Stock Purchase Warrant - BUCA Inc. and Piper Jaffray Inc.
STOCK PURCHASE WARRANT
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As of October 23, 1996, BUCA, Inc. issued the attached Stock Purchase
Warrant to Piper Jaffray Inc. The following Schedule sets forth the material
details in which another substantially identical Stock Purchase Warrant, issued
to the Purchaser named in the following Schedule, differs from the attached
copy.
SCHEDULE OF DIFFERENCES BETWEEN ATTACHED COPY AND A SUBSTANTIALLY IDENTICAL COPY
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DESCRIPTION DETAILS OF ATTACHED DETAILS OF
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---- IDENTICAL COPY
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NAME OF PURCHASER: Piper Jaffray Inc. Michael Bochert
NUMBER OF SHARES: one hundred twelve thousand Forty Four Thousand Eight
(112,000) Hundred (44,800)
DATED AS OF: October 23, 1996 October 24, 1996
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STOCK PURCHASE WARRANT
TO SUBSCRIBE FOR AND PURCHASE
SERIES A CONVERTIBLE PREFERRED STOCK OF
BUCA, INC.
THIS CERTIFIES THAT, for value received, Piper Jaffray Inc. (herein
called "Purchaser"), or registered assigns, is entitled to subscribe for and
purchase from BUCA, Inc. (herein called the "Company"), a corporation organized
and existing under the laws of the State of Minnesota, at the price specified
below (subject to adjustment as noted below) at any time after the date hereof
to and including October 23, 2003 (the "Expiration Date") one hundred twelve
thousand (112,000) fully paid and nonassessable shares of Series A Convertible
Preferred Stock (herein the "Preferred Stock") (subject to adjustment as noted
below).
The warrant purchase price (subject to adjustment as noted below)
shall be $3.75 per share.
This Warrant is subject to the following provisions, terms and
conditions:
1. The rights represented by this Warrant may be exercised by the
holder hereof, in whole or in part, by written notice of exercise delivered to
the Company 20 days prior to the intended date of exercise and by the surrender
of this Warrant (properly endorsed if required) at the principal office of the
Company and upon payment to it by check of the purchase price for such shares.
The Company agrees that the shares so purchased shall be and are deemed to be
issued to the holder hereof 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. Subject to the provisions of the next
succeeding paragraph, certificates for the shares of stock so purchased shall be
delivered to the holder hereof within a reasonable time, not exceeding 10 days,
after the rights represented by this Warrant shall have been so exercised, and,
unless this Warrant has expired, a new Warrant representing the number of
shares, if any, with respect to which this Warrant shall not then have been
exercised shall also be delivered to the holder hereof within such time.
2. Notwithstanding the foregoing, however, the Company shall not be
required to deliver any certificate for shares of stock upon exercise of this
Warrant except in accordance with the provisions, and subject to the
limitations, of paragraph 7 hereof.
3. The Company represents and warrants that: (a) the Company has all
requisite power and authority to execute, issue and perform this Warrant and to
issue the Preferred Stock and the shares of Common Stock of the Company (the
"Common Stock") issuable upon conversion of the Preferred Stock (the "Warrant
Conversion Stock"); (b) this
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Warrant has been duly authorized by all necessary corporate action, has been
duly executed and delivered and is a legal and binding obligation of the
Company; (c) that all shares which may be issued upon the exercise of the rights
represented by this Warrant according to the terms hereof or represented by the
Preferred Stock will, upon issuance, be duly authorized and issued, fully paid
and nonassessable; (d) during the period within which the rights represented by
this Warrant may be exercised or the Preferred Stock may be converted into
Common Stock, the Company will at all times have authorized, and reserved for
the purpose of issue or transfer upon exercise of the subscription rights
evidenced by this Warrant or conversion of the Preferred Stock, a sufficient
number of shares of its Preferred Stock or Common Stock to provide for the
exercise of the rights represented by this Warrant or the Preferred Stock; (e)
the execution, issuance and performance of this Warrant by the Company and the
issuance of the Preferred Stock and Warrant Conversion Stock will not violate
any provision of the articles of incorporation or bylaws of the Company or any
agreement or other instrument to which the Company is a party or by which it is
bound, or any statute, rule or regulation; and (f) any necessary approvals,
government and private, to the execution, issuance and performance of this
Warrant by the Company and the issuance of the Preferred Stock and Warrant
Conversion Stock have been obtained by the Company.
