THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY OTHER SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED, PLEDGED OR...
THIS
WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
OR ANY OTHER SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF (1) AN EFFECTIVE REGISTRATION
STATEMENT COVERING SUCH SECURITIES UNDER THE SECURITIES ACT AND ANY OTHER
APPLICABLE SECURITIES LAWS, OR (2) AN OPINION OF COUNSEL REASONABLY SATISFACTORY
TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
IN
ADDITION, THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF
MAY
NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED, OR BE THE SUBJECT
OF ANY HEDGING, SHORT SALE, DERIVATIVE, PUT, OR CALL TRANSACTION THAT WOULD
RESULT IN THE EFFECTIVE ECONOMIC DISPOSITION OF SUCH SECURITIES BY ANY PERSON
FOR A PERIOD OF SIX (6) MONTHS IMMEDIATELY FOLLOWING THE DATE OF EFFECTIVENESS
OF THE PUBLIC OFFERING OF THE COMPANY’S SECURITIES PURSUANT TO REGISTRATION
STATEMENT NO.: 333-142649
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, EXCEPT IN ACCORDANCE
WITH
NASD RULE 2710(G)(2).
EYETEL
IMAGING, INC.
UNDERWRITERS’
WARRANT
[ ]
shares of Common Stock
___________________,
2007
This
UNDERWRITERS’ WARRANT
(this
“Warrant”)
of
EyeTel Imaging, Inc., a corporation duly organized and validly existing under
the laws of the State of Delaware (the “Company”),
is
being issued pursuant to that certain Underwriting Agreement, dated as of
_________________, 2007 (the “Underwriting
Agreement”),
by
and between the Company and Maxim Group LLC, the representative of the
underwriters named therein (the “Representative”)
relating to a firm commitment public offering (the “Offering”)
of
__________________ shares of common stock, $0.001 par value per share, of the
Company (the “Common
Stock”)
underwritten by the Representative and the underwriters named in the
Underwriting Agreement.
FOR
VALUE RECEIVED,
the
Company hereby grants to ________________ and its permitted successors and
assigns (collectively, the “Holder”)
the
right to purchase from the Company up to ____________________
([ ])
[10%
of shares sold in offering] shares
of
Common Stock (such shares underlying this Warrant, the “Warrant
Shares”),
at a
per share purchase price equal to
$[ ] [120%
of initial public offering price]
(the
“Exercise
Price”),
subject to the terms, conditions and adjustments set forth below in this
Warrant.
1. Date
of Warrant Exercise.
This
Warrant shall become exercisable on the date that is six (6) months from the
Base Date (the “Exercise
Date”).
As
used in this Warrant, the term “Base
Date”
shall
mean ____________________, 2007. Except as otherwise provided for herein or
as
permitted by applicable rules of the National Association of Securities Dealers,
Inc., this Warrant shall not be sold, transferred, assigned, pledged or
hypothecated prior to the Exercise Date.
2.
Expiration
of Warrant.
This
Warrant shall expire on the five (5) year anniversary of the Base Date (the
“Expiration
Date”).
3.
Exercise
of Warrant.
This
Warrant shall be exercisable pursuant to the terms of this Section
3.
3.1
Manner
of Exercise.
(a) This
Warrant may only be exercised by the Holder hereof on or after the Exercise
Date
and on or prior to the Expiration Date, in accordance with the terms and
conditions hereof, in whole or in part (but not as to fractional shares) with
respect to any portion of this Warrant, during the Company’s normal business
hours on any day other than a Saturday or a Sunday or a day on which commercial
banking institutions in New York, New York are authorized by law to be closed
(a
“Business
Day”),
by
surrender of this Warrant to the Company at its office maintained pursuant
to
Section 10.2(a) hereof, accompanied by a written exercise notice in the form
attached as Exhibit
A
to this
Warrant (or a reasonable facsimile thereof) duly executed by the Holder,
together with the payment of the aggregate Exercise Price for the number of
Warrant Shares purchased upon exercise of this Warrant. Upon surrender of this
Warrant, the Company shall promptly cancel this Warrant document and shall,
in
the event of partial exercise, replace it with a new Warrant document in
accordance with Section 3.3
(b) Except
as
provided for in Section 3.1(c) below, each exercise of this Warrant must be
accompanied by payment in full of the aggregate Exercise Price in cash by check
or wire transfer in immediately available funds for the number of Warrant Shares
being purchased by the Holder upon such exercise.
(c) The
aggregate Exercise Price for the number of Warrant Shares being purchased may
also, in the sole discretion of the Holder, be paid in full or in part on a
“cashless basis” at the election of the Holder:
(i)
in
the
form of Common Stock owned by the Holder (based on the Fair Market Value (as
defined below) of such Common Stock on the date of exercise);
(ii)
in
the
form of Warrant Shares withheld by the Company from the Warrant Shares otherwise
to be received upon exercise of this Warrant having an aggregate Fair Market
Value on the date of exercise equal to the aggregate Exercise Price of the
Warrant Shares being purchased by the Holder; or
2
(iii)
by
a
combination of the foregoing, provided that the combined value of all cash
and
the Fair Market Value of any shares surrendered to the Company is at least
equal
to the aggregate Exercise Price for the number of Warrant Shares being purchased
by the Holder.
