EXHIBIT 4.2
GENISYS RESERVATION SYSTEMS, INC.
AND
CONTINENTAL STOCK TRANSFER
AND TRUST COMPANY
REDEEMABLE WARRANT AGREEMENT
Dated as of , 1996
AGREEMENT, dated as of this _____ day of ___________,
1996, between GENISYS RESERVATION SYSTEMS, INC., a New
Jersey corporation (the "Company"), and CONTINENTAL STOCK
TRANSFER AND TRUST COMPANY, as Warrant Agent (the
"Warrant Agent").
W I T N E S S E T H:
WHEREAS, in connection with (i) the offering to the public
pursuant to the Prospectus (the "Prospectus") contained in the
Company's Registration Statement on Form SB-2 (Registration No.
) of up to 800,000 shares of the Company's common stock,
$.0001 par value per share (the "Common Stock"), (ii) the offering to
the public pursuant to the Prospectus of up to 2,100,000 redeemable
warrants (the "Warrants") comprised of 1,300,000 Class A
Redeemable Warrants ("Class A Warrants") and 800,000 Class B
Redeemable Warrants ("Class B Warrants"), each Warrant entitling
the holder thereof to purchase one additional share of Common Stock,
(iii) the over-allotment option to purchase up to an additional 120,000
shares of Common Stock and/or 195,000 Class A Warrants and
120,000 Class B Warrants, (the "Over-allotment Option"), and (iv) the
sale to X.X. Xxxxx & Co., Inc. ("X.X. Xxxxx"), its successors and
assigns (the "Underwriter"), of warrants (the "Underwriter's
Warrants") to purchase up to 80,000 shares of Common Stock and/or
130,000 Class A Warrants and 80,000 Class B Warrants, the
Company will issue up to 2,625,000 Warrants (subject to increase as
provided in the Underwriter's Warrant Agreement and herein); and
WHEREAS, the Company desires to provide for the issuance
of certificates representing the Warrants; and
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WHEREAS, the Company desires the Warrant Agent to act
on behalf of the Company, and the Warrant Agent is willing to so act,
in connection with the issuance, registration, transfer and exchange of
certificates representing the Warrants and the exercise of the
Warrants.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements hereinafter set forth and for the purpose of
defining the terms and provisions of the Warrants and the certificates
representing the Warrants and the respective rights and obligations
thereunder of the Company, X.X. Xxxxx, the holders of certificates
representing the Warrants and the Warrant Agent, the parties hereto
agree as follows:
SECTION 1. Definitions. As used herein, the following
terms shall have the following meanings, unless the context shall
otherwise require:
(a) "Common Stock" shall mean stock of the Company of any
class whether now or hereafter authorized, which has the right to
participate in the voting and in the distribution of earnings and assets
of the Company without limit as to amount or percentage.
(b) "Corporate Office" shall mean the office of the Warrant
Agent (or its successor) at which at any particular time its principal
business in New York, New York, shall be administered, which office
is located on the date hereof at 0 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx
00000.
(c) "Exercise Date" shall mean, subject to the provisions of
Section 5(b) hereof, as to any Warrant, the date on which the Warrant
Agent shall have received both (i) the Warrant Certificate representing
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such Warrant, with the exercise form thereon duly executed by the
Registered Holder hereof or his attorney duly authorized in writing,
and (ii) payment in cash or by check made payable to the Warrant
Agent for the account of the Company, of the amount in lawful money
of the United States of America equal to the applicable Purchase Price
in good funds.
(d) "Initial Warrant Exercise Date" shall mean ,1997.
(e) "Initial Warrant Redemption Date" shall mean six (6)
months after the date of the Prospectus.
(f) "Purchase Price" shall mean, subject to modification and
adjustment as provided in Section 8, $5.75 per share for each Class A
Warrant and $6.75 per share for each Class B Warrant and further
subject to the Company's right, in its sole discretion, to decrease the
Purchase Price.
(g) "Registered Holder" shall mean the person in whose name
any certificate representing the Warrants shall be registered on the
books maintained by the Warrant Agent pursuant to Section 6.
(h) "Subsidiary" or "Subsidiaries" shall mean any corporation
or corporations, as the case may be, of which stock having ordinary
power to elect a majority of the Board of Directors of such
corporation (regardless of whether or not at the time stock of any
other class or classes of such corporation shall have or may have
voting power by reason of the happening of any contingency) is at the
time directly or indirectly owned by the Company or by one or more
Subsidiaries, or by the Company and one or more Subsidiaries.
(i) "Transfer Agent" shall mean Continental Stock Transfer
and Trust Company, or its authorized successor.
(j) "Underwriting Agreement" shall mean the underwriting
agreement dated ____________, 1996 between the Company and the
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Underwriter relating to the purchase for resale to the public of
800,000 shares of Common Stock, 1,300,000 Class A Warrants and
800,000 Class B Warrants plus an over-allotment option of 120,000
shares of Common Stock and/or 195,000 Class A Warrants and
120,000 Class B Warrants.
(k) "Underwriter's Warrant Agreement" shall mean the
agreement dated as of , 1996 between the Company and the
Underwriter relating to and governing the terms and provisions of the
Underwriter's Warrants.
(l) "Warrant Certificate" shall mean certificates representing
each of the Warrants substantially in the form annexed hereto as
Exhibit A.
(m) "Warrant Expiration Date" shall mean, unless the
Warrants are redeemed as provided in Section 9 hereof prior to such
date, 5:00 p.m. (New York time), on , 2001, or, if such date
shall in the State of New York be a holiday or a day on which banks
are authorized to close, then 5:00 p.m. (New York time) on the next
following day which in the State of New York is not a holiday or a
day on which banks are authorized to close, subject to the Company's
right, prior to the Warrant Expiration Date, in its sole discretion, to
extend such Warrant Expiration Date on five business days prior
written notice to the Registered Holders.
(n) "Warrant Agent" shall mean Continental Stock Transfer
and Trust Company, or its authorized successor.
SECTION 2. Warrants and Issuance of Warrant
Certificates.
(a) Each Warrant shall initially entitle the Registered Holder
of the Warrant Certificate representing such Warrant to purchase at
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the Purchase Price therefor from the Initial Warrant Exercise Date
until the Warrant Expiration Date one share of Common Stock upon
the exercise thereof, subject to modification and adjustment as
provided in Section 8.
(b) Upon execution of this Agreement, Warrant Certificates
representing 1,300,000 Class A Warrants to purchase up to an
aggregate of 1,300,000 shares of Common Stock and 800,000 Class
B Warrants to purchase up to an aggregate 800,000 shares of
Common Stock (subject to modification and adjustment as provided
in Section 8) shall be executed by the Company and delivered to the
Warrant Agent.
(c) Upon exercise of the Over-allotment Option, in whole or
in part, Warrant Certificates representing up to 195,000 Class A
Warrants to purchase up to an aggregate of 195,000 shares of
Common Stock and 120,000 Class B Warrants to purchase up to an
aggregate of 120,000 shares of Common Stock (subject to
modification and adjustment as provided in Section 8) shall be
executed by the Company and delivered to the Warrant Agent.
(d) Upon exercise of the Underwriter's Warrants as provided
therein, Warrant Certificates representing all or a portion of 130,000
Class A Warrants to purchase up to an aggregate of 130,000 shares
of Common Stock and 80,000 Class B Warrants to purchase up to an
aggregate of 80,000 shares of Common Stock (subject to modification
and adjustment as provided in Section 8 hereof and in the
Underwriter's Warrant Agreement), shall be countersigned, issued and
delivered by the Warrant Agent upon written order of the Company
signed by its Chairman of the Board, President or a Vice President and
by its Treasurer or an Assistant Treasurer or its Secretary or an
Assistant Secretary.
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(e) From time to time, up to the Warrant Expiration Date, as
the case may be, the Warrant Agent shall countersign and deliver
Warrant Certificates in required denominations of one or whole
number multiples thereof to the person entitled thereto in connection
with any transfer or exchange permitted under this Agreement. No
Warrant Certificates shall be issued except (i) Warrant Certificates
initially issued hereunder, (ii) Warrant Certificates issued upon any
transfer or exchange of Warrants, (iii) Warrant Certificates issued in
replacement of lost, stolen, destroyed or mutilated Warrant
Certificates pursuant to Section 7, (iv) Warrant Certificates issued
pursuant to the Underwriter's Warrant Agreement (including Warrants
in excess of the Underwriter's Warrants to purchase 80,000 shares of
Common Stock and/or 130,000 Class A Warrants and 80,000 Class
B Warrants issued as a result of the anti-dilution provisions contained
in the Underwriter's Warrant Agreement), and (v) at the option of the
Company, Warrant Certificates in such form as may be approved by
its Board of Directors, to reflect any adjustment or change in the
Purchase Price, the number of shares of Common Stock purchasable
upon exercise of the Warrants or the redemption price therefor made
pursuant to Section 8 hereof.
