EXHIBIT 10.26
THIS WARRANT AND THE SECURITIES WHICH MAY BE ISSUED UPON EXERCISE OF THIS
WARRANT (THE "WARRANT SHARES") HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "ACT'), OR ANY STATE BLUE SKY LAW AND THE HOLDER OF
THIS WARRANT OR ANY WARRANT SHARES MAY NOT TRANSFER ANY BENEFICIAL INTEREST
THEREIN ABSENT REGISTRATION OR EXEMPTION FROM REGISTRATION UNDER THE ACT AND
APPLICABLE BLUE SKY LAWS.
WARRANT
To Purchase Shares of
Common Stock of
XATA CORPORATION
THIS CERTIFIES THAT for good and valuable consideration, ____________
("Name") or registered assigns is entitled to subscribe for and purchase from
XATA Corporation, a Minnesota corporation (the "Company"), at any time after
______________, to and including ____________, subject to the terms and
conditions set forth herein, __________ fully paid and nonassessable shares of
the Common Stock of the Company at the price of $______ per share (the "Warrant
Exercise Price"), subject to Section 1 hereof and the other provisions of this
Warrant. The shares which may be acquired upon exercise of this Warrant are
referred to herein as the "Warrant Shares." As used herein the term "Holder"
means __________, any party who acquires all or a part of this Warrant as a
registered transferee of _________ or any record holder or holders of the
Warrant Shares issued upon exercise, whether in whole or in part, of the
Warrant; the term "Common Stock" means and includes the Company's presently
authorized common stock, $.0l par value, and shall also include any capital
stock of any class of the Company hereafter authorized which shall not be
limited to a fixed sum or percentage in respect of the rights of the holders
thereof to participate in dividends or in the distribution of assets upon the
voluntary or involuntary liquidation dissolution, or winding up of the Company;
and the term "Convertible Securities" means any stock or other securities
convertible into, or exchangeable for, Common Stock.
This Warrant is subject to the following provisions, terms and
conditions:
1. Exercise; Transferability.
(a) The rights represented by this Warrant may be exercised for
purchase, in whole or in part (but not as to a fractional share), of Warrant
Shares by written notice of exercise (in the form attached hereto) delivered to
the Company at the principal office of the Company prior to the expiration of
this Warrant and accompanied or preceded by the surrender of this manually
signed Warrant along with a cashier's or certified check in payment of the
Warrant Exercise Price for such shares.
(b) In the alternative to exercise pursuant to Subsection 1(a), above,
if the Fair Market Value (as defined below) of one share of Common Stock of the
Company is greater than the Warrant Exercise Price (at the date of calculation
as set forth below), in lieu of exercising the
rights represented by this Warrant for cash as provided in Subsection 1(a), the
Holder may elect to receive Warrant Shares equal to the value (as determined
below) of this Warrant (or the portion thereof being canceled) by surrender of
this Warrant at the principal office of the Company together with a notice of
such election, in which event the Company shall issue to the Holder hereof a
number of Warrant Shares computed using the following formula:
X = Y (A-B)
-------
A
Where X = the number of Warrant Shares to be issued to the Holder
Y = the number of Warrant Shares purchasable under this
Warrant, or if only a portion of this Warrant is being
exercised, the portion of the Warrant being canceled
(at the date of such calculation)
A = the Fair Market Value of one share of Common Stock (at
the date of such calculation)
B = Warrant Exercise Price (as adjusted to the date of such
calculation)
For purposes of the above calculation, Fair Market Value of one share of Common
Stock shall be determined as follows:
(i) If the Company's Common Stock is listed on any established
stock exchange or a national market system, including without
limitation the Nasdaq National Market System (the "Nasdaq National
Market"), the Fair Market Value of one share of Common Stock shall be
the closing sales price for such stock (or the closing bid, if no sales
were reported) as quoted on such system or exchange (or the exchange
with the greatest volume of trading in the Common Stock) on the last
market trading day prior to the day of calculation, as reporting in the
Wall Street Journal or such other source as the Board of Directors of
the Company deems reliable;
(ii) If the Company's Common Stock is quoted in the Nasdaq
Smallcap Market (but not in the Nasdaq National Market) or is regularly
quoted by a recognized securities dealer but selling prices are not
reported, the Fair Market Value of one share of Common Stock shall be
the mean between the bid and asked prices for the Common Stock on the
last market trading day prior to the day of calculation, as reported in
the Wall Street Journal or such other source as the Board of Directors
of the Company deems reliable;
(iii) In the absence of an established market for the
Company's Common Stock, the Fair Market Value of one share of Common
Stock shall be determined in good faith by the Board of Directors of
the Company.
