THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT") OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE OFFERED, SOLD
OROTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS, OR SUCH OFFERS, SALES AND TRANSFERS ARE
MADE PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THOSE LAWS.
Right to Purchase _______ Shares of Common Stock,
par value of $0.001 per share
Date: _____________________
UNIVERSAL BEVERAGES HOLDING CORPORATION
COMMON STOCK PURCHASE WARRANT
This certifies that, for value received, ______________ or his
registered assigns, is entitled to purchase from UNIVERSAL BEVERAGES HOLDINGS
CORPORATION, a Florida corporation (the "COMPANY"), at any time or from time to
time during the period specified in Section 2 hereof, ______ fully paid and
nonassessable shares of the Company's Common Stock, par value $0.001 per share
(the "COMMON STOCK"), at an exercise price per share (the "EXERCISE PRICE") of
FIFTY CENTS ($.50) per share. The number of shares of Common Stock purchasable
hereunder (the "WARRANT SHARES") and the Exercise Price are subject to
adjustment as provided in Section 4 hereof.
This Warrant is subject to the following terms, provisions and
conditions:
1. MANNER OF EXERCISE; ISSUANCE OF CERTIFICATES; PAYMENT FOR SHARES.
Subject to the provisions hereof, including, without limitation, the limitations
contained in Section 7 hereof, this Warrant may be exercised by the holder
hereof, in whole or in part, by the surrender of this Warrant, together with a
completed exercise agreement in the form attached hereto (the "EXERCISE
AGREEMENT"), to the Company during normal business hours on any business day at
the Company's principal executive offices (or such other office or agency of the
Company as it may designate by notice to the holder hereof), by payment to the
Company in cash, by certified or official bank check or by wire transfer for the
account of the Company, of the Exercise Price for the Warrant Shares specified
in the Exercise Agreement. The Warrant Shares so purchased shall be deemed to be
issued to the holder or the holder's designee, as the record owner of such
shares, as of the close of business on the date on which this Warrant shall have
been surrendered, the completed Exercise Agreement shall have been delivered,
and payment shall have been made for such shares as set forth above.
Certificates for the Warrant Shares so purchased, representing the aggregate
number of shares specified in the Exercise Agreement, shall be delivered to the
holder hereof within a reasonable time, not exceeding ten business days, after
this Warrant shall have been so exercised. The certificates so delivered shall
be in such denominations as may be requested by the holder hereof and shall be
registered in the name of such holder or such other name as shall be designated
by such holder. If this Warrant shall have been exercised only in part, then,
unless this Warrant has expired, the Company shall, at its expense, at the time
of delivery of such certificates, deliver to the holder a new Warrant
representing the number of shares with respect to which this Warrant shall not
then have been exercised.
2. PERIOD OF EXERCISE. This Warrant is exercisable upon the earlier of
one year from the date of this warrant or upon the effectiveness of a
registration statement filed by the Company which registers the shares of common
stock underlying this Warrant and before 5:00 p.m., New York City time on or
before March 31, 2002 (the "EXERCISE PERIOD").
3. CERTAIN AGREEMENTS OF THE COMPANY. The Company hereby covenants and
agrees as follows:
(a) SHARES TO BE FULLY PAID. All Warrant Shares will, upon issuance
in accordance with the terms of this Warrant, be validly issued, fully paid and
nonassessable and free from all taxes, liens, claims and encumbrances.
(b) RESERVATION OF SHARES. During the Exercise Period, the Company
shall at all times have authorized, and reserved for the purpose of issuance
upon exercise of this Warrant, a sufficient number of shares of Common Stock to
provide for the exercise of this Warrant.
(c) CERTAIN ACTIONS PROHIBITED. The Company will not, by amendment
of its charter or through any 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 by it hereunder, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant and in the
taking of all such action as may reasonably be requested by the holder of this
Warrant in order to protect the exercise privilege of the holder of this Warrant
against dilution or other impairment, consistent with the tenor and purpose of
this Warrant. Without limiting the generality of the foregoing, the Company (i)
will not increase the par value of any shares of Common Stock receivable upon
the exercise of this Warrant above the Exercise Price then in effect, and (ii)
will take all such actions as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and nonassessable shares of
Common Stock upon the exercise of this Warrant.
4. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF WARRANT SHARES. During
the Exercise Period, the Exercise Price and the number of Warrant Shares shall
be subject to adjustment from time to time as provided in this Section 4.
(a) SUBDIVISION OR COMBINATION OF COMMON STOCK. If the Company at
any time during the Exercise Period subdivides (by any stock split, stock
dividend, recapitalization, reorganization, reclassification or otherwise) its
shares of Common Stock into a greater number of shares, then, after the date of
record for effecting such subdivision, the Exercise Price in effect immediately
prior to such subdivision will be proportionately reduced. If the Company at any
time during the Exercise Period combines (by reverse stock split,
recapitalization, reorganization, reclassification or otherwise) its shares of
Common Stock into a smaller number of shares, then, after the date of record for
effecting such combination, the Exercise Price in effect immediately prior to
such combination will be proportionately increased.
