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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) July 22, 1997
GB FOODS CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 1-10576 33-0403086
(State or other jurisdiction of (Commission File (IRS Employer
incorporation or organization) Number) Identification No.)
23 CORPORATE PLAZA, SUITE 246
NEWPORT BEACH, CALIFORNIA 92660
(Address of Principal Executive Office) (Zip Code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (714) 640-6004
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ITEM 1. CHANGES IN CONTROL REGISTRANT.
On July 22, 1997, Fidelity National Financial, Inc. ("Fidelity") purchased
1,000,000 shares of Common Stock of GB Foods Corporation (the "Registrant") from
William M. Theisen ("Theisen"), the Registrant's Chief Executive Officer and
principal stockholder, for a purchase price of $5,000,000 cash. Fidelity also
purchased Common Stock Purchase Warrants ("Warrants") from Theisen pursuant to
which Fidelity has the right to acquire 2,500,000 shares of Registrant's Common
Stock, of which 1,500,000 are immediately exercisable at $5.00 per share (the
"$5.00 Warrants") and 1,000,000 are immediately exercisable at $7.00 per share
(the "$7.00 Warrants"). The $5.00 Warrants were purchased for $600,000 cash and
expire November 23, 2002; the $7.00 Warrants were purchased for $100,000 cash
and expire May 1, 2005.
Mr. Theisen retained 269,826 shares and 500,000 of the $5.00 Warrants.
In a separate transaction, Fidelity also acquired 1,000,000 Warrants
exercisable at $7.50 per share (the "7.50 Warrants") from McGrath, North, Mullin
& Kratz, P.C. The purchase price of the $7.50 Warrants was $100,000 cash. The
$7.50 Warrants expire May 1, 2005.
As a result of the purchase of the Shares and the Warrants, Fidelity
beneficially owns 45.7% of the Registrant, based on 6,440,414 shares outstanding
and including the Warrants pursuant to which Fidelity has the right to acquire
an additional 3,500,000 shares.
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ITEM 5. OTHER EVENTS.
As a condition to the Theisen-Fidelity agreement, the Board of Directors of
the Registrant adopted resolutions to redeem the Registrant's Stockholder Rights
Plan at a redemption price of $.001 per share of Common Stock to which the
rights are attached.
In connection with the agreement with Fidelity, Mr. Theisen resigned as
Chief Executive Officer and a Director of the Registrant, George J. Kubat
resigned as Chief Financial Officer and a Director, and Michael J. Scherr
resigned as a Director.
Filling the vacancies on the Registrant's Board of Directors are William
P. Foley, II, Frank P. Willey, and Andrew F. Puzder. Mr. Foley is the
Chairman and Chief Executive Officer of Fidelity and CKE Enterprises, Inc.
("CKE"), and is Chairman and a Director of Checker's Drive-In Restaurants,
Inc., and a Director of Rally's Hamburger's, Inc. Mr. Willey is President and
a Director of Fidelity and a Director of CKE. Mr. Puzder is Executive Vice
President/General Counsel of Fidelity and CKE.
On August 4, 1997, Mr. Foley was elected Chairman of the Board, Mr.
Puzder was elected Chief Executive Officer, Gary R. Nelson was elected Chief
Financial Officer, and M'Liss Kane was elected Secretary of the Registrant.
Mr. Nelson is Vice President and Ms. Kane is the Secretary, Senior Vice
President and Corporate Counsel of Fidelity.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
7.1 Stock and Warrant Purchase Agreement dated July 20, 1997 by and
between Fidelity National Financial, Inc., William M. Theisen, and GB Foods
Corporation.
7.2 Warrant Purchase Agreement dated July 20, 1997 by and between Fidelity
National Financial, Inc., McGrath, North, Mulin & Kratz, P.C., and GB Foods
Corporation.
7.3 Warrant Agreement and Warrant Certificate for 1,500,000 Warrants
exercisable at $5.00 per share dated July 21, 1997 by and between Fidelity
National Financial, Inc. and GB Foods Corporation.
7.4 Warrant Agreement and Warrant Certificate for 1,000,000 Warrants
exercisable at $7.00 per share dated July 21, 1997 by and between Fidelity
National Financial, Inc. and GB Foods Corporation.
7.5 Warrant Agreement and Warrant Certificate for 1,000,000 Warrants
exercisable at $7.50 per share dated July 21, 1997 by and between Fidelity
National Financial, Inc. and GB Foods Corporation.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GB FOODS CORPORATION
Date: August 4, 1997 By:
___________________________________
Bruce Haglund, SECRETARY
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STOCK AND WARRANT PURCHASE AGREEMENT
STOCK AND WARRANT PURCHASE AGREEMENT ("Agreement") by and between FIDELITY
NATIONAL FINANCIAL, INC. ("Purchaser"), WILLIAM M. THEISEN ("Seller") and GB
FOODS CORPORATION, a Delaware corporation (the "Company") dated this _____ day
of July, 1997.
RECITALS:
This Agreement is made with reference to the following facts and
circumstances:
(a) Purchaser desires to purchase shares and warrants to purchase shares
of the common stock, par value $.08 ("Common Stock") of the Company; and
(b) Seller desires to sell to Purchaser shares of Common Stock.
AGREEMENT:
In consideration of the foregoing Recitals which are incorporated with and
are made a part of this Agreement, and in further consideration of the mutual
covenants and agreements hereinafter contained, the parties hereto agree,
subject to the terms and conditions hereinafter set forth, as follows:
1. SALE AND PURCHASE. Subject to the terms and conditions contained
herein, at the Closing (as hereinafter defined), Seller shall sell, transfer,
assign, convey and deliver to Purchaser and Purchaser shall purchase free and
clear of all liens, claims and encumbrances good, complete and marketable title
to the following:
(i) 1,000,000 shares of Common Stock (the "Shares");
(ii) warrants to purchase 1,500,000 shares of Common Stock with an
exercise price of $5.00 per share evidenced by that certain
Warrant Certificate dated April 23, 1992, as amended, and all
rights in, to and under that certain Warrant Agreement dated
April 23, 1992 (the "$5.00 Warrants");
(iii) warrants to purchase 1,000,000 shares of Common Stock with an
exercise price of $7.00 per share evidenced by that certain
Warrant Certificate dated May 1, 1995 and all rights in, to and
under that certain Warrant Agreement dated May 1, 1995 (the $7.00
Warrants").
Seller represents and warrants that the Shares, $5.00 Warrants and
$7.00 Warrants (collectively the "Securities") sold pursuant to this Agreement
are duly authorized, validly issued and fully paid and non-assessable and that
Seller has good, complete and marketable title to the Securities, free and clear
of all liens, claims and encumbrances.
2. CONSIDERATION. The Purchaser shall pay to Seller, as consideration
for (i) the Shares, a cash amount of $5,000,000, (ii) the $5.00 Warrants, a cash
amount of $600,000 and (iii) the $7.00 Warrants, a cash amount of $100,000. The
foregoing payments (collectively the "Purchase Price") shall be made by
Purchaser in immediately available funds at the Closing against delivery of duly
endorsed Securities.
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3. CERTAIN MATTERS WITH RESPECT TO SELLER'S SECURITIES.
3.1 UNDERTAKING OF PURCHASER AND CERTIFICATE LEGENDS. The Purchaser
represents and undertakes that:
(i) The Securities are being acquired by the Purchaser for its
own account and are not for other persons and are not being
and will not be acquired with a view to the distribution
thereof, except to the extent permitted by the Securities
Act of 1933, as amended, (the "1933 Act") and the rules and
regulations thereunder.
(ii) None of the Securities will be transferred by or through
the Purchaser in violation of the 1933 Act, any state
securities laws, the securities laws of any other country
or province or the terms of this Agreement.
(iii) The Purchaser understands that the Securities have not been
registered under the 1933 Act and, therefore, cannot be
resold or otherwise transferred in the United States unless
such shares are registered under the 1933 Act, or unless an
exemption from registration is available.
(iv) The certificates representing the Securities to be
delivered to the Purchaser pursuant to this Agreement will
bear a restrictive legend in substantially the following
form and an appropriate stop transfer order may, and will,
be placed against the transfer of the share certificates
and no transfer of the shares will be valid unless made in
accordance with this Agreement:
"The securities represented by this certificate have been
issued or transferred to the registered holder as a result
of a transaction to which the exemption provided by
Section 4(2) under the Securities Act of 1933, as amended
(the "1933 Act") applied. The securities represented by this
certificate have not been registered under the 1933 Act and
may not be sold, transferred or assigned, and the issuer is
not required to give effect to any attempted sale, transfer
or assignment, except (i) pursuant to a current registration
statement under the 1933 Act; (ii) in a transaction
permitted by Rule 144 under the 1933 Act and as to which the
issuer has received reasonably satisfactory evidence of
compliance with the provisions of Rule 144; or (iii) upon
receipt of a legal opinion acceptable to the issuer to the
effect that the transaction does not require registration
under the 1933 Act.
3.2 REPRESENTATIONS OF THE PURCHASER. The Purchaser represents and
warrants that:
(i) It is familiar with Section 4(2) of the 1933 Act and with
Regulation D issued by the Securities and Exchange
Commission ("SEC") pursuant to the 1933 Act.
(ii) It has been furnished before the execution of this
Agreement by the Company with (i) the Company's annual
report to stockholders for fiscal year ended December 31,
1996; (ii) the definitive proxy statement filed in
connection with the Company's annual stockholders' meeting
held on May 5, 1997; (iii) Form 10-K for fiscal year ended
December 30, 1996; and (iv) the Company's Form 10-Q for the
quarter ended March 31, 1997. The Purchaser has made such
further
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investigation of the Company as was deemed appropriate
and has been given the opportunity to ask questions of and
receive answers from the Company or any person acting on
its behalf concerning the terms and condition of the
transactions contemplated herein and has obtained such
additional information deemed necessary to verify the
accuracy of the information that was obtained by the
Purchaser.
(iii) The Purchaser has access to, and has reviewed and
understood, all material information, including financial
statements, concerning the Company which it deems necessary
or advisable in order to evaluate the risks and merits of
entering into this transaction and acquiring the
Securities.
(iv) The Purchaser has such knowledge and experience in
financial and business matters that it is capable of
evaluating the merits and risks of acquiring the
Securities.
(v) The Purchaser is an "accredited investor" as that term is
defined in SEC Rule 501(a)(5) because it is a corporation
with total assets in excess of $5,000,000.
(vi) Purchaser acknowledges that the Securities are being
acquired without any representations or warranties of
Seller except as set forth in Section 1, above, and
Sections 5 and 7 below.
4. CLOSING. Subject to the terms and conditions contained herein, the
transfer of the Securities by Seller to the Purchaser ("Closing") will take
place on the date hereof at the offices of Seller, or such other date and place
as the parties may mutually agree ("Closing Date").
4.1 SELLER'S OBLIGATION. At Closing, Seller shall deliver the
Securities.
4.2 PURCHASER'S OBLIGATION AT CLOSING. At Closing, Purchaser shall pay
the Purchase Price in immediately available funds to Seller.
4.3 COMPANY OBLIGATIONS. At Closing, Company shall issue replacement
Warrant Agreements and Warrant Certificates to Purchaser for the $5.00 Warrants
and $7.00 Warrants transferred by Seller to Purchaser pursuant to this Agreement
and to Seller for the $5.00 Warrants he will own following the Closing as
described in Section 5(ii) below, all such replacement Warrant Agreements and
Warrant Certificates to preserve for the holders all rights, to and under, in
the case of the $5.00 Warrants, the Warrant Certificate dated April 23, 1992, as
amended, and the related Warrant Agreement dated April 23, 1992, and in the case
of the $7.00 Warrants, the Warrant Certificate dated May 1, 1995 and the related
Warrant Agreement dated May 1, 1995.
5. SECURITIES OWNERSHIP AND STANDSTILL AND RIGHT OF FIRST REFUSAL.
Seller represents and warrants that:
(i) He beneficially owns 1,269,826 shares of Common Stock, $5.00
Warrants to purchase 2,000,000 shares of Common Stock at an
exercise price of $5.00 per share and $7.00 Warrants to purchase
1,000,000 shares of Common Stock at $7.00 per share;
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(ii) Following the Closing, he will beneficially own 269,826 shares of
Common Stock and $5.00 Warrants to purchase 500,000 shares of
Common Stock (such remaining securities, including the Common
Stock issuable upon exercise of the $5.00 Warrants, referred to
herein as "Theisen Securities").
(iii) To the knowledge of the Seller, no material adverse fact with
respect to the Company, including any litigation or threat of
pending litigation, has arisen since March 31, 1997, the last
date of the period covered by the Company's last quarterly report
filed under the Securities Exchange Act of 1934, which would make
the information provided by the Company to the Purchaser
misleading.
Seller agrees that he will not for a period of two years following
the Closing, directly or indirectly, without the prior written consent of the
Company, acquire or agree, offer, seek or propose to acquire, or cause to be
acquired, ownership (including beneficial ownership as defined in Rule 13d-3
under the Exchange Act of 1934) of any of the Company's assets or businesses or
securities issued by the Company or any rights or options to acquire such
ownership, PROVIDING, HOWEVER the foregoing shall not restrict or prohibit
Seller, with respect solely to the Theisen Securities, from exercising his right
to purchase Common Stock or to sell Common Stock.
If at any time during the two years following the Closing, Seller
desires to sell any of the Theisen Securities, Seller shall notify Purchaser of
the price, terms and conditions on which the Theisen Securities are to be sold,
and Purchaser shall have the right and option, exercisable only within the first
four (4) business hours after receipt of Seller's notice, to purchase such
securities on the same price, terms and conditions offered by the third party.
Seller's notice and Purchaser's acceptance shall be deemed received if
transmitted by facsimile to the receiving party in the same manner as provided
in this Agreement for notices. If Purchaser timely notifies Seller of its
acceptance, then Purchaser shall consummate the purchase of the offered Theisen
Securities by the close of the next business day, or the date stated in Seller's
notice, whichever is later. If Seller does not consummate the sale to the third
party on the same (or no less favorable to Seller) price, terms and conditions
within one (1) month following Purchaser's non-exercise of its right and option
hereunder, then Purchaser's right and option shall reapply to such securities.
6. MUTUAL RELEASES. Except for claims or obligations under this
Agreement, Purchaser, the Company and their respective affiliates, jointly and
severally forever discharge and release Seller, his employees and attorneys
(except as may be otherwise provided in an agreement of even date herewith with
McGrath, North, Mullin & Kratz, P.C.) from any and all rights, claims, demands,
damages, debts, liabilities, accounts, reckonings, liens, attorneys fees, costs,
expenses, actions and causes of every kind and nature whatsoever, whether in
contract, tort, at law or in equity, or otherwise, suspected or unsuspected,
whether currently existing or which may hereafter arise, which Purchaser,
Company or their respective affiliates owns or holds or at anytime heretofore
has ever had, owned or held, or may hold in the future, related to or arising
out of or in any way connected to the Company or the Securities.
Notwithstanding the foregoing, to the extent Company has a claim against Seller
which would otherwise be covered by insurance carried by Company but for this
release, then the claim shall not be deemed to be released to the extent of such
insurance coverage provided the payment of the claim by the insurance company or
anyone on its behalf does not result in Seller being liable to the party or
company paying the claim by reason of rights of subrogation, contribution,
indemnity or any other reason.
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Except as provided in Section 8 below and for claims or obligations
under this Agreement, Seller forever discharges and releases Purchaser, the
Company and their respective affiliates, and attorneys, from any and all rights,
claims, demands, damages, debts, liabilities, accounts, reckonings, liens,
attorneys fees, costs, expenses, actions and causes of action of every kind and
nature whatsoever, whether in contract, tort, at law or in equity, or otherwise,
suspected or unsuspected, whether currently existing or which may hereafter
arise, which Seller owns or holds, or may hold in the future, or at any time
heretofore has ever had, owned or held, related to or arising out of or in any
way connected to the Company or the Securities, including Company's obligations
under Stock Purchase Agreement dated October 29, 1992 with Seller and others.
It is the intention of the parties hereto that the foregoing releases
shall be effective as a bar to all demands, liens, assignments, contracts,
covenants, actions, suits, causes of action, obligations, costs, expenses,
attorneys fees, damages, losses, claims, controversies, judgments, orders and
liabilities of whatsoever character, nature and kind, known or unknown,
suspected or unsuspected and whether or not concealed or hidden, here and above
specified to be so barred; in furtherance of this intention, the parties hereto
expressly, knowingly, and voluntarily waive any and all rights and benefits
conferred upon them by the provisions of Section 1542 of the California Civil
Code, which are as follows:
"A general release does not extend to claims which the creditor does
not know or suspect exist in his favor at the time of executing the
release, which if known by him must have materially affected the
settlement with the debtor."
The parties hereto expressly consent that this release shall be given
full force and effect in accordance with each and all of its express terms and
provisions, relating to unknown and unsuspected claims, demands, causes of
actions, if any, to the same effect as those terms and provisions relating to
any other claims, demands, and causes of action here and above specified.
7. RIGHTS REDEMPTION AND BOARD OF DIRECTORS. The Company represents and
warrants that its board of directors has approved the acquisition of the
Securities and other transactions contemplated in this Agreement, and approved
the issuance of the warrants and issuance of the Common Stock thereunder upon
exercise and has redeemed certain share purchase rights issued pursuant to the
Company's Stockholder Rights Agreement dated as of July 9, 1996 between the
Company and the American Securities Transfer Incorporated, as Rights Agent, and
no other agreement is contravened by the transactions herein. At Closing, the
Company will deliver the resignations of Michael Scherr and George Kubat and the
appointments, as approved by the Company's board of directors, of William Foley
II, Frank P. Willey and Andrew F. Puzder as directors of the Company, all
effective as of the Closing.
8. RESIGNATION. At Closing, Seller will resign as Chairman, Director
and Chief Executive Officer of the Company, and as an inducement for Seller to
so resign, the parties agree as follows:
8.1 Company will pay a fee to Robert Martyn or Pauli & Company
Incorporated in the amount of $30,000 cash on or before July 30, 1997.
