WARRANT EXCHANGE AGREEMENT
Exhibit
10.1
THIS
WARRANT EXCHANGE AGREEMENT, (the “Agreement”) dated as of
August 14, 2009, is made by and among
Techprecision Corporation, a Delaware corporation (the “Company”), ▇▇▇▇▇▇
Partners LP, a Delaware Limited Partnership (the “▇▇▇▇▇▇”) and
GreenBridge Capital Partners IV, LLC, a Delaware limited liability company
(“Greenbridge”
and, together with ▇▇▇▇▇▇, the “Security Holders” and
each, a “Security
Holder”).
WHEREAS,
▇▇▇▇▇▇ is the holder of record of Warrants (the “▇▇▇▇▇▇ Warrants”) to
purchase 3,371,064 shares of the Company’s common stock, par value $0.0001 per
share (“Common
Stock”) and Greenbridge is the holder of record of Warrants (the “Greenbridge
Warrants”) to purchase 5,948,936 shares of Common Stock;
WHEREAS,
▇▇▇▇▇▇ desires to surrender all of the ▇▇▇▇▇▇ Warrants to the Company in
consideration for the issuance of 1,300,490 shares of the Company’s Series A
Convertible Preferred Stock, par value $0.0001 per share (“Preferred Stock”)
(initially convertible into 1,700,000 shares of Common Stock), and the Company
desires to accept the surrender of the ▇▇▇▇▇▇ Warrants in consideration for the
issuance of such shares of Preferred Stock;
WHEREAS,
Greenbridge desires to surrender all of the Greenbridge Warrants to the Company
in consideration for the issuance of 2,294,982 shares of Preferred Stock
(initially convertible into 3,000,000 shares of Common Stock), and the Company
desires to accept the surrender of the Greenbridge Warrants in consideration for
the issuance of such shares of Preferred Stock;
NOW
THEREFORE, in consideration of the mutual agreements and covenants contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
Section
1. Surrender of Warrants and
Issuance of Preferred Stock.
A. Subject
to the terms and conditions of this Agreement, ▇▇▇▇▇▇ hereby surrenders the
▇▇▇▇▇▇ Warrants, including all of ▇▇▇▇▇▇’▇ right, title and interest therein and
thereto, to the Company and the Company hereby accepts the surrender of the
▇▇▇▇▇▇ Warrants in consideration for the issuance by the Company to ▇▇▇▇▇▇ of
1,300,490 shares of Preferred Stock.
B. Subject
to the terms and conditions of this Agreement, Greenbridge hereby surrenders the
Greenbridge Warrants, including all of Greenbridge’s right, title and interest
therein and thereto, to the Company and the Company hereby accepts the surrender
of the Greenbridge Warrants in consideration for the issuance by the Company to
Greenbridge of 2,294,982 shares of Preferred Stock.
Section
2. Representations and
Warranties of Security Holders. Each of the Security Holders
represents and warrants to the Company, severally and not jointly, as
follows:
A. Security
Holder is the legal and beneficial owner of such Security Holder’s Warrants (the
“Securities”),
free and clear of all liens, security interests, pledges, claims, liabilities,
encumbrances and restrictions of any nature whatsoever (other than restrictions
imposed by applicable securities laws); neither the Securities nor any of
Security Holder’s interest in the Securities are now, or at any time in the past
have been, subject to any assignment to a third party; and Security Holder does
not hold or own of record or beneficially any warrants to purchase equity
securities in the Company other than the Securities.
B. The
Company shall acquire good and marketable title to the Securities being
surrendered hereunder, free and clear of any liens, security interests, pledges,
claims, liabilities and restrictions of any nature whatsoever (other than
restrictions imposed by applicable securities laws).
C. There are
no judgments, orders, decrees, injunctions or suits existing, pending or, to the
knowledge of Security Holder, threatened involving or relating to the
Securities.
