Document:

ex-10_2.htm

Bonds.com 8-K

Exhibit 10.2

 

 

[FORM OF WARRANT]

 

THE OFFER AND SALE OF THIS COMMON STOCK PURCHASE WARRANT AND THE SHARES OF COMMON STOCK THAT MAY BE PURCHASED HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE.  THIS COMMON STOCK PURCHASE WARRANT AND THE SHARES OF COMMON STOCK THAT MAY BE PURCHASED HEREUNDER MAY NOT BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND REGISTRATION OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION THEREFROM

 

BONDS.COM GROUP, INC.

 

COMMON STOCK PURCHASE WARRANT

 

Date of Issuance: [●]

 

THIS IS TO CERTIFY that RED KITE MARKETING, LLC, a [●] limited liability company, and its transferees, successors and assigns (the “Holder”), for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, is entitled to purchase from BONDS.COM GROUP, INC., a Delaware corporation (the “Company”), at the price of $[____] per share (the “Exercise Price”), at any time after the date hereof (the “Commencement Date”) and expiring on the date that is five (5) years after the Commencement Date (the “Expiration Date”), [●] ([●]) (the “Aggregate Number”) shares of the fully paid and nonassessable Common Stock, par value $0.0001 per share, of the Company (the “Common Stock”) (as such number may be adjusted as provided herein).

 

Capitalized terms used herein shall have the meanings ascribed to such terms in Section 11 hereof unless otherwise defined herein.

 

	
SECTION 1.  

	
The Warrant; Transfer and Exchange.

 

(a) The Warrant.  This Warrant and the rights and privileges of the Holder hereunder may be exercised by the Holder in whole or in part as provided herein and, as more fully set forth in Sections 1(b) and 8 hereof, may be transferred (subject to applicable securities laws and regulations) by the Holder to any other Person or Persons at any time or from time to time, in whole or in part.

 

(b) Transfer and Exchanges.  The Company shall initially record this Warrant on a register to be maintained by the Company with its other stock books and, subject to Section 8 hereof, from time to time thereafter shall reflect the transfer of this Warrant on such register when surrendered for transfer in accordance with the terms hereof and properly endorsed, accompanied by appropriate instructions, and further accompanied by payment in cash or by check, bank draft or money order payable to the order of the Company, in United States currency, of an amount equal to any stamp or other tax or governmental charge or fee required to be paid in connection with the transfer thereof.  Upon any such transfer, a new warrant or warrants shall be issued to the transferee and the Holder (in the event this Warrant is only partially transferred) and the surrendered warrant shall be canceled.  Each such transferee shall succeed to all of the rights of the Holder with respect to the Warrant being so transferred; provided, however, that, in the event this Warrant is partially transferred, the Holder and such transferee shall hold rights in respect of this Warrant in proportion to their respective interests in this Warrant.  This Warrant may be exchanged at the option of the Holder, when surrendered at the Principal Office, for another warrant or other warrants of like tenor and representing in the aggregate the right to purchase a like number of shares of Common Stock.

 

  

  

  

 

	
SECTION 2.  

	
Exercise.

 

(a) Right to Exercise.  At any time after the Commencement Date and on or before the Expiration Date, the Holder, in accordance with the terms hereof, may exercise this Warrant, in whole at any time or in part from time to time, by delivering this Warrant to the Company during normal business hours on any Business Day at the Principal Office, together with the Election to Purchase, in the form attached hereto as Exhibit A and made a part hereof (the “Election to Purchase”), duly executed, and payment of the Exercise Price per share for the number of shares to be purchased (the “Exercise Amount”), as specified in the Election to Purchase.  If the Expiration Date is not a Business Day, then this Warrant may be exercised on the next succeeding Business Day.

 

(b) Payment of Exercise Price.  Payment of the Exercise Price shall be made to the Company in cash or other immediately available funds, payable by certified wire transfer to an account designated by the Company.  The amount of the Exercise Price to be paid shall equal the product of (A) the Exercise Amount multiplied by (B) the Exercise Price per share.

 

(c) Issuance of Shares of Common Stock.  Upon receipt by the Company of this Warrant at the Principal Office in proper form for exercise, and accompanied by payment of the Exercise Price as aforesaid, the Company shall immediately cause the shares of Common Stock to be registered in the name of the Holder in the Register of Stockholders of the Company and the Holder shall then be deemed to be the holder of record of the shares of Common Stock issuable upon such exercise, notwithstanding that certificates representing such shares of Common Stock may not then be actually delivered.  Upon such surrender of this Warrant and payment of the Exercise Price as aforesaid, the Company shall issue and cause to be delivered with all reasonable dispatch to, or upon the written order of, the Holder (and in such name or names as the Holder may designate) a certificate or certificates for a number of shares of Common Stock equal to the Exercise Amount.