SECTION 3. Form and Execution of Warrant Certificates.
(a) The Warrant Certificates shall be substantially in the form
annexed hereto as Exhibit A (the provisions of which are hereby
incorporated herein) and may have such letters, numbers or other
marks of identification or designation and such legends, summaries or
endorsements printed, lithographed or engraved thereon as the
Company may deem appropriate and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply with
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any law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any stock exchange on which Warrants may
be listed, or to conform to usage. The Warrant Certificates shall be
dated the date of issuance thereof (whether upon initial issuance,
transfer, exchange or in lieu of mutilated, lost, stolen or destroyed
Warrant Certificates).
(b) Warrant Certificates shall be executed on behalf of the
Company by its Chairman of the Board, President or any Vice
President and by its Treasurer or an Assistant Treasurer or its
Secretary or an Assistant Secretary, by manual signatures or by
facsimile signatures printed thereon, and shall have imprinted thereon
a facsimile of the Company's seal. Warrant Certificates shall be
manually countersigned. In case any officer of the Company who shall
have signed any of the Warrant Certificates shall cease to be such
officer of the Company before the date of issuance of the Warrant
Certificates or before countersignature by the Warrant Agent and
issue and delivery thereof, such Warrant Certificates, nevertheless,
may be countersigned by the Warrant Agent, issued and delivered with
the same force and effect as though the person who signed such
Warrant Certificates had not ceased to be such officer of the
Company.
SECTION 4. Exercise.
(a) Warrants in denominations of one or whole number
multiples thereof may be exercised at any time commencing with the
Initial Warrant Exercise Date, and ending at the close of business on
the Warrant Expiration Date, upon the terms and subject to the
conditions set forth herein (including the provisions set forth in
Sections 5 and 9 hereof) and in the applicable Warrant Certificate. A
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Warrant shall be deemed to have been exercised immediately prior to
the close of business on the Exercise Date, provided that the Warrant
Certificate representing such Warrant, with the exercise form thereon
duly executed by the Registered Holder thereof or his attorney duly
authorized in writing, together with payment in cash or by check made
payable to the Warrant Agent for the account of the Company, of an
amount in lawful money of the United States of America equal to the
applicable Purchase Price has been received in good funds by the
Warrant Agent. The person entitled to receive the securities
deliverable upon such exercise shall be treated for all purposes as the
holder of such securities as of the close of business on the Exercise
Date. As soon as practicable on or after the Exercise Date and in any
event within five business days after such date, the Warrant Agent on
behalf of the Company shall cause to be issued to the person or
persons entitled to receive the same a Common Stock certificate or
certificates for the shares of Common Stock deliverable upon such
exercise, and the Warrant Agent shall deliver the same to the person
or persons entitled thereto. Upon the exercise of any Warrant, the
Warrant Agent shall promptly notify the Company in writing of such
fact and of the number of securities delivered upon such exercise and,
subject to subsection (b) below, shall cause all payments of an amount
in cash or by check made payable to the order of the Company, equal
to the Purchase Price, to be deposited promptly in the Company's
bank account.
(b) At any time upon the exercise of any Warrants after 181
days from the date hereof, the Warrant Agent shall, on a daily basis,
within two business days after such exercise, notify the Underwriter,
and its successors or assigns, of the exercise of any such Warrants and
shall, on a weekly basis (subject to collection of funds constituting the
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tendered Purchase Price, but in no event later than five business days
after the last day of the calendar week in which such funds were
tendered), remit to the Underwriter (so long as the Underwriter
solicited the exercise of such Warrant as indicated upon the
Subscription Form attached to the Warrant Certificate tendered for
exercise), an amount equal to four percent (4%) of the Purchase Price
of such Warrants being then exercised unless (1) the Underwriter shall
have notified the Warrant Agent that the payment of such amount
with respect to such Warrant is violative of the General Rules and
Regulations promulgated under the Securities Exchange Act of 1934,
as amended, (the "Exchange Act"), or the rules and regulations of the
National Association of Securities Dealers, Inc. ("NASD") or
applicable state securities of "blue sky" laws, or (2) the Warrants are
those underlying the Underwriter's Warrants, or (3) the market price
of the Common Stock on the subject Exercise Date is lower than the
Purchase Price, or (4) the Warrants are held in a discretionary
account, or (5) the Warrants are exercised in an unsolicited
transaction, in any of which events the Warrant Agent shall pay such
amount to the Company; provided that the Warrant Agent shall not be
obligated to pay any amounts pursuant to this Section 4(b) during any
week that such amounts payable are less than $1,000 and the Warrant
Agent's obligation to make such payments shall be suspended until the
amount payable aggregate $1,000, and provided further, that, in any
event, any such payment (regardless of amount) shall be made not less
frequently than monthly.
(c) The Company shall not be required to issue fractional
shares upon the exercise of Warrants. Warrants may only be
exercised in such multiples as are required to permit the issuance by
the Company of one or more whole shares. If one or more Warrants
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shall be presented for exercise in full at the same time by the same
Registered Holder, the number of whole shares which shall be issuable
upon such exercise thereof shall be computed on the basis of the
aggregate number of shares purchasable on exercise of the Warrants
so presented. If any fraction of a share would, except for the
provisions provided herein, be issuable on the exercise of any Warrant
(or specified portion thereof), the Company shall pay an amount in
cash equal to such fraction multiplied by the then current market value
of a share of Common Stock, determined as follows:
(1) If the Common Stock is listed or admitted to
unlisted trading privileges on the New York Stock Exchange
("NYSE") or the American Stock Exchange ("AMEX") or is traded
on The Nasdaq National Market (" Nasdaq/NM"), the current market
value of a share of Common Stock shall be the closing sale price of
the Common Stock at the end of the regular trading session on the last
business day prior to the date of exercise of the Warrants on
whichever of such exchanges or Nasdaq/NM had the highest average
daily trading volume for the Common Stock on such day; or
(2) If the Common Stock is not listed or admitted to
unlisted trading privileges on either the NYSE or the AMEX and is
not traded on Nasdaq/NM, but is quoted or reported on Nasdaq, the
current market value of a share of Common Stock shall be the average
of the last reported closing bid and asked prices (or the last sale price,
if then reported by Nasdaq) of the Common Stock at the end of the
regular trading session on the last business day prior to the date of
exercise of the Warrants as quoted or reported on Nasdaq, as the case
may be; or
(3) If the Common Stock is not listed or admitted to
unlisted trading privileges on either of the NYSE or the AMEX, and
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is not traded on Nasdaq/NM or quoted or reported on Nasdaq, but is
listed or admitted to unlisted trading privileges on the BSE or other
national securities exchange (other than the NYSE or the AMEX), the
current market value of a share of Common Stock shall be the closing
sale price of the Common Stock at the end of the regular trading
session on the last business day prior to the date of exercise of the
Warrants on whichever of such exchanges has the highest average
daily trading volume for the Common Stock on such day; or
(4) If the Common Stock is not listed or admitted to
unlisted trading privileges on any national securities exchange, or
listed for trading on Nasdaq/NM or quoted or reported on Nasdaq,
but is traded in the over-the-counter market, the current market value
of a share of Common Stock shall be the average of the last reported
bid and asked prices of the Common Stock reported by the National
Quotation Bureau, Inc. on the last business day prior to the date of
exercise of the Warrants; or
(5) If the Common Stock is not listed or admitted to
unlisted trading privileges on any national securities exchange, or
listed for trading on Nasdaq/NM or quoted or reported on Nasdaq,
and bid and asked prices of the Common Stock are not reported by
the National Quotation Bureau, Inc., the current market value of a
share of Common Stock shall be an amount, not less than the book
value thereof as of the end of the most recently completed fiscal
quarter of the Company ending prior to the date of exercise,
determined in accordance with generally accepted accounting
principles, consistently applied.
