Exhibit 4.4
WARRANT AGREEMENT
This WARRANT AGREEMENT (the "AGREEMENT") is entered into as of ___________,
2007, by and between Alpha Security Group Corporation (the "COMPANY"), a
Delaware corporation, with offices at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, and American Stock Transfer & Trust Company, a Delaware corporation, with
offices at 00 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "WARRANT AGENT").
WHEREAS, the Company is engaged in a public offering (the "PUBLIC
OFFERING") of 6,000,000 units (the "UNITS") of the Company (900,000 additional
Units if the Underwriters' Over-allotment Option is exercised in full), each
Unit consisting of one share of common stock, par value $.0001 per share (the
"COMMON STOCK") and one warrant (the "WARRANT") to purchase one share of Common
Stock, and, in connection therewith, has determined to issue and deliver up to
6,000,000 Warrants (the "PUBLIC WARRANTS") to public investors;
WHEREAS, the Company has heretofore engaged in a private offering (the
"PRIVATE OFFERING") of 3,200,000 warrants of the Company pursuant to a
Subscription Agreement, dated ___________, 2007 by and between the Company and
the investors named therein pursuant to which the Company shall issue and
deliver 3,200,000 Warrants (the "PRIVATE WARRANTS") to such investors;
WHEREAS, the Company has filed with the Securities and Exchange Commission
(the "SEC") a registration statement, No. 333-127999 on Form S-1 (the
"REGISTRATION STATEMENT") for the registration under the Securities Act of 1933,
as amended (the "ACT") of, among other securities, the Public Warrants and the
Common Stock issuable upon exercise of the Public Warrants;
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, exchange, redemption and exercise of the
Public Warrants and the Private Warrants (collectively, the "WARRANTS");
WHEREAS, the Company desires to provide for the form and provisions of the
Warrants, the terms upon which they shall be issued and exercised, and the
respective rights, limitation of rights, and immunities of the Company, the
Warrant Agent, and the holders of the Warrants; and
WHEREAS, all acts and things have been done and performed which are
necessary to make the Warrants, when executed on behalf of the Company and
countersigned by or on behalf of the Warrant Agent, as provided herein, the
valid, binding and legal obligations of the Company, and to authorize the
execution and delivery of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements herein contained,
the parties hereto agree as follows:
1. Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent
to act as warrant agent for the Company for the Warrants, and the Warrant Agent
hereby accepts such
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appointment and agrees to perform the same in accordance with the terms and
conditions set forth in this Agreement.
2. Warrants.
2.1. Form of Warrants. The Warrants shall be issued in registered form
only. The Public Warrants shall be in substantially the form of Exhibit A hereto
and the Private Warrants shall be in substantially the form of Exhibit B hereto,
the provisions of each of which are incorporated herein, and shall be signed by,
or bear the facsimile signature of, the Chief Executive Officer or President and
Chief Management Officer and Secretary or Assistant Secretary of the Company and
shall bear a facsimile of the Company's seal. In the event the person whose
facsimile signature has been placed upon any Warrant shall have ceased to serve
in the capacity in which such person signed the Warrant before such Warrant is
issued, it may be issued with the same effect as if he or she had not ceased to
be such at the date of issuance.
2.2. Effect of Countersignature. Unless and until countersigned by the
Warrant Agent pursuant to this Agreement, a Warrant shall be invalid and of no
effect and may not be exercised by the holder thereof.
2.3. Warrant Register and Related Matters.
2.3.1. Warrant Register. The Warrant Agent shall maintain books (the
"WARRANT REGISTER") for the registration of the original issuance and the
registration of the transfer of the Warrants. Upon the initial issuance of the
Warrants, the Warrant Agent shall issue and register the Warrants in the names
of the respective holders thereof in such denominations and otherwise in
accordance with instructions delivered to the Warrant Agent by the Company.
2.3.2. Registered Holder. Prior to due presentment for registration of
the transfer of any Warrant, the Company and the Warrant Agent may deem and
treat the person in whose name such Warrant shall be registered upon the Warrant
Register (the "REGISTERED HOLDER"), as the absolute owner of such Warrant and of
each Warrant represented thereby (notwithstanding any notation of ownership or
other writing on the Warrant Certificate made by anyone other than the Company
or the Warrant Agent), for the purpose of any exercise thereof, and for all
other purposes, and neither the Company nor the Warrant Agent shall be affected
by any notice to the contrary.
