Exhibit 4.1
TALISMAN ENTERPRISES INC.
WARRANT AGREEMENT
September ___, 1999
CAPITAL WEST SECURITIES, INC.
211 N. Robinson
2nd Floor, One Leadership Square
Oklahoma City, Oklahoma 73102
Ladies and Gentlemen:
Talisman Enterprises Inc., an Ontario, Canada corporation (the "Company"),
agrees to issue and sell to you warrants (the "Warrants") to purchase the number
of shares of common stock, no par value per share, of the Company (the "Common
Stock") set forth herein, subject to the terms and conditions contained herein.
1. ISSUANCE OF WARRANTS; EXERCISE PRICE. The Warrants, which shall be in
the form attached hereto as EXHIBIT "A," shall be issued to you concurrently
with the execution hereof in consideration of the payment by you to the Company
of the sum of $0.001 cash per share of Common Stock subject to the Warrants, the
receipt and sufficiency of which are hereby acknowledged. The Warrant shall
provide that you, or such other holder or holders of the Warrants to whom
transfer is authorized in accordance with the terms of this Agreement, shall
have the right to purchase an aggregate of 100,000 shares of Common Stock for an
exercise price equal to $8.25 per share (the "Exercise Price") or $825,000 in
the aggregate. The number, character and Exercise Price of such shares of Common
Stock are subject to adjustment as hereinafter provided, and the term "Common
Stock" shall mean, unless the context otherwise requires, the stock and other
securities and property receivable upon exercise of the Warrants. The term
"Exercise Price" shall mean, unless the context otherwise requires, the price
per share of the Common Stock purchasable under the Warrants as set forth in
this Section 1, as adjusted from time to time pursuant to Section 6.
2. REPRESENTATIONS AND WARRANTIES. The Company represents and warrants to
you and to each subsequent holder of Warrants and agrees that:
(a) This Agreement has been duly authorized, executed and delivered
by the Company and constitutes the valid and binding obligation of the Company
enforceable in accordance with its terms; and neither the issuance of the
Warrants nor the issuance of the shares of Common Stock issuable upon exercise
of the Warrants will result in a breach or violation of any terms or provisions
of, or constitute a default under, any contract, indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company is a
party or by which the Company is bound, the charter or bylaws of the Company, or
any law, order, rule, regulation or decree of any government, governmental
instrumentality or court, domestic or foreign, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company.
(b) No consent, approval, authorization or order of any court or
governmental agency or body is required for the sale and issuance of the
Warrants or the sale and issuance of the shares of Common Stock issuable upon
exercise of the Warrants, except such as have been obtained or may be
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Warrant Agreement
Page 1
required under the Securities Act of 1933, as amended (the "Act"), and such as
may be required under state securities or blue sky laws in connection with the
issuance of the Warrants and the shares of Common Stock issuable upon exercise
of the Warrants. Upon exercise of the Warrants by the holder thereof, the shares
of Common Stock with respect to which the Warrants are exercised will be validly
issued, fully paid, and nonassessable, and good and marketable title to such
shares of Common Stock shall be delivered to such holder free and clear of all
liens, encumbrances, equities, claims or preemptive or similar rights.
(c) As if the Company were a United States issuer of securities,
during the term of this Agreement, the Company shall make timely filings of all
periodic and other reports and forms and other materials required (but only to
the extent required) to be filed with the Securities and Exchange Commission
(the "Commission") pursuant to the Act or the Securities Exchange Act of 1934,
as amended, and with any national securities exchange or quotation system upon
which any of the securities of the Company may be listed, including by way of
example, but not limited to, Annual Reports on Form 10-K, Quarterly Reports on
Form 10-Q, Current Reports on Form 8-K, Initial Statement of Beneficial
Ownership of Securities on Form 3, and Statement of Changes of Beneficial
Ownership of Securities on Form 4.