For
purposes of this Warrant, the term “Fair
Market Value”
means
with respect to a particular date, the average closing price of the Common
Stock
for the five (5) trading days immediately preceding the applicable exercise
herein as officially reported by the principal securities exchange on which
the
Common Stock is then listed or admitted to trading, or, if the Common Stock
is
not listed or admitted to trading on any securities exchange as determined
in
good faith by resolution of the Board of Directors of the Company, based on
the
best information available to it.
For
purposes of illustration of a cashless exercise of this Warrant under Section
3.1(c)(ii) (or for a portion thereof for which cashless exercise treatment
is
requested as contemplated by Section 3.1(c)(iii) hereof), the calculation of
such exercise shall be as follows:
X
= Y (A-B)/A
where:
|
Y
=
|
|
A
=
|
the
Fair Market Value of the Common
Stock.
|
|
B
=
|
the
Exercise Price.
|
(d) For
purposes of Rule 144 and sub-section (d)(3)(ii) thereof, it is intended,
understood, and acknowledged that the Common Stock issuable upon exercise of
this Warrant in a cashless exercise transaction as described in Section 3.1(c)
above shall be deemed to have been acquired at the time this Warrant was issued.
Moreover, it is intended, understood, and acknowledged that the holding period
for the Common Stock issuable upon exercise of this Warrant in a cashless
exercise transaction as described in Section 3.1(c) above shall be deemed to
have commenced on the date this Warrant was issued.
3.2 When
Exercise Effective.
Each
exercise of this Warrant shall be deemed to have been effected immediately
prior
to the close of business on the Business Day on which this Warrant shall have
been duly surrendered to the Company as provided in Sections 3.1 and 12 hereof,
and, at such time, the Holder in whose name any certificate or certificates
for
Warrant Shares shall be issuable upon exercise as provided in Section 3.3 hereof
shall be deemed to have become the holder or holders of record thereof of the
number of Warrant Shares purchased upon exercise of this Warrant.
3
3.3 Delivery
of Common Stock Certificates and New Warrant.
As soon
as reasonably practicable after each exercise of this Warrant, in whole or
in
part, and in any event within five (5) Business Days thereafter, the Company,
at
its expense (including the payment by it of any applicable issue taxes), will
cause to be issued in the name of and delivered to the Holder hereof or, subject
to Sections 9 and 10 hereof, as the Holder (upon payment by the Holder of any
applicable transfer taxes) may direct:
(a) a
certificate or certificates (with appropriate restrictive legends, as
applicable) for the number of duly authorized, validly issued, fully paid and
nonassessable Warrant Shares to which the Holder shall be entitled upon
exercise; and
(b) in
case
exercise is in part only, a new Warrant document of like tenor, dated the date
hereof, for the remaining number of Warrant Shares issuable upon exercise of
this Warrant after giving effect to the partial exercise of this Warrant
(including the delivery of any Warrant Shares as payment of the Exercise Price
for such partial exercise of this Warrant).
4. Certain
Adjustments.
For so
long as this Warrant is outstanding:
4.1 Mergers
or Consolidations.
If at
any time after the date hereof there shall be a capital reorganization (other
than a combination or subdivision of Common Stock otherwise provided for herein)
resulting in a reclassification to or change in the terms of securities issuable
upon exercise of this Warrant (a “Reorganization”),
or a
merger or consolidation of the Company with another corporation, association,
partnership, organization, business, individual, government or political
subdivision thereof or a governmental agency (a “Person”
or
the
“Persons”)
(other
than a merger with another Person in which the Company is a continuing
corporation and which does not result in any reclassification or change in
the
terms of securities issuable upon exercise of this Warrant or a merger effected
exclusively for the purpose of changing the domicile of the Company) (a
“Merger”),
then,
as a part of such Reorganization or Merger, lawful provision and adjustment
shall be made so that the Holder shall thereafter be entitled to receive, upon
exercise of this Warrant, the number of shares of stock or any other equity
or
debt securities or property receivable upon such Reorganization or Merger by
a
holder of the number of shares of Common Stock which might have been purchased
upon exercise of this Warrant immediately prior to such Reorganization or
Merger. In any such case, appropriate adjustment shall be made in the
application of the provisions of this Warrant with respect to the rights and
interests of the Holder after the Reorganization or Merger to the end that
the
provisions of this Warrant (including adjustment of the Exercise Price then
in
effect and the number of Warrant Shares) shall be applicable after that event,
as near as reasonably may be, in relation to any shares of stock, securities,
property or other assets thereafter deliverable upon exercise of this Warrant.
The provisions of this Section 4.1 shall similarly apply to successive
Reorganizations and/or Mergers.
4.2 Splits
and Subdivisions; Dividends.