2.4. Detachability of Public Warrants. The securities comprising the Units
will begin to trade separately on the 90th trading day after the effective date
of the Registration Statement, provided that in no event may the separate
trading of the securities comprising the Units occur until the Company files
with the SEC a Current Report on Form 8-K, which includes an audited balance
sheet reflecting the receipt by the Company of the gross proceeds of the Public
Offering, including the proceeds received by the Company from the exercise of
the Underwriters' over-allotment option, if the over-allotment option is
exercised prior to the filing of the Form 8-K (the "BALANCE SHEET 8-K"). The
securities comprising the Units may begin to trade separately earlier than on
the 90th trading date after the effective date of the Registration Statement if
Maxim Group LLC, informs the Company of its decision to allow earlier separate
trading, provided that
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in no event may the earlier separate trading of the securities comprising the
Units occur until the Company files with the SEC the Balance Sheet 8-K and the
Company issues a press release and files with the SEC a Current Report on Form
8-K announcing when such separate trading will begin.
3. Terms and Exercise of Warrants.
3.1. Warrant Price. Each Warrant shall, when countersigned by the Warrant
Agent, entitle the Registered Holder thereof, subject to the provisions of such
Warrant and of this Warrant Agreement, to purchase from the Company the number
of shares of Common Stock stated therein, at an exercise price of $7.50 per
share (the "WARRANT PRICE"), subject to the adjustments provided in Section 4
hereof and in the last sentence of this Section 3.1. The Company, in its sole
discretion, may lower the Warrant Price for the Public Warrant at any time prior
to the Expiration Date for a period of not less than ten business days, provided
that any such reduction shall be identical among all Public Warrants and Private
Warrants.
3.2. Duration of Warrants.
3.2.1. Public Warrants. A Public Warrant may be exercised only during
the period commencing on the later of: (i) the consummation by the Company of a
merger, capital stock exchange, asset acquisition or other similar business
combination (as described more fully in the Registration Statement, a "BUSINESS
COMBINATION") or (ii) _________________, 2008 and terminating at 5:00 p.m., New
York City local time on the earlier to occur of (x) ________________, 2011 or
(y) the date fixed for redemption of the Warrants, as provided in Section 6 of
this Agreement. Notwithstanding the foregoing, no Public Warrant shall be
exercisable unless, at the time of exercise, a registration statement relating
to the Common Stock issuable upon the exercise of such Public Warrant is
effective and current and a prospectus is available for use by the public
stockholders and the Common Stock has been qualified or deemed to be exempt
under the securities laws of the state of residence of the holder of such Public
Warrants.
3.2.2. Private Warrants. A Private Warrant may be exercised only
during the period commencing on the later of: (i) the consummation by the
Company of a Business Combination or (ii) ____________, 2008 and terminating at
5:00 p.m., New York City local time on the earlier to occur of (x)
______________, 2011 or (y) the date fixed for redemption of the Warrants, as
provided in Section 6 of this Agreement.
3.2.3. General. The period during which a Warrant may be exercised
shall be deemed the "EXERCISE PERIOD" and the termination of such Exercise
Period shall be deemed the "EXPIRATION DATE". Except with respect to the right
of the holders of Warrants to receive the Redemption Price (as set forth in
Section 6 hereunder), each Warrant not exercised on or before the Expiration
Date shall become void, and all rights thereunder and all rights in respect
thereof under this Agreement shall cease at the close of business on the
Expiration Date. The Company, in its sole discretion, may extend the duration of
the Warrants by delaying the Expiration Date; provided, however, that the
Company will provide notice to the Registered Holders of the
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Warrants of such extension of not less than twenty (20) days and, further
provided that any such extension shall be proportionally identical in duration
among all of the Warrants.
3.3. Exercise of Warrants.
3.3.1. Payment. Subject to the provisions of the Warrants and this
Warrant Agreement, a Warrant, when countersigned by the Warrant Agent, may be
exercised by the Registered Holder thereof by surrendering it, at the office of
the Warrant Agent, or at the office of its successor as Warrant Agent, in the
Borough of Manhattan, City and State of New York, with the subscription form, as
set forth in each of the Warrants, duly executed, and: (i) by paying in full, in
lawful money of the United States, by good certified check or good bank
draft payable to the order of the Company, the Warrant Price for each full share
of Common Stock as to which the Warrant is exercised and any and all applicable
taxes due in connection with the exercise of the Warrant, the exchange of the
Warrant for the Common Stock, and the issuance of the Common Stock or (ii) on a
cashless basis by surrendering his or her Warrant for that number of shares of
Common Stock equal to the quotient obtained by dividing (x) the product of the
number of shares of Common Stock underlying the Warrant, multiplied by the
difference between the Warrant Price and the Fair Market Value (as defined
below) by (y) the Fair Market Value. The "FAIR MARKET VALUE" shall mean the
average reported last sale price of the Common Stock for the 10 trading days
ending on the third business day prior to the date on which notice of exercise
is received by the Company, or in the event that the Company has given a notice
of redemption to the holder of a Warrant, on the third business day prior to the
date on which any notice of redemption is sent to holders of the Warrants
pursuant to Section 6 hereof.
