EXHIBIT 4.2
FORM OF
WARRANT
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NEITHER THE WARRANT EVIDENCED OR CONSTITUTED HEREBY, THE SHARES OF 6% SERIES A
CUMULATIVE CONVERTIBLE SERIES A PREFERRED STOCK ISSUABLE UPON THE EXERCISE
HEREOF, NOR THE SHARES OF COMMON STOCK ISSUABLE UPON THE CONVERSION OF SUCH
PREFERRED STOCK, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR UNDER THE SECURITIES LAWS OF ANY STATES.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND
MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT
AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM.
WARRANT TO PURCHASE SERIES A PREFERRED OF
TRAVIS BOATS & MOTORS, INC.
Date March __, 2002
This Certifies That, for value received, TMRC, L.L.P., or its permitted
registered assigns ("Holder"), is entitled, subject to the terms and conditions
of this Warrant, at any time or from time to time after [EFFECTIVE DATE] (the
"Effective Date"), and before 5:00 p.m. Pacific Time on [5 YEARS AFTER THE
EFFECTIVE DATE] (the "Expiration Date") unless earlier terminated in accordance
with Section 8 hereof, to purchase from Travis Boats & Motors, Inc., a Texas
corporation (the "Company") up to 30,000 shares of Series A Preferred (as
defined below) of the Company, at a price per share of $100.00 (the "Purchase
Price"). The conversion price of the Series A Preferred purchasable upon
exercise of this Warrant is subject to adjustment and change as provided herein.
This Warrant is issued pursuant to the Series A Preferred and Warrant Purchase
Agreement, dated as of the Effective Date, between the Company and the initial
Holder (the "Purchase Agreement").
1. CERTAIN DEFINITIONS. As used in this Warrant the following terms
shall have the following respective meanings:
1.1. "Business Day" means any day that is not a Saturday, a Sunday
or any day on which banks in the State of Missouri or Texas are authorized or
obligated to close.
1.2. "Common Stock" means the common stock of the Company, par value
$0.01 per share, and shall also include (a) any capital stock or other
securities of the Company into which Common Stock is changed, including by way
of a reclassification, combination or subdivision, and (b) any other securities
at any time receivable or issuable upon conversion of the Series A Preferred.
1.3. "Effective Date" shall have the meaning set forth in the
Preamble of this Warrant.
1.4. "Exercise Amount" shall have the meaning set forth in Section
2.1(b) of this Warrant.
1.5. "Expiration Date" shall have the meaning set forth in the
Preamble of this Warrant.
1.6. "Holder" shall have the meaning set forth in the Preamble of
this Warrant.
1.7. "Notice of Exercise" shall have the meaning set forth in
Section 2.1 of this Warrant.
1.8. "Purchase Agreement" shall have the meaning set forth in the
Preamble of this Warrant.
1.9. "Series A Conversion Price" shall mean the "Conversion Price"
set forth in the Statement of Designations.
1.10. "Series A Preferred" shall mean the 6% Series A Cumulative
Convertible Series A Preferred of the Company, par value $0.01 per share.
1.11. "Statement of Designations" means the Statement Of
Designations of 6% Series A Cumulative Convertible Series A Preferred of Travis
Boats & Motors, Inc. filed with the Secretary of State of the State of Texas.
1.12. "Suspension Period" shall have the meaning set forth in
Section 8(b) of this Warrant.
1.13. "Warrant" as used herein, shall include this Warrant and any
warrant delivered in substitution or exchange therefor as provided herein.
2. EXERCISE OF WARRANT
2.1. Payment. Subject to Sections 8 and 19 of this Warrant, this
Warrant may be exercised, in whole or in part at any time or from time to time,
on or before the Expiration Date by the delivery (including, without limitation,
delivery by facsimile) of the form of Notice of Exercise attached hereto as
Exhibit 1 (the "Notice of Exercise"), duly executed by the Holder, at the
principal office of the Company, and as soon as practicable after such date,
surrendering
(a) this Warrant at the principal office of the Company, and
(b) payment in cash by wire transfer of an amount equal to the
product obtained by multiplying the number of shares of Series A Preferred being
purchased upon such exercise by the then effective Purchase Price (the "Exercise
Amount").
2.2. Stock Certificates; Fractional Shares. As soon as practicable
on or after the date of any exercise of this Warrant, the Company shall issue
and deliver to the person or persons entitled to receive the same a certificate
or certificates for the number of whole shares of Series A Preferred issuable
upon such exercise, rounded up to the nearest whole number of shares. No
fractional shares or scrip representing fractional shares shall be issued upon
an exercise of this Warrant.