 

(d) Fractional Shares.  The Company shall not be required to deliver fractions of shares of Common Stock upon exercise of this Warrant.  If any fraction of a share of Common Stock would be deliverable upon an exercise of this Warrant, the Company may, in lieu of delivering such fraction of a share of Common Stock, make a cash payment to the Holder in an amount equal to the same fraction of the fair market value (as determined by the board of directors of the Company, in good faith) of the Common Stock determined as of the Business Day immediately preceding the date of exercise of this Warrant.

 

  

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(e) Partial Exercise.  In the event of a partial exercise of this Warrant, the Company shall issue to the Holder a Warrant in like form for the unexercised portion thereof.

 

	
SECTION 3.  

	
Payment of Taxes.

 

The Company shall pay all stamp taxes attributable to the issuance of shares or other securities issuable upon the exercise of this Warrant or issuable pursuant to Section 6 hereof.

 

	
SECTION 4.  

	
Replacement Warrant.

 

In case this Warrant is mutilated, lost, stolen or destroyed, the Company shall issue and deliver in exchange and substitution for and upon cancellation of the mutilated Warrant, or in lieu of and in substitution for the Warrant lost, stolen or destroyed, a new Warrant of like tenor and representing an equivalent right or interest, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction of such Warrant and upon receipt of indemnity reasonably satisfactory to the Company (provided, that if the Holder is a financial institution or other institutional investor, its personal undertaking to provide an indemnity is hereby deemed to be reasonably satisfactory to the Company).

 

	
SECTION 5.  

	
Reservation of Capital Stock and Other Covenants.

 

(a) Reservation of Authorized Capital Stock.  The Company shall at all times ensure that it has sufficient authorized and unissued capital, free of preemptive rights, to enable the Company at any time to fulfill all of its obligations hereunder upon the exercise of this Warrant.

 

(b) Validly Issued Shares.  The Company covenants that all shares of Common Stock delivered upon exercise of this Warrant, assuming full payment of the Exercise Price, shall, upon delivery by the Company, be duly authorized and validly issued, fully paid and nonassessable, free from all stamp taxes, liens and charges with respect to the issue or delivery thereof and otherwise free of all other security interests, encumbrances and claims of any nature whatsoever other than such security interests, encumbrances and claims granted by the Holder.

 

	
SECTION 6.  

	
Adjustments.

 

Under certain conditions, the Aggregate Number is subject to adjustment as set forth in this Section 6.  

 

(a) Adjustments to Aggregate Number.  The Aggregate Number, after taking into consideration any prior adjustments pursuant to this Section 6, shall be subject to adjustment from time to time as follows and, thereafter, as adjusted, shall be deemed to be the Aggregate Number hereunder.

 

(i) Stock Dividends; Subdivisions, Combinations an Reclassifications.  In case at any time or from time to time the Company shall:

 

(A) issue to the holders of the Common Stock a dividend payable in, or other distribution of, Common Stock (a “Stock Dividend”),

 

  

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(B) subdivide its outstanding shares of Common Stock into a larger number of shares of Common Stock, including, without limitation, by means of a stock split (a “Stock Subdivision”),

 

(C) combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock (a “Stock Combination”), or

 

(D) issue any shares of its capital stock in a reclassification of the Common Stock (a “Stock Reclassification”),

 

then the number of shares of Common Stock purchasable upon exercise of this Warrant, if any, immediately prior thereto shall be adjusted so that the Holder shall be entitled to receive the kind and number of shares of Common Stock or other securities of the Company which it would have owned or have been entitled to receive had this Warrant been exercised in advance thereof.

 

(ii) Miscellaneous.  The following provisions shall be applicable to the making of adjustments of the Aggregate Number provided above in this Section 6(a):

 

(A) The adjustments required by the preceding paragraphs of this Section 6(a) shall be made whenever and as often as any specified event requiring an adjustment shall occur, except that no adjustment of the Aggregate Number that would otherwise be required shall be made (except in the case of a Stock Subdivision, Stock Combination or Stock Reclassification as provided for in Section 6(a)(i) hereof) unless and until such adjustment either by itself or with other adjustments not previously made adds or subtracts at least one one-hundredth of one share to or from the Aggregate Number immediately prior to the making of such adjustment.  Any adjustment representing a change of less than such minimum amount (except as aforesaid) shall be carried forward and made as soon as such adjustment, together with other adjustments required by this Section 6(a) and not previously made, would result in a minimum adjustment.  For the purpose of any adjustment, any specified event shall be deemed to have occurred at the close of business on the date of its occurrence. 