3.3.2. Issuance of Certificates. As soon as practicable after the
exercise of any Warrant and the clearance of the funds in payment of the Warrant
Price, the Company shall issue to the Registered Holder of such Warrant a
certificate or certificates for the number of full shares of Common Stock to
which he, she or it is entitled, registered in such name or names as may be
directed by him, her or it, and if such Warrant shall not have been exercised in
full, a new countersigned Warrant for the number of shares as to which such
Warrant shall not have been exercised. Notwithstanding the foregoing, the
Company shall not be obligated to deliver any securities pursuant to the
exercise of a Public Warrant: (i) a registration statement under the Act with
respect to the Common Stock issuable upon such exercise is effective, or (ii) in
the opinion of counsel to the Company, the Common Stock issuable upon exercise
of the Public Warrant is exempt from the registration requirements of the Act
and such securities are qualified for sale or exempt from qualification under
applicable securities laws of the states or other jurisdictions in which the
Registered Holder resides. Warrants may not be exercised by, or securities
issued to, any Registered Holder in any state in which such exercise or issuance
would be unlawful. In no event will the Registered Holder of a warrant be
entitled to receive a net-cash settlement in lieu of physical settlement in
shares of Common Stock, regardless of whether the Common Stock underlying the
Warrants is registered pursuant to an effective registration statement.
3.3.3. Valid Issuance. All shares of Common Stock issued upon the
proper exercise of a Warrant in conformity with this Agreement shall be duly
authorized, validly issued, fully paid and nonassessable.
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3.3.4. Date of Issuance. Each person in whose name any such
certificate for shares of Common Stock is issued shall for all purposes be
deemed to have become the holder of record of such shares on the date on which
the Warrant was surrendered and payment of the Warrant Price was made,
irrespective of the date of delivery of such certificate, except that, if the
date of such surrender and payment is a date when the stock transfer books of
the Company are closed, such person shall be deemed to have become the holder of
such shares at the close of business on the next succeeding date on which the
stock transfer books are open.
3.3.5. Warrant Solicitation and Warrant Solicitation Fee.
(a) The Company has engaged Maxim Group LLC ("MAXIM"), on a
non-exclusive basis, as its agent for the solicitation of the exercise of the
Warrants. The Company, at its cost, will: (i) assist Maxim with respect to such
solicitation, if requested by Maxim, and (ii) provide Maxim, and direct the
Company's transfer agent and the Warrant Agent to deliver to Maxim, lists of the
record and, to the extent known, beneficial owners of the Company's Warrants.
The Company hereby instructs the Warrant Agent to cooperate with Maxim in every
respect in connection with Maxim's solicitation activities, including, but not
limited to, providing to Maxim, at the Company's cost, a list of record and
beneficial holders of the Warrants and circulating a prospectus or offering
circular disclosing the compensation arrangements referenced in Section 3.3.5(b)
below to holders of the Warrants at the time of exercise of the Warrants. In
addition to the conditions set forth in Section 3.3.5(b), Maxim shall accept
payment of the warrant solicitation fee provided in Section 3.3.5(b) only if it
has provided bona fide services to the Company in connection with the exercise
of the Warrants and only to the extent that an investor who exercises his
Warrants specifically designates, in writing, that Maxim solicited his, her or
its exercise. In addition to soliciting, either orally or in writing, the
exercise of Warrants by a Warrant holder, such services may also include
disseminating information, either orally or in writing, to Warrant holders about
the Company or the market for the Company's securities, or assisting in the
processing of the exercise of Warrants.