8.2 Company will pay Seller at Closing any unpaid salary actually accrued
on the Company's books, which amount shall not exceed $50,000.
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8.3 The Company shall cause all rights to indemnification (including
rights relating to the payment or advancement of expenses) now existing in favor
of Seller and any current or former director or officer of the Company,
including for purposes of this subsection any subsidiary or any predecessor of
the Company, or any controlling person of any of the foregoing (the "Indemnified
Parties"), as now provided in their respective Certificates of Incorporation or
Bylaws, shall survive this agreement and shall continue in full force and effect
for a period of not less than five (5) years after the date of this Agreement
(provided, however, that in the event any claim or claims are asserted or made
within such five year period, all rights to indemnification in respect of any
such claim or claims shall continue until final disposition of any and all such
claims). Purchaser agrees that Purchaser shall cause Purchaser's nominees or
designees who become directors of the Company to vote, and shall vote or cause
to be voted all voting shares of stock of Company in favor of the
indemnification of and advancement of expenses to the Indemnified Parties to the
full extent permitted by applicable law and such certificates of incorporation
or bylaws. The obligations under this subparagraph include the Company using
best efforts to provide continuous, uninterrupted officers' and directors'
liability insurance covering the officers and directors of the Company,
including the Indemnified Parties, with respect to their actions or omissions to
act occurring prior to the date of their resignation, on terms and coverage no
less favorable than are provided under such insurance currently in effect and
carried by the Company on the date hereof provided, however, that in no event
shall the Company be required to pay aggregate annual premiums for such coverage
in excess of one hundred fifty percent (150%) of the current premiums for the
same. If Company changes insurance carriers or policies, the Company shall also
use best efforts to maintain "tail" liability coverage for the duration of the
aforesaid five year period with respect to any "claims made" directors' and
officers' liability insurance policies in effect prior to expiration of said
five year period.
9. MISCELLANEOUS. The following miscellaneous provisions shall apply to
this Agreement:
9.1 NOTICES. All notices or other communications required or permitted
to be given, pursuant to this Agreement, shall be in writing and shall be deemed
duly given when received if delivered in person or by facsimile transmission,
telex, telegram or cable and confirmed by mail, or mailed by registered or
certified mail (return receipt requested) or express mail, postage prepaid, as
follows:
If to Purchaser: Fidelity National Financial, Inc.
17911 Von Karman Avenue
Suite 300
Irvine, CA 92714
Facsimile No. (714) 622-4116
Attention: Andrew F. Puzder
with a copy to: Stradling, Yocca, Carlson & Rauth
660 Newport Center Drive
Suite 1600
Newport Beach, CA 92660
Facsimile No. (714) 725-4100
Attention: C. Craig Carlson
If to Seller: William M. Theisen
Business Ventures
Suite 12
210 Regency Parkway
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Facsimile No. (402) 391-8773
Omaha, NE 68114
with a copy to: Lee Hamann
McGrath, North, Mullin & Kratz, P.C.
Suite 1400 One Central Park Plaza
222 South Fifteenth Street
Omaha, NE 68102
Facsimile No. (402) 341-0216
If to Company: GB Foods Corporation
1100 Newport Center Drive
Newport Beach, California 92660
Facsimile No. (714) 640-5903
with a copy to: Bruce Haglund
Gibson, Haglund & Johnson
2010 Main Street, Suite 400
Irvine, CA 92714
Facsimile No. (714) 752-1144
or at such other address as the party to whom notice is to be
given furnishes in writing to the other party in a manner set
forth above.
9.2 AMENDMENTS AND WAIVERS. This Agreement may not be modified or
amended, except by instruments or instruments in writing, signed by the party
against whom enforcement of such modification or amendment is sought. A party
by an instrument in writing, may waive compliance by the other party with any
terms or provision of this Agreement on the part of such other party to be
performed or complied with. No action taken, pursuant to this Agreement,
including any investigation by or on behalf of any party, shall be deemed to
constitute a waiver by the party taking such action of compliance with any
representation, warranty or agreement contained herein. The waiver by any party
hereto of a breach of any term or provision of this Agreement shall not be
construed as a waiver of any subsequent breach.
9.3 EXPENSES. Whether or not this Agreement shall be consummated, each
party shall pay their own expenses incident to the preparation, execution and
consummation of this Agreement. Purchaser and Seller acknowledge that, other
than Robert Martin of Pauli & Company, Incorporated ("Pauli"), no broker or
finder is entitled to any brokerage or finders fees or other commission in
connection with the proposed purchase and sale of the Securities. In the event
the purchase and sale of the Securities is consummated as contemplated herein,
other than the $30,000 to be paid to Pauli pursuant to Section 8.2 above, the
balance of any fee owed to Pauli in connection with this transaction will be
paid by Purchaser.
9.4 ENTIRE AGREEMENT. Except for the letter agreement between Seller and
Company dated July 16, 1997, this Agreement constitutes the entire agreement
among the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral and written, among the
parties hereto with respect to the subject matter hereof.
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9.5 APPLICABLE LAW. This Agreement and the legal relations among the
parties hereto shall be governed by and construed in accordance with the laws of
the State of Delaware applicable to contracts made and performed in Delaware.
9.6 BINDING EFFECT, BENEFITS. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective successors and
assigns; nothing in this Agreement, express or implied, is intended to confer on
any person other than the parties hereto or their respective successors and
assigns, any rights, remedies, obligations or liability under or by reason of
this Agreement.
9.7 ASSIGNABILITY. Neither this Agreement nor any of the parties' rights
hereunder shall be assignable by any party hereto without the prior written
consent of the other party hereto.
9.8 EFFECT OF HEADINGS. The headings of the various sections and
subsections herein are inserted merely as a matter of convenience and for
reference and shall not be construed as in any manner defining, limiting or
describing the scope or intent to particular sections to which they refer, or as
affecting the meaning or construction of the language in the body of such
sections.
9.9 SEVERABILITY. Any term or provision of this Agreement, which is
invalid or unenforceable in any jurisdiction, shall be ineffective to the extent
of such invalidity or unenforceability without rendering invalid or
unenforceable the remaining terms and provisions of this Agreement or affecting
the validity or enforceability of any of the terms or other provisions of this
Agreement in any other jurisdiction.
9.10 CONSTRUCTION. The language of all parts of this Agreement shall in
all cases be construed as a whole according to its fair meaning, strictly
neither for nor against any party hereto, and without implying a presumption
that the terms thereof shall be more strictly construed against one party by
reason of the rule of construction that a document is to be construed more
strictly against the person who himself drafted same. It is hereby agreed that
the representatives of both parties have participated in the preparation hereof.
9.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts and by facsimile transmitted signatures, each of which shall be
regarded as an original and all of which shall constitute one and the same
instrument.
9.12 TIME OF THE ESSENCE. Time is of the essence of this Agreement. To
the extent the actions called for under this Agreement have not occurred as of
Closing, the parties shall cause them to occur as soon as practicable on
July 21, 1997.
9.13 FURTHER ASSURANCES. At any time and from time to time after Closing,
at any party's request and without further consideration, the other parties
hereto shall execute and deliver such other instruments of sale, transfer,
assignment or confirmation, and take such other actions as the requesting party
may reasonably deem necessary or desirable, in order to more effectively carry
out and implement the provisions and purposes of this Agreement.
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IN WITNESS WHEREOF, Purchaser and Seller have executed this Agreement on
the date first above written.
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WILLIAM M. THEISEN FIDELITY NATIONAL FINANCIAL, INC.
By:
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Its:
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GB FOODS CORPORATION
By:
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Its:
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WARRANT PURCHASE AGREEMENT
WARRANT PURCHASE AGREEMENT ("Agreement") by and between FIDELITY NATIONAL
FINANCIAL, INC. ("Purchaser"), MCGRATH, NORTH, MULLIN & KRATZ, P.C. ("Seller"),
and GB FOODS CORPORATION, a Delaware corporation (the "Company") dated this
_____ day of July, 1997.
RECITALS:
This Agreement is made with reference to the following facts and
circumstances:
(a) Purchaser desires to purchase warrants exercisable for the purchase
of common stock, par value $.08 ("Common Stock") of the Company; and
(b) Seller desires to sell such warrants to the Purchaser.
AGREEMENT:
In consideration of the foregoing Recitals which are incorporated with and
are made a part of this Agreement, and in further consideration of the mutual
covenants and agreements hereinafter contained, the parties hereto agree,
subject to the terms and conditions hereinafter set forth, as follows:
1. SALE AND PURCHASE. Subject to the terms and conditions contained
herein, at the Closing (as hereinafter defined), Purchaser shall sell, transfer,
assign, convey and deliver to Purchaser and Purchaser shall purchase free and
clear of all liens, claims and encumbrances a warrant or warrants to purchase
1,000,000 shares of Common Stock with an exercise price of $7.50 per share
evidenced by that certain warrant certificate dated May 1, 1995, and all rights
in, to and under that certain Warrant Agreement dated May 1, 1995 (the
"Securities"). Seller warrants to Purchaser that Seller has good, complete and
marketable title to the Securities, subject to the Company's Board of Directors
consent to transfer contained in Section 7.
2. CONSIDERATION. The Purchaser shall pay to Seller, as consideration
for the Securities, a cash amount of $100,000 (the "Purchase Price") in
immediately available funds at the Closing.
3. CERTAIN MATTERS WITH RESPECT TO SELLER'S SECURITIES.
3.1 UNDERTAKING OF PURCHASER AND CERTIFICATE LEGENDS. The Purchaser
represents and undertakes that:
(i) The Securities that are being acquired by the Purchaser are
not for other persons and are not being and will not be
acquired with a view to the distribution thereof, except to
the extent permitted by the Securities Act of 1933, as
amended, (the "1933 Act") and the rules and regulations
thereunder.
(ii) None of the Securities will be transferred by or through
the Purchaser in violation of the 1933 Act, any state
securities laws, the securities laws of any other country
or province or the terms of this Agreement.
(iii) The Purchaser understands that the Securities have not been
registered under the 1933 Act and, therefore, cannot be
resold or otherwise transferred in the United
<PAGE>
States unless such shares are registered under the 1933 Act,
or unless an exemption from registration is available.
(iv) The certificates representing the Common Stock issuable
upon exercise of the Securities will bear a restrictive
legend in substantially the following form and an
appropriate stop transfer order may, and will, be placed
against the transfer of the share certificates and no
transfer of the shares will be valid unless made in
accordance with this Agreement:
"The securities represented by this certificate have been
issued or transferred to the registered holder as a result
of a transaction to which the exemption provided by
Section 4(2) under the Securities Act of 1933, as amended
(the "1933 Act") applied. The securities represented by this
certificate have not been registered under the 1933 Act and
may not be sold, transferred or assigned, and the issuer is
not required to give effect to any attempted sale, transfer
or assignment, except (i) pursuant to a current registration
statement under the 1933 Act; (ii) in a transaction
permitted by Rule 144 under the 1933 Act and as to which the
issuer has received reasonably satisfactory evidence of
compliance with the provisions of Rule 144; or (iii) upon
receipt of a legal opinion acceptable to the issuer to the
effect that the transaction does not require registration
under the 1933 Act."
3.2 REPRESENTATIONS OF THE PURCHASER. The Purchaser represents and
warrants that:
(i) It is familiar with Section 4(2) of the 1933 Act and with
Regulation D issued by the Securities and Exchange
Commission ("SEC") pursuant to the 1933 Act.
(ii) It has been furnished before the execution of this
Agreement by the Company with (i) the Company's annual
report to stockholders for fiscal year ended December 31,
1996; (ii) the definitive proxy statement filed in
connection with the Company's annual stockholders' meeting
held on May 5, 1997; (iii) Form 10-K for fiscal year ended
December 30, 1996; and (iv) the Company's Form 10-Q for the
quarter ended March 31, 1997. The Purchaser has made such
further investigation of the Company as was deemed
appropriate and has been given the opportunity to ask
questions of and receive answers from the Company or any
person acting on its behalf concerning the terms and
condition of the transactions contemplated herein and has
obtained such additional information deemed necessary to
verify the accuracy of the information that was obtained by
the Purchaser.
(iii) The Purchaser has access to, and has reviewed and
understood, all material information, including financial
statements, concerning the Company which it deems necessary
or advisable in order to evaluate the risks and merits of
entering into this transaction and acquiring the
Securities.
(iv) The Purchaser has such knowledge and experience in
financial and business matters that it is capable of
evaluating the merits and risks of acquiring the
Securities.
-2-
<PAGE>
(v) The Purchaser is an "accredited investor" as that term is
defined in SEC Rule 501(a)(5) because it is a corporation
with total assets in excess of $5,000,000.
(vi) The Purchaser acknowledges that the Securities are being
acquired without any representations and warranties by
Seller, except as provided in Section 1, above.
4. CLOSING. Subject to the terms and conditions contained herein, and
subject to consummation of the transactions called for under the Stock and
Warrant Purchase Agreement among Company, Purchaser and William M. Theisen of
even date herewith, the transfer of the Securities by Seller to the Purchaser
("Closing") will take place on the date hereof at the offices of Seller, or such
other date and place as the parties may mutually agree ("Closing Date").
4.1 SELLER'S OBLIGATION. At Closing, Seller shall deliver the
Securities.
4.2 PURCHASER'S OBLIGATION. At Closing, Purchaser shall deliver the
Purchase Price to Seller in immediately available funds.
4.3 COMPANY'S OBLIGATION. At Closing, Company shall issue a replacement
Warrant Agreement and Warrant Certificate to Purchaser for the $7.50 Warrants
transferred to Purchaser by Seller pursuant to this Agreement, such replacement
Warrant Agreement and Warrant Certificate to preserve for Purchaser all rights
to, and under the Warrant Certificate dated May 1, 1995 and the Warrant
Agreement dated May 1, 1995.
5. TERMINATION OF SELLER'S SERVICES. Although Seller is not the
Company's general counsel, Seller has been retained by the Company from time to
time to represent it in various legal matters including, but not limited to,
certain franchisee and litigation matters and for which the Company currently
owes Seller outstanding legal fees and reimbursable expenses in the amount of
$28,869.43, a portion of which are estimated. Seller's legal representation of
the Company on any pending matters is hereby terminated effective immediately,
and Company shall remit to Seller as soon as practicable on Monday, July 21,
1997, the outstanding balance of said legal fees and reimbursable expenses in
immediately available funds as payment in full for all legal services rendered
by Seller to the Company up to and including this date.
6. MUTUAL RELEASES. Except for claims or obligations under this
Agreement, Purchaser, the Company and their respective affiliates, jointly and
severally, forever discharge and release Seller, its current and former
employees, officers, directors and attorneys from any and all rights, claims,
demands, damages, debts, liabilities, accounts, reckonings, liens, attorneys
fees, costs, expenses, actions and causes of every kind and nature whatsoever,
whether in contract, tort, at law or in equity, or otherwise, suspected or
unsuspected, whether currently existing or which may hereafter arise which
Purchaser, the Company or their respective affiliates owns or holds or at
anytime heretofore has ever had, owned or held, or may hold in the future,
related to or arising out of or in any way connected to the Company or the
Securities.
Except for claims or obligations under this Agreement, Seller forever
discharges and releases Purchaser and the Company, and their respective
affiliates, and attorneys, from any and all rights, claims, demands, damages,
debts, liabilities, accounts, reckonings, liens, attorneys fees, costs,
expenses, actions and causes of action of every kind and nature whatsoever,
whether in contract, tort, at law or in equity, or otherwise, suspected or
unsuspected, whether currently existing or which may hereafter arise which
Seller owns or holds, or at any time heretofore has ever had, owned or held, or
may hold in the
-3-
<PAGE>
future, related to or arising out of or in any way connected to the Company
or the Securities, including, without limitation, for any services for which
the Securities were initially issued.
It is the intention of the parties hereto that the foregoing release
shall be effective as a bar to all demands, liens, assignments, contracts,
covenants, actions, suits, causes of action, obligations, costs, expenses,
attorneys fees, damages, losses, claims, controversies, judgments, orders and
liabilities of whatsoever character, nature and kind, known or unknown,
suspected or unsuspected and whether or not concealed or hidden, here and above
specified to be so barred; in furtherance of this intention, the parties hereto
expressly, knowingly, and voluntarily waive any and all rights and benefits
conferred upon them by the provisions of Section 1542 of the California Civil
Code, which are as follows:
"A general release does not extend to claims which the creditor does
not know or suspect exist in his favor at the time of executing the
release, which if known by him must have materially affected the
settlement with the debtor."
The parties hereto expressly consent that this release shall be given
full force and effect in accordance with each and all of its express terms and
provisions, relating to unknown and unsuspected claims, demands, causes of
actions, if any, to the same effect as those terms and provisions relating to
any other claims, demands, and causes of action here and above specified.
7. RIGHTS REDEMPTION AND APPROVAL. The Company represents and warrants
that its board of directors has redeemed certain share purchase rights issued
pursuant to the Company's Stockholder Rights Agreement dated as of July 9, 1996
between the Company and the American Securities Transfer Incorporated, as Rights
Agent and has approved of and consented to the transfer of the Securities to the
Purchaser by the Seller.
8. MISCELLANEOUS. The following miscellaneous provisions shall apply to
this Agreement:
8.1 NOTICES. All notices or other communications required or permitted
to be given, pursuant to this Agreement, shall be in writing and shall be deemed
duly given when received if delivered in person or by facsimile transmission,
telex, telegram or cable and confirmed by mail, or mailed by registered or
certified mail (return receipt requested) or express mail, postage prepaid, as
follows:
If to Purchaser: Fidelity National Financial, Inc.
17911 Von Karman Avenue
Suite 300
Irvine, CA 92714
Facsimile No. (714) 622-4116
Attention: Andrew F. Puzder
with a copy to: Stradling, Yocca, Carlson & Rauth
660 Newport Center Drive
Suite 1600
Newport Beach, CA 92660
Facsimile No. (714) 725-4100
Attention: C. Craig Carlson
-4-
<PAGE>
If to Seller: Lee Hamann
McGrath, North, Mullin & Kratz, P.C.