(b) CONSOLIDATION, MERGER OR SALE. In case of any consolidation of
the Company with, or merger of the Company into, any other corporation, or in
case of any sale or conveyance of all or substantially all of the assets of the
Company other than in connection with a plan of complete liquidation of the
Company at any time during the Exercise Period, then as a condition of such
consolidation, merger or sale or conveyance, adequate provision will be made
whereby the holder of this Warrant will have the right to acquire and receive
upon exercise of this Warrant in lieu of the shares of Common Stock immediately
theretofore acquirable upon the exercise of this Warrant, such shares of stock,
securities or assets as may be issued or payable with respect to or in exchange
for the number of shares of Common Stock immediately theretofore acquirable and
receivable upon exercise of this Warrant had such consolidation, merger or sale
or conveyance not taken place. In any such case, the Company will make
appropriate provision to insure that the provisions of this Section 4 will
thereafter be applicable as nearly as may be possible in relation to any shares
of stock or securities thereafter deliverable upon the exercise of this Warrant.
The Company will not effect any consolidation, merger or sale or conveyance
unless prior to the consummation thereof, the successor corporation (if other
than the Company) assumes by written instrument the obligations under this
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Section 4 and the obligations to deliver to the holder of this Warrant such
shares of stock, securities or assets as, in accordance with the foregoing
provisions, the holder may be entitled to acquire.
(c) ADJUSTMENT IN NUMBER OF SHARES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this Section 4, the number of
shares of Common Stock issuable upon exercise of this Warrant shall be adjusted
by multiplying a number equal to the Exercise Price in effect immediately prior
to such adjustment by the number of shares of Common Stock issuable upon
exercise of this Warrant immediately prior to such adjustment and dividing the
product so obtained by the adjusted Exercise Price.
(d) MINIMUM ADJUSTMENT OF EXERCISE PRICE. No adjustment of the
Exercise Price shall be made in an amount of less than 1% of the Exercise Price
in effect at the time such adjustment is otherwise required to be made, but any
such lesser adjustment shall be carried forward and shall be made at the time
and together with the next subsequent adjustment which, together with any
adjustments so carried forward, shall amount to not less than 1% of such
Exercise Price.
(e) FRACTIONAL EXERCISE PRICE. In the event that any adjustment of
the Exercise Price required herein results in a fraction of a cent, then the
Exercise Price shall be rounded up to the nearest cent.
(f) FRACTIONAL SHARES. No fractional shares of Common Stock are to
be issued upon the exercise of this Warrant, but the Company shall pay a cash
adjustment in respect of any fractional share which would otherwise be issuable
in an amount equal to the same fraction of the Market Price (as defined in
Section 4(k)) of a share of Common Stock on the date of such exercise.
(g) NOTICE OF ADJUSTMENT. Upon the occurrence of any event which
requires any adjustment of the Exercise Price, then, and in each such case, the
Company shall give notice thereof to the holder of this Warrant, which notice
shall state the Exercise Price resulting from such adjustment and the increase
or decrease in the number of Warrant Shares purchasable at such price upon
exercise, setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based. Such calculation shall be certified
by the chief financial officer of the Company.
(h) OTHER NOTICES. In case at any time:
(i) the Company shall declare any dividend upon the Common Stock
payable in shares of stock of any class or make any other distribution (other
than dividends) or
(ii) there shall be any capital reorganization of the Company,
or reclassification of the Common Stock, or consolidation or merger of the
Company with or into, or sale of all or substantially all of its assets to,
another corporation or entity; or distributions payable in cash out of retained
earnings consistent with the Company's past practices with respect to declaring
dividends and making distributions) to the holders of the Common Stock;
(iii) there shall be a voluntary or involuntary dissolution,
liquidation or winding-up of the Company;
then, in each such case, the Company shall give to the holder of this Warrant
(a) notice of the date on which the books of the Company shall close or a record
shall be taken for determining the holders of Common Stock entitled to receive
any such dividend, distribution, or subscription rights or for determining the
holders of Common Stock entitled to vote in respect of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding-up and (b) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding-up, notice of
the date (or, if not then known, a reasonable approximation thereof by the
Company) when the same shall take place. Such notice shall also specify the date
on which the holders of Common Stock shall be entitled to receive such dividend,
distribution, or subscription rights or to exchange their Common Stock for stock
3
or other securities or property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation, or
winding-up, as the case may be. Such notice shall be given at least 30 days
prior to the record date or the date on which the Company's books are closed in
respect thereto. Failure to give any such notice or any defect therein shall not
affect the validity of the proceedings referred to in clauses (i), (ii) and
(iii) above.