(b) In each instance in which a Public Warrant is exercised, the
Warrant Agent shall promptly give written notice ("WARRANT AGENT'S EXERCISE
NOTICE") of such exercise to the Company and Maxim. If, upon the exercise of any
Warrant more than one year from the effective date of the Registration
Statement: (i) the market price of the Company's Common Stock is greater than
the Warrant Price, (ii) disclosure of compensation arrangements between the
Company and Maxim with respect to the solicitation of the exercise of the
Warrants was made both at the time of the Public Offering and at the time of
exercise (by delivery of the Prospectus or as otherwise required by applicable
law, rule or regulation), (iii) the holder of the Warrant confirms in writing
that the exercise of the Warrant was solicited by Maxim, (iv) the Warrant was
not held in a discretionary account, and (v) the solicitation of the exercise of
the Warrant was not in violation of Regulation M (as such rule or any successor
rule may be in effect as of such time of exercise) promulgated under the
Securities Exchange Act of 1934, as amended, then the Warrant Agent,
simultaneously with the distribution of the Common Stock underlying the Warrants
so exercised in accordance with the instructions from the Company following
receipt of the proceeds to the Company received upon exercise of such
Warrant(s), shall, on behalf of the Company, pay in the case of an exercise of
the Warrant, on a cash exercise (warrant exercise fees payable with respect to
cashless exercise will be paid directly by the Company), a fee of 5% of the
Warrant Price to Maxim, provided that Maxim
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delivers to the Warrant Agent within ten (10) business days from the date on
which Maxim has received the Warrant Agent's Exercise Notice, a certificate that
the conditions set forth in the preceding clauses (iii), (iv) and (v) have been
satisfied. Notwithstanding the foregoing, no fee will be paid to Maxim with
respect to the exercise by the Underwriters or their affiliates or the Company's
officers or directors of Warrants purchased by it or them and still held by them
for its or their own account. Maxim and the Company may, at any time during
business hours, examine the records of the Warrant Agent, including its ledger
of original Warrant certificates returned to the Warrant Agent upon exercise of
Warrants.
(c) The provisions of this Section 3.3.5. may not be modified, amended
or deleted without the prior written consent of Maxim.
4. Adjustments.
4.1. Stock Dividends; Split Ups. If after the date hereof, and subject to
the provisions of Section 4.6 below, the number of outstanding shares of Common
Stock is increased by a stock dividend payable in shares of Common Stock, or by
a split up of shares of Common Stock, or other similar event, then, on the
effective date of such stock dividend, split up or similar event, the number of
shares of Common Stock issuable upon exercise of each Warrant shall be increased
in proportion to such increase in outstanding shares of Common Stock.
4.2. Aggregation of Shares. If after the date hereof, and subject to the
provisions of Section 4.6, the number of outstanding shares of Common Stock is
decreased by a consolidation, combination, reverse stock split or
reclassification of shares of Common Stock or other similar event, then, on the
effective date of such consolidation, combination, reverse stock split,
reclassification or similar event, the number of shares of Common Stock issuable
on exercise of each Warrant shall be decreased in proportion to such decrease in
outstanding shares of Common Stock.
4.3. Adjustments in Exercise Price. Whenever the number of shares of Common
Stock purchasable upon the exercise of the Warrants is adjusted, as provided in
Section 4.1 and 4.2 above, the Warrant Price shall be adjusted (to the nearest
cent) by multiplying such Warrant Price immediately prior to such adjustment by
a fraction (x) the numerator of which shall be the number of shares of Common
Stock purchasable upon the exercise of the Warrants immediately prior to such
adjustment, and (y) the denominator of which shall be the number of shares of
Common Stock so purchasable immediately thereafter.
4.4. Replacement of Securities upon Reorganization, etc. In case of any
reclassification or reorganization of the outstanding shares of Common Stock
(other than a change covered by Section 4.1 or 4.2 hereof or that solely affects
the par value of such shares of Common Stock), or in the case of any merger or
consolidation of the Company with or into another corporation (other than a
consolidation or merger in which the Company is the continuing corporation and
that does not result in any reclassification or reorganization of the
outstanding shares of Common Stock), or in the case of any sale or conveyance to
another corporation or entity of the assets or other property of the Company as
an entirety or substantially as an entirety in connection with which the Company
is dissolved, the Warrant
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holders shall thereafter have the right to purchase and receive, upon the basis
and upon the terms and conditions specified in the Warrants and in lieu of the
shares of Common Stock of the Company immediately theretofore purchasable and
receivable upon the exercise of the rights represented thereby, the kind and
amount of shares of stock or other securities or property (including cash)
receivable upon such reclassification, reorganization, merger or consolidation,
or upon a dissolution following any such sale or transfer, that the Registered
Holder of the Warrant would have received if such Warrant holder had exercised
his, her or its Warrant(s) immediately prior to such event; and if any
reclassification also results in a change in shares of Common Stock covered by
Section 4.1 or 4.2, then such adjustment shall be made pursuant to Sections 4.1,
4.2, 4.3 and this Section 4.4. The provisions of this Section 4.4 shall
similarly apply to successive reclassifications, reorganizations, mergers or
consolidations, sales or other transfers.