2.3. Partial Exercise; Effective Date of Exercise. Subject to
Section 19 of this Warrant, in case of any partial exercise of this Warrant, the
Company shall cancel this Warrant upon surrender hereof and shall execute and
deliver a new Warrant of like tenor and date for the balance of the shares of
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Series A Preferred purchasable hereunder. This Warrant shall be deemed to have
been exercised immediately prior to the close of business on the date of
effectiveness set forth in any notice of exercise delivered to the Company. The
person entitled to receive the shares of Series A Preferred issuable upon
exercise of this Warrant shall be treated for all purposes as the holder of
record of such shares as of the close of business on the date the Holder is
deemed to have exercised this Warrant.
3. VALID ISSUANCE; TAXES. All shares of Series A Preferred issued upon
the exercise of this Warrant shall be validly issued, fully paid and
non-assessable, and the Company shall pay all taxes and other governmental
charges that may be imposed in respect of the issue or delivery thereof.
4. ADJUSTMENT OF CONVERSION PRICE. The Series A Conversion Price of
shares of Series A Preferred issuable upon exercise of this Warrant shall be
adjusted in accordance with Section 6(d) of the Statement of Designations.
5. LOSS OR MUTILATION. Upon receipt of evidence reasonably satisfactory
to the Company of the ownership of and the loss, theft, destruction or
mutilation of this Warrant, and of indemnity reasonably satisfactory to it, and
(in the case of mutilation) upon surrender and cancellation of this Warrant, the
Company will execute and deliver in lieu thereof a new Warrant of like tenor as
the lost, stolen, destroyed or mutilated Warrant.
6. RESERVATION OF SERIES A PREFERRED. The Company hereby covenants that
at all times there shall be reserved for issuance and delivery upon exercise of
this Warrant such number of shares of Series A Preferred and, from time to time,
will take all steps necessary to amend its Certificate of Incorporation to
provide sufficient reserves of shares of Series A Preferred issuable upon
exercise of this Warrant. All such shares shall be duly authorized, and when
issued upon such exercise, shall be validly issued, fully paid and
non-assessable, free and clear of all liens, security interests, charges and
other encumbrances or restrictions on sale and free and clear of all preemptive
rights, except encumbrances or restrictions arising under federal or state
securities laws. Issuance of this Warrant shall constitute full authority to the
Company's officers who are charged with the duty of executing stock certificates
to execute and issue the necessary certificates for shares of Series A Preferred
upon the exercise of this Warrant.
7. TRANSFER AND EXCHANGE. Prior to or on June 10, 2002, this Warrant
may be transferred only to any parent, subsidiary or affiliate of Holder, and,
prior to or on such date, may not be transferred to any other party without the
prior written consent of the Company. Subject to the foregoing, the terms and
conditions of this Warrant and compliance with all applicable securities laws,
this Warrant and all rights hereunder may be transferred, in whole or in part,
on the books of the Company maintained for such purpose at the principal office
of the Company referred to above, by the Holder hereof in person, or by duly
authorized attorney, upon surrender of this Warrant properly endorsed and upon
payment of any necessary transfer tax or other governmental charge imposed upon
such transfer. Upon any permitted partial transfer, the Company will issue and
deliver to the Holder a new Warrant or Warrants with respect to the shares of
Series A Preferred not so transferred. Each taker and holder of this Warrant, by
taking or holding the same, consents and agrees that when this Warrant shall
have been so endorsed, the person in possession of this Warrant may be treated
by the Company, and all other persons dealing with this Warrant, as the absolute
owner hereof for any purpose and as the person entitled to exercise the rights
represented hereby, any notice to the contrary notwithstanding; provided,
however that until a transfer of this Warrant is duly registered on the books of
the Company, the Company may treat the Holder hereof as the owner for all
purposes.
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8. SUSPENSION AND TERMINATION OF THE WARRANT.
(a) Brunswick Note Acquired by Holder. Upon the acquisition by the
Holder of the Brunswick Note or the Brunswick Note holder's rights thereunder,
and for so long as the Holder retains the Brunswick Note or such rights, the
Holder shall be precluded from exercising all or a portion of this Warrant
unless the Holder agrees, concurrent with the delivery of any Notice of Exercise
by the Holder to the Company, to (a) waive any rights it may have under the
Brunswick Note to convert the Brunswick Note into shares of the Company's Common
Stock, and (b) delete the provisions in the Brunswick Note relating to
conversion of the Brunswick Note into shares of the Company's Common Stock. This
Warrant Agreement shall terminate immediately upon the conversion of the
Brunswick Note by the Holder.