(iv) "MARKET PRICE," as of any date, (i) means the average of the
closing bid prices for the shares of Common Stock as reported on the Nasdaq
National Market for the five (5) trading days immediately preceding such date,
or (ii) if the Nasdaq National Market is not the principal trading market for
the shares of Common Stock, the average of the last reported bid prices on the
principal trading market for the Common Stock during the same period, or, if
there is no bid price for such period, the last reported sales price for such
period, or (iii) if market value cannot be calculated as of such date on any of
the foregoing bases, the Market Price shall be the average fair market value as
reasonably determined by an investment banking firm selected by the Company and
reasonably acceptable to the holder, with the costs of the appraisal to be borne
by the Company. The manner of determining the Market Price of the Common Stock
set forth in the foregoing definition shall apply with respect to any other
security in respect of which a determination as to market value must be made
hereunder.
(v) "COMMON STOCK," for purposes of this Section 4, includes the
Common Stock and any additional class of stock of the Company having no
preference as to dividends or distributions on liquidation, provided that the
shares purchasable pursuant to this Warrant shall include only Common Shares,
par value $0.001 per share, in respect of which this Warrant is exercisable, or
shares resulting from any subdivision or combination of such Common Stock, or in
the case of any reorganization, reclassification, consolidation, merger, or sale
of the character referred to in Section 4(j) hereof, the stock or other
securities or property provided for in such Section.
5. ISSUE TAX. The issuance of certificates for Warrant Shares upon the
exercise of this Warrant shall be made without charge to the holder of this
Warrant or such shares for any issuance tax or other costs in respect thereof,
PROVIDED that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and delivery of any
certificate in a name other than the holder of this Warrant.
6. NO RIGHTS OR LIABILITIES AS A SHAREHOLDER. This Warrant shall not
entitle the holder hereof to any voting rights or other rights as a shareholder
of the Company. No provision of this Warrant, in the absence of affirmative
action by the holder hereof to purchase Warrant Shares, and no mere enumeration
herein of the rights or privileges of the holder hereof, shall give rise to any
liability of such holder for the Exercise Price or as a shareholder of the
Company, whether such liability is asserted by the Company or by creditors of
the Company.
7. TRANSFER, EXCHANGE, REDEMPTION AND REPLACEMENT OF WARRANT.
(a) RESTRICTION ON TRANSFER. This Warrant and the rights granted to
the holder hereof are transferable with the prior written consent of the
Company, in whole or in part, upon surrender of this Warrant, together with a
properly executed assignment in the form attached hereto, at the office or
agency of the Company referred to in Section 7(e) below, PROVIDED, however, that
any transfer or assignment shall be subject to the conditions set forth in
Section 7(f) hereof. Until due presentment for registration of transfer on the
books of the Company, the Company may treat the registered holder hereof as the
owner and holder hereof for all purposes, and the Company shall not be affected
by any notice to the contrary.
(b) WARRANT EXCHANGEABLE FOR DIFFERENT DENOMINATIONS. This Warrant
is exchangeable, upon the surrender hereof by the holder hereof at the office or
agency of the Company referred to in Section 7(e) below, for new Warrants of
like tenor of different denominations representing in the aggregate the right to
purchase the number of shares of Common Stock which may be purchased hereunder.
Each of such new Warrants shall represent the right to purchase such number of
shares as shall be designated by the holder hereof at the time of such
surrender.
4
(c) REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction, or mutilation of
this Warrant and, in the case of any such loss, theft, or destruction, upon
delivery of an indemnity agreement reasonably satisfactory in form and amount to
the Company, or, in the case of any such mutilation, upon surrender and
cancellation of this Warrant, the Company, at its expense, will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
(d) CANCELLATION; PAYMENT OF EXPENSES. Upon the surrender of this
Warrant in connection with any transfer, exchange, or replacement as provided in
this Section 7, this Warrant shall be promptly canceled by the Company. The
Company shall pay all taxes (other than securities transfer taxes) and all other
expenses (other than legal expenses, if any, incurred by the holder or
transferees) and charges payable in connection with the preparation, execution,
and delivery of Warrants pursuant to this Section 7.
(e) WARRANT REGISTER. The Company shall maintain, at its principal
executive offices (or such other office or agency of the Company as it may
designate by notice to the holder hereof), a register for this Warrant, in which
the Company shall record the name and address of the person in whose name this
Warrant has been issued, as well as the name and address of each transferee and
each prior owner of this Warrant.
(f) EXERCISE OR TRANSFER WITHOUT REGISTRATION. If, at the time of
the surrender of this Warrant in connection with any exercise, transfer, or
exchange of this Warrant, this Warrant (or, in the case of any exercise, the
Warrant Shares issuable hereunder), shall not be registered under the Securities
Act and under applicable state securities or blue sky laws, the Company may
require, as a condition of allowing such exercise, transfer, or exchange, (i)
that the holder of this Warrant furnish to the Company a written opinion of
counsel (which opinion shall be in form, substance and scope customary for
opinions of counsel in comparable transactions) to the effect that such
exercise, transfer, or exchange may be made without registration under the
Securities Act and under applicable state securities or blue sky laws, (ii) that
the holder execute and deliver to the Company an investment letter in form and
substance acceptable to the Company and (iii) that the transferee be an
"ACCREDITED INVESTOR" as defined in Rule 501(a) promulgated under the Securities
Act.