SECTION 5. Reservation of Shares; Listing; Payment of
Taxes; etc.
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(a) The Company covenants that it will at all times reserve
and keep available out of its authorized Common Stock, solely for the
purpose of issue upon exercise of Warrants, such number of shares of
Common Stock as shall then be issuable upon the exercise of all
outstanding Warrants. The Company covenants that all shares of
Common Stock which shall be issuable upon exercise of the Warrants
shall, at the time of delivery thereof, be duly and validly issued and
fully paid and nonassessable and free from all preemptive or similar
rights, taxes, liens and charges with respect to the issue thereof, and
that upon issuance such shares shall be listed on each securities
exchange, if any, on which the other shares of outstanding Common
Stock of the Company are then listed.
(b) The Company covenants that if any securities to be
reserved for the purpose of exercise of Warrants hereunder require
registration with, or approval of, any governmental authority under
any federal securities law before such securities may be validly issued
or delivered upon such exercise, then the Company will file a
registration statement under the federal securities laws or a post
effective amendment, use its best efforts to cause the same to become
effective and use its best efforts to keep such registration statement
current while any of the Warrants are outstanding and deliver a
prospectus which complies with Section 10(a)(3) of the Securities Act
of 1933, as amended, (the "Act"), to the Registered Holder exercising
the Warrant (except, if in the opinion of counsel to the Company, such
registration is not required under the federal securities law or if the
Company receives a letter from the staff of the Securities and
Exchange Commission (the "Commission") stating that it would not
take any enforcement action if such registration is not effected). The
Company will use its best efforts to obtain appropriate approvals or
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registrations under state "blue sky" securities laws. With respect to
any such securities, however, Warrants may not be exercised by, or
shares of Common Stock issued to, any Registered Holder in any state
in which such exercise would be unlawful.
(c) The Company shall pay all documentary, stamp or similar
taxes and other governmental charges that may be imposed with
respect to the issuance of Warrants, or the issuance or delivery of any
shares of Common Stock upon exercise of the Warrants; provided,
however, that if shares of Common Stock are to be delivered in a
name other than the name of the Registered Holder of the Warrant
Certificate representing any Warrant being exercised, then no such
delivery shall be made unless the person requesting the same has paid
to the Warrant Agent the amount of transfer taxes or charges incident
thereto, if any.
(d) The Warrant Agent is hereby irrevocably authorized as the
Transfer Agent to requisition from time to time certificates
representing shares of Common Stock or other securities required
upon exercise of the Warrants, and the Company will comply with all
such requisitions.
SECTION 6. Exchange and Registration of Transfer.
(a) Warrant Certificates may be exchanged for other Warrant
Certificates representing an equal aggregate number of Warrants or
may be transferred in whole or in part. Warrant Certificates to be so
exchanged shall be surrendered to the Warrant Agent at its Corporate
Office, and the Company shall execute and the Warrant Agent shall
countersign, issue and deliver in exchange therefor the Warrant
Certificate or Certificates which the Register Holder making the
exchange shall be entitled to receive.
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(b) The Warrant Agent shall keep, at such office, books in
which, subject to such reasonable regulations as it may prescribe, it
shall register Warrant Certificates and the transfer thereof. Upon due
presentment for registration of transfer of any Warrant Certificate at
such office, the Company shall execute and the Warrant Agent shall
issue and deliver to the transferee or transferees a new Warrant
Certificate or Certificates representing an equal aggregate number of
Warrants.
(c) With respect to any Warrant Certificates presented for
registration of transfer, or for exchange or exercise, the subscription
or exercise form, as the case may be, on the reverse thereof shall be
duly endorsed or be accompanied by a written instrument or
instruments or transfer and subscription, in form satisfactory to the
Company and the Warrant Agent, duly executed by the Registered
Holder thereof or his attorney duly authorized in writing.
(d) No service charge shall be made for any exchange or
registration of transfer of Warrant Certificates. However, the
Company may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection
therewith.
(e) All Warrant Certificates surrendered for exercise or for
exchange shall be promptly canceled by the Warrant Agent.
(f) Prior to due presentment for registration or transfer
thereof, the Company and the Warrant Agent may deem and treat the
Registered Holder of any Warrant Certificate as the absolute owner
thereof of each Warrant represented thereby (notwithstanding any
notations of
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ownership or writing thereon made by anyone other than the
Company or the Warrant Agent) for all purposes and shall not be
affected by any notice to the contrary.
SECTION 7. Loss or Mutilation. Upon receipt by the
Company and the Warrant Agent of evidence satisfactory to them of
the ownership of and the loss, theft, destruction or mutilation of any
Warrant Certificate and (in the case of loss, theft or destruction) of
indemnity satisfactory to them, and (in case of mutilation) upon
surrender and cancellation thereof, the Company shall execute and the
Warrant Agent shall countersign and deliver in lieu thereof a new
Warrant Certificate representing an equal aggregate number of
Warrants. Applicants for a substitute Warrant Certificate shall also
comply with such other reasonable regulations and pay such other
reasonable charges as the Warrant Agent may prescribe.
SECTION 8. Adjustment of Purchase Price and Number
of Shares of Common Stock Deliverable.
(a)(i) Except as hereinafter provided, in the event the
Company shall, at any time or from time to time after the date hereof,
issue any shares of Common Stock for a consideration per share less
than the "Fair Market Value" (as defined in Section 8(g)) or issue any
shares of Common Stock as a stock dividend to the holders of
Common Stock, or subdivide or combine the outstanding shares of
Common Stock into a greater or lesser number of shares (any such
issuance, subdivision or combination being herein called a "Change of
Shares"), then, and thereafter upon each further Change of Shares, the
Purchase Price for the Warrants (whether or not the same shall be
issued and outstanding) in effect immediately prior to such Change of
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Shares shall be changed to a price (including any applicable fraction
of a cent to the nearest cent) determined by dividing (i) the sum of (a)
the total number of shares of Common Stock outstanding immediately
prior to such Change of Shares, multiplied by the Purchase Price in
effect immediately prior to such Change of Shares and (b) the
consideration, if any, received by the Company upon such sale,
issuance, subdivision or combination, by (ii) the total number of shares
of Common Stock outstanding immediately after such Change of
Shares; provided, however, that in no event shall the Purchase Price
be adjusted pursuant to this computation to an amount in excess of the
Purchase Price in effect immediately prior to such computation,
except in the case of a combination of outstanding shares of Common
Stock.
For the purposes of any adjustment to be made in accordance
with this Section 8(a), the following provisions shall be applicable:
(A) In case of the issuance or sale of shares of Common
Stock (or of other securities deemed hereunder to involve the issuance
or sale of shares of Common Stock) for a consideration part or all of
which shall be cash, the amount of the cash portion of the
consideration therefor deemed to have been received by the Company
shall be (i) the subscription price, if shares of Common Stock are
offered by the Company for subscription, or (ii) the public offering
price (before deducting therefrom any compensation paid or discount
allowed in the sale, underwriting or purchase thereof by underwriters
or dealers or others performing similar services, or any expenses
incurred in connection therewith), if such securities are sold to
underwriters or dealers for public offering without a subscription
offering, or (iii) the gross amount of cash actually received by the
Company for such securities, in any other case, in each case, without
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deduction for any expenses incurred by the Company in connection
with such transaction.
(B) In case of the issuance or sale (other than as a dividend or
other distribution on any stock of the Company) of shares of Common
Stock (or of other securities deemed hereunder to involve the issuance
or sale of shares of Common Stock) for a consideration part or all of
which shall be other than cash, the amount of the consideration
therefor other than cash deemed to have been received by the
Company shall be the value of such consideration as determined in
good faith by the Board of Directors of the Company on the basis of
a record of values of similar property or services.
(C) Shares of Common Stock issuable by way of dividend or
other distribution on any stock of the Company shall be deemed to
have been issued immediately after the opening of business on the day
following the record date for the determination of shareholders
entitled to receive such dividend or other distribution and shall be
deemed to have been issued without consideration.
(D) The reclassification of securities of the Company other
than shares of Common Stock into securities including shares of
Common Stock shall be deemed to involve the issuance of such shares
of Common Stock for a consideration other than cash immediately
prior to the close of business on the date fixed for the determination
of security holders entitled to receive such shares, and the value of the
consideration allocable to such shares of Common Stock shall be
determined as provided in subsection (B) of this Section 8(a).