Suite 1400 One Central Park Plaza
222 South Fifteenth Street
Omaha, NE 68102
Facsimile No. (402) 341-0216
If to Company: GB Foods Corporation
1100 Newport Center Drive
Newport Beach, California 92660
Facsimile No. (714) 640-5903
Attention:
-------------------------
with a copy to: Bruce Haglund
Gibson, Haglund & Johnson
2010 Main Street, Suite 400
Irvine, CA 92714
Facsimile No. (714) 752-1144
or at such other address as the party to whom notice is to be
given furnishes in writing to the other party in a manner set
forth above.
8.2 AMENDMENTS AND WAIVERS. This Agreement may not be modified or
amended, except by instruments or instruments in writing, signed by the party
against whom enforcement of such modification or amendment is sought. A party
by an instrument in writing, may waive compliance by the other party with any
terms or provision of this Agreement on the part of such other party to be
performed or complied with. No action taken, pursuant to this Agreement,
including any investigation by or on behalf of any party, shall be deemed to
constitute a waiver by the party taking such action of compliance with any
representation, warranty or agreement contained herein. The waiver by any party
hereto of a breach of any term or provision of this Agreement shall not be
construed as a waiver of any subsequent breach.
8.3 EXPENSES. Whether or not this Agreement shall be consummated, each
party shall pay their own expenses incident to the preparation, execution and
consummation of this Agreement. Purchaser and Seller acknowledge that, other
than Robert Martin of Pauli & Company, Incorporated ("Pauli"), no broker or
finder is entitled to any brokerage or finders fees or other commission in
connection with the proposed purchase and sale of the Securities. In the event
the purchase and sale of the Securities is consummated as contemplated herein,
Purchaser and the Company agree that the Company will pay $30,000 to Pauli at
the Closing and the balance of any fee owed to Pauli in connection with this
transaction will be paid by Purchaser.
8.4 ENTIRE AGREEMENT. Except for the letter agreement between Seller and
the Company dated July 16, 1997, this Agreement constitutes the entire agreement
among the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral and written, among the
parties hereto with respect to the subject matter hereof.
8.5 APPLICABLE LAW. This Agreement and the legal relations among the
parties hereto shall be governed by and construed in accordance with the laws of
the State of Nebraska applicable to contracts made and performed in Nebraska.
-5-
<PAGE>
8.6 BINDING EFFECT, BENEFITS. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective successors and
assigns; nothing in this Agreement, express or implied, is intended to confer on
any person other than the parties hereto or their respective successors and
assigns, any rights, remedies, obligations or liability under or by reason of
this Agreement.
8.7 ASSIGNABILITY. Neither this Agreement nor any of the parties' rights
hereunder shall be assignable by any party hereto without the prior written
consent of the other party hereto.
8.8 EFFECT OF HEADINGS. The headings of the various sections and
subsections herein are inserted merely as a matter of convenience and for
reference and shall not be construed as in any manner defining, limiting or
describing the scope or intent to particular sections to which they refer, or as
affecting the meaning or construction of the language in the body of such
sections.
8.9 SEVERABILITY. Any term or provision of this Agreement, which is
invalid or unenforceable in any jurisdiction, shall be ineffective to the extent
of such invalidity or unenforceability without rendering invalid or
unenforceable the remaining terms and provisions of this Agreement or affecting
the validity or enforceability of any of the terms or other provisions of this
Agreement in any other jurisdiction.
8.10 CONSTRUCTION. The language of all parts of this Agreement shall in
all cases be construed as a whole according to its fair meaning, strictly
neither for nor against any party hereto, and without implying a presumption
that the terms thereof shall be more strictly construed against one party by
reason of the rule of construction that a document is to be construed more
strictly against the person who himself drafted same. It is hereby agreed that
the representatives of both parties have participated in the preparation hereof.
8.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts and by facsimile transmitted signatures, each of which shall be
regarded as an original and all of which shall constitute one and the same
instrument.
8.12 TIME OF THE ESSENCE. Time is of the essence of this Agreement. To
the extent the actions called for under this Agreement have not occurred as of
Closing, the parties shall cause them to occur as soon as practicable on
July 21, 1997.
8.13 FURTHER ASSURANCES. At any time and from time to time after Closing,
at any party's request and without further consideration, the other parties
hereto shall execute and deliver such other instruments of sale, transfer,
assignment or confirmation, and take such other actions as the requesting party
may reasonably deem necessary or desirable, in order to more effectively carry
out and implement the provisions and purposes of this Agreement.
-6-
<PAGE>
IN WITNESS WHEREOF, Purchaser and Seller have executed this Agreement on
the date first above written.
MCGRATH, NORTH, MULLIN & FIDELITY NATIONAL FINANCIAL, INC.
KRATZ, P.C.
By: By:
----------------------- -----------------------
Its: Its:
----------------------- -----------------------
GB FOODS CORPORATION
By:
-----------------------
Its:
-----------------------
<PAGE>
GB FOODS CORPORATION
WARRANT AGREEMENT
THIS WARRANT AGREEMENT dated as of July 21, 1997, is entered into by and
among GB FOODS CORPORATION, a Delaware corporation, (the "Company"), and
FIDELITY NATIONAL FINANCIAL, INC., a Delaware corporation (the "Holder").
The Company proposes to issue to the Holder warrants as hereinafter
described (the "Warrants") to purchase up to an aggregate of ONE MILLION FIVE
HUNDRED THOUSAND (1,500,000) shares, subject to adjustment as provided in
Section 8 hereof (such 1,500,000 shares, as adjusted, being hereinafter
referred to as the "Shares") of the Company's Common Stock, par value $0.08
(the "Common Stock"), each Warrant entitling the holder ("Holder") thereof to
purchase one share of Common Stock.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth and for other good and valuable consideration,
the parties hereto agree as follows:
1. TRANSFER OF WARRANTS: FORM OF WARRANT. On the date hereof, in connection
with the sale and assignment of the Warrants to the Holder pursuant to terms
of that certain Stock and Warrant Purchase Agreement dated July 20, 1997 by
and among William M. Theisen, the Company, and the Holder, the Holder hereby
issues and delivers the Warrants to the Holder. The form of the Warrant and
of the form of election to purchase Shares to be attached thereto shall be
substantially as set forth on the attachments hereto entitled "Warrant
Certificate." The Warrants shall be executed on behalf of the Company by the
manual or facsimile signature of the then present Chairman or Co-Chairman,
President or any Vice President of the Company, under its corporate seal,
affixed or in facsimile, and attested by the manual or facsimile signature of
the present or any future Secretary or Assistant Secretary of the Company.
2. REGISTRATION. The Warrants shall be numbered and shall be registered in
a Warrant register (the "Warrant Register"). Subject to the provisions of
Section 3, the Company shall be entitled to treat the registered holder of
any Warrant on the Warrant Register as the owner in fact thereof for all
purposes and shall not be bound to recognize any equitable or other claim to
or interest in such Warrant on the part of any other person, and shall not be
liable for any registration of transfer of Warrants which are registered or
are to be registered in the name of a fiduciary or the nominee of a fiduciary
unless made with the actual knowledge that a fiduciary or nominee is
committing a breach of trust in requesting such registration of transfer, or
with such knowledge of such facts that its participation therein amounts to
bad faith. The Warrants shall be registered initially in the name of the
Holder.
3. WARRANTS TRANSFERABILITY LIMITED. The Warrants are expressly hereby made
non-transferable and shall not be sold, transferred, assigned or
hypothecated, in part or in whole, except upon the liquidation and
dissolution of the Holder or the prior written consent of the Company. Any
permitted transfer will be allowed only upon delivery of the Warrant
Certificate duly endorsed by the Holder or by his duly authorized attorney or
representative, or accompanied by proper evidence of succession, assignment
or authority to transfer and contingent upon approval by the Board of
Directors of the Company. Such permitted transfer, of the Warrants shall be
effective as of the date of such endorsement or other proper evidence. In
all cases of transfer by an attorney, the original power of attorney, duly
approved, or an official copy thereof, duly certified, shall be deposited
with the Company. Such permitted transfer of the Warrants shall be effective
as of the date of such endorsement or other proper evidence. In all cases of
transfer by an attorney, the original power of attorney, duly approved, or an
official copy thereof, duly certified, shall be deposited with the Company.
In case of transfer by executors, administrators, guardians or other legal
representatives, duly authenticated evidence of their authority shall be
produced, and may be required to be deposited
Page 1 of Eight
<PAGE>
with the Company in its discretion. Upon any registration of transfer, the
Company shall deliver a new Warrant or Warrants to the person entitled
thereto. The Warrants may be exchanged at the option of the Holder thereof
for other Warrants of different denominations, of like tenor and representing
in the aggregate the right to purchase a like number of shares of Common
Stock upon surrender to the Company or its duly authorized agent. The
Company may require payment of the sum sufficient to cover all applicable
taxes and other governmental charges that may be imposed in connection with
any voluntary transfer, exchange or other disposition of the Warrants.
Notwithstanding the foregoing, the Company shall have no obligation to cause
Warrants to be transferred on its books to any person, if such transfer would
violate the registration provisions of Securities Act of 1933, as amended
(the "Act"), unless an exemption under the Act is available therefor.
4. TERM OF WARRANTS; EXERCISE OF WARRANTS.
(a) Subject to Paragraph 4(d) below, each Warrant entitles the registered
owner thereof to purchase one Share at a purchase price of Five Dollars
($5.00) per Share (as adjusted from time to time pursuant to the provisions
hereof, the "Exercise Price") at any time or from time to time the date of
this Agreement until 5:00 p.m., California time, November 23, 2002 (the
"Warrant Expiration Date"). The Exercise Price and the Shares issuable
upon exercise of Warrants are subject to adjustment upon the occurrence of
certain events, pursuant to the provisions of Section 8 of this Agreement.
Subject to the provisions of the Agreement, the Holder or a permitted
Holder shall have the right, which may be exercised as set forth in such
Warrants, to purchase from the Company and the Company shall issue and sell
to the Holder or such Holder the number of fully paid and nonassessable
Shares of Common Stock specified in such Warrants, upon surrender to the
Company, or its duly authorized agent, of such Warrants, with the form of
election to purchase attached thereto duly completed and signed, and upon
payment to the Company of the Exercise Price, as adjusted in accordance
with the provisions of Section 8 of this Agreement, for the number of
Shares in respect of which such Warrants are then exercised.
(b) The Purchase Price may be paid (i) in cash or by cashier's check
payable to the Company, (ii) by the surrender of Warrants owned by the
Holder or a permitted Holder having a Warrant Value (as defined below) on
the date of exercise equal to the Purchase Price, (iii) by the surrender of
shares of the Company's Common Stock in good form for transfer, owned by
the Holder and having a Fair Market Value (as defined below) on the date of
exercise equal to the Purchase Price, or (iv) any combination of the
foregoing. The term "Warrant Value" shall mean the difference between the
Exercise Price per share and the Fair Market Value (as defined below) per
share multiplied by the number of Warrants being surrendered. The term
"Fair Market Value" shall mean the average over the previous five (5)
trading days of the reported high and low sales price on the Nasdaq Small
Cap Market, the Nasdaq National Market System, or such other national
securities exchange on which the Company's shares may be traded, or if not
trading on the Nasdaq Small Cap Market, the Nasdaq National Market System,
or a national securities exchange, the average of the closing bid and asked
prices in the over-the-counter market as furnished by any New York Stock
Exchange member firm selected from time to time by the Company for that
purpose.
(c) No adjustment shall be made for any dividends on any Shares issuable
upon exercise of a Warrant. Upon each surrender of Warrants 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 or the permitted Holder of such Warrants and in such name or names
as the Holder or such Holder may designate, a certificate or certificates
for the number of full Shares so purchased upon the exercise of such
Warrants, together with cash, as provided in Section 9 of this Agreement,
in respect of any fractional Shares otherwise issuable upon such surrender.
Such certificate or certificates shall be deemed to have been issued and
any person so designated to be named therein shall be deemed to have become
a holder of record of such Shares as of the date of the surrender of
Warrants and payment of the Exercise Price as
Page 2 of Eight
<PAGE>
aforesaid; PROVIDED, HOWEVER, that if, at the date of surrender of such
Warrants and payment of such Exercise Price, the transfer books for the
Common Stock or other class of securities issuable upon the exercise of
such Warrants shall be closed, the certificates for the Shares shall be
issuable as of the date on which such books shall next be opened (whether
before, on or after the Warrant Expiration Date) and until such date the
Company shall be under no duty to deliver any certificate for such Shares;
PROVIDED, FURTHER, HOWEVER, that the transfer books of record, unless
otherwise required by law, shall not be closed at any one time for a period
longer than five (5) days. The rights of purchase represented by the
Warrants shall be exercisable, at the election of the Holder(s) thereof,
either in full or from time to time in part and, in the event that any
Warrant is exercised in respect of less than all of the Shares issuable
upon such exercise at any time prior to the Warrant Expiration Date, a new
Warrant or Warrants will be issued for the remaining number of Shares
specified in the Warrant so surrendered.
5. PAYMENT OF TAXES. The Company will pay all documentary stamp taxes, if
any, attributable to the issuance of Shares upon the exercise of Warrants;
provided, however, that the Company shall not be required to pay any tax or
taxes which may be payable solely in respect of any transfer involved in the
issue or delivery of any certificates for Shares in a name other than that of
the Holder or a permitted Holder of Warrants in respect of which such Shares
are issued.
6. MUTILATED OR MISSING WARRANTS. In case any of the Warrants shall be
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 of interest,
but only upon receipt of evidence reasonably satisfactory to the Company of
such mutilation, loss, theft or destruction of such Warrant and indemnity, if
requested, reasonably satisfactory to the Company. An applicant for such
substitute Warrants shall also comply with such other reasonable regulations
and pay such other reasonable charges and expenses as the Company may
prescribe.
7. RESERVATION OF SHARES, ETC. There have been reserved, and the Company
shall at all times keep reserved, out of the authorized and unissued Common
Stock, a number of shares of Common Stock sufficient to provide for the
exercise of the rights of purchase represented by the outstanding Warrants.
American Securities Transfer, Incorporated, transfer agent for the Common
Stock (the "Transfer Agent"), and every subsequent transfer agent, if any,
for the Company's securities issuable upon the exercise of the Warrants will
be irrevocably authorized and directed at all times until the Warrant
Expiration Date to reserve such number of authorized and unissued shares as
shall be required for such purpose. The Company will keep a copy of this
Agreement on file with the Transfer Agent and with every subsequent transfer
agent for any shares of the Company's securities issuable upon the exercise
of the Warrants. The Company will supply the Transfer Agent or any subsequent
transfer agent with duly executed certificates for such purpose and will
itself provide or otherwise make available any cash which may be
distributable as provided in Section 9 of this Agreement. All Warrants
surrendered in the exercise of the rights thereby evidenced shall be
canceled, and such canceled Warrants shall constitute sufficient evidence of
the number of Shares that have been issued upon the exercise of such
Warrants. No shares of Common Stock shall be subject to reservation in
respect of unexercised Warrants subsequent to the Warrant Expiration Date.
8. ADJUSTMENTS OF EXERCISE PRICE AND NUMBER OF SHARES. The Exercise Price
and the number and kind of securities issuable upon exercise of each Warrant
shall be subject to adjustment from time to time upon the happening of
certain events, as follows:
(a) In case the Company shall (i) declare a dividend on its Common Stock
in shares of Common Stock or make a distribution in shares of Common Stock
(other than an issuance of Common Stock for valuable consideration), (ii)
subdivide its outstanding shares of Common Stock, (iii) combine its
outstanding shares of Common Stock in to a smaller number of shares of
Common Stock or (iv) issue by reclassification of its shares of Common
Stock other securities of
Page 3 of Eight
<PAGE>
the Company (including any such reclassification in connection with the
consolidation or merger in which the Company is the continuing corporation),
the number of Shares purchasable upon exercise of each Warrant immediately
prior thereto shall be adjusted so that the Holder and any permitted Holder
of each Warrant shall be entitled to receive the kind and number of Shares
or other securities of the Company which he would have owned or have been
entitled to receive after the happening of any of the events described
above, had such Warrant been exercised immediately prior to the happening
of such event or any record date with respect thereto. An adjustment made
pursuant to this paragraph (a) shall become effective immediately after the
effective date of such event retroactive to immediately after the record
date, if any, for such event.
(b) No adjustment in the number of Shares purchasable hereunder shall be
required unless such adjustment would require an increase or decrease of at
least one percent (1%) in the number of Shares purchasable upon the
exercise of each Warrant; provided, however, that any adjustments which by
reason of this paragraph (e) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment but not later
than five (5) years after the happening of the specified event or events.
All calculations shall be made to the nearest one thousandth of a share.
(c) Whenever the number of Shares purchasable upon the exercise of each
Warrant is adjusted, as herein provided, the Exercise Price shall be
adjusted by multiplying the Exercise Price in effect immediately prior to
such adjustment by a fraction, of which the numerator shall be the number
of Shares purchasable upon the exercise of each Warrant immediately prior
to such adjustment, and of which the denominator shall be the number of
Shares so purchasable immediately thereafter.
(d) For the purpose of this Section 8, the term "shares of Common Stock"
shall mean (i) the class of stock designated as the Common Stock of the
Company at the date of this Agreement or (ii) any other class of stock
resulting from successive changes or reclassifications of such shares
consisting solely of changes in par value, or from no par value to par
value, or from par value to no par value.
(e) Whenever the number of Shares issuable upon the exercise of each
Warrant or the Exercise price of such Shares is adjusted, as herein
provided, the Company shall promptly mail by first class mail, postage
prepaid, to the Holder and/or each permitted Holder notice of such
adjustment or adjustments. The Company shall retain a firm of independent
public accountants (who may be the regular accountants employed by the
Company) to make any computation required by this Section 8 and shall cause
such accountants to prepare a certificate setting forth the number of
Shares issuable upon the exercise of each Warrant and the Exercise Price of
such Shares after such adjustment, setting forth a brief statement of the
facts requiring such adjustment and setting forth the computation by which
such adjustment was made. Such certificate shall be conclusive as to the
correctness of such adjustment and the Holder and/or each permitted Holder
shall have the right to inspect such certificate during reasonable business
hours.