3. NOTICES OF RECORD DATE; ETC. In the event of (a) any taking by the
Company of a record date with respect to the holders of any class of securities
of the Company for purposes of determining which of such holders are entitled to
dividends or other distributions (other than regular quarterly dividends), or
any right to subscribe for, purchase or otherwise acquire shares of stock of any
class or any other securities or property, or to receive any other right, (b)
any capital reorganization of the Company, or reclassification or
recapitalization of capital stock of the Company or any transfer in one or more
related transactions of all or a majority of the assets or revenue or income
generating capacity of the Company to, or consolidation or merger of the Company
with or into, any other entity or person, or (c) any voluntary or involuntary
dissolution or winding up of the Company, then and in each such event the
Company will mail or cause to be mailed to each holder of a Warrant at the time
outstanding a notice specifying, as the case may be, (i) the date on which any
such record is to be taken for the purpose of such dividend, distribution or
right, and stating the amount and character of such dividend, distribution or
right; or (ii) the date on which any such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, conveyance, dissolution,
liquidation or winding-up is to take place and the time, if any is to be fixed,
as of which the holders of record of Common Stock (or any other class of stock
or securities of the Company, or another issuer pursuant to Section 6,
receivable upon the exercise of the Warrants) shall be entitled to exchange
their shares of Common Stock (or such other stock or securities) for securities
or other property deliverable upon such event. Any such notice shall be
deposited in the United States mail, postage prepaid, at least ten (10) days
prior to the date therein specified, and the holders(s) of the Warrant(s) may
exercise the Warrant(s) and participate in such event as a registered holder of
Common Stock, upon exercise of the Warrant(s) so held, within the ten (10) day
period from the date of mailing of such notice.
4. NO IMPAIRMENT. The Company shall not, by amendment of its
organizational documents or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities, or any other
action, avoid or seek to avoid the observance or performance of any of the terms
of this Agreement or of the Warrants, but will at all times in good faith take
any and all action as may be necessary in order to protect the rights of the
holders of the Warrants against impairment. Without limiting the generality of
the foregoing, the Company (a) will at all times reserve and keep available,
solely for issuance and delivery upon exercise of the Warrants, shares of Common
Stock issuable from time to time upon exercise of the Warrants, (b) will not
increase the par value of any shares of stock receivable upon exercise of the
Warrants above the amount payable in respect thereof upon such exercise, and (c)
will take
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Warrant Agreement
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all such action as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and non-assessable stock upon
the exercise of the Warrants, or any of them.
5. EXERCISE OF WARRANTS. At any time and from time to time on and after
the first anniversary of the date hereof and expiring on the fifth anniversary
of the effective date of the registration statement filed by the Company with
the Securities and Exchange Commission on Form SB-2 (File No. 333-83123),
September __, 1999, at 5:00 p.m., Oklahoma City, Oklahoma time, Warrants may be
exercised as to all or any portion of the whole number of shares of Common Stock
covered by the Warrants by the holder thereof by surrender of the Warrants,
accompanied by a subscription for shares to be purchased as marked on the form
attached hereto as EXHIBIT "B" and by a check payable to the order of the
Company in the amount required for purchase of the shares as to which the
Warrant is being exercised, delivered to the Company at its principal office at
2330 Southfield Road, Mississauga, Ontario, Canada, L5N2W8, Attention:
President. Warrants may also be exercised from time to time, without any payment
required for the purchase of the shares as to which the Warrant is being
exercised, as to all or any portion of the number of shares of Common Stock
covered by the Warrant(s) by the holder thereof by surrender of the Warrants,
accompanied by a subscription for shares as marked on the form attached as
EXHIBIT "B," pursuant to which the holder thereof will be entitled to receive
upon such surrender of the Warrant(s) (and without any further payment) that
number of shares of Common Stock equal to the product of the number of shares of
Common Stock obtainable upon exercise of the Warrant(s) (or the portion thereof
as to which the exercise relates) multiplied by a fraction: (i) the numerator of
which shall be the difference between the then Current Value (as defined in this
Section 5 and Section 7(d)) of one full share of Common Stock on the date of
exercise and the Exercise Price, and (ii) the denominator of which shall be the
Current Value of one full share of Common Stock on the date of exercise. Upon
the exercise of a Warrant in whole or in part, the Company will within five (5)
days thereafter, at its expense (including the payment by the Company of any
applicable issue or transfer taxes), cause to be issued in the name of and
delivered to the Warrant holder a certificate or certificates for the number of
fully paid and non-assessable shares of Common Stock to which such holder is
entitled upon exercise of the Warrant. In the event such holder is entitled to a
fractional share, in lieu thereof such holder shall be paid a cash amount equal
to such fraction, multiplied by the Current Value of one full share of Common
Stock on the date of exercise. Certificates for shares of Common Stock issuable
by reason of the exercise of the Warrant or Warrants shall be dated and shall be
effective as of the date of the surrendering of the Warrant for exercise,
notwithstanding any delays in the actual execution, issuance or delivery of the
certificates for the shares so purchased. In the event a Warrant (or Warrants)
is exercised as to less than the aggregate amount of all shares of Common Stock
issuable upon exercise of all Warrants held by such person, the Company shall
issue a new Warrant to the holder of the Warrant so exercised covering the
aggregate number of shares of Common Stock as to which Warrants remain
unexercised.
