SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D**
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
AER Energy Resources, Inc.
(Name of Issuer)
Common Stock, No Par Value
(Title of Class of Securities)
000944108
(Cusip Number)
J. Taylor Crandall
201 Main Street
Fort Worth, Texas 76102
(817) 390-8400
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 3, 2000
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box [ ].
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
**The total number of shares reported herein is 3,618,402 shares, which
constitutes approximately 14.0% of the 25,798,257 shares of Stock deemed
outstanding pursuant to Rule 13d-3(d)(1)(i) under the Act. Unless otherwise
stated, all ownership percentages set forth herein assume that there are
24,850,263 shares outstanding.
<PAGE>
1. Name of Reporting Person:
Keystone, Inc.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: WC
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 1,000,000 (1)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 1,000,000 (1)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
1,000,000
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 4.0%
14. Type of Reporting Person: CO
- ------------
(1) Power is exercised through its President and sole director, Robert M. Bass.
<PAGE>
1. Name of Reporting Person:
Robert M. Bass
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: USA
7. Sole Voting Power: 1,000,000 (1)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 1,000,000 (1)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
1,000,000 (1)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 4.0%
14. Type of Reporting Person: IN
- ------------
(1) Solely in his capacity as President and sole director of Keystone, Inc.
<PAGE>
1. Name of Reporting Person:
FW AER Partners, L.P.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: 00 - Contributions from Partners
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 1,584,158 (1)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 1,584,158 (1)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
2,419,158 (2)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 9.4% (3)
14. Type of Reporting Person: PN
- ------------
(1) Power is exercised by its sole general partner, Group 31, Inc.
(2) Includes 835,000 shares of Common Stock that may be acquired upon the
exercise of warrants.
(3) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there are
25,685,263 shares of the Stock outstanding.
<PAGE>
1. Name of Reporting Person:
Group 31, Inc.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 1,584,158 (1)(2)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 1,584,158 (1)(2)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
2,419,158 (2)(3)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 9.4% (4)
14. Type of Reporting Person: CO
- ------------
(1) Power is exercised by its President, J. Taylor Crandall.
(2) Solely in its capacity as the sole general partner of FW AER Partners, L.P.
(3) Includes 835,000 shares of Common Stock that may be acquired upon the
exercise of warrants.
(4) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there are
25,685,263 shares of the Stock outstanding.
<PAGE>
1. Name of Reporting Person:
J. Taylor Crandall
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: USA
7. Sole Voting Power: 1,584,158 (1)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 1,584,158 (1)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
2,532,152 (1)(2)(3)(4)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 9.8% (5)
14. Type of Reporting Person: IN
- ------------
(1) Solely in his capacity as the President of Group 31, Inc., general partner
of FW AER Partners, L.P., with respect to 2,419,158 shares of the Stock.
(2) Includes 835,000 shares of Common Stock that may be acquired upon the
exercise of warrants held by FW AER Partners, L.P.
(3) Solely in his capacity as the President of Group III 31, L.L.C., general
partner of FW AER II, L.P., with respect to 112,194 shares of the Stock.
(4) Includes 112,994 shares of Common Stock that may be acquired upon the
exercise of warrants held by FW AER II, L.P.
(5) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there are
25,798,257 shares of the Stock outstanding.
<PAGE>
1. Name of Reporting Person:
FW AER II, L.P.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: 00 - Contributions from Partners
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: Delaware
7. Sole Voting Power: -0-
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: -0-
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
112,994 (1)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 0.5% (2)
14. Type of Reporting Person: PN
- ------------
(1) Represents shares of Common Stock that may be acquired upon the exercise of
warrants.
(2) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there are
24,963,257 shares of the Stock outstanding.
<PAGE>
1. Name of Reporting Person:
Group III 31, L.L.C.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: Delaware
7. Sole Voting Power: -0-
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: -0-
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
112,994 (1)(2)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 0.5% (3)
14. Type of Reporting Person: OO-Other
- ------------
(1) Solely in its capacity as the sole general partner of FW AER II, L.P.
(2) Represents shares of Common Stock that may be acquired upon the exercise of
warrants.
(3) Assumes, pursuant to Rule 13d-3(d)(1)(i) under the Act, that there are
24,963,257 shares of the Stock outstanding.
<PAGE>
1. Name of Reporting Person:
David G. Brown
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: PF
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: USA
7. Sole Voting Power: -0-
Number of
Units
Beneficially 8. Shared Voting Power: 86,250 (1)
Owned By
Each
Reporting 9. Sole Dispositive Power: -0-
Person
With
10. Shared Dispositive Power: 86,250 (1)
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
86,250 (1)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 0.3%
14. Type of Reporting Person: IN
- ------------
(1) Owned in joint tenancy with his wife, Maureen Brown, who shares voting and
dispositive power over such shares.
<PAGE>
1. Name of Reporting Person:
Maureen Brown
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: PF
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: USA
7. Sole Voting Power: -0-
Number of
Units
Beneficially 8. Shared Voting Power: 86,250 (1)
Owned By
Each
Reporting 9. Sole Dispositive Power: -0-
Person
With
10. Shared Dispositive Power: 86,250 (1)
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
86,250 (1)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 0.3%
14. Type of Reporting Person: IN
- ------------
(1) Owned in joint tenancy with her husband, David G. Brown, who shares voting
and dispositive power over such shares.
<PAGE>
1. Name of Reporting Person:
Mark A. Wolfson
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: PF
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: USA
7. Sole Voting Power: -0-
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: -0-
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
-0-
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 0.0%
14. Type of Reporting Person: IN
<PAGE>
Pursuant to Regulation 13D-G of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended (the "Act"), the undersigned hereby
amend their Schedule 13D Statement dated May 30, 1996, (the "Schedule 13D"),
relating to the Common Stock (the "Stock"), of AER Energy Resources, Inc. (the
"Issuer"). Unless otherwise indicated, all defined terms used herein shall have
the same meanings respectively ascribed to them in the Schedule 13D.
Item 1. Security and Issuer.
No material change.
Item 2. Identity and Background.
Paragraph (a) of Item 2 hereby is partially amended by adding at the
end thereof the following:
FW AER II, L.P., a Delaware limited partnership ("FW II"), and Group III
31, L.L.C., a Delaware limited liability company ("Group III"), hereby join this
filing because they may be deemed to constitute a "group" with the Reporting
Persons within the meaning of Section 13(d)(3) of the Act, although neither the
fact of this filing nor anything contained herein shall be deemed to be an
admission by FW II or Group III or the other Reporting Persons that a group
exists. As used hereinafter, the term "Reporting Persons" shall also include
reference to FW II and Group III.
For purposes of future filings, Wolfson shall no longer be a Reporting
Person.
Paragraphs (b) - (c) of Item 2 hereby are partially amended by adding at
the end thereof the following:
FW II
FW II is a Delaware limited partnership, the principal business of which is
the purchase, sale, exchange, acquisition and holding of investment securities.
The principal business address of FW II, which also serves as its principal
office, is 201 Main Street, Suite 3100, Fort Worth, Texas 76102. Pursuant to
Instruction C to Schedule 13D of the Act, information with respect to Group III,
the sole general partner of FW II, is set forth below.
Group III
Group III is a Delaware limited liability company, the principal business
of which is serving as the general partner of various investment partnerships.
