EXHIBIT 10.26
BRIDGE LOAN WARRANT
THIS SECURITY AND ANY SHARES ISSUED UPON EXERCISE OF THIS SECURITY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS THE APPLICABLE SECURITY HAS BEEN REGISTERED UNDER THE ACT AND
SUCH LAWS OR (1) REGISTRATION UNDER SUCH LAWS IS NOT REQUIRED AND (2) AN OPINION
OF COUNSEL SATISFACTORY TO THE COMPANY IS FURNISHED TO THE COMPANY TO THE EFFECT
THAT REGISTRATION UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS IS NOT
REQUIRED.
AMERIGON INCORPORATED
WARRANT TO PURCHASE COMMON STOCK
This Warrant (the "Warrant") represents and certifies that, for value
received, Big Star Investments LLC, a Delaware limited liability company (the
"Holder") is entitled to subscribe for and purchase shares (subject to
adjustment from time to time pursuant to the provisions of Section 5 hereof) of
fully paid and nonassessable Class A Common Stock of Amerigon Incorporated, a
California corporation (the "Company"), of an amount up to 10% of the principal
amount of the Loans (as defined below) divided by the relevant Exercise Price
(as defined below) at the relevant Exercise Price specified in Section 2 hereof,
as such price may be adjusted from time to time pursuant to Section 5 hereof,
subject to the provisions and upon the terms and conditions hereinafter set
forth.
As used herein, the term "Loans" shall mean the $1.5 million bridge
facility (the "Initial Loans") to be advanced to Company by Holder pursuant to
the Credit Agreement, dated as of March __, 2000, between the Company and the
Holder (as amended or modified from time to time, the "Credit Agreement") and,
in the event the Holder makes or commits to make in its sole discretion
additional advances thereunder of up to an aggregate of $2.5 million in
principal amount of additional loans under the Credit Agreement (the "Additional
Loans"), shall also mean such principal amount of Additional Loans. The date
(if any) on which the Holder makes any Initial Loan or any Additional Loan is
referred to herein as a "Loan Date."
As used herein, the term "Class A Common Stock" shall mean the
Company's presently authorized Class A Common Stock, no par value, and any stock
into or for which such Common Stock may hereafter be converted or exchanged.
As used herein, the term "Exercise Price" shall mean, with respect to
the portion of this Warrant that is allocable to any Loan, the Market Price of
the Class A Common Stock as of the Loan Date of such Loan, provided that the
Exercise Price shall be subject to adjustment as provided in Section 5 hereof.
As used herein, the term "Market Price of the Class A Common Stock"
shall have the meaning set forth in Section 3(b) hereof.
1. TERM OF WARRANT.
a. TERM. The purchase right represented by this Warrant is exercisable,
in whole or in part, at any time during a period beginning on the date hereof
and s ending five years after such date, but shall not be exercisable as to the
portion of this Warrant allowable to any Loans unless the Loan Date with respect
thereto has occurred.
2. EXERCISE PRICE.
The Exercise Price shall be as provided in the definition of Exercise
Price, subject to adjustment from time to time pursuant to the provisions of
Section 5 hereof.
3. METHOD OF EXERCISE OR CONVERSION; PAYMENT; ISSUANCE OF NEW WARRANT.
a. EXERCISE. Subject to Section 1 hereof, the purchase right
represented by this Warrant may be exercised by the Holder, 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 cashier's check or wire transfer, of an amount
equal to the then applicable Exercise Price per share multiplied by the number
of shares then being purchased. The Company agrees that the shares so purchased
shall be deemed to be issued to the Holder as the record owner of such shares as
of the close of business on the date on which this Warrant shall have been
surrendered and payment made for such shares as aforesaid. In the event of any
exercise of this Warrant, certificates for the shares of stock so purchased
shall be delivered to the Holder within 15 business days thereafter 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 within such 15 business
day period.
b. CONVERSION. Subject to Section 1 hereof, the Holder may convert this
Warrant (the "Conversion Right"), in whole or in part, into the number of shares
(less the number of shares which have been previously exercised or as to which
the Conversion Right has been previously exercised) calculated pursuant to the
following formula by surrendering this Warrant (with the notice of exercise form
attached hereto as EXHIBIT 1 duly executed) at the principal office of the
Company specifying the number of shares the rights to purchase which the Holder
desires to convert:
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Y (A - B)
---------------
X - A
where: X = the number of shares of Class A Common Stock to
be issued to the Holder;
Y = the number of shares of Class A Common Stock
subject to this Warrant for which the Conversion
Right is being exercised;
A = the Market Price of the Class A Common Stock (as
defined below) as of the trading day immediately
preceding the date of exercise of this Warrant;
and
B = the Exercise Price
For purposes hereof, the "Market Price of the Class A Common Stock,"
with respect to the portion of this Warrant allocable to a particular
Loan, shall be (i) the average closing bid price of the Class A Common
Stock, for ten (10) consecutive business days ending on the Loan Date
of such Loan, as reported by Nasdaq, if the Class A Common Stock is
traded on the Nasdaq SmallCap Market, or (ii) the average last
reported sale price of the Class A Common Stock, for ten (10)
consecutive business days ending on such applicable Loan Date, as
reported by the primary exchange on which the Class A Common Stock is
traded, if the Class A Common Stock is traded on a national securities
exchange, or by Nasdaq, if the Class A Common Stock is traded on the
Nasdaq National Market.
