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EXHIBIT 4.2
XXXXX XXXXX CAPITAL GROUP, INC.
AND
FIRST CAMBRIDGE SECURITIES CORPORATION
UNDERWRITER'S WARRANT AGREEMENT FOR SHARES
DATED AS OF ____________, 1997
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UNDERWRITER'S WARRANT AGREEMENT dated as of _____________, 1997
between XXXXX XXXXX CAPITAL GROUP, INC., a Florida corporation (the "Company")
and FIRST CAMBRIDGE SECURITIES CORPORATION, a Representative of the several
Underwriters, a New York corporation (hereinafter referred to variously as the
"Holder" or the "Underwriter").
W I T N E S S E T H :
WHEREAS, the Company proposes to issue to the Underwriter warrants
("Underwriter's Warrants") to purchase up to an aggregate of 170,000 fully paid
non-assessable shares (the "Shares") of the Company's common stock, $.0001 par
value (the "Common Stock") at an exercise price of $7.20 per share (120% of the
public offering price); and
WHEREAS, the Underwriter has agreed pursuant to the underwriting
agreement (the "Underwriting Agreement") dated as of the date hereof between
the Underwriter and the Company, to underwrite the Company's proposed public
offering of 1,700,000 shares of Common Stock at a public offering price of
$6.00 per Share (the "Public Offering"); and
WHEREAS, the Underwriter's Warrants to be issued pursuant to this
Agreement will be issued on the Closing Date (as such term is defined in the
Underwriting Agreement) by the Company to the Underwriter in consideration for,
and as part of the compensation in connection with the Public Offering;
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NOW, THEREFORE, in consideration of the premises, the payment by the
Underwriter to the Company of an aggregate of One Hundred Seventy ($170.00),
the agreements herein set forth and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
x. Xxxxx. The Holder is hereby granted the right to purchase, at any
time from _________________, 1998 until 5:30 P.M., New York time, on
____________, 2002, up to an aggregate of 170,000 Shares at an initial exercise
price (subject to adjustment as provided in Section 8 hereof) of $7.20 per
Share (the "Exercise Price"), subject to the terms and conditions of this
Agreement. Except as set forth herein, the Shares issuable upon exercise of
the Underwriter's Warrants are in all respects identical to the shares of
Common Stock being purchased by the Underwriter for resale to the public
pursuant to the terms and provisions of the Underwriting Agreement.
2. Underwriter's Warrant Certificates. The Underwriter's warrant
certificates (the "Underwriter's Warrant Certificates") delivered and to be
delivered pursuant to this Agreement shall be in the form set forth in Exhibit
A, attached hereto and made a part hereof, with such appropriate insertions,
omissions, substitutions, and other variations as required or permitted by this
Agreement.
3. Exercise of Underwriter's Warrants.
Section 3.1 Exercise. The Underwriter's Warrants initially are
exercisable at an aggregate initial exercise price (subject to adjustment as
provided in Section 8 hereof) per share, as set forth in Section 6 hereof
payable by certified or official bank check in New York Clearing House funds,
subject to adjustment as provided in Section 8 hereof. Upon surrender at the
Company's principal offices in Florida (currently located at 0000 X. Xxxxxx
Xxxx, Boca
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Raton, Florida 33431), of an Underwriter's Warrant Certificate with the annexed
Form of Election to Purchase duly executed, together with payment of the
Purchase Price (as hereinafter defined) for the Shares purchased, the
registered holder of an Underwriter's Warrant Certificate ("Holder" or
"Holders") shall be entitled to receive a certificate or certificates for the
Shares so purchased. The purchase rights represented by each Underwriter's
Warrant Certificate are exercisable at the option of the Holder thereof, in
whole or in part (but not as to fractional shares of Common Stock underlying
the Underwriter's Warrants). In the case of the purchase of less than all the
Shares purchasable under any Underwriter's Warrant Certificate, the Company
shall cancel the Underwriter's Warrant Certificate upon the surrender thereof
and shall execute and deliver a new Underwriter's Warrant Certificate of like
tenor for the balance of the Shares purchasable thereunder.