(b) Termination of Warrant Due to Failure by Holder. This Warrant shall
terminate if the Company's inability to prepay the Brunswick Note in accordance
with the Prepayment Notice (as such term is defined by the Purchase Agreement)
prior to or on June 10, 2002 is attributable solely to a breach by Holder of its
obligation with respect to its exercise of the Warrant and to deposit into
escrow the entire exercise price therefor as contemplated by the parties hereto
in that certain escrow agreement described in Section 2.2 of the Purchase
Agreement.
9. NO RIGHTS OR LIABILITIES AS STOCKHOLDERS. This Warrant shall not
entitle the Holder to any voting rights or other rights as a stockholder of the
Company. In the absence of affirmative action by such Holder to purchase Series
A Preferred by exercise of this Warrant, no provisions of this Warrant, and no
enumeration herein of the rights or privileges of the Holder hereof shall cause
such Holder hereof to be a stockholder of the Company for any purpose.
10. NOTICES. Except as may be otherwise provided herein, all notices,
requests, waivers and other communications made pursuant to this Agreement shall
be in writing and shall be conclusively deemed to have been duly given (a) when
hand delivered to the other party; (b) when received when sent by facsimile at
the address and number set forth below; (c) three (3) business days after
deposit in the U.S. mail with first class or certified mail receipt requested
postage prepaid and addressed to the other party as set forth below; or (d) the
next business day after deposit with a national overnight delivery service,
postage prepaid, addressed to the parties as set forth below with
next-business-day delivery guaranteed, provided that the sending party receives
a confirmation of delivery from the delivery service provider.
To Holder: To the Company:
TMRC, L.L.P. c/o Travis Boats & Motors, Inc.
Tracker Marine, L.L.C. 5000 Plaza of the Lake, Suite 250
2500 East Kearney Street Austin, Texas 78746
Springfield, Missouri 65803 Attn: Mark T. Walton
Attn: Ken Burroughs Fax Number: (512) 329-0480
Fax Number: (417) 873-5052
With copies to: With copies to:
Greene & Curtis, L.L.P. Jenkens & Gilchrist, PC
1340 East Woodhurst Drive 2200 One American Center
Springfield, Missouri 65804 600 Congress Avenue
Attn: Joseph C. Greene, Esq. Austin, Texas 78701
Fax Number: (417) 883-4317 Attn: J. Rowland Cook, Esq.
Fax Number: (512) 404-3520
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Each person making a communication hereunder by facsimile shall promptly confirm
by telephone to the person to whom such communication was addressed each
communication made by it by facsimile pursuant hereto but the absence of such
confirmation shall not affect the validity of any such communication. A party
may change or supplement the addresses given above, or designate additional
addresses, for purposes of this Section 9 by giving the other party written
notice of the new address in the manner set forth above.
11. HEADINGS. The headings in this Warrant are for purposes of
convenience in reference only, and shall not be deemed to constitute a part
hereof.
12. LAW GOVERNING. This Warrant shall be construed and enforced in
accordance with, and governed by, the laws of the State of Delaware.
13. NO IMPAIRMENT. The Company will not, by amendment of its
Certificate of Incorporation or bylaws, or through reorganization,
consolidation, merger, dissolution, issue or sale of securities, sale of assets
or any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times in good
faith assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the
Holder of this Warrant against impairment. Without limiting the generality of
the foregoing, the Company (a) will not increase the par value of any shares of
stock issuable upon the exercise of this Warrant above the amount payable
therefor upon such exercise, and (b) will take all such action as may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and non-assessable shares of Series A Preferred upon exercise of this
Warrant.
14. NOTICES OF RECORD DATE. In case:
14.1. the Company shall take a record of the holders of its Common
Stock (or other stock or securities at the time receivable upon the conversion
of the Series A Preferred), for the purpose of entitling them to receive any
dividend or other distribution, or any right to subscribe for or purchase any
shares of stock of any class or any other securities or to receive any other
right; or
14.2. of any consolidation or merger of the Company with or into
another corporation, any capital reorganization of the Company, any
reclassification of the Capital Stock of the Company, or any conveyance of all
or substantially all of the assets of the Company to another corporation in
which holders of the Company's stock are to receive stock, securities or
property of another corporation; or
14.3. of any voluntary dissolution, liquidation or winding-up of the
Company; or
14.4. of any redemption or conversion of all outstanding Series A
Preferred;
then, and in each such case, the Company will mail or cause to be
mailed to the Holder of this Warrant a notice specifying, as the case
may be, (i) the date on which a record is to be taken for the purpose
of such dividend, distribution or right, or (ii) the date on which such
reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation, winding-up, redemption or conversion is to
take place, and the time, if any is to be fixed, as of which the
holders of record of Common Stock (or such stock or securities as at
the time are receivable upon the conversion of the Series A Preferred),
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shall be entitled to exchange their shares of Common Stock (or such
other stock or securities), for securities or other property
deliverable upon such reorganization, reclassification, consolidation,
merger, conveyance, dissolution, liquidation or winding-up. Such notice
shall be delivered at least thirty (30) days prior to the date therein
specified.
