EXHIBIT 10.7
RESTRUCTURE AGREEMENT
THIS RESTRUCTURE AGREEMENT ("Agreement") is made and entered into as
of September 30, 1997 (the "Effective Date"), by and among, Casmyn Corp., a
Colorado corporation ("Casmyn"), and WaterPur International Inc., a Delaware
corporation ("WaterPur"), with reference to the following:
A. ON SEPTEMBER 30, 1997, THE BOARDS OF DIRECTORS OF CASMYN AND WATERPUR
APPROVED THE RESTRUCTURING OF CASMYN'S INTEREST IN WATERPUR AND WATERPUR'S
INTEREST IN CASMYN (THE "RESTRUCTURING").
B. WATERPUR SHALL FILE A CERTIFICATE OF DESIGNATION OF PREFERENCES AND
RIGHTS OF SERIES B CONVERTIBLE PREFERRED STOCK (THE "CERTIFICATE OF
DESIGNATION") WITH THE SECRETARY OF STATE OF THE STATE OF DELAWARE
ESTABLISHING THE PREFERENCES AND RIGHTS OF THE SERIES B PREFERRED STOCK OF
WATERPUR (THE "WATERPUR PREFERRED STOCK") TO BE ISSUED PURSUANT TO THE
RESTRUCTURING.
C. CASMYN AND WATERPUR NOW DESIRE TO MEMORIALIZE THE TERMS OF THE
RESTRUCTURING, AS MORE FULLY SET FORTH IN THIS AGREEMENT.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as follows:
1. Conversion of Debt. Upon the filing of the Certificate of
Designation, the outstanding debt of $4,514,304 owed to Casmyn by WaterPur
shall be converted into 5,015,894 shares of WaterPur Preferred Stock.
2. Conversion of WaterPur Common Stock. The 5,634,756 shares of
WaterPur common stock owned by Casmyn shall be converted into 2,817,378 shares
of WaterPur Preferred Stock.
3. Issuance of Warrants. WaterPur shall issue to Casmyn warrants to
purchase up to 3,300,000 shares of WaterPur common stock at $0.75 per share,
exercisable for a three-year period, pursuant to that certain Warrant to
Purchase Common Stock in the form of that attached hereto as Exhibit A.
4. Purchase of Casmyn Common Stock. Effective as of the Effective
Date, Casmyn shall purchase from WaterPur 150,000 shares of Casmyn common
stock owned by WaterPur, which shares Casmyn shall retire to treasury.
5. Spin-Off. Upon the satisfaction of all regulatory requirements,
the WaterPur Preferred Stock owned by Casmyn pursuant to Sections 1 and 2
hereof shall be distributed on a pro rata basis to the holders of Casmyn
common stock and preferred stock as of a record date of October 15, 1997,
without any consideration being paid by such holders (the "Distribution").
The transfer of such WaterPur Preferred Stock will be restricted for a period
of one year from the date of the Distribution. The Distribution will be made
on the basis of approximately .78 shares of WaterPur Preferred Stock for every
share of Casmyn common stock outstanding or issuable upon conversion of
Casmyn's convertible preferred stock.
6. Miscellaneous..
a. Further Assurances. Each of the parties shall execute such
documents, instruments and other papers and perform such further acts as may
be reasonably required or desirable to carry out the provisions hereof and the
transactions contemplated hereby.
b. Effective Date. Notwithstanding anything to the contrary herein,
the effective date of the transactions described in Sections 1 through 4
hereof shall be deemed to have occurred on the Effective Date.
c. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Colorado applicable to contracts
made and to be performed wholly within such State, and without regard to
the conflicts of laws principles thereof.
The parties hereto have duly executed this Agreement as of the day
and year first above written.
