common stock will be
entitled to exchange their common stock for securities or other
property deliverable upon the occurrence of such
event).
3.3
Information Rights . So long as the Holder holds
this warrant and/or any of the Shares, the Company shall deliver to
the Holder (a) promptly after mailing, copies of all communiques to
the shareholders of the Company, (b) within one hundred and five
(105) days after the end of each fiscal year of the Company, the
annual audited financial statements of the Company certified by
independent public accountants of recognized standing, (c)
within fifty (50) days after the end of each of the first three
quarters of each fiscal year, the Company’s quarterly,
unaudited financial statements, and (d) within thirty (30) days
after the end of each quarter of each fiscal year, a capitalization
table showing all issued and outstanding (i) capital stock of the
Company, organized by class and series, and (b) all options,
warrants and other purchase or acquisition rights with respect to
any class or series of capital stock of the Company held by any
person.
3.4
Registration .
(a)
Definitions .
For purposes of this
Section 3.4 the following terms have the
following definitions:
“
Registrable Stock ” means (i) all
Shares which are issuable pursuant to this warrant, whether or
not the warrant has in fact been exercised and whether or not
such Shares have in fact been issued, (ii) all Shares
acquired by Holder pursuant to this warrant, and
(iii) any shares of Common Stock, whether or not such
shares of Common Stock have in fact been issued, and stock or
other securities of the Company issued in a stock split or
reclassifications of, or a stock dividend or other
distribution on, or in substitution or exchange for, or
otherwise in connection with, such Shares.
“
Commission ” means the U.S. Securities
and Exchange Commission.
“participating holders” means holders of
Registrable Stock included in a registration statement filed with
the Commission pursuant to this Section 3.4 .
“Securities Act” means the Securities Act of
1933, as amended.
(b)
Incidental Registration . Each time the Company
shall determine to file a registration statement under the
Securities Act (other than on Form S-8) in connection with the
proposed offer and sale for money of any of its securities by it or
by any of its security holders, the Company will give written
notice of its determination to all holders of Registrable Stock at
least ten (10) days prior to the filing of such registration
statement. Upon the written request of a holder of any
Registrable Stock, within ten (10) days after receipt of the
above-described notice from the Company, the Company will cause all
such Registrable Stock, the holders of which have so requested
registration thereof, to be included in such registration
statement, all to the extent requisite to permit the sale or other
disposition by the prospective seller or sellers of the Registrable
Stock to be so registered in accordance with the terms of the
proposed offering. If the registration statement is to
cover an underwritten distribution, the Company shall use its best
efforts to cause the Registrable Stock requested for inclusion
pursuant to this Section 3.4(b) to be included in the
underwriting on the same terms and conditions as the securities
otherwise being sold through the underwriters. In the
event of a firm commitment underwriting, if the managing
underwriter of such offering shall advise holders in writing that,
in its good faith opinion, distribution of a specified portion of
the securities requested to be included in the registration
statement would materially adversely affect the distribution of
such securities by increasing the aggregate amount of the offering
in excess of the maximum amount of securities which such managing
underwriter believes can reasonably be sold in the contemplated
distribution, then the securities to be included in the
registration shall be included in the following
order: (1) first, the securities the Company
proposes to include in the underwritten offering, (2) second,
Registrable Stock requested to be included in such registration by
holders of Registrable Stock, on a pro rata basis, and
(3) third, all other shares of securities requested to be
included by any other security holder of the
Company. The Company shall maintain the effectiveness of
any such registration statement until the date which is the later
to occur of (i) the expiration of any such public offering, and
(ii) twelve (12) months from the date that any such registration
statement is declared effective by the Commission.
(c)
Expenses of Registration . All expenses incident
to the Company’s performance of or compliance with this
warrant, including, without limitation, the following shall be
borne by the Company, regardless of whether the registration
statement becomes effective:
(i) All
registration and filing fees (including those with respect to
filings required to be made with the National Association of
Securities Dealers, Inc.);
(ii) Fees
and expenses of compliance with all securities or blue sky
laws (including fees and disbursements of counsel for the
underwriters or participating holders in connection with blue
sky qualifications of the Registrable Stock and in
determination of their eligibility for investment under the
laws of such jurisdictions as the managing underwriters or
participating holders of a majority of the Registrable Stock
being sold may designate);
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(iii)
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Printing,
messenger, telephone, facsimile and delivery expenses;
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(iv) &nb
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