 

(B) In computing adjustments under this Section 6(a), fractional interests in Common Stock shall be taken into account to the nearest one-thousandth of a share.

 

(C) If the Company shall take a record of the holders of the Common Stock for the purpose of entitling them to receive a dividend or distribution or subscription or purchase rights and shall, thereafter and before the distribution to shareholders thereof, legally abandon its plan to pay or deliver such dividend, distribution, subscription or purchase rights, then no adjustment shall be required by reason of the taking of such record and any such adjustment previously made in respect thereof shall be rescinded and annulled.

 

(b) Adjustment to Exercise Price.

 

(i) Upon any adjustment to the Aggregate Number or of the kind and number of Warrant Shares or other securities of the Company which are purchasable hereunder pursuant to Section 6(a)(i), the Holder shall thereafter be entitled to purchase such Aggregate Number of shares of Common Stock or other securities resulting from such adjustment at an Exercise Price per share of Common Stock or other security obtained by multiplying the Exercise Price in effect immediately prior to such adjustment by the Aggregate Number prior to such adjustment and dividing by the Aggregate Number immediately following such adjustment. An adjustment made pursuant to this paragraph shall become effective immediately after the effective date of such event retroactive to the record date, if any, for such event.

 

  

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(ii) In case at any time or from time to time the Company shall pay a dividend or make a distribution in cash, securities or other assets to the holders of Common Stock, other than (x) as described in Sections 1(a)(i)(A) and 1(a)(i)(D) above or (y) regular quarterly or other periodic dividends (any such non-excluded event being referred to as an “Extraordinary Dividend”), then the Exercise Price shall be decreased by the amount of cash and/or the fair market value (as determined by the board of directors of the Company, in good faith) of any securities or other assets paid on each share of Common Stock in respect of such Extraordinary Dividend.  An adjustment made pursuant to this Section 6(b)(ii) shall become effective immediately after the effective date of such event retroactive to the record date, if any, for such event.

 

(c) Changes in Common Stock.  In case at any time the Company shall initiate any transaction or be a party to any transaction (including, without limitation, a merger, consolidation, share exchange, sale, lease or other disposition of all or substantially all of the Company’s assets, liquidation, recapitalization or reclassification of the Common Stock) in connection with which the previous outstanding Common Stock shall be changed into or exchanged for different securities of the Company or Capital Stock or other securities of another corporation or interests in a non-corporate entity or other property (including cash) or any combination of the foregoing (each such transaction being herein called a “Transaction”), then, as a condition of the consummation of the Transaction, lawful, enforceable and adequate provision shall be made so that the Holder shall be entitled to elect, by written notice to the Company, to receive (i) in exchange for the surrender of this Warrant to the Company and the same Exercise Price (rather than the exercise thereof), the securities or other property (including cash) to which such Holder would have been entitled upon consummation of the Transaction if such Holder had exercised this Warrant and (if applicable) converted the shares of Common Stock issuable hereunder immediately prior thereto, (ii) a new warrant in form and substance similar to, and in exchange for, this Warrant to purchase all or a portion of such securities or other property to which such Holder would have been entitled upon consummation of the Transaction if such Holder had exercised this Warrant and (if applicable) converted the shares of Common Stock issuable hereunder immediately prior thereto, for the same Exercise Price, or (iii) upon exercise of this Warrant at any time on or after the consummation of the Transaction but prior to the Expiration Date, in lieu of the Warrant Shares issuable upon such exercise prior to such consummation, the securities or other property (including cash) to which such Holder would have been entitled upon consummation of the Transaction if such Holder had exercised this Warrant and (if applicable) converted the shares of Common Stock issuable hereunder immediately prior thereto (subject to adjustments from and after the consummation date as nearly equivalent as possible to the adjustments provided for in this Section 6).  The Company will not effect any Transaction unless prior to the consummation thereof each corporation or other entity (other than the Company) which may be required to deliver any new warrant, securities or other property as provided herein shall assume by written instrument the obligation to deliver to such Holder such new warrant, securities or other property as in accordance with the foregoing provisions such Holder may be entitled to receive.  The foregoing provisions of this Section 6(c) shall similarly apply to successive Transactions.