(E) The number of shares of Common Stock at any time
outstanding shall be deemed to include the aggregate maximum
number of shares issuable (subject to readjustment upon the actual
issuance thereof) upon the exercise of options, rights or warrants and
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upon the conversion or exchange of convertible or exchangeable
securities.
(ii) Upon each adjustment of the Purchase Price pursuant to
this Section 8, the number of shares of Common Stock purchasable
upon the exercise of each Warrant shall be the number derived by
multiplying the number of shares of Common Stock purchasable
immediately prior to such adjustment by the Purchase Price in effect
prior to such adjustment and dividing the product so obtained by the
applicable adjusted Purchase Price.
(b) In case the Company shall at any time after the date hereof
issue options, rights or warrants to subscribe for shares of Common
Stock, or issue any securities convertible into or exchangeable for
shares of Common Stock, for a consideration per share (determined
as provided in Section 8(a)(i) and as provided below) less than the
Fair Market Value in effect immediately prior to the issuance of such
options, rights or warrants, or such convertible or exchangeable
securities, or without consideration (including the issuance of any such
securities by way of dividend or other distribution), the Purchase Price
for the Warrants (whether or not the same shall be issued and
outstanding) in effect immediately prior to the issuance of such
options, rights or warrants, or such convertible or exchangeable
securities, as the case may be, shall be reduced to a price determined
by making the computation in accordance with the provisions of
Section 8(a)(i) hereof, provided that:
(A) The aggregate maximum number of shares of Common
Stock, as the case may be, issuable or that may become issuable under
such options, rights or warrants (assuming exercise in full even if not
then currently exercisable or currently exercisable in full) shall be
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deemed to be issued and outstanding at the time such options, rights
or warrants were issued, for a consideration equal to the minimum
purchase price per share provided for in such options, rights or
warrants at the time of issuance, plus the consideration, if any,
received by the Company for such options, rights or warrants;
provided, however, that upon the expiration or other termination of
such options, rights or warrants, if any thereof shall not have been
exercised, the number of shares of Common Stock deemed to be
issued and outstanding pursuant to this subsection (A) (and for the
purposes of subsection (E) of Section 8(a)(i) hereof) shall be reduced
by the number of shares as to which options, warrants and/or rights
shall have expired, and such number of shares shall no longer be
deemed to be issued and outstanding, and the Purchase Price then in
effect shall forthwith be readjusted and thereafter be the price that it
would have been had adjustment been made on the basis of the
issuance only of the shares actually issued plus the shares remaining
issuable upon the exercise of those options, rights or warrants as to
which the exercise rights shall not have expired or terminated
unexercised.
(B) The aggregate maximum number of shares of Common
Stock issuable or that may become issuable upon conversion or
exchange of any convertible or exchangeable securities (assuming
conversion or exchange in full even if not then currently convertible
or exchangeable in full) shall be deemed to be issued and outstanding
at the time of issuance of such securities, for a consideration equal to
the consideration received by the Company for such securities, plus
the minimum consideration, if any, receivable by the Company upon
the conversion or exchange thereof; provided, however, that upon the
termination of the right to convert or exchange such convertible or
19
exchangeable securities (whether by reason of redemption or
otherwise), the number of shares of Common Stock deemed to be
issued and outstanding pursuant to this subsection (B) (and for the
purposes of subsection (E) of Section 8(a)(i) hereof) shall be reduced
by the number of shares as to which the conversion or exchange rights
shall have expired or terminated unexercised, and such number of
shares shall no longer be deemed to be issued and outstanding, and the
Purchase Price then in effect shall forthwith be readjusted and
thereafter be the price that it would have been had adjustment been
made on the basis of the issuance only of the shares actually issued
plus the shares remaining issuable upon conversion or exchange of
those convertible or exchangeable securities as to which the
conversion or exchange rights shall not have expired or terminated
unexercised.
(C) If any change shall occur in the price per share provided
for in any of the options, rights or warrants referred to in subsection
(A) of this Section 8(b), or in the price per share or ratio at which the
securities referred to in subsection (B) of this Section 8(b) are
convertible or exchangeable, such options, rights or warrants or
conversion or exchange rights, as the case may be, to the extent not
theretofore exercised, shall be deemed to have expired or terminated
on the date when such price change became effective in respect of
shares not theretofore issued pursuant to the exercise or conversion
or exchange thereof, and the Company shall be deemed to have issued
upon such date new options, rights or warrants or convertible or
exchangeable securities.
(c) In case of any reclassification or change of outstanding
shares of Common Stock issuable upon exercise of the Warrants
(other than a change in par value, or from par value to no par value,
20
or from no par value to par value or as a result of a subdivision or
combination), or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with
a Subsidiary in which merger the Company is the continuing
corporation and which does not result in any reclassification or change
of the then outstanding shares of Common Stock or other capital
stock issuable upon exercise of the Warrants (other than a change in
par value, or from par value to no par value, or from no par value to
par value or as a result of subdivision or combination)) 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, then, as a
condition of such reclassification, change, consolidation, merger, sale
or conveyance, the Company, or such successor or purchasing
corporation, as the case may be, shall make lawful and adequate
provision whereby the Registered Holder of each Warrant then
outstanding shall have the right thereafter to receive on exercise of
such Warrant the kind and amount of securities and property
receivable upon such reclassification, change, consolidation, merger,
sale or conveyance by a holder of the number of securities issuable
upon exercise of such Warrant immediately prior to such
reclassification, change, consolidation, merger, sale or conveyance and
shall forthwith file at the Corporate Office of the Warrant Agent a
statement signed by its President or a Vice President and by its
Treasurer or an Assistant Treasurer or its Secretary or an Assistant
Secretary evidencing such provision. Such provisions shall include
provision for adjustments which shall be as nearly equivalent as may
be practicable to the adjustments provided for in Section 8(a) and (b).
The above provisions of this Section 8(c) shall similarly apply to
21
successive reclassifications and changes of shares of Common Stock
and to successive consolidations, mergers, sales or conveyances.
(d) Irrespective of any adjustments or changes in the Purchase
Price or the number of shares of Common Stock purchasable upon
exercise of the Warrants, the Warrant Certificates theretofore and
thereafter issued shall, unless the Company shall exercise its option to
issue new Warrant Certificates pursuant to Section 2(e) hereof,
continue to express the Purchase Price per share and the number of
shares purchasable thereunder as the Purchase Price per share and the
number of shares purchasable thereunder were expressed in the
Warrant Certificates when the same were originally issued.
(e) After each adjustment of the Purchase Price pursuant to
this Section 8, the Company will promptly prepare a certificate signed
by the Chairman or President, and by the Treasurer or an Assistant
Treasurer or the Secretary or an Assistant Secretary, of the Company
setting forth: (i) the Purchase Price as so adjusted, (ii) the number of
shares of Common Stock purchasable upon exercise of each Warrant,
after such adjustment, and (iii) a brief statement of the facts
accounting for such adjustment. The Company will promptly file such
certificate with the Warrant Agent and cause a brief summary thereof
to be sent by ordinary first class mail to each Registered Holder at his
last address as it shall appear on the registry books of the Warrant
Agent. No failure to mail such notice nor any defect therein or in the
mailing thereof shall affect the validity thereof except as the holder to
whom the Company failed to mail such notice, or except as to the
holder whose notice was defective. The affidavit of an officer of the
Warrant Agent or the Secretary or an Assistant Secretary of the
Company that such notice has been mailed shall, in the absence of
fraud, be prima facie evidence of the facts stated therein.
22
(f) No adjustment of the Purchase Price shall be made as a
result of or in connection with (A) the issuance of shares of Common
Stock underlying the Warrants or the units issuable upon exercise of
the Underwriter's Warrants pursuant to the Underwriter's Warrant
Agreement, or (B) the issuance or sale of shares of Common Stock if
the amount of said adjustment shall be less than $.10, provided,
however, that in such case, any adjustment that would otherwise be
required then to be made shall be carried forward and shall be made
at the time of and together with the next subsequent adjustment that
shall amount, together with any adjustment so carried forward, to at
least $.10. In addition, Registered Holders shall not be entitled to
cash dividends paid by the Company prior to the exercise of any
Warrant or Warrants held by them.