(f) Except as provided in this Section 8, no adjustment in respect of any
dividends shall be made during the term of a Warrant or upon the exercise
of a Warrant.
(g) If any capital reorganization, recapitalization 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 the
Company's assets to another person or entity, or any other transaction
(collectively, an "Organic Change") shall be effected in such a way that
holders of shares of Common Stock shall be entitled to receive stock,
securities or assets with respect to or in exchange for shares of Common
Stock (such stock, securities or assets being hereinafter
Page 4 of Eight
<PAGE>
referred to as "substitute property"), then, as a condition of such
Organic Change, lawful and adequate provision shall be made whereby the
Holder and the permitted Holder shall thereafter have the right to purchase
and receive upon the basis and upon the terms and conditions specified
herein and in lieu of the shares of Common Stock immediately theretofore
purchasable and receivable upon the exercise of the Warrants, such
substituted property 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 shares of Common Stock immediately theretofore purchasable and
receivable upon the exercise of the Warrants had such Organic Change not
taken place. Further, in any such case appropriate provision shall be made
with respect to the rights and interests of the Holder and the permitted
Holder to the end that the provision hereof (including without limitation
provisions for adjustments of the Exercise Price and of the number of shares
purchasable and receivable upon the exercise of the Warrants) shall
thereafter be applicable, as nearly as may be, in relation to any
substituted property thereafter purchasable and receivable upon the exercise
of the Warrants. The Company shall not effect any such Organic Change,
unless prior to the consummation thereof the successor entity (if other than
the Company) resulting from such consolidation or merger or the corporation
purchasing the assets shall assume by written instrument approved by the
board of directors of the Company the obligation to deliver to the Holders
such substituted property as, in accordance with the foregoing provisions,
the Holders may be entitled to purchase and receive.
(h) Notwithstanding any adjustment in the Exercise Price or the number or
kind of shares purchasable upon the exercise of the Warrants pursuant to
this Agreement, certificates for Warrants issued prior or subsequent to
such adjustment may continue to express the same price and number and kind
of Shares as are initially issuable pursuant to this Agreement.
9. FRACTIONAL INTERESTS. The Company shall not be required to issue
fractions of Shares on the exercise of Warrants. If more than one Warrant
shall be presented for exercise in full at the same time by the Holder or the
same permitted Holder, the number of Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Shares issuable on exercise of the Warrants so presented. If any fraction of
a Share would, except for the provisions of this Section 9, be issuable on
the exercise of any Warrant (or specified portions thereof), the Company
shall purchase such fraction for an amount in cash equal to the same fraction
of the current market price per share of Common Stock (determined as provided
in Section 8(d) of this Agreement) on the date of exercise.
10. REGISTRATION RIGHTS.
(a) DEMAND REGISTRATION RIGHTS. The Company covenants and agrees with the
Holder and any other or subsequent Holders of the Registrable Securities
(as defined in paragraph (e) of this Section 10) that, upon written request
of the then Holder(s) of at least a majority of the Registrable Securities
under Warrants which were originally issued to the Holder, the Company will
file, from time to time as requested, as promptly as practicable and, in
any event, within ninety (90) days after receipt of such written request,
at the sole expense to the Holder and/or any other or subsequent Holders of
the Registrable Securities, a registration statement (the "Registration
Statement"), under the Act, registering or qualifying the Registrable
Securities for sale. The Company will use its best efforts, through its
officers, directors, auditors and counsel in all matters necessary or
advisable, to file and cause to become effective such Registration
Statement as promptly as practicable and of a period of two (2) years
thereafter to reflect in the Registration Statement financial statements
which are prepared in accordance with Section 10(a)(3) of the Act and any
facts or event arising that, individually, or in the aggregate, represent a
fundamental and/or material change in the information set forth in the
Registration Statement to enable the Holder or any permitted Holders of the
Warrants to, subject to Section 4, exercise such Warrants and sell Shares,
or to enable any holders of Shares to sell such Shares, during said two-year
period. The Holders may sell the Registrable Securities pursuant to the
Registration Statement without exercising the Warrants.
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<PAGE>
(b) PIGGYBACK REGISTRATION RIGHTS. The Company covenants and agrees with
the Holder and any subsequent Holders of the Registrable Securities that
if, at any time after the Warrants become exercisable, it proposes to file
a Registration Statement with respect to any class of equity or
equity-related security under the Act in a primary registration on behalf of
the Company and/or in a secondary registration on behalf of holders of such
securities and the registration form to be used may be used for registration
of the Registrable Securities, the Company will give prompt written notice
to the Holders of Registrable Securities (regardless of whether some of the
Holders shall have theretofore availed themselves of the right provided in
Section 10(a) of this Agreement) at the addresses appearing on the records
of the Company of its intention to file a registration statement and will
offer to include in such registration statement to the maximum extent
possible, subject to paragraphs (i) and (ii) of this paragraph (b), such
number of Registrable Securities with respect to which the Company has
received written requests for inclusion therein within ten (10) business
days after the Holder(s) receive notice from the Company. All registrations
requested pursuant to this paragraph (b) are referred to herein as
"Piggyback Registrations". This paragraph is not applicable to a
registration statement filed by the Company with the Commission on Forms S-4
or S-8 or any successor forms thereto.
(i) PRIORITY ON PRIMARY REGISTRATIONS. If a Piggyback Registration
includes an underwritten primary registration on behalf of such
Company and the underwriter(s) for such offering determines in good
faith and advises the Company in writing that in its/their opinion the
number of Registrable Securities requested to be included in such
registration exceeds the number that can be sold in such offering
without materially adversely affecting the distribution of such
securities by the Company, the Company will include in such
registration (A) first, the securities that the Company proposed to
sell and (B) second, the Registrable Securities requested to be
included in such registration, apportioned pro rata among the Holders
of Registrable Securities and (C) third, securities of the holders of
other securities requesting registration.
(ii) PRIORITY ON SECONDARY REGISTRATIONS. If a Piggyback Registration
consists only of an underwritten secondary registration on behalf of
holders of securities of the Company (other than pursuant to Section
10(a)), and the underwriter(s) for such offering advises the Company
in writing that in its/their opinion the number of Registrable
Securities requested to be included in such registration exceeds the
number which can be sold in such offering without materially adversely
affecting the distribution of such securities by the Company, the
Company will include in such registration (A) first, the securities
requested to be included therein by the holders requesting such
registration and the Registrable Securities requested to be included
in such registration, pro rata among all such holders on the basis of
the number of shares requested to be included by each such holder and
(B) second, other securities requested to be included in such
registration.
(c) OTHER REGISTRATION RIGHTS. In addition to the rights above provided,
the Company will cooperate with the then Holders of the Registrable
Securities in preparing and signing any registration statement, in addition
to the registration statements discussed above, required in order to sell
or transfer the Registrable Securities and will supply all information
required therefor, but such additional registration statement, shall be at
the then Holders' cost and expense; PROVIDED, HOWEVER, that if the Company
elects to register or qualify additional shares of Common Stock, the cost
and expense of such registration statement will be pro rated between the
Company and the Holders of the Registrable Securities according to the
aggregate sales price of the securities being issued.
Page 6 of Eight
<PAGE>
(d) All registration expenses (as hereinafter defined) in connection with
a Demand or Piggyback Registration shall be borne by the Company and all
selling expenses (as hereinafter defined) in connection with a Demand or
Piggyback Registration shall be borne by the Holders. The term
"registration expenses" shall mean all expenses, except selling expenses,
incurred by the Company in complying with the registration rights granted
in this Section 11, including all registration, qualification, and filing
expenses; printing expenses; escrow fees; fees and disbursements of counsel
for the Company, blue sky fees and expenses; and fees and disbursements of
the Company's independent auditors. The term "selling expenses" shall mean
all underwriting discounts and selling commissions, if any, applicable to
the Registrable Securities and expenses of counsel for the Holders. All
selling expenses shall be borne by the Holders in an amount equal to their
pro rata share of the Registrable Securities included in the Registration
Statement.
(e) For purposes of this Section 10, (I) the term "Holder" shall be
holders of Shares, and (ii)the term "Registrable Securities" shall mean the
Shares, if issued.
11. VOTING RIGHTS. Nothing contained in this Agreement or in any of the
Warrants shall be construed as conferring upon the Holders thereof the right
to vote or to receive dividends or to consent or to receive notice as
shareholders in respect of the meetings of shareholders or the election of
directors of the Company or any other matter, or any rights whatsoever as
shareholders of the Company.
12. NOTICES.
(a) Any notice pursuant to this Agreement to be given or made by the
Holder of any Warrant and/or the holder of any Share to or on the Company
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed as follows or to such other address as the Company may
designate by notice given in accordance with this Section 12, to the Holder
and any permitted Holders of Warrants and/or the holders of Shares:
GB FOODS CORPORATION
23 Corporate Plaza, Suite 246
Newport Beach, California 92660
Attention: Corporate Secretary
Notices or demands authorized by this Agreement to be given or made by the
Company to or on the Holder and any permitted Holder of any Warrant and/or
the holder of any share shall be sufficiently given or made (except as
otherwise provided in this Agreement) if sent by first-class mail, postage
prepaid, addressed to the Holder or such Holder or such holder of Shares at
the address of the Holder or such Holder or such holder of Shares as shown
on the Warrant Register or the books of the Company, as the case may be.
(b) If at any time prior to the expiration of the Warrants and their
exercise, any of the following events shall occur:
(i) the Company shall take a record of the holders of its shares of
Common Stock for the purpose of entitling them to receive a dividend
or distribution payable otherwise than in cash, or a cash dividend or
distribution payable otherwise than out of current or retained
earnings, as indicated by the accounting treatment of such dividend or
distribution on the books of the Company; or
(ii) the Company shall offer to all the holders of its Common Stock
any additional shares of capital stock of the Company or securities
convertible into or exchangeable for shares of capital stock of the
Company, or any option, right or warrant to subscribe therefore; or
Page 7 of Eight
<PAGE>
(iii) a dissolution, liquidation or winding-up of the Company
(other than in connection with a consolidation or merger) or a sale of
all or substantially all of its property, assets and business as an
entirety shall be proposed; or
(iv) there shall be any capital reorganization or reclassification of
the capital stock of the Company, or consolidation or merger of the
Company with another entity;
then, in any one or more of said events, the Company shall give written
notice of such event at least twenty (20) days prior to the date fixed as a
record date or the date of closing the transfer books for the determination
of the stockholders entitled to such dividend, distribution, convertible or
exchangeable securities or subscription rights, options or warrants, or
entitled to vote on such proposed dissolution, liquidation, winding up or
sale. Such notice shall specify such record date or the date of closing
the transfer books, as the case may be. Failure to give such notice or any
defect therein shall not affect the validity of any action taken in
connection with the declaration or payment of any such divided or
distribution, or the issuance of any convertible or exchangeable securities
or subscription rights, options or warrants, or any proposed dissolution,
liquidation, winding-up or sale.
13. GOVERNING LAW. This Agreement and each Warrant issued hereunder shall be
governed by and construed in accordance with the substantive laws of the
State of Delaware. The Company hereby agrees to accept service of process by
notice given to it pursuant to the provisions of Section 12.
14. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original;
but such counterparts together shall constitute but one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day, month and year first above written.
GB FOODS CORPORATION
By: /s/ Bruce H. Haglund
--------------------------------
Its: Secretary
-------------------------------
FIDELITY NATIONAL FINANCIAL, INC.
By:
--------------------------------
Its:
--------------------------------
Page 8 of Eight
<PAGE>
THE WARRANTS AND THE SHARES OF COMMON STOCK REFERRED TO HEREIN HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 NOR QUALIFIED UNDER APPLICABLE
STATE SECURITIES LAWS IN RELIANCE UPON EXEMPTIONS THEREFROM. THESE WARRANTS MAY
BE ACQUIRED FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO DISTRIBUTION OR
RESALE, AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED OR OFFERED TO BE SO TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH WARRANTS UNDER THE SECURITIES ACT OF 1933 AND THE REGULATIONS
PROMULGATED PURSUANT THERETO (UNLESS EXEMPT THEREFROM), AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY, THAT ANY SUCH TRANSACTION SHALL NOT VIOLATE ANY
FEDERAL OR STATE SECURITIES LAWS, OR THE WRITTEN CONSENT OF THE COMPANY.
WARRANT CERTIFICATE
FOR PURCHASE OF COMMON STOCK
1,500,000 WARRANTS
GB FOODS CORPORATION
A DELAWARE CORPORATION
Initial Issuance on November 23, 1992
(Transferred to the Registered Holder on July 21, 1997)
Void after 5:00 p.m. California Time, November 23, 2002
This certifies that for value received FIDELITY NATIONAL FINANCIAL,
INC., or registered assigns (the "Registered Holder"), is the owner of
1,500,000 Common Stock Purchase Warrants (the "Warrants") specified above
issued in accordance with that certain Warrant Agreement dated July 21, 1997
by and between GB FOODS CORPORATION, a Delaware corporation (the "Company")
and FIDELITY NATIONAL FINANCIAL, INC., a Delaware corporation (the "Warrant
Agreement"). Each Warrant entitles the Registered Holder to purchase,
subject to the terms and conditions set forth in the Warrant Agreement, one
fully paid and nonassessable share of Common Stock, no par value, of the
Company, at any time prior to 5:00 P.M., California time, on November 23,
2002 (the "Expiration Date"), upon the presentation and surrender of this
Warrant Certificate with the Subscription Form on the reverse hereof duly
executed, at the Company's office, or its successor or agent (the "Warrant
Agent") accompanied by payment of $5.00 per share (the "Purchase Price") in
lawful money of the United States of America in cash or by official bank or
certified check made payable to the Company at 23 Corporate Plaza, Suite 246,
Newport Beach, California 92660. At the option of the Registered Holder, the
Warrants may be exercised by surrender of this Warrant Certificate for the
Warrant Value (as defined in the Warrant Agreement). The Company will act as
Warrant Agent until further notice to the Registered Holder.
In the event of certain contingencies provided for in the Warrant
Agreement, the Purchase Price or the number of shares of Common Stock subject
to purchase upon the exercise of each Warrant represented hereby are subject
to modification or adjustment.
If the Expiration Date shall in the State of California be a holiday or a
day on which the banks are authorized to close, then the Expiration Date
shall mean 5:00 P.M., California time, the next following day which in the
State of California is not a holiday or a day on which banks are authorized
to close.
GB FOODS CORPORATION
23 Corporate Plaza, Suite 246
Newport Beach, California 92660
1
<PAGE>
Each Warrant represented hereby is exercisable at the option of the
Registered Holder, but no fractional shares of Common Stock will be issued.
In the case of the exercise of less than all the Warrants represented hereby,
the Company shall cancel the Warrant Certificate upon the surrender hereof
and shall execute and deliver a new Warrant Certificate or Warrant
Certificates of like tenor, which the Warrant Agent shall countersign, for
the balance of such Warrants.
This Warrant shall not be exercisable by a Registered Holder in any state
where such exercise would be unlawful.
This Warrant Certificate is exchangeable, upon the surrender hereof by
the Registered Holder at the corporate office of the Warrant Agent, for a new
Warrant Certificate or Warrant Certificates of like tenor representing an
equal aggregate number of Warrants, each of such new Warrant Certificates to
represent such number of Warrants as shall be designated by such Registered
Holder at the time of such surrender. Upon due presentment with any tax or
other governmental charge imposed in connection therewith, for registration
of transfer of this Warrant Certificate at such office, a new Warrant
Certificate or Warrant Certificates representing an equal aggregate number of
Warrants will be issued to the transferee in exchange thereof, subject to the
limitations provided in the Warrant Agreement.
The Company has agreed to register the shares issuable upon exercise of
the Warrants under certain conditions as set forth in the Warrant Agreement.
The Company agrees at all times to reserve or hold available a sufficient
number of Common Shares to cover the number of shares issuable upon the
exercise of this and all other Warrants or like tenor then outstanding.
Prior to the exercise of any Warrant represented hereby, the Registered
Holder shall not be entitled to any rights of a shareholder of the Company,
including, without limitation, the right to vote or to receive any notice of
any proceedings of the Company. No dividends shall be payable or accrue in
respect of this Warrant or the interest represented hereby or the shares
purchasable hereunder until or unless, and except to the extent that, this
Warrant shall be exercised.
Except as otherwise above provided, this Warrant and all rights hereunder
are transferable by the Registered Holder hereof in person or by duly
authorized attorney on the books of the Company upon surrender of this
Warrant, properly endorsed to the Company, only after approval by the Board
of Directors of the Company.
The Company may deem and treat the registered owner of this Warrant at
any time as the absolute owner hereof for all purposes and shall not be
affected by any notice to the contrary.
If at any time or from time to time the Company shall declare a stock
dividend or, by subdivision, consolidation, or reclassification of shares, or
otherwise, change as a whole the outstanding Common Shares into a different
number of a class of shares, the number and class of shares so changed shall,
for the purposes of this Warrant and the terms and conditions hereof, replace
the shares outstanding immediately prior to such change, and the Warrant
purchase price in effect, and the number of shares purchasable under this
Warrant, immediately prior to the date upon which such change shall become
effective, shall be proportionately adjusted. Irrespective of any adjustment
or change in the Warrant purchase price or the number of Common Shares
actually purchasable under this or any other Warrant of like tenor, the
Warrants theretofore and thereafter issued may continue to express the
Warrant purchase price per share and the number of shares purchasable
thereunder as the Warrant purchase price per share and the number of shares
purchasable were expressed upon the Warrants when initially issued.
2
<PAGE>
Upon the happening of any event requiring an adjustment of the Warrant
purchase price hereunder, the Company shall forthwith give written notice
thereof to the Registered Holder stating the adjusted Warrant purchase price
and the adjusted number of Common Shares purchasable upon the exercise hereof
resulting from such event and setting forth in reasonable detail the method
of calculation and the facts upon which such calculation is based, The Board
of Directors of the Company shall determine the computation made hereunder.