(c) This Warrant may not be sold, transferred, assigned, hypothecated
or divided into two or more Warrants of smaller denominations, nor may any
Warrant Shares issued pursuant to exercise of this Warrant be transferred,
except as provided in Section 7 hereof.
2. Exchange and Replacement. Subject to Sections 1 and 7 hereof, this
Warrant is exchangeable upon the surrender hereof by the Holder to the Company
at its office for new Warrants of like tenor and date representing in the
aggregate the right to purchase the number of Warrant Shares purchasable
hereunder, each of such new Warrants to represent the right to purchase such
number of Warrant Shares (not to exceed the aggregate total number purchasable
hereunder) as shall be designated by the Holder at the time of such surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it of the
loss, theft, destruction, or mutilation of this Warrant, and, in case of loss,
theft or destruction, of indemnity or security reasonably satisfactory to it,
and upon surrender and cancellation of this Warrant, if mutilated, the Company
will make and deliver a new Warrant of like tenor, in lieu of this Warrant. This
Warrant shall be promptly canceled by the Company upon the surrender hereof in
connection with any exchange or replacement. The Company shall pay all expenses,
taxes (other than stock transfer taxes), and other charges payable in connection
with the preparation, execution, and delivery of Warrants pursuant to this
Section 2.
3. Issuance of the Warrant Shares.
(a) The Company agrees that the shares of Common Stock purchased
hereby shall be and are deemed to be issued to the Holder as of the close of
business on the date on which this Warrant shall have been surrendered and the
payment made for such Warrant Shares as aforesaid. Certificates for the Warrant
Shares so purchased shall be delivered to the Holder within a reasonable time,
not exceeding fifteen (15) days after the rights represented by this Warrant
shall have been so exercised, and, unless this Warrant has expired, a new
Warrant representing the right to purchase the number of Warrant Shares, if any,
with respect to which this Warrant shall not then have been exercised shall also
be delivered to the Holder within such time.
(b) Notwithstanding the foregoing, however, the Company shall not be
required to deliver any certificate for Warrant Shares upon exercise of this
Warrant except in accordance with exemptions from the applicable securities
registration requirements or registrations under applicable securities laws.
Nothing herein, however, shall obligate the Company to effect registrations
under federal or state securities laws. The Holder agrees to execute such
documents and make such representations, warranties, and agreements as may be
required solely to comply with the exemptions relied upon by the Company, or the
registrations made, for the issuance of the Warrant Shares.
4. Covenants of the Company. The Company covenants and agrees that all
Warrant Shares will, upon issuance, be duly authorized and issued, fully paid,
nonassessable, and free from all taxes, liens, and charges with respect to the
issue thereof. The Company further covenants and agrees that during the period
within which the rights represented by this Warrant may be exercised, the
Company will at all times have authorized and reserved for the purpose of issue
or transfer upon exercise of the subscription rights evidenced by this Warrant a
sufficient number of shares of Common Stock to provide for the exercise of the
rights represented by this Warrant.
5. Antidilution Adjustments. The provisions of this Warrant are
subject to adjustment as provided in this Section 5.