(g) "Fair Market Value" shall mean the value of a share of
Common Stock as determined in accordance with the following
provisions:
(1) If the Common Stock is listed or admitted to
unlisted trading privileges on the NYSE or the AMEX or is traded on
the Nasdaq/NM, the Fair Market Value of a share of Common Stock
shall be equal to the average of the closing sale price of the Common
Stock during the thirty (30) trading days immediately preceding the
date of the event which requires the determination of Fair Market
Value on whichever of such exchanges or Nasdaq/NM had the total
highest daily trading volume for the Common Stock during such thirty
(30) day trading period.
(2) If the Common Stock is not listed or admitted to
unlisted trading privileges on either the NYSE or the AMEX and is
not traded on Nasdaq/NM, but is quoted or reported on Nasdaq, the
Fair Market Value of a share of Common Stock shall be the average
23
of the last reported closing bid and asked prices (or the last sale price,
if then reported on Nasdaq) of the Common Stock
during the thirty (30) trading days immediately preceding the date of event
which requires the
determination of Fair Market Value.
(3) If the Common Stock is not listed or admitted to
unlisted trading privileges on
either of the NYSE or the AMEX and is not traded on Nasdaq/NM or quoted or
reported on Nasdaq,
but is listed or admitted to unlisted trading privileges on the BSE or another
national securities
exchange (other than the NYSE or the AMEX), the Fair Market Value of a share of
Common Stock
shall be the average of the closing sale price of the Common Stock during the
thirty (30) trading days
immediately preceding the date of the event which requires the determination of
Fair Market Value.
(4) If the Common Stock is not listed or admitted to
unlisted trading privileges on
any national securities exchange, or listed for trading on Nasdaq/NM or quoted
or reported on
Nasdaq, but is traded in the over-the-counter market, the Fair Market Value of
a share of Common
Stock shall be the average of the average of the last reported bid and asked
prices of the Common
Stock reported by the National Quotation Bureau, Inc. for the thirty (30)
trading days immediately
preceding the date of the event which requires the determination of Fair
Market Value.
(5) If the Common Stock is not listed or admitted to
unlisted trading privileges on
any national securities exchange, or listed for trading on Nasdaq/NM or
quoted or reported on
Nasdaq, and bid and asked prices of the Common Stock are not reported by the
National Quotation
Bureau, Inc., the Fair Market Value of a share of Common Stock shall be an
amount, not less than
the book value thereof as of the end of the most recently completed fiscal
quarter of the company
ending prior to the date requiring a determination of fair market value,
determined in accordance with
general accepted accounting principles, consistently applied.
SECTION 9. Redemption.
(a) Commencing on the Initial Warrant Redemption Date, the Company
may, on 30 days'
prior written notice redeem all the Warrants, other than the Warrants
underlying the Underwriter's
24
Warrants which shall not be redeemable, at ten cents ($.10) per Warrant,
provided, however, that
before any such call for redemption of Class A Warrants can take place the
closing sale price of the
Common Stock as quoted on the principal market on which such shares shall then
be trading, shall
have, for only twenty (20) trading days within a period of thirty (30)
consecutive trading days ending
on the fifth (5th) day prior to the date on which the notice contemplated by
(b) and (c) below is given,
equalled or exceeded $6.25 per share (subject to adjustment in the event of
any stock splits or other
similar events as provided in Section 8 hereof), and before any such call for
redemption of Class B
Warrants can take place the closing sale price of the Common Stock as quoted
on the principal
market on which such shares shall then be trading, shall have, for only twenty
(20) trading days within
a period of thirty (30) consecutive trading days ending on the fifth (5th) day
prior to the date on
which the notice contemplated by (b) and (c) below is given, equalled or
exceeded $7.25 per share
(subject to adjustment in the event of any stock splits or other similar
events as provided in Section
8 hereof).
(b) In case the Company shall exercise its right to redeem all of
the Class A or Class B
Warrants so redeemable, it shall give or cause notice to such effect to be
given to the Underwriter
in the same manner that notice is required to be given by the Underwriter's
Warrant Agreement. The
Underwriter may, at its option, solicit exercises of the Warrants. In the
event that the Underwriter
does not commence solicitation of exercises of the Warrants within thirty (30)
days of notice from
the Company, the Company may give notice of redemption to the Registered
Holders of the Warrants
by mailing to such Registered Holders a notice of redemption, first class,
postage prepaid, at their last
address as shall appear on the records of the Warrant Agent. Any notice mailed
in the manner
provided herein shall be conclusively presumed to have been duly given whether
or not the Registered
Holder receives such notice. Not less than five business days prior to the
mailing to the Registered
Holders of the Warrants of the notice of redemption, the Company shall deliver
or cause to be
delivered to the Underwriter a similar notice telephonically and confirmed in
writing together with
a list of the Registered Holders (including their respective addresses and
number of Warrants
beneficially owned) to whom such notice of redemption has been or will be
given.
(c) The notice of redemption shall specify (i) the redemption price,
(ii) the date fixed for
redemption, which shall in no event be less than thirty (30) days after the
date of mailing of such
25
notice, (iii) the place where the Warrant Certificate shall be delivered and
the redemption price shall
be paid, (iv) that the Underwriter is the Company's warrant solicitation agent
and may receive the
commission contemplated by Section 4(b) hereof, and (v) that the right to
exercise the Warrant shall
terminate at 5:00 p.m. (New York time) on the business day immediately
preceding the date fixed for
redemption. The date fixed for the redemption of the Warrants shall be the
Redemption Date. No
failure to mail such notice nor any defect therein or in the mailing thereof
shall affect the validity of
the proceedings for such redemption except as to a holder (a) to whom notice
was not mailed or (b)
whose notice was defective. An affidavit of the Warrant Agent or the Secretary
or Assistant
Secretary of the Company that notice of redemption has been mailed shall, in
the absence of fraud,
be prima facie evidence of the facts stated therein.
(d) Any right to exercise a Warrant shall terminate at 5:00 p.m.
(New York time) on
the business day immediately preceding the Redemption Date. The redemption
price payable to the
Registered Holders shall be mailed to such persons at their addresses of
record.
(e) The Company shall indemnify the Underwriter and each person, if
any, who controls the
Underwriter within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act
against all loss, claim, damage, expense or liability (including all expenses
reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
any of them may
become subject under the Act, the Exchange Act or otherwise, arising from the
registration statement
or prospectus referred to in Section 5(b) hereof to the same extent and with
the same effect (including
the provisions regarding contribution) as the provisions pursuant to which the
Company has agreed
to indemnify the Underwriters contained in Section 7 of the Underwriting
Agreement.
(f) Five business days prior to the Redemption Date, the Company
shall furnish to the
Underwriter (i) an opinion of counsel to the Company, dated such date and
addressed to Underwriter,
and (ii) a "cold comfort" letter dated such date addressed to the Underwriter,
signed by the
independent public accountants who have issued a report on the Company's
financial statements
included in such registration statement, in each case covering substantially
the same matters with
respect to such registration statement (and the prospectus included therein)
and, in the case of such
accountants' letter, with respect to events subsequent to the date of such
financial statements, as are
26
customarily covered in opinions of issuer's counsel and in accountants' letters
delivered to
underwriters in underwritten public offerings of securities.
(g) The Company shall as soon as practicable after the Redemption
Date, and in any event
within 15 months thereafter, make "generally available to its security holders"
(within the meaning
of Rule 158 under the Act) an earnings statement (which need not be audited)
complying with Section
11(a) of the Act and covering a period of at least 12 consecutive months
beginning after the
Redemption Date.
(h) The Company shall deliver within five business days prior to the
Redemption Date copies
of all correspondence between the Commission and the Company, its counsel or
auditors and all
memoranda relating to discussions with the Commission or its staff with respect
to such registration
statement and permit the Underwriter to do such investigation, upon reasonable
advance notice, with
respect to information contained in or omitted from the registration statement
as it deems reasonably
necessary to comply with applicable securities laws or rules of the NASD. Such
investigation shall
include access to books, records and properties and opportunities to discuss
the business of the
Company with its officers and independent auditors, all to such reasonable
extent and at such
reasonable times and as often as the Underwriter shall reasonably request.
SECTION 10. Concerning the Warrant Agent.