In case any voluntary or involuntary dissolution, liquidation, or winding up
of the Company shall at any time be proposed, the Company shall give at least
20 days' prior written notice thereof to the Registered Holder stating the
date on which such event is to take place and the date (which shall be at
least 20 days after the giving of such notice) as of which the holders of
Common Shares of record shall be entitled to exchange their Common Shares for
securities or other property deliverable upon such dissolution, liquidation,
or winding up (on which date, in the event such dissolution, liquidation, or
winding up shall actually take place, this Warrant and all rights with
respect hereto shall terminate). Notices pursuant to this paragraph shall be
given by first class mail, postage prepaid, addressed to the registered
holder of this Warrant at the address of such holder appearing in the records
of the Company.
For the purposes of the foregoing paragraphs, the term "Common Shares"
shall include the aggregate number of shares that the Company, by its
Articles of Incorporation, as from time to time amended, is authorized to
issue, which are not limited to a fixed sum or percentage of the par value in
respect of the rights of the holders thereof to participate in dividends or
in distribution of assets upon the voluntary or involuntary liquidation,
dissolution, or winding up of the Company.
Any conflict in the terms of this Warrant Certificate and the terms of
the Warrant Agreement shall be resolved with reference to the terms of the
Warrant Agreement. This Warrant Certificate shall be governed by and
construed in accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
duly executed by its duly authorized officer and its corporate seal to be
imprinted hereon this 21st day of July, 1997.
GB FOODS CORPORATION
By: /s/ Bruce H. Haglund
-----------------------------
Bruce H. Haglund,
Secretary
CORPORATE SEAL
3
<PAGE>
ASSIGNMENT
(To be executed by the Registered Holder to effect
a transfer of the Warrant. No transfer or assignment shall be
valid unless countersigned by the Secretary of GB Foods Corporation, which
signature shall evidence approval by the Board of Directors.)
For value received _________________________________________ hereby sells,
assigns, and transfers unto __________________________________________________
this Warrant and the rights represented thereby to purchase Common Shares in
accordance with the terms and conditions thereof, and does hereby irrevocably
constitute and appoint the duly elected and acting Secretary of GB Foods
Corporation as attorney-in-fact to transfer this Warrant on the books of GB
Foods Corporation, with full power of substitution.
Dated: Signed:
-------------------- -------------------------------------
, Registered Holder
Countersigned:
GB Foods Corporation
By:
-----------------------------
Its Secretary
4
<PAGE>
SUBSCRIPTION FORM
(To be Executed by the Registered Holder in Order to Exercise Warrants)
The undersigned Registered Holder hereby irrevocably elects to exercise
______________ Warrants represented by the attached Warrant Certificate, and
to purchase the securities issuable upon the exercise of such Warrants,
tenders $____________ as payment therefor and requests that certificates for
such securities shall be issued in the name of
[PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
[Please print or type name and address]
and be delivered to
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
[please print or type name and address]
and if such number of Warrants shall not be all the Warrants evidenced by
this Warrant Certificate, that a new Warrant Certificate for the balance of
such Warrants be registered in the name of, and delivered to, the Registered
Holder at the address stated below.
Dated:
----------- ------------------------------------------
Signature of Registered Holder
------------------------------------------
------------------------------------------
Address
------------------------------------------
Taxpayer Identification Number
------------------------------------------
Signature Guaranteed
ACCEPTED:
GB FOODS CORPORATION
By:
-------------------------------
, Authorized Officer
5
<PAGE>
GB FOODS CORPORATION
WARRANT AGREEMENT
THIS WARRANT AGREEMENT dated as of July 21, 1997, is entered into by and
among GB FOODS CORPORATION, a Delaware corporation, (the "Company"), and
FIDELITY NATIONAL FINANCIAL, INC., a Delaware corporation (the "Holder").
The Company proposes to issue to the Holder warrants as hereinafter
described (the "Warrants") to purchase up to an aggregate of ONE MILLION
(1,000,000) shares, subject to adjustment as provided in Section 8 hereof (such
1,000,000 shares, as adjusted, being hereinafter referred to as the "Shares") of
the Company's Common Stock, par value $0.08 (the "Common Stock"), each Warrant
entitling the holder ("Holder") thereof to purchase one share of Common Stock.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth and for other good and valuable consideration, the parties
hereto agree as follows:
1. TRANSFER OF WARRANTS: FORM OF WARRANT. On the date hereof, in connection
with the sale and assignment of the Warrants to the Holder pursuant to terms of
that certain Stock and Warrant Purchase Agreement dated July 20, 1997 by and
among William M. Theisen, the Company, and the Holder, the Holder hereby issues
and delivers the Warrants to the Holder. The form of the Warrant and of the
form of election to purchase Shares to be attached thereto shall be
substantially as set forth on the attachments hereto entitled "Warrant
Certificate." The Warrants shall be executed on behalf of the Company by the
manual or facsimile signature of the then present Chairman or Co-Chairman,
President or any Vice President of the Company, under its corporate seal,
affixed or in facsimile, and attested by the manual or facsimile signature of
the present or any future Secretary or Assistant Secretary of the Company.
2. REGISTRATION. The Warrants shall be numbered and shall be registered in a
Warrant register (the "Warrant Register"). Subject to the provisions of Section
3, the Company shall be entitled to treat the registered holder of any Warrant
on the Warrant Register as the owner in fact thereof for all purposes and shall
not be bound to recognize any equitable or other claim to or interest in such
Warrant on the part of any other person, and shall not be liable for any
registration of transfer of Warrants which are registered or are to be
registered in the name of a fiduciary or the nominee of a fiduciary unless made
with the actual knowledge that a fiduciary or nominee is committing a breach of
trust in requesting such registration of transfer, or with such knowledge of
such facts that its participation therein amounts to bad faith. The Warrants
shall be registered initially in the name of the Holder.
3. WARRANTS TRANSFERABILITY LIMITED. The Warrants are expressly hereby made
non-transferable and shall not be sold, transferred, assigned or hypothecated,
in part or in whole, except upon the liquidation and dissolution of the Holder
or the prior written consent of the Company. Any permitted transfer will be
allowed only upon delivery of the Warrant Certificate duly endorsed by the
Holder or by his duly authorized attorney or representative, or accompanied by
proper evidence of succession, assignment or authority to transfer and
contingent upon approval by the Board of Directors of the Company. Such
permitted transfer, of the Warrants shall be effective as of the date of such
endorsement or other proper evidence. In all cases of transfer by an attorney,
the original power of attorney, duly approved, or an official copy thereof, duly
certified, shall be deposited with the Company. Such permitted transfer of the
Warrants shall be effective as of the date of such endorsement or other proper
evidence. In all cases of transfer by an attorney, the original power of
attorney, duly approved, or an official copy thereof, duly certified, shall be
deposited with the Company. In case of transfer by executors, administrators,
guardians or other legal representatives, duly authenticated evidence of their
authority shall be produced, and may be required to be deposited with the
Company in its discretion. Upon any registration of transfer, the Company shall
deliver a
Page 1 of Eight
<PAGE>
new Warrant or Warrants to the person entitled thereto. The Warrants may be
exchanged at the option of the Holder thereof for other Warrants of different
denominations, of like tenor and representing in the aggregate the right to
purchase a like number of shares of Common Stock upon surrender to the
Company or its duly authorized agent. The Company may require payment of the
sum sufficient to cover all applicable taxes and other governmental charges
that may be imposed in connection with any voluntary transfer, exchange or
other disposition of the Warrants. Notwithstanding the foregoing, the
Company shall have no obligation to cause Warrants to be transferred on its
books to any person, if such transfer would violate the registration
provisions of Securities Act of 1933, as amended (the "Act"), unless an
exemption under the Act is available therefor.
4. TERM OF WARRANTS; EXERCISE OF WARRANTS.
(a) Subject to Paragraph 4(d) below, each Warrant entitles the registered
owner thereof to purchase one Share at a purchase price of Seven Dollars
($7.00) per Share (as adjusted from time to time pursuant to the provisions
hereof, the "Exercise Price") at any time or from time to time the date of
this Agreement until 5:00 p.m., California time, May 1, 2005 (the "Warrant
Expiration Date"). The Exercise Price and the Shares issuable upon
exercise of Warrants are subject to adjustment upon the occurrence of
certain events, pursuant to the provisions of Section 8 of this Agreement.
Subject to the provisions of the Agreement, the Holder or a permitted
Holder shall have the right, which may be exercised as set forth in such
Warrants, to purchase from the Company and the Company shall issue and sell
to the Holder or such Holder the number of fully paid and nonassessable
Shares of Common Stock specified in such Warrants, upon surrender to the
Company, or its duly authorized agent, of such Warrants, with the form of
election to purchase attached thereto duly completed and signed, and upon
payment to the Company of the Exercise Price, as adjusted in accordance
with the provisions of Section 8 of this Agreement, for the number of
Shares in respect of which such Warrants are then exercised.
(b) The Purchase Price may be paid (i) in cash or by cashier's check
payable to the Company, (ii) by the surrender of Warrants owned by the
Holder or a permitted Holder having a Warrant Value (as defined below) on
the date of exercise equal to the Purchase Price, (iii) by the surrender of
shares of the Company's Common Stock in good form for transfer, owned by
the Holder and having a Fair Market Value (as defined below) on the date of
exercise equal to the Purchase Price, or (iv) any combination of the
foregoing. The term Warrant Value shall mean the difference between the
Exercise Price per share and the Fair Market Value (as defined below) per
share multiplied by the number of Warrants being surrendered. The term
"Fair Market Value" shall mean the average over the previous five (5)
trading days of the reported high and low sales price on the Nasdaq Small
Cap Market, the Nasdaq National Market System, or such other national
securities exchange on which the Company's shares may be traded, or if not
trading on the Nasdaq Small Cap Market, the Nasdaq National Market System,
or a national securities exchange, the average of the closing bid and asked
prices in the over-the-counter market as furnished by any New York Stock
Exchange member firm selected from time to time by the Company for that
purpose.
(c) No adjustment shall be made for any dividends on any Shares issuable
upon exercise of a Warrant. Upon each surrender of Warrants 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 or the permitted Holder of such Warrants and in such name or names
as the Holder or such Holder may designate, a certificate or certificates
for the number of full Shares so purchased upon the exercise of such
Warrants, together with cash, as provided in Section 9 of this Agreement,
in respect of any fractional Shares otherwise issuable upon such surrender.
Such certificate or certificates shall be deemed to have been issued and
any person so designated to be named therein shall be deemed to have become
a holder of record of such Shares as of the date of the surrender of
Warrants and payment of the Exercise Price as aforesaid; PROVIDED, HOWEVER,
that if, at the date of surrender of such Warrants and payment
Page 2 of Eight
<PAGE>
of such Exercise Price, the transfer books for the Common Stock or other
class of securities issuable upon the exercise of such Warrants shall be
closed, the certificates for the Shares shall be issuable as of the date on
which such books shall next be opened (whether before, on or after the
Warrant Expiration Date) and until such date the Company shall be under
no duty to deliver any certificate for such Shares; PROVIDED, FURTHER,
HOWEVER, that the transfer books of record, unless otherwise required by
law, shall not be closed at any one time for a period longer than five
(5) days. The rights of purchase represented by the Warrants shall be
exercisable, at the election of the Holder(s) thereof, either in full or
from time to time in part and, in the event that any Warrant is exercised
in respect of less than all of the Shares issuable upon such exercise at
any time prior to the Warrant Expiration Date, a new Warrant or Warrants
will be issued for the remaining number of Shares specified in the Warrant
so surrendered.
5. PAYMENT OF TAXES. The Company will pay all documentary stamp taxes, if
any, attributable to the issuance of Shares upon the exercise of Warrants;
provided, however, that the Company shall not be required to pay any tax or
taxes which may be payable solely in respect of any transfer involved in the
issue or delivery of any certificates for Shares in a name other than that of
the Holder or a permitted Holder of Warrants in respect of which such Shares are
issued.
6. MUTILATED OR MISSING WARRANTS. In case any of the Warrants shall be
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 of interest, but only
upon receipt of evidence reasonably satisfactory to the Company of such
mutilation, loss, theft or destruction of such Warrant and indemnity, if
requested, reasonably satisfactory to the Company. An applicant for such
substitute Warrants shall also comply with such other reasonable regulations and
pay such other reasonable charges and expenses as the Company may prescribe.
7. RESERVATION OF SHARES, ETC. There have been reserved, and the Company
shall at all times keep reserved, out of the authorized and unissued Common
Stock, a number of shares of Common Stock sufficient to provide for the exercise
of the rights of purchase represented by the outstanding Warrants. American
Securities Transfer, Incorporated, transfer agent for the Common Stock (the
"Transfer Agent"), and every subsequent transfer agent, if any, for the
Company's securities issuable upon the exercise of the Warrants will be
irrevocably authorized and directed at all times until the Warrant Expiration
Date to reserve such number of authorized and unissued shares as shall be
required for such purpose. The Company will keep a copy of this Agreement on
file with the Transfer Agent and with every subsequent transfer agent for any
shares of the Company's securities issuable upon the exercise of the Warrants.
The Company will supply the Transfer Agent or any subsequent transfer agent with
duly executed certificates for such purpose and will itself provide or otherwise
make available any cash which may be distributable as provided in Section 9 of
this Agreement. All Warrants surrendered in the exercise of the rights thereby
evidenced shall be canceled, and such canceled Warrants shall constitute
sufficient evidence of the number of Shares that have been issued upon the
exercise of such Warrants. No shares of Common Stock shall be subject to
reservation in respect of unexercised Warrants subsequent to the Warrant
Expiration Date.
8. ADJUSTMENTS OF EXERCISE PRICE AND NUMBER OF SHARES. The Exercise Price and
the number and kind of securities issuable upon exercise of each Warrant shall
be subject to adjustment from time to time upon the happening of certain events,
as follows:
(a) In case the Company shall (i) declare a dividend on its Common Stock
in shares of Common Stock or make a distribution in shares of Common Stock
(other than an issuance of Common Stock for valuable consideration), (ii)
subdivide its outstanding shares of Common Stock, (iii) combine its
outstanding shares of Common Stock in to a smaller number of shares of
Common Stock or (iv) issue by reclassification of its shares of Common
Stock other securities of
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<PAGE>
the Company (including any such reclassification in connection with the
consolidation or merger in which the Company is the continuing corporation),
the number of Shares purchasable upon exercise of each Warrant immediately
prior thereto shall be adjusted so that the Holder and any permitted
Holder of each Warrant shall be entitled to receive the kind and number
of Shares or other securities of the Company which he would have owned
or have been entitled to receive after the happening of any of the events
described above, had such Warrant been exercised immediately prior to
the happening of such event or any record date with respect thereto. An
adjustment made pursuant to this paragraph (a) shall become effective
immediately after the effective date of such event retroactive to
immediately after the record date, if any, for such event.
(b) No adjustment in the number of Shares purchasable hereunder shall be
required unless such adjustment would require an increase or decrease of at
least one percent (1%) in the number of Shares purchasable upon the
exercise of each Warrant; provided, however, that any adjustments which by
reason of this paragraph (e) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment but not later
than five (5) years after the happening of the specified event or events.
All calculations shall be made to the nearest one thousandth of a share.
(c) Whenever the number of Shares purchasable upon the exercise of each
Warrant is adjusted, as herein provided, the Exercise Price shall be
adjusted by multiplying the Exercise Price in effect immediately prior to
such adjustment by a fraction, of which the numerator shall be the number
of Shares purchasable upon the exercise of each Warrant immediately prior
to such adjustment, and of which the denominator shall be the number of
Shares so purchasable immediately thereafter.
(d) For the purpose of this Section 8, the term "shares of Common Stock"
shall mean (i) the class of stock designated as the Common Stock of the
Company at the date of this Agreement or (ii) any other class of stock
resulting from successive changes or reclassifications of such shares
consisting solely of changes in par value, or from no par value to par
value, or from par value to no par value.
(e) Whenever the number of Shares issuable upon the exercise of each
Warrant or the Exercise price of such Shares is adjusted, as herein
provided, the Company shall promptly mail by first class mail, postage
prepaid, to the Holder and/or each permitted Holder notice of such
adjustment or adjustments. The Company shall retain a firm of independent
public accountants (who may be the regular accountants employed by the
Company) to make any computation required by this Section 8 and shall cause
such accountants to prepare a certificate setting forth the number of
Shares issuable upon the exercise of each Warrant and the Exercise Price of
such Shares after such adjustment, setting forth a brief statement of the
facts requiring such adjustment and setting forth the computation by which
such adjustment was made. Such certificate shall be conclusive as to the
correctness of such adjustment and the Holder and/or each permitted Holder
shall have the right to inspect such certificate during reasonable business
hours.
(f) Except as provided in this Section 8, no adjustment in respect of any
dividends shall be made during the term of a Warrant or upon the exercise
of a Warrant.
(g) If any capital reorganization, recapitalization 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 the
Company's assets to another person or entity, or any other transaction
(collectively, an "Organic Change") shall be effected in such a way that
holders of shares of Common Stock shall be entitled to receive stock,
securities or assets with respect to or in exchange for shares of Common
Stock (such stock, securities or assets being hereinafter
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<PAGE>
referred to as "substitute property"), then, as a condition of such Organic
Change, lawful and adequate provision shall be made whereby the Holder and
the permitted Holder shall thereafter have the right to purchase and receive
upon the basis and upon the terms and conditions specified herein and in
lieu of the shares of Common Stock immediately theretofore purchasable and
receivable upon the exercise of the Warrants, such substituted property 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 shares of Common
Stock immediately theretofore purchasable and receivable upon the exercise
of the Warrants had such Organic Change not taken place. Further, in any
such case appropriate provision shall be made with respect to the rights
and interests of the Holder and the permitted Holder to the end that the
provision hereof (including without limitation provisions for adjustments
of the Exercise Price and of the number of shares purchasable and
receivable upon the exercise of the Warrants) shall thereafter be
applicable, as nearly as may be, in relation to any substituted property
thereafter purchasable and receivable upon the exercise of the Warrants.
The Company shall not effect any such Organic Change, unless prior to the
consummation thereof the successor entity (if other than the Company)
resulting from such consolidation or merger or the corporation purchasing
the assets shall assume by written instrument approved by the board of
directors of the Company the obligation to deliver to the Holders such
substituted property as, in accordance with the foregoing provisions, the
Holders may be entitled to purchase and receive.