The Company agrees that the shares so converted shall be deemed issued
to the Holder as the record owner of such shares as of the close of
business on the date on which this Warrant shall have been surrendered
as aforesaid. In the event of any conversion of this Warrant,
certificates for the shares of stock so converted shall be delivered
to the holder hereof within 15 business days thereafter and, unless
this Warrant has been fully converted or expired, a new Warrant
representing the portion of the shares, if any, with respect to which
this Warrant shall not then have been converted, shall also be issued
to the holder hereof within such 15-day period.
4. STOCK FULLY PAID; RESERVATION OF SHARES.
All Class A Common Stock which may be issued upon the exercise of the
rights represented by this Warrant will, upon issuance, be fully paid and
nonassessable, and free from all United States 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 issuance upon exercise of the
purchase rights evidenced by this Warrant, a sufficient number of shares of its
Class A Common Stock to provide for the exercise of the rights represented by
this Warrant.
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5. ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF SHARES.
a. ADDITIONAL SHARES. In the event that the Company shall issue
additional shares of Class A Common Stock, or other securities exchangeable for,
exercisable for, or convertible into additional shares of Class A Common Stock,
in each case in an equity offering in excess of $5 million, for consideration
per share less than the Exercise Price relating to a portion of this Warrant
allocable to a particular Loan on the date of and immediately prior to any such
issue, then and in such event, the per share Exercise Price relating to the
portion of this Warrant allocable to such Loan shall be reduced concurrently
with such issuance or sale, to a price equal to the consideration per share of
such issuance; provided that such Exercise Price shall not be so reduced at such
time if the amount of such reduction would be an amount less than $0.01, but any
such amount shall be carried forward and reduction with respect thereto made at
the time of and together with any subsequent reduction which, together with such
amount and any other amount or amounts so carried forward, shall aggregate $0.01
or more. No adjustment in the Exercise Price shall be made on account of (i) the
grant of options exercisable for, or sales of, Class A Common Stock pursuant to
employee benefit plans previously approved by the Company's shareholders, (ii)
the issuance of stock, warrants or other securities or rights to persons or
entities with which the Company has business relationships provided such
issuances are for other than primarily equity financing purposes and provided
that (x) any such issuance does not exceed 2% of the then outstanding Class A
Common Stock of the Company (assuming full conversion and exercise of all
convertible and exercisable securities) and (y) the aggregate of all such
issuances since the date of this Warrant do not exceed 5% of the then
outstanding Class A Common Stock of the Company (assuming full conversion and
exercise of all convertible and exercisable securities).
b. STOCK SPLITS AND COMBINATIONS. If the Company at any time or from
time to time after the date this Warrant is issued effects a subdivision of the
outstanding Class A Common Stock pursuant to a stock split or similar event, the
Exercise Price shall be proportionately decreased, and conversely, if the
Company at any time or from time to time after the date this Warrant is issued
combines the outstanding shares of Class A Common Stock into a smaller number of
shares in a reverse stock split or similar event, the Exercise Price shall be
proportionately increased. Upon the adjustment of the Exercise Price pursuant to
the foregoing provisions, the number of shares of Class A Common Stock subject
to the exercise of the Warrant shall be adjusted to the nearest full share by
multiplying the shares subject to the Warrant by a fraction, the numerator of
which is the Exercise Price immediately prior to such adjustment and the
denominator of which is the Exercise Price immediately after such adjustment.
Any adjustment under this subsection (b) shall be effective at the close of
business on the date the subdivision or combination becomes effective.
c. CERTAIN DIVIDENDS AND DISTRIBUTIONS. If the Company at any time or
from time to time after the date this Warrant is issued makes, or fixes a record
date for the determination of holders of Class A Common Stock entitled to
receive a dividend or other distribution payable in additional shares of Class A
Common Stock, then and in each such event the number of shares of Class A Common
Stock subject to the Warrant shall be increased and the Exercise Price then in
effect shall be decreased as of the date of such issuance or, in the event such
record date is fixed, as of the close of business on such record date, by:
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(i) multiplying the Exercise Price then in effect by a
fraction (1) the numerator of which is the total number of shares of Class
A Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date, and (2) the
denominator of which shall be the total number of shares of Class A Common
Stock issued and outstanding immediately prior to the time of such issuance
or the close of business on such record date plus the number of shares of
Class A Common Stock issuable in payment of such dividend or distribution;
and
(ii) multiplying the number of shares of Class A Common Stock
subject to the Warrant by a fraction (1) the numerator of which is the
total number of shares of Class A Common Stock issued and outstanding
immediately prior to the time of such issuance or the close of business on
such record date plus the number of shares of Class A Common Stock issuable
in payment of such dividend or distribution, and (2) the denominator of
which shall be the total number of shares of Class A Common Stock issued
and outstanding immediately prior to the time of such issuance or the close
of business on such record date.