 

  

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(d) Other Action Affecting Capital Stock. 

 

(i) Other Action.  In case at any time or from time to time the Company shall take any action of the type contemplated in Section 6(a) or (c) hereof but not expressly provided for by such provisions, then, unless in the opinion of the Board of Directors such action will not have a material adverse effect upon the rights of the Holder (taking into consideration, if necessary, any prior actions which the Board of Directors deemed not to materially adversely affect the rights of the Holder), the Aggregate Number shall be adjusted in such manner and at such time as the Board of Directors may in good faith determine to be equitable in the circumstances.

 

(e) Adjustment Notice.  Whenever the Aggregate Number is to be adjusted pursuant to this Section 6, unless otherwise agreed by the Holder, the Company shall promptly deliver to the holder a written notice setting forth, in reasonable detail, the adjustment that was made, the event requiring the adjustment and the method by which such adjustment was calculated.

 

	
SECTION 7.  

	
No Impairment.

 

The Company will not, by amendment of its organizational documents or through any reorganization, recapitalization, transfer of assets, consolidation, merger, share exchange, dissolution or any other voluntary and deliberate action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, including, without limitation, the adjustments required under Section 6 hereof, and will at all times in good faith assist in the carrying out of all such terms and in taking of all such action as may be necessary or appropriate to protect the rights of the Holder against other impairment.

 

	
SECTION 8.  

	
Transfers of this Warrant.

 

(a) Generally.  Subject to the restrictions set forth in this Sections 1 and 8 of this Warrant, the Holder may at any time and from time to time freely transfer this Warrant and the Warrant Shares in whole or in part.

 

(b) Compliance with Securities Laws.  The Holder agrees that this Warrant and the Warrant Shares may not be sold or otherwise disposed of except pursuant to an effective registration statement under the Securities Act and applicable state securities laws or pursuant to an applicable exemption from the registration requirements of the Securities Act and such state securities laws.  In the event that the Holder transfers this Warrant or the Warrant Shares pursuant to an applicable exemption from registration, the Company may request, at the Holder’s expense, an opinion of counsel that the proposed transfer does not violate the Securities Act and applicable state securities laws. 

 

(c) Restrictive Securities Legend.  For so long as the Warrant Shares have not been registered under the Securities Act pursuant to the Registration Rights Agreement, the certificate representing the Warrant Shares shall bear the restrictive legend set forth below:

 

  

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“The offer and sale of the shares represented by this certificate have not been registered under the Securities Act of 1933, as amended, or the securities laws of any State and may not be sold or otherwise disposed of except pursuant to an effective registration statement under such Act and applicable State securities laws or pursuant to an applicable exemption from the registration requirements of such Act and such laws.”

 

	
SECTION 9.  

	
Definitions.

 

As used herein, in addition to the terms defined elsewhere herein, the following terms shall have the following meanings.  

 

“Aggregate Number” has the meaning set forth in the Preamble.

 

“Board of Directors” mean the Board of Directors of the Company.

 

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks in the State of New York are authorized or required by law or executive order to close.

 

“Capital Stock” means (a) with respect to any Person that is a corporation, any and all shares, interests or equivalents in capital stock (whether voting or nonvoting, and whether common or preferred) of such corporation, and (b) with respect to any Person that is not a corporation, any and all partnership, membership, limited liability company or other equity interests of such Person that confer on a Person the right to receive a share of the profits and losses of, or the distribution of assets of, the issuing Person; and in each case, any and all warrants, rights or options to purchase any of the foregoing.

 

“Commencement Date” has the meaning set forth in the Preamble. 

 

“Common Stock” means the Company’s Common Stock, par value $0.0001 per share.

 

“Company” has the meaning set forth in the Preamble.

 

“Election to Purchase” has the meaning set forth in Section 2(a).

 

“Exercise Amount” has the meaning set forth in Section 2(a).

 

“Exercise Price” has the meaning set forth in the Preamble.

 

“Expiration Date” has the meaning set forth in the Preamble.

 

“Extraordinary Dividend” has the meaning set forth in Section 6(b)(ii).

 

“Governmental Authority” means the government of any nation, state, city, locality or other political subdivision of any thereof, any entity or person exercising executive, legislative, judicial, arbitral, regulatory or administrative functions of or pertaining to government, regulation or compliance.

 

  

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“Holder” or “Holders” means any holder of an interest in this Warrant or the outstanding Warrant Shares.