D. Security
Holder has the power and the authority, corporate or otherwise, to enter into
this Agreement and to carry out its obligations hereunder. The execution,
delivery and performance of this Agreement by Security Holder and the
consummation by Security Holder of the transactions contemplated hereby have
been duly authorized by all requisite actions, corporate or otherwise, as may be
necessary to authorize this Agreement and the transactions contemplated
hereby.
E. This
Agreement, and each other agreement, document, instrument or writing
contemplated by this Agreement, have been duly and validly executed and
delivered by Security Holder and after execution and delivery by Security
Holder, shall constitute valid and binding obligations of Security Holder,
enforceable against Security Holder in accordance with their terms (except that
the enforceability thereof may be (a) limited by applicable bankruptcy,
reorganization, arrangement, insolvency, moratorium, fraudulent conveyance, or
other similar laws affecting the enforceability of creditors’ rights generally
and (b) subject to the availability of equitable remedies). Neither
the execution and delivery of this Agreement by Security Holder nor the
consummation by Security Holder of the transactions contemplated hereby (i)
require the consent of any Person, (ii) give any Person any right in or to the
Securities, or (iii) violate any agreement or instrument to which Security
Holder is a party. “Person” as used herein means a natural person, joint
venture, corporation, sole proprietorship, trust estate, partnership,
cooperative, association, non profit organization, government (including any
branch, agency, subdivision or department thereof) or other entity.
F. Security
Holder confirms that the Securities are being surrendered by Security Holder in
a privately negotiated transaction.
G. Security
Holder is (i) an “accredited investor” as that term is defined in Rule 501 of
Regulation D promulgated under the 1933 Act by reason of Rule 501(a)(3) and (6),
(ii) experienced in making investments of the kind described in this Agreement
and the related documents, (iii) able, by reason of the business and financial
experience of its officers (if an entity) and professional advisors (who are not
affiliated with or compensated in any way by the Company or any of its
affiliates or selling agents), to protect its own interests in connection with
the transactions described in this Agreement and (iv) able to afford the entire
loss of its investment in the securities being purchased by the Security Holder
from the Company. The Security Holder is acquiring the Securities for investment
and not with a view to the sale or distribution thereof and understands that
such Securities are restricted securities, as defined in the 1933 Act, and may
not be sold or otherwise distributed except pursuant to an effective
registration statement or an exemption from the registration requirements of the
1933 Act and that the certificates for such securities shares will bear an
investment legend.
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H. The
Security Holder and such Security Holder’s advisors, if any, have been, upon
request, furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and sale of the
securities being purchased by the Security Holder from the Company. The Security
Holder and such Security Holder’s advisors, if any, have been afforded the
opportunity to ask questions of the Company and have received complete and
satisfactory answers to any such inquiries.
I. Security
Holder confirms that (i) it has independently and without reliance on the
Company, and based on such information as Security Holder has deemed
appropriate, made its own independent financial and legal analysis in connection
with the Company, this Agreement, and the transactions contemplated hereby and
it has consulted with its own advisors with respect thereto as it has deemed
appropriate, (ii) that the Company has no responsibility for the scope of
Security Holder’s financial and legal analysis conducted in connection with the
Company, this Agreement, and the transactions contemplated hereby or any
decision by Security Holder with regard to the scope of such financial and legal
analysis, and (iii) that the Company has no duty or responsibility to conduct
any such financial or legal analysis on behalf of Security Holder.
Section
3. Representations and
Warranties of the Company. The Company represents and warrants
to the Security Holders as follows:
A. The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the state of Delaware, and has the requisite corporate power
and authority to own, lease and operate its properties and to carry on its
business as it is now being conducted.
B. This
Agreement has been duly and validly authorized and executed by the
Company. This Agreement, after execution and delivery by the Company
shall constitute the valid and binding obligations of the Company enforceable
against it in accordance with its terms (except that the enforceability thereof
may be (a) limited by applicable bankruptcy, reorganization, arrangement,
insolvency, moratorium, fraudulent conveyance, or other similar laws affecting
the enforceability of creditors’ rights generally and (b) subject to the
availability of equitable remedies).