"CASMYN":
CASMYN CORP., a Colorado corporation
By:
__________________________________________
Xxxx X. Xxxxx, Chief Executive Officer
"WATERPUR":
WATERPUR INTERNATIONAL INC.,
a Delaware corporation
By:
___________________________________________
Xxxxxxx X. Xxxxxxxx, Vice President
EXHIBIT A
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE COMMON STOCK OF THE
COMPANY ISSUABLE UPON EXERCISE OF SUCH WARRANTS HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), NOR UNDER ANY STATE
SECURITIES LAWS, AND MAY NOT BE PLEDGED, SOLD, ASSIGNED OR TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL
TO THE COMPANY OR AN OPINION REASONABLY SATISFACTORY TO THE COMPANY OF COUNSEL
TO THE HOLDER THAT SAID SECURITIES MAY BE PLEDGED, SOLD, ASSIGNED OR
TRANSFERRED, AS THE CASE MAY BE, WITHOUT AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAW. BY ITS ACCEPTANCE
HEREOF, THE HOLDER OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE REPRESENTS
THAT IT IS AN "ACCREDITED INVESTOR," AS DEFINED IN REGULATION D PROMULGATED
UNDER THE ACT, AND THAT IT IS ACQUIRING SUCH WARRANTS FOR INVESTMENT PURPOSES
ONLY, AND NOT WITH A VIEW TOWARDS DISTRIBUTION.
3,300,000 WARRANTS
WATERPUR INTERNATIONAL, INC.
Warrant Certificate
to purchase Common Stock
Expiring September 30, 2000
This Warrant Certificate ("Warrant Certificate") certifies that
Casmyn Corp. or its registered assigns, is the registered holder of 3,300,000
Warrants expiring September 30, 2000 (the "Warrants") to purchase common
stock, $.005 par value per share (the "Common Stock"), of WaterPur
International, Inc., a Delaware corporation (the "Company"). Each Warrant
entitles the holder upon exercise to receive from the Company on or before
5:00 p.m., Los Angeles time, on September 30, 2000, one fully paid and
non-assessable share of Common Stock (each, a "Warrant Share" and
collectively, the "Warrant Shares") at the purchase price per share (the
"Exercise Price") of $.75 per share, payable in cash, by certified or bank
check, upon surrender of this Warrant Certificate and payment of the
applicable Exercise Price at the office or agency of the Company, subject to
the conditions set forth herein. The foregoing Exercise Price and the number
of Warrant Shares issuable upon exercise of the Warrants are subject to
adjustment upon the occurrence of certain events set forth herein.
NO WARRANT MAY BE EXERCISED AFTER 5:00 P.M., LOS ANGELES TIME, ON
SEPTEMBER 30, 2000, AND TO THE EXTENT NOT EXERCISED BY SUCH TIME, SUCH
WARRANTS SHALL BECOME VOID.
The Warrants are subject to the following additional terms:
1. Registration of Transfers and Exchanges. Subject to the
restrictions set forth in this Warrant Certificate, the holder of this Warrant
Certificate shall have the right to transfer all or a portion of this Warrant
Certificate. The Company shall from time to time register the transfer of
this Warrant Certificate upon the records to be maintained by it for that
purpose, upon surrender thereof accompanied (if so required by it) by a
written instrument or instruments of transfer in form satisfactory to the
Company, duly executed by the registered holder hereof or by the duly
appointed legal representative thereof or by a duly authorized attorney. Upon
any such registration or trans-fer, a new Warrant Certificate shall be issued
to the transferee(s) and the surrendered Warrant Certificate shall be
cancelled by the Company.
The holder of this Warrant Certificate agrees that prior to any
proposed transfer of the Warrants or of the Warrant Shares, if such transfer
is not made pursuant to an effective Registration Statement under the
Securities Act of 1933, as amended (the "Act"), such holder shall deliver to
the Company an opinion of counsel, reasonably satisfactory in form and
substance to the Company, and from counsel reasonably satisfactory to the
Company, that the Warrants or Warrant Shares may be so sold without
registration under the Act.