(g) REDEMPTION. If, at any time after the date of issuance, the
average selling price for the shares of Common Stock as reported on the Nasdaq
National Market (or the then principal trading market for the Common Stock if
not the Nasdaq National Market) (the "REPORTED PRICE"), shall, for five (5)
trading days within any period of ten (10) consecutive trading days (the
"DETERMINATION PERIOD"), be greater than or equal to $2.00 (subject to equitable
adjustments from time to time for the events described in Section 4(a)), then
the Company shall have the right, exercisable on the first trading day after the
Determination Period, by written notice to the holders of this Warrant (a
"REDEMPTION NOTICE") of such exercise at least thirty (30) days prior to the
date of redemption (the "REDEMPTION DATE") to redeem this Warrant and all, but
not less than all, of the other Warrants then outstanding in full at a
redemption price per Warrant equal to the product of (i) the number of shares of
Common Stock issuable upon the exercise of such Warrant, multiplied by (ii)
$.01. Nothing herein shall prevent the exercise of, and the holder shall have
the right to exercise this Warrant at any time during the period after the
Redemption Notice and on or prior to the Redemption Date.
(h) BROKER FEES. The holder of this Warrant shall indemnify the
Company and hold it harmless for the fees of any broker engaged by the holder in
connection with the transfer or exercise of this Warrant or otherwise. The
Company shall indemnify and hold the holder of this Warrant harmless for the
fees of any broker engaged by the Company in connection with the issuance or
redemption of this Warrant or otherwise.
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8. REGISTRATION RIGHTS.
(a) PIGGY-BACK REGISTRATIONS.
(i) If at any time during the Exercise Period, the Company shall
file with the SEC a Registration Statement under the Securities Act (a
"REGISTRATION STATEMENT") relating to an underwritten offering for its own
account or the account of others of any of its equity securities, other than on
Form S-4 or Form S-8 or their then equivalents relating to equity securities to
be issued solely in connection with any acquisition of any entity of business or
equity securities issuable in connection with stock option or other employee
benefit plans, the Company shall send to each holder who is entitled to
registration rights under this Section 8(b) written notice of such determination
and, if within twenty (20) days after receipt of such notice, such Warrantholder
shall so request in writing, the Company shall include in such Registration
Statement all or any part of the Warrant Shares such Warrantholder requests to
be registered, except that if, in connection with any underwritten public
offering for the account of the Company the managing underwriter(s) thereof
shall impose a limitation on the number of shares of Common Stock which may be
included in the Registration Statement because, in such underwriter(s)'
judgment, marketing or other factors dictate such limitation is necessary to
facilitate public distribution, then the Company shall be obligated to include
in such Registration Statement only such limited portion of the Warrant Shares
with respect to which such Warrantholder has requested inclusion hereunder. Any
exclusion of Warrant Shares shall be made pro rata among the holders of all
shares of Common Stock (or securities convertible into Common Stock) seeking to
include such shares in the Registration Statement in proportion to the number of
registerable Securities sought to he included by such Warrantholders. The
obligations of the Company under this Section 8(b) may be waived by
Warrantholders holding a majority in interest of the Warrant Shares and shall
expire after the Company has afforded the opportunity for the Warrantholders to
exercise registration rights under this Section 8(b) for two registrations;
PROVIDED, however, that any Warrantholder who shall have had any Warrant Shares
excluded from any Registration Statement in accordance with this Section 8(b)
shall be entitled to include in an additional Registration Statement filed by
the Company the Warrant Shares so excluded. If an offering in connection with
which an Warrantholder is entitled to registration under this Section 8(b) is an
underwritten offering, then each Warrantholder whose Warrant Shares are included
in such Registration Statement shall, unless otherwise agreed by the Company,
offer and sell such Warrant Shares in an underwritten offering using the same
underwriter or underwriters and, subject to the provisions of this Agreement, on
the same terms and conditions as other shares of Common Stock included in such
underwritten offering.
(b) SALES UNDER RULE 144. Notwithstanding the registration of
Warrant Shares in accordance with Section 8(a), if at any time of offer and sale
of such Warrant Shares by an Warrantholder such Warrant Shares can be sold
pursuant to Rule 144 promulgated under the Securities Act or any other similar
rule or regulation of the SEC that may at anytime permit the Warrantholder to
sell securities of the Company to the public without registration ("RULE 144")
in the manner, amount and on such terms as such Warrantholder wishes to offer
and sell such Warrant Shares, such Warrantholder may endeavor to offer and sell
such Warrant Shares pursuant to Rule 144; PROVIDED, however, that such
Warrantholder shall not be required to limit the amount or manner of sale or
otherwise modify such offer or sale to use Rule 144; and PROVIDED FURTHER,
however, that such Warrantholder shall have no liability to the Company under
this Section 8(b) if such Warrantholder does not offer and sell such Warrant
Shares pursuant to Rule 144 notwithstanding the availability thereof.