 

“Person” means any individual, firm, corporation, partnership, limited liability company, joint venture, incorporated or unincorporated association, joint stock company, Governmental Authority, or other entity of any kind, and shall include any successor (by merger or otherwise) of such entity.

 

“Principal Office” means the Company’s principal office as set forth in Section 15 hereof or such other principal office of the Company in the United States of America the address of which first shall have been set forth in a notice to the Holder.

 

“Securities Act” means the Securities Act of 1933, as amended, or any similar federal statute, and the rules and regulations thereunder as the same shall be in effect at the time.

 

“Stock Combination” has the meaning set forth in Section 1(a)(i)(C).

 

“Stock Dividend” has the meaning set forth in Section 1(a)(i)(A).

 

“Stock Reclassification” has the meaning set forth in Section 1(a)(i)(D).

 

“Stock Subdivision” has the meaning set forth in Section 1(a)(i)(B). 

 

“Transaction” has the meaning set forth in Section 6(c).

 

“Warrant” has the meaning set forth in Section 1(a).

 

“Warrant Shares” means (a) the shares of Common Stock issued or issuable upon exercise of this Warrant in accordance with its terms and (b) all other shares of the Company’s Capital Stock issued with respect to such shares by way of stock dividend, stock split or other reclassification, pursuant to Section 6, or in connection with any merger, consolidation, recapitalization or other reorganization affecting the Company’s Capital Stock.

 

	
SECTION 10.  

	
Survival of Provisions.

 

Notwithstanding the full exercise by the Holder of its rights to purchase Common Stock hereunder, the provisions of Sections 9 through 21 of this Warrant shall survive such exercise and the Expiration Date.

 

	
SECTION 11.  

	
Delays, Omissions and Waivers.

 

It is agreed that no delay or omission to exercise any right, power or remedy accruing to the Holder upon any breach or default of the Company under this Warrant shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach or default, or any acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring.  It is further agreed that any waiver, permit, consent or approval of any kind or character on the Holder’s part of any breach or default under this Warrant, or any waiver on the Holder’s part of any provisions or conditions of this Warrant must be in writing and that all remedies, either under this Warrant, or by law or otherwise afforded to the Holder, shall be cumulative and not alternative.

 

  

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SECTION 12.  

	
Rights of Transferees.

 

Subject to Section 8, the rights granted to the Holder hereunder of this Warrant shall pass to and inure to the benefit of all subsequent transferees of all or any portion of this Warrant (provided that the Holder and any transferee shall hold such rights in proportion to their respective ownership of this Warrant and Warrant Shares) until extinguished pursuant to the terms hereof.

 

	
SECTION 13.  

	
Captions.

 

The titles and captions of the Sections and other provisions of this Warrant are for convenience of reference only and are not to be considered in construing this Warrant.

 

	
SECTION 14.  

	
Notices.

 

All notices, demands and other communications provided for or permitted hereunder shall be made in writing and shall be by registered or certified first-class mail, return receipt requested, telecopy, overnight courier service or personal delivery:

 

	
If to the Company:

	
Bonds.com Group, Inc.

529 5th Avenue, 8th Floor

New York, New York 10017

Attention:  Chief Executive Officer

Fax No:  (212) 946-3999

	  	  
	
With a copy to:

	
Hill Ward Henderson

3700 Bank of America Plaza

101 East Kennedy Boulevard

Tampa, Florida 33602

Attention:   Mark A. Danzi, Esq.

Fax No.:  (813) 221-2900

	  	  
	
If to the Holder:

	
Red Kite Americas, LLC

415 Madison Avenue, Suite 2100

14th Floor

New York, New York 10017

All such notices and communications shall be deemed to have been duly given: when delivered by hand, if personally delivered; when delivered by courier, if delivered by commercial overnight courier service; five Business Days after being deposited in the mail, postage prepaid, if mailed; and when receipt is acknowledged, if telecopied.

 

  

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SECTION 15.  

	
Successors and Assigns.

 

This Warrant shall be binding upon and inure to the benefit of the parties hereto and their respective successors or heirs and personal representatives and permitted assigns; provided, that the Company shall have no right to assign its rights, or to delegate its obligations, hereunder without the prior written consent of the Holder except as otherwise expressly provided herein. 

 

	
SECTION 16.  

	
Governing Law, Jurisdiction, Jury Trial.

 

All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York.  Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper.  Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

	
SECTION 17.  

	
Severability.