4. The above provisions are, however, subject to the following:
(a) The warrant purchase price shall, from and after the date of
issuance of this Warrant, be subject to adjustment from time to time as
hereinafter provided. Upon each adjustment of the warrant purchase price, the
holder of this Warrant shall thereafter be entitled to purchase, at the warrant
purchase price resulting from such adjustment, the number of shares obtained by
multiplying the warrant purchase price in effect immediately prior to such
adjustment by the number of shares purchasable pursuant hereto immediately prior
to such adjustment and dividing the product thereof by the warrant purchase
price resulting from such adjustment.
(b) In case the Company shall (i) declare a dividend upon the
Preferred Stock payable in Preferred Stock (other than a dividend declared to
effect a subdivision of the outstanding shares of Preferred Stock, as described
in subparagraph (b) below) or any obligations or any shares of stock of the
Company which are convertible into or exchangeable for Preferred Stock (such
obligations or shares of stock being hereinafter referred to as "Convertible
Securities"), or in any rights or options to purchase any Preferred Stock or
Convertible Securities, or (ii) declare any other dividend or make any other
distribution upon the Preferred Stock payable otherwise than out of earnings or
earned surplus, then thereafter the holder of this Warrant upon the exercise
hereof will be entitled to receive the number of shares of Preferred Stock to
which such holder shall be entitled upon such exercise, and, in addition and
without further payment therefor, such number of shares of Preferred Stock, such
that upon exercise hereof, such holder would receive such number of shares of
Preferred Stock as a result
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of each dividend described in clause (i) above and each dividend or distribution
described in clause (ii) above which such holder would have received by way of
any such dividend or distribution if continuously since the record date for any
such dividend or distribution such holder (i) had been the record holder of the
number of shares of Preferred Stock then received, and (ii) had retained all
dividends or distributions in stock or securities (including Preferred Stock or
Convertible Securities, or in any rights or options to purchase any Preferred
Stock or Convertible Securities) payable in respect of such Preferred Stock or
in respect of any stock or securities paid as dividends or distributions and
originating directly or indirectly from such Preferred Stock. For the purposes
of the foregoing, a dividend or distribution other than in cash shall be
considered payable out of earnings or surplus only to the extent that such
earnings or surplus are charged an amount equal to the fair value of such
dividend as determined by the Board of Directors of the Company.
(c) In case the Company shall at any time subdivide its outstanding
shares of Preferred Stock into a greater number of shares, the warrant purchase
price in effect immediately prior to such subdivision shall be proportionately
reduced, and conversely, in case the outstanding shares of Preferred Stock of
the Company shall be combined into a smaller number of shares, the warrant
purchase price in effect immediately prior to such combination shall be
proportionately increased.
(d) If any capital reorganization or reclassification of the capital
stock of the Company, or consolidation or merger of the Company with another
corporation, or the sale of all or substantially all of its assets to another
corporation shall be effected in such a way that holders of Preferred Stock
shall be entitled to receive stock, securities or assets with respect to or in
exchange for Preferred Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provision
shall be made whereby the holder hereof shall thereafter have the right to
purchase and receive, upon the basis and upon the terms and conditions specified
in this Warrant and in lieu of the shares of the Preferred Stock of the Company
immediately theretofore purchasable and receivable upon the exercise of the
rights represented hereby, such shares of stock, securities or assets as may be
issued or payable with respect to or in exchange for a number of outstanding
shares of such Preferred Stock equal to the number of shares of such stock
immediately theretofore purchasable and receivable upon the exercise of the
rights represented hereby had such reorganization, reclassification,
consolidation, merger or sale not taken place, and in any such case appropriate
provision shall be made with respect to the rights and interests of the holder
of this Warrant to the end that the provisions hereof (including without
limitation provisions for adjustments of the warrant purchase price and of the
number of shares purchasable upon the exercise of this Warrant) shall thereafter
be applicable, as nearly as may be, in relation to any shares of stock,
securities or assets thereafter deliverable upon the exercise hereof. The
Company shall not effect any such consolidation, merger or sale, unless prior to
the consummation thereof the successor corporation (if other than the Company)
resulting from such consolidation or merger or the
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corporation purchasing such assets shall assume, by written instrument executed
and mailed to the registered holder hereof at the last address of such holder
appearing on the books of the Company, the obligation to deliver to such holder
such shares of stock, securities or assets as, in accordance with the foregoing
provisions, such holder may be entitled to purchase.