(a) The Warrant Exercise Price and the number of Warrant Shares shall
be adjusted from time to time such that in case the Company shall hereafter: (i)
pay a dividend or make a distribution on its Common Stock in shares of Common
Stock, (ii) subdivide its outstanding shares of Common Stock into a greater
number of shares, (iii) combine its outstanding shares of Common Stock into a
smaller number of shares, or (iv) issue by reclassification of its Common Stock
any shares of capital stock of the Company, then the Warrant Exercise Price in
effect immediately prior to such event shall (until adjusted again pursuant
hereto) be adjusted immediately after such event to a price (calculated to the
nearest full cent) determined by dividing (a) the total number of shares of
Common Stock outstanding immediately prior to such event (including the maximum
number of shares of Common Stock issuable in respect of any securities
convertible into Common Stock), multiplied by the then existing Warrant Exercise
Price, by (b) the total number of shares of Common Stock outstanding immediately
after such event (including the maximum number of shares of Common Stock
issuable in respect to any securities convertible into Common Stock), and the
resulting quotient shall be the adjusted Warrant Exercise Price per share. An
adjustment made pursuant to this Subsection shall become effective immediately
after the record date in the case of a dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision,
combination or reclassification. If, as a result of an adjustment made pursuant
to this Subsection, the Holder of any Warrant thereafter surrendered for
exercise shall become entitled to receive shares of two or more classes of
capital stock or shares of Common Stock and other capital stock of the Company,
the Board of Directors (whose determination shall be conclusive) shall determine
the allocation of the adjusted Warrant Exercise Price between or among shares of
such classes of capital stock or shares of Common Stock and other capital stock.
All calculations under this Subsection shall be made to the nearest cent or to
the nearest 1/100 of a share, as the case may be. In the event that at any time
as a result of an adjustment made pursuant to this Subsection, the holder of any
Warrant thereafter surrendered for exercise shall become entitled to receive any
shares of the Company other than shares of Common Stock, thereafter the Warrant
Exercise Price of such other shares so receivable upon exercise of any Warrant
shall be subject to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to Common Stock
contained in this Section.
(b) Upon each adjustment of the Warrant Exercise Price pursuant to
Section 5(a) above, the Holder of each Warrant shall thereafter (until another
such adjustment) be entitled to purchase at the adjusted Warrant Exercise Price
the number of shares, calculated to the nearest full share, obtained by
multiplying the number of shares specified in such Warrant (as adjusted as a
result of all adjustments in the Warrant Exercise Price in effect prior to such
adjustment) by the Warrant Exercise Price in effect prior to such adjustment and
dividing the product so obtained by the adjusted Warrant Exercise Price.
(c) In case of any consolidation or merger to which the Company is a
party other than a merger or consolidation in which the Company is the
continuing corporation, or in case of any sale or conveyance to another
corporation of the property of the Company as an entirety or
substantially as an entirety, or in the case of any statutory exchange of
securities with another corporation (including any exchange effected in
connection with a merger of a third corporation into the Company), there shall
be no adjustment under Subsection (a) of this Section above but the Holder of
each Warrant then outstanding shall have the right thereafter to convert such
Warrant into the kind and amount of shares of stock and other securities and
property which he would have owned or have been entitled to receive immediately
after such consolidation, merger, statutory exchange, sale, or conveyance had
such Warrant been converted immediately prior to the effective date of such
consolidation, merger, statutory exchange, sale, or conveyance and in any such
case, if necessary, appropriate adjustment shall be made in the application of
the provisions set forth in this Section with respect to the rights and
interests thereafter of any Holders of the Warrant, to the end that the
provisions set forth in this Section shall thereafter correspondingly be made
applicable, as nearly as may reasonably be, in relation to any shares of stock
and other securities and property thereafter deliverable on the exercise of the
Warrant. The provisions of this Subsection shall similarly apply to successive
consolidations, mergers, statutory exchanges, sales or conveyances.
(d) Upon any adjustment pursuant to this Section 5, the Company shall
give written notice thereof, by first-class mail, postage prepaid, addressed to
the Holder as shown on the Common Stock register of the Company, which notice
shall state the Warrant Exercise Price resulting from such adjustment and the
increase or decrease, if any, in the number of shares of Common Stock or other
securities and/or property purchasable at such price upon the exercise of this
Warrant, setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based.
6. No Voting Rights. This Warrant shall not entitle the Holder to any
voting rights or other rights as a shareholder of the Company.