In the
event the Company should at any time or from time to time effectuate a split
or
subdivision of the outstanding shares of Common Stock or pay a dividend in
or
make a distribution payable in additional shares of Common Stock or Common
Stock
Equivalents without payment of any consideration by such holder for the
additional shares of Common Stock or Common Stock Equivalents (including the
additional shares of Common Stock issuable upon conversion or exercise thereof),
then, as of the applicable record date (or the date of such distribution, split
or subdivision if no record date is fixed), the per share Exercise Price shall
be appropriately decreased and the number of Warrant Shares shall be
appropriately increased in proportion to such increase (or potential increase)
of outstanding shares; provided, however, that no adjustment shall be made
in
the event the split, subdivision, dividend or distribution is not effectuated.
4
4.3 Combination
of Shares.
If the
number of shares of Common Stock outstanding at any time after the date hereof
is decreased by a combination of the outstanding shares of Common Stock, the
per
share Exercise Price shall be appropriately increased and the number of shares
of Warrant Shares shall be appropriately decreased in proportion to such
decrease in outstanding shares.
4.4 Adjustments
for Other Distributions.
In the
event the Company shall declare a distribution payable in securities of other
Persons, evidences of indebtedness issued by the Company or other Persons,
assets (excluding cash dividends or distributions to the holders of Common
Stock
paid out of current or retained earnings and declared by the Company’s board of
directors) or options or rights not referred to in Sections 4.2, 4.3 or 4.4,
then, in
each such case for the purpose of this Section 4.5, upon exercise of this
Warrant, the Holder shall be entitled to a proportionate share of any such
distribution as though the Holder was the actual record holder of the number
of
Warrant Shares as of the record date fixed for the determination of the holders
of Common Stock of the Company entitled to receive such distribution.
5. No
Impairment.
The
Company will not, by amendment of its articles of incorporation or by-laws
or
through any consolidation, merger, reorganization, transfer of assets,
dissolution, issue or sale of securities or any other voluntary action, avoid
or
seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all of the
terms and in the taking of all actions necessary or appropriate in order to
protect the rights of the Holder against impairment.
6. Chief
Financial Officer’s Report as to Adjustments.
With
respect to each adjustment pursuant to Section 4 of this Warrant, the Company,
at its expense, will promptly compute the adjustment or re-adjustment in
accordance with the terms of this Warrant and cause its Chief Financial Officer
to certify the computation (other than any computation of the fair value of
property of the Company, as the case may be) and prepare a report setting forth,
in reasonable detail, the event requiring the adjustment or re-adjustment and
the amount of such adjustment or re-adjustment, the method of calculation
thereof and the facts upon which the adjustment or re-adjustment is based,
and
the Exercise Price and the number of Warrant Shares or other securities
purchasable hereunder after giving effect to such adjustment or re-adjustment,
which report shall be mailed by first class mail, postage prepaid to the Holder.
The Company will also keep copies of all reports at its office maintained
pursuant to Section 10.2(a) hereof and will cause them to be available for
inspection at the office during normal business hours upon reasonable notice
by
the Holder or any prospective purchaser of the Warrant designated by the Holder
thereof.
5
7. Reservation
of Shares.
The
Company shall, solely for the purpose of effecting the exercise of this Warrant,
at all times during the term of this Warrant, reserve and keep available out
of
its authorized shares of Common Stock, free from all taxes, liens and charges
with respect to the issue thereof and not subject to preemptive rights or other
similar rights of shareholders of the Company, such number of its shares of
Common Stock as shall from time to time be sufficient to effect in full the
exercise of this Warrant. If at any time the number of authorized but unissued
shares of Common Stock shall not be sufficient to effect in full the exercise
of
this Warrant, in addition to such other remedies as shall be available to
Holder, the Company will promptly take such corporate action as may, in the
opinion of its counsel, be necessary to increase the number of authorized but
unissued shares of Common Stock to such number of shares as shall be sufficient
for such purposes, including without limitation, using its Reasonable Best
Efforts (as defined in Section 14 hereof) to obtain the requisite shareholder
approval necessary to increase the number of authorized shares of Common Stock.
The Company hereby represents and warrants that all shares of Common Stock
issuable upon exercise of this Warrant shall be duly authorized and, when issued
and paid for upon exercise, shall be validly issued, fully paid and
nonassessable.
8. Registration
and Listing.
8.1 Definition
of Registrable Securities; Majority.
As used
herein, the term “Registrable
Securities”
means
any shares of Common Stock issuable upon the exercise of this Warrant, until
the
date (if any) on which such shares shall have been transferred or exchanged
and
new certificates for them not bearing a legend restricting further transfer
shall have been delivered by the Company and subsequent disposition of them
shall not require registration or qualification of them under the Securities
Act
or any similar state law then in force. For purposes of this Warrant, the term
“Majority”,
in
reference to the holders of Registrable Securities, shall mean in excess of
fifty percent (50%) of the then outstanding Warrant Shares (assuming the
exercise of the entire Warrant) that: (i) are not held by the Company, an
affiliate, officer, creditor, employee or agent thereof or any of their
respective affiliates, members of their family, Persons acting as nominees
or in
conjunction therewith and (ii) have not be resold to the public pursuant to
a
registration statement filed under the Securities Act. When used herein, the
term “Reasonable
Best Efforts”
means,
with respect to the applicable obligation of the Company, reasonable best
efforts for similarly situated, publicly-traded companies.