The principal address of Group III, which also serves as its principal office,
is 201 Main Street, Suite 3100, Fort Worth, Texas 76102. Pursuant to
Instruction C to Schedule 13D of the Act, the name, residence or business
address, and present principal occupation or employment of each director,
executive officer and controlling person of Group III is as follows:
RESIDENCE OR PRINCIPAL OCCUPATION
NAME BUSINESS ADDRESS OR EMPLOYMENT
J. Crandall 2775 Sand Hill Road Vice President and
Suite 220 Chief Operating Officer
Menlo Park, California of Keystone and
94025 Managing Director of
Oak Hill Capital
Management, Inc.
W. Robert Cotham 201 Main St., Ste. 2600 Vice President/
Fort Worth, TX 76102 Controller of BEPCO
Thomas R. Delatour, 201 Main Street, Ste. 3100 Vice President of
Jr. Fort Worth, Texas 76102 Group
Mark A. Wolfson 2775 Sand Hill Road Managing Director of
Suite 220 Oak Hill Capital
Menlo Park, California Management, Inc.
94025
James N. Alexander 2460 Sand Hill Road Managing Director of
Suite 300 Oak Hill Capital
Menlo Park, California Management, Inc.
94025
D. Brown 2460 Sand Hill Road Managing Partner of
Suite 300 Oak Hill Venture
Menlo Park, California Partners, L.P.
94025
Gary W. Reese 201 Main St., Ste. 2600 Treasurer of BEPCO
Fort Worth, TX 76102
Oak Hill Capital Management, Inc. is a Delaware corporation, the principal
business of which is serving as an investment consultant to Oak Hill Capital
Partners, L.P. ("Oak Hill"). Oak Hill is a Delaware limited partnership, formed
to make control investments in operating companies through acquisitions, build-
ups, recapitalizations, restructurings or significant minority stakes. The
principal business address of Oak Hill Capital Management, Inc. is 65 E. 55th
Street, New York, NY 10022.
Oak Hill Venture Partners, L.P. is a Delaware limited partnership, the
principal business of which is the purchase, sale, exchange, acquisition and
holding of investment securities. The principal business address of Oak Hill
Venture Partners is 2460 Sand Hill Road, Suite 300, Menlo Park, California
94025.
(d) - (f)
No material change.
Item 3. Source and Amount of Funds or Other Consideration.
Item 3 is hereby amended and restated in its entirety as follows:
The source and amount of the funds used or to be used by the Reporting
Persons to purchase shares of the Stock are as follows:
REPORTING PERSON SOURCE OF FUNDS AMOUNT OF FUNDS
Keystone Working Capital(1) $2,361,924.65
R. Bass Not Applicable Not Applicable
FW Partners Other - Contributions $10,000,000.00 (2)
from Partners
Group Not Applicable Not Applicable
J. Crandall Not Applicable Not Applicable
FW II Other - Contributions $1,000,000.00 (3)
from Partners
D. Brown/
M. Brown Personal Funds (4) $146,950.00
Wolfson Not Applicable Not Applicable
(1) As used herein, the term "Working Capital" includes income from the
business operations of the entity plus sums borrowed from banks and brokerage
firm margin accounts to operate such business in general. None of the funds
reported herein as "Working Capital" were borrowed or otherwise obtained for the
specific purpose of acquiring, handling, trading or voting the Stock.
(2) This figure represents the total amount expended in purchasing the
Stock and the Warrant.
(3) This figure represents the total amount expended by FW II in
purchasing the convertible promissory note and the warrant described in Item 6.
(4) As used herein, the term "Personal Funds" may include sums borrowed
from banks and brokerage firm margin accounts, none of which were borrowed or
otherwise obtained for the specific purpose of acquiring, handling, trading or
voting the Stock.
Item 4. Purpose of Transaction.
No material change.
Item 5. Interest in Securities of the Issuer.
Item 5 is hereby amended and restated in its entirety as follows:
(a)
Keystone
The aggregate number of shares of the Stock that Keystone owns
beneficially, pursuant to Rule 13d-3 of the Act, is 1,000,000, which
constitutes approximately 4.0% of the outstanding shares of the Stock.
R. Bass
Because of his position as the President and sole director of Keystone,
R. Bass may, pursuant to Rule 13d-3 of the Act, be deemed to be the beneficial
owner of 1,000,000 shares of the Stock, which constitutes approximately 4.0% of
the outstanding shares of the Stock.
FW Partners
The aggregate number of shares of the Stock that FW Partners owns
beneficially, pursuant to Rule 13d-3 of the Act, is 2,419,158, which constitutes
approximately 9.4% of the 25,685,263 shares of the Stock deemed outstanding
pursuant to Rule 13d-3(d)(1)(i).
Group
Because of its position as the sole general partner of FW Partners,
Group may, pursuant to Rule 13d-3 of the Act, be deemed to be the beneficial
owner of 2,419,158 shares of the Stock, which constitutes approximately 9.4% of
the 25,685,263 shares of the Stock deemed outstanding pursuant to Rule 13d-
3(d)(1)(i).
J. Crandall
Because of his position as the President of Group, which is the sole
general partner of FW Partners, and because of his position as President of
Group III, which is the sole general partner of FW II, J. Crandall may, pursuant
to Rule 13d-3 of the Act, be deemed to be the beneficial owner of 2,532,152
shares of the Stock, which constitutes approximately 9.8% of the 25,798,257
shares of the Stock deemed outstanding pursuant to Rule 13d-3(d)(1)(i).
FW II
The aggregate number of shares of the Stock that FW II owns
beneficially, pursuant to Rule 13d-3 of the Act, is 112,994, which constitutes
approximately 0.5% of the 24,963,257 shares of the Stock deemed outstanding
pursuant to Rule 13d-3(d)(1)(i).
Group III
Because of its position as the sole general partner of FW II, Group III
may, pursuant to Rule 13d-3 of the Act, be deemed to be the beneficial owner of
112,994 shares of the Stock, which constitutes approximately 0.5% of the
24,963,257 shares of the Stock deemed outstanding pursuant to Rule 13d-
3(d)(1)(i).
D. Brown
The aggregate number of shares of the Stock that D. Brown owns
beneficially as a joint tenant with M. Brown, pursuant to Rule 13d-3 of the Act,
is 86,250, which constitutes approximately 0.3% of the outstanding shares of the
Stock.
M. Brown
The aggregate number of shares of the Stock that M. Brown owns
beneficially as a joint tenant with D. Brown, pursuant to Rule 13d-3 of the Act,
is 86,250, which constitutes approximately 0.3% of the outstanding shares of the
Stock.
Wolfson
Wolfson is not the beneficial owner of any shares of the Stock.
(b)
Keystone
Acting through its President and sole director, Keystone has the sole
power to vote or to direct the vote and to dispose or to direct the disposition
of 1,000,000 shares of the Stock.
R. Bass
As the President and sole director of Keystone, R. Bass has the sole
power to vote or to direct the vote and to dispose or direct the disposition of
1,000,000 shares of the Stock.
FW Partners
Acting through its sole general partner, FW Partners has the sole power
to vote or to direct the vote and to dispose or to direct the disposition of
1,584,158 shares of the Stock.
Group
Acting through its President, and in its capacity as the sole general
partner of FW Partners, Group has the sole power to vote or to direct the vote
and to dispose or to direct the disposition of 1,584,158 shares of the Stock.