 

If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired, unless the provisions held invalid, illegal or unenforceable shall substantially impair the benefits of the remaining provisions hereof.  The parties hereto further agree to replace such invalid, illegal or unenforceable provision of this Agreement with a valid, legal and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of such invalid, illegal or unenforceable provision.

 

  

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SECTION 18.  

	
Entire Agreement.

 

This Warrant, together with the other Transaction Documents, contains the entire agreement among the parties with respect to the subject matter hereof and thereby supersedes all prior and contemporaneous agreements or understandings with respect thereto.

 

	
SECTION 19.  

	
Headings.

 

The headings in this Warrant are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

 

	
SECTION 20.  

	
No Strict Construction.

 

The Company and the Holder each acknowledge that they have been represented by counsel in connection with this Warrant, the other Transaction Documents and the transactions contemplated hereby and thereby.  The Company and the Holder have participated jointly in the negotiation and drafting of this Warrant and the other Transaction Documents.  In the event an ambiguity or question of intent or interpretation arises under any provision of this Warrant or any Transaction Document, this Warrant or such other Transaction Documents shall be construed as if drafted jointly by the parties thereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Warrant or any other Transaction Document.

 

	
SECTION 21.  

	
Representations, Warranties and Covenants.

 

The Company hereby represents, warrants and covenants to the Holder that, so long as the Holder holds this Warrant or any Warrant Shares, the Company will not, directly or indirectly, create or otherwise cause or suffer to exist or become effective any restriction or encumbrance on the ability of the Company to perform and comply with its obligations under this Warrant.

 

 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.  SIGNATURE PAGE FOLLOWS.]

 

  

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IN WITNESS WHEREOF, the Company has caused this Warrant to be issued and executed in its corporate name by its duly authorized officers and its corporate seal to be affixed hereto as of the date below written.

 

	
DATED:

	  	 	
BONDS.COM GROUP, INC.

	 
	  	  	 	  	 
	  	  	 	
By:

	  	 
	  	  	 	
Name:

	
Michael O. Sanderson

	 
	  	  	 	
Title:

	
Chief Executive Officer

	 

 

  

  

  

 

EXHIBIT A

NOTICE OF EXERCISE; ELECTION TO PURCHASE

 

	
To:

	
   

	  
	  	
           

	  
	  	
 

	  

 

1.           The undersigned, pursuant to the provisions of the attached Warrant, hereby elects to exercise this Warrant with respect to ________ shares of Common Stock (the “Exercise Amount”).  Capitalized terms used but not otherwise defined herein have the meanings ascribed thereto in the attached Warrant.

 

2.           The undersigned herewith tenders payment for such shares in the following manner (please check type, or types, of payment and indicate the portion of the Exercise Price to be paid by each type of payment): 

 

_______  Exercise for Cash

_______  Cashless Exercise

 

3.           Please issue a certificate or certificates representing the shares issuable in respect hereof under the terms of the attached Warrant, as follows:

 

	  	
 

	 
	  	
(Name of Record Holder/Transferee)

	 

 

and deliver such certificate or certificates to the following address:

 

	  	
 

	 
	  	
(Address of Record Holder/Transferee)

	 

 

4.           The undersigned represents that the aforesaid shares are being acquired for the account of the undersigned for investment and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has no present intention of distributing or reselling such shares.

 

 

5.           If the Exercise Amount is less than all of the shares of Common Stock purchasable hereunder, please issue a new warrant representing the remaining balance of such shares, as follows:

 

	  	
 

	 
	  	
(Name of Record Holder/Transferee)

	 

 

   and deliver such warrant to the following address:

 

	
  

	 	 
	  	
(Address of Record Holder/Transferee)

	 

	  	
 

	 
	  	
(Signature)

	 

	
 

	  	
              

	
(Date)ex-10_21.htm

Greektown Superholdings, Inc. 10-Q

Exhibit 10.21

 

 

FIRST AMENDMENT TO

CREDIT AGREEMENT

 

THIS FIRST AMENDMENT (“Amendment”) dated as of July 6, 2011, by and between Greektown Superholdings, Inc., a Delaware corporation (“Company”) and Comerica Bank (“Bank”).