4.5. Notices of Changes in Warrant. Upon every adjustment of the Warrant
Price or the number of shares issuable on exercise of a Warrant, the Company
shall give written notice thereof to the Warrant Agent, which notice shall state
the Warrant Price resulting from such adjustment and the increase or decrease,
if any, in the number of shares purchasable at such price upon the exercise of a
Warrant, setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based. Upon the occurrence of any event
specified in Sections 4.1, 4.2, 4.3 or 4.4, then, in any such event, the Company
shall give written notice to the Warrant holder, at the last address set forth
for such holder in the Warrant Register, of the record date or the effective
date of the event. Failure to give such notice, or any defect therein, shall not
affect the legality or validity of such event.
4.6. No Fractional Shares. Notwithstanding any provision contained in this
Warrant Agreement to the contrary, the Company shall not issue fractional shares
upon exercise of Warrants. If, by reason of any adjustment made pursuant to this
Section 4, the holder of any Warrant would be entitled, upon the exercise of
such Warrant, to receive a fractional interest in a share, the Company shall,
upon such exercise, round up to the nearest whole number the number of the
shares of Common Stock to be issued to the Warrant holder.
4.7. Form of Warrant. The form of Warrant need not be changed because of
any adjustment pursuant to this Section 4, and Warrants issued after such
adjustment may state the same Warrant Price and the same number of shares as is
stated in the Warrants initially issued pursuant to this Agreement. However, the
Company may at any time in its sole discretion make any change in the form of
Warrant that the Company may deem appropriate and that does not affect the
substance thereof, and any Warrant thereafter issued or countersigned, whether
in exchange or substitution for an outstanding Warrant or otherwise, may be in
the form as so changed.
5. Transfer and Exchange of Warrants.
5.1. Registration of Transfer. The Warrant Agent shall register the
transfer, from time to time, of any outstanding Warrant upon the Warrant
Register, upon surrender of such Warrant for transfer, properly endorsed with
signatures properly guaranteed and accompanied by appropriate instructions for
transfer. Upon any such transfer, a new Warrant representing an
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equal aggregate number of Warrants shall be issued and the old Warrant shall be
cancelled by the Warrant Agent. The Warrants so cancelled shall be delivered by
the Warrant Agent to the Company from time to time upon request.
5.2. Procedure for Surrender of Warrants. Warrants may be surrendered to
the Warrant Agent, together with a written request for exchange or transfer, and
thereupon the Warrant Agent shall issue in exchange therefor one or more new
Warrants as requested by the Registered Holder of the Warrants so surrendered,
representing an equal aggregate number of Warrants; provided, however, that in
the event that a Warrant surrendered for transfer bears a restrictive legend,
the Warrant Agent shall not cancel such Warrant and issue new Warrants in
exchange therefor until the Warrant Agent has received an opinion of counsel for
the Company stating that such transfer may be made and indicating whether the
new Warrants must also bear a restrictive legend.
5.3. Fractional Warrants. The Warrant Agent shall not be required to effect
any registration of transfer or exchange which will result in the issuance of a
warrant certificate for a fraction of a warrant.
5.4. Service Charges. No service charge shall be made for any exchange or
registration of transfer of Warrants.
5.5. Warrant Execution and Countersignature. The Warrant Agent is hereby
authorized to countersign and to deliver, in accordance with the terms of this
Agreement, the Warrants required to be issued pursuant to the provisions of this
Section 5, and the Company, whenever required by the Warrant Agent, will supply
the Warrant Agent with Warrants duly executed on behalf of the Company for such
purpose.
6. Redemption.
6.1. Redemption. Subject to Section 6.3 hereof, not less than all of the
outstanding Warrants may be redeemed, each in conjunction with the redemption of
the other, at the option of the Company, at any time after they become
exercisable and prior to the Expiration Date, at the office of the Warrant
Agent, upon the notice referred to in Section 6.2, at the price of $.01 per
Warrant (the "REDEMPTION PRICE"), provided that the last sales price of the
Common Stock has been equal to or greater than $14.25 per share, on each of
twenty (20) trading days within any thirty (30) trading day period ending on the
third business day prior to the date on which notice of redemption is given. The
provisions of this Section 6.1 may not be modified, amended or deleted without
the prior written consent of Maxim.
6.2. Date Fixed for, and Notice of, Redemption. In the event the Company
shall elect to redeem all of the Warrants, the Company shall fix a date for the
redemption. Notice of redemption shall be mailed by first class mail, postage
prepaid, by the Company not less than 30 days prior to the date fixed for
redemption to the Registered Holders of the Warrants to be redeemed at their
last addresses as they shall appear on the Warrant Register. Any notice mailed
in the manner herein provided shall be conclusively presumed to have been duly
given whether or not the Registered Holder received such notice.
