THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND HAS BEEN TAKEN FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO
THE DISTRIBUTION THEREOF, AND THIS WARRANT MAY NOT BE SOLD OR TRANSFERRED UNLESS
THERE IS AN EFFECTIVE REGISTRATION STATEMENT COVERING IT OR THE COMPANY RECEIVES
AN OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE COMPANY) FROM THE TRANSFEROR
REASONABLY ACCEPTABLE TO IT STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM
THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.
No. Warrant to Purchase 295,056 Shares
-------------- of Common Stock (subject to adjustment)
Date: October 15, 1997
WARRANT
TO PURCHASE COMMON STOCK OF DCX, INC.
This certifies that, in consideration of value heretofore received by DCX,
INC., a Colorado corporation (the "Company") receipt of which is hereby
acknowledged, ▇▇▇▇▇▇▇▇ CONSULTING GROUP, INC., ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Holder") is entitled to subscribe for and purchase up to
295,056 shares of fully paid and nonassessable Common Stock of the Company, at
the price of $1.00 per share, as adjusted pursuant to Paragraph 4 hereof (the
"Warrant Price"), subject to the provisions and upon the terms and conditions
hereinafter set forth.
As used herein, the term "Common Stock" shall mean the Company's presently
authorized Common Stock and any stock into which such Common Stock may hereafter
be exchanged.
1. TERM.
The purchase right represented by this Warrant is exercisable, in whole or
in part at any time following the date hereof until JANUARY 14, 2002.
2. METHOD OF EXERCISE; PAYMENT: ISSUANCE OF NEW WARRANT.
Subject to paragraph I hereof, the purchase right represented by this
Warrant may be exercised by the holder hereof, in whole or in part, by the
surrender of this Warrant (with the notice of exercise form attached hereto as
Exhibit 1 duly executed) at the principal office of the Company and by the
payment to the Company, by either: (a) a check, of an amount equal to the then
applicable Warrant Price per share multiplied by the number of shares of common
stock then being purchased; or (b) that number of shares of common stock of the
Company having a fair market value equal to the then applicable warrant price
per share multiplied by the number of shares of common stock then being
purchased. In the event of any exercise of the rights represented by this
Warrant, certificates for the shares of stock so purchased shall be delivered to
the Holder hereof within five (5) business days and, unless this Warrant has
been fully exercised or expired, a new Warrant representing the portion of the
shares, if any, with respect to which this Warrant shall not then have been
exercised shall also be issued to the Holder hereof within such reasonable time.
3. STOCK FULLY PAID, RESERVATION OF SHARES.
All Common Stock which may be issued upon the exercise of the rights
represented by this Warrant ("Warrant Stock") will, upon issuance, be fully paid
and nonassessable, and free from all taxes, liens and charges with respect to
the issue thereof. During the period within which the rights represented by this
Warrant may be exercised, the Company will at all times have authorized, and
reserved for the purpose of the issue upon exercise of the purchase rights
evidenced by this Warrant, a sufficient number of shares of its Common Stock to
provide for the exercise of the rights represented by this Warrant.
4. ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF SHARES.
If there shall be any change described in sub-paragraphs (a), (b) or ( c)
below, the aggregate Warrant Price shall remain unchanged but the number of
shares covered by this Warrant shall in each instance be adjusted as follows:
a. If a share dividend is declared on the Common Stock of the Company, the
number of shares of Common Stock subject to this Warrant shall be increased by
the number of shares which would have been issuable to the Holder if such Holder
had exercised this Warrant immediately prior to the record date related to the
declaration and payment of such share dividend;
b. If an increase or decrease is effected in the number of outstanding
shares of Common Stock by reason of subdivision or combination of such shares,
the number of shares of Common Stock subject to this Warrant shall equal the
number of shares which would have been held by the Holder after consummation of
such combination or subdivision if the Holder had exercised this Warrant
immediately prior to the record date related to such subdivision or combination
and the Holder held no other shares of Common Stock other than those deemed
issued upon exercise of this Warrant; and
c. In case of a capital reorganization, merger (except a merger in which
the Company is the surviving corporation), or the sale of all or substantially
all of the properties and assets of the Company (each of the foregoing is
sometimes hereinafter referred to as a "Reorganization"), the securities or any
other property to be received upon exercise of this Warrant shall be the
securities and other property which would have been held by the Holder after
consummation of such Reorganization if the Holder had exercised this Warrant
immediately prior to the record date related to such Reorganization and the
Holder held no other shares of Common Stock other than those deemed issued upon
exercise of this Warrant. Notwithstanding anything herein to the contrary, in
the case of a Reorganization which qualifies for adjustment under this
subparagraph ( c), the Holder must exercise this Warrant (or agree to exercise
this Warrant) within ninety (90) days after written notice of the execution of
the definitive agreement with the acquiror is delivered by the Company or the
acquiror to the Holder.