7. Notice of Transfer of Warrant or Resale of the Warrant Shares.
(a) The Holder, by acceptance hereof, agrees to give written notice to
the Company before transferring this Warrant or transferring any Warrant Shares
of such Holder's intention to do so, describing briefly the manner of any
proposed transfer. Promptly upon receiving such written notice, the Company
shall present copies thereof to the Company's counsel. If in the opinion of such
counsel the proposed transfer may be effected without registration or
qualification (under any federal or state securities laws), the Company, as
promptly as practicable, shall notify the Holder of such opinion, whereupon the
Holder shall be entitled to transfer this Warrant or to dispose of Warrant
Shares received upon the previous exercise of this Warrant, all in accordance
with the terms of the notice delivered by the Holder to the Company; provided
that an appropriate legend may be endorsed on this Warrant or the certificates
for such Warrant Shares respecting restrictions upon transfer thereof necessary
or advisable in the opinion of counsel and satisfactory to the Company to
prevent further transfers which would be in violation of Section 5 of the
Securities Act of 1933, as amended (the "1933 Act") and applicable state
securities laws; and provided further that the prospective transferee or
purchaser shall execute such documents and make such representations,
warranties, and agreements as may be
required solely to comply with the exemptions relied upon by the Company for the
transfer or disposition of the Warrant or Warrant Shares.
(b) If in the opinion of counsel to the Company, the proposed transfer
or disposition of this Warrant or such Warrant Shares described in the written
notice given pursuant to this Section 7 may not be effected without registration
or qualification of the Warrant or such Warrant Shares, the Company shall
promptly give written notice thereof to the Holder, and the Holder will limit
its activities in respect to such as, in the opinion of both such counsel, are
permitted by law.
8. Fractional Shares. Fractional shares shall not be issued upon the
exercise of this Warrant, but in any case where the Holder would, except for the
provisions of this Section, be entitled under the terms hereof to receive a
fractional share, the Company shall, upon the exercise of this Warrant for the
largest number of whole shares then called for, pay a sum in cash equal to the
excess, if any, of the Fair Market Value (as defined in Section 1(b) hereof) of
such fractional share over the proportional part of the Warrant Exercise Price
represented by such fractional share.
IN WITNESS WHEREOF, XATA Corporation has caused this Warrant to be
signed by its duly authorized officer and this Warrant to be dated
________________.
"Company"
XATA CORPORATION
--------------------------------------
By
--------------------------------------
Print Name
Its
-----------------------------------
Print Title
To: XATA Corporation
NOTICE OF EXERCISE OF WARRANT
To Be Executed by the Registered Holder in Order to Exercise the Warrant
The undersigned hereby irrevocably elects to exercise the attached Warrant
[check as appropriate] for ___ cash or ___ by exchange (please attach
calculation of shares to be issued) for ____________ of the shares issuable upon
the exercise of such Warrant, and requests that certificates for such shares
(together with a new Warrant to purchase the number of shares, if any, with
respect to which this Warrant is not exercised) shall be issued in the name of
_______________________ (Federal Tax Identification Number ______________).
NOTE: If the person to whom shares are to be issued is other than the registered
holder of this Warrant, this Notice of Exercise must be accompanied by a
signature-guaranteed Assignment Separate From Certificate.
____________________________________
(Print Name)
Please insert Federal Tax
Identification Number
of registered holder of ____________________________________
certificate (__________) (Address)
Date: ________________, ____ ____________________________________
Signature*
*The signature on the Notice of Exercise of Warrant must correspond to the name
as written upon the face of the Warrant in every particular without alteration
or enlargement or any change whatsoever. When signing on behalf of a
corporations partnership, trust or other entity, please indicate your positions)
and title(s) with such entity.
ASSIGNMENT FORM
To be signed only upon authorized transfer of Warrants.
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and
transfers unto the right to purchase the securities of XATA Corporation to
which the within Warrant relates and appoints ______________________, attorney,
to transfer said right on the books of XATA Corporation with full power of
substitution in the premises.
Dated: ________________ ______________________________________
(Signature)
______________________________________
______________________________________
(Address)