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6.3. Exercise After Notice of Redemption. The Warrants may be exercised in
accordance with Section 3 of this Warrant Agreement at any time after notice of
redemption shall have been given by the Company pursuant to Section 6.2 hereof
and prior to the time and date fixed for redemption. On and after the redemption
date, the record holder of the Warrants shall have no further rights except to
receive, upon surrender of the Warrants, the Redemption Price.
7. Other Provisions Relating to Rights of Holders of Warrants.
7.1. No Rights as Stockholder. A Warrant does not entitle the Registered
Holder thereof to any of the rights of a stockholder of the Company, including,
without limitation, the right to receive dividends, or other distributions,
exercise any preemptive rights to vote or to consent or to receive notice as
stockholders in respect of the meetings of stockholders or the election of
directors of the Company or any other matter.
7.2. Lost, Stolen, Mutilated, or Destroyed Warrants. If any Warrant is
lost, stolen, mutilated, or destroyed, the Company and the Warrant Agent may on
such terms as to indemnity or otherwise as they may in their discretion impose
(which shall, in the case of a mutilated Warrant, include the surrender
thereof), issue a new Warrant of like denomination, tenor, and date as the
Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant shall
constitute a substitute contractual obligation of the Company, whether or not
the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time
enforceable by anyone.
7.3. Reservation of Common Stock. The Company shall at all times reserve
and keep available a number of its authorized but unissued shares of Common
Stock that will be sufficient to permit the exercise in full of all outstanding
Warrants issued pursuant to this Warrant Agreement.
7.4. Registration of Common Stock. The Company agrees that prior to the
commencement of the Exercise Period, it shall file with the SEC a post-effective
amendment to the Registration Statement, or a new registration statement, for
the registration, under the Act, of, and it shall take such action as is
necessary to qualify for sale, in those states in which the Warrants were
initially offered by the Company, the Common Stock issuable upon exercise of the
Warrants. In either case, the Company will use its best efforts to cause the
same to become effective on or prior to the commencement of the Exercise Period
and to maintain the effectiveness of such registration statement until the
expiration of the Warrants in accordance with the provisions of this Warrant
Agreement. The provisions of this Section 7.4 may not be modified, amended or
deleted without the prior written consent of Maxim. Notwithstanding the
foregoing, in no event will the Registered Holder of any Warrant or the
underlying Common Stock be entitled to receive a net-cash settlement or other
payment as of result of the Company's non-compliance with this Section 7.4. In
addition, it is acknowledged that, in the event the Company is unable, for any
reason, to cause such post-effective amendment or new registration statement to
become effective or to maintain its effectiveness, the Warrants may expire
worthless.
8. Concerning the Warrant Agent and Other Matters.
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8.1. Payment of Taxes. The Company will from time to time promptly pay all
taxes and charges that may be imposed upon the Company or the Warrant Agent in
respect of the issuance or delivery of shares of Common Stock upon the exercise
of Warrants, but the Company shall not be obligated to pay any transfer taxes in
respect of the Warrants or such shares.
8.2. Resignation, Consolidation, or Merger of Warrant Agent.
8.2.1. Appointment of Successor Warrant Agent. The Warrant Agent, or
any successor to it hereafter appointed, may resign its duties and be discharged
from all further duties and liabilities hereunder after giving sixty (60) days'
notice in writing to the Company. If the office of the Warrant Agent becomes
vacant by resignation or incapacity to act or otherwise, the Company shall
appoint in writing a successor Warrant Agent in place of the 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 or incapacity by the Warrant
Agent or by the holder of the Warrant (who shall, with such notice, submit his
Warrant for inspection by the Company), then the holder of any Warrant may apply
to the Supreme Court of the State of New York for the County of New York for the
appointment of a successor Warrant Agent. Any successor Warrant Agent, whether
appointed by the Company or by such court, shall be a corporation organized and
existing under the laws of the State of New York, in good standing and having
its principal office in the Borough of Manhattan, City and State of New York,
and authorized under such laws to exercise corporate trust powers and subject to
supervision or examination by federal or state authority. After appointment, any
successor Warrant Agent shall be vested with all the authority, powers, rights,
immunities, duties, and obligations of its predecessor Warrant Agent with like
effect as if originally named as Warrant Agent hereunder, without any further
act or deed; but if for any reason it becomes necessary or appropriate, the
predecessor Warrant Agent shall execute and deliver, at the expense of the
Company, an instrument transferring to such successor Warrant Agent all the
authority, powers, and rights of such predecessor Warrant Agent hereunder; and
upon request of any successor Warrant Agent the Company shall make, execute,
acknowledge, and deliver any and all instruments in writing for more fully and
effectually vesting in and confirming to such successor Warrant Agent all such
authority, powers, rights, immunities, duties, and obligations.