5. NOTICE OF ADJUSTMENTS.
Whenever any Warrant Price shall be adjusted pursuant to Paragraph 4
hereof, the Company shall issue a certificate signed by its chief financial
officer setting forth, in reasonable detail, the event requiring the adjustment,
the amount of the adjustment, the method by which such adjustment was
calculated, and the Warrant Price or Prices after giving effect to such
adjustment, and shall cause copies of such certificate to be mailed (by first
class mail, postage prepaid) to the Holder of this Warrant at the address
specified in Paragraph 10(c) hereof, or at any address provided to the Company
in writing by the Holder of this Warrant.
6. FRACTIONAL SHARES.
No fractional shares of Common Stock will be issued in connection with any
exercise hereunder, but in lieu of such fractional shares the Company shall make
a cash payment therefor upon the basis of the Warrant Price then in effect.
7. COMPLIANCE WITH SECURITIES ACT-, NON-TRANSFERABILITY OF WARRANT-,
DISPOSITION OF SHARES OF COMMON STOCK.
COMPLIANCE WITH SECURITIES ACT. The Holder of this Warrant, by acceptance
hereof, agrees that this Warrant and the shares of Common Stock to be issued
upon exercise hereof are being acquired for investment and that it will not
offer, sell or otherwise dispose of this Warrant or any shares of Common Stock
to be issued upon exercise hereof except under circumstances which will not
result in a violation of the Securities Act of 1933, as amended (the "Act").
Upon exercise of this Warrant, the Holder hereof shall, if requested by the
Company, confirm in writing, in a form satisfactory to the Company, that the
shares of Common Stock so purchased are being acquired for investment and not
with a view toward distribution or resale. This Warrant and all shares of Common
Stock issued upon exercise of this Warrant (unless registered under the Act)
shall be stamped or imprinted with a legend substantially in the following form:
"THE SECURITIES REPRESENTED BY THIS WARRANT HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS
THE REGISTRATION PROVISIONS OF SUCH ACT HAVE BEEN COMPLIED WITH OR UNLESS
THE COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT
THAT THE PROPOSED TRANSACTION WILL NOT VIOLATE FEDERAL OR STATE SECURITIES
LAWS."
8. REGISTRATION OF SHARES OF COMMON STOCK UNDERLYING WARRANTS.
8.1 REGISTRATION. The Company shall use reasonable efforts to prepare and
file a registration statement (the "statement") under the Act, to the extent the
Company can qualify to file such a statement, and thereafter continue to use its
best efforts to make effective, a registration statement covering the shares of
Warrant Stock issued or issuable pursuant to the Warrants requested to be sold
by such Holders (Holders may only make the demand one time during the term of
the Warrant), and in connection therewith shall advise the persons entitled
thereto of their rights under Section 8 hereof.
8.2 NOTICE. In connection with the filing of a registration statement
pursuant to this Section, the Company shall:
(a) promptly notify such Holders as to the anticipated filing thereof and
of all amendments thereto filed prior to the effective date of said registration
statement which notice briefly describes the Holders' rights under this Section
8;
(b) use its best efforts to include in such registration (and any related
filing or qualification under applicable blue sky laws), and in any underwriting
involved therein, all the shares of Warrant Stock specified in a written request
or requests, made by any Holder and received by the Company within twenty (20)
days after the written notice from the Company described in clause (a) above is
mailed or delivered by the Company. Such written request may specify all or a
part of a Holder's shares of Warrant Stock.