8.2 Required
Registration.
(a) At
any
time on or after the Exercise Date and on or before the five (5) year
anniversary of the Base Date, but in no event on more than one (1) occasion,
upon the written request of the holders of the Registrable Securities
representing a Majority of such Registrable Securities, the Company will use
its
Reasonable Best Efforts to effect the registration of the respective shares
of
the holders of Registrable Securities under the Securities Act to
the extent requisite to permit the public disposition thereof as expeditiously
as reasonably
possible, but in no event later than 120 days from the date of such
request.
(b) Registration
of Registrable Securities under this Section 8.2 shall be on such appropriate
registration form: (i) as shall be selected by the Company, and (ii) as shall
permit the public disposition of such Registrable Securities in accordance
with
this Section 8.2. The Company agrees to include in any such registration
statement all information which the requesting holders of Registrable Securities
shall reasonably request, which is required to be contained therein. The Company
will pay all Registration Expenses in connection with each registration of
Registrable Securities pursuant to this Section 8.2.
6
(c) A
registration requested pursuant to this Section 8.2 shall not be deemed to
have
been effected: (i) unless a registration statement with respect thereto has
become effective or (ii) if, after it has become effective, such registration
is
interfered with by any stop order, injunction or other order or requirement
of
the Securities and Exchange Commission (the “SEC”)
or
other governmental agency or court of competent jurisdiction for any reason,
other than by reason of some act or omission by a holder of Registrable
Securities.
8.3 Incidental
Registration Rights.
(a) If
the
Company, at any time on or after the Exercise Date and on or before the seven
(7) year anniversary of the Base Date, proposes to register any of its
securities under the Securities Act (other than in connection with a
registration on Form S-4 or S-8 or any successor forms) whether for its own
account or for the account of any holder or holders of its shares other than
Registrable Securities (any shares of such holder or holders (but not those
of
the Company and not Registrable Securities) with respect to any registration
are
referred to herein as, “Other
Shares”),
the
Company shall each such time give prompt (but not less than thirty (30) days
prior to the anticipated effectiveness thereof) written notice to the holders
of
Registrable Securities of its intention to do so. Upon the written request
of
any such holder of Registrable Securities made within twenty (20) days after
the
receipt of any such notice (which request shall specify the Registrable
Securities intended to be disposed of by such holder), except as set forth in
Section 8.3(b), the Company will use its Reasonable Best Efforts to effect
the
registration under the Securities Act of all of the Registrable Securities
which
the Company has been so requested to register by such holder, to the extent
requisite to permit the disposition of the Registrable Securities so to be
registered, by inclusion of such Registrable Securities in the registration
statement which covers the securities which the Company proposes to register;
provided,
however,
that if,
at any time after giving written notice of its intention to register any
securities and prior to the effective date of the registration statement filed
in connection with such registration, the Company shall determine for any reason
in its sole discretion either to not register, to delay or to withdraw
registration of such securities, the Company may, at its election, give written
notice of such determination to such holder and, thereupon: (i) in the case
of a
determination not to register, shall be relieved of its obligation to register
any Registrable Securities in connection with such registration (but not from
its obligation to pay the Registration Expenses in connection therewith),
without prejudice, however, to the rights of the holders of Registrable
Securities entitled to request that such registration be effected as a
registration under Section 8.2, (ii) in the case of a determination to delay
registration, shall be permitted to delay registering any Registrable Securities
for the same period as the delay in registering such other securities (including
the Other Shares), without prejudice, however, to the rights of the holders
of
Registrable Securities entitled to request that such registration be effected
as
a registration under Section 8.2 and (iii) in the case of a determination to
withdraw registration, shall be permitted to withdraw registration, without
prejudice, however, to the rights of the holders of Registrable Securities
entitled to request that such registration be effected as a registration under
Section 8.2. No registration effected under this Section 8.3 shall relieve
the
Company of its obligation to effect any registration upon request under Section
8.2, nor shall any such registration hereunder be deemed to have been effected
pursuant to Section 8.2. The Company will pay all Registration Expenses in
connection with each registration of Registrable Securities pursuant to this
Section 8.3.