(c) OBLIGATIONS OF THE COMPANY. In connection with the registration
of the Warrant Shares, the Company shall:
(i) prepare promptly and file with the SEC a Registration
Statement or Statements with respect to all Warrant Shares to be included
therein, and thereafter use its best efforts to cause the Registration Statement
to become effective as soon as possible after such filing, and, if the
Registration Statement utilizes to Rule 415 promulgated under the Securities Act
or any other similar rule or regulation of the SEC that may at anytime permit
the Company to register securities to the public on a continuous or delayed
basis ("RULE 415"), to keep the Registration Statement effective at all times
until the date that is six months after the date such Registration Statement is
first ordered effective by the SEC (plus the number of days in the period of
6
discontinuance referred to in Section 8(e)(iii) hereof). In any case, the
Registration Statement (including any amendments or supplements thereto and
prospectuses contained therein) filed by the Company shall not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein, or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading;
(ii) furnish to each Warrantholder whose Warrant Shares are
included in the Registration Statement (i) promptly after the same is filed with
the SEC, one copy of the Registration Statement and any amendment thereto, each
preliminary prospectus and prospectus and each amendment or supplement thereto
and (ii) such number of copies of a prospectus, including a preliminary
prospectus, and all amendments and supplements thereto and such other documents
as such Warrantholder may reasonably request in order to facilitate the
disposition of the Warrant Shares owned by such Warrantholder;
(iii) use reasonable efforts to (i) register and qualify the
Warrant Shares covered by the Registration Statement under such other securities
or blue sky laws of such jurisdictions as the Warrantholders who hold a majority
in interest of the Warrant Shares being offered reasonably request, (ii) prepare
and file in those jurisdictions such amendments (including post-effective
amendments) and supplements, (iii) take such other actions as may be necessary
to maintain such registrations and qualifications in effect at all times, if the
Registration Statement utilizes to Rule 415, effective at all times until the
date that is six (6) months after the date such Registration Statement is first
ordered effective by the SEC; and (iv) take all other ac reasonably necessary or
advisable to qualify the Warrant Shares for sale in jurisdictions; PROVIDED,
however, that the Company shall not be required in connection therewith or as a
condition thereto to (a) qualify to do business any jurisdiction where it would
not otherwise be required to qualify but for this Section 8(d)(iii), (b) subject
itself to general taxation in any such jurisdiction, (c) file a general consent
to service of process in any such jurisdiction, (d) provide any undertakings
that cause more than nominal expense or burden to the Company or (e) make any
change in its charter or bylaws, which in each case the Board of Directors of
the Company determines to be contrary to the best interests of the Company and
its stockholders;
(iv) as promptly as practicable after becoming aware of such
event, notify each Warrantholder who holds Warrant Shares being sold pursuant to
such registration of the happening of any event of which the Company has
knowledge, as a result of which the prospectus included in the Registration
Statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, and use its best efforts promptly to prepare a supplement
or amendment to the Registration Statement to correct such untrue statement or
omission, and deliver a number of copies of such supplement or amendment to each
Warrantholder as such Warrantholder may reasonably request;
(v) as promptly as practicable after becoming aware of such
event, notify each Warrantholder who holds Warrant Shares being sold pursuant to
such registration of the issuance by the SEC of any stop order or other
suspension of effectiveness of the Registration Statement at the earliest
possible time;
(vi) take all other reasonable actions necessary to expedite and
facilitate disposition by the Warrantholder of the Warrant Shares pursuant to
the Registration Statement.
