NO: ____
COMMON STOCK PURCHASE WARRANT
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT") OR ANY OTHER APPLICABLE STATE SECURITIES LAWS AND
HAS BEEN ISSUED IN RELIANCE UPON REGULATION D PROMULGATED UNDER THE SECURITIES
ACT.
THIS WARRANT MAY NOT BE SOLD, PLEDGED, TRANSFERRED OR ASSIGNED EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES LAWS, OR IN A TRANSACTION WHICH IS EXEMPT FROM
REGISTRATION UNDER THE PROVISIONS OF THE SECURITIES ACT AND UNDER PROVISIONS OF
APPLICABLE STATE SECURITIES LAWS.
COMMON STOCK PURCHASE WARRANT issued this _____ day of ________, 2000 by
XXXXXXX.XXX, INC., a Delaware corporation (the "Company"), in favor of
______________________________________ (the "Holder").
AGREEMENT:
1. Issuance of Warrant; Term. This Warrant is one of a series of
Warrants being issued by the Company in connection with a private offering of
investment units ("Units") of the Company's securities (the "Offering") pursuant
to the Company's Private Placement Memorandum dated ___________, 2000 (the
"Memorandum"). The Units being offered in the Offering consist of a 10% Secured
Convertible Debenture in the principal amount of $100,000 (the "Debenture") and
the Warrant. The Company hereby grants to Holder the right to purchase [up to
200,000 shares of the Company's common stock (or such lesser or greater
proportionate number of shares if a fractional Unit or more than one Unit is
purchased),] par value $.001 (the "Common Stock"), upon the exercise of this
Warrant (the "Shares"). This Warrant and the Shares are subject to all the
conditions and limitations set forth in the Memorandum and the subscription
documents attached as exhibits to the Memorandum. The Warrant shall be
exercisable at any time and from time to time beginning on the date hereof,
expiring on the day prior to the fifth (5th) anniversary of the date of issuance
hereof ("Expiration Date").
2. Exercise Price Procedure. Subject to the terms of this Warrant,
the exercise price per share for which all or any of the Shares may be purchased
pursuant to the terms of this Warrant is $1.00 (the "Exercise Price"). This
Warrant may be exercised by the Holder hereof as to all or in increments of one
thousand (1,000) Shares (or the balance of the Shares if less than such number),
upon delivery of written notice of intent to exercise in the form attached
hereto as Exhibit A to the Company at the following address: Xxxxxxx.xxx, Inc.,
00 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000, Xxxxxxxxx:
1
Xxxx Xxxxx, CEO or such other address as the Company shall designate in a
written notice to the Holder hereof, together with this Warrant and a check
payable to the Company for the aggregate Exercise Price, of the Shares so
purchased. Upon exercise of this Warrant as aforesaid, the Company shall, as
promptly as practicable, and in any event within thirty (30) days thereafter,
execute and deliver to the Holder of this Warrant a certificate or certificates
for the total number of whole Shares for which this Warrant is being exercised.
If this Warrant shall be exercised with respect to less than all of the Shares,
the Holder shall be entitled to receive a new Warrant covering the number of
Shares in respect of which this Warrant shall not have been exercised, which new
Warrant shall in all other respects be identical to this Warrant.