For purposes of this section, Current Value is defined (i) in the case for
which a public market exists for the Common Stock at the time of such exercise,
according to Section 7(d), and (ii) in the case no public market exists at the
time of such exercise, at the Appraised Value. For the purposes of this
Agreement, "Appraised Value" is the value determined in accordance with the
following procedures. For a period of five (5) days after the date of an event
(a "Valuation Event") requiring determination of Current Value at a time when no
public market exists for the Common Stock (the "Negotiation Period"), each party
to this Agreement agrees to negotiate in good faith to reach agreement upon the
Appraised Value of the securities or property at issue, as of the date of the
Valuation Event, which will be the fair market value of such securities or
property, without premium for control or discount for minority interests,
illiquidity or restrictions on transfer. In the event that the parties are
unable to agree upon the Appraised Value of such securities or other property by
the end of the Negotiation Period, then the Appraised Value of such securities
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or property will be determined for purposes of this Agreement by a recognized
appraisal or investment banking firm mutually agreeable to the holders of the
Warrants and the Company (the "Appraiser"). If the holders of the Warrants and
the Company cannot agree on an Appraiser within two (2) business days after the
end of the Negotiation Period, the Company, on the one hand, and the holders of
the Warrants, on the other hand, will each select an Appraiser within ten (10)
business days after the end of the Negotiation Period and those two Appraisers
will select, ten (10) days after the end of the Negotiation Period, an
independent Appraiser to determine the fair market value of such securities or
property, without premium for control or discount for minority interests. Such
independent Appraiser will be directed to determine fair market value of such
securities or property as soon as practicable, but in no event later than thirty
(30) days from the date of its selection. The determination by an Appraiser of
the fair market value will be conclusive and binding on all parties to this
Agreement. Appraised Value of each share of Common Stock at a time when (i) the
Company is not a reporting company under the Exchange Act and (ii) the Common
Stock is not traded in the organized securities markets, will, in all cases, be
calculated by determining the Appraised Value of the entire Company taken as a
whole and dividing that value by the number of shares of Common Stock then
outstanding, without premium for control or discount for minority interests,
illiquidity or restrictions on transfer. The costs of the Appraiser will be
borne by the Company. In no event will the Appraised Value of the Common Stock
be less than the per share consideration received or receivable with respect to
the Common Stock or securities or property of the same class in connection with
a pending transaction involving a sale, merger, recapitalization,
reorganization, consolidation, or share exchange, dissolution of the Company,
sale or transfer of all or a majority of its assets or revenue or income
generating capacity, or similar transaction.
6. PROTECTION AGAINST DILUTION. The Exercise Price for the shares of
Common Stock and number of shares of Common Stock issuable upon exercise of the
Warrants is subject to adjustment from time to time as follows:
(a) STOCK DIVIDENDS, SUBDIVISIONS, RECLASSIFICATIONS, ETC.. In case
at any time or from time to time after the date of execution of this Agreement,
the Company shall (i) take a record of the holders of Common Stock for the
purpose of entitling them to receive a dividend or a distribution on shares of
Common Stock payable in shares of Common Stock or other class of securities,
(ii) subdivide or reclassify its outstanding shares of Common Stock into a
greater number of shares, or (iii) combine or reclassify its outstanding Common
Stock into a smaller number of shares, then, and in each such case, the Exercise
Price in effect at the time of the record date for such dividend or distribution
or the effective date of such subdivision, combination or reclassification shall
be adjusted in such a manner that the Exercise Price for the shares issuable
upon exercise of the Warrants immediately after such event shall bear the same
ratio to the Exercise Price in effect immediately prior to any such event as the
total number of shares of Common Stock outstanding immediately prior to such
event shall bear to the total number of shares of Common Stock outstanding
immediately after such event.