J. Crandall
In his capacity as the President of Group, which is the sole general
partner of FW Partners, J. Crandall has the sole power to vote or to direct the
vote and to dispose or to direct the disposition of 1,584,158 shares of the
Stock.
FW II
FW II has no power to vote or to direct the vote or to dispose or to
direct the disposition of any shares of the Stock.
Group III
In its capacity as the sole general partner of FW II, Group III has no
power to vote or to direct the vote or to dispose or to direct the disposition
of any shares of the Stock.
D. Brown
As joint tenant with M. Brown, D. Brown has the shared power to vote or
to direct the vote and to dispose or to direct the disposition of 86,250 shares
of the Stock.
M. Brown
As joint tenant with D. Brown, M. Brown has the shared power to vote or
to direct the vote and to dispose or to direct the disposition of 86,250 shares
of the Stock.
Wolfson
Wolfson has no power to vote or to direct the vote or to dispose or to
direct the disposition of any shares of the Stock.
(c) On April 3, 2000, FW II acquired from the Issuer a Convertible
Promissory Note in the principal amount of $1,000,000 (the "Convertible Note")
and a warrant to purchase 112,994 shares of the Stock (the "FW II Warrant"). The
aggregate purchase price of the Convertible Note and the FW II Warrant was
$1,000,000.
Other than as set forth above, none of the Reporting Persons have
purchased or sold any shares of the Stock in the previous 60 days.
(d) Each of the Reporting Persons affirms that no person other than
such Reporting Person has the right to receive or the power to direct the
receipt of dividends from, or the proceeds from the sale of, the shares of the
Stock owned by such Reporting Person.
(e) Not Applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
Item 6 is amended by adding at the end thereof the following:
As described under Item 5(c) above, on April 3, 2000 FW II acquired from
the Issuer the Convertible Note and the FW II Warrant. On November 6, 1997, FW
Partners and the Issuer entered into a letter agreement (the "Letter Agreement")
that amended the registration rights provisions of the Purchase Agreement
pursuant to which FW Partners acquired shares of the Stock and warrants from the
Issuer in May, 1996, as described in the Schedule 13D. The description of the
Convertible Note, the FW II Warrant and the Letter Agreement that follows is
not, and does not purport to be, complete and is qualified in its entirety by
reference to the Convertible Note, the FW II Warrant and the Letter Agreement,
as applicable, the forms of which are attached hereto as Exhibits 99.4, 99.5,
and 99.6, respectively.
Convertible Note
The Convertible Note provides for interest on the unpaid principal amount
thereof at a rate equal to the prime rate announced from time to time by Bank of
America, Atlanta, Georgia, plus 4%. Interest is payable quarterly in arrears
and the principal is payable in full on March 30, 2002 (the "Maturity Date").
If on or prior to the Maturity Date the Issuer completes a public or private
issuance of the Issuer's equity securities, FW II shall have the right to
convert the outstanding principal amount of the Convertible Note, in whole or in
part, into shares of the equity securities of the Issuer issued in such
offering. The number of shares issuable upon any such conversion will be
determined by dividing the outstanding principal amount of the Convertible Note
submitted for conversion by the lowest price per share of the class or series of
equity securities being issued, as described in Section 5.1 of the Convertible
Note.
FW II Warrant
The FW II Warrant is exercisable at any time, in whole or in part, prior to
March 30, 2005, into 112,994 shares of the Stock at a price of $1.77 per share,
subject to adjustment as described therein.
Letter Agreement
The Letter Agreement amended the Purchase Agreement to provide Keystone, D.
Brown, Wolfson and "affiliates" or "associates" thereof, as such terms are
defined in the Securities Act of 1933, as amended, with certain demand and
"piggyback" registration rights through May 20, 2001.
Except as set forth herein or in the Exhibits filed herewith, there are
no contracts, arrangements, understandings or relationships with respect to
shares of the Stock owned by the Reporting Persons.
Item 7. Material to be Filed as Exhibits.
Item 7 is hereby amended and restated in its entirety as follows:
Exhibit 99.1 -- Agreement pursuant to Rule 13d-1(k)(1)(iii), filed
herewith.
Exhibit 99.2 -- AER Energy Resources, Inc. Securities Purchase Agreement
dated as of May 13, 1996 between the Issuer and FW Partners, L.P.
previously filed.
Exhibit 99.3 -- Warrant to purchase 835,000 shares of Common Stock dated
as of May 20, 1996 and issued in the name of FW AER Partners, L.P.,
previously filed.
Exhibit 99.4 -- Convertible Promissory Note in the amount of $1,000,000,
dated April 3, 2000 between the Issuer and FW AER II, L.P., filed
herewith.
Exhibit 99.5 -- Warrant to purchase 112,994 shares of Common Stock dated
as of April 3, 2000 between the Issuer and FW AER II, L.P., filed
herewith.
Exhibit 99.6 -- Letter Agreement Amending Stock Purchase Agreement
between the Issuer and FW Partners, L.P. filed herewith.
<PAGE>
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
DATED: April 11, 2000
KEYSTONE, INC.
By: /s/ W. R. Cotham
W. R. Cotham,
Vice President
/s/ W. R. Cotham
W. R. COTHAM
Attorney-in-Fact for:
ROBERT M. BASS (1)
FW AER PARTNERS, L.P.
By: Group 31, Inc.,
General Partner
By: /s/ J. Taylor Crandall
J. Taylor Crandall,
President
GROUP 31, INC.
By: /s/ J. Taylor Crandall
J. Taylor Crandall,
President
/s/ J. Taylor Crandall
J. TAYLOR CRANDALL
FW AER II, L.P.
By: Group III 31, L.L.C.,
General Partner
By: /s/ J. Taylor Crandall
J. Taylor Crandall,
President
GROUP III 31, L.L.C.
By: /s/ J. Taylor Crandall
J. Taylor Crandall,
President
/s/ David G. Brown
DAVID G. BROWN
/s/ Maureen Brown
MAUREEN BROWN
(1) A Power of Attorney authorizing W. R. Cotham, et al., to act on behalf
of Robert M. Bass previously has been filed with the Securities and
Exchange Commission.
Exhibit 99.1
Pursuant to Rule 13d-1(k)(1)(iii) of Regulation 13D-G of the General
Rules and Regulations of the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended, the undersigned agrees that the
statement to which this Exhibit is attached is filed on behalf of each of them
in the capacities set forth below.
KEYSTONE, INC.
By: /s/ W. R. Cotham
W. R. Cotham,
Vice President
/s/ W. R. Cotham
W. R. COTHAM
Attorney-in-Fact for:
ROBERT M. BASS (1)
FW AER PARTNERS, L.P.
By: Group 31, Inc.,
General Partner
By: /s/ J. Taylor Crandall
J. Taylor Crandall,
President
GROUP 31, INC.
By: /s/ J. Taylor Crandall
J. Taylor Crandall,
President
/s/ J. Taylor Crandall
J. TAYLOR CRANDALL
FW AER II, L.P.
By: Group III 31, L.L.C.,
General Partner
By: /s/ J. Taylor Crandall
J. Taylor Crandall,
President
GROUP III 31, L.L.C.
By: /s/ J. Taylor Crandall
J. Taylor Crandall,
President
/s/ David G. Brown
DAVID G. BROWN
/s/ Maureen Brown
MAUREEN BROWN
(1) A Power of Attorney authorizing W. R. Cotham, et al., to act on behalf
of Robert M. Bass previously has been filed with the Securities and
Exchange Commission.