The Warrant holder understands and agrees that each certificate
representing Warrant Shares will bear the following legend:
"THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), QUALIFIED OR REGISTERED UNDER
ANY STATE SECURITIES LAW, AND ARE RESTRICTED SECURITIES. THESE SHARES MAY
NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED IN ANY
MANNER ABSENT EITHER REGISTRATION UNDER THE ACT AND UNDER APPLICABLE STATE
SECURITIES LAW, OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER AND ITS
COUNSEL THAT REGISTRATION UNDER SUCH LAWS IS NOT REQUIRED."
The Company may deem and treat the registered holder hereof as the
absolute owner of the Warrants (notwithstanding any notation of ownership or
other writing hereon made by anyone), for the purpose of any exercise hereof,
of any distribution to the holder hereof, and for all other purposes, and the
Company shall not be affected by any notices to the contrary. The Warrants do
not entitle the holder hereof to any rights of a stockholder of the Company.
2. Terms of Warrants; Exercise of Warrants. Subject to the terms
contained herein, the holder of this Warrant Certificate shall have the right,
which may be exercised at any time and from time to time until 5:00 p.m., Los
Angeles time, on September 30, 2000, to purchase and receive from the Company
the number of validly issued, fully paid and non-assessable Warrant Shares
which the holder may at the time be entitled to receive on exercise of the
Warrants represented by this Warrant Certificate and payment of the applicable
Exercise Price then in effect for such Warrant Shares. Each Warrant not
exercised prior to 5:00 p.m., Los Angeles time, on September 30, 2000 shall
become void, and all rights hereunder and all rights in respect thereof
hereunder shall cease as of such time.
A Warrant may be exercised upon surrender to the Company at its
principal office of this Warrant Certificate with the form of election to
purchase attached hereto duly completed and signed, and upon payment to the
Company for the account of the Company of the applicable Exercise Price, as
adjusted as herein provided, for the number of Warrant Shares in respect of
which such Warrants are then exercised. Payment of the aggregate Exercise
Price shall be made in cash, by certified or official bank check payable to
the order of the Company.
Upon such surrender of this Warrant Certificate and payment of the
applicable Exercise Price, the Company shall issue and cause to be delivered
with all reasonable dispatch to the holder of this Warrant Certificate a
certificate or certificates for the number of full Warrant Shares issuable
upon the exercise of such Warrants, together with cash as provided in Section
6. Such certificate or certificates for the Warrant Shares shall be deemed to
have been issued and, subject to applicable federal and state securities laws
and regulations, any person so designated to be named therein shall be deemed
to have become a holder of record of such Warrant Shares as of the date of the
surrender of this Warrant Certificate and payment of the applicable Exercise
Price. Such certificate or certificates for the Warrant Shares may, if
required, bear the legend set forth in Section 1.
The Warrants shall be exercisable, at the election of the holder of
this Warrant Certificate, either in full or from time to time in part and, in
the event that a certificate evidencing Warrants is exercised in respect of
fewer than all of the Warrant Shares issuable on such exercise at any time
prior to the date of expiration of the Warrants, a new certificate evidencing
the remaining Warrant or Warrants will be issued.
3. Payment of Taxes. The Company will pay any documentary stamp
taxes attributable to the initial issuance of Warrant Shares upon the exercise
of the holder's Warrants.
4. Reservation of Warrant Shares. The Company will at all times
reserve and keep available, free from preemptive rights, out of the aggregate
of its autho-rized but unissued Common Stock, sufficient Common Stock to
satisfy any obligation to issue Warrant Shares upon exercise of Warrants. The
Company covenants that all Warrant Shares which may be issued upon exercise of
Warrants will, upon issue, be validly issued, fully paid, nonassessable, free
of preemptive rights and free from all taxes, liens, charges and security
interests with respect to the issue thereof, other than those created by the
holder of such Warrants.