3. Redemption. The Warrants are redeemable by the Company upon
thirty (30) days' written notice to all holders thereof at a price of $.05 per
Warrant, so long as (i) the closing bid price for the Common Stock as reported
by the National Association of Securities' Dealers automated quotation system
for any twenty-two (22) consecutive trading day period within the thirty (30)
day period immediately prior to the date of such notice exceeds $2.00 per share
and (ii) the Shares, as well as the shares into which the Debenture is
convertible (the "Debenture Shares"), the shares issuable upon exercise of the
warrants granted to Connecticut Capital Markets, LLC (the "Placement Agent")
pursuant to the Offering (the "Placement Agent Shares") and the Clawback Shares
(as defined in the Debenture) have been registered for re-sale pursuant to the
Securities Act and are freely tradable without restriction or legend
("Registered"). As used herein, "closing bid price" means, in each case at the
close of trading hours (not including extended trading hours), (i) if the Common
Stock is listed on the New York Stock Exchange ("NYSE") or the American Stock
Exchange ("AMEX"), the last reported sale price or (ii) if the Common Stock is
listed on the Nasdaq National Market System, SmallCap Market or over-the-counter
bulletin board, the closing bid price for the Common Stock as reported by the
Nasdaq National Market System, SmallCap Market or over-the-counter bulletin
board, as applicable, or (iii) if the Common Stock is not listed or admitted for
trading on any national securities exchange and is not reported by NYSE, AMEX,
Nasdaq National Market System, SmallCap Market or over-the-counter bulletin
board, or if the Common Stock is traded in the over-the-counter market but bid
quotations are not published on Nasdaq, the closing bid price for the Common
Stock as furnished by a broker-dealer which regularly furnishes price quotations
for the Common Stock; or (iv) if no such quotations are available, as determined
in good faith by the Board of Directors of the Company.
4. Covenants and Conditions. The above provisions are subject to the
following:
(a) Neither this Warrant nor the Shares have been registered under
the Securities Act or any state securities laws (the "Blue Sky Laws").
This Warrant has been acquired for investment purposes and not with a view
to distribution or resale and may not be pledged, hypothecated, sold, made
subject to a security interest, or otherwise transferred without (i) an
effective registration statement for such Warrant under the Securities
Act, or (ii) an opinion of counsel, which opinion of counsel shall be
reasonably satisfactory to the Company and its counsel, that registration
is not required under the Securities Act. Transfer of the Shares issued
upon the exercise of this Warrant shall be restricted in the same manner
and to the same extent as the Warrant and the certificates representing
such Shares shall bear substantially the following legend until
Registered:
2
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR ANY APPLICABLE STATE SECURITIES LAW AND MAY NOT BE TRANSFERRED UNTIL A
REGISTRATION STATEMENT UNDER THE ACT OR SUCH APPLICABLE STATE SECURITIES
LAW SHALL HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR IN THE OPINION OF
COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY, REGISTRATION UNDER THE ACT
OR SUCH APPLICABLE STATE SECURITIES LAW IS NOT REQUIRED IN CONNECTION WITH
THE PROPOSED TRANSFER.
(b) The Company covenants and agrees that all Shares which may be
issued upon exercise of this Warrant will, upon issuance and payment
therefor, be legally and validly issued and outstanding, fully paid and
nonassessable, free from all liens, charges and preemptive rights, if any,
with respect thereto or to the issuance thereof. The Company shall at all
times reserve and keep available for issuance upon the exercise of this
Warrant such number of authorized but unissued shares of Common Stock as
will be sufficient to permit the exercise in full of this Warrant. The
Company shall insure that all conversions properly requested by the Holder
shall be effected by the Company.
(c) Notwithstanding anything to the contrary contained herein, if at
any time that any Warrant shall remain outstanding, and until 90 days
after the Shares are listed for quotation by the Nasdaq National Market or
Nasdaq SmallCap Market (but not including the NASDAQ Bulletin Board) or
traded on the New York Stock Exchange, the American Stock Exchange, the
London Stock Exchange or the Neuer Markt, and actually trading thereon
("Listed"), the Company implements a reverse stock split (or multiple
reverse stock splits in the aggregate) of 1:5 or more, the shares of the
Common Stock issuable upon exercise of this Warrant, will be adjusted on a
basis of no greater than 1:5. The provision of this paragraph limiting the
reverse split shall apply to any cumulative multiple reverse splits should
they occur.
5. Adjustment Upon Changes In Stock.
(a) If the Company shall at any time prior to the exercise or
termination of this Warrant effect a recapitalization or reclassification
of such character that the Common Stock shall be changed into or become
exchangeable for a larger or smaller number of Shares, then, upon the
effective date thereof, the number of Shares that the Holder of this
Warrant shall be entitled to purchase upon exercise hereof shall be
increased or decreased, as the case may be, in direct proportion to the
increase or decrease in such number of Shares by reason of such
recapitalization or reclassification, and the Exercise Price of such
recapitalized or reclassified common stock shall, in the case of an
increase in the number of shares, be proportionately decreased and, in the
case of a decrease in the number of shares, be proportionately increased.