7
(b) If
the
Company at any time proposes to register any of its securities under the
Securities Act as contemplated by this Section 8.3 and such securities are
to be
distributed by or through one or more underwriters, the Company will, if
requested by a holder of Registrable Securities, use its Reasonable Best Efforts
to arrange for such underwriters to include all the Registrable Securities
to be
offered and sold by such holder among the securities to be distributed by such
underwriters, provided that if the managing underwriter of such underwritten
offering shall inform the Company by letter of its belief that inclusion in
such
distribution of all or a specified number of such securities proposed to be
distributed by such underwriters would interfere with the successful marketing
of the securities being distributed by such underwriters (such letter to state
the basis of such belief and the approximate number of such Registrable
Securities, such Other Shares and shares held by the Company proposed so to
be
registered which may be distributed without such effect), then the Company
may,
upon written notice to such holder, the other holders of Registrable Securities,
and holders of such Other Shares reduce the number of shares of Common Stock
to
be included in such registration so that the resulting aggregate number of
such
Registrable Securities and Other Shares so included in such registration,
together with the number of securities to be included in such registration
for
the account of the Company, shall be equal to the number of shares stated in
such managing underwriter’s letter. Such reductions shall be made as follows:
(i) in the case of a registration initiated by the Company for its own account:
(A) the Company shall first reduce pro rata in accordance with the number of
shares of Common Stock desired to be included in such registration the number
of
such Registrable Securities and Other Shares the registration of which shall
have been requested by each holder thereof, and (B) thereafter, if additional
shares must be excluded from such registration, shares to be issued by the
Company shall be excluded, and (ii) in the case of a registration initiated
by
the Company for the account of a holder or holders of Other Shares: (A) the
Company shall first reduce the number of shares to be issued by the Company,
and
(B) thereafter, if additional shares must be excluded from such registration,
the Company shall reduce pro rata in accordance with the number of shares of
Common Stock desired to be included in such registration the number of such
Registrable Securities and Other Shares (other than Other Shares held by the
initiating holder or holders) the registration of which shall have been
requested by each holder thereof, and (C) thereafter, if additional shares
must
be excluded from such registration, Other Shares held by the initiating holder
or holders shall be excluded pro rata in accordance with the number of Other
Shares the registration of which shall have been requested by such initiating
holder or holders.
8.4 Registration
Procedures.
Whenever the holders of Registrable Securities have properly requested that
any
Registrable Securities be registered pursuant to the terms of this Warrant,
the
Company shall use its Reasonable Best Efforts to effect the registration and
the
sale of such Registrable Securities in accordance with the intended method
of
disposition thereof, and pursuant thereto the Company shall as expeditiously
as
possible:
8
(a) prepare
and file with the SEC a registration statement with respect to such Registrable
Securities and use its Reasonable Best Efforts to cause such registration
statement to become effective;
(b) notify
such holders of the effectiveness of each registration statement filed hereunder
and prepare and file with the SEC such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may
be
necessary to (i) keep such registration statement effective and the prospectus
included therein usable for a period commencing on the date that such
registration statement is initially declared effective by the SEC and ending
on
the date when all Registrable Securities covered by such registration statement
have been sold pursuant to the registration statement or cease to be Registrable
Securities, and (ii) comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such registration
statement during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such registration
statement;
(c) furnish
to such holders such number of copies of such registration statement, each
amendment and supplement thereto, the prospectus included in such registration
statement (including each preliminary prospectus) and such other documents
as
such seller may reasonably request in order to facilitate the disposition of
the
Registrable Securities owned by such holders;
(d) use
its
Reasonable Best Efforts to register or qualify such Registrable Securities
under
such other securities or blue sky laws of such jurisdictions as such holders
reasonably request and do any and all other acts and things which may be
reasonably necessary or advisable to enable such holders to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
holders; provided,
however,
that the
Company shall not be required to: (i) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
subparagraph; (ii) subject itself to taxation in any such jurisdiction; or
(iii)
consent to general service of process in any such jurisdiction;
(e) notify
such holders, 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 contains an untrue
statement of a material fact or omits any material fact necessary to make the
statements therein, in light of the circumstances in which they are made, not
materially misleading, and, at the reasonable request of such holders, the
Company shall prepare a supplement or amendment to such prospectus so that,
as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus shall not contain an untrue statement of a material fact or omit
to
state any material fact necessary to make the statements therein, in light
of
the circumstances in which they are made, not materially
misleading;
(f) provide
a
transfer agent and registrar for all such Registrable Securities not later
than
the effective date of such registration statement;
(g) make
available for inspection by any underwriter participating in any disposition
pursuant to such registration statement, and any attorney, accountant or other
agent retained by any such underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company’s officers, directors, managers, employees and independent accountants
to supply all information reasonably requested by any such underwriter,
attorney, accountant or agent in connection with such registration
statement;
9
(h) otherwise
use its Reasonable Best Efforts to comply with all applicable rules and
regulations of the SEC, and make available to its security holders, as soon
as
reasonably practicable, an earnings statement of the Company, which earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act
and, at the option of the Company, Rule 158 thereunder;
(i) in
the
event of the issuance of any stop order suspending the effectiveness of a
registration statement, or of any order suspending or preventing the use of
any
related prospectus or suspending the qualification of any Registrable Securities
included in such registration statement for sale in any jurisdiction, the
Company shall use its Reasonable Best Efforts promptly to obtain the withdrawal
of such order;
(j) use
its
Reasonable Best Efforts to cause any Registrable Securities covered by such
registration statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the sellers
thereof to consummate the disposition of such Registrable Securities;
and
(k) if
the
offering is underwritten, use its Reasonable Best Efforts to furnish on the
date
that Registrable Securities are delivered to the underwriters for sale pursuant
to such registration, an opinion dated such date of counsel representing the
Company for the purposes of such registration, addressed to the underwriters
covering such issues as are reasonably required by such
underwriters.