Exhibit 99.4
CONVERTIBLE PROMISSORY NOTE
NEITHER THIS NOTE NOR ANY STOCK ISSUED UPON CONVERSION HEREOF HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR ANY
APPLICABLE STATE SECURITIES OR BLUE SKY LAWS (THE "STATE LAWS"), AND MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF REGISTRATION UNDER THE ACT AND STATE LAWS
OR AN EXEMPTION FROM REGISTRATION THEREUNDER.
CONVERTIBLE PROMISSORY NOTE
April 3, 2000 $1,000,000
AER ENERGY RESOURCES, INC., a Georgia corporation (the "Company"),
hereby promises to pay to the order of FW AER II, L.P., a Delaware limited
partnership (together with any subsequent holder of this Note, the "Holder"),
the principal amount of ONE MILLION AND NO/100 DOLLARS ($1,000,000.00), together
with interest thereon calculated from the date hereof in accordance with the
provisions of this Note. Capitalized terms used herein and not otherwise
defined shall have the meanings assigned to them in Section 7.
1. Payment of Interest.
1.1 Computation and Payment of Interest. Interest on the unpaid
principal amount of this Note outstanding from time to time shall accrue on a
daily basis at a rate per annum equal to the Prime Rate (as defined below) plus
four percent (4.0%) and shall be computed on the basis of a three hundred sixty
(360) day year for the actual number of days elapsed in the period during which
it accrues. On and after the occurrence and during the continuance of an Event
of Default, at the option of the Holder, interest on the unpaid principal amount
of this Note outstanding from time to time shall accrue on a daily basis at a
rate per annum equal to the Prime Rate plus six percent (6.0%) (the "Default
Rate").
Accrued interest shall be due and payable quarterly in arrears on the
first day of January, April, July and October of each year, commencing July 1,
2000. Accrued interest also shall be due and payable on the date of any
voluntary or mandatory prepayment of this Note, at maturity, whether by
acceleration or otherwise, and on the date of any conversion of this Note
pursuant to Section 5. Interest payable after maturity of this Note (by
acceleration or otherwise) shall be payable upon demand.
As used herein, "Prime Rate" means the rate of interest publicly
announced from time to time by Bank of America, Atlanta, Georgia, as its "Prime
Rate" or "Base Rate" for commercial loans made by such bank. The interest rate
hereunder shall be adjusted on the effective date of any change in the Prime
Rate to reflect the Prime Rate then in effect. In the event that such bank
ceases to publish a "Prime Rate" or "Base Rate" for its commercial loans, the
Holder may specify an alternate source for the Prime Rate by delivering written
notice thereof to the Company.
1.2 Interest Laws. Notwithstanding any provision to the contrary
contained in this Note, the Company shall not be required to pay, and the Holder
shall not be permitted to collect, any amount of interest in excess of the
maximum amount of interest permitted by law ("Excess Interest"). If any Excess
Interest is provided for or determined by a court of competent jurisdiction to
have been provided for in this Note, then in such event: (a) the provisions of
this Section 1.2 shall govern and control; (b) the Company shall not be
obligated to pay any Excess Interest; (c) any Excess Interest that the Holder
may have received hereunder shall be, at the Holder's option, (i) applied as a
credit against the outstanding principal balance of this Note or accrued and
unpaid interest (not to exceed the maximum amount permitted by law), (ii)
refunded to the Company, or (iii) any combination of the foregoing; (d) the
interest rate provided for herein shall be automatically reduced to the maximum
lawful rate allowed from time to time under applicable law (the "Maximum Rate"),
and this Note shall be deemed to have been and shall be, reformed and modified
to reflect such reduction; and (e) the Company shall not have any action against
the Holder for any damages arising out of the payment or collection of any
Excess Interest. Notwithstanding the foregoing, if for any period of time
interest on this Note is calculated at the Maximum Rate rather than the
applicable rate under this Note, and thereafter such applicable rate becomes
less than the Maximum Rate, the rate of interest payable on this Note shall
remain at the Maximum Rate until the Holder shall have received the amount of
interest which the Holder would have received during such period on this Note
had the rate of interest not been limited to the Maximum Rate during such
period.
2. Payment of Principal.
2.1 Scheduled Payment. The Company shall pay in full the outstanding
principal amount of this Note to the Holder on March 30, 2002 (the "Maturity
Date").
2.2 Voluntary Prepayments. The Company may prepay the principal
amount of this Note in whole only upon not less than ten (10) days' prior
written notice to the Holder; provided, however, that the Company may not prepay
this Note after the date that the Company receives a notice of conversion of
this Note pursuant to Section 5 notwithstanding that the Company may have
previously delivered a notice of prepayment to the Holder, and upon delivery of
any such notice of conversion, all outstanding notices of prepayment (regardless
of when delivered) shall be deemed automatically rescinded. The Company may not
prepay the principal amount of this Note in part.
2.3 Mandatory Prepayment. Upon the closing of any Equity Issuance,
the Holder may require the Company to apply all or any portion of the Net
Proceeds of such Equity Issuance in prepayment of the outstanding principal
amount of this Note (or portion thereof); provided, however, in the event that
the holder of the Other Note requires the Company to apply all of any portion of
such Net Proceeds in prepayment of the Other Note and the amount of such Net
Proceeds is less than the aggregate principal of this Note and the Other Note to
be prepaid, then such Net Proceeds shall be applied pro rata in prepayment of
this Note and the Other Note based on the relative amounts of principal as to
which the Holder and the holder of the Other Note require prepayment in
connection with such Equity Issuance.
3. Manner and Time of Payment.
3.1 Payment in Same Day Funds. All payments by the Company with
respect to this Note shall be made without deduction, defense, setoff or
counterclaim and in same day funds and delivered to the Holder by wire transfer
to such account as the Holder may designate from time to time. The Company
shall receive credit for such funds on the date received if such funds are
received by the Holder by 2:00 p.m. (Atlanta, Georgia time) on such day. In the
absence of timely receipt, such funds shall be deemed to have been paid by the
Company on the next succeeding Business Day.
3.2 Payment on Non-Business Days. If any payment on this Note shall
become due on a day that is not a Business Day, such payment shall be made on
the next succeeding Business Day and such extension of time shall in such case
be included in computing any interest due in connection with such payment.
4. Events of Default.
4.1 Definition. For purposes of this Note, an "Event of Default"
shall be deemed to have occurred:
(a) if the Company fails to pay any interest then accrued and payable
with respect to this Note (and such failure continues for a period of five
(5) days after notice thereof to the Company);
(b) if the Company fails to pay any principal on this Note when due
(and such failure continues for a period of five (5) days after notice
thereof to the Company);
(c) if the Company breaches or otherwise fails to perform or observe
any covenant or agreement contained in this Note and such failure to
perform or observe is not cured within ten (10) days after the Company
receives notice of the occurrence thereof;
(d) if the Company makes an assignment for the benefit of creditors
or admits in writing its inability to pay its debts generally as they
become due; or an order, judgment or decree is entered adjudicating the
Company bankrupt or insolvent; or any order for relief with respect to the
Company is entered under the United States Bankruptcy Code; or the Company
petitions or applies to any tribunal for the appointment of a custodian,
trustee, receiver or liquidator of the Company, or of any substantial part
of the assets of the Company, or commences any proceeding relating to the
Company under any bankruptcy reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation law of any jurisdiction;
or any such petition or application is filed, or any such proceeding is
commenced, against the Company and either (i) the Company by any act
indicates its approval thereof, consents thereto or acquiesces therein or
(ii) such petition, application or proceeding is not dismissed within sixty
(60) days;
(e) if any money judgment, writ or warrant of attachment, or similar
process is entered or filed against the Company or any of its assets, and
remains undischarged, unvacated, unbonded and unstayed for a period of
thirty (30) days; or
(f) if any order, judgment or decree is entered against the Company
decreeing the dissolution or split up of the Company and such order remains
undischarged or unstayed for a period in excess of twenty (20) days.