(d) OBLIGATIONS OF THE WARRANTHOLDERS. In connection with the
registration of the Warrant Shares, the Warrantholders shall have the following
obligations:
(i) It shall be a condition precedent to the obligations of the
Company to complete the registration pursuant to this Agreement with respect to
each Warrantholder that such Warrantholder shall furnish to the Company such
information regarding itself, the Warrant Shares held by it and the intended
method of disposition of the Warrant Shares held by it as shall be reasonably
required to effect the registration of the Warrant Shares and shall execute such
documents in connection with such registration as the Company may reasonably
7
request. At least fifteen (15) days prior to the first anticipated filing date
of the Registration Statement, the Company shall notify each Warrantholder of
the information the Company requires from each such Warrantholder (the
"REQUESTED INFORMATION") if such Warrantholder elects to have any of such
Warrantholder's Warrant Shares included in the Registration Statement. If within
five (5) business days prior to the filing date the Company has not received the
Requested Information from an Warrantholder (a "NON-RESPONSIVE WARRANTHOLDER"),
then the Company may file the Registration Statement without including Warrant
Shares of such Non-Responsive Warrantholder;
(ii) Each Warrantholder by such Warrantholder's acceptance of
the Warrant Shares agrees to cooperate with the Company as reasonably requested
by the Company in connection with the preparation and filing of the Registration
Statement hereunder, unless such Warrantholder has notified the Company in
writing of such Warrantholder's election to exclude all of such Warrantholder's
Warrant Shares from the Registration Statement;
(iii) Each Warrantholder agrees that, upon receipt of any notice
from the Company of the happening of any event of the kind described in Section
8(c)(iv) or 8(c)(v), such Warrantholder will immediately discontinue disposition
of Warrant Shares pursuant to the Registration Statement covering such Warrant
Shares until such Warrantholder's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 8(c)(iv) and, if so directed by the
Company, such Warrantholder shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of destruction)
all copies in such Warrantholder's possession, of the prospectus covering such
Warrant Shares current at the time of receipt of such notice;
(iv) In the event Warrantholders holding a majority in interest
of Warrant Shares being registered determined to engage the services of an
underwriter, each Warrantholder agrees to enter into and perform such
Warrantholder's obligations under an underwriting agreement, in usual and
customary form, including, without limitation, customary indemnification and
contribution obligations, with the managing underwriter of such offering and
take such other actions as are reasonably required in order to expedite or
facilitate the disposition of the Warrant Shares, unless such Warrantholder has
notified the Company in writing of such Warrantholder's election to exclude all
of such Warrantholder's Warrant Shares from the Registration Statement; and
(v) No Warrantholder may participate in any underwritten
registration hereunder unless such Warrantholder (i) agrees to sell such
Warrantholder's Warrant Shares on the basis provided in any underwriting
arrangements approved by the Warrantholders entitled hereunder to approve such
arrangements, (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
requested under the terms of such underwriting arrangements and (iii) agrees to
pay its pro rata share of all underwriting discounts and commissions and other
fees and expenses of investment bankers and any manager or managers of such
underwriting and legal expenses of the underwriters applicable with respect to
its Warrant Shares, in each case to the extent not payable by the Company
pursuant to the terms of this Agreement.
(e) EXPENSES OF REGISTRATION. All expenses (other than brokerage
commissions or discounts) incurred in connection with registrations, filings or
qualifications pursuant to Section 8(d)(iii), including, without limitation, all
registration, listing and qualifications fees, printers and accounting fees and
the fees and disbursements of counsel for the Company, shall be borne by the
Company; PROVIDED, HOWEVER, that the Warrantholders shall bear the fees and
out-of-pocket expenses of the one legal counsel selected by the Warrantholders
pursuant to Section 8(d)(vi) hereof.
(f) INDEMNIFICATION. In the event any Warrant Shares are included in
a Registration Statement under this Agreement:
(i) To the extent permitted by law, the Company will indemnify
and hold harmless each Warrantholder who holds such Warrant Shares, the
directors, if any, of such Warrantholder, the officers, if any, of such
Warrantholder, each person, if any, who controls any Warrantholder within the
8
meaning of the Securities Act or the Exchange Act, any underwriter (as defined
in the Securities Act) for the Warrantholders, the directors, if any, of such
underwriter and the officers, if any, of such underwriter, and each person, if
any, who controls any such underwriter within the meaning of the Securities Act
or the Exchange Act (each, an "INDEMNIFIED PERSON"), against any losses, claims,
damages, expenses or liabilities (joint or several) (collectively "CLAIMS") to
which any of them become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such Claims (or actions or proceedings, whether commenced
or threatened, in respect thereof) arise out of or are based upon any of the
following statements, omissions or violations in the Registration Statement, or
any post-effective amendment thereof, or any prospectus included therein: (i)
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or any post-effective amendment thereof or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, (ii)
any untrue statement or alleged untrue statement of a material fact contained in
any preliminary prospectus if used prior to the effective date of such
Registration Statement, or contained in the final prospectus (as amended or
supplemented, if the Company files any amendment thereof or supplement thereto
with the SEC) or the omission or alleged omission to state therein any material
fact necessary to make the statements made therein, in light of the
circumstances under which the statements therein were made, not misleading or
(iii) any violation or alleged violation by the Company of the Securities Act,
the Exchange Act or any state securities law or any rule or regulation under the
Securities Act, the Exchange Act or any state securities law (the matters in the
foregoing clauses (i) through (iii) being, collectively, "VIOLATIONS"). Subject
to the restrictions set forth in Section 8(f)(iv) with respect to the number of
legal counsel, the Company shall reimburse the Warrantholders and each such
underwriters or controlling person, promptly as such expenses are incurred and
are due and payable, for any legal fees or other reasonable expenses incurred by
them in connection with investigating or defending any such Claim.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 8(f)(i) (a) shall not apply to a Claim
arising out of or based upon a Violation which occurs in reliance upon and in
conformity with information furnished in writing to the Company by any
Indemnified Person or underwriter for such Indemnified Person expressly for use
in connection with the preparation of the Registration Statement or any such
amendment thereof or supplement thereto, if such prospectus was timely made
available by the Company pursuant to Section 8(c)(ii) hereof; (b) with respect
to any preliminary prospectus shall not inure to the benefit of any such person
from whom the person asserting any such Claim purchased the Warrant Shares that
are the subject thereof (or to the benefit of any person controlling such
person) if the untrue statement or omission of material fact contained in the
preliminary prospectus was corrected in the prospectus, as then amended or
supplemented, if such prospectus was timely made available by the Company
pursuant to Section 8(d)(ii) hereof; (c) shall not be available to the extent
such Claim is based on a failure of the Warrantholder to deliver or cause to be
delivered the prospectus made available by the Company; and (d) shall not apply
to amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of the Company, which consent shall not be
unreasonably withheld.