(e) If by reason of the terms of the Company's Articles of
Incorporation, all of the Company's outstanding Preferred Stock shall have been
mandatorily redeemed for cash or mandatorily converted into shares of Common
Stock (either such event being herein referred to as an "Event"), then from and
after such Event, the holder of this Warrant shall have the right to purchase
and receive in lieu of the shares of Preferred Stock immediately theretofore
purchasable and receivable hereunder that number of shares of Common Stock equal
to the number of shares of Common Stock, subject to adjustment as herein
provided, that would have been received if this Warrant had been exercised in
full and the Preferred Stock received thereupon had been simultaneously
converted into shares of Common Stock immediately prior to such Event. The
warrant purchase price shall be immediately adjusted to equal (subject to
further adjustment as herein provided) the quotient obtained by dividing (x) the
aggregate warrant purchase price of the maximum number of shares of Preferred
Stock for which this Warrant was exercisable immediately prior to such Event, by
(y) the number of shares of Common Stock for which this Warrant is exercisable
immediately after such Event. From and after such Event, references in this
Warrant to Preferred Stock shall be deemed amended to be references to Common
Stock, and any other appropriate provision shall be made, to the extent
necessary or appropriate to accord the holder of this Warrant the same rights
and privileges relative to the purchase of Common Stock as this Warrant accorded
the holder relative to the purchase of Preferred Stock prior to the Event
(including without limitation the provisions for adjustments of the warrant
purchase price and of the number of shares purchasable upon exercise of this
Warrant).
(f) Upon any adjustment of the warrant purchase price, then and in
each such case the Company shall give written notice thereof, by first-class
mail, postage prepaid, addressed to the registered holder of this Warrant at the
address of such holder as shown on the books of the Company, which notice shall
state the warrant purchase price resulting from such adjustment and the increase
or decrease, if any, in the number of shares purchasable at such price upon the
exercise of this Warrant, setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based.
(g) In case any time:
(1) the Company shall declare any cash dividend on its capital
stock at a rate in excess of the rate of the last cash dividend theretofore
paid;
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(2) the Company shall pay any dividend payable in stock upon its
capital stock or make any distribution (other than regular cash dividends)
to the holders of its capital stock;
(3) the Company shall offer for subscription pro rata to the
holders of its capital stock any additional shares of stock of any class or
other rights;
(4) there shall be any capital reorganization, or reclassification
of the capital stock of the Company, or consolidation or merger of the
Company with, or sale of all or substantially all of its assets to, another
corporation;
(5) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company; or
(6) there shall be any redemption or mandatory conversion of
Preferred Stock;
then, in any one or more of said cases, the Company shall give written notice,
by first-class mail, postage prepaid, addressed to the registered holder of this
Warrant at the address of such holder as shown on the books of the Company, of
the date on which (aa) the books of the Company shall close or a record shall be
taken for such dividend, distribution or subscription rights, or (bb) such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding up, or conversion or redemption shall take place, as the
case may be. Such notice shall also specify the date as of which the holders of
capital stock of record shall participate in such dividend, distribution or
subscription rights, or shall be entitled to exchange their capital stock for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding up, or conversion or redemption, as the case may be. Such written
notice shall be given at least 20 days prior to the action in question and not
less than 20 days prior to the record date or the date on which the Company's
transfer books are closed in respect thereto.