15. SEVERABILITY. If any term, provision, covenant or restriction of
this Warrant is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Warrant shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.
16. COUNTERPARTS. For the convenience of the parties, any number of
counterparts of this Warrant may be executed by the parties hereto and each such
executed counterpart shall be, and shall be deemed to be, an original
instrument.
17. NO INCONSISTENT AGREEMENTS. The Company will not on or after the
date of this Warrant enter into any agreement with respect to its securities
which is inconsistent with the rights granted to the Holders of this Warrant or
otherwise conflicts with the provisions hereof. The rights granted to the
Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to holders of the Company's securities under any other
agreements, except rights that have been waived.
18. SATURDAYS, SUNDAYS AND HOLIDAYS. If the Expiration Date falls on a
Saturday, Sunday or legal holiday, the Expiration Date shall automatically be
extended until 5:00 p.m. the next Business Day.
19. FULL EXERCISE ON OR PRIOR TO JUNE 10, 2002. Notwithstanding any
other provision in this Warrant to the contrary, on or prior to June 10, 2002,
this Warrant may be exercised only in whole, and not in part, in accordance with
and pursuant to the terms of that certain escrow agreement described in Section
2.2 of the Purchase Agreement. In connection with such exercise on or prior to
June 10, 2002, the Holder will direct in the Notice of Exercise that all of the
Exercise Amount must be applied by the Company towards a complete prepayment of
the Brunswick Note, in accordance with the terms of the Brunswick Note. The
Company shall take all reasonable actions to exercise the Company's right to
prepay the Brunswick Note and to effect such prepayment, including, without
limitation, those actions set forth in Section 5.1 of the Purchase Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Warrant as of
the Effective Date.
TMRC, L.L.P. TRAVIS BOATS & MOTORS, INC.
By: Tracker Marine, L.L.C.
By: Three Johns Company, By:
its sole member ------------------------------
Name: Mark T. Walton
Title: President
By
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Name:
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Title:
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EXHIBIT 1
NOTICE OF EXERCISE
(To be executed upon exercise of Warrant)
[COMPANY NAME]
The undersigned hereby irrevocably elects to exercise the right of purchase
represented by the within Warrant Certificate for, and to purchase thereunder,
the securities of Travis Boats & Motors, Inc. (the "Company"), as provided for
therein, and tenders herewith payment of the exercise price in full in the form
of cash or a certified or official bank check in same-day funds in the amount of
$____________ for _________ such securities.
Please issue a certificate or certificates for such securities in the name of,
and pay any cash for any fractional share to (please print name, address and
social security number):
Name:
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Address:
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Signature:
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Note: The above signature should correspond exactly with the name on the first
page of this Warrant Certificate or with the name of the assignee appearing in
the assignment form below.
If said number of shares shall not be all the shares purchasable under the
within Warrant Certificate, a new Warrant Certificate is to be issued in the
name of said undersigned for the balance remaining of the shares purchasable
thereunder rounded up to the next higher whole number of shares.
[If exercise is on or before June 10, 2002, the following language shall also be
included]
The undersigned hereby directs the Company, in accordance with Section 2.1 of
the Warrant Agreement, to apply all of the Exercise Amount set forth above,
towards the prepayment of the Brunswick Note in accordance with the terms of the
Brunswick Note. The Company is directed to immediately take all reasonable
actions to exercise the Company's right to prepay the Brunswick Note and to
effect such prepayment, including, without limitation, those actions set forth
in Section 5.1 of the Purchase Agreement.
EXHIBIT 2
ASSIGNMENT
(To be executed only upon assignment of Warrant Certificate)
For value received, hereby sells, assigns and transfers unto
____________________________ the within Warrant Certificate, together with all
right, title and interest therein, and does hereby irrevocably constitute and
appoint ____________________________ attorney, to transfer said Warrant
Certificate on the books of the within-named Company with respect to the number
of Warrants set forth below, with full power of substitution in the premises:
Name(s) of Assignee(s) Address # of Warrants
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And if said number of Warrants shall not be all the Warrants represented by the
Warrant Certificate, a new Warrant Certificate is to be issued in the name of
said undersigned for the balance remaining of the Warrants registered by said
Warrant Certificate.
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Dated:
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Signature:
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