5. Adjustment of Exercise Prices and Number of Warrant Shares
Issuable. The Exercise Price and the number of Warrant Shares issuable upon
the exercise of each Warrant are subject to adjustment from time to time upon
the occurrence of the events enumerated in this Section 5. The Exercise Price
shall be adjusted simultaneously upon occurrence of such events. For purposes
of this Section 5, "Common Stock" means shares now or hereafter authorized of
any class of common stock of the Company and any other stock of the Company,
however designated, that has the right (subject to any prior rights of any
class or series of preferred stock) to participate in any distribution of the
assets or earnings of the Company without limit as to per share amount.
a. In case the Company shall at any time after the date of original
issuance hereof do any of the following: (i) pay a dividend or make a
distribu-tion on its capital stock in shares of Common Stock, (ii) subdivide
its outstanding shares of Common Stock, (iii) combine its outstanding shares
of Common Stock into a smaller number of shares, or (iv) issue by
reclassification of its Common Stock any shares of capital stock of the
Company; then immediately after the distribution date of such stock dividend
or the effective date of such subdivision, split-up, combination or
reclassification, as the case may be, the number of shares of Common Stock
which the registered holder of this Warrant Certificate is entitled to
purchase hereunder and the Exercise Price of such shares of Common Stock shall
be appropriately adjusted so that the registered holder hereof shall be
entitled to purchase the number of shares of Common Stock that such holder
would have held after such stock dividend, subdivision, split-up, combination
or reclassification, as the case may be, at the aggregate Exercise Price such
holder would have paid for such shares of Common Stock, if such holder had
exercised the Warrants represented by this Warrant Certificate prior to such
event.
b. In case of any consolidation or merger to which the Company is a
party other than a merger or consolidation in which the Company is the
con-tinuing corporation, or in case of any sale or conveyance to another
corporation of the property of the Company as an entirety or substantially as
an entirety, or in case of any statutory exchange of securities with another
corporation (including any exchange effected in connection with a merger of a
third corporation into the Company), lawful and adequate provisions shall be
made whereby the registered holder of this Warrant Certificate shall
thereafter have the right to purchase and receive upon the basis and upon the
terms and conditions specified in this Warrant Certificate and in lieu of the
shares of Common Stock immediately theretofore purchasable hereunder and
receivable upon the exercise of the Warrants, 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 Common Stock equal to the number of
outstanding shares of Common Stock immediately theretofore purchasable and
receivable upon the exercise of the Warrants represented by this Warrant
Certificate, and in any such case appropriate provision shall be made with
respect to the rights and interests of the registered holder of this Warrant
Certificate to the end that the provisions hereof (including without
limitation, to the extent provided herein, provisions for adjustments of the
Exercise Price and of the number of shares of Common Stock purchasable and
receivable upon the exercise of the Warrants represented by this Warrant
Certificate) 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 will not effect any such consolidation, merger
or sale, unless prior to the consummation thereof the successor entity (if
other than the Company) resulting from such consolidation or merger or the
entity purchasing such assets shall assume by written instrument executed and
delivered to the registered holder of this Warrant Certificate, the obligation
to deliver to such holder such shares of stock, securities or assets as, in
accordance with the foregoing provision, such registered holder of this
Warrant Certificate may be entitled to purchase. Notice of any such
consolidation, merger, statutory exchange, sale or conveyance, and of the
provisions so proposed to be made, shall be mailed to the registered holder of
this Warrant Certificate not less than thirty (30) days prior to such event or
promptly upon the Company's receiving notice thereof. A sale of all or
substantially all of the assets of the Company for a consideration consisting
primarily of securities shall be deemed a consolidation or merger for the
foregoing purposes.
c. In case at any time or from time to time, conditions arise by
reason of action taken by the Company, which in the opinion of its Board of
Directors or the holder of this Warrant Certificate, are not adequately
covered by the provisions of this Warrant Certificate, and might adversely
affect the exercise rights of the holder of this Warrant Certificate, then the
Board of Directors of the Company shall appoint a firm of independent
certified public accountants of recognized national standing (which may be the
firm regularly retained by the Company), who shall give their opinion upon the
adjustment, if any, on a basis consistent with the standards established in
the other provisions of this Warrant Certificate, necessary with respect to
the Exercise Price or the number of Warrant Shares issuable upon exercise of
the Warrants, so as to preserve, without dilution, the exercise rights of the
holder of this Warrant Certificate and the number of Warrant Shares issuable
upon exercise of the Warrants by the holder hereof to the extent contemplated
by this Section 5. Upon receipt of such opinion, which shall be conclusive
and binding on the Company and the holder, the Board of Directors of the
Company shall forthwith make the adjustments provided therein.