 

RECITALS:

 

A.           Company and Bank entered into a Credit Agreement dated as of June 30, 2010 (“Agreement”).

 

B.           Company and Bank desire to amend the Agreement as hereinafter set forth.

 

NOW, THEREFORE, the parties agree as follows:

 

1.           The following definitions in Section 1 of the Agreement are amended to read as follows:

 

“EBITDA” shall mean Net Income for the applicable period plus, without duplication and only to the extent deducted in determining Net Income, (i) depreciation and amortization expense for such period, (ii) Interest Expense, whether paid or accrued, for such period, (iii) all Income Taxes for such period, (iv) reasonable legal, accounting, consulting, advisory and other out-of-pocket expenses incurred in connection with on-going bankruptcy court proceedings related to the bankruptcy of Greektown Holdings, L.L.C., (v) for any fiscal quarter ending on or before June 30, 2011, the non-recurring expenses listed on Schedule 2, and (vi) for any fiscal quarter ending on or before June 30, 2012, the non-recurring expenses listed on Schedule 3.

 

“Fixed Charges” shall mean, for any period, the sum, without duplication, of (i) all cash Interest Expense paid or payable in respect of such period on the Funded Debt of Borrower and its Subsidiaries on a Consolidated basis, plus (ii) all installments of principal or other sums paid or due and payable during such period by Borrower or any of its Consolidated Subsidiaries with respect to Funded Debt (other than the Advances and the original principal payment made with respect to Permitted Refinancing Indebtedness), plus (iii) all Income Taxes paid or payable in cash during such period, plus (iv) all Restricted Payments paid or payable in cash in respect of such period by Borrower (other than dividends on Capital Stock of the Borrower that were accrued and not paid), plus (v) all unfinanced Capital Expenditures of Borrower and its Consolidated Subsidiaries for such period (except the Excluded Capital Expenditures), plus (vi) all capitalized rent and lease expense of Borrower and its Consolidated Subsidiaries for such period, all as determined in accordance with GAAP.  For the Measuring Periods ending on September 30, 2010, December 31, 2010 and March 31, 2011, the unfinanced Capital Expenditures included in the calculation of Fixed Charges will not exceed $3,000,000, $6,000,000 and $9,000,000, respectively.

 

  

  

  

 

“Revolving Credit Commitment” shall mean Thirty Million Dollars ($30,000,000), subject to reduction or termination under Sections 2.10 or 9.2 hereof.

 

“Test Date” shall mean the last day of any fiscal quarter of Borrower commencing June 30, 2011.

 

2.           The following definitions are added to Section 1 of the Agreement in alphabetical order:

 

“Cleanup Period” means the period beginning April 1 of each year (commencing April 1, 2011) and ending March 31 of the following year.

 

“Excluded Capital Expenditures” shall mean the unfinanced Capital Expenditures described in attached Schedule 4.

 

3.           Section 7.14 of the Agreement is amended to read as follows:

 

“7.14           Maintain a Fixed Charge Coverage Ratio as of the end of each fiscal year, for the Measuring Period then ending, of not less than 1.05 to 1.0.”

 

4.           The lead in language to Section 7.16 of the Agreement is amended to read as follows:

 

“Not later than two (2) years after the date of this Agreement, deliver or cause to be delivered to Bank, at Borrower’s expense, in form and substance satisfactory to Bank, all of the following:”

 

5.           The following Sections 7.17 and 7.18 are added to the Agreement:

 

“7.17           EBITDA.  Maintain as of the end of each Test Date, EBITDA for the Measuring Period then ending, of not less than the following amounts as of Test Dates specified below:

 

	 	
Test Date

	 	
Amount

	 
	 	 	 	 	 
	 	
June 30, 2011 through June 29, 2012

	 	$	65,000,000	 
	 	
June 30, 2012 through June 29, 2013

	 	$	67,500,000	 
	 	
June 30, 2013 and thereafter

	 	$	72,500,000	 

7.18           Clean Up Period.  Cause the outstanding amount of Advances to be $0 for at least forty five (45) consecutive days during each Cleanup Period.”

 

6.           Section 8.1(d) of the Agreement is amended to read as follows:

 

	
  

	
    “(d)

	
any Debt of Borrower or any Subsidiary incurred to finance the acquisition of fixed or capital assets, whether pursuant to a loan or a Capitalized Lease, provided that both at the time of and 

 

  

2

  

 

 

	
  

	
 

	

immediately after giving effect to the incurrence thereof (i) no Default or Event of Default shall have occurred and be continuing, and (ii) the aggregate amount of all such Debt at any one time outstanding (including, without limitation, any Debt of the type described in this clause (d) which is set forth on Schedule 8.1 hereof) shall not exceed $25,000,000;”

 

7.           Section 8.17 of the Agreement is amended to read as follows:

 

“8.17           Prepayment of Senior Notes.  Prepay, redeem or defease any of the Senior Notes prior to their scheduled maturity, other than with Permitted Refinancing Indebtedness; provided, however, that Borrower may prepay the Senior Notes in accordance with Section 3.09 of the Current Indenture if (a) such prepayment occurs within sixty (60) days after delivery to Bank of Borrower’s financial statements and Covenant Compliance Report for the applicable fiscal year pursuant to Sections 7.1(a) and (c) and (b) at the time of such payment and after giving effect thereto no Default or Event of Default shall exist.”