(h) Notwithstanding any adjustment in the Exercise Price or the number or
kind of shares purchasable upon the exercise of the Warrants pursuant to
this Agreement, certificates for Warrants issued prior or subsequent to
such adjustment may continue to express the same price and number and kind
of Shares as are initially issuable pursuant to this Agreement.
9. FRACTIONAL INTERESTS. The Company shall not be required to issue fractions
of Shares on the exercise of Warrants. If more than one Warrant shall be
presented for exercise in full at the same time by the Holder or the same
permitted Holder, the number of Shares which shall be issuable upon the exercise
thereof shall be computed on the basis of the aggregate number of Shares
issuable on exercise of the Warrants so presented. If any fraction of a Share
would, except for the provisions of this Section 9, be issuable on the exercise
of any Warrant (or specified portions thereof), the Company shall purchase such
fraction for an amount in cash equal to the same fraction of the current market
price per share of Common Stock (determined as provided in Section 8(d) of this
Agreement) on the date of exercise.
10. REGISTRATION RIGHTS.
(a) DEMAND REGISTRATION RIGHTS. The Company covenants and agrees with the
Holder and any other or subsequent Holders of the Registrable Securities
(as defined in paragraph (e) of this Section 10) that, upon written request
of the then Holder(s) of at least a majority of the Registrable Securities
under Warrants which were originally issued to the Holder, the Company will
file, from time to time as requested, as promptly as practicable and, in
any event, within ninety (90) days after receipt of such written request,
at the sole expense to the Holder and/or any other or subsequent Holders of
the Registrable Securities, a registration statement (the "Registration
Statement"), under the Act, registering or qualifying the Registrable
Securities for sale. The Company will use its best efforts, through its
officers, directors, auditors and counsel in all matters necessary or
advisable, to file and cause to become effective such Registration
Statement as promptly as practicable and of a period of two (2) years
thereafter to reflect in the Registration Statement financial statements
which are prepared in accordance with Section 10(a)(3) of the Act and any
facts or event arising that, individually, or in the aggregate, represent a
fundamental and/or material change in the information set forth in the
Registration Statement to enable the Holder or any permitted Holders of the
Warrants to, subject to Section 4, exercise such Warrants and sell Shares,
or to enable any holders of Shares to sell such Shares, during said
two-year period. The Holders may sell the Registrable Securities pursuant
to the Registration Statement without exercising the Warrants.
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<PAGE>
(b) PIGGYBACK REGISTRATION RIGHTS. The Company covenants and agrees with
the Holder and any subsequent Holders of the Registrable Securities that
if, at any time after the Warrants become exercisable, it proposes to file
a Registration Statement with respect to any class of equity or
equity-related security under the Act in a primary registration on behalf of
the Company and/or in a secondary registration on behalf of holders of such
securities and the registration form to be used may be used for
registration of the Registrable Securities, the Company will give prompt
written notice to the Holders of Registrable Securities (regardless of
whether some of the Holders shall have theretofore availed themselves of
the right provided in Section 10(a) of this Agreement) at the addresses
appearing on the records of the Company of its intention to file a
registration statement and will offer to include in such registration
statement to the maximum extent possible, subject to paragraphs (i) and
(ii) of this paragraph (b), such number of Registrable Securities with
respect to which the Company has received written requests for inclusion
therein within ten (10) business days after the Holder(s) receive notice
from the Company. All registrations requested pursuant to this paragraph
(b) are referred to herein as Piggyback Registrations". This paragraph is
not applicable to a registration statement filed by the Company with the
Commission on Forms S-4 or S-8 or any successor forms thereto.
(i) PRIORITY ON PRIMARY REGISTRATIONS. If a Piggyback Registration
includes an underwritten primary registration on behalf of such
Company and the underwriter(s) for such offering determines in good
faith and advises the Company in writing that in its/their opinion the
number of Registrable Securities requested to be included in such
registration exceeds the number that can be sold in such offering
without materially adversely affecting the distribution of such
securities by the Company, the Company will include in such
registration (A) first, the securities that the Company proposed to
sell and (B) second, the Registrable Securities requested to be
included in such registration, apportioned pro rata among the Holders
of Registrable Securities and (C) third, securities of the holders of
other securities requesting registration.
(ii) PRIORITY ON SECONDARY REGISTRATIONS. If a Piggyback Registration
consists only of an underwritten secondary registration on behalf of
holders of securities of the Company (other than pursuant to Section
10(a)), and the underwriter(s) for such offering advises the Company
in writing that in its/their opinion the number of Registrable
Securities requested to be included in such registration exceeds the
number which can be sold in such offering without materially adversely
affecting the distribution of such securities by the Company, the
Company will include in such registration (A) first, the securities
requested to be included therein by the holders requesting such
registration and the Registrable Securities requested to be included
in such registration, pro rata among all such holders on the basis of
the number of shares requested to be included by each such holder and
(B) second, other securities requested to be included in such
registration.
(c) OTHER REGISTRATION RIGHTS. In addition to the rights above provided,
the Company will cooperate with the then Holders of the Registrable
Securities in preparing and signing any registration statement, in addition
to the registration statements discussed above, required in order to sell
or transfer the Registrable Securities and will supply all information
required therefor, but such additional registration statement, shall be at
the then Holders' cost and expense; PROVIDED, HOWEVER, that if the Company
elects to register or qualify additional shares of Common Stock, the cost
and expense of such registration statement will be pro rated between the
Company and the Holders of the Registrable Securities according to the
aggregate sales price of the securities being issued.
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<PAGE>
(d) All registration expenses (as hereinafter defined) in connection with
a Demand or Piggyback Registration shall be borne by the Company and all
selling expenses (as hereinafter defined) in connection with a Demand or
Piggyback Registration shall be borne by the Holders. The term
"registration expenses" shall mean all expenses, except selling expenses,
incurred by the Company in complying with the registration rights granted
in this Section 11, including all registration, qualification, and filing
expenses; printing expenses; escrow fees; fees and disbursements of counsel
for the Company, blue sky fees and expenses; and fees and disbursements of
the Company's independent auditors. The term "selling expenses" shall mean
all underwriting discounts and selling commissions, if any, applicable to
the Registrable Securities and expenses of counsel for the Holders. All
selling expenses shall be borne by the Holders in an amount equal to their
pro rata share of the Registrable Securities included in the Registration
Statement.
(e) For purposes of this Section 10, (I) the term "Holder" shall be
holders of Shares, and (ii)the term "Registrable Securities" shall mean the
Shares, if issued.
11. VOTING RIGHTS. Nothing contained in this Agreement or in any of the
Warrants shall be construed as conferring upon the Holders thereof the right to
vote or to receive dividends or to consent or to receive notice as shareholders
in respect of the meetings of shareholders or the election of directors of the
Company or any other matter, or any rights whatsoever as shareholders of the
Company.
12. NOTICES.
(a) Any notice pursuant to this Agreement to be given or made by the
Holder of any Warrant and/or the holder of any Share to or on the Company
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed as follows or to such other address as the Company may
designate by notice given in accordance with this Section 12, to the Holder
and any permitted Holders of Warrants and/or the holders of Shares:
GB FOODS CORPORATION
23 Corporate Plaza, Suite 246
Newport Beach, California 92660
Attention: Corporate Secretary
Notices or demands authorized by this Agreement to be given or made by the
Company to or on the Holder and any permitted Holder of any Warrant and/or
the holder of any share shall be sufficiently given or made (except as
otherwise provided in this Agreement) if sent by first-class mail, postage
prepaid, addressed to the Holder or such Holder or such holder of Shares at
the address of the Holder or such Holder or such holder of Shares as shown
on the Warrant Register or the books of the Company, as the case may be.
(b) If at any time prior to the expiration of the Warrants and their
exercise, any of the following events shall occur:
(i) the Company shall take a record of the holders of its shares of
Common Stock for the purpose of entitling them to receive a dividend
or distribution payable otherwise than in cash, or a cash dividend or
distribution payable otherwise than out of current or retained
earnings, as indicated by the accounting treatment of such dividend or
distribution on the books of the Company; or
(ii) the Company shall offer to all the holders of its Common Stock
any additional shares of capital stock of the Company or securities
convertible into or exchangeable for shares of capital stock of the
Company, or any option, right or warrant to subscribe therefore; or
Page 7 of Eight
<PAGE>
(iii) a dissolution, liquidation or winding-up of the Company
(other than in connection with a consolidation or merger) or a sale of
all or substantially all of its property, assets and business as an
entirety shall be proposed; or
(iv) there shall be any capital reorganization or reclassification of
the capital stock of the Company, or consolidation or merger of the
Company with another entity;
then, in any one or more of said events, the Company shall give written
notice of such event at least twenty (20) days prior to the date fixed as a
record date or the date of closing the transfer books for the determination
of the stockholders entitled to such dividend, distribution, convertible or
exchangeable securities or subscription rights, options or warrants, or
entitled to vote on such proposed dissolution, liquidation, winding up or
sale. Such notice shall specify such record date or the date of closing
the transfer books, as the case may be. Failure to give such notice or any
defect therein shall not affect the validity of any action taken in
connection with the declaration or payment of any such divided or
distribution, or the issuance of any convertible or exchangeable securities
or subscription rights, options or warrants, or any proposed dissolution,
liquidation, winding-up or sale.
13. GOVERNING LAW. This Agreement and each Warrant issued hereunder shall be
governed by and construed in accordance with the substantive laws of the State
of Delaware. The Company hereby agrees to accept service of process by notice
given to it pursuant to the provisions of Section 12.
14. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original; but
such counterparts together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day, month and year first above written.
GB FOODS CORPORATION
By: /s/ Bruce H. Haglund
------------------------------
Its: SECRETARY
-----------------------------
FIDELITY NATIONAL FINANCIAL, INC.
By:
-------------------------------
Its:
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<PAGE>
THE WARRANTS AND THE SHARES OF COMMON STOCK REFERRED TO HEREIN HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 NOR QUALIFIED UNDER APPLICABLE
STATE SECURITIES LAWS IN RELIANCE UPON EXEMPTIONS THEREFROM. THESE WARRANTS MAY
BE ACQUIRED FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO DISTRIBUTION OR
RESALE, AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED OR OFFERED TO BE SO TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH WARRANTS UNDER THE SECURITIES ACT OF 1933 AND THE REGULATIONS
PROMULGATED PURSUANT THERETO (UNLESS EXEMPT THEREFROM), AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY, THAT ANY SUCH TRANSACTION SHALL NOT VIOLATE ANY
FEDERAL OR STATE SECURITIES LAWS, OR THE WRITTEN CONSENT OF THE COMPANY.
WARRANT CERTIFICATE
FOR PURCHASE OF COMMON STOCK
1,000,000 WARRANTS
GB FOODS CORPORATION
A DELAWARE CORPORATION
Initial Issuance on May 1, 1995
(Transferred to the Registered Holder on July 21, 1997)
Void after 5:00 p.m. California Time, May 1, 2005
This certifies that for value received FIDELITY NATIONAL FINANCIAL, INC.,
or registered assigns (the "Registered Holder"), is the owner of 1,000,000
Common Stock Purchase Warrants (the "Warrants") specified above issued in
accordance with that certain Warrant Agreement dated July 21, 1997 by and
between GB FOODS CORPORATION, a Delaware corporation (the "Company") and
FIDELITY NATIONAL FINANCIAL, INC., a Delaware corporation (the "Warrant
Agreement"). Each Warrant entitles the Registered Holder to purchase,
subject to the terms and conditions set forth in the Warrant Agreement, one
fully paid and nonassessable share of Common Stock, no par value, of the
Company, at any time prior to 5:00 P.M., California time, on May 1, 2005 (the
"Expiration Date"), upon the presentation and surrender of this Warrant
Certificate with the Subscription Form on the reverse hereof duly executed,
at the Company's office, or its successor or agent (the "Warrant Agent")
accompanied by payment of $7.00 per share (the "Purchase Price") in lawful
money of the United States of America in cash or by official bank or
certified check made payable to the Company at 23 Corporate Plaza, Suite 246,
Newport Beach, California 92660. At the option of the Registered Holder, the
Warrants may be exercised by surrender of this Warrant Certificate for the
Warrant Value (as defined in the Warrant Agreement). The Company will act as
Warrant Agent until further notice to the Registered Holder.
In the event of certain contingencies provided for in the Warrant
Agreement, the Purchase Price or the number of shares of Common Stock subject to
purchase upon the exercise of each Warrant represented hereby are subject to
modification or adjustment.
If the Expiration Date shall in the State of California be a holiday or a
day on which the banks are authorized to close, then the Expiration Date shall
mean 5:00 P.M., California time, the next following day which in the State of
California is not a holiday or a day on which banks are authorized to close.
GB FOODS CORPORATION
23 Corporate Plaza, Suite 246
Newport Beach, California 92660
1
<PAGE>
Each Warrant represented hereby is exercisable at the option of the
Registered Holder, but no fractional shares of Common Stock will be issued. In
the case of the exercise of less than all the Warrants represented hereby, the
Company shall cancel the Warrant Certificate upon the surrender hereof and shall
execute and deliver a new Warrant Certificate or Warrant Certificates of like
tenor, which the Warrant Agent shall countersign, for the balance of such
Warrants.
This Warrant shall not be exercisable by a Registered Holder in any state
where such exercise would be unlawful.
This Warrant Certificate is exchangeable, upon the surrender hereof by the
Registered Holder at the corporate office of the Warrant Agent, for a new
Warrant Certificate or Warrant Certificates of like tenor representing an equal
aggregate number of Warrants, each of such new Warrant Certificates to represent
such number of Warrants as shall be designated by such Registered Holder at the
time of such surrender. Upon due presentment with any tax or other governmental
charge imposed in connection therewith, for registration of transfer of this
Warrant Certificate at such office, a new Warrant Certificate or Warrant
Certificates representing an equal aggregate number of Warrants will be issued
to the transferee in exchange thereof, subject to the limitations provided in
the Warrant Agreement.
The Company has agreed to register the shares issuable upon exercise of the
Warrants under certain conditions as set forth in the Warrant Agreement.
The Company agrees at all times to reserve or hold available a sufficient
number of Common Shares to cover the number of shares issuable upon the exercise
of this and all other Warrants or like tenor then outstanding.
Prior to the exercise of any Warrant represented hereby, the Registered
Holder shall not be entitled to any rights of a shareholder of the Company,
including, without limitation, the right to vote or to receive any notice of any
proceedings of the Company. No dividends shall be payable or accrue in respect
of this Warrant or the interest represented hereby or the shares purchasable
hereunder until or unless, and except to the extent that, this Warrant shall be
exercised.
Except as otherwise above provided, this Warrant and all rights hereunder
are transferable by the Registered Holder hereof in person or by duly authorized
attorney on the books of the Company upon surrender of this Warrant, properly
endorsed to the Company, only after approval by the Board of Directors of the
Company.
The Company may deem and treat the registered owner of this Warrant at any
time as the absolute owner hereof for all purposes and shall not be affected by
any notice to the contrary.
If at any time or from time to time the Company shall declare a stock
dividend or, by subdivision, consolidation, or reclassification of shares, or
otherwise, change as a whole the outstanding Common Shares into a different
number of a class of shares, the number and class of shares so changed shall,
for the purposes of this Warrant and the terms and conditions hereof, replace
the shares outstanding immediately prior to such change, and the Warrant
purchase price in effect, and the number of shares purchasable under this
Warrant, immediately prior to the date upon which such change shall become
effective, shall be proportionately adjusted. Irrespective of any adjustment or
change in the Warrant purchase price or the number of Common Shares actually
purchasable under this or any other Warrant of like tenor, the Warrants
theretofore and thereafter issued may continue to express the Warrant purchase
price per share and the number of shares purchasable thereunder as the Warrant
purchase price per share and the number of shares purchasable were expressed
upon the Warrants when initially issued.
2
<PAGE>
Upon the happening of any event requiring an adjustment of the Warrant
purchase price hereunder, the Company shall forthwith give written notice
thereof to the Registered Holder stating the adjusted Warrant purchase price and
the adjusted number of Common Shares purchasable upon the exercise hereof
resulting from such event and setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based, The Board of
Directors of the Company shall determine the computation made hereunder. In
case any voluntary or involuntary dissolution, liquidation, or winding up of the
Company shall at any time be proposed, the Company shall give at least 20 days'
prior written notice thereof to the Registered Holder stating the date on which
such event is to take place and the date (which shall be at least 20 days after
the giving of such notice) as of which the holders of Common Shares of record
shall be entitled to exchange their Common Shares for securities or other
property deliverable upon such dissolution, liquidation, or winding up (on which
date, in the event such dissolution, liquidation, or winding up shall actually
take place, this Warrant and all rights with respect hereto shall terminate).
Notices pursuant to this paragraph shall be given by first class mail, postage
prepaid, addressed to the registered holder of this Warrant at the address of
such holder appearing in the records of the Company.
For the purposes of the foregoing paragraphs, the term "Common Shares"
shall include the aggregate number of shares that the Company, by its Articles
of Incorporation, as from time to time amended, is authorized to issue, which
are not limited to a fixed sum or percentage of the par value in respect of the
rights of the holders thereof to participate in dividends or in distribution of
assets upon the voluntary or involuntary liquidation, dissolution, or winding up
of the Company.
Any conflict in the terms of this Warrant Certificate and the terms of the
Warrant Agreement shall be resolved with reference to the terms of the Warrant
Agreement. This Warrant Certificate shall be governed by and construed in
accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
duly executed by its duly authorized officer and its corporate seal to be
imprinted hereon this 21st day of July, 1997.
GB FOODS CORPORATION
By: /s/ Bruce H. Haglund
----------------------------
Bruce H. Haglund,
Secretary
CORPORATE SEAL
3
<PAGE>
ASSIGNMENT
(To be executed by the Registered Holder to effect
a transfer of the Warrant. No transfer or assignment shall be
valid unless countersigned by the Secretary of GB Foods Corporation, which
signature shall evidence approval by the Board of Directors.)