(ii) In connection with any Registration Statement in which an
Warrantholder is participating, each such Warrantholder agrees to indemnify and
hold harmless, to the same extent and in the same manner set forth in Section
8(f)(i), the Company, each of its directors, each of its officers who signs the
Registration Statement, each person, if any, who controls the Company within the
meaning of the Securities Act or the Exchange Act (collectively and together
with an Indemnified Person, an "INDEMNIFIED PARTY"), against any Claim to which
any of them may become subject, under the Securities Act, the Exchange Act or
otherwise, insofar as such Claim arises out of or is based upon any Violation,
in each case to the extent (and only to the extent) that such Violation occurs
(a) in reliance upon and in conformity with written information furnished to the
Company by such Warrantholder expressly for use in connection with such
Registration Statement or (b) the Warrantholder's violation of Regulation M; and
such Warrantholder will promptly reimburse any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such Claim; PROVIDED, however, that the indemnity agreement contained in this
Section 8(f)(ii) shall not apply to amounts paid in settlement of any Claim if
such settlement is effected without the prior written consent of such
Warrantholder, which consent shall not be unreasonably withheld; and PROVIDED
FURTHER, that the Warrantholder shall be liable under this Section 8(f)(ii) for
only that amount of a Claim as does not exceed the net proceeds to such
Warrantholder as a result of the sale of Warrant Shares pursuant to such
Registration Statement. Such indemnity shall remain in full force and effect
9
regardless of any investigation made by or on behalf of such Indemnified Party.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 8(f)(ii) with respect to any preliminary
prospectus shall not inure to the benefit of any Indemnified Party if the untrue
statement or omission of material fact contained in the preliminary prospectus
was corrected on a timely basis in the prospectus, as then amended or
supplemented.
(iii) The Company shall be entitled to receive indemnities from
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in any distribution, to the same extent as provided
above, with respect to information such persons so furnished in writing by such
persons expressly for inclusion in the Registration Statement.
(iv) Promptly after receipt by an Indemnified Party of notice of
the commencement of any action (including any governmental action), such
Indemnified Party shall, if a Claim in respect thereof is to be made against any
indemnifying party under this Section 8(f), deliver to the indemnifying party a
written notice of the commencement thereof and the indemnifying party shall have
the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying parties and the Indemnified Party; PROVIDED, however, that an
Indemnified Party shall have the right to retain its own counsel, with the fees
and expenses to be paid by the indemnifying party, if, in the reasonable written
opinion of counsel retained by the indemnifying party, the representation by
such counsel of the Indemnified Party and the indemnifying party would be
inappropriate due to actual or potential differing interests between such
Indemnified Party or other party represented by such counsel in such proceeding.
The Company shall pay for only one separate legal counsel for the
Warrantholders; such legal counsel shall be selected by the Warrantholders
holding a majority in interest of the shares of Common Stock issuable (or
issued) upon exercise of Series A Warrants that are included in Registration
Statement to which the claim relates. The failure to deliver written notice to
the indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
Indemnified Party under this Section 8(f), except to the extent that the
indemnifying party is prejudiced in its ability to defend such action. The
indemnification required by this Section 8(f) shall be made by periodic payments
of the amount thereof during the course of the investigation or defense, as such
expense, loss, damage or liability is incurred and is due and payable.
(g) CONTRIBUTION. To the extent any indemnification provided for
herein is prohibited or limited by law, the indemnifying party agrees to make
the maximum contribution with respect to any amounts for which it would
otherwise be liable under Section 8(f) to the fullest extent permitted by law;
PROVIDED, however, that (a) no contribution shall be made under circumstances
where the maker would not have been liable for indemnification under the fault
standards set forth in Section 8(f)(ii); (b) no seller of Warrant Shares guilty
of fraudulent misrepresentation (within the meaning of Section ll(f) of the
Securities Act) shall be entitled to contribution from any seller of Warrant
Shares who was not guilty of such fraudulent misrepresentation and (c)
contribution by any seller of Warrant Shares shall be limited in amount to the
net amount of proceeds received by such seller from the sale of such Warrant
Shares.