8.5 Listing.
The
Company shall secure the listing of the Common Stock underlying this Warrant
upon each national securities exchange or automated quotation system upon which
shares of Common Stock are then listed or quoted (subject to official notice
of
issuance) and shall maintain such listing of shares of Common Stock. The Company
shall at all times comply in all material respects with the Company’s reporting,
filing and other obligations under the by-laws or rules of the American Stock
Exchange (or such other national securities exchange or market on which the
Common Stock may then be listed, as applicable).
8.6 Expenses.
The Company shall pay all Registration Expenses relating to the registration
and
listing obligations set forth in this Section 8. For purposes of this Warrant,
the term “Registration
Expenses”
means: (a)
all
registration, filing and NASD fees, (b) all reasonable fees and expenses of
complying with securities or blue sky laws, (c) all word processing, duplicating
and printing expenses, (d) the fees and disbursements of counsel for the Company
and of its independent public accountants, including the expenses of any special
audits or “cold comfort” letters required by or incident to such performance and
compliance, (e) premiums and other costs of policies of insurance (if any)
against liabilities arising out of the public offering of the Registrable
Securities being registered if the Company desires such insurance, if any,
and
(f) fees and disbursements of one counsel for the selling holders of Registrable
Securities; provided
however,
that, in
any case where Registration Expenses are not to be borne by the Company, such
expenses shall not include (and such expenses shall be borne by the Company):
(i) salaries of Company personnel or general overhead expenses of the Company,
(ii) auditing fees, (iii) premiums or other expenses relating to liability
insurance required by underwriters of the Company, or (iv) other expenses for
the preparation of financial statements or other data, to the extent that any
of
the foregoing either is normally prepared by the Company in the ordinary course
of its business or would have been incurred by the Company had no public
offering taken place. Registration Expenses shall not include any underwriting
discounts and commissions which may be incurred in the sale of any Registrable
Securities and transfer taxes of the selling holders of Registrable
Securities.
10
8.7 Information
Provided by Holders.
Any
holder of Registrable Securities included in any registration shall furnish
to
the Company such information as the Company may reasonably request in writing
to
enable the Company to comply with the provisions hereof in connection with
any
registration referred to in this Warrant.
8.8 NASD
Cobradesk Filings.
In the
event that a registration statement covering the Registrable Securities is
filed, within one (1) Business Day of the filing of such registration statement,
the Company will prepare and file the selling stockholder resale offering
described in such registration statement for review by the National Association
of Securities Dealers, Inc. (“NASD”)
via
the NASD’s CobraDesk filing system (“CobraDesk
Filing”)
for
the purpose of having the prospectus contained within such registration
statement treated as a “base prospectus” in connection with such resale
offering. The Company will use its Reasonable Best Efforts to have the CobraDesk
Filing approved by the NASD within thirty (30) days of such filing date. The
Company shall bear all expenses of the CobraDesk Filing, including fees and
expenses of counsel or other advisors to the Holder. In all circumstances,
the
Company shall pay for all NASD filing fees associated with the CobraDesk Filing.
8.9 Effectiveness
Period.
The
Company shall use its Reasonable Best Efforts to keep each registration
statement contemplated hereunder continuously effective under the Securities
Act
until the date which is the earlier date of when (i) all Registrable Securities
covered by such Registration Statement have been sold or (ii) all Registrable
Securities covered by such Registration Statement may be sold immediately
without registration under the Securities Act and without volume restrictions
pursuant to Rule 144(k) under the Securities Act, as determined by the counsel
to the Company pursuant to a written opinion letter to such effect, addressed
and reasonably acceptable to the Company’s transfer agent and the affected
holders of Registrable Securities.
8.10 Net
Cash Settlement.
Notwithstanding anything herein to the contrary, in no event will the Holder
hereof be entitled to receive a net-cash settlement as liquidated damages in
lieu of physical settlement in shares of Common Stock, regardless of whether
the
Common Stock underlying this Warrant is registered pursuant to an effective
registration statement; provided, however, that the foregoing will not preclude
the Holder from seeking other remedies at law or equity for breaches by the
Company of its registration obligations hereunder.
11
9. Restrictions
on Transfer.
9.1 Restrictive
Legends.
This
Warrant and each Warrant issued upon transfer or in substitution for this
Warrant pursuant to Section 10 hereof, each certificate for Common Stock issued
upon the exercise of the Warrant and each certificate issued upon the transfer
of any such Common Stock shall be transferable only upon satisfaction of the
conditions specified in this Section 9. Each of the foregoing securities shall
be stamped or otherwise imprinted with a legend reflecting the restrictions
on
transfer set forth herein and any restrictions required under the Securities
Act
or other applicable securities laws.
9.2 Notice
of Proposed Transfer.
Prior
to any transfer of any securities which are not registered under an effective
registration statement under the Securities Act (“Restricted
Securities”),
which
transfer may only occur if there is an exemption from the registration
provisions of the Securities Act and all other applicable securities laws,
the
Holder will give written notice to the Company of the Holder’s intention to
effect a transfer (and shall describe the manner and circumstances of the
proposed transfer). The following provisions shall apply to any proposed
transfer of Restricted Securities:
(i) If
in the
opinion of counsel for the Holder reasonably satisfactory to the Company the
proposed transfer may be effected without registration of the Restricted
Securities under the Securities Act (which opinion shall state in detail the
basis of the legal conclusions reached therein), the Holder shall thereupon
be
entitled to transfer the Restricted Securities in accordance with the terms
of
the notice delivered by the Holder to the Company. Each certificate representing
the Restricted Securities issued upon or in connection with any transfer shall
bear the restrictive legends required by Section 9.1 hereof.