(b) ADJUSTMENT OF NUMBER OF SHARES PURCHASABLE. When any adjustment
is required to be made in the Exercise Price under this Section 6, (i) the
number of shares of Common Stock issuable upon exercise of the Warrants shall be
changed (upward to the nearest full share) to the number of shares determined by
dividing (x) an amount equal to the number of shares issuable pursuant to the
exercise of the Warrants immediately prior to the adjustment, multiplied by the
Exercise Price in effect immediately prior to the adjustment, by (y) the
Exercise Price in effect immediately after such adjustment, and (ii) upon
exercise of the Warrant, the holder will be entitled to receive the number of
shares of other securities referred
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to in Section 6(a) that such holder would have received had the Warrant been
exercised prior to the events referred to in Section 6(a).
(c) ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER, ETC.. In
case of any reorganization or consolidation of the Company with, or any merger
of the Company with or into, another entity (other than a consolidation or
merger in which the Company is the surviving corporation) or in case of any sale
or transfer to another entity of the majority of assets of the Company, the
entity resulting from such reorganization or consolidation or surviving such
merger or to which such sale or transfer shall be made, as the case may be,
shall make suitable provision (which shall be fair and equitable to the holders
of Warrants) and shall assume the obligations of the Company hereunder (by
written instrument executed and mailed to each holder of the Warrants then
outstanding) pursuant to which, upon exercise of the Warrants, at any time after
the consummation of such reorganization, consolidation, merger or conveyance,
the holder shall be entitled to receive the stock or other securities or
property that such holder would have been entitled to upon consummation if such
holder had exercised the Warrants immediately prior thereto, all subject to
further adjustment as provided in this Section 6.
(d) CERTIFICATE AS TO ADJUSTMENTS. In the event of adjustment as
herein provided in the subparagraphs of this Section 6, the Company shall
promptly mail to each Warrant holder a certificate setting forth the Exercise
Price and number of shares of Common Stock issuable upon exercise after such
adjustment and setting forth a brief statement of facts requiring such
adjustment. Such certificate shall also set forth a brief statement of facts
requiring such adjustment. Such certificate shall also set forth the kind and
amount of stock or other securities or property into which the Warrants shall be
exercisable after any adjustment of the Exercise Price as provided in this
Agreement.
(e) MINIMUM ADJUSTMENT. Notwithstanding the foregoing, no certificate
as to adjustment of the Exercise Price hereunder shall be made if such
adjustment results in a change in the Exercise Price then in effect of less than
five cents ($0.05) and any adjustment of less than five cents ($0.05) of any
Exercise Price shall be carried forward and shall be made at the time of and
together with any subsequent adjustment that, together with the adjustment or
adjustments so carried forward, amounts to five cents ($0.05) or more; provided
however, that upon the exercise of a Warrant, the Company shall have made all
necessary adjustments (to the nearest cent) not theretofore made to the Exercise
Price up to and including the date upon which such Warrant is exercised.
7. INDEMNIFICATION; CONTRIBUTION.
(a) The Company will indemnify and hold harmless each holder and each
affiliate thereof of Common Stock registered pursuant to this Agreement with the
Commission, or under any Blue Sky Law or regulation against any losses, claims,
damages, or liabilities, joint or several, to which such holder may become
subject under the Act or otherwise, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
preliminary prospectus, registration statement, prospectus, or any amendment or
supplement thereto, or arise out of or are based upon 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, and will reimburse each
such holder and affiliate for any legal or other expenses reasonably incurred by
such holder in connection with investigating or defending any such action or
claim regardless of the negligence of any such holder or affiliate; provided,
however, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage, or liability arises out of or is based upon
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an untrue statement or alleged untrue statement or omission or alleged omission
made in any preliminary prospectus, registration statement or prospectus, or any
such amendment or supplement thereto, in reliance upon and in conformity with
written information furnished to the Company by any such holder expressly for
use therein.
(b) Each holder of Common Stock registered pursuant to this Agreement
will indemnify and hold harmless the Company against any losses, claims,
damages, or liabilities to which the Company may become subject, under the Act
or otherwise, insofar as such losses, claims, damages, or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in any preliminary
prospectus, registration statement or prospectus, or any amendment or supplement
thereto, or arise out of or are based upon 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, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any preliminary prospectus, registration
statement or prospectus, or any amendment or supplement thereto, in reliance
upon and in conformity with written information furnished to the Company by such
holder expressly for use therein.