 

8.           Section 9.1(b) of the Agreement is amended to read as follows:

 

“(b)           (i) default in the observance or performance of any of the conditions, covenants or agreements of Borrower set forth in Sections 7.1, 7.3(b), 7.4, 7.5(a) and (e), 7.7, 7.13, 7.14, 7.15, 7.16, 7.17, 7.18 or Article 8 in its entirety or any provision of any Collateral Assignment, provided that any Event of Default arising solely due to a breach of Section 7.5(a) shall be deemed cured upon the earlier of (x) the giving of the notice required by Section 7.5(a) and (y) the date upon which the Default or Event of Default giving rise to the notice obligation is cured or waived, and (ii) default in the observance or performance of the covenants in Section 7.1 and continuance thereof for a period of five (5) Business Days;”

 

9.           Exhibit A to the Agreement is deleted and attached Exhibit A is substituted in its place.

 

10.         Schedule 1 to the Agreement is deleted and attached Schedule 1 is substituted in its place and attached Schedules 3 and 4 are added to the Credit Agreement.

 

11.         Company hereby represent and warrant that, after giving effect to the amendments contained herein, (a) execution, delivery and performance of this Amendment and any other documents and instruments required under this Amendment or the Agreement are within Company’s corporate powers, have been duly authorized, are not in contravention of law or the terms of Company’s Articles of Incorporation or Bylaws, and do not require the consent or approval of any governmental body, agency, or authority; and this Amendment and any other documents and instruments required under this Amendment or the Agreement, will be valid and binding in accordance with their terms; (b) the continuing representations and warranties of Company set forth in Sections 6.1 through 6.6 and 6.8 through 6.18 of the Agreement are true and correct in all material respects on and as of the date hereof with the same force and effect as 

 

  

3

  

 

made on and as of the date hereof, except where such representations and warranties refer to a specific date, in which case such representations and warranties shall be true and correct in all material respects as of such date; (c) the continuing representations and warranties of Company set forth in Section 6.7 of the Agreement are true and correct as of the date hereof with respect to the most recent financial statements furnished to the Bank by Company in accordance with Section 7.1 of the Agreement; and (d) no Event of Default (as defined in the Agreement) or condition or event which, with the giving of notice or the running of time, or both, would constitute an Event of Default under the Agreement, as hereby amended, has occurred and is continuing as of the date hereof.

 

12.           Except as expressly provided herein, all of the terms and conditions of the Agreement remain unchanged and in full force and effect.

 

13.           This Amendment shall be effective upon execution of this Agreement by Company and the Bank and execution and delivery by Company and the Guarantors of the documents listed on the Closing Agenda dated July 6, 2011.

 

IN WITNESS the due execution hereof as of the day and year first above written.

                             

	COMERICA BANK	GREEKTOWN SUPERHOLDINGS, INC.
	 	 	 	 	 	 
	
By: 

	
   /s/ Robert Tull

	 	
By 

	
: /s/ Cliff Vallier

	 
	 	
       Robert Tull

	 	 	
      Cliff Vallier

	 
	 	
 

	 	 	
 

	 
	Its: Assistant Vice President 	Its: Chief Financial Officer and Treasurer 

 

 

4

 

             

SCHEDULE 1

 

(Expressed in basis points)

 

	
BASIS FOR PRICING

 

	 	
LEVEL 1

 

	 	 	
LEVEL 2

 

	 	 	
LEVEL 3

 

	 
	
Leverage Ratio

 

	 	
< 4.0:1.0

 

	 	 	
≥ 4.0:1.0

 

	 	 	 	
N/A

 

	 
	
Revolving Credit Note – LIBOR Option

 

	 	 	
175

 

	 	 	 	
225

 

	 	 	 	
250

 

	 
	
Letter of Credit Rate

 

	 	 	
175

 

	
 

 

	 	 	
225

 

	 	 	 	
250

 

	 
	
Revolving Credit Note – Prime-Referenced Rate Option

 

	 	 	
-100

 

	 	 	 	
-50

 

	 	 	 	
0

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