(h) REPORTS UNDER EXCHANGE ACT. With a view to making available to
the Warrantholders the benefits of Rule 144 or any other similar rule or
regulation of the SEC that may at any time permit the Warrantholders to sell
securities of the Company to the public without Registration, until such time as
the Warrantholders have sold all the Warrant Shares pursuant to a Registration
Statement or Rule 144, the Company agrees to:
(i) make and keep public information available, as those terms
are understood and defined in Rule 144;
(ii) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and
10
(iii) furnish to each Warrantholder so long as such
Warrantholder owns Warrants or Warrant Shares, promptly upon request, (i) a
written statement by the Company that it has complied with the reporting
requirements of Rule 144, the Securities Act and the exchange Act, (ii) a copy
of the most recent annual or quarterly report of the Company and such other
reports and documents so filed by the Company and (iii) such other information
as may be reasonably requested to permit the Warrantholder to sell such
securities pursuant to Rule 144 without Registration.
9. NOTICES. Any notices required or permitted to be given under the
terms of this Warrant shall be sent by certified or registered mail (return
receipt requested) or delivered personally or by courier or by confirmed
telecopy, and shall be effective five days after being placed in the mail, or
upon receipt or refusal of receipt, if delivered personally or by courier or
confirmed telecopy, in each case addressed to a party. The addressees for such
communications shall be:
If to the Company:
Universal Beverages Holding Corporation
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Leesburg Operation Center
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
and if to the holder, at such address as such holder shall have provided in
writing to the Company, or at such other address as each such party furnishes by
notice given in accordance with this Section 9.
10. GOVERNING LAW; JURISDICTION. This Warrant shall be governed by and
construed in accordance with the laws of the State of Florida applicable to
contracts made and to be performed in the State of Florida. The Company
irrevocably consents to the jurisdiction of the United States federal courts
located in Florida in any suit or proceeding based on or arising under this
Warrant and irrevocably agrees that all claims in respect of such suit or
proceeding may be determined in such courts. Nothing herein shall affect the
holder's right to serve process in any other manner permitted by law.
11. MISCELLANEOUS
(a) AMENDMENTS. This Warrant and any provision hereof may only be
amended by an instrument in writing signed by the Company and the holder hereof.
This Warrant replaces a previous warrant dated the same date ______ amended with
the consent of the holder.
(b) DESCRIPTIVE HEADINGS. The descriptive headings of the several
Sections of this Warrant are inserted for purposes of reference only, and shall
not affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer.
UNIVERSAL BEVERAGES HOLDING CORPORATION
By:
-----------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇, Vice President of Finance
11
AGREEMENT to EXERCISE WARRANT
(To be Executed by the Holder in order to Exercise the Warrant)
The undersigned hereby irrevocably exercises the right to purchase of
the shares of Common Stock of UNIVERSAL BEVERAGES HOLDING CORPORATION, a Florida
corporation (the "COMPANY"), evidenced by the attached Warrant, and herewith
makes payment of the Exercise Price with respect to such shares in full, all in
accordance with the conditions and provisions of said Warrant.
The undersigned agrees not to offer, sell, transfer or otherwise
dispose of any Common Stock obtained on exercise of the Warrant, except under
circumstances that will not result in a violation of the Securities Act of 1933,
as amended, or any state securities laws, and agrees that the following legend
may be affixed to the stock certificate for the Common Stock hereby subscribed
for if resale of such Common Stock is not registered or if Rule 144(k) is
unavailable:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER SAID ACT, OR AN
OPINION OF COUNSEL, IN FORM, SUBSTANCE AND SCOPE CUSTOMARY FOR OPINIONS OF
COUNSEL IN COMPARABLE TRANSACTIONS, THAT REGISTRATION IS NOT REQUIRED UNDER SAID
ACT OR UNLESS SOLD PURSUANT TO RULE 144(K) UNDER SAID ACT.
The undersigned requests that stock certificates for such shares be
issued, and a Warrant representing any unexercised portion hereof be issued,
pursuant to the Warrant in the name of the Holder and delivered to the
undersigned at the address set forth below:
Dated:
------------------- ------------------------------------
Signature of Holder
------------------------------------
Name of Holder (Print)
Address:
---------------------------
------------------------------------
ASSIGNMENT OF WARRANTS
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and
transfers all the rights of the undersigned under the within Warrant, with
respect to the number of shares of Common Stock covered thereby set forth
hereinbelow, to:
Name of Assignee Address No. of Shares
and hereby irrevocably constitutes and appoints ____________________ as agent
and attorney-in-fact to transfer said Warrant on the books of the within-named
corporation, with full power of substitution in the premises.
Dated:
-------------------------
In the presence of
Name:
-------------------------
Signature:
--------------------------------
Title of Signing Officer or
Agent (if any):
-------------------------------------------
Address:
----------------------------------
------------------------------------------
Note: The above signature should correspond exactly with the name on the face of
the within Warrant.