(c) UNDERWRITING. If the registration of which the Company gives notice is
for a registered public offering involving an underwriting, the Company shall so
advise the Holders as part of the written notice given pursuant to clause (a).
In such event, the right of any Holder to registration pursuant to this Section
8 shall be conditioned upon such Holder's participation in such underwriting and
the inclusion of such Holder's shares of Warrant Stock in the underwriting to
the extent provided herein. All such Holders proposing to distribute their
securities through such underwriting shall (together with the Company and the
other holders of securities of the Company with registration rights to
participate therein distributing their securities through such underwriting)
enter into an underwriting agreement in customary form with the representative
of the underwriter or underwriters selected by the Company.
(d) notify such Holders promptly after it shall have -received notice of
the time when the registration statement becomes effective or any supplement to
any prospectus forming a part of the registration statement has been filed;
(e) prepare and file without expense to such Holders any necessary
amendment or supplement to such registration statement or prospectus as may be
necessary to comply with Section 10(a)(3) of the Act or advisable in connection
with the proposed distribution of the securities by such Holders;
(f) take all reasonable steps to qualify the shares of Warrant Stock for
sale under the securities or blue sky laws of states as such Holders may
designate in writing and to register or obtain the approval of any federal or
state authority which may be required in connection with the proposed
distribution, except, in each case, in jurisdictions in which the Company must
either qualify to do business or file a general consent to service of process as
a condition to the qualification of such securities;
(g) notify such Holders of any stop order suspending the effectiveness of
the registration statement and use its reasonable best efforts to remove such
stop order;
(h) use its best efforts to keep such registration statement and prospectus
effective for a period of five (5) years after its effective date; and
(i) furnish to such Holders as soon as available, copies of any such
registration statement and each preliminary or final prospectus and any
supplement or amendment required to be prepared pursuant to the foregoing
provisions of this Section 8, all in such quantities as such Holders may from
time to time reasonably request.
9. EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT.
Subject to the provisions of Section 7 hereof, this Warrant is
exchangeable, without expense, at the option of the Holder, upon presentation
and surrender hereof to the Company or at the office of its stock transfer
agent, if any, for other warrants of different denominations, entitling the
Holder or Holders thereof to purchase in the aggregate the same number of shares
of Warrant Stock purchasable hereunder. Upon surrender of this Warrant to the
Company or at the office of its stock transfer agent, if any, with the
Assignment Form annexed hereto duly executed and funds sufficient to pay any
transfer tax, the Company shall, without charge, execute and deliver a new
Warrant in the name of the assignee named in such instrument of assignment and
this Warrant shall promptly be canceled. This Warrant may be divided or combined
with other Warrants that carry the same rights upon presentation hereof at the
office of the Company or at the office of its stock transfer agent, if any,
together with a written notice specifying the names and denominations in which
new Warrants are to be issued and signed by the Holder hereof.
10. MISCELLANEOUS.
(a) NO RIGHTS AS SHAREHOLDER. No Holder of the Warrant or Warrants shall be
entitled to vote or receive dividends or be deemed the Holder of Common Stock or
any other securities of the Company which may at any time be issuable on the
exercise hereof for any purpose, nor shall anything contained herein be
construed to confer upon the Holder of this Warrant, as such, any of the rights
of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action (whether upon any
recapitalization, issuance of stock, reclassification of stock, change of par
value or change of stock to no par value, consolidation, merger, conveyance, or
otherwise) or to receive notice of meetings, or to receive dividends or
subscription rights or otherwise until the Warrant or Warrants shall have been
exercised and the Shares purchasable upon the exercise hereof shall have become
deliverable, as provided herein.
(b) REPLACEMENT. 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 any indemnity agreement
or bond 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, will execute and deliver. in lieu of this Warrant, a new Warrant
of like tenor.
(c) NOTICE. Any notice given to either party under this Agreement shall be
deemed to be given three (3) days after mailing, postage prepaid, addressed to
such parry at the address as such party may provide to the other.