Section 3.2 Cashless Exercise. At any time during the Warrant
Exercise Term, the Holder may, at its option, exchange the Warrants represented
by such Holder's Warrant certificate, in whole or in part (a "Warrant
Exchange), into the number of fully paid and non-assessable Shares determined
in accordance with this Section 3.2, by surrendering such Warrant certificate
at the principal office of the Company or at the office of its transfer agent,
accompanied by a notice stating such Holder's intent to effect such exchange,
the number of Shares to be exchanged and the date on which the Holder requests
that such Warrant Exchange occur (the "Notice of Exchange"). The Warrant
Exchange shall take place on the date specified in the Notice of Exchange, or,
if later, the date the Notice of Exchange is received by the Company (the
"Exchange Date"). Certificates for the Shares issuable upon such Warrant
Exchange and, if applicable, a new Warrant of like tenor evidencing the balance
of the Shares remaining subject to the Holder's Warrant certificate, shall be
issued
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as of the Exchange Date and delivered to the Holder within three (3) days
following the Exchange Date. In connection with any Warrant Exchange, the
Holder's Warrant certificate shall represent the right to subscribe for and
acquire (I) the number of Shares (rounded to the next highest integer) equal to
(A) the number of Shares specified by the Holder in its Notice of Exchange (the
"Total Share Number") less (B) the number of Shares equal to the quotient
obtained by dividing (i) the product of the Total Share Number and the existing
Exercise Price (as hereinafter defined) per Share by (ii) the Market Price (as
defined in Section 3.3 hereof) of a share of Common Stock.
Section 3.3 Market Price. For the purpose of this Agreement, the
phrase "Market Price" at any date shall be deemed to be the (i) average of the
last reported sale prices for the last three (3) trading days, in either case
as officially reported by the principal securities exchange on which the Common
Stock is listed or admitted to trading, or, (ii) if the Common Stock is not
listed or admitted to trading on any national securities exchange but is listed
or quoted upon the Nasdaq National Market or SmallCap Market (referred to
hereinafter as "NASDAQ"), the average closing bid price for the last three (3)
trading days as furnished by NASDAQ or similar organization if NASDAQ is no
longer reporting such information, or (iii) if the Common Stock is not listed
upon a principal exchange or quoted on NASDAQ, but quotes for the Common Stock
are available in the OTC Bulletin Board or "pink sheets" the average closing
bid price for the last three (3) trading days as furnished on the OTC Bulletin
Board or (iv) in the event the Common Stock is not traded upon a principal
exchange and not listed on NASDAQ and quotes are not available on the OTC
Bulletin Board, as determined in good faith by resolution of the Board of
Directors of the Company, based on the best information available to it.
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4. Issuance of Certificates. Upon the exercise of the Underwriter's
Warrants, the issuance of certificates for the Shares or other securities,
properties or rights underlying such Underwriter's Warrants, shall be made
forthwith (and in any event within five (5) business days thereafter) without
charge to the Holder thereof including, without limitation, any tax which may
be payable in respect of the issuance thereof, and such certificates shall
(subject to the provisions of Sections 5 and 7 hereof) be issued in the name
of, or in such names as may be directed by, the Holder thereof; 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 issuance and delivery of any
such certificates in a name other than that of the Underwriter and the Company
shall not be required to issue or deliver such certificates unless or until the
person or persons requesting the issuance thereof shall have paid to the
Company the amount of such tax or shall have established to the satisfaction of
the Company that such tax has been paid.