(h) No fractional shares of Preferred Stock shall be issued upon the
exercise of this Warrant, but, instead of any fraction of a share which would
otherwise be issuable, the Company shall pay a cash adjustment (which may be
effected as a reduction of the amount to be paid by the holder hereof upon such
exercise) in respect of such fraction in an amount equal to the same fraction of
the Market Price per share of Preferred Stock as of the close of business on the
date of the notice required by paragraph 1 above. "Market Price" shall mean, if
the Preferred Stock is traded on a securities exchange or on the NASDAQ National
Market System, the average of the closing prices of the Preferred Stock on such
exchange or the NASDAQ National Market System on the 20 trading days ending on
the trading day prior to
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the date of determination, or, if the Preferred Stock is otherwise traded in the
over-the-counter market, the average of the closing bid prices on the 20 trading
days ending on the trading day prior to the date of determination. If at any
time the Preferred Stock is not traded on an exchange or the NASDAQ National
Market System, or otherwise traded in the over-the-counter market, but the
Common Stock of the Company is, then the Market Price shall be deemed to be the
average closing prices or average closing bid prices of the Common Stock, as the
case may be, or, if such exercise occurs in connection with a public offering of
the Common Stock, the public offering price of the Common Stock, in each case,
multiplied by the number of shares or fraction thereof into which a share of
Preferred Stock is then convertible. If at any time neither the Preferred Stock
nor the Common Stock is traded on an exchange or the NASDAQ National Market
System, or otherwise traded in the over-the-counter market, the Market Price
shall be deemed to be the higher of (i) the book value thereof as determined by
any firm of independent public accountants of recognized standing selected by
the Board of Directors of the Company as of the last day of any month ending
within 60 days preceding the date as of which the determination is to be made,
or (ii) the fair value thereof determined in good faith by the Board of
Directors of the Company as of a date which is within 15 days of the date as of
which the determination is to be made.
5. This Warrant shall not entitle the holder hereof to any voting
rights or other rights as a stockholder of the Company.
6. The holder of this Warrant, by acceptance hereof, agrees to give
written notice to the Company before transferring this Warrant or transferring
any Preferred Stock issuable or issued upon the exercise hereof of such holder's
intention to do so, describing briefly the manner of any proposed transfer of
this Warrant or such holder's intention as to the disposition to be made of
shares of Preferred Stock issuable or issued upon the exercise hereof. Such
holder shall also provide the Company with an opinion of counsel satisfactory to
the Company to the effect that the proposed transfer of this Warrant or
disposition of shares may be effected without registration or qualification
(under any Federal or State law) of this Warrant or the shares of Preferred
Stock issuable or issued upon the exercise hereof. Upon receipt of such written
notice and opinion by the Company, such holder shall be entitled to transfer
this Warrant, or to exercise this Warrant in accordance with its terms and
dispose of the shares received upon such exercise or to dispose of shares of
Preferred Stock received upon the previous exercise of this Warrant, all in
accordance with the terms of the notice delivered by such holder to the Company,
provided that an appropriate legend respecting the aforesaid restrictions on
transfer and disposition may be endorsed on this Warrant or the certificates for
such shares.
7. Subject to the provisions of paragraph 6 hereof, this Warrant and
all rights hereunder are transferable, in whole or in part, at the principal
office of the Company by the holder hereof in person or by duly authorized
attorney, upon surrender of this Warrant
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properly endorsed. Each taker and holder of this Warrant, by taking or holding
the same, consents and agrees that the bearer of this Warrant, when endorsed,
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 by this Warrant, or to the transfer hereof on the books
of the Company, any notice to the contrary notwithstanding; but until such
transfer on such books, the Company may treat the registered holder hereof as
the owner for all purposes.
8. This Warrant is exchangeable, upon the surrender hereof by the
holder hereof at the principal office of the Company, for new Warrants of like
tenor representing in the aggregate the right to subscribe for and purchase the
number of shares which may be subscribed for and purchased hereunder, each of
such new Warrants to represent the right to subscribe for and purchase such
number of shares as shall be designated by said holder hereof at the time of
such surrender.
9. The warrants shall have the registration rights set forth in
Section 12 of that certain Stock Purchase Agreement dated October 23, 1996 by
and among the Purchasers and BUCA, Inc.