8.2.2. Notice of Successor Warrant Agent. In the event a successor
Warrant Agent shall be appointed, the Company shall give notice thereof to the
predecessor Warrant Agent and the transfer agent for the Common Stock not later
than the effective date of any such appointment.
8.2.3. Merger or Consolidation of Warrant Agent. Any corporation into
which the Warrant Agent may be merged or with which it may be consolidated or
any corporation resulting from any merger or consolidation to which the Warrant
Agent shall be a party shall be the successor Warrant Agent under this Warrant
Agreement without any further act.
8.3. Fees and Expenses of Warrant Agent.
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8.3.1. Remuneration. The Company agrees to pay the Warrant Agent
reasonable remuneration for its services as such Warrant Agent hereunder as set
forth on Exhibit A hereto, and will reimburse the Warrant Agent upon demand for
all expenditures that the Warrant Agent may reasonably incur in the execution of
its duties hereunder.
8.3.2. Further Assurances. The Company agrees to perform, execute,
acknowledge, and deliver or cause to be performed, executed, acknowledged, and
delivered all such further and other acts, instruments, and assurances as may
reasonably be required by the Warrant Agent for the carrying out or performing
of the provisions of this Warrant Agreement.
8.4. Liability of Warrant Agent.
8.4.1. Reliance on Company Statement. Whenever in the performance of
its duties under this Warrant Agreement, the Warrant Agent shall deem it
necessary or desirable that any fact or matter be proved or established by the
Company prior to taking or suffering any action hereunder, such fact or matter
(unless other evidence in respect thereof be herein specifically prescribed) may
be deemed to be conclusively proved and established by a statement signed by the
Chief Executive Officer or Chief Operating Officer of the Company and delivered
to the Warrant Agent. The Warrant Agent may rely upon such statement for any
action taken or suffered in good faith by it pursuant to the provisions of this
Warrant Agreement.
8.4.2. Indemnity. The Warrant Agent shall be liable hereunder only for
its own negligence, willful misconduct or bad faith. The Company agrees to
indemnify the Warrant Agent and save it harmless against any and all
liabilities, including judgments, costs and reasonable counsel fees, for
anything done or omitted by the Warrant Agent in the execution of this Warrant
Agreement except as a result of the Warrant Agent's negligence, willful
misconduct, or bad faith.
8.4.3. Exclusions. The Warrant Agent shall have no responsibility with
respect to the validity of this Warrant Agreement or with respect to the
validity or execution of any Warrant (except its countersignature thereof); nor
shall it be responsible for any breach by the Company of any covenant or
condition contained in this Warrant Agreement or in any Warrant; nor shall it be
responsible to make any adjustments required under the provisions of Section 4
hereof or responsible for the manner, method, or amount of any such adjustment
or the ascertaining of the existence of facts that would require any such
adjustment; nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any shares
of Common Stock to be issued pursuant to this Warrant Agreement or any Warrant
or as to whether any shares of Common Stock will when issued be duly authorized,
validly issued, fully paid and nonassessable.
8.5. Acceptance of Agency. The Warrant Agent hereby accepts the agency
established by this Warrant Agreement and agrees to perform the same upon the
terms and conditions herein set forth and among other things, shall account
promptly to the Company with respect to Warrants exercised and concurrently
account for, and pay to the Company, all moneys received by the Warrant Agent
for the purchase of shares of the Company's Common Stock through the exercise of
Warrants.
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9. Miscellaneous Provisions.
9.1. Successors. All the covenants and provisions of this Warrant Agreement
by or for the benefit of the Company or the Warrant Agent shall bind and inure
to the benefit of their respective successors and assigns.