(c) Promptly after receipt by an indemnified party under Sections
7(a) or (b) above of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under either such subsection, notify the indemnifying party in writing of
the commencement thereof; but the omission so to notify the indemnifying party
shall not relieve it from any liability that it may otherwise have to any
indemnified party. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the commencement
thereof the indemnifying party shall be entitled to assume the defense thereof
by notice in writing to the indemnified party. After notice from the
indemnifying party to such indemnified party of its election to assume the
defense thereof, the indemnifying party shall not be liable to such indemnified
party under either of such subsections for any legal expenses of other counsel
or any other expense, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation incurred prior to the assumption by the indemnifying party, unless
such expenses have been specifically authorized in writing by the indemnifying
party, the indemnifying party has failed to assume the defense and employ
counsel, or the named parties to any such action include both the indemnified
party and the indemnifying party, as appropriate, and such indemnified party has
been advised by counsel that the representation of such indemnified party and
the indemnifying party by the same counsel would be inappropriate due to actual
or potential differing interests between them, in each of which cases the fees
of counsel for the indemnified party will be paid by the indemnifying party.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under Section
7(a) or 7(b) in respect of any losses, claims, damages, or liabilities (or
action in respect thereof) referred to therein, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the holder or holders from this Agreement and from
the offering of the shares of Common Stock. If, however, the allocation provided
by the immediately preceding sentence is not permitted by applicable law, then
each indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company and the holders in
connection with the statement or omissions that resulted in such losses, claims,
damages, or liabilities (or actions in respect thereof), as well as any other
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relevant equitable considerations. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the holder and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the holders agree that it
would not be just and equitable if contribution pursuant to this Section 7(d)
were determined by pro rata allocation (even if the holders were treated as one
entity for such purpose) or by any other method of allocation that does not take
into account the equitable considerations referred to above in this subsection
(d). Except as provided in Section 7(c), the amount paid or payable by an
indemnified party as a result of the losses, claims, damages, or liabilities (or
actions in respect thereof) referred to above in this Section 7(d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigation or defending any such action
or claim. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. Notwithstanding any
provision in this Section 7(d) to the contrary, no holder shall be liable for
any amount, in the aggregate, in excess of the net proceeds to such holder from
the sale of such holder's shares (obtained upon exercise of Warrants) giving
rise to such losses, claims, damages, or liabilities.
(e) The obligations of the Company under this Section 7 shall be in
addition to any liability that the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
holder of Warrants within the meaning of the Act. The obligations of the holders
of Common Stock under this Section 7 shall be in addition to any liability that
such holders may otherwise have and shall extend, upon the same terms and
conditions to each person, if any, who controls the Company within the meaning
of the Act.
8. STOCK EXCHANGE LISTING. In the event the Company lists its Common
Stock on any national securities exchange, the Company will, at its expense,
also list on such exchange, upon exercise of a Warrant, all shares of Common
Stock issuable pursuant to such Warrant.
9. SPECIFIC PERFORMANCE. The Company stipulates that remedies at law, in
money damages, available to the holder of a Warrant, or of a holder of Common
Stock issued pursuant to exercise of a Warrant, in the event of any default or
threatened default by the Company in the performance of or compliance with any
of the terms of this Agreement are not and will not be adequate. Therefore, the
Company agrees that the terms of this Agreement may be specifically enforced by
a decree for the specific performance of any agreement contained herein or by an
injunction against a violation of any of the terms hereof or otherwise.
10. SUCCESSORS AND ASSIGNS; BINDING EFFECT. This Agreement shall be
binding upon and inure to the benefit of you and the Company and their
respective successors and permitted assigns.
11. NOTICES. Any notice hereunder shall be given by registered or
certified mail, if to the Company, at its principal office referred to in
Section 5 and, if to the holders, to their respective addresses shown in the
Warrant ledger of the Company, provided that any holder may at any time on three
(3) days' written notice to the Company designate or substitute another address
where notice is to be given. Notice shall be deemed given and received after a
certified or registered letter, properly addressed with postage prepaid, is
deposited in the U.S. mail.