6. Fractional Interests. The Company shall not be required to issue
fractional Warrant Shares on the exercise of Warrants. If more than one
Warrant shall be presented for exercise in full at the time by the same
holder, the number of full Warrant Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Warrant Shares purchasable on exercise of the Warrants so presented. If any
fraction of a Warrant Share would, except for the provisions of this Section
6, be issuable upon exercise of any Warrants (or specified portion thereof),
the Company shall pay an amount in cash equal to the applicable Exercise Price
on the day immediately preceding the date the Warrant is presented for
exercise, multiplied by such fraction.
7. Notices to the Warrant Holder. Upon any adjustment of the
Exercise Price and/or the number of Warrant Shares issuable upon exercise of
the Warrants pursuant to Section 5, the Company shall promptly thereafter
cause to be given to the Warrant holder, as provided in Section 9, a
certificate setting forth the Exercise Price and/or the number of Warrant
Shares issuable upon exercise of the Warrants after such adjustment and
setting forth in reasonable detail the method of calculation and the facts
upon which such calculations are based. Where appropriate, such notice to the
Warrant holder may be given in advance and included as a part of the notice
required to be mailed under the other provisions of this Section 7.
In case:
a. the Company shall authorize the issuance to holders of shares of
Common Stock of rights, options or warrants to subscribe for or purchase
shares of Common Stock or of any other subscription rights or warrants; or
b. the Company shall authorize the distribution to holders of shares
of Common Stock of evidences of its indebtedness or assets (other than cash
dividends or cash distributions payable out of consolidated earnings); or
c. of any consolidation or merger to which the Company is a party and
for which approval of any stockholders of the Company is required, or of the
conveyance or transfer of the properties and assets of the Company
substantially as an entirety, or of any reclassification or change of Common
Stock issuable upon exercise of the Warrants (other than a change in par
value, or from par value to no par value, or from no par value to par value,
or as a result of a subdivision or combination), or a tender offer or exchange
offer for shares of Common Stock; or
d. of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
e. the Company proposes to take any action which would require an
adjustment of the Exercise Price or the number of Warrant Shares issuable upon
exercise of the Warrants pursuant to Section 5;
then the Company shall promptly give to the registered holders of the Warrant
Certificates at their respective addresses appearing on the Warrant register
by first-class mail, postage prepaid, a written notice describing the specific
details of such contemplated action, including, without limitation (i) the
date as of which the holders of record of shares of Common Stock to be
entitled to receive any such rights, options, warrants or distribution are to
be determined, or (ii) the initial expiration date set forth in any tender
offer or exchange offer for shares of Common Stock, or (iii) the date on which
any such consolidation, merger, conveyance, transfer, dissolution, liquidation
or winding up is expected to become effective or consummated, and the date as
of which it is expected that holders of record of shares of Common Stock shall
be entitled to exchange such shares for securities or other property, if any,
deliverable upon such reclassification, consolidation, merger, conveyance,
transfer, dissolution, liquidation or winding up.
8. Holder Not Deemed a Stockholder. With respect to the Warrant
Shares purchasable under this Warrant Certificate, no holder hereof shall be
entitled to vote or receive dividends in respect to, or be deemed the holder
of, nor shall anything contained herein be construed to confer upon any holder
of this Warrant Certificate, any of the rights of a stockholder of the Company
or any right to vote for the election of directors or upon any matter
submitted to stockholders at any meeting thereof, or to give or withhold
consent to any corporate action (whether upon any recapitalization, issue of
stock, reclassification of stock, change of par value or change of stock to no
par value, consolidation, merger, conveyance, or otherwise) or to receive
notice of meetings, or to receive dividends, until this Warrant Certificate
shall have been exercised and the Warrant Shares receivable upon the exercise
hereof shall have become deliverable as provided in Section 3 above, and then
only with respect to the Warrant Shares purchased.