(ii) If
the
opinion called for in (i) above is not delivered, the Holder shall not be
entitled to transfer the Restricted Securities until either: (x) receipt by
the
Company of a further notice from such Holder pursuant to the foregoing
provisions of this Section 9.2 and fulfillment of the provisions of clause
(i)
above, or (y) such Restricted Securities have been effectively registered under
the Securities Act.
9.3 Certain
Other Transfer Restrictions.
Notwithstanding any other provision of this Section 9: (i) prior to the Exercise
Date, this Warrant or the Restricted Securities thereunder may only be
transferred or assigned to the persons permitted under NASD Rule 2710(g), and
(ii) no opinion of counsel shall be necessary for a transfer of Restricted
Securities by the holder thereof to any Person employed by or owning equity
in
the Holder, if the transferee agrees in writing to be subject to the terms
hereof to the same extent as if the transferee were the original purchaser
hereof and such transfer is permitted under applicable securities laws.
9.4
Termination
of Restrictions.
Except
as set forth in Section 9.3 hereof, the restrictions imposed by this Section
9
upon the transferability of Restricted Securities shall cease and terminate
as
to any particular Restricted Securities: (a) which shall have been effectively
registered under the Securities Act, or (b) when, in the opinions of both
counsel for the holder thereof and counsel for the Company, such restrictions
are no longer required in order to insure compliance with the Securities Act
or
Section 10 hereof. Whenever such restrictions shall cease and terminate as
to
any Restricted Securities, the Holder thereof shall be entitled to receive
from
the Company, without expense (other than applicable transfer taxes, if any),
new
securities of like tenor not bearing the applicable legends required by Section
9.1 hereof.
12
10.
Ownership,
Transfer, Sale and Substitution of Warrant.
10.1 Ownership
of Warrant.
The
Company may treat any Person in whose name this Warrant is registered in the
Warrant Register maintained pursuant to Section 10.2(b) hereof as the owner
and
holder thereof for all purposes, notwithstanding any notice to the contrary,
except that, if and when any Warrant is properly assigned in blank, the Company
may (but shall not be obligated to) treat the bearer thereof as the owner of
such Warrant for all purposes, notwithstanding any notice to the contrary.
Subject to Sections 9 and 10 hereof, this Warrant, if properly assigned, may
be
exercised by a new holder without a new Warrant first having been issued.
10.2 Office;
Exchange of Warrant.
(a) The
Company will maintain its principal office at the location identified in the
prospectus relating to the Offering or at such other offices as set forth in
the
Company’s most current filing (as of the date notice is to be given) under the
Exchange Act or as the Company otherwise notifies the Holder.
(b) The
Company shall cause to be kept at its office maintained pursuant to Section
10.2(a) hereof a Warrant Register for the registration and transfer of the
Warrant. The name and address of the holder of the Warrant, the transfers
thereof and the name and address of the transferee of the Warrant shall be
registered in such Warrant Register. The Person in whose name the Warrant shall
be so registered shall be deemed and treated as the owner and holder thereof
for
all purposes of this Warrant, and the Company shall not be affected by any
notice or knowledge to the contrary.
(c) Upon
the
surrender of this Warrant, properly endorsed, for registration of transfer
or
for exchange at the office of the Company maintained pursuant to Section 10.2(a)
hereof, the Company at its expense will (subject to compliance with Section
9
hereof, if applicable) execute and deliver to or upon the order of the Holder
thereof a new Warrant of like tenor, in the name of such holder or as such
holder (upon payment by such holder of any applicable transfer taxes) may
direct, calling in the aggregate on the face thereof for the number of shares
of
Common Stock called for on the face of the Warrant so surrendered (after giving
effect to any previous adjustment(s) to the number of Warrant
Shares).
10.3
Replacement
of Warrant.
Upon
receipt of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant and, in the case of any such loss,
theft or destruction of this Warrant, upon delivery of indemnity reasonably
satisfactory to the Company in form and amount or, in the case of any
mutilation, upon surrender of this Warrant for cancellation at the office of
the
Company maintained pursuant to Section 10.2(a) hereof, the Company, at its
expense, will execute and deliver, in lieu thereof, a new Warrant of like tenor
and dated the date hereof.
13
10.4 Opinions.
In
connection with the sale of the Warrant Shares by Holder, the Company agrees
to
cooperate with the Holder, and at the Company’s expense, have its counsel
provide any legal opinions required to remove the restrictive legends from
the
Warrant Shares in connection with a sale, transfer or legend removal request
of
Holder.
11.
No
Rights or Liabilities as Stockholder.