The Underwriter's Warrant Certificates and the certificates
representing the Shares issuable upon exercise of the Underwriter's Warrants
shall be executed on behalf of the Company by the manual or facsimile signature
of the then Chairman or Vice Chairman of the Board of Directors or President or
Vice President of the Company under its corporate seal reproduced thereon,
attested to by the manual or facsimile signature of the then present Secretary
or Assistant Secretary of the Company. The Underwriter's Warrant Certificates
shall be dated the date of the execution by the Company upon initial issuance,
division, exchange, substitution or transfer. The certificates representing
the Shares issuable upon exercise of the Underwriter's Warrant shall be
identical in form to those issued in connection with the Public Offering.
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5. Restriction On Transfer of Underwriter's Warrants. The Holder of a
Underwriter's Warrant Certificate, by its acceptance thereof, covenants and
agrees that the Underwriter's Warrants are not being acquired with a view to
the distribution thereof; and that the Underwriter's Warrants may not be sold,
transferred, assigned, hypothecated or otherwise disposed of, in whole or in
part, for a period of one (1) year from the date hereof, except to officers or
employees of the Underwriter or members of the Selling Group.
6. Exercise Price.
Section 6.1 Initial and Adjusted Exercise Price. Except as otherwise
provided in Section 8 hereof, the initial exercise price of each Underwriter's
Warrant shall be $7.20 per Share. The exercise price shall be adjusted from
time to time in accordance with the provisions of Section 8 hereof.
Section 6.2 Exercise Price. The term "Exercise Price" herein shall
mean the initial exercise prices or the adjusted exercise price, depending upon
the context of the Underwriter's Warrants.
7. Registration Rights.
Section 7.1 Registration Under the Securities Act of 1933. The
Underwriter's Warrants and the Shares issuable upon exercise of the
Underwriter's Warrants, have been registered (the "Registration Statement")
under the Securities Act of 1933, as amended (the "Act").
Section 7.2 Piggyback Registration. If, at any time commencing after
____________, 1998 (one (1) year from the Effective Date), through and
including ______________, 2002 (five (5) years from the Effective Date), the
Company proposes to register any of its securities under the Act (other than in
connection with a merger or pursuant to Form S-8 or similar form) it will give
written notice by registered or certified mail, at least thirty (30) days prior
to the filing of
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each such registration statement, to the Underwriter and to all other Holders
of the Underwriter's Warrants and Shares underlying the Underwriter's Warrants,
of its intention to do so. If any of the Underwriter or other Holders of the
Underwriter's Warrants and/or the Shares underlying the Underwriter's Warrants,
notify the Company within twenty (20) days after receipt of any such notice of
its or their desire to include any such securities in such proposed
registration statement, the Company shall afford each of the Underwriter and
such Holders of the Underwriter's Warrants and/or Shares underlying the
Underwriter's Warrants, the opportunity to have any of such securities
registered under such registration statement.
Notwithstanding the provisions of this Section 7.2, the Company shall
have the right at any time after it shall have given written notice pursuant to
this Section 7.2 (irrespective of whether a written request for inclusion of
any such securities shall have been made) to elect not to file any such
proposed registration statement, or to withdraw the same after the filing but
prior to the effective date thereof.
Section 7.3 Demand Registration.
(a) At any time commencing after _______________, 1998 (one (1) year
from the Effective Date) through and including _____________, 2002 (five (5)
years from the effective date), the Holders of the Underwriter's Warrants and
Shares underlying the Underwriter's Warrants, representing a "Majority" of the
shares of Common Stock issuable upon the exercise of the Underwriter's Warrants
(assuming the exercise of all of the Underwriter's Warrants) shall have the
right (which right is in addition to the registration rights under Section 7.2
hereof), exercisable by written notice to the Company, to have the Company
prepare and file with the Commission, at on one occasion, a registration
statement and such other documents, including a prospectus, as may be necessary
in the opinion of both counsel
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for the Company and counsel for the Underwriter and Holders, in order to comply
with the provisions of the Act, so as to permit a public offering and sale of
their respective Underwriter's Warrants and Shares for nine (9) consecutive
months by such Holders and any other Holders of the Underwriter's Warrants and
the Shares who shall notify the Company within ten (10) days after receiving
notice from the Company of such request. Such registration and all costs
incident thereof shall be at the expense of the Company.