4.2 Consequences of Event of Default.
(a) If an Event of Default of the type described in Section 4.1(d)
has occurred, the entire outstanding principal amount of this Note, plus all
accrued interest thereon, shall automatically become immediately due and
payable, without any demand or other action on the part of the Holder.
(b) If any Event of Default other than of the type described in
Section 4.1(d) has occurred, the Holder may declare (by written notice delivered
to the Company) all or any portion of the outstanding principal amount of this
Note, plus all accrued interest thereon, due and payable and demand immediate
payment of all or any portion of the outstanding principal amount of this Note,
plus all accrued interest thereon. The Holder shall also have any other rights
which the Holder may have been afforded under any contract or agreement at any
time and any other rights which the Holder may have pursuant to applicable law.
5. Conversion.
5.1 Conversion Option. If on or prior to the Maturity Date, the
Company consummates an Equity Issuance, then, provided that the Holder is at
that time an "accredited investor" as defined in Regulation D promulgated under
the Act, the Holder shall have the right, on the effective date of such Equity
Issuance, to convert the outstanding principal amount of this Note, in whole or
in part, to shares of the equity securities issued by the Company in such Equity
Issuance. If more than one class or series of shares of equity securities are
issued in such Equity Issuance, then the Holder may elect to receive in such
conversion any one or more of such classes or series of securities. Upon any
such conversion, the Company shall issue to the Holder the number of shares of
each class or series of such equity securities that the Holder elects to
receive, as determined in accordance with the following formula:
N = O
P
where:
N = the number of shares of such class or series of equity securities
to be issued to the Holder upon such conversion
O = the outstanding principal amount of this Note to be converted
into such class or series
P = the lowest price per share of such class or series of equity
securities issued to any Person other than the Holder in connection
with such Equity Issuance
5.2 Manner of Conversion. The Holder may exercise the right to
convert this Note pursuant to Section 5.1 by delivering written notice of such
exercise to the Company, which notice shall specify the portion of the principal
balance of this Note as to which the Holder elects such conversion and the
class(es) or series of securities to be received upon such conversion. Such
notice may be delivered to the Company at any time prior to the closing of the
Equity Issuance. In the event that the Holder exercises such conversion option,
then at the closing of the Equity Issuance, the Company shall deliver to the
Holder or to such other Person as the Holder shall designate in its notice of
conversion one or more certificates evidencing the shares of equity securities
into which this Note (or portion) is converted, which certificate(s) shall be in
the name of the Holder or such other Person as the Holder shall designate in its
notice of exercise and, in the case of a partial conversion, a new note in the
amount of the unconverted principal balance hereof. In exchange for such
certificate(s) and any such new note, the Holder shall deliver to the Company
the original of this Note. On the date of any such conversion, the Company
shall pay to the Holder in cash, all accrued but unpaid interest on the portion
of the principal amount of this Note that is so converted.
5.3 Notice of Equity Issuance. Not less than ten (10) days prior to
the expected closing date of any Equity Issuance, the Company shall deliver to
the Holder written notice of such Equity Issuance, which notice shall set forth
the material terms of such Equity Issuance and the expected closing date
thereof.
6. Miscellaneous Provisions.
6.1 Waiver of Demand and Notice. The Company hereby waives demand,
notice, protest and all other demands and notices in connection with the
delivery, acceptance, performance, default or enforcement of this Note.
6.2 Governing Law. This Note shall be construed and enforced in
accordance with, and all questions concerning the construction, validity,
interpretation and performance of this Note shall be governed by, the laws of
the State of Georgia, without giving effect to provisions thereof regarding
conflict of laws.
6.3 Consent to Jurisdiction and Service of Process. The Company and,
by its acceptance hereof, the Holder hereby consent to the jurisdiction of any
state or federal court located in Atlanta, Georgia and irrevocably agree that
subject to the Holder's election, all actions or proceedings arising out of or
relating to this Note shall be litigated in such courts. The Company accepts
for itself and in connection with its properties, generally and unconditionally,
the nonexclusive jurisdiction of the aforesaid courts and waives any defense of
forum non conveniens, and irrevocably agrees to be bound by any judgment
rendered thereby in connection with this Note.
6.4 Expenses and Attorneys' Fees. The Company shall promptly
reimburse the Holder for all fees, costs and expenses (including reasonable
attorneys' fees) incurred by the Holder in any action to enforce this Note or to
collect any payments due from the Company under this Note.
6.5 Notices. Unless otherwise specifically provided herein, any
notice or other communication required or permitted to be given shall be in
writing addressed to the respective party as set forth below and may be
personally served, sent by facsimile, telex or overnight courier service or
United States mail and shall be deemed to have been given: (a) if delivered in
person, when delivered; (b) if delivered by telecopy or telex, on the date of
transmission if transmitted on a Business Day before 4:00 p.m. (Atlanta, Georgia
time) or, if not, on the next succeeding Business Day; (c) if delivered by
overnight courier, one (1) Business Day after delivery to such courier properly
addressed; or (d) if by U.S. Mail, four (4) Business Days after depositing in
the United States mail, with postage prepaid and properly addressed.
Notices shall be addressed as follows:
If to the Company: AER Energy Resources, Inc.
4600 Highlands Parkway
Suite G
Smyrna, Georgia 30082
Attention: President
Facsimile No.: 770 433-2286
If to the Holder: FW AER II, L.P.
201 Main Street
Suite 2600
Ft. Worth, Texas 76102
Attention: Vice President and Controller
Facsimile No.: 817 338-2067
with a copy to: David G. Brown
c/o Arbor Investors
2775 Sand Hill Road
Suite 220
Menlo Park, California 94025
Facsimile No.: 650 234-0525
or to such other address as the party addressed shall have previously designated
by written notice to the serving party, given in accordance with this Section
6.5. A notice not given as provided above shall, if it is in writing, be deemed
given if and when actually received by the party to whom given.
6.6 Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of the Holder in the exercise of any power, right
or privilege hereunder shall impair such power, right or privilege or be
construed to be a waiver of any default or acquiescence therein, nor shall any
single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege. All
rights and remedies existing under this Note are cumulative to, and not
exclusive of, any rights or remedies otherwise available.
6.7 Severability. The invalidity, illegality or unenforceability in
any jurisdiction of any provision in or obligation under this Note shall not
affect or impair the validity, legality or enforceability of the remaining
provisions or obligations under this Note or of such provision or obligation in
any other jurisdiction.
6.8 Headings. Section and subsection headings in this Note are
included herein for convenience of reference only and shall not constitute a
part of this Note for any other purpose or be given any substantive effect.
6.9 Assignments and Participations. Subject to the requirements of
the Act and the State Laws, the Holder may assign its rights under this Note and
further may assign, or sell participations in, all or any part of this Note to
any other Person or Persons. Prior to the effective date of any assignment of
this Note, the Holder shall deliver to the Company written notice of such
assignment, which notice shall specify the identity of the assignee.