For value received____________________________________________ hereby sells,
assigns, and transfers unto_______________________________________________
this Warrant and the rights represented thereby to purchase Common Shares in
accordance with the terms and conditions thereof, and does hereby irrevocably
constitute and appoint the duly elected and acting Secretary of GB Foods
Corporation as attorney-in-fact to transfer this Warrant on the books of GB
Foods Corporation, with full power of substitution.
Dated: Signed:
------------------- --------------------------------
, Registered Holder
Countersigned:
GB Foods Corporation
By:
------------------------
Its Secretary
4
<PAGE>
SUBSCRIPTION FORM
(To be Executed by the Registered Holder in Order to Exercise Warrants)
The undersigned Registered Holder hereby irrevocably elects to exercise
_________________________________ Warrants represented by the attached
Warrant Certificate, and to purchase the securities issuable upon the
exercise of such Warrants, tenders $_________________ as payment therefor and
requests that certificates for such securities shall be issued in the name of
[PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
[Please print or type name and address]
and be delivered to
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
[please print or type name and address]
and if such number of Warrants shall not be all the Warrants evidenced by
this Warrant Certificate, that a new Warrant Certificate for the balance of
such Warrants be registered in the name of, and delivered to, the Registered
Holder at the address stated below.
Dated:
---------------- -------------------------------
Signature of Registered Holder
-------------------------------
Address
-------------------------------
Taxpayer Identification Number
-------------------------------
Signature Guaranteed
ACCEPTED:
GB FOODS CORPORATION
By:
---------------------------------
, Authorized Officer
5
<PAGE>
GB FOODS CORPORATION
WARRANT AGREEMENT
THIS WARRANT AGREEMENT dated as of July 21, 1997, is entered into by and
among GB FOODS CORPORATION, a Delaware corporation, (the "Company"), and
FIDELITY NATIONAL FINANCIAL, INC., a Delaware corporation (the "Holder").
The Company proposes to issue to the Holder warrants as hereinafter
described (the "Warrants") to purchase up to an aggregate of ONE MILLION
(1,000,000) shares, subject to adjustment as provided in Section 8 hereof
(such 1,000,000 shares, as adjusted, being hereinafter referred to as the
"Shares") of the Company's Common Stock, par value $0.08 (the "Common
Stock"), each Warrant entitling the holder ("Holder") thereof to purchase one
share of Common Stock.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth and for other good and valuable consideration,
the parties hereto agree as follows:
1. ISSUANCE OF WARRANTS: FORM OF WARRANT. On the date hereof, in connection
with the sale and assignment of the Warrants to the Holder pursuant to terms
of that certain Warrant Purchase Agreement dated July 20, 1997 by and among
McGrath, North, Mullin & Kratz, P.C., the Company, and the Holder, the Holder
hereby issues and delivers the Warrants to the Holder. The form of the
Warrant and of the form of election to purchase Shares to be attached thereto
shall be substantially as set forth on the attachments hereto entitled
"Warrant Certificate." The Warrants shall be executed on behalf of the
Company by the manual or facsimile signature of the then present Chairman or
Co-Chairman, President or any Vice President of the Company, under its
corporate seal, affixed or in facsimile, and attested by the manual or
facsimile signature of the present or any future Secretary or Assistant
Secretary of the Company.
2. REGISTRATION. The Warrants shall be numbered and shall be registered in
a Warrant register (the "Warrant Register"). Subject to the provisions of
Section 3, the Company shall be entitled to treat the registered holder of
any Warrant on the Warrant Register as the owner in fact thereof for all
purposes and shall not be bound to recognize any equitable or other claim to
or interest in such Warrant on the part of any other person, and shall not be
liable for any registration of transfer of Warrants which are registered or
are to be registered in the name of a fiduciary or the nominee of a fiduciary
unless made with the actual knowledge that a fiduciary or nominee is
committing a breach of trust in requesting such registration of transfer, or
with such knowledge of such facts that its participation therein amounts to
bad faith. The Warrants shall be registered initially in the name of the
Holder.
3. WARRANTS TRANSFERABILITY LIMITED. The Warrants are expressly hereby made
non-transferable and shall not be sold, transferred, assigned or
hypothecated, in part or in whole, except upon the liquidation and
dissolution of the Holder or the prior written consent of the Company. Any
permitted transfer will be allowed only upon delivery of the Warrant
Certificate duly endorsed by the Holder or by his duly authorized attorney or
representative, or accompanied by proper evidence of succession, assignment
or authority to transfer and contingent upon approval by the Board of
Directors of the Company. Such permitted transfer, of the Warrants shall be
effective as of the date of such endorsement or other proper evidence. In
all cases of transfer by an attorney, the original power of attorney, duly
approved, or an official copy thereof, duly certified, shall be deposited
with the Company. Such permitted transfer of the Warrants shall be effective
as of the date of such endorsement or other proper evidence. In all cases of
transfer by an attorney, the original power of attorney, duly approved, or an
official copy thereof, duly certified, shall be deposited with the Company.
In case of transfer by executors, administrators, guardians or other legal
representatives, duly authenticated evidence of their authority shall be
produced, and may be required to be deposited with the Company in its
discretion. Upon any registration of transfer, the Company shall deliver a
Page 1 of Eight
<PAGE>
new Warrant or Warrants to the person entitled thereto. The Warrants may be
exchanged at the option of the Holder thereof for other Warrants of different
denominations, of like tenor and representing in the aggregate the right to
purchase a like number of shares of Common Stock upon surrender to the
Company or its duly authorized agent. The Company may require payment of the
sum sufficient to cover all applicable taxes and other governmental charges
that may be imposed in connection with any voluntary transfer, exchange or
other disposition of the Warrants. Notwithstanding the foregoing, the
Company shall have no obligation to cause Warrants to be transferred on its
books to any person, if such transfer would violate the registration
provisions of Securities Act of 1933, as amended (the "Act"), unless an
exemption under the Act is available therefor.
4. TERM OF WARRANTS; EXERCISE OF WARRANTS.
(a) Subject to Paragraph 4(d) below, each Warrant entitles the registered
owner thereof to purchase one Share at a purchase price of Seven Dollars
and Fifty Cents ($7.50) per Share (as adjusted from time to time pursuant
to the provisions hereof, the "Exercise Price") at any time or from time to
time the date of this Agreement until 5:00 p.m., California time, May 1,
2005 (the "Warrant Expiration Date"). The Exercise Price and the Shares
issuable upon exercise of Warrants are subject to adjustment upon the
occurrence of certain events, pursuant to the provisions of Section 8 of
this Agreement. Subject to the provisions of the Agreement, the Holder or
a permitted Holder shall have the right, which may be exercised as set
forth in such Warrants, to purchase from the Company and the Company shall
issue and sell to the Holder or such Holder the number of fully paid and
nonassessable Shares of Common Stock specified in such Warrants, upon
surrender to the Company, or its duly authorized agent, of such Warrants,
with the form of election to purchase attached thereto duly completed and
signed, and upon payment to the Company of the Exercise Price, as adjusted
in accordance with the provisions of Section 8 of this Agreement, for the
number of Shares in respect of which such Warrants are then exercised.
(b) The Purchase Price may be paid (i) in cash or by cashier's check
payable to the Company, (ii) by the surrender of Warrants owned by the
Holder or a permitted Holder having a Warrant Value (as defined below) on
the date of exercise equal to the Purchase Price, (iii) by the surrender of
shares of the Company's Common Stock in good form for transfer, owned by
the Holder and having a Fair Market Value (as defined below) on the date of
exercise equal to the Purchase Price, or (iv) any combination of the
foregoing. The term "Warrant Value" shall mean the difference between the
Exercise Price per share and the Fair Market Value (as defined below) per
share multiplied by the number of Warrants being surrendered. The term
"Fair Market Value" shall mean the average over the previous five (5)
trading days of the reported high and low sales price on the Nasdaq Small
Cap Market, the Nasdaq National Market System, or such other national
securities exchange on which the Company's shares may be traded, or if not
trading on the Nasdaq Small Cap Market, the Nasdaq National Market System,
or a national securities exchange, the average of the closing bid and asked
prices in the over-the-counter market as furnished by any New York Stock
Exchange member firm selected from time to time by the Company for that
purpose.
(c) No adjustment shall be made for any dividends on any Shares issuable
upon exercise of a Warrant. Upon each surrender of Warrants 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 or the permitted Holder of such Warrants and in such name or names
as the Holder or such Holder may designate, a certificate or certificates
for the number of full Shares so purchased upon the exercise of such
Warrants, together with cash, as provided in Section 9 of this Agreement,
in respect of any fractional Shares otherwise issuable upon such surrender.
Such certificate or certificates shall be deemed to have been issued and
any person so designated to be named therein shall be deemed to have become
a holder of record of such Shares as of the date of the surrender of
Warrants and payment of the Exercise Price as
Page 2 of Eight
<PAGE>
aforesaid; PROVIDED, HOWEVER, that if, at the date of surrender of such
Warrants and payment of such Exercise Price, the transfer books for the
Common Stock or other class of securities issuable upon the exercise of
such Warrants shall be closed, the certificates for the Shares shall be
issuable as of the date on which such books shall next be opened
(whether before, on or after the Warrant Expiration Date) and until such
date the Company shall be under no duty to deliver any certificate for
such Shares; PROVIDED, FURTHER, HOWEVER, that the transfer books of
record, unless otherwise required by law, shall not be closed at any one
time for a period longer than five (5) days. The rights of purchase
represented by the Warrants shall be exercisable, at the election of the
Holder(s) thereof, either in full or from time to time in part and, in
the event that any Warrant is exercised in respect of less than all of
the Shares issuable upon such exercise at any time prior to the Warrant
Expiration Date, a new Warrant or Warrants will be issued for the
remaining number of Shares specified in the Warrant so surrendered.
5. PAYMENT OF TAXES. The Company will pay all documentary stamp taxes, if
any, attributable to the issuance of Shares upon the exercise of Warrants;
provided, however, that the Company shall not be required to pay any tax or
taxes which may be payable solely in respect of any transfer involved in the
issue or delivery of any certificates for Shares in a name other than that of
the Holder or a permitted Holder of Warrants in respect of which such Shares are
issued.
6. MUTILATED OR MISSING WARRANTS. In case any of the Warrants shall be
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 of interest, but only
upon receipt of evidence reasonably satisfactory to the Company of such
mutilation, loss, theft or destruction of such Warrant and indemnity, if
requested, reasonably satisfactory to the Company. An applicant for such
substitute Warrants shall also comply with such other reasonable regulations and
pay such other reasonable charges and expenses as the Company may prescribe.
7. RESERVATION OF SHARES, ETC. There have been reserved, and the Company
shall at all times keep reserved, out of the authorized and unissued Common
Stock, a number of shares of Common Stock sufficient to provide for the exercise
of the rights of purchase represented by the outstanding Warrants. American
Securities Transfer, Incorporated, transfer agent for the Common Stock (the
"Transfer Agent"), and every subsequent transfer agent, if any, for the
Company's securities issuable upon the exercise of the Warrants will be
irrevocably authorized and directed at all times until the Warrant Expiration
Date to reserve such number of authorized and unissued shares as shall be
required for such purpose. The Company will keep a copy of this Agreement on
file with the Transfer Agent and with every subsequent transfer agent for any
shares of the Company's securities issuable upon the exercise of the Warrants.
The Company will supply the Transfer Agent or any subsequent transfer agent with
duly executed certificates for such purpose and will itself provide or otherwise
make available any cash which may be distributable as provided in Section 9 of
this Agreement. All Warrants surrendered in the exercise of the rights thereby
evidenced shall be canceled, and such canceled Warrants shall constitute
sufficient evidence of the number of Shares that have been issued upon the
exercise of such Warrants. No shares of Common Stock shall be subject to
reservation in respect of unexercised Warrants subsequent to the Warrant
Expiration Date.
8. ADJUSTMENTS OF EXERCISE PRICE AND NUMBER OF SHARES. The Exercise Price and
the number and kind of securities issuable upon exercise of each Warrant shall
be subject to adjustment from time to time upon the happening of certain events,
as follows:
(a) In case the Company shall (i) declare a dividend on its Common Stock
in shares of Common Stock or make a distribution in shares of Common Stock
(other than an issuance of Common Stock for valuable consideration), (ii)
subdivide its outstanding shares of Common Stock, (iii) combine its
outstanding shares of Common Stock in to a smaller number of shares of
Common Stock or (iv) issue by reclassification of its shares of Common
Stock other securities of
Page 3 of Eight
<PAGE>
the Company (including any such reclassification in connection with the
consolidation or merger in which the Company is the continuing
corporation), the number of Shares purchasable upon exercise of each
Warrant immediately prior thereto shall be adjusted so that the Holder
and any permitted Holder of each Warrant shall be entitled to receive
the kind and number of Shares or other securities of the Company which
he would have owned or have been entitled to receive after the happening
of any of the events described above, had such Warrant been exercised
immediately prior to the happening of such event or any record date with
respect thereto. An adjustment made pursuant to this paragraph (a)
shall become effective immediately after the effective date of such
event retroactive to immediately after the record date, if any, for such
event.
(b) No adjustment in the number of Shares purchasable hereunder shall be
required unless such adjustment would require an increase or decrease of at
least one percent (1%) in the number of Shares purchasable upon the
exercise of each Warrant; provided, however, that any adjustments which by
reason of this paragraph (e) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment but not later
than five (5) years after the happening of the specified event or events.
All calculations shall be made to the nearest one thousandth of a share.
(c) Whenever the number of Shares purchasable upon the exercise of each
Warrant is adjusted, as herein provided, the Exercise Price shall be
adjusted by multiplying the Exercise Price in effect immediately prior to
such adjustment by a fraction, of which the numerator shall be the number
of Shares purchasable upon the exercise of each Warrant immediately prior
to such adjustment, and of which the denominator shall be the number of
Shares so purchasable immediately thereafter.
(d) For the purpose of this Section 8, the term "shares of Common Stock"
shall mean (i) the class of stock designated as the Common Stock of the
Company at the date of this Agreement or (ii) any other class of stock
resulting from successive changes or reclassifications of such shares
consisting solely of changes in par value, or from no par value to par
value, or from par value to no par value.
(e) Whenever the number of Shares issuable upon the exercise of each
Warrant or the Exercise price of such Shares is adjusted, as herein
provided, the Company shall promptly mail by first class mail, postage
prepaid, to the Holder and/or each permitted Holder notice of such
adjustment or adjustments. The Company shall retain a firm of independent
public accountants (who may be the regular accountants employed by the
Company) to make any computation required by this Section 8 and shall cause
such accountants to prepare a certificate setting forth the number of
Shares issuable upon the exercise of each Warrant and the Exercise Price of
such Shares after such adjustment, setting forth a brief statement of the
facts requiring such adjustment and setting forth the computation by which
such adjustment was made. Such certificate shall be conclusive as to the
correctness of such adjustment and the Holder and/or each permitted Holder
shall have the right to inspect such certificate during reasonable business
hours.
(f) Except as provided in this Section 8, no adjustment in respect of any
dividends shall be made during the term of a Warrant or upon the exercise
of a Warrant.
(g) If any capital reorganization, recapitalization 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 the
Company's assets to another person or entity, or any other transaction
(collectively, an "Organic Change") shall be effected in such a way that
holders of shares of Common Stock shall be entitled to receive stock,
securities or assets with respect to or in exchange for shares of Common
Stock (such stock, securities or assets being hereinafter
Page 4 of Eight
<PAGE>
referred to as "substitute property"), then, as a condition of such
Organic Change, lawful and adequate provision shall be made whereby the
Holder and the permitted Holder shall thereafter have the right to
purchase and receive upon the basis and upon the terms and conditions
specified herein and in lieu of the shares of Common Stock immediately
theretofore purchasable and receivable upon the exercise of the
Warrants, such substituted property 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 shares of Common Stock immediately
theretofore purchasable and receivable upon the exercise of the Warrants
had such Organic Change not taken place. Further, in any such case
appropriate provision shall be made with respect to the rights and
interests of the Holder and the permitted Holder to the end that the
provision hereof (including without limitation provisions for
adjustments of the Exercise Price and of the number of shares
purchasable and receivable upon the exercise of the Warrants) shall
thereafter be applicable, as nearly as may be, in relation to any
substituted property thereafter purchasable and receivable upon the
exercise of the Warrants. The Company shall not effect any such Organic
Change, unless prior to the consummation thereof the successor entity
(if other than the Company) resulting from such consolidation or merger
or the corporation purchasing the assets shall assume by written
instrument approved by the board of directors of the Company the
obligation to deliver to the Holders such substituted property as, in
cacordance with the foregoing provisions, the Holders may be entitled to
purchase and receive.
(h) Notwithstanding any adjustment in the Exercise Price or the number or
kind of shares purchasable upon the exercise of the Warrants pursuant to
this Agreement, certificates for Warrants issued prior or subsequent to
such adjustment may continue to express the same price and number and kind
of Shares as are initially issuable pursuant to this Agreement.
9. FRACTIONAL INTERESTS. The Company shall not be required to issue fractions
of Shares on the exercise of Warrants. If more than one Warrant shall be
presented for exercise in full at the same time by the Holder or the same
permitted Holder, the number of Shares which shall be issuable upon the exercise
thereof shall be computed on the basis of the aggregate number of Shares
issuable on exercise of the Warrants so presented. If any fraction of a Share
would, except for the provisions of this Section 9, be issuable on the exercise
of any Warrant (or specified portions thereof), the Company shall purchase such
fraction for an amount in cash equal to the same fraction of the current market
price per share of Common Stock (determined as provided in Section 8(d) of this
Agreement) on the date of exercise.