(a) The Warrant Agent acts hereunder as agent and in a ministerial
capacity for the Company
and the Underwriter, and its duties shall be determined solely by the
provisions hereof. The Warrant
Agent shall not, by issuing and delivering Warrant Certificates or by any
other act hereunder, be
deemed to make any representations as to the validity or value or authorization
of the Warrant
Certificates or the Warrants represented thereby or of any securities or other
property delivered upon
exercise of any Warrant or whether any stock issued upon exercise of any
Warrant is fully paid and
nonassessable.
(b) The Warrant Agent shall not at any time be under any duty or
responsibility to any holder
of Warrant Certificates to make or cause to be made any adjustment of the
Purchase Price provided
in this Agreement, or to determine whether any fact exists which may require
any such adjustment,
or with respect to the nature or extent of any such adjustment, when made, or
with respect to the
4736-2
27
method employed in making the same. It shall not (i) be liable for any recital
or statement of fact
contained herein or for any action taken, suffered or omitted by it in reliance
on any Warrant Certificate or other document or instrument believed by it in
good faith to be genuine and to have been signed or presented by the proper
party or parties, (ii) be responsible for any failure on the part of the Company
to comply with any of its covenants and obligations contained in this Agreement
or in any Warrant Certificate, or (iii) be liable for any act or omission in
connection with this Agreement except for its own gross negligence or willful
misconduct. (c) The Warrant Agent may at any time consult with counsel
satisfactory to it (who may be counsel for the Company) and shall incur no
liability or responsibility for any action taken, suffered or omitted by it in
good faith in accordance with the opinion or advice of such counsel. (d) Any
notice, statement, instruction, request, direction, order or demand of the
Company shall be sufficiently evidenced by an instrument signed by the Chairman
of the Board of Directors, President or any Vice President (unless other
evidence in respect thereof is herein specifically prescribed). The Warrant
Agent shall not be liable for any action taken, suffered or omitted by it in
accordance with such notice, statement, instruction, request, direction, order
or demand. (e) The Company agrees to pay the Warrant Agent reasonable
compensation for its services hereunder and to reimburse it for its reasonable
expenses hereunder; the Company further agrees to indemnify the Warrant Agent
and save it harmless against any and all losses, expenses and liabilities,
including judgments, costs and counsel fees, for anything done or omitted by the
Warrant Agent in the execution of its duties and powers hereunder except losses,
expenses and liabilities arising as a result of the Warrant Agent's gross
negligence or willful misconduct. (f) The Warrant Agent may resign its duties
and be discharged from all further duties and liabilities hereunder (except
liabilities arising as a result of the Warrant Agent's own gross negligence or
willful misconduct), after giving 30 days' prior written notice to the Company.
At least 15 days prior to the date such resignation is to become effective, the
Warrant Agent shall cause a copy of such notice of resignation to be mailed to
the Registered Holder of each Warrant Certificate at the Company's expense. Upon
such resignation the Company shall appoint in writing a new warrant agent. If
the Company shall fail to make such appointment within a period of 30 days after
it has been notified in writing of such resignation by the resigning Warrant
Agent, then the Registered Holder
of any Warrant Certificate may apply
to any court of competent jurisdiction for the appointment of a new warrant
agent. Any new warrant agent, whether appointed by the Company or by such a
court, shall be a bank or trust company having a capital and surplus, as shown
by its last published report to its stockholders, of not less than $10,000,000
or a stock transfer company doing business in Massachusetts or New York. After
acceptance in writing of such appointment by the new warrant agent is received
by the Company, such new warrant agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named herein as
the warrant agent, without any further assurance, conveyance, act or deed; but
if for any reason it shall be necessary or expedient to execute and deliver any
further assurance, conveyance, act or deed, the same shall be done at the
expense of the Company and shall be legally and validly executed and delivered
by the resigning Warrant Agent. Not later than the effective date of any such
appointment the Company shall file notice thereof with the resigning Warrant
Agent and shall forthwith cause a copy of such notice to be mailed to the
Registered Holder of each Warrant Certificate. (g) Any corporation into which
the Warrant Agent or any new warrant agent may be converted or merged, any
corporation resulting from any consolidation to which the Warrant Agent or any
new warrant agent shall be a party, or any corporation succeeding to the
corporate trust business of the Warrant Agent or any new warrant agent shall be
a successor warrant agent under this Agreement without any further act, provided
that such corporation is eligible for appointment as successor to the Warrant
Agent under the provisions of the preceding paragraph. Any such successor
warrant agent shall promptly cause notice of its succession as warrant agent to
be mailed to the Company and to the Registered Holders of each Warrant
Certificate. (h) The Warrant Agent, its subsidiaries and affiliates, and any of
its or their officers or directors, may buy and hold or sell Warrants or other
securities of the Company and otherwise deal with the Company in the same manner
and to the same extent and with like effect as though it were not Warrant Agent.
Nothing herein shall preclude the Warrant Agent from acting in any other
capacity for the Company or for any other legal entity. (i) The Warrant Agent
shall retain for a period of two years from the date of exercise any Warrant
Certificate received by it upon such exercise.
29
SECTION 11. Modification of Agreement. The Warrant Agent and the Company may by
supplemental agreement make any changes or corrections in this Agreement (i)
that they shall deem appropriate to cure any ambiguity or to correct any
defective or inconsistent provision or manifest mistake or error herein
contained; (ii) to reflect an increase in the number of Warrants which are to be
governed by this Agreement resulting from a subsequent public offering of
Company securities which includes warrants having the same terms and conditions
as the Warrants originally covered by or subsequently added to this Agreement
under this Section 11; or (iii) that they may deem necessary or desirable and
which shall not adversely affect the interests of the holders of Warrant
Certificates; provided, however, that this Agreement shall not otherwise be
modified, supplemented or altered in any respect except with the consent in
writing of the Registered Holders representing not less that 66-2/3% of the
Warrants then outstanding (including, for this purpose Warrants issuable to the
Underwriter pursuant to the Underwriter's Warrants, whether or not then
outstanding); provided, further, that no change in the number or nature of the
securities purchasable upon the exercise of any Warrant, or to increase the
Purchase Price therefor, shall be made without the consent in writing of the
Registered Holder of the Warrant Certificate, other than such changes as are
specifically prescribed by this Agreement as originally executed. In addition,
this Agreement may not be modified, amended or supplemented without the prior
written consent of the Underwriter, other than to cure any ambiguity or to
correct any provision which is inconsistent with any other provision of this
Agreement or to make any such change that is necessary or desirable and which
shall not adversely affect the interests of the Underwriter and except as may be
required by law. SECTION 12. Notices. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed to have been
made when delivered or mailed first-class postage prepaid, or delivered to a
telegraph office for transmission if to the Registered Holder of a Warrant
Certificate, at the address of such holder as shown on the registry books
maintained by the Warrant Agent; if to the Company at Genisys Reservation
Systems, Inc., 0000 Xxxxxx Xxxxxx, 0xx Xxxxx, Xxxxx, Xxx Xxxxxx 00000,
Attention: Xxxxxx Xxxxxxx, President, or at such other address as may have been
furnished
30
to the Warrant Agent in writing by the company; and if to the Warrant Agent, at
its Corporate Office. Copies of any notice delivered pursuant to this Agreement
shall be delivered to X.X. Xxxxx at X.X. Xxxxx & Co., Inc., 000 Xxxxx Xxxxxx,
0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx Xxxxxxx, with a copy to
Scheichet & Xxxxx, P.C., 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxxx X. Xxxxx, or at such other address as may have been furnished
to the Company and the Warrant Agent in writing. SECTION 13. Construction. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York without giving effect to conflicts of laws. SECTION 14.
Binding Effect. This Agreement shall be binding upon and inure to the benefit of
the Company, the Warrant Agent and their respective successors and assigns and
the holders from time to time of Warrant Certificates or any of them. Except as
hereinafter stated, nothing in this Agreement is intended or shall be construed
to confer upon any other person any right, remedy or claim or to impose upon any
other person any duty, liability or obligation. The Underwriters (as defined in
the Underwriting Agreement) are, and shall at all times irrevocably be deemed to
be, third-party beneficiaries of this Agreement, with full power, authority and
standing to enforce the rights granted to it hereunder. SECTION 15.