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12. SEVERABILITY. Every provision of this Agreement is intended to be
severable. If any term or provision hereof is illegal or invalid for any reason
whatsoever, such illegality or invalidity shall not affect the remainder of this
Agreement.
13. ASSIGNMENT; REPLACEMENT OF WARRANTS. If the Warrant or Warrants are
assigned, in whole or in part, the Warrants shall be surrendered at the
principal office of the Company, and thereupon, in the case of a partial
assignment, a new Warrant shall be issued to the holder thereof covering the
number of shares not assigned, and the assignee shall be entitled to receive a
new Warrant covering the number of shares so assigned. Upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction, or
mutilation of any Warrant and appropriate bond or indemnification protection,
the Company shall issue a new Warrant of like tenor. Except as contemplated by
Section 7 of this Agreement, the Warrants will not be transferred, sold, or
otherwise hypothecated by you or any other person and the Warrants will be
nontransferable, except to (i) one or more persons, each of which on the date of
transfer is an officer, shareholder, or employee of you; (ii) a partnership or
partnerships, the partners of which are you and one or more persons, each of
whom on the date of transfer is an officer of you; (iii) a successor to you in
merger or consolidation; (iv) a purchaser of all or substantially all of your
assets; or (v) a person that receives a Warrant upon death of a Holder pursuant
to will, trust, or the laws of intestate succession.
14. GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of Oklahoma without giving effect to the
principles of choice of laws thereof.
15. DEFINITION. All references to the word "you," and to "Capital West
Securities, Inc." in this Agreement shall be deemed to apply with equal effect
to any persons or entities to whom Warrants have been transferred in accordance
with the terms hereof, and, where appropriate, to any persons or entities
holding shares of Common Stock issuable upon exercise of Warrants.
16. HEADINGS. The headings herein are for purposes of reference only and
shall not limit or otherwise affect the meaning of any of the provisions hereof.
17. BINDING ARBITRATION. Each party to this Agreement agrees that any
dispute or controversy arising between any of the parties to this agreement, or
any person or entity in privity therewith, out of the transactions effected and
relationships created pursuant to this Agreement and each other agreement
created in connection herewith, including any dispute or controversy regarding
the formation, terms, or construction of this Agreement, regardless of kind or
character, must be resolved through binding arbitration. Each party to this
Agreement agrees to submit such dispute or controversy to arbitration before the
American Arbitration Association (the "Association") in Oklahoma City, Oklahoma,
and further agrees to be bound by the determination of an arbitration panel
consisting of three (3) persons. If demand for arbitration is made, each party
will have the right to select one independent arbitrator. If the party upon whom
the demand for arbitration is served fails to select an arbitrator within twenty
days, then the Association may select a second arbitrator upon application by
either party. The two arbitrators shall select a third arbitrator. If the two
arbitrators fail to select a third arbitrator within twenty days, the third
arbitrator may be selected and appointed by the Association upon application by
either party. The arbitrators' decision concerning the claim, controversy or
dispute, including allocation among the parties of costs and expenses associated
with the arbitration, shall be final and binding on the parties and judgment on
the award may be entered in any court of competent jurisdiction. Any party to
this Agreement may bring an action, including a summary or expedited proceeding,
to compel arbitration of any such dispute or controversy in a court of competent
jurisdiction and, further, may seek provisional or ancillary remedies including
temporary or injunctive relief
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in connection with such dispute or controversy in a court of competent
jurisdiction, provided that the dispute or controversy is ultimately resolved
through binding arbitration conducted in accordance with the terms and
conditions of this section.
Very truly yours,
TALISMAN ENTERPRISES INC.
By:____________________________________
Norman R. Proulx, Chairman
CONFIRMED AND ACCEPTED, as of the date first above written:
CAPITAL WEST SECURITIES, INC.
By:___________________________________
Robert O. McDonald, Chairman
Talisman Enterprises Inc.
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EXHIBIT A
WARRANT
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF ARE SUBJECT TO THE
TERMS AND PROVISIONS OF A WARRANT AGREEMENT DATED AS OF SEPTEMBER __, 1999 (THE
"AGREEMENT"), AS SUCH AGREEMENT MAY BE SUPPLEMENTED, MODIFIED, AMENDED OR
RESTATED FROM TIME TO TIME. COPIES OF THE AGREEMENT ARE AVAILABLE AT THE
EXECUTIVE OFFICES OF THE COMPANY. TRANSFER OF THIS WARRANT IS RESTRICTED AS
PROVIDED IN SECTION 14 OF THE AGREEMENT.