If, however, such record date is fixed and such dividend is not fully
paid or if such distribution is not fully made on the date fixed therefor, the
number of shares of Class A Common Stock subject to the Warrant and the Exercise
Price thereof shall be recomputed accordingly as of the close of business on
such record date and thereafter shall be adjusted pursuant to this subsection(c)
as of the time of actual payment of such dividends or distributions.
d. OTHER ADJUSTMENTS. In the event the Company at any time or from
time to time after the date this Warrant is issued:
(i) makes a dividend or other distribution payable in
securities of the Company other than shares of Class A Common Stock, or
(ii) changes any Class A Common Stock into the same or a
different number of shares of any class or classes of stock, whether by
recapitalization, reclassification or otherwise (other than a subdivision
or combination of shares or stock dividend or a reorganization, merger,
consolidation or sale of assets provided for elsewhere in this Section 5),
or
(iii) effects a capital reorganization of the Class A Common
Stock (other than a recapitalization, subdivision, combination,
reclassification or exchange of shares provided for elsewhere in this
Section 5) or merger or consolidation of the Company with or into another
corporation, or the sale of all or substantially all of the Company's
properties and assets to any other person,
then, in each such event, any and all new, substituted or additional
securities to which Holder is or would be entitled by reason of its ownership of
the shares underlying this Warrant shall be immediately subject to the Warrant
and be included in the shares underlying this Warrant for all purposes
hereunder. After each such event, the Exercise Price per share shall be
proportionately adjusted so that the aggregate Exercise Price upon exercise of
the Warrant shall remain the same as before such event.
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6. NOTICE OF ADJUSTMENTS.
Whenever any Exercise Price shall be adjusted pursuant to Section 5
hereof, the Company shall prepare 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, the Exercise Price after giving effect to such adjustment and the
number of shares then purchasable upon exercise of this Warrant, 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 Section 9(c) hereof, or
at such other address as may be provided to the Company in writing by the Holder
of this Warrant.
7. FRACTIONAL SHARES.
No fractional shares of Class A Common Stock will be issued in
conjunction with any exercise hereunder, but in lieu of such fractional shares
the Company shall make a cash payment therefore on the basis of the Exercise
Price then in effect.
8. COMPLIANCE WITH SECURITIES ACT.
The Holder of this Warrant, by acceptance hereof, agrees that this
Warrant and the shares of Class A Common Stock to be issued on exercise hereof
are being acquired for investment and that it will not offer, sell or otherwise
dispose of this Warrant or any shares of Class A 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"). This Warrant and all
shares of Class A Common Stock issued upon exercise of this Warrant (unless
registered under the Act) shall be stamped and imprinted with a legend
substantially in the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "ACT"), OR APPLICABLE STATE SECURITIES LAWS AND
MAY NOT BE TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS IT HAS BEEN
REGISTERED UNDER THE ACT AND SUCH LAWS OR (1) REGISTRATION UNDER SUCH LAWS
IS NOT REQUIRED AND (2) AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
IS FURNISHED TO THE COMPANY TO THE EFFECT THAT REGISTRATION UNDER THE ACT
AND THE APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED."
9. MISCELLANEOUS.
a. NO RIGHTS AS SHAREHOLDER. The Holder of this Warrant shall not
be entitled to vote or receive dividends or be deemed the Holder of Class A
Common Stock or any other securities of the Company that 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
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dividends or subscription rights or otherwise until the Warrant 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 mutilation, on surrender and cancellation of this Warrant, the
Company, at the Holder's 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 Warrant shall be
in writing, and any notice hereunder shall be deemed to have been given upon the
earlier of delivery thereof by hand delivery, by courier, or by standard form of
telecommunication or three (3) business days after the mailing thereof in the
U.S. mail if sent registered mail with postage prepaid, addressed to the Company
at its principal executive offices and to the Holder at its address set forth in
the Company's books and records or at such other address as the Holder may have
provided to the Company in writing.
d. GOVERNING LAW. This Warrant shall be governed and construed under the
laws of the State of California.
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This Warrant is executed as of this ___th day of March, 2000.
AMERIGON INCORPORATED
By:___________________________________
Name: Richard A. Weisbart
--------------------------------
Title: President & CEO
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