(b) The Company covenants and agrees to give written notice of any
registration request under this Section 7.3 by any Holder or Holders to all
other registered Holders of the Underwriter's Warrants and Shares within ten
(10) days from the date of the receipt of any such registration request.
(c) In addition to the registration rights under Section 7.2 and
subsection (a) of this Section 7.3, at any time within the time period
specified in Section 7.4(a) hereof, through and including _______________, 2002
(five (5) years from the Effective Date), any Holder of the Underwriter's
Warrants and/or Shares, representing a "Majority" (as hereinafter defined) of
the shares of Common Stock issuable upon the exercise of the Underwriter's
Warrants (assuming the exercise of all of the Underwriter's Warrants) shall
have the right, exercisable by written request to the Company, to have the
Company prepare and file, on one occasion, with the Commission a registration
statement so as to permit a public offering and sale for nine (9) consecutive
months by any such Holder of its shares, provided, however, that the provisions
of Section 7.4(b) hereof shall not apply to any such registration request and
registration and all costs incident thereto shall be at the expense of the
Holder or Holders making such request.
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(d) Notwithstanding anything to the contrary contained herein, if the
Company shall not have filed a registration statement for the Shares and
Underwriter's Warrants within the time period specified in Section 7.4(a)
hereof pursuant to the written notice specified in Section 7.3(a) of a Majority
of the Holders of the Underwriter's Warrants and Shares, the Company agrees
that upon the written notice of election of a Majority of the Holders of the
Underwriter's Warrants and Shares, it shall repurchase (i) any and all the
Shares underlying previously exercised Underwriter's Warrants at the higher of
the Market Price (as defined in Section 3.3) per share of Common Stock on (x)
the date of the notice sent pursuant to Section 7.3(a) or (y) the expiration of
the period specified in Section 7.4(a) and (ii) any and all Underwriter's
Warrants at the Market Price per share of Common Stock (as of the date
determined in the manner set forth in the foregoing clause (i)) less the
exercise price of such Underwriter's Warrants. Such repurchase shall be in
immediately available funds and shall close within seven (7) days after the
later of (i) the delivery of the written notice of election specified in this
Section 7.3(d) or (ii) the receipt by the Company of all necessary consents or
approvals of governments or third parties to such repurchase.
Section 7.4 Covenants of the Company With Respect to Registration. In
connection with any registration under Section 7.2 or 7.3 hereof, the Company
covenants and agrees as follows:
(a) The Company shall use its best efforts to file a registration
statement within forty-five (45) days of receipt of any demand therefor in
accordance with Section 7.3(a), shall use its best efforts to have any
registration statement declared effective at the earliest possible time, and
shall furnish each Holder desiring to sell the Shares underlying the
Underwriter's Warrants such number of prospectuses as shall reasonably be
requested. Notwithstanding the foregoing sentence, the Company shall be
entitled to postpone the filing of any
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registration statement otherwise required to be prepared and filed by it
pursuant to this Section 7.4(a) if (i) the Company is under contract or other
binding legal obligation for a material acquisition, reorganization or
divestiture, or (ii) the Company is publicly committed to a self-tender or
exchange offer and the filing of a registration statement would cause a
violation of Regulation M under the Act. In the event of such postponement,
the Company shall be required to file the registration statement pursuant to
this Section 7.4(a) upon the earlier of (i) the consummation or termination, as
applicable, of the event requiring such postponement or (ii) 90 days after the
receipt of the initial demand for such registration.
(b) The Company shall pay all costs (excluding fees and expenses of
Holder(s) counsel and any underwriting or selling commissions), fees and
expenses in connection with all registration statements filed pursuant to
Sections 7.2 and 7.3(a) hereof including, without limitation, the Company's
legal and accounting fees, printing expenses, and blue sky fees and expenses.