Counterparts. This Agreement may be executed in several counterparts, which
taken together shall constitute a single document. IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed as of the first
date first above written. GENISYS RESERVATION SYSTEMS, INC. CONTINENTAL STOCK
TRANSFER AND TRUST COMPANY
31
By: By:
Xxxxxx Xxxxxxx, President
32
EXHIBIT A
No. Class A W VOID AFTER ____________, 2001 ____________ CLASS A WARRANTS CLASS
A REDEEMABLE WARRANT CERTIFICATE TO PURCHASE ONE SHARE OF COMMON STOCK GENISYS
RESERVATION SYSTEMS, INC. CUSIP __________ THIS CERTIFIES THAT, FOR VALUE
RECEIVED or registered assigns (the "Registered Holder") is the owner of the
number of Redeemable Warrants (the "Warrants") specified above. Each Warrant
initially entitles the Registered Holder to purchase, subject to the terms and
conditions set forth in this Certificate and the Warrant Agreement (as
hereinafter defined), one fully paid and nonassessable share of Common Stock,
$.0001 par value, of Genysis Reservation Systems, Inc., a New Jersey
corporation (the
"Company"), at any time between , 1997 (the "Initial Warrant Exercise Date"),
and the Expiration Date (as hereinafter defined) upon the presentation and
surrender of this Warrant Certificate with the Subscription Form on the reverse
hereof duly executed, at the corporate office of Continental Stock Transfer and
Trust Company, 0 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, as Warrant Agent, or its
successor (the "Warrant Agent"), accompanied by payment of $5.75 subject to
adjustment (the "Purchase Price"), in lawful money of the United States of
America in cash or by check made payable to the Warrant Agent for the account of
the Company. This Warrant Certificate and each Warrant represented hereby are
issued pursuant to and are subject in all respects to the terms and conditions
set forth in the Redeemable Warrant Agreement (the "Warrant Agreement"), dated
________________, 1996, by and between the Company and the Warrant Agent. In the
event of certain contingencies provided for in the Warrant Agreement, the
Purchase Price and the number of shares of Common Stock subject to purchase upon
the exercise of each Warrant represented hereby are subject to modification or
adjustment. Each Warrant represented hereby is exercisable at the option of the
Registered Holder, but no fractional interests will be issued. In the case of
the exercise of less than all the Warrant represented hereby, the Company shall
cancel this Warrant Certificate upon the surrender hereof and
33
shall execute and deliver a new Warrant Certificate or Warrant Certificates of
like tenor, which the Warrant Agent shall countersign, for the balance of such
Warrants. The term "Expiration Date" shall mean 5:00 p.m. (New York time) on ,
2001. If each such date shall in the State of New York be a holiday or a day on
which the banks are authorized to close, then the Expiration Date shall mean
5:00 p.m. (New York time) the next following day which in the State of New York
is not a holiday or a day on which banks are authorized to close. The Company
shall not be obligated to deliver any securities pursuant to the exercise of
this Warrant unless a registration statement under the Securities Act of 1933,
as amended (the "Act), with respect to such securities is effective or an
exemption thereunder is available. The Company has covenanted and agreed that it
will file a registration statement under the Federal securities laws, use its
best efforts to cause the same to become effective, use its best efforts to keep
such registration statement current, if required under the Act, while any of the
Warrants are outstanding, and deliver a prospectus which complies with Section
10(a)(3) of the Act to the Registered Holder exercising this Warrant. This
Warrant shall not be exercisable by a Registered Holder in any state where such
exercise would be unlawful. This Warrant Certificate is exchangeable, upon the
surrender hereof by the Registered Holder at the corporate office of the Warrant
Agent, for a new Warrant Certificate or Warrant Certificates of like tenor
representing an equal aggregate number of Warrants, each of such new Warrant
Certificates to represent such number of Warrants as shall be designated by such
Registered Holder at the time of such surrender. Upon due presentment and
payment of any tax or other charge imposed in connection therewith or incident
thereto, for registration of transfer of this Warrant Certificate at such
office, a new Warrant Certificate of Warrant Certificates representing an equal
aggregate number of Warrants will be issued to the transferee in exchange
therefor, subject to the limitations provided in the Warrant Agreement. Prior to
the exercise of any Warrant represented hereby, the Registered Holder shall not
be entitled to any rights of a stockholder of the Company, including, without
limitation, the right to vote or to receive dividends or other distributions,
and shall not be entitled to receive any notice of any proceedings of the
Company, except as provided in the Warrant Agreement. Subject to the provisions
of the Warrant Agreement, this Warrant may be redeemed at the option of the
Company, at a redemption price of $.10 per Warrant, at any time commencing six
(6) months after the Initial Warrant Exercise Date, provided that (i) the
closing bid price for the Common Stock is reported by The Nasdaq Stock Market,
Inc. ("Nasdaq"), if the Common Stock is then traded in the over-the-counter
market or (ii) the closing sale price, if the Common Stock is then traded on
Nasdaq/NM or a national securities exchange, shall have equalled or exceeded for
any twenty (20) trading days within a period of thirty (30) consecutive trading
days ending on the fifth (5th) day prior to the Notice of Redemption, as defined
below, $6.25 per share (subject to adjustment in the event of any stock splits
or other similar events). Notice of redemption (the "Notice of Redemption")
shall be given not later than the thirtieth day before the date fixed for
redemption, all as provided in the
Warrant Agreement. On and after the date fixed for redemption, the Registered
Holder shall have no rights with respect to the Warrants except to receive the
$.10 per Warrant upon surrender of this Warrant Certificate. Under certain
circumstances, X.X. Xxxxx & Co., Inc. collectively shall be entitled to receive
an aggregate of four percent (4%) of the Purchase Price of the Warrants
represented hereby. Prior to due presentment for registration of transfer
hereof, the Company and the Warrant Agent may deem and treat the Registered
Holder as the absolute owner hereof and of each Warrant represented hereby
(notwithstanding any notations of ownership or writing hereon made by anyone
other than a duly authorized officer of the Company or the Warrant Agent) for
all purposes and shall not be affected by any notice to the contrary, except as
provided in the Warrant Agreement. This Warrant Certificate shall be governed by
and construed in accordance with the laws of the State of New York without
giving effect to conflicts of laws. This Warrant Certificate is not valid unless
countersigned by the Warrant Agent. IN WITNESS WHEREOF, the Company has caused
this Warrant Certificate to be duly executed, manually or in facsimile by two of
its officers thereunto duly authorized and a facsimile of its corporate seal to
be imprinted hereon.
Dated: ________________, 1996
[SEAL] GENISYS RESERVATION SYSTEMS, INC.
By: Xxxxxx Xxxxxxx, President By:
Xxxx Xxxxx, Secretary
COUNTERSIGNED: CONTINENTAL STOCK TRANSFER AND TRUST COMPANY
as Warrant Agent By: _____________________
Name: _____________________ Title: ____________________
35
SUBSCRIPTION FORM
To Be Executed by the Registered Holder
in Order to Exercise Warrants
The undersigned Registered Holder hereby irrevocably elects to exercise Warrants
represented by this Warrant Certificate, and to purchase the securities issuable
upon the exercise of such Warrants, and requests that certificates for such
securities shall be issued in name of PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER (please print or type name and address) and be delivered to
(please print or type name and address) and if such number of Warrants shall not
be all the Warrants evidenced by this Warrant Certificate, that a new Warrant
Certificate for the balance of such Warrants be registered in the name of, and
delivered to, the Registered Holder at the address stated below.
4736-2
36
IMPORTANT: PLEASE COMPLETE THE FOLLOWING:
1. The exercise of this Warrant was
solicited by X.X. Xxxxx & Co., Inc.
2. The exercise of this Warrant was not
solicited.
Dated: X
Address Social Security or Taxpayer Identification Number Signature Guaranteed
37
ASSIGNMENT
To Be Executed by the Registered Holder in Order to Assign Warrants FOR
VALUE RECEIVED, _________________________ hereby sells, assigns and
transfers unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
(please print or type name and address) ___________________________ of the
Warrants represented by this Warrant Certificate, and hereby irrevocably
constitutes and appoints ____________________ Attorney to transfer this
Warrant Certificate on the of the Company, with full power of substitution
in the premises. Dated: X Signature Guaranteed THE SIGNATURE TO THE
ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE NAME AS WRITTEN
UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER AND MUST BE GUARANTEED
BY A COMMERCIAL BANK OR TRUST COMPANY OR A MEMBER FIRM OF THE CONTINENTAL
STOCK EXCHANGE, PACIFIC STOCK EXCHANGE, MIDWEST
STOCK EXCHANGE OR BOSTON STOCK EXCHANGE.