60,000 SHARES WARRANT NO. 99-001
WARRANT TO PURCHASE
SHARES OF COMMON STOCK
TALISMAN ENTERPRISES INC.
THIS IS TO CERTIFY that _________________________________ or its assigns as
permitted in that certain Warrant Agreement dated September __, 1999, between
the Company (as hereinafter defined) and Capital West Securities, Inc., [ ] and
[ ] is entitled to purchase at any time or from time to time on or after
September __, 2000 until 5:00 p.m., Oklahoma City, Oklahoma time on September
__, 2004, an aggregate of 100,000 shares of Common Stock, no par value per
share, of Talisman Enterprises Inc., an Ontario, Canada corporation (the
"Company"), for an exercise price per share as set forth in the Warrant
Agreement referred to herein. This Warrant is issued pursuant to the Warrant
Agreement, and all rights of the holder of this Warrant are further governed by,
and subject to the terms and provisions of such Warrant Agreement, copies of
which are available upon request to the Company. The holder of this Warrant and
the shares issuable upon the exercise hereof shall be entitled to the benefits,
rights and privileges and subject to the obligations, duties and liabilities
provided in the Warrant Agreement.
Subject to the provisions of the Act, of the Warrant Agreement and of this
Warrant, this Warrant and all rights hereunder are transferable, in whole or in
part, only to the extent expressly permitted in such documents and then only at
the office of the Company at 2330 Southfield Road, Mississauga, Ontario, Canada
L5N2W8, by the holder hereof or by a duly authorized attorney-in-fact, upon
surrender of this Warrant duly endorsed, together with the Assignment hereof
duly endorsed. Until transfer hereof on the books of the Company, the Company
may treat the registered holder hereof as the owner hereof for all purposes.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed and
its corporate seal to be hereunto affixed by its proper corporate officers
thereunto duly authorized.
TALISMAN ENTERPRISES INC.
By:_________________________________
Norman Proulx, Chairman
(SEAL)
Attest:
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Name:
Title: Secretary
EXHIBIT B
SUBSCRIPTION
TO BE SIGNED ONLY UPON EXERCISE (IN WHOLE OR IN PART) OF THE WARRANTS
TO: TALISMAN ENTERPRISES INC.
2330 Southfield Road
Mississauga, Ontario
Canada L5N2W8
1. The undersigned, _______________________________, pursuant to the
provisions of that certain Warrant Agreement dated September __, 1999 (the
"Warrant Agreement"), and the attached Warrant Certificate, hereby agrees
to subscribe for the purchase of ___________ shares of common stock of
TALISMAN ENTERPRISES INC., no par value per share (the "Common Stock"),
covered by the attached Warrant Certificate, and makes payment therefor in
full at the price per share provided by the Warrant Agreement.
2. The undersigned Holder (check one):
___ a. elects to pay the aggregate purchase price for such shares
of Common Stock (i) by lawful money of the United States or
the enclosed certified or official bank check payable in
United States dollars to the order of the Company in the
amount of $______________, or (ii) by wire transfer of
United States funds to the account of the Company in the
amount of $___________, which transfer has been made before
or simultaneously with the delivery of this Subscription
pursuant to the instructions of the Company; or
___ b. elects to pay the aggregate purchase price by implementing
the cashless exercise procedure pursuant to Section 5 of the
Warrant Agreement.
3. Please issue a stock certificate or certificates representing the
appropriate number of shares of Common Stock in the name of the undersigned
or in such other name(s) as is specified below:
Name:
Address:
Certificates shall be issued in such name and delivered to such address
unless otherwise specified by written instructions, signed by the
undersigned and accompanying this subscription.
If exercised in part, the balance of the shares of Common Stock subject to
the Warrant, as constituted at the date of the Warrant, shall be covered by
a new Warrant Certificate, which shall be issued in the name of the Holder
and delivered to the address for the Holder on the books of the Company.
Dated: ___________________________ Signature: ___________________________
Name: ___________________________ Address: _____________________________
Soc. Sec. # or Fed. ID #: ____________________________________________