10. REGISTRATION RIGHTS.
(a) DEMAND REGISTRATION RIGHTS. The Company covenants and agrees with the
Holder and any other or subsequent Holders of the Registrable Securities
(as defined in paragraph (e) of this Section 10) that, upon written request
of the then Holder(s) of at least a majority of the Registrable Securities
under Warrants which were originally issued to the Holder, the Company will
file, from time to time as requested, as promptly as practicable and, in
any event, within ninety (90) days after receipt of such written request,
at the sole expense to the Holder and/or any other or subsequent Holders of
the Registrable Securities, a registration statement (the "Registration
Statement"), under the Act, registering or qualifying the Registrable
Securities for sale. The Company will use its best efforts, through its
officers, directors, auditors and counsel in all matters necessary or
advisable, to file and cause to become effective such Registration
Statement as promptly as practicable and of a period of two (2) years
thereafter to reflect in the Registration Statement financial statements
which are prepared in accordance with Section 10(a)(3) of the Act and any
facts or event arising that, individually, or in the aggregate, represent a
fundamental and/or material change in the information set forth in the
Registration Statement to enable the Holder or any permitted Holders of the
Warrants to, subject to Section 4, exercise such Warrants and sell Shares,
or to enable any holders of Shares to sell such Shares, during said two-year
period. The Holders may sell the Registrable Securities pursuant to
the Registration Statement without exercising the Warrants.
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<PAGE>
(b) PIGGYBACK REGISTRATION RIGHTS. The Company covenants and agrees with
the Holder and any subsequent Holders of the Registrable Securities that
if, at any time after the Warrants become exercisable, it proposes to file
a Registration Statement with respect to any class of equity or
equity-related security under the Act in a primary registration on behalf of
the Company and/or in a secondary registration on behalf of holders of such
securities and the registration form to be used may be used for
registration of the Registrable Securities, the Company will give prompt
written notice to the Holders of Registrable Securities (regardless of
whether some of the Holders shall have theretofore availed themselves of
the right provided in Section 10(a) of this Agreement) at the addresses
appearing on the records of the Company of its intention to file a
registration statement and will offer to include in such registration
statement to the maximum extent possible, subject to paragraphs (i) and
(ii) of this paragraph (b), such number of Registrable Securities with
respect to which the Company has received written requests for inclusion
therein within ten (10) business days after the Holder(s) receive notice
from the Company. All registrations requested pursuant to this paragraph
(b) are referred to herein as "Piggyback Registrations". This paragraph is
not applicable to a registration statement filed by the Company with the
Commission on Forms S-4 or S-8 or any successor forms thereto.
(i) PRIORITY ON PRIMARY REGISTRATIONS. If a Piggyback Registration
includes an underwritten primary registration on behalf of such
Company and the underwriter(s) for such offering determines in good
faith and advises the Company in writing that in its/their opinion the
number of Registrable Securities requested to be included in such
registration exceeds the number that can be sold in such offering
without materially adversely affecting the distribution of such
securities by the Company, the Company will include in such
registration (A) first, the securities that the Company proposed to
sell and (B) second, the Registrable Securities requested to be
included in such registration, apportioned pro rata among the Holders
of Registrable Securities and (C) third, securities of the holders of
other securities requesting registration.
(ii) PRIORITY ON SECONDARY REGISTRATIONS. If a Piggyback Registration
consists only of an underwritten secondary registration on behalf of
holders of securities of the Company (other than pursuant to Section
10(a)), and the underwriter(s) for such offering advises the Company
in writing that in its/their opinion the number of Registrable
Securities requested to be included in such registration exceeds the
number which can be sold in such offering without materially adversely
affecting the distribution of such securities by the Company, the
Company will include in such registration (A) first, the securities
requested to be included therein by the holders requesting such
registration and the Registrable Securities requested to be included
in such registration, pro rata among all such holders on the basis of
the number of shares requested to be included by each such holder and
(B) second, other securities requested to be included in such
registration.
(c) OTHER REGISTRATION RIGHTS. In addition to the rights above provided,
the Company will cooperate with the then Holders of the Registrable
Securities in preparing and signing any registration statement, in addition
to the registration statements discussed above, required in order to sell
or transfer the Registrable Securities and will supply all information
required therefor, but such additional registration statement, shall be at
the then Holders' cost and expense; PROVIDED, HOWEVER, that if the Company
elects to register or qualify additional shares of Common Stock, the cost
and expense of such registration statement will be pro rated between the
Company and the Holders of the Registrable Securities according to the
aggregate sales price of the securities being issued.
Page 6 of Eight
<PAGE>
(d) All registration expenses (as hereinafter defined) in connection with
a Demand or Piggyback Registration shall be borne by the Company and all
selling expenses (as hereinafter defined) in connection with a Demand or
Piggyback Registration shall be borne by the Holders. The term
"registration expenses" shall mean all expenses, except selling expenses,
incurred by the Company in complying with the registration rights granted
in this Section 11, including all registration, qualification, and filing
expenses; printing expenses; escrow fees; fees and disbursements of counsel
for the Company, blue sky fees and expenses; and fees and disbursements of
the Company's independent auditors. The term "selling expenses" shall mean
all underwriting discounts and selling commissions, if any, applicable to
the Registrable Securities and expenses of counsel for the Holders. All
selling expenses shall be borne by the Holders in an amount equal to their
pro rata share of the Registrable Securities included in the Registration
Statement.
(e) For purposes of this Section 10, (I) the term "Holder" shall be
holders of Shares, and (ii)the term "Registrable Securities" shall mean the
Shares, if issued.
11. VOTING RIGHTS. Nothing contained in this Agreement or in any of the
Warrants shall be construed as conferring upon the Holders thereof the right to
vote or to receive dividends or to consent or to receive notice as shareholders
in respect of the meetings of shareholders or the election of directors of the
Company or any other matter, or any rights whatsoever as shareholders of the
Company.
12. NOTICES.
(a) Any notice pursuant to this Agreement to be given or made by the
Holder of any Warrant and/or the holder of any Share to or on the Company
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed as follows or to such other address as the Company may
designate by notice given in accordance with this Section 12, to the Holder
and any permitted Holders of Warrants and/or the holders of Shares:
GB FOODS CORPORATION
23 Corporate Plaza, Suite 246
Newport Beach, California 92660
Attention: Corporate Secretary
Notices or demands authorized by this Agreement to be given or made by the
Company to or on the Holder and any permitted Holder of any Warrant and/or
the holder of any share shall be sufficiently given or made (except as
otherwise provided in this Agreement) if sent by first-class mail, postage
prepaid, addressed to the Holder or such Holder or such holder of Shares at
the address of the Holder or such Holder or such holder of Shares as shown
on the Warrant Register or the books of the Company, as the case may be.
(b) If at any time prior to the expiration of the Warrants and their
exercise, any of the following events shall occur:
(i) the Company shall take a record of the holders of its shares of
Common Stock for the purpose of entitling them to receive a dividend
or distribution payable otherwise than in cash, or a cash dividend or
distribution payable otherwise than out of current or retained
earnings, as indicated by the accounting treatment of such dividend or
distribution on the books of the Company; or
(ii) the Company shall offer to all the holders of its Common Stock
any additional shares of capital stock of the Company or securities
convertible into or exchangeable for shares of capital stock of the
Company, or any option, right or warrant to subscribe therefore; or
Page 7 of Eight
<PAGE>
(iii) a dissolution, liquidation or winding-up of the Company (other
than in connection with a consolidation or merger) or a sale of all
or substantially all of its property, assets and business as an
entirety shall be proposed; or
(iv) there shall be any capital reorganization or reclassification of
the capital stock of the Company, or consolidation or merger of the
Company with another entity;
then, in any one or more of said events, the Company shall give written
notice of such event at least twenty (20) days prior to the date fixed as a
record date or the date of closing the transfer books for the determination
of the stockholders entitled to such dividend, distribution, convertible or
exchangeable securities or subscription rights, options or warrants, or
entitled to vote on such proposed dissolution, liquidation, winding up or
sale. Such notice shall specify such record date or the date of closing
the transfer books, as the case may be. Failure to give such notice or any
defect therein shall not affect the validity of any action taken in
connection with the declaration or payment of any such divided or
distribution, or the issuance of any convertible or exchangeable securities
or subscription rights, options or warrants, or any proposed dissolution,
liquidation, winding-up or sale.
13. GOVERNING LAW. This Agreement and each Warrant issued hereunder shall be
governed by and construed in accordance with the substantive laws of the State
of Delaware. The Company hereby agrees to accept service of process by notice
given to it pursuant to the provisions of Section 12.
14. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original; but
such counterparts together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day, month and year first above written.
GB FOODS CORPORATION
By: /s/ Bruce H. Haglund
-------------------------------------
Its: Secretary
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FIDELITY NATIONAL FINANCIAL, INC.
By:
-------------------------------------
Its:
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<PAGE>
THE WARRANTS AND THE SHARES OF COMMON STOCK REFERRED TO HEREIN HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 NOR QUALIFIED UNDER APPLICABLE
STATE SECURITIES LAWS IN RELIANCE UPON EXEMPTIONS THEREFROM. THESE WARRANTS MAY
BE ACQUIRED FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO DISTRIBUTION OR
RESALE, AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED OR OFFERED TO BE SO TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH WARRANTS UNDER THE SECURITIES ACT OF 1933 AND THE REGULATIONS
PROMULGATED PURSUANT THERETO (UNLESS EXEMPT THEREFROM), AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY, THAT ANY SUCH TRANSACTION SHALL NOT VIOLATE ANY
FEDERAL OR STATE SECURITIES LAWS, OR THE WRITTEN CONSENT OF THE COMPANY.
WARRANT CERTIFICATE
FOR PURCHASE OF COMMON STOCK
1,000,000 WARRANTS
GB FOODS CORPORATION
A DELAWARE CORPORATION
Initial Issuance on May 1, 1995
(Transferred to the Registered Holder on July 21, 1997)
Void after 5:00 p.m. California Time, May 1, 2005
This certifies that for value received FIDELITY NATIONAL FINANCIAL,
INC., or registered assigns (the "Registered Holder"), is the owner of
1,000,000 Common Stock Purchase Warrants (the "Warrants") specified above
issued in accordance with that certain Warrant Agreement dated July 21, 1997
by and between GB FOODS CORPORATION, a Delaware corporation (the "Company")
and FIDELITY NATIONAL FINANCIAL, INC., a Delaware corporation (the "Warrant
Agreement"). Each Warrant entitles the Registered Holder to purchase,
subject to the terms and conditions set forth in the Warrant Agreement, one
fully paid and nonassessable share of Common Stock, no par value, of the
Company, at any time prior to 5:00 P.M., California time, on May 1, 2005 (the
"Expiration Date"), upon the presentation and surrender of this Warrant
Certificate with the Subscription Form on the reverse hereof duly executed,
at the Company's office, or its successor or agent (the "Warrant Agent")
accompanied by payment of $7.50 per share (the "Purchase Price") in lawful
money of the United States of America in cash or by official bank or
certified check made payable to the Company at 23 Corporate Plaza, Suite 246,
Newport Beach, California 92660. At the option of the Registered Holder, the
Warrants may be exercised by surrender of this Warrant Certificate for the
Warrant Value (as defined in the Warrant Agreement). The Company will act as
Warrant Agent until further notice to the Registered Holder.
In the event of certain contingencies provided for in the Warrant
Agreement, the Purchase Price or the number of shares of Common Stock subject
to purchase upon the exercise of each Warrant represented hereby are subject
to modification or adjustment.
If the Expiration Date shall in the State of California be a holiday or a
day on which the banks are authorized to close, then the Expiration Date
shall mean 5:00 P.M., California time, the next following day which in the
State of California is not a holiday or a day on which banks are authorized
to close.
GB FOODS CORPORATION
23 Corporate Plaza, Suite 246
Newport Beach, California 92660
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<PAGE>
Each Warrant represented hereby is exercisable at the option of the
Registered Holder, but no fractional shares of Common Stock will be issued.
In the case of the exercise of less than all the Warrants represented hereby,
the Company shall cancel the Warrant Certificate upon the surrender hereof
and shall execute and deliver a new Warrant Certificate or Warrant
Certificates of like tenor, which the Warrant Agent shall countersign, for
the balance of such Warrants.
This Warrant shall not be exercisable by a Registered Holder in any state
where such exercise would be unlawful.
This Warrant Certificate is exchangeable, upon the surrender hereof by
the Registered Holder at the corporate office of the Warrant Agent, for a new
Warrant Certificate or Warrant Certificates of like tenor representing an
equal aggregate number of Warrants, each of such new Warrant Certificates to
represent such number of Warrants as shall be designated by such Registered
Holder at the time of such surrender. Upon due presentment with any tax or
other governmental charge imposed in connection therewith, for registration
of transfer of this Warrant Certificate at such office, a new Warrant
Certificate or Warrant Certificates representing an equal aggregate number of
Warrants will be issued to the transferee in exchange thereof, subject to the
limitations provided in the Warrant Agreement.
The Company has agreed to register the shares issuable upon exercise of
the Warrants under certain conditions as set forth in the Warrant Agreement.
The Company agrees at all times to reserve or hold available a sufficient
number of Common Shares to cover the number of shares issuable upon the
exercise of this and all other Warrants or like tenor then outstanding.
Prior to the exercise of any Warrant represented hereby, the Registered
Holder shall not be entitled to any rights of a shareholder of the Company,
including, without limitation, the right to vote or to receive any notice of
any proceedings of the Company. No dividends shall be payable or accrue in
respect of this Warrant or the interest represented hereby or the shares
purchasable hereunder until or unless, and except to the extent that, this
Warrant shall be exercised.
Except as otherwise above provided, this Warrant and all rights hereunder
are transferable by the Registered Holder hereof in person or by duly
authorized attorney on the books of the Company upon surrender of this
Warrant, properly endorsed to the Company, only after approval by the Board
of Directors of the Company.
The Company may deem and treat the registered owner of this Warrant at
any time as the absolute owner hereof for all purposes and shall not be
affected by any notice to the contrary.
If at any time or from time to time the Company shall declare a stock
dividend or, by subdivision, consolidation, or reclassification of shares, or
otherwise, change as a whole the outstanding Common Shares into a different
number of a class of shares, the number and class of shares so changed shall,
for the purposes of this Warrant and the terms and conditions hereof, replace
the shares outstanding immediately prior to such change, and the Warrant
purchase price in effect, and the number of shares purchasable under this
Warrant, immediately prior to the date upon which such change shall become
effective, shall be proportionately adjusted. Irrespective of any adjustment
or change in the Warrant purchase price or the number of Common Shares
actually purchasable under this or any other Warrant of like tenor, the
Warrants theretofore and thereafter issued may continue to express the
Warrant purchase price per share and the number of shares purchasable
thereunder as the Warrant purchase price per share and the number of shares
purchasable were expressed upon the Warrants when initially issued.
2
<PAGE>
Upon the happening of any event requiring an adjustment of the Warrant
purchase price hereunder, the Company shall forthwith give written notice
thereof to the Registered Holder stating the adjusted Warrant purchase price
and the adjusted number of Common Shares purchasable upon the exercise hereof
resulting from such event and setting forth in reasonable detail the method
of calculation and the facts upon which such calculation is based, The Board
of Directors of the Company shall determine the computation made hereunder.
In case any voluntary or involuntary dissolution, liquidation, or winding up
of the Company shall at any time be proposed, the Company shall give at least
20 days' prior written notice thereof to the Registered Holder stating the
date on which such event is to take place and the date (which shall be at
least 20 days after the giving of such notice) as of which the holders of
Common Shares of record shall be entitled to exchange their Common Shares for
securities or other property deliverable upon such dissolution, liquidation,
or winding up (on which date, in the event such dissolution, liquidation, or
winding up shall actually take place, this Warrant and all rights with
respect hereto shall terminate). Notices pursuant to this paragraph shall be
given by first class mail, postage prepaid, addressed to the registered
holder of this Warrant at the address of such holder appearing in the records
of the Company.
For the purposes of the foregoing paragraphs, the term "Common Shares"
shall include the aggregate number of shares that the Company, by its
Articles of Incorporation, as from time to time amended, is authorized to
issue, which are not limited to a fixed sum or percentage of the par value in
respect of the rights of the holders thereof to participate in dividends or
in distribution of assets upon the voluntary or involuntary liquidation,
dissolution, or winding up of the Company.
Any conflict in the terms of this Warrant Certificate and the terms of
the Warrant Agreement shall be resolved with reference to the terms of the
Warrant Agreement. This Warrant Certificate shall be governed by and
construed in accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
duly executed by its duly authorized officer and its corporate seal to be
imprinted hereon this 21st day of July, 1997.
GB FOODS CORPORATION
By: /s/Bruce H. Haglund
-------------------------------
Bruce H. Haglund,
Secretary
CORPORATE SEAL
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<PAGE>
ASSIGNMENT
(To be executed by the Registered Holder to effect
a transfer of the Warrant. No transfer or assignment shall be
valid unless countersigned by the Secretary of GB Foods Corporation, which
signature shall evidence approval by the Board of Directors.)
For value received___________________________________________ hereby sells,
assigns, and transfers unto___________________________________________________
this Warrant and the rights represented thereby to purchase Common Shares in
accordance with the terms and conditions thereof, and does hereby irrevocably
constitute and appoint the duly elected and acting Secretary of GB Foods
Corporation as attorney-in-fact to transfer this Warrant on the books of GB
Foods Corporation, with full power of substitution.
Dated: Signed:
---------------------- ---------------------------------
, Registered Holder
Countersigned:
GB Foods Corporation
By:
-------------------------
Its Secretary
4
<PAGE>
SUBSCRIPTION FORM
(To be Executed by the Registered Holder in Order to Exercise Warrants)
The undersigned Registered Holder hereby irrevocably elects to exercise
_______________________________ Warrants represented by the attached Warrant
Certificate, and to purchase the securities issuable upon the exercise of such
Warrants, tenders $________________ as payment therefor and requests that
certificates for such securities shall be issued in the name of
[PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
[Please print or type name and address]
and be delivered to
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
[please print or type name and address]
and if such number of Warrants shall not be all the Warrants evidenced by
this Warrant Certificate, that a new Warrant Certificate for the balance of
such Warrants be registered in the name of, and delivered to, the Registered
Holder at the address stated below.
Dated:
-------------------- ----------------------------------
Signature of Registered Holder
----------------------------------
----------------------------------
Address
----------------------------------
Taxpayer Identification Number
----------------------------------
Signature Guaranteed
ACCEPTED:
GB FOODS CORPORATION
By:
--------------------------------------
, Authorized Officer
5