7. Definitions. The following terms used in this Note shall have
the following meanings:
"Business Day" means a day other than Saturday, Sunday or a bank or
legal holiday under the laws of the State of Georgia.
"Conversion Option" means the option of the Holder, pursuant to
Section 5, to convert all or a portion of the unpaid principal and interest
hereunder into equity securities of the Company.
"Equity Issuance" means the public or private issuance by the Company
of equity securities in the Company to any Person.
"Event of Default" means each of the events set forth in Section 4.1.
"Net Proceeds" means, with respect to any Equity Issuance, the sale
proceeds received by the Company in such Equity Issuance, net of
underwriting fees, commissions and discounts.
"Other Note" means the Convertible Promissory Note of even date
herewith, in the principal amount of $1,000,000, made and executed by the
Company in favor of The Kindt-Collins Company, as such Note may be replaced
or exchanged from time to time.
"Person" means and includes natural persons, corporations, limited
partnerships, general partnerships, limited liability companies, joint
ventures, associations, trusts, business trusts or other organizations,
whether or not legal entities, and governments and agencies and political
subdivisions thereof.
[Signature appears on following page]
IN WITNESS WHEREOF, the Company has executed and delivered this Note
as of the date first written above.
AER ENERGY RESOURCES, INC.
By:
Name:
Title:
THIS WARRANT AND THE SECURITIES PURCHASED ON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNTIL EITHER (i) A REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) THE CORPORATION SHALL HAVE RECEIVED AN
OPINION OF COUNSEL ACCEPTABLE TO THE CORPORATION AND ITS COUNSEL THAT AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OR APPLICABLE STATE
SECURITIES LAWS IS AVAILABLE IN CONNECTION THEREWITH.
Warrant to Purchase
112,994 shares
Warrant to Purchase Common Stock
of
AER ENERGY RESOURCES, INC.
THIS CERTIFIES that FW AER II, L.P., a Delaware limited partnership
("Holder") or any subsequent holder hereof, has the right to purchase from AER
Energy Resources, Inc., a Georgia corporation (the "Company"), up to 112,994
fully paid and nonassessable shares of the Companys Common Stock, no par value
("Common Stock"), at a price of $1.77 per share subject to adjustment as
provided below (the "Exercise Price"), at any time on or before 5:00 p.m.,
Atlanta, Georgia time, on March 30, 2005.
This Warrant is issued and all rights hereunder shall be held subject to
all of the conditions, limitations and provisions set forth herein.
1. Exercise.
This Warrant may be exercised as to all or any lesser number of full shares
of Common Stock covered hereby upon surrender of this Warrant, with the
Subscription Form attached hereto duly executed, together with the full Exercise
Price in cash, or by certified or official bank check payable in New York
Clearing House Funds for each share of Common Stock as to which this Warrant is
exercised, at the office of the Company, AER Energy Resources, Inc., 4600
Highlands Parkway, Suite G, Smyrna, GA 30082, or at such other office or agency
as the Company may designate in writing (such surrender and payment hereinafter
called the "Exercise of this Warrant"). The "Date of Exercise" of the Warrant
shall be defined as the date that the original Warrant and Subscription Form are
received by the Company. This Warrant shall be canceled upon its Exercise, and,
as soon as practicable thereafter, the Holder hereof shall be entitled to
receive a certificate or certificates for the number of shares of Common Stock
purchased upon such Exercise and a new Warrant or Warrants (containing terms
identical to this Warrant) representing any unexercised portion of this Warrant.
Each person in whose name any certificate for shares of Common Stock is issued
shall, for all purposes, be deemed to have become the Holder of record of such
shares on the Date of Exercise of this Warrant, irrespective of the date of
delivery of such certificate. Nothing in this Warrant shall be construed as
conferring upon the Holder hereof any rights as a shareholder of the Company.
2. Payment of Warrant Exercise Price.
Payment of the Exercise Price may be made by any of the following, or a
combination thereof, at the election of Holder:
(i) cash, certified check or cashiers check or wire transfer; or
(ii) surrender of this Warrant at the principal office of the Company
together with notice of election, in which event the Company shall issue Holder
a number of shares of Common Stock computed using the following formula:
X = Y (A-B)/A
where: X = the number of shares of Common Stock to be issued to Holder
(not to exceed the number of shares set forth on the cover page of
this Warrant, as adjusted pursuant to the provisions of Section 4 of
this Warrant).
Y = the number of shares of Common Stock for which this Warrant is
being exercised.
A = the Market Price of one share of Common Stock (for purposes of
this Section 2(ii), the "Market Price" shall be defined as the average
closing bid price of the Common Stock for the five trading days prior
to the Date of Exercise of this Warrant (the "Average Closing Bid
Price"), as reported on the Nasdaq National Market, or if the Common
Stock is not traded on the Nasdaq National Market, the Average Closing
Bid Price in the over-the-counter market; provided, however, that if
the Common Stock is listed on a stock exchange, the Market Price shall
be the Average Closing Bid Price on such exchange).
B = the Exercise Price.
It is intended that the Common stock issuable upon exercise of this Warrant in a
cashless exercise transaction shall be deemed to have been acquired at the time
this Warrant was issued, for purposes of Rule 144(d)(3)(ii).
3. Transfer and Registration.
Subject to the provisions of Section 7 of this Warrant, this Warrant may be
transferred on the books of the Company, wholly or in part, in person or by
attorney, upon surrender of this Warrant properly endorsed, with signature
guaranteed. This Warrant shall be canceled upon such surrender and, as soon as
practicable thereafter, the person to whom such transfer is made shall be
entitled to receive a new Warrant or Warrants as to the portion of this Warrant
transferred, and the Holder of this Warrant shall be entitled to receive a new
Warrant or Warrants as to the portion hereof retained.
4. Anti-Dilution Adjustments.
(a) If the Company shall at any time declare a dividend payable in shares
of Common Stock, then the Holder hereof, upon Exercise of this Warrant after the
record date for the determination of Holders of Common Stock entitled to receive
such dividend, shall be entitled to receive upon Exercise of this Warrant, in
addition to the number of shares of Common Stock as to which this Warrant is
Exercised, such additional shares of Common stock as such Holder would have
received had this Warrant been Exercised immediately prior to such record date.
(b) If the Company shall at any time effect a recapitalization or
reclassification of such character that the shares of Common stock shall be
changed into or become exchangeable for a larger or smaller number of shares,
then upon the effective date thereof, the number of shares of Common Stock which
the Holder hereof shall be entitled to purchase upon Exercise of this Warrant
shall be increased or decreased, as the case may be, in direct proportion to the
increase or decrease in the number of shares of Common Stock by reason of such
recapitalization or reclassification, and the Exercise Price shall be, in the
case of an increase in the number of shares, proportionately decreased and, in
the case of a decrease in the number of shares, proportionally increased.