If any adjustment under this Section 5(a) would create a fractional share
of Common Stock or a right to acquire a fractional share of Common Stock,
such fractional share shall be disregarded and the number of Shares
subject to this Warrant shall be the next higher number of shares,
rounding all fractions upward.
(b) If all or any portion of this Warrant shall be exercised
subsequent to
3
any merger, consolidation, exchange of shares, separation, reorganization
or liquidation of the Company or other similar event occurring after the
date hereof, as a result of which shares of Common Stock shall be changed
into the same or a different number of shares of the same or another class
or classes of securities of the Company or another entity, then the Holder
exercising this Warrant shall receive, from the aggregate price paid upon
such exercise, the aggregate percentage of the class of shares which such
Holder would have received if this Warrant had been exercised immediately
prior to such merger, consolidation, exchange of shares, separation,
reorganization or liquidation, or other similar event. If any adjustment
under this Section 5(b) would create a fractional share of Common Stock or
a right to acquire a fractional share of common stock, such fractional
share shall be disregarded and the number of Shares subject to this
Warrant shall be the next higher number of Shares, rounding all fractions
upward.
(c) If, prior to the exercise hereof by the Holder, the Company has
issued, or shall be deemed to have issued, Additional Shares of Common
Stock (as hereinafter defined) without consideration or for a
consideration per share less than the Exercise Price ("Pre-Conversion
Consideration"), then and in such event, the Exercise Price shall be
adjusted in the manner set forth in this subsection 5(c) as of the date of
such issuance or deemed issuance, with the date of such adjustment
referred to herein as the "Adjustment Date".
(ii) If the Company has issued, or shall be deemed to have
issued, Additional Shares of Common Stock (as hereinafter defined)
without consideration or for a consideration per share less than
$.50 (as adjusted to reflect stock splits, stock dividends,
recapitalizations and the like) ("Adjustment Price"), then and in
such event, the Exercise Price shall be reduced concurrently with
such issue to a price (calculated to the nearest cent) to an amount
determined by multiplying the Exercise Price by a fraction:
(A) the numerator of which shall be (a) the number of
shares of Common Stock outstanding immediately prior to the
issuance of Additional Shares of Common Stock, plus (b) the
number of shares of Common Stock which could be purchased at
the Adjustment Price using the net aggregate consideration
received by the Company for the purchase of the total number
of such Additional Shares of Common Stock so issued, and
(B) the denominator of which shall be (a) the number of
shares of Common Stock outstanding immediately prior to the
issuance of such Additional Shares of Common Stock, plus (b)
the number of Additional Shares of Common Stock so issued.
(iii) As used herein:
"Additional Shares of Common Stock" shall mean all shares of Common
Stock issued or deemed to be issued (pursuant to the
4
following sentence) by the Company after the date hereof; provided,
however, that, "Additional Shares of Common Stock" shall not include
(i) the issuance of up to an aggregate of twenty percent (20%) of
the issued and outstanding Common Stock of the Company, on a fully
diluted basis, to officers, directors or employees of, or
consultants to, the Company, pursuant to a stock purchase or option
plan or other incentive program approved by the Board of Directors,
or pursuant to an employee's employment agreement with the Company,
(ii) the Shares, Interest Shares (as defined in that certain
placement agent agreement between the Company and the Placement
Agent (the "Placement Agent Agreement"), Clawback Shares (as defined
in the Placement Agent Agreement), Debenture Shares, Placement Agent
Shares (as defined in the Placement Agent Agreement), (iii)
issuances or deemed issuances described in subsections (a) or (b) of
this Section 5 for which the Holder receives an adjustment pursuant
thereto, (iv) securities issued to strategic partners, licensees,
distribution partners, technology or service vendors or content
providers, provided, however, that any issuances pursuant to this
clause (iv) do not exceed 2% (without regard to such issuance) of
the then-issued and outstanding Common Stock in any single, or group
of related transactions or transactions with one such entity or any
affiliate thereof, or 10% (without regard to such issuance) of the
then-issued and outstanding Common Stock in the aggregate. If the
Company issues any Options or Convertible Securities (as hereinafter
defined), the maximum number of shares of Common Stock issuable
thereunder shall be deemed to be Additional Shares of Common Stock
issued as of the time of such issue, if the consideration per share
of such Additional Shares of Common Stock is less than the
Adjustment Price then in effect, until such time as such Options or
Convertible Securities shall terminate or be exercised or converted
into Common Stock, upon which time the number of shares of Common
Stock actually thereupon issued shall be deemed to be Additional
Shares of Common Stock. Consideration per share of Additional Shares
of Common Stock shall be determined by adding the consideration
received upon issuance of the Options or Convertible Securities to
the maximum possible consideration to be received upon exercise,
conversion or exchange of such Options or Convertible Securities for
shares of Common Stock. If any consideration consists of property
other than cash, the value of such property shall be computed at the
fair market value at the time of such issuance of Additional Shares
of Common Stock, as determined in good faith by the Board of
Directors.
"Options" shall mean rights, options or warrants to subscribe for,
purchase or otherwise acquire Common Stock.
"Convertible Securities" shall mean any evidences of indebtedness,
5
shares (other than Common Stock) or other securities directly or
indirectly convertible into or exchangeable for Common Stock.
With respect to Options and Convertible Securities, "Consideration"
per share of Additional Shares of Common Stock shall be determined
by adding (x) the aggregate consideration received upon issuance of
the Options or Convertible Securities divided by the number of
shares receivable upon the exercise or conversion thereof and (y)
the minimum possible consideration per share received upon the
exercise, conversion or exchange of such Options or Convertible
Securities for shares of Common Stock.
6. Registration. Within sixty (60) days after the date of the final
issuance of Units (the "Final Issuance Date") pursuant to the Offering (the
"Filing Period"), the Company shall use its reasonable best efforts to file a
registration statement ("Registration Statement") registering the Shares for
resale under the Securities Act. The Company further agrees to use its best
efforts to cause such Registration Statement to become effective within 120 days
after the Final Issuance Date ("Effectiveness"). The Company shall pay the
expenses described in Section 8 for the Registration Statement filed pursuant to
this Section 6, except for underwriting discounts and commissions and transfer
taxes, which expenses shall be borne by the Holder.
7. Registration Procedures. In connection with the Company's
obligations pursuant to Section 6, the Company will:
(a) cause the Registration Statement to remain effective for a
period of two (2) years from the later of the date of Effectiveness and
the date the Shares are Listed; provided, however, that (i) such two year
period shall be extended for a period of time equal to the period Holder
refrains from selling any Shares included in such Registration Statement
at the request of an underwriter of securities of the Company or at the
request of the Company or the exchange on which the Shares are Listed, and
(ii) in the case of any registration of the Shares on Form S-3 or
comparable successor form which are intended to be offered on a continuous
or delayed basis, such two year period shall be extended, if necessary, to
keep the Registration Statement effective until all Shares are sold,
provided that applicable rules and regulations under the Securities Act
governing the obligation to file a post-effective amendment permit, in
lieu of filing a post-effective amendment which (x) includes any
prospectus required by Section 10(a)(3) of the Securities Act or (y)
reflects facts or events representing a material or fundamental change in
the information set forth in the Registration Statement, the incorporation
by reference of information required to be included in (x) and (y) hereof
to be contained in periodic reports filed pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934, as amended, (the "Exchange Act")
in the Registration Statement; (the "Effective Period");
(b) prepare and file with the Securities and Exchange Commission
(the "Commission") such amendments to such Registration Statement and
supplements to the prospectus contained therein as may be necessary to
keep such Registration Statement effective for the Effective Period as may
be reasonably necessary to effect the sale of such securities;
6
(c) furnish to Holder such reasonable number of copies of the
Registration Statement and final prospectus as Holder may reasonably
request;
(d) use its best efforts to register or qualify the Shares covered
by such Registration Statement under such state securities or Blue Sky
laws of such jurisdictions as Holder may reasonably request in writing
within thirty (30) days following the original filing of the Registration
Statement, except that the Company shall not for any purpose be required
to execute a general consent to service of process or to qualify to do
business as a foreign corporation in any jurisdiction wherein it is not so
qualified;
(e) Furnish to the Holder, and to the Placement Agent and its legal
counsel (i) promptly after the same is prepared and publicly distributed,
filed with the Commission or received by the Holder, one copy of the
Registration Statement and any amendment thereto, each preliminary
prospectus and prospectus and each amendment or supplement thereto in both
electronic and print format, and (ii) such number of copies of a
prospectus, including a preliminary prospectus, and all amendments and
supplements thereto, and such other documents as the Holder may reasonably
request in order to facilitate the disposition of the Shares owned by
Xxxxxx;
(f) Notify Holder at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the happening of any
event as a result of which the prospectus included in such Registration
Statement, as then in effect, includes an untrue statement of a material
fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or incomplete in
light of the circumstances then existing, and at the request of Holder,
prepare and furnish to it a reasonable number of copies of a supplement to
or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to Holder, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading or incomplete in light of the circumstances then existing;
(g) Use its best efforts to prevent the issuance of any stop order
or other suspension of effectiveness of a Registration Statement, and, if
such an order is issued, to obtain the withdrawal of such order at the
earliest possible moment and to notify Holder (or, in the event of an
underwritten offering, the managing underwriters) of the issuance of such
order and the resolution thereof;
(h) Provide a transfer agent and registrar for all Shares and a
CUSIP number for all such Shares, in each case not later than the
Effective Period;
(i) Make available for inspection by the Holder, any underwriter
participating in any disposition pursuant to such Registration Statement
and any attorney or accountant retained by the Holder or underwriter, all
financial and other records, pertinent corporate documents and properties
of the Company and cause the Company's
7
officers and directors to supply all information reasonably requested by
the Holder, any underwriter, attorney or accountant in connection with
such Registration Statement;
(j) Otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, and make available to the Holder,
as soon as reasonably practicable, an earnings statement covering the
period of at least twelve (12) months, but not more than eighteen (18)
months, beginning with the first month after the Effective Period, which
earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act;
(k) Enter into any underwriting agreement reasonably necessary to
effect the offer and sale of the Shares, provided such underwriting
agreement contains customary underwriting provisions and provided,
further, that if the underwriter so requests, the underwriting agreement
will contain customary indemnification and contribution provisions; and
(l) Hold in confidence and not make any disclosure of information
concerning the Holder provided to the Company unless (i) disclosure of
such information is necessary to comply with federal or state securities
laws, (ii) the disclosure of such information is necessary to avoid or
correct a misstatement or omission in any Registration Statement, (iii)
the release of such information is ordered pursuant to a subpoena or other
order from a court or governmental body of competent jurisdiction or (iv)
such information has been made generally available to the public other
than by disclosure in violation of this or any other agreement; and, upon
learning that disclosure of such information concerning the Holder is
sought in or by a court or governmental body of competent jurisdiction or
through other means, give prompt notice to the Holder and, at its expense,
undertake appropriate action to prevent disclosure of, or to obtain a
protective order for, such information.
8. Expenses. With respect to the inclusion of the Shares in a
Registration Statement, subject to Section 7(d) hereof, all fees, costs and
expenses of such registration including Blue Sky fees, shall be borne by the
Company; provided, however, that Holder shall be responsible to pay for all
transfer taxes.
9. Indemnification.
(a) The Company shall indemnify the Holder and any underwriter
or person deemed to be an underwriter within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Exchange Act, from and against any and
all losses, claims, damages and liabilities (including without limitation
reasonable attorney's fees and expenses) caused by any untrue statement of a
material fact contained in the Registration Statement, any other registration
statement filed by the Company under the Exchange Act, any post-effective
amendment to such registration statements, or any prospectus included therein
required to be filed or furnished by reason of this agreement or caused by any
omission to state therein a material fact required to be stated therein or
required to make the statements therein not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or alleged untrue statement or omission or alleged omission based upon
information furnished or required to be furnished in writing to the Company by
the Holder; which indemnification shall include each person, if any, who
8
controls any such Holder within the meaning of the Exchange Act and each
officer, director, employee and agent of such Xxxxxx.
(b) The Holder shall indemnify the Company and each person, if
any, who controls the Company within the meaning of Section 15 of the Securities
Act or Section 20(a) of the Exchange Act, from and against any and all losses,
claims, damages or liabilities caused by any untrue statement or a material fact
contained in the Registration Statement, any other registration statement filed
by the Company under the Act, any post-effective amendment to such registration
statements, or any prospectus included therein required to be filed or furnished
by reason of this Agreement or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, to the extent and only to the extent that
such losses, claims, damages or liabilities are caused (i) by any such untrue
statement or alleged untrue statement or omission or alleged omission based upon
information furnished or required to be furnished in writing to the Company by
the Holder or (ii) Holder's failure to deliver the prospectus or (iii) failure
of the Holder to sell its Securities as per the plan of distribution set forth
in the prospectus; which indemnification shall include each person, if any, who
controls the Company within the meaning of the Act and each officer, director,
employee and agent of the Company; provided, however, that the Holder shall only
be liable for such amounts up to the proceeds received from such Xxxxxx's sale
of the Shares.
(c) Promptly after receipt of notice of the commencement of
any action in respect of which indemnity may be sought against any indemnifying
party under Section 9 (a) or (b) above, the indemnified party will notify the
indemnifying party in writing of the commencement thereof, and the indemnifying
party will, subject to the provisions hereinafter stated, assume the defense of
such action (including the employment of counsel reasonably satisfactory to the
indemnified party and the payment of expenses) insofar as such action relates to
an alleged liability in respect of which indemnity may be sought against the
indemnifying party. After notice from the indemnifying party of its election to
assume the defense of such claim or action, the indemnifying party shall no
longer be liable to the indemnified party under this Section 9 for any legal or
other expenses subsequently incurred by the indemnified party in connection with
the defense thereof other than reasonable causes of investigation; provided,
however, that if, in the written opinion of counsel to the indemnified party or
parties, it is advisable for the indemnified party or parties to be represented
by separate counsel, the indemnified party or parties shall have the right to
employ a single counsel to represent the indemnified parties who may be subject
to liability arising out of any claim in respect of which indemnity might be
sought by the indemnified parties thereof against the indemnifying party, in
which event the reasonable fees and expenses of such separate counsel shall be
borne by the indemnifying party. Any party against whom indemnification may be
sought under this Section 9 shall not be liable to indemnify any person that
might otherwise be indemnified pursuant hereto for any settlement of any action
effected without such indemnifying party's consent, which consent shall not be
unreasonably withheld.
(d) If for any reason the indemnification provided for in this
Section 9 is held by a court of competent jurisdiction to be unavailable to an
indemnified part with respect to any loss, claim, damage, liability or expense
referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
the indemnified party as a result of such loss,
9
claim, damage or liability in such proportion as is appropriate to reflect not
only the relative benefits received by the indemnified party and the
indemnifying party, but also the relative fault of the indemnified party and the
indemnifying party, as well as any other relevant equitable considerations.
10. Loss, Destruction, Etc. of Warrant. Upon receipt of evidence
satisfactory to the Company of the loss, theft, mutilation or destruction of
this Warrant, and in the case of any such loss, theft or destruction, upon
delivery of a bond of indemnity by the Holder in such form and amount as shall
be reasonably satisfactory to the Company, the Company will make and deliver a
new Warrant, of like tenor, in lieu of such lost, stolen, destroyed or mutilated
Warrant. Any Warrant issued under the provisions of this Section 10 in lieu of
any Warrant alleged to be lost, destroyed or stolen, or in lieu of any mutilated
Warrant, shall constitute an original contractual obligation on the part of the
Company.
11. Governing Law. This Warrant shall be governed by and construed
in accordance with the laws of the State of New York.
12. Notices to Warrant Holders. Nothing contained in this Agreement
shall be construed as conferring upon the Holder or Holders the right to vote or
to consent or to receive notice as a shareholder in respect of any meetings of
shareholders for the election of directors or any other matter, or as having any
rights whatsoever as a shareholder of the Company. If, however, at any time
prior to the Expiration Date of the Warrant and its exercise, any of the
following events shall occur:
(a) the Company shall take a record of the holders of its shares of
Common Stock for the purpose of entitling them to receive a dividend or
distribution payable otherwise than in cash, or a cash dividend or
distribution payable otherwise than out of current or retained earnings,
as indicated by the accounting treatment of such dividend or distribution
on the books of the Company; or
(b) the Company shall offer to all the Holders of its Common Stock
any additional shares of capital stock of the Company or securities
convertible into or exchangeable for shares of capital stock of the
Company, or any option, right or warrant to subscribe therefor; or
(c) a dissolution, liquidation or winding up of the Company (other
than in connection with a consolidation or merger) or a sale of all or
substantially all of its property, assets and business as an entirety
shall be proposed;
then, in any one or more of said events, the Company shall give
written notice of such an event to the Holder at least fifteen (15) days prior
to the date fixed as a record date or the date of closing the transfer books for
the determination of the shareholders entitled to such dividend, distribution,
convertible or exchangeable securities or subscription rights, options or
warrants, or entitled to vote on such proposed dissolution, liquidation, winding
up or sale, or at the earliest date permitted to do so by applicable securities
laws, if later. Such notice shall specify such record date or the date of
closing the transfer books, as the case may be. Failure to give such notice or
any defect therein shall not affect the validity of any action taken in
connection with the declaration or payment of any such dividend or distribution,
or the issuance of any convertible or exchangeable securities or subscription
10
rights, options or warrants, or any proposed dissolution, liquidation, winding
up or sale.
13. Notices. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed to have been
duly made when delivered, or mailed by registered or certified mail, return
receipt requested:
(a) If to the Holder of the Warrants, to the address of such Holder
as shown on the books of the Company; or
(d) If to the Company, to the following address:
Xxxxxxx.xxx, Inc.
00 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxx, CEO
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
or to such other address as the Company may designate by notice to the
Holders.
14. Supplements and Amendments. The Company and the Holder may from
time to time supplement or amend this Warrant Certificate in order to cure any
ambiguity, to correct or supplement any provision contained herein which may be
defective or inconsistent with any provisions herein, or to make any other
provisions in regard to matters or questions arising hereunder which the parties
hereto may deem necessary or
desirable and which the parties hereto deem not to adversely affect the
interests of the Holder of this Warrant Certificate.
15. Termination. This Warrant shall terminate on the Expiration Date
or on any earlier date when all Warrants have been exercised; provided, however,
that the provisions of Section 9 shall survive such termination.
IN WITNESS WHEREOF, the Company has executed this Common Stock Purchase
Warrant as of the date first above written.
Dated: _______________
XXXXXXX.XXX, INC.
By:/s/
_____________________________________
Xxxx Xxxxx
President and Chief Executive Officer
11
WARRANT EXERCISE FORM
To Be Executed by the Holder
in Order to Exercise Warrant
The undersigned Holder hereby irrevocably elects to exercise this Warrant
and to purchase ________ shares of Xxxxxxx.xxx, Inc.'s Common Stock issuable
upon exercise of such Warrant, and requests that certificates for such
securities shall be issued in the name of:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or type name and address)
________________________________________________________________________________
(please insert social security or other identifying number)
and be delivered as follows:
________________________________________________________________________________
________________________________________________________________________________
(please print or type name and address)
________________________________________________________________________________
(please insert social security or other identifying number)
and if such number of shares of Common Stock shall not be all the shares
evidenced by this Warrant, that a new Warrant for the balance of such shares be
registered in the name of, and delivered to, Holder.
________________________________________
Signature of Holder
12