The Holder(s) will pay all costs, fees and expenses in connection with any
registration statement filed pursuant to Section 7.3(c). If the Company shall
fail to comply with the provisions of Section 7.4(a), the Company shall, in
addition to any other equitable or other relief available to the Holder(s), be
liable for any or all incidental, special and consequential damages and damages
due to loss of profit sustained by the Holder(s) requesting registration of
their Underwriter's Warrants and Shares underlying the Underwriter's Warrants.
(c) The Company will take all necessary action which may be required
in qualifying or registering the Underwriter's Warrants and Shares underlying
the Underwriter's Warrants included in a registration statement for offering
and sale under the securities or blue sky laws of such states as reasonably are
requested by the Holder(s), provided that the Company shall
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not be obligated to execute or file any general consent to service of process
or to qualify as a foreign corporation to do business under the laws of any
such jurisdiction.
(d) The Company shall indemnify the Holder(s) of the Underwriter's
Warrants and Shares to be sold pursuant to any registration statement and each
person, if any, who controls such Holders within the meaning of Section 15 of
the Act or Section 20(a) of the Securities Exchange Act of 1934, as amended
("Exchange Act"), against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which any of them may become subject
under the Act, the Exchange Act or otherwise, arising from such registration
statement but only to the same extent and with the same effect as the
provisions pursuant to which the Company has agreed to indemnify the
Underwriter contained in Section 7 of the Underwriting Agreement.
(e) The Holder(s) of the Underwriter's Warrants and Shares underlying
the Underwriter's Warrants to be sold pursuant to a registration statement, and
their successors and assigns, shall severally, and not jointly, indemnify the
Company, its officers and directors and each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, against all loss, claim, damage or expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which they may become subject under
the Act, the Exchange Act or otherwise, arising from information furnished by
or on behalf of such Holders, or their successors or assigns, for specific
inclusion in such registration statement to the same extent and with the same
effect as the provisions contained in Section 7 of the
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Underwriting Agreement pursuant to which the Underwriter has agreed to
indemnify the Company.
(f) Nothing contained in this Agreement shall be construed as
requiring the Holder(s) to exercise their Underwriter's Warrants prior to the
initial filing of any registration statement or the effectiveness thereof.
(g) The Company shall not permit the inclusion of any securities other
than the Shares underlying the Underwriter's Warrants and Underwriter's
Warrants to be included in any registration statement filed pursuant to Section
7.3 hereof, or permit any other registration statement to become effective
within 120 days of a registration statement filed pursuant to Section 7.3
hereof, without the prior written consent of the Holders of the Underwriter's
Warrants and Shares underlying the Underwriter's Warrants representing a
majority of the shares of Common Stock issuable upon the exercise of such
Underwriter's Warrants.
(h) If the Shares underlying the Shares underlying the Underwriter's
warrants are to be sold in an underwritten public offering, the Company shall
use its best efforts to furnish to each Holder participating in the offering
and to each such underwriter, a signed counterpart, addressed to such
underwriter, of (i) an opinion of counsel to the Company dated the date of the
closing under the underwriting agreement, and (ii) a "cold comfort" letter
dated the date of the closing under the underwriting agreement signed by the
independent public accountants who have issued a report on the Company's
financial statements included in such registration statement, in each case
covering substantially the same matters with respect to such registration
statement (and the prospectus included therein) and, in the case of such
accountants' letter, with respect to events subsequent to the date of such
financial
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statements, as are customarily covered in opinions of issuer's counsel and in
accountants' letters delivered to underwriters in underwritten public offerings
of securities.
(i) The Company shall as soon as practicable after the effective date
of the registration statement, and in any event within 15 months thereafter,
have made "generally available to its security holders" (within the meaning of
Rule 158 under the Act) an earnings statement (which need not be audited)
complying with Section 11(a) of the Act and covering a period of at least 12
consecutive months beginning after the effective date of the registration
statement.