(d) NO IMPAIRMENT. The Company will not, by amendment of its Certificate of
Incorporation 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 hereunder by the Company, but will at all times in good
faith assist in the carrying, out of all the provisions in this Warrant.
(e) GOVERNING Law. This Warrant shall be governed by and construed under
the laws of the State of Colorado without regard to principles of conflicts of
laws. Any action or proceeding brought by the Holder or the Company against the
other arising out of or related to this Warrant shall be brought in a State or
Federal Court of competent jurisdiction located in Denver, Colorado and the
Holder and the Company hereby submit to the jurisdiction of such courts for the
purposes of any such action or proceeding.
(f) The Company shall at all times during the term of this Warrant reserve
and keep available such number of shares of its Common Stock as will be
sufficient to satisfy the requirements of this Warrant.
(g) This Warrant shall be binding upon the Company's successors and
assigns.
(h) The Holder agrees that he will comply with all applicable laws, rules
and regulations of all Federal and State securities regulators including but not
limited to the Securities and Exchange Commission, the National Association of
Securities Dealers and applicable state securities regulators with respect to
disclosure, filings and any other requirements resulting in any way from the
issuance of this Warrant.
IN WITNESS WHEREOF, the parties have signed this Warrant.
DATED: As of October 15, 1997
DCX INC.
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President, Finance
HOLDER:
▇▇▇▇▇▇▇▇ CONSULTING GROUP, INC.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
EXHIBIT 1
NOTICE OF EXERCISE
TO: DCX INC.
1. The undersigned hereby elects to purchase shares of Common
----------
Stock of DCX, INC. pursuant to the terms of the attached Warrant, and tenders
herewith payment of the purchase price of such shares in full.
2. Please issue a certificate or certificates representing said shares of
Common Stock in the name of the undersigned or in such other name as is
specified below:
------------------------------------
(Name)
------------------------------------
------------------------------------
(Address)
3. The undersigned represents that the aforesaid shares of Common Stock are
being acquired for the account of the undersigned for investment and not with a
view to, or for resale in connection with, the distribution thereof and that the
undersigned has no present intention of distributing or reselling such shares.
In support thereof, the undersigned agrees to execute an Investment
Representation Statement in the form attached as Exhibit A.
EXHIBIT A
INVESTMENT REPRESENTATION STATEMENT
TO: DCX, INC.
With respect to the shares of Common Stock ("Shares") of DCX,
---------------
INC. ("Company") which the undersigned ("Purchaser") has purchased from the
Company today, the Purchaser hereby represents and warrants as follows:
1) The Purchaser acknowledges that he has received no formal prospectus or
offer in memorandum describing the business and operations of the Company. He
has, however, by virtue of his relationship with the Company, been given access
to all information that he believes is material to his decision to purchase the
Shares. The Purchaser has had the opportunity to ask questions of, and receive
answers from, representatives of the Company concerning its business operations.
Any questions raised by the Purchaser have been answered to his satisfaction.
2) The Shares are being acquired by the Purchaser for his account, for
investment purposes only, and not with a view to the distribution or resale
thereof.
3) No representations or promises have been made concerning the
marketability or value of the Shares. The Purchaser understands that there is
currently no market for the transfer of the Shares. The Purchaser further
acknowledges that, because the Shares have not been registered under the
Securities Act of 1933, or applicable state securities laws and cannot be resold
unless and cannot be resold unless they are subsequently registered under said
Act or applicable state securities laws, or an exemption from registration is
available, the Purchaser must continue to bear the economic risk of his
investment in the Shares for an indefinite period of time. Specifically, the
Purchaser agrees that the Shares may not be transferred until the Company has
received an opinion of counsel reasonably satisfactory to it that the proposed
transfer will not violate federal or state securities laws. The Company has not
agreed or represented to the Purchaser that the Shares will be purchased or
redeemed from the Purchaser at any time in the future. The Purchaser further
understands that a notation will be made on the appropriate records of the
Company and on the stock certificate representing the Shares so that the
transfers of Shares will not be effected on those records without compliance
with the restrictions referred to above.
Date:
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