38
EXHIBIT B
No. Class B W VOID AFTER ____________, 2001 ____________ CLASS B WARRANTS
CLASS A REDEEMABLE WARRANT CERTIFICATE TO PURCHASE ONE SHARE OF COMMON
STOCK GENISYS RESERVATION SYSTEMS, INC. CUSIP __________ THIS CERTIFIES
THAT, FOR VALUE RECEIVED or registered assigns (the "Registered Holder") is
the owner of the number of Redeemable Warrants (the "Warrants") specified
above. Each Warrant initially entitles the Registered Holder to purchase,
subject to the terms and conditions set forth in this Certificate and the
Warrant Agreement (as hereinafter defined), one fully paid and
nonassessable share of Common Stock, $.0001 par value, of Genysis
Reservation Systems, Inc., a New Jersey corporation (the "Company"),
at any time between,
1997 (the "Initial Warrant Exercise Date"), and the Expiration Date (as
hereinafter defined) upon the presentation and surrender of this Warrant
Certificate with the Subscription Form on the reverse hereof duly executed,
at the corporate office of Continental Stock Transfer and Trust Company, 0
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, as Warrant Agent, or its successor (the
"Warrant Agent"), accompanied by payment of $6.75 subject to adjustment
(the "Purchase Price"), in lawful money of the United States of America in
cash or by check made payable to the Warrant Agent for the account of the
Company. This Warrant Certificate and each Warrant represented hereby are
issued pursuant to and are subject in all respects to the terms and
conditions set forth in the Redeemable Warrant Agreement (the "Warrant
Agreement"), dated ________________, 1996, by and between the Company and
the Warrant Agent. In the event of certain contingencies provided for in
the Warrant Agreement, the Purchase Price and the number of shares of
Common Stock subject to purchase upon the exercise of each Warrant
represented hereby are subject to modification or adjustment. Each Warrant
represented hereby is exercisable at the option of the Registered Holder,
but no fractional interests will be issued. In the case of the exercise of
less than all the Warrant represented hereby, the Company shall cancel this
Warrant Certificate upon the surrender hereof and
39
shall execute and deliver a new Warrant Certificate or Warrant Certificates
of like tenor, which the Warrant Agent shall countersign, for the balance
of such Warrants. The term "Expiration Date" shall mean 5:00 p.m. (New York
time) on , 2001. If each such date shall in the State of New York be a
holiday or a day on which the banks are authorized to close, then the
Expiration Date shall mean 5:00 p.m. (New York time) the next following day
which in the State of New York is not a holiday or a day on which banks are
authorized to close. The Company shall not be obligated to deliver any
securities pursuant to the exercise of this Warrant unless a registration
statement under the Securities Act of 1933, as amended (the "Act), with
respect to such securities is effective or an exemption thereunder is
available. The Company has covenanted and agreed that it will file a
registration statement under the Federal securities laws, use its best
efforts to cause the same to become effective, use its best efforts to keep
such registration statement current, if required under the Act, while any
of the Warrants are outstanding, and deliver a prospectus which complies
with Section 10(a)(3) of the Act to the Registered Holder exercising this
Warrant. This Warrant shall not be exercisable by a Registered Holder in
any state where such exercise would be unlawful. This Warrant Certificate
is exchangeable, upon the surrender hereof by the Registered Holder at the
corporate office of the Warrant Agent, for a new Warrant Certificate or
Warrant Certificates of like tenor representing an equal aggregate number
of Warrants, each of such new Warrant Certificates to represent such number
of Warrants as shall be designated by such Registered Holder at the time of
such surrender. Upon due presentment and payment of any tax or other charge
imposed in connection therewith or incident thereto, for registration of
transfer of this Warrant Certificate at such office, a new Warrant
Certificate of Warrant Certificates representing an equal aggregate number
of Warrants will be issued to the transferee in exchange therefor, subject
to the limitations provided in the Warrant Agreement. Prior to the exercise
of any Warrant represented hereby, the Registered Holder shall not be
entitled to any rights of a stockholder of the Company, including, without
limitation, the right to vote or to receive dividends or other
distributions, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided in the Warrant Agreement.
Subject to the provisions of the Warrant Agreement, this Warrant may be
redeemed at the option of the Company, at a redemption price of $.10 per
Warrant, at any time commencing six (6) months after the Initial Warrant
Exercise Date, provided that (i) the closing bid price for the Common Stock
is reported by The Nasdaq Stock Market, Inc. ("Nasdaq"), if the Common
Stock is then traded in the over-the-counter market or (ii) the closing
sale price, if the Common Stock is then traded on Nasdaq/NM or a national
securities exchange, shall have equalled or exceeded for any twenty (20)
trading days within a period of thirty (30) consecutive trading days ending
on the fifth (5th) day prior to the Notice of Redemption, as defined below,
$7.25 per share (subject to adjustment in the event of any stock splits or
other similar events). Notice of redemption (the "Notice of Redemption")
shall be given not later than the thirtieth day before the date fixed for
redemption, all as provided in the
40
Warrant Agreement. On and after the date fixed for redemption, the
Registered Holder shall have no rights with respect to the Warrants except
to receive the $.10 per Warrant upon surrender of this Warrant Certificate.
Under certain circumstances, X.X. Xxxxx & Co., Inc. collectively shall be
entitled to receive an aggregate of four percent (4%) of the Purchase Price
of the Warrants represented hereby. Prior to due presentment for
registration of transfer hereof, the Company and the Warrant Agent may deem
and treat the Registered Holder as the absolute owner hereof and of each
Warrant represented hereby (notwithstanding any notations of ownership or
writing hereon made by anyone other than a duly authorized officer of the
Company or the Warrant Agent) for all purposes and shall not be affected by
any notice to the contrary, except as provided in the Warrant Agreement.
This Warrant Certificate shall be governed by and construed in accordance
with the laws of the State of New York without giving effect to conflicts
of laws. This Warrant Certificate is not valid unless countersigned by the
Warrant Agent. IN WITNESS WHEREOF, the Company has caused this Warrant
Certificate to be duly executed, manually or in facsimile by two of its
officers thereunto duly authorized and a facsimile of its corporate seal to
be imprinted hereon. Dated: ________________, 1996 [SEAL] GENISYS
RESERVATION SYSTEMS, INC. By: _________________________Joseph Xxxxxxx,
President By: _____________________________ Xxxx Xxxxx, Secretary
COUNTERSIGNED: CONTINENTAL STOCK TRANSFER AND TRUST COMPANY as Warrant
Agent By: _____________________ Name: _____________________ Title:
____________________
41
SUBSCRIPTION FORM
To Be Executed by the Registered Holder
in Order to Exercise Warrants
The undersigned Registered Holder hereby irrevocably elects to exercise
Warrants represented by this Warrant Certificate, and to purchase the
securities issuable upon the exercise of such Warrants, and requests that
certificates for such securities shall be issued in name of PLEASE INSERT
SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER (please print or type name and
address) and be delivered to (please print or type name and address) and if
such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, that a new Warrant Certificate for the balance of such
Warrants be registered in the name of, and delivered to, the Registered
Holder at the address stated below.
42
IMPORTANT: PLEASE COMPLETE THE FOLLOWING:
1. The exercise of this Warrant was
solicited by X.X. Xxxxx & Co., Inc.
2. The exercise of this Warrant was not
solicited.
Dated: X
Address Social Security or Taxpayer Identification Number Signature
Guaranteed
43
ASSIGNMENT
To Be Executed by the Registered Holder
in Order to Assign Warrants
FOR VALUE RECEIVED, _________________________ hereby sells, assigns and
transfers unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
(please print or type name and address) ___________________________ of the
Warrants represented by this Warrant Certificate, and hereby irrevocably
constitutes and appoints ____________________ Attorney to transfer this
Warrant Certificate on the of the Company, with full power of substitution
in the premises. Dated: X Signature Guaranteed THE SIGNATURE TO THE
ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE NAME AS WRITTEN
UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER AND MUST BE GUARANTEED
BY A COMMERCIAL BANK OR TRUST COMPANY OR A MEMBER FIRM OF THE CONTINENTAL
STOCK EXCHANGE, PACIFIC STOCK EXCHANGE, MIDWEST STOCK EXCHANGE OR BOSTON
STOCK EXCHANGE.
44