(c) If the Company shall at any time distribute to Holders of Common Stock
cash, evidences of indebtedness or other securities or assets (other than cash
dividends or distributions payable out of earned surplus or net profits for the
current or preceding year) then, in any such case, the Holder of this Warrant
shall be entitled to receive, upon Exercise of this Warrant, with respect to
each share of Common Stock issuable upon such Exercise, the amount of cash or
evidences of indebtedness or other securities or assets which such Holder would
have been entitled to receive with respect to each such share of Common stock as
a result of the happening of such event had this Warrant been Exercised
immediately prior to the record date or other date fixing shareholders to be
affected by such event (the "Determination Date") or, in lieu thereof, if the
Board of Directors of the Company should so determine at the time of such
distribution, a reduced Exercise Price determined by multiplying the Exercise
Price on the Determination Date by a fraction, the numerator of which is the
result of such Exercise Price reduced by the value of such distribution
applicable to one share of Common stock (such value to be determined by the
Board in its discretion) and the denominator of which is such Exercise Price.
(d) If the Company shall at any time consolidate or merge with any other
corporation or transfer all or substantially all of its assets or dissolve, then
the Company shall deliver written notice to the Holder of such merger,
consolidation or sale of assets or dissolution at least thirty (30) days prior
to the closing of such merger, consolidation or sale of assets or dissolution,
and this Warrant shall terminate and expire immediately prior to the closing of
such merger, consolidation or sale of assets or dissolution.
(e) As used in this Warrant, the term "Exercise Price" shall mean the
purchase price per share specified in this Warrant until the occurrence of an
event stated in Section 4 (b) or (c) and thereafter shall mean said price as
adjusted from time to time in accordance with the provisions of said sections.
No such adjustment shall be made unless such adjustment would change the
Exercise Price at the time by $.01 or more; provided, however, that all
adjustments not so made shall be deferred and made when the aggregate thereof
would change the Exercise Price at the time by $.01 or more. No adjustment made
pursuant to any provision of this Section 4 shall have the effect of increasing
the total consideration payable upon Exercise of this Warrant in respect of all
the Common Stock as to which this Warrant may be exercised.
(f) In the event that at any time, as a result of an adjustment made
pursuant to this Section 4, the Holder of this Warrant shall, upon Exercise of
this Warrant, become entitled to receive shares and/or other securities or
assets (other than Common Stock) then, wherever appropriate, all references
herein to shares of Common Stock shall be deemed to refer to and include such
shares and/or other securities or assets; and thereafter the number of such
shares and/or other securities or assets shall be subject to adjustment from
time to time in a manner and upon terms as nearly equivalent as practicable to
the provisions of this Section 4.
5. Fractional Interests.
No fractional shares or scrip representing fractional shares shall be
issuable upon the Exercise of this Warrant, but on Exercise of this Warrant, the
Holder hereof may purchase only a whole number of shares of Common Stock. The
Company shall make a payment in cash in respect of any fractional shares which
might otherwise be issuable upon Exercise of this Warrant, calculated by
multiplying the fractional share amount by the market price of the Companys
Common Stock on the Date of Exercise as reported on the Nasdaq National Market
or such other exchange or system on which the Companys Common Stock is traded.
6. Reservation of Shares.
The Company shall at all times reserve for issuance such number of
authorized and unissued shares of Common Stock (or other securities substituted
therefor as herein above provided) as shall be sufficient for Exercise of this
Warrant. The Company covenants and agrees that upon Exercise of this Warrant,
all shares of Common Stock issuable upon such Exercise shall be duly and validly
issued, fully paid, nonassessable and not subject to preemptive rights of any
shareholders.
7. Restrictions on Transfer.
This Warrant and the Common Stock issuable on Exercise hereof have
been or will be acquired by the Holder hereof for investment for its own account
and not with a view to the distribution thereof, have not been registered under
the Securities Act of 1933, as amended (the "Act") or under any state securities
laws (the "State Acts"), and may not be sold, transferred, pledged, hypothecated
or otherwise disposed of in the absence of registration or the availability of
an exemption from registration under the Act and any applicable State Acts and,
in the event a Holder believes an exemption from the registration requirements
of the Act and any applicable State Acts is available, the Holder must deliver a
legal opinion satisfactory in form and substance to the Company and its counsel,
stating that such exemption is available. All shares of Common Stock issued
upon Exercise of this Warrant shall bear an appropriate legend to such effect.
Holder has represented to the Company that it and any transferee of all or any
portion of this Warrant is and will remain at all times while this Warrant is
outstanding an "accredited investor" as defined in Regulation D promulgated
under the Act.
8. Benefits of this Warrant.
Nothing in this Warrant shall be construed to confer upon any person
other than the Company and the Holder of this Warrant any legal or equitable
right, remedy or claim under this Warrant and this Warrant shall be for the sole
and exclusive benefit of the Company and the Holder of this Warrant.
9. Applicable Law.
This Warrant is issued under and shall for all purposes be governed by
and construed in accordance with the laws of the State of Georgia. Jurisdiction
for any dispute regarding this Warrant lies in Georgia.
10. Loss of Warrant.
Upon receipt by the Company of evidence of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of indemnity or security reasonably satisfactory to the Company,
and upon surrender and cancellation of this Warrant, if mutilated, the Company
shall execute and deliver a new Warrant of like tenor and date.
11. Notice to Company and Holder.
Notices or demands pursuant to this Warrant to be given or made by the
Holder of this Warrant to or on the Company shall be sufficiently given or made
if sent by certified or registered mail, return receipt requested, postage
prepaid, and addressed, until another address is designated in writing by the
Company, AER Energy Resources, Inc., 4600 Highlands Parkway, Suite G, Smyrna, GA
30082, Attention: Chief Executive Officer. Notices or demands pursuant to this
Warrant to be given or made by the Company to or on the Holder of this Warrant
shall be sufficiently given or made if sent by certified or registered mail,
return receipt requested, postage prepaid, and addressed to the Holder as
follows: FW AER II, L.P., 201 Main Street, Suite 2600, Ft. Worth, Texas 76102,
Attn:. Vice President and Controller, with a copy to David G. Brown, c/o Arbor
Investors, 2775 Sand Hill Road, Suite 220, Menlo Park, California 94025 or
another person or address designated in writing by Holder.
(signature follows on next page)
IN WITNESS WHEREOF, this Warrant is hereby executed effective as of the
date set forth below.
Dated as of April 3, 2000.
AER ENERGY RESOURCES, INC.
By:
Name:___________________________________
Title: __________________________________
SUBSCRIPTION FORM
TO: AER ENERGY RESOURCES, INC.
The undersigned hereby irrevocably exercises the right to purchase
_______________ shares of Common Stock of AER Energy Resources, Inc., a Georgia
corporation, evidenced by the attached Warrant, and herewith makes payment of
the Exercise Price with respect to such shares in full, all in accordance with
the conditions and provisions of said Warrant.
The undersigned represents that it is an "accredited investor" as defined
in Regulation D under the Securities Act of 1933, as amended, agrees not to
offer, sell, transfer or otherwise dispose of any of such Common Stock, except
in accordance with the provisions of Section 7 of the Warrant, and consents that
the following legend may be affixed to the certificates for the Common Stock
hereby subscribed for, if such legend is applicable:
"The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended (the "Securities Act"), or any
state securities law, and may not be sold, transferred, pledged,
hypothecated or otherwise disposed of until either (i) a registration
statement under the Securities Act and applicable state securities laws
shall have become effective with regard thereto, or (ii) the corporation
shall have received an opinion of counsel acceptable to the corporation and
its counsel that an exemption from registration under the Securities Act or
applicable state securities laws is available in connection therewith."