9.2. Notices. Any notice or other communication required or which may be
given hereunder shall be in writing and either be delivered personally or by
private national courier service, or be mailed, certified or registered mail,
return receipt requested, postage prepaid, and shall be deemed given when so
delivered personally or, if sent by private national courier service, on the
next business day after delivery to the courier, or, if mailed, two business
days after the date of mailing, as follows:
Alpha Security Group Corporation
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxxxx, Chief Executive Officer
Any notice, statement or demand authorized by this Warrant Agreement to be given
or made by the holder of any Warrant or by the Company to or on the Warrant
Agent shall be sufficiently given when so delivered if by hand or overnight
delivery or if sent by certified mail or private courier service five days after
deposit of such notice, postage prepaid, addressed (until another address is
filed in writing by the Warrant Agent with the Company), as follows:
American Stock Transfer & Trust Company
00 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Compliance Department
with a copy (which shall not constitute notice) in each case to:
Ellenoff, Xxxxxxxx & Schole LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx
and
Xxxxxxx Xxxxxx Xxxxxxxxx &
Kakoyiannis, P.C.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxxxxx
and
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Maxim Group LLC
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxxx X. Xxxxxx,
Managing Director
9.3. Applicable Law. The validity, interpretation, and performance of this
Warrant Agreement and of the Warrants shall be governed in all respects by the
laws of the State of New York, without giving effect to conflict of laws. The
Company hereby agrees that any action, proceeding or claim against it arising
out of or relating in any way to this Warrant Agreement shall be brought and
enforced in the courts of the State of New York or the United States District
Court for the Southern District of New York, and irrevocably submits to such
jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives
any objection to such exclusive jurisdiction and that such courts represent an
inconvenient forum. Any such process or summons to be served upon the Company
may be served by transmitting a copy thereof by registered or certified mail,
return receipt requested, postage prepaid, addressed to it at the address set
forth in Section 9.2 hereof. Such mailing shall be deemed personal service and
shall be legal and binding upon the Company in any action, proceeding or claim.
9.4. Persons Having Rights under this Warrant Agreement. Nothing in this
Warrant Agreement expressed and nothing that may be implied from any of the
provisions hereof is intended, or shall be construed, to confer upon, or give
to, any person or corporation other than the parties hereto and the Registered
Holders of the Warrants and, for the purposes of Sections 3.3.5, 7.4, 9.2 and
9.8 hereof, Maxim, any right, remedy, or claim under or by reason of this
Warrant Agreement or of any covenant, condition, stipulation, promise, or
agreement hereof. Maxim shall be deemed to be a third-party beneficiary of this
Warrant Agreement with respect to Sections 3.3.5, 7.4, 9.2 and 9.8 hereof. All
covenants, conditions, stipulations, promises, and agreements contained in this
Warrant Agreement shall be for the sole and exclusive benefit of the parties
hereto (and Maxim with respect to the Sections 3.3.5, 7.4, 9.2 and 9.8 hereof)
and their successors and assigns and of the registered holders of the Warrants.
9.5. Examination of the Warrant Agreement. A copy of this Warrant Agreement
shall be available at all reasonable times at the office of the Warrant Agent in
the Borough of Manhattan, City and State of New York, for inspection by the
Registered Holder of any Warrant. The Warrant Agent may require any such holder
to submit his Warrant for inspection by it.
9.6. Counterparts. This Warrant Agreement may be executed in any number of
counterparts and each of such counterparts may be delivered by facsimile or
other electronic transmission, which shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.
9.7. Effect of Headings. The Section headings herein are for convenience
only and are not part of this Warrant Agreement and shall not affect the
interpretation thereof.
9.8. Amendments. This Warrant Agreement may be amended by the parties
hereto without the consent of any registered holder for the purpose of curing
any ambiguity, or of curing, correcting or supplementing any defective provision
contained herein or adding or
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changing any other provisions with respect to matters or questions arising under
this Warrant Agreement as the parties may deem necessary or desirable and that
the parties deem shall not adversely affect the interest of the registered
holders. All other modifications or amendments, including any amendment to
increase the Warrant Price or shorten the Exercise Period, shall require the
written consent of each of Maxim and the registered holders of a majority of the
then outstanding Warrants. Notwithstanding the foregoing, the Company may lower
the Warrant Price or extend the duration of the Exercise Period in accordance
with Sections 3.1 and 3.2, respectively, without such consent.
9.9. Severability. This Warrant Agreement shall be deemed severable, and
the invalidity or unenforceability of any term or provision hereof shall not
affect the validity or enforceability of this Warrant Agreement or of any other
term or provision hereof. Furthermore, in lieu of any such invalid or
unenforceable term or provision, the parties hereto intend that there shall be
added as a part of this Warrant Agreement a provision as similar in terms to
such invalid or unenforceable provision as may be possible and be valid and
enforceable.
IN WITNESS WHEREOF, this Warrant Agreement has been duly executed by the
parties hereto as of the day and year first above written.
Attest: ALPHA SECURITY GROUP CORPORATION
-----------------------------
By:
------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Chief Executive Officer and
President
Attest: AMERICAN STOCK TRANSFER & TRUST COMPANY
-----------------------------
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
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