C. The
Company on the date of the Closing (i) will have full right, power, and
authority to sell, assign, transfer, and deliver, by reason of record and
beneficial ownership, to the Security Holders, the Preferred Stock hereunder,
free and clear of all liens, charges, claims, options, pledges, restrictions,
and encumbrances whatsoever; and (ii) upon conversion of the Preferred Stock,
the Security Holders will acquire title to such Shares, free and clear of all
liens, charges, claims, options, pledges, restrictions, and encumbrances
whatsoever, except for any of the foregoing which results from actions or
omissions on the part of the Security Holders.
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D. Each
Security Holder acknowledges that the Company is a publicly held company and has
made available to such Security Holder true and complete copies of any requested
SEC Documents. The Company has registered its Common Stock pursuant to Section
12(g) of the 1934 Act. The Company has not provided to the Security Holders any
information that, according to applicable law, rule or regulation, should have
been disclosed publicly prior to the date hereof by the Company, but which has
not been so disclosed.
Section
4. Closing.
A. Contemporaneously
with the execution of this Agreement, or as soon as practicable thereafter, the
parties shall effect a closing of the transactions contemplated hereby (the
“Closing”).
B. At the
Closing, Barren shall deliver to the Company the ▇▇▇▇▇▇ Warrants marked
“Cancelled” together with an executed assignment form completed in blank;
and
C. At the
Closing, Greenbridge shall deliver to the Company the Greenbridge Warrants
marked “Cancelled” together with an executed assignment form completed in blank
..
D. At the
Closing, the Company shall deliver certificates representing (i) 1,300,490
shares of Preferred Stock to ▇▇▇▇▇▇ and (ii) 2,294,982 shares of Preferred Stock
to Greenbridge.
Section
5. Volume
Limitations. Subject to any additional limitations imposed by
any applicable state or federal securities law, from and after the date hereof,
and after giving effect to the consummation of the transactions contemplated
hereby, each Security Holder hereby agrees that such Security Holder will sell,
in the aggregate, no more than 25% of such Security Holder’s aggregate holdings
of the Company’s equity securities during any fiscal quarter of the
Company. For purposes of this Section, such Security Holder’s
aggregate holdings of the Company’s equity securities will be calculated as of
the last day of the immediately preceding fiscal quarter and such calculation
shall assume the conversion of any convertible securities and the exercise of
any exercisable securities held by such Security Holder at the time of such
calculation. This Section 5 of the Agreement will have a term of
twelve months from the date of this agreement expiring on August 15,
2010.
Section
6. Transfer
Restrictions. Each of the Security Holders acknowledge that
(1) the Preferred Stock and shares underlying the Preferred Stock have not been
registered under the provisions of the 1933 Act, and may not be transferred
unless (A) subsequently registered thereunder or (B) such Security Holder shall
have delivered to the Company an opinion of counsel, reasonably satisfactory in
form, scope and substance to the Company, to the effect that the Preferred Stock
and shares of Common Stock underlying the Preferred Stock to be sold or
transferred may be sold or transferred pursuant to an exemption from such
registration; and (2) any sale of the Preferred Stock and shares of Common Stock
underlying the Preferred Stock made in reliance on Rule 144 promulgated under
the 1933 Act may be made only in accordance with the terms of said Rule and
further, if said Rule is not applicable, any resale of such securities under
circumstances in which the seller, or the person through whom the sale is made,
may be deemed to be an underwriter, as that term is used in the 1933 Act, may
require compliance with some other exemption under the 1933 Act or the rules and
regulations of the SEC thereunder.
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Section
7. Restrictive Legend.
Each Security Holder acknowledges and agrees that the Preferred Stock and the
shares of Common Stock underlying the Preferred Stock, and, until such time as
the shares of Common Stock underlying the Preferred Stock have been registered
under the 1933 Act and sold in accordance with an effective Registration
Statement, certificates and other instruments representing any of the shares of
Preferred Stock or Common Stock underlying the Preferred Stock, shall bear a
restrictive legend in substantially the following form (and a stop-transfer
order may be placed against transfer of any such securities):
“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE
SECURITIES LAWS AND NEITHER SUCH SHARES NOR ANY INTEREST THEREIN MAY BE OFFERED,
SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION
STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT, OR (2) IN
ACCORDANCE WITH THE PROVISIONS OF REGULATION S, OR (3) AN EXEMPTION FROM
REGISTRATION IS AVAILABLE UNDER THE SECURITIES ACT AND APPLICABLE STATE
SECURITIES LAWS AND THE HOLDER HAS PROVIDED THE COMPANY WITH AN OPINION OF
COUNSEL TO SUCH EFFECT.”