9. Notices. Any notice, request, instruction or other document to be
given hereunder shall be in writing, shall be deemed to have been duly given
or delivered when delivered personally or telecopied (receipt confirmed, with
a copy sent by certified or registered mail as set forth herein) or sent by
certified or registered mail, postage prepaid, return receipt requested, or by
FedEx or other reputable overnight delivery service, to the address of the
party set forth below or to such address as the party to whom notice is to be
given may provide in a written notice to the Company, a copy of which written
notice shall be on file with the Company:
If to the Company:
WaterPur International, Inc.
0000 Xxxx Xxxxxxx Xx., Xxxxx 0000
Xxxxxxxxx, X.X.
Xxxxxx X0X 0X0
Attention: President
If to Casmyn Corp.:
Casmyn Corp.
0000 Xxxx Xxxxxxx Xx., Xxxxx 0000
Xxxxxxxxx, X.X.
Xxxxxx X0X 0X0
Attention: President
10. Rights Subject to Warrant Certificate. The holder of this
Warrant Certificate, by its acceptance hereof, agrees to be bound by, and
agrees that he holds this Warrant Certificate subject to, the terms and
conditions of this Warrant Certificate.
11. Successors. This Warrant Certificate shall be binding upon and
inure to the benefit of the Company and the registered holder hereof and their
respective heirs, executors, personal representatives, successors and assigns
and shall be binding upon any person, firm, corporation or other entity to
whom this Warrant Certificate and any Warrant Shares issuable upon exercise
hereof are transferred (even if in violation of the provisions of this Warrant
Certificate) and the heirs, executors, personal representatives, successors
and assigns of such person, firm, corporation or other entity.
12. Miscellaneous. This Warrant Certificate and any provision hereof
may be amended, waived, discharged or terminated only by an instrument in
writing signed by the party (or any predecessor in interest thereof) against
which enforcement of the same is sought. The headings in this Warrant
Certificate are for purposes of reference only and shall not affect the
meaning or construction of any of the provisions hereof. This Warrant
Certificate shall be governed by and construed under the laws of the State of
Delaware, without reference to choice or conflict of laws principles.
IN WITNESS WHEREOF, the Company has caused this
Warrant Certificate to be duly executed and delivered.
Dated: September 30, 1997 WATERPUR INTERNATIONAL, INC., a Delaware corporation
By:_________________________________
Its:_________________________________
WATERPUR INTERNATIONAL, INC.
PURCHASE FORM
----------------------------
Number of Warrants exercised _______________
The undersigned hereby irrevocably elects to exercise the right
represented by this Warrant Certificate to purchase _______________ shares of
Common Stock of WaterPur International, Inc. and herewith tenders in payment
for such shares $____________ in cash in accordance with the terms hereof.
The undersigned requests that a certificate representing such shares be
registered and delivered as follows:
Name: _________________________________________________
Address: _________________________________________________
_________________________________________________
Delivery Address:
(if different) _________________________________________________
If the number of shares of Common Stock to be received is less than the
aggregate number of shares of Common Stock purchasable hereunder, the
undersigned requests that a new Warrant Certificate representing the balance
of such shares be registered and delivered as follows:
Name: ________________________________________________
Address: ________________________________________________
________________________________________________
Delivery Address: ________________________________________________
(if different)
________________________________________________
Name of registered holder of Warrant Certificate:
________________________________________________
(Please Print)
Address: ________________________________________________
________________________________________________
_________________
(Insert social Signature: _________________________
security or other
identifying number
of holder)
Note: The above signature must correspond with the name
as written upon the face of this Warrant Certificate.