No
Holder shall be entitled to vote or receive dividends or be deemed the holder
of
any shares of Common Stock or any other securities of the Company which may
at
any time be issuable on the exercise hereof for any purpose, nor shall anything
contained herein be construed to confer upon the Holder, as such, any of the
rights of a stockholder of the Company or any right to vote for the election
of
directors or upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action (whether upon any
recapitalization, issuance of stock, reclassification of stock, change of par
value, consolidation, merger, conveyance, or otherwise) or to receive notice
of
meetings, or to receive dividends or subscription rights or otherwise until
the
Warrant shall have been exercised and the shares of Common Stock purchasable
upon the exercise hereof shall have become deliverable, as provided herein.
The
Holder will not be entitled to share in the assets of the Company in the event
of a liquidation, dissolution or the winding up of the Company.
12.
Notices.
Any
notice or other communication in connection with this Warrant shall be given
in
writing and directed to the parties hereto as follows: (a) if to the Holder,
c/o
Xxxxxx Xxxx, General Counsel, Maxim Group LLC, Fax No: (000) 000-0000; or (b)
if
to the Company, to the attention of its Chief Executive Officer at its office
maintained pursuant to Section 10.2(a) hereof; provided,
that the
exercise of the Warrant shall also be effected in the manner provided in Section
3 hereof. Notices shall be deemed properly delivered and received when delivered
to the notice party (i) if personally delivered, upon receipt or refusal to
accept delivery, (ii) if sent via facsimile, upon mechanical confirmation of
successful transmission thereof generated by the sending telecopy machine,
(iii)
if sent by a commercial overnight courier for delivery on the next Business
Day,
on the first Business Day after deposit with such courier service, or (iv)
if
sent by registered or certified mail, five (5) Business Days after deposit
thereof in the U.S. mail.
13. Payment
of Taxes.
The
Company will pay all documentary stamp taxes attributable to the issuance of
shares of Common Stock underlying this Warrant upon exercise of this Warrant;
provided,
however,
that the
Company shall not be required to pay any tax which may be payable in respect
of
any transfer involved in the transfer or registration of this Warrant or any
certificate for shares of Common Stock underlying this Warrant in a name other
that of the Holder. The Holder is responsible for all other tax liability that
may arise as a result of holding or transferring this Warrant or receiving
shares of Common Stock underlying this Warrant upon exercise
hereof.
14.
Miscellaneous.
This
Warrant and any term hereof may be changed, waived, discharged or terminated
only by an instrument in writing signed by the party against which enforcement
of the change, waiver, discharge or termination is sought. This Warrant shall
be
construed and enforced in accordance with and governed by the laws of the State
of New Jersey. The section headings in this Warrant are for purposes of
convenience only and shall not constitute a part hereof.
14
IN
WITNESS WHEREOF,
the
Company has caused this Underwriters’ Warrant to be duly executed as of the date
first above written.
EYETEL
IMAGING, INC.
By:
________________________________
Name:
Title:
Name:
Title:
15
EXHIBIT
A
FORM
OF EXERCISE NOTICE
[To
be
executed only upon exercise of Warrant]
To
EYETEL
IMAGING, INC.:
The
undersigned registered holder of the within Warrant hereby irrevocably exercises
the Warrant pursuant to Section 3.1 of the Warrant with respect to
________________________ Warrant Shares, at an exercise price per share of
$[ ],
and requests that the certificates for such Warrant Shares be issued, subject
to
Sections 9 and 10, in the name of, and delivered to:
______________________________________
______________________________________
______________________________________
______________________________________
The
undersigned is hereby making payment for the Warrant Shares in the following
manner: [check one]
[ ] by
cash
in accordance with Section 3.1(b) of the Warrant
[ ] via
cashless exercise in accordance with Section 3.1(c) of the Warrant in the
following manner:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
The
undersigned hereby represents and warrants that it is, and has been since its
acquisition of the Warrant, the record and beneficial owner of the
Warrant.
Dated:
_______________
________________________________________
Print
or
Type Name
________________________________________
(Signature
must conform in all respects to name of holder as specified on the face of
Warrant)
________________________________________
(Street
Address)
________________________________________
(City) (State) (Zip Code)
EXHIBIT
B
FORM
OF ASSIGNMENT
[To
be
executed only upon transfer of Warrant]
For
value
received, the undersigned registered holder of the within Warrant hereby sells,
assigns and transfers unto _____________________ [include name and addresses]
the rights represented by the Warrant to purchase __________ shares of Common
Stock of EYETEL IMAGING, INC. to which the Warrant relates, and appoints
_____________________ Attorney to make such transfer on the books of EYETEL
IMAGING, INC. maintained for the purpose, with full power of substitution in
the
premises.
|
Dated:
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________________________________________
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|
(Signature
must conform in all respects to name of holder as specified on
the face of
Warrant)
|
|
|
________________________________________
|
|
|
(Street
Address)
|
|
|
________________________________________
|
|
|
(City) (State) (Zip Code)
|
|
|
Signed
in the presence of:
|
|
|
________________________________________
|
|
|
(Signature
of Transferee)
|
|
|
________________________________________
|
|
|
(Xxxxxx
Xxxxxxx)
|
|
|
________________________________________
|
|
|
(City) (State) (Zip Code)
|
|
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Signed
in the presence of:
|
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