10. (a) In addition to and without limiting the rights of the holder
of this Warrant under the terms of this Warrant, the holder of this Warrant
shall have the right (the "Conversion Right") to convert this Warrant or any
portion thereof into shares of Preferred Stock as provided in this paragraph 10
at any time or from time to time prior to its expiration. Upon exercise of the
Conversion Right with respect to a particular number of shares subject to this
Warrant (the "Converted Warrant Shares"), the Company shall deliver to the
holder of this Warrant, without payment by the holder of any exercise price or
any cash or other consideration, that number of shares of Preferred Stock equal
to the quotient obtained by dividing the Net Value (as hereinafter defined) of
the Converted Warrant Shares by the fair market value (as defined in paragraph
(c) below) of a single share of Preferred Stock, determined in each case as of
the close of business on the Conversion Date (as hereinafter defined). The "Net
Value" of the Converted Warrant Shares shall be determined by subtracting the
aggregate warrant purchase price of the Converted Warrant Shares from the
aggregate fair market value of the Converted Warrant Shares. Notwithstanding
anything in this paragraph 10 to the contrary, the Conversion Right cannot be
exercised with respect to a number of Converted Warrant Shares having a Net
Value below $100. No fractional shares shall be issuable upon exercise of the
Conversion Right, and if the number of shares to be issued in accordance with
the foregoing formula is other than a whole number, the Company shall pay to the
holder of this Warrant an amount in cash equal to the fair market value of the
resulting fractional share.
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(b) The Conversion Right may be exercised by the holder of this
Warrant by the surrender of this Warrant at the principal office of the Company
together with a written statement specifying that the holder thereby intends to
exercise the Conversion Right and indicating the number of shares subject to
this Warrant which are being surrendered (referred to in paragraph (a) above as
the Converted Warrant Shares) in exercise of the Conversion Right. Such
conversion shall be effective upon receipt by the Company of this Warrant
together with the aforesaid written statement, or on such later date as is
specified therein (the "Conversion Date"), but not later than the expiration
date of this Warrant. Certificates for the shares of Preferred Stock issuable
upon exercise of the Conversion Right, together with a check in payment of any
fractional share and, in the case of a partial exercise, a new warrant
evidencing the shares remaining subject to this Warrant, shall be issued as of
the Conversion Date and shall be delivered to the holder of this Warrant within
15 days following the Conversion Date.
(c) For purposes of this paragraph 10, the "fair market value" of a
share of Preferred Stock as of a particular date shall be its Market Price,
calculated as described in paragraph 4(i) hereof.
11. All questions concerning this Warrant will be governed and
interpreted and enforced in accordance with the internal law, not the law of
conflicts, of the State of Minnesota.
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IN WITNESS WHEREOF, BUCA, Inc. has caused this Warrant to be signed by
its duly authorized officer and this Warrant to be dated as of October 23, 1996.
BUCA, Inc.
By /s/ Philip A. Roberts
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Its CEO
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RESTRICTION ON TRANSFER
"The securities evidenced hereby may not be transferred without (i)
the opinion of counsel satisfactory to this corporation that such transfer may
be lawfully made without registration under the Federal Securities Act of 1933
and all applicable state securities laws or (ii) such registration."
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SUBSCRIPTION FORM
To be Executed by the Holder of this Warrant if such Holder
Desires to Exercise this Warrant in Whole or in Part:
To: BUCA, Inc. (the "Company")
The undersigned ___________________________________
Please insert Social Security or other
identifying number of Subscriber:
_______________________________
hereby irrevocably elects to exercise the right of purchase represented by this
Warrant for, and to purchase thereunder, ___________ shares of the Preferred
Stock (the "Preferred Stock") provided for therein and tenders payment herewith
to the order of the Company in the amount of $___________, such payment being
made as provided on the face of this Warrant.
The undersigned requests that certificates for such shares of
Preferred Stock be issued as follows:
Name:_________________________________________________________________________
Address:______________________________________________________________________
Deliver to:___________________________________________________________________
Address:______________________________________________________________________
and, if such number of shares of Preferred Stock shall not be all the shares of
Preferred Stock purchasable hereunder, that a new Warrant for the balance
remaining of the shares of Preferred Stock purchasable under this Warrant be
registered in the name of, and delivered to, the undersigned at the address
stated above.
Dated:
Signature _______________________________________
Note: The signature on this Subscription
Form must correspond with the name as
written upon the face of this Warrant in
every particular, without alteration or
enlargement or any change whatever.
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FORM OF ASSIGNMENT
(To Be Signed Only Upon Assignment)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto this Warrant, and appoints to transfer this Warrant on the books
of the Company with the full power of substitution in the premises.
Dated:
In the presence of:
________________________________________
(Signature must conform in all respects
to the name of the holder as specified
on the face of this Warrant without
alteration, enlargement or any change
whatsoever, and the signature must be
guaranteed in the usual manner)
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