Section
8. Notices.
A. All
notices, consents and other communications required or permitted under this
Agreement shall be in writing, and shall be deemed to have been duly given (a)
when delivered personally, (b) three business days after being mailed by first
class certified mail, postage prepaid, return receipt requested, or (c) one
business day after being sent by a recognized overnight delivery service,
postage or delivery charges prepaid, to the parties at their respective
addresses stated on the signature page of this Agreement. Notices may
also be given by prepaid telegram or facsimile and shall be effective on the
date transmitted if confirmed within 24 hours thereafter by a signed original
sent in the manner provided in the preceding sentence. Any party may
change its address for notices by giving notice of a new address to each other
party in accordance with this Section, except that any such change of address
notice shall not be effective unless and until received.
B. The
Company and each Security Holder hereby waive any notice required under the
terms of the Securities or pursuant to any agreements governing the Securities
to effectuate the surrender of the Securities pursuant to this Agreement and
agree that such surrender is permitted under such terms or pursuant to any such
agreements.
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Section
9. Miscellaneous.
A. This
Agreement constitutes the entire agreement of the parties with respect to the
subject matter hereof and supersedes any and all prior written or oral
communications and agreements, and all contemporaneous oral communications among
the parties concerning the subject matter hereof.
B. No
provision of this Agreement may be amended, changed or modified in any manner,
orally or otherwise, except by an instrument in writing signed by all parties
affected by such provision.
C. This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective heirs, executors, administrators, successors and
assigns. No party shall in any manner assign any of its rights or
obligations under this Agreement without the express prior written consent of
the other parties.
D. THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF DELAWARE, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW OF
ANY JURISDICTION.
E. This
Agreement may be executed in counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same
instrument. In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid and binding obligation of the
party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature page were an original
thereof.
F. All
agreements, representations and warranties made in this Agreement or pursuant
hereto shall survive the date hereof, any investigation, and the consummation of
the transactions contemplated hereby.
G. If any
term or provision of this Agreement or the application thereof to any Person or
circumstances shall to any extent, be invalid or unenforceable, then the
remainder of this Agreement or the application of such term or provision to
Persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Agreement shall be valid and enforced to the fullest extent permitted by
law.
H. Headings
and captions herein are inserted for convenience, do not constitute a part of
this Agreement, and shall not be admissible for the purpose of proving the
intent of the parties.
[Remainder
of Page Intentionally Left Blank.]
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IN
WITNESS WHEREOF, the parties have caused this Exchange Agreement to be duly
executed by their respective officers thereonto duly authorized as of the day
and year first above written.
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TECHPRECISION
CORPORATION
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By:
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/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Name:
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▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇
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Title:
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Chief
Financial Officer
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Address:
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▇
▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
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Facsimile:
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(▇▇▇)
▇▇▇-▇▇▇▇
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▇▇▇▇▇▇
PARTNERS LP
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By:
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▇▇▇▇▇▇
Capital Advisors, LLC,
its
General Partner
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By:
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/s/
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name:
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▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title:
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Managing
Partner
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Address:
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▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
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▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇
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Facsimile:
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(▇▇▇)
▇▇▇-▇▇▇▇
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GREENBRIDGE
CAPITAL PARTNERS IV, LLC
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By:
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/s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name:
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▇▇▇▇▇▇
▇. ▇▇▇▇▇
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Title:
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Managing
Member
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Address:
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▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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Facsimile:
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(▇▇▇)
▇▇▇-▇▇▇▇
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