The undersigned requests that certificates for such shares be issued, and a
warrant representing any unexercised portion thereof be issued, pursuant to the
Warrant in the name of the Registered Holder and delivered to the undersigned at
the address set forth below:
Dated:
Signature of Registered Holder
Name of Registered Holder (Print)
Address
The attached Warrant and the securities issuable on exercise thereof have not
been registered under the Securities Act of 1933, as amended, or any state
securities law and may not be sold, transferred, pledged, hypothecated or
otherwise disposed of in the absence of registration or the availability of an
exemption from registration under said Act or any state securities law.
ASSIGNMENT
(To be executed by the registered Holder
desiring to transfer the Warrant)
FOR VALUE RECEIVED, the undersigned Holder of the attached Warrant hereby sells,
assigns and transfers unto the person or persons below named the right to
purchase ____________ shares of the Common Stock of AER ENERGY RESOURCES, INC.
evidence by the attached Warrant and does hereby irrevocably constitute and
appoint _____________________________ attorney to transfer the said Warrant on
the books of the Company, with full power of substitution in the premises.
Dated:
Signature
Fill in for new Registration of Warrant: Signature Guarantee:
Name Name of Guarantor
By:
Name:
Address Title:
Please print name and address of assignee
(including zip code)
NOTICE
The signature to the foregoing Subscription Form or Assignment must correspond
to the name as written upon the face of the attached Warrant in every
particular, without alteration or enlargement or any change whatsoever.
AER ENERGY RESOURCES, INC.
4600 Highlands Parkway, Suite G
Smyrna, Georgia 30082
November 6, 1997
FW AER Partners, L.P.
201 Main Street, Suite 3100
Fort Worth, Texas 76102
Dear Sirs:
This letter amends that certain AER Energy Resources, Inc. Securities
Purchase Agreement by and between FW AER Partners, L.P., a Texas limited
partnership ("Purchaser"), and AER Energy Resources, Inc., a Georgia corporation
("AER"), dated as of May 13, 1996 (the "Agreement"), pursuant to which the
Purchaser purchased from AER 1,584,158 shares of AER's common stock, no par
value (the "Common Stock"), and a warrant to purchase 835,000 shares of Common
Stock. All defined terms used but not otherwise defined herein shall have the
respective meanings given them in the Agreement.
1. Section 4(a) of the Agreement is hereby amended to read in its entirety
as follows:
(a) Demand Registration. If at any time after two (2) years and prior to
five (5) years from the date of the Closing, AER shall receive a written request
from Purchaser that AER file a registration statement under the Securities Act,
covering all or any portion of the Shares or all or any portion of the Warrant
Shares, AER shall, not later than ninety (90) days after receipt of such written
request, file a registration statement with the Commission relating to the
Shares or Warrant Shares as to which such request for a demand registration
relates together with all other shares of Common Stock owned by Purchaser and
shares of Common Stock owned by Keystone, Inc., David G. Brown, Mark A. Wolfson
or "affiliates" or "associates" thereof, as such terms are defined in the
Securities Act (collectively, the "Third Party Shareholders"), to the extent
such shares of Common Stock are not then freely tradeable under the Securities
Act, as the notice requests be included in such registration (all of the
foregoing hereinafter collectively referred to as, the "Requested Shares"), and
AER shall use its best efforts to cause the registration statement (which may
cover, without limitation, an offering on a delayed or continuous basis open for
up to one hundred eighty (180) days pursuant to Commission Rule 415) for the
Requested Shares to become effective under the Securities Act. AER shall be
obligated to effect only two (2) registrations pursuant to this Section 4(a).
Any such request shall be subject to the rights of the Debenture Subscribers
(defined below) pursuant to the Registration Rights Agreement dated as of
November 22, 1995 among AER, the Debenture Subscribers and Swartz Investments,
Inc. (the "Registration Rights Agreement").
2. Section 4(c) of the Agreement is hereby amended to read in its entirety
as follows:
(c) "Piggyback" Registration. If at any time after two (2) years and
prior to five (5) years from the date of the Closing, AER shall determine to
proceed with the preparation and filing of a registration statement under the
Securities Act in connection with the proposed offer and sale for money of any
of its equity securities by it or any of its security holders (other than on
Form S-4 or Form S-8 promulgated under the Securities Act or any successor or
similar form), AER will give written notice of its determination to Purchaser.
Upon the written request of Purchaser or any Third Party Shareholder given to
AER within ten (10) days after Purchaser's receipt of any such notice by AER,
AER will cause all of the shares of Common Stock that Purchaser and/or any of
the Third Party Shareholders have requested be registered (the "Piggyback
Shares") to be included in such registration statement, but only to the extent
the shares of Common Stock are not then freely tradeable under the Securities
Act; provided, however, that such request shall be subject to the rights of the
Debenture Subscribers pursuant to the Registration Rights Agreement, and
provided, further, that, if the managing underwriter, in the case of an
underwritten public offering, determines and advises in writing that the
inclusion of all the Piggyback Shares proposed to be included by Purchaser or
the Third Party Shareholders, as applicable, would interfere with the successful
marketing of the securities proposed to be registered by AER, then the number of
such Piggyback Shares to be included in the registration statement shall be
reduced in accordance with the recommendations of the managing underwriter,
except that if the managing underwriter determines and advises that the
inclusion in such registration statement of any Piggyback Shares would so
interfere, then no Piggyback Shares shall be included in such registration
statement but provided that any such reduction shall be made pro rata with
respect to Purchaser and any Third Party Shareholder requesting such
registration.
3. Section 4(d) of the Agreement is hereby amended to read in its entirety
as follows:
(d) Expenses. With respect to each inclusion of shares in a registration
statement pursuant to Section 4(a) or 4(b), AER shall bear the following fees,
costs and expenses: all registration, filing and NASD fees, printing expenses,
fees and disbursements of counsel and accountants for AER and all legal fees and
disbursements and other expenses of complying with state securities or blue sky
laws of any jurisdictions in which the securities to be offered are to be
registered or qualified. Fees and disbursements not expressly included above
shall be borne pro rata by the Purchaser and the Third Party Shareholders whose
shares are included in such registration statement.
4. Section 4(e) of the Agreement is hereby amended to read in its entirety
as follows:
(e) Indemnification, Etc. In the event that shares are registered
pursuant to Section 4(a) or 4(c), Purchaser and any Third Party Shareholder
registering shares of Common Stock, as applicable, and AER shall execute
reasonable and customary underwriting, indemnification and lock-up agreements
relating to such registration and shall undertake reasonable and customary
registration procedures.
5. Section 8(c) of the Agreement is hereby amended to read in its
entirety as follows:
(c) Assignment. Except in the case of a transfer permitted under Section
5(a), no assignment or transfer by Purchaser or any Third Party Shareholder of
their respective rights and obligations under this Agreement shall be made by
merger or other operation of law or otherwise except with the prior written
consent of AER. This Agreement is binding upon the parties and their successors
and assigns and inures to the benefit of the parties and their permitted
successors and assigns and, when appropriate to effect the binding nature of
this Agreement for the benefit of the other parties, of any other successor or
assign.
6. Except as amended hereby, the Agreement remains in full force and
effect.
If you are in agreement with the foregoing, please so indicate by signing
this letter in the space provided below.
Sincerely,
AER ENERGY RESOURCES, INC.
By:
Name:
Title:
AGREED TO AND ACCEPTED:
FW AER PARTNERS, L.P.
By: Group 31, Inc.,
General Partner
By:
Name:
Title:
