Contract
Exhibit
4.3
THIS
WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY
STATE SECURITIES LAWS, AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED,
ASSIGNED OR HYPOTHECATED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS
OR (B) AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION UNDER
THE ACT OR APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED WITH RESPECT TO SUCH
OFFER, SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION; OR (II) UNLESS SOLD PURSUANT
TO RULE 144 UNDER SAID ACT.
THIS
WARRANT IS ISSUED PURSUANT TO THAT CERTAIN NOTE (AS DEFINED BELOW)
ISSUED TO THE INITIAL HOLDER OF THIS WARRANT (THE “INVESTOR”) BY MRU HOLDINGS,
INC., A DELAWARE CORPORATION (THE “COMPANY”).
Dated: July
31, 2008
MRU
HOLDINGS, INC.
OF
COMMON
STOCK, $0.001 PAR VALUE PER SHARE
1. Number of Shares Subject to
Warrant. (a) This is to certify that, FOR VALUE RECEIVED, [●] (the “Investor”), is entitled,
subject to the terms set forth below, to purchase from the Company, upon
surrender of this Warrant, at any time or times on or after the date hereof, but
prior to the termination of this Warrant pursuant to Section 3 hereof, at the
Warrant Price, [●] shares (the
“Warrant Shares”) of the
Company’s common stock, $0.001 par value per share (“Common Stock”), upon such
Investor’s exercise of this Warrant pursuant to Section 7
hereof. Certain capitalized terms used in this Warrant are defined in
Section 2 hereof.
(b) Exercise
Limitations.
(i) Notwithstanding
anything to the contrary contained in Section 1(a) hereof, in no event shall the
Investor be entitled to exercise this Warrant for a number of Warrant Shares in
excess of that number of Warrant Shares which, upon giving effect to such
exercise, would cause the aggregate number of shares of Common Stock
beneficially owned by the Investor and its affiliates to exceed 19.99% of the
voting power of the Company, following such exercise, unless the Company obtains
the requisite stockholder approval under NASDAQ Marketplace Rule 4350(i)(1)(B)
(the “Issuance
Limitation”), in which case, the Issuance Limitation under this Section
1(b) shall no longer apply to the Investor. For purposes of this
Section 1(b)(i), the aggregate number of shares of Common Stock beneficially
owned by the Investor and its affiliates shall include the shares of Common
Stock issuable upon the exercise of this Warrant,
1.
subject
in all cases to the Issuance Limitation. Upon the written request of
the Investor, the Company shall promptly, but in no event later than two (2)
Business Days following the receipt of such notice, confirm in writing to the
Holder the number of shares of Common Stock then outstanding. The
number of Warrant Shares purchaseable upon exercise of this Warrant and the
Warrant Price shall be subject to adjustment from time to time as described
herein.
2. Definitions. As used
in this Warrant, the following terms shall have the meanings ascribed to them
below:
(a) “Business Day” shall mean any
day except Saturday, Sunday and any day which shall be a legal holiday or a day
on which banking institutions in the state of New York are authorized or
required by law or other government actions to close between the hours of 9:30
a.m. and 5:00 p.m. Eastern Standard Time.
(b) “Note” means the $[●] principal amount
convertible promissory note issued to the Investor on July 31,
2008.
(c) “Fair Market Value” means the
fair market value of a share of Common Stock, determined in good faith by the
board of directors of the Company, and measured in reference to the closing bid
price of the Common Stock on the trading day immediately preceding the day on
which a determination of fair market value is to be made.
(d) “Holder” shall mean the Investor
and any permitted transferees.
(e)
“Person” means an individual, a
limited liability company, a partnership, a joint venture, a corporation, a
trust, an unincorporated organization or a governmental entity or any other
legal entity.
(f) “Warrant Price” means $1.40,
subject to adjustment as provided herein.
3.
Termination. This
Warrant shall terminate and no longer be exercisable at 5:00 p.m., New York
time, on July 30, 2013.
4.
Fractional
Shares. No fractional shares shall be issuable upon exercise
of this Warrant and the number of shares of Common Stock to be issued shall be
rounded up to the nearest whole share.
5.
No Stockholder
Rights. This Warrant, by itself, as distinguished from any shares of
Common Stock purchased hereunder, shall not entitle the Holder to any of the
rights of a stockholder of the Company.
6.
Reservation of
Stock. The Company shall reserve from its authorized and
unissued Common Stock a sufficient number of shares to provide for the issuance
of Warrant Shares upon the exercise or conversion of this
Warrant. Issuance of this Warrant shall constitute full authority to
the Company’s officers who are charged with the duty of executing stock
certificates to execute, issue and deliver the necessary certificates for
Warrant Shares issuable upon the exercise or conversion of this
Warrant.
2.
7. Exercise of
Warrant. Subject to the conditions set forth in Section 1
hereof, this Warrant may be exercised at any time prior to its termination by
the surrender of this Warrant, together with the Notice of Exercise and the
Investment Representation Statement in the forms attached hereto as Attachments 1 and 2, respectively, duly
completed and executed, at the principal office of the Company, specifying the
portion of this Warrant to be exercised and accompanied by payment in full of
the Warrant Price (a) in cash or by certified check with respect to the Warrant
Shares being purchased or (b) by written direction of the Company to cancel a
portion of this Warrant sufficient to satisfy the “cashless exercise” provisions
of this Section 7. This Warrant shall be deemed to have been
exercised immediately prior to the close of business on the date of its
surrender for exercise as provided above, and the Person entitled to receive the
Warrant Shares issuable upon exercise shall be treated for all purposes as the
holder of such shares of record as of the close of business on such
date. As promptly as practicable after such date, the Company shall
issue and deliver to the Person or Persons entitled to receive the same a
certificate or certificates (or a direct registration system statement if the
shares are to be issued in book entry form) representing the number of full
Warrant Shares issuable upon such exercise. If the Warrant shall be
exercised for less than the total number of Warrant Shares then issuable upon
exercise, promptly after surrender of the Warrant upon such exercise, the
Company shall execute and deliver a new Warrant, dated the date hereof,
evidencing the right of the Holder to the balance of the Warrant Shares
purchasable hereunder upon the same terms and conditions set forth
herein.
In lieu of payment of the Warrant Price in cash, the Holder may direct the
Company to cancel a portion of this Warrant having a value equal to the Warrant
Price for the number of Warrant Shares as to which the Holder exercises this
Warrant, determined by multiplying the number of Warrant Shares as to which this
Warrant is directed to be cancelled by an amount equal to the difference between
(i) the Fair Market Value on the date of exercise and (ii) the Warrant Price
then in effect. Payment by such cancellation is referred to herein as
“cashless exercise.”
8.
Adjustment of Exercise Price
and Number of Shares. The number of shares issuable upon
exercise of this Warrant (or any shares of stock or other securities or property
at the time receivable or issuable upon exercise of this Warrant) and the
Warrant Price therefor are subject to adjustment upon the occurrence of the
following events:
(a) Adjustment for Stock Splits,
Recapitalizations, etc. The Warrant Price and the number of
shares issuable upon exercise of this Warrant shall each be proportionally
adjusted to reflect any, stock split, reverse stock split, combination of
shares, reclassification, recapitalization or other similar event altering the
number of outstanding shares of the Company’s capital stock.
(b) Adjustment for Other
Dividends and Distributions. In case the Company shall make or
issue, or shall fix a record date for the determination of eligible holders
entitled to receive, a dividend or other distribution with respect to the Common
Stock payable in securities of the Company then, and in each such case, the
Holder, on exercise of this Warrant at any time after the consummation,
effective date or record date of such event (each an “Event Date”), shall
receive, in addition to the Warrant Shares (or such other stock or securities)
issuable on such exercise prior to the Event Date, the securities of the Company
to which such Holder would have
3.
been
entitled upon such Event Date if such Holder had exercised this Warrant
immediately prior the Event Date (all subject to further adjustment as provided
in this Warrant)
9.
Adjustment for Capital
Reorganization, Consolidation, Merger or Sale. If any capital
reorganization of the capital stock of the Company, or any consolidation or
merger of the Company with or into another corporation, or the sale of all or
substantially all of the Company’s assets to another corporation shall be
effected in such a way that holders of the Company’s capital stock will be
entitled to receive stock, securities or assets with respect to or in exchange
for the Company’s capital stock, then in each such case the Holder, upon the
exercise of this Warrant, at any time after the consummation of such capital
reorganization, consolidation, merger, or sale, shall be entitled to receive, in
lieu of the stock or other securities and property receivable upon the exercise
of this Warrant prior to such consummation, the stock or other securities or
property to which such Holder would have been entitled upon such consummation if
such Holder had exercised this Warrant immediately prior to the consummation of
such capital reorganization, consolidation, merger, or sale, all subject to
further adjustment as provided in this Section 9; and in each such case, the
terms of this Warrant shall be applicable to the shares of stock or other
securities or property receivable upon the exercise of this Warrant after such
consummation.
10.
Transfer of
Warrant. This Warrant may be transferred or assigned by the
Holder hereof in whole or in part, provided that the transferor provides, at the
Company’s request, an opinion of counsel satisfactory to the Company that such
transfer does not require registration under the Act and any other applicable
federal or state securities laws.
11.
Amendments and
Waivers. This Warrant and any term hereof may only be amended,
waived, discharged or terminated by a written instrument signed by the Company
and the Investor.
12.
Governing Law;
Venue. This Warrant shall be governed by the laws of the State
of New York, as such laws are applied to contracts to be entered into and
performed entirely in New York by New York residents, without giving effect to
any choice of law or conflict of law provision or rule that would cause the
application of the laws of any jurisdictions other than the State of New
York. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in New York County for the
adjudication of any dispute hereunder or in connection herewith or therewith, or
with any transaction contemplated hereby or discussed herein, and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such
court, that such suit, action or proceeding is brought in an inconvenient forum
or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of
process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address for such
notices to it under this Warrant and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law.
13.
Headings;
Notice. The headings in this Warrant are for purposes of
convenience and reference only, and shall not be deemed to constitute a part
hereof. All notices and other communications
from the Company to the Holder of this Warrant shall be delivered, personally,
4.
mailed by
first class mail, postage prepaid, or when sent by facsimile transmission or by
e-mail delivery of a “.pdf” format data file (provided confirmation of receipt
is received by the sending party transmission is mechanically or electronically
generated and kept on file by the sending party) to the address, facsimile
number or e-mail address furnished to the Company in writing by the last Holder
of this Warrant who shall have furnished an address, facsimile number or e-mail
address to the Company in writing, and if mailed shall be deemed given three
days after deposit in the United States mail.
14.
Waiver of Jury
Trial. AS A MATERIAL INDUCEMENT FOR EACH PARTY HERETO TO ENTER
INTO THIS WARRANT, THE PARTIES HERETO HEREBY IRREVOCABLY WAIVE ANY RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS WARRANT AND/OR
ANY AND ALL OF THE OTHER DOCUMENTS ASSOCIATED WITH THIS
TRANSACTION.
IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of
the date first written above.
| MRU HOLDINGS, INC | ||
| By: | _________________________ | |
| Name: Xxxxxx Xxxx | ||
| Title: Co-President | ||
5.
Attachment
1
NOTICE
OF EXERCISE
TO: MRU
HOLDINGS, INC.
1. The
undersigned hereby elects to purchase ________ Warrant
Shares of MRU Holdings, Inc. pursuant to the terms of the attached Warrant, and
tenders herewith payment of the purchase price in full, together with all
applicable transfer taxes, if any.
2. Please
issue a certificate(s) (or a direct registration system statement(s) if the
shares are to be issued in book entry form) in the name(s) and amounts specified
below:
| _________________________________ | _________________________________ | |
| Name | Name | |
| _________________________________ | _________________________________ | |
| Xxxxxx Xxxxxxx | Xxxxxx Xxxxxxx | |
| _________________________________ | _________________________________ | |
| State, City and Zip Code | State, City and Zip Code | |
| _________________________________ | _________________________________ | |
| Number of Warrant Shares | Number of Warrant Shares | |
| Check here for “cashless exercises”: ______ | ||
| HOLDER: | ||
| _________________________________ | ||
| Signature of Holder of Warrant | ||
| _________________________________ | ||
| Name of Holder of Warrant (print) | ||
| _________________________________ | ||
| Date |
Attachment
2
INVESTMENT
REPRESENTATION STATEMENT
Warrant
Shares
(as
defined in the attached Warrant) of
MRU
HOLDINGS, INC.
In
connection with the purchase of the above-listed securities, the undersigned
hereby represents to MRU Holdings, Inc. (the “Company”) as
follows:
(a) By
acceptance hereof, that, as of this date, the undersigned is an “accredited
investor” as such term is defined in Rule 501(a)(1) of Regulation D promulgated
by the Securities and Exchange Commission under the Act. The
securities to be received upon the exercise of the Warrant (the “Warrant Shares” as defined in the
attached Warrant) will be acquired for investment for its own account; not as a
nominee or agent, and not with a view to the sale or distribution of any part
thereof, and the undersigned has no present intention of selling, granting
participation in or otherwise distributing the same, but subject, nevertheless,
to any requirement of law that the disposition of its property shall at all
times be within its control. By executing this Statement, the
undersigned further represents that the undersigned does not have any contract,
undertaking, agreement or arrangement with any person to sell, transfer, or
grant participation to such person or to any third person, with respect to any
Warrant Shares issuable upon exercise of the Warrant.
(b) The
undersigned understands that the Warrant Shares issuable upon exercise of the
Warrant at the time of issuance may not be registered under the Act, and
applicable state securities laws, on the ground that the issuance of such
securities is exempt pursuant to Section 4(2) and/or Regulation D of the Act and
state law exemptions relating to offers and sales not by means of a public
offering, and that the Company’s reliance on such exemptions is predicated on
the undersigned’s representations set forth herein.
(c) The
undersigned agrees that in no event will it make a disposition of any Warrant
Shares acquired upon the exercise of the Warrant unless and until (i) the
undersigned shall have notified the Company of the proposed disposition and
shall have furnished the Company with a statement of the circumstances
surrounding the proposed disposition, and (ii) the undersigned shall have
furnished the Company with an opinion of counsel satisfactory to the Company and
Company’s counsel to the effect that (A) appropriate action necessary for
compliance with the Act and any applicable state securities laws has been taken
or an exemption from the registration requirements of the Act and such laws is
available, and (B) the proposed transfer will not violate any of said
laws.
(d) The
undersigned acknowledges that an investment in the Company is highly speculative
and represents that it is able to fend for itself in the transactions
contemplated by this Statement, has such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and risks of its
investments, and has the ability to bear the economic risks (including the risk
of a total loss) of its investment. The undersigned represents that
the undersigned has had the opportunity to ask questions of the Company
concerning the Company’s business and assets and to obtain any additional
information which the undersigned considered
necessary
to verify the accuracy of or to amplify the Company’s disclosures, and has had
all questions which have been asked, satisfactorily answered by the
Company.
(e) The
undersigned acknowledges that the Warrant Shares issuable upon exercise of the
Warrant must be held indefinitely unless subsequently registered under the Act
or an exemption from such registration is available. The undersigned
is aware of the provisions of Rule 144 promulgated under the Act which permit
limited resale of shares purchased in a private placement subject to the
satisfaction of certain conditions. The undersigned acknowledges that if the
undersigned and its affiliates are not deemed affiliates of the Company at any
time during the three (3) months preceding a resale and the undersigned has
beneficially owned the Warrant within the meaning of Rule 144 for at least six
months and effects a “cashless exercise” of the Warrant,” any resale of the
Warrant Shares by the undersigned will be subject only to the availability of
current public information about the Company. The undersigned further
acknowledges that, if the undersigned and its affiliates are deemed affiliates
of the Company and the undersigned has beneficially owned the Warrant for at
least six months and effects a “cashless exercise” of the Warrant, the
undersigned understands that any resale of the Warrant Shares by the undersigned
will be subject to the current public information requirements about the
Company, volume limitations, certain manner of sale provisions and notice
requirements. Notwithstanding the foregoing, the holding periods
discussed in this paragraph (e) will not begin to run until the undersigned pays
the Warrant Price for the Warrant Shares if the Warrant Price is paid in cash
instead of by “cashless exercise.”
HOLDER
_________________________________
Signature
of Holder of Warrant
_________________________________
Name of
Holder of Warrant (print)
_________________________________
Date