(j) The Company shall deliver promptly to each Holder participating in
the offering requesting the correspondence and memoranda described below, and
the managing underwriters, copies of all correspondence between the Commission
and the Company, its counsel or auditors and all memoranda relating to
discussions with the Commission or its staff with respect to the registration
statement and permit each Holder and underwriter to do such investigation, upon
reasonable advance notice, with respect to information contained in or omitted
from the registration statement as it deems reasonably necessary to comply with
applicable securities laws or rules of the National Association of Securities
Dealers, Inc. ("NASD"). Such investigation shall include access to books,
records and properties and opportunities to discuss the business of the Company
with its officers and independent auditors, all to such reasonable extent and
at such reasonable times and as often as any such Holder shall reasonably
request.
(k) The Company shall enter into an underwriting agreement with the
managing underwriter(s) selected for such underwriting, if any, by Holders
holding a Majority of the Underwriter's Warrants and Shares underlying the
Underwriter's Warrants requested to be
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included in such underwriting. Such underwriting agreement shall be
satisfactory in form and substance to the Company, each Holder and such
managing underwriters, and shall contain such representations, warranties and
covenants by the Company and such other terms as are customarily contained in
agreements of that type used by the managing underwriter(s).
The Holders shall be parties to any underwriting agreement relating to
an underwritten sale of their Underwriter's Warrants and the Shares underlying
the Underwriter's Warrants and may, at their option, require that any or all
the representations, warranties and covenants of the Company to or for the
benefit of such underwriter(s) shall also be made to and for the benefit of
such Holders. Such Holders shall not be required to make any representations
or warranties to or agreements with the Company or the underwriter(s) except as
they may relate to such Holders, their intended methods of distribution, and
except for matters related to disclosures with respect to such Holders,
contained or required to be contained, in such registration statement under the
Act and the rules and regulations thereunder.
(1) For purposes of this Agreement, the term "Majority" in reference
to the Holders of Underwriter's Warrants and Shares, shall mean in excess of
fifty percent (50%) of the then outstanding Shares, assuming the full exercise
of all Underwriter's Warrants 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 families, persons acting as nominees or
in conjunction therewith or (ii) have not been resold to the public pursuant to
Rule 144 under the Act or a registration statement filed with the Commission
under the Act.
8. Adjustments to Exercise Price and Number of Securities.
Section 8.1 Subdivision and Combination. In case the Company shall at
any time subdivide or combine the outstanding shares of Common Stock, the
Exercise Price of the Underwriter's
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Warrants shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
Section 8.2 Adjustment in Number of Securities. Upon each adjustment
of the Exercise Price of the Underwriter's Warrants, pursuant to the provisions
of this Section 8, the number of shares issuable upon the exercise of the
Underwriter's Warrants, shall be adjusted to the nearest full amount by
multiplying a number equal to the exercise price in effect immediately prior to
such adjustment by the number of shares of Common Stock issuable upon exercise
of the Underwriter's Warrants immediately prior to such adjustment and dividing
the product so obtained by the adjusted Exercise Prices.
Section 8.3 Definition of Common Stock. For the purpose of this
Agreement, the term "Common Stock" shall mean (i) the class of stock designated
as Common Stock in the Certificate of Incorporation of the Company as amended
as of the date hereof, or (ii) any other class of stock resulting from
successive changes or reclassifications of such Common Stock, consisting solely
of changes in par value, or from par value to no par value, or from no par
value to par value. In the event that the Company shall after the date hereof
issue common securities with greater or superior voting rights than the shares
of Common Stock outstanding as of the date hereof, the Holder, at its option,
may receive upon exercise of any Underwriter's Warrant, either shares of Common
Stock or a like number of such securities with greater or superior voting
rights.
Section 8.4 Merger or Consolidation. In case of any consolidation of
the Company with, or merger of the Company with, or merger of the Company into,
another corporation (other than a consolidation or merger which does not result
in any reclassification or change of the outstanding Common Stock), the
corporation formed by such consolidation or merger shall
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execute and deliver to the Holder a supplemental warrant agreement providing
that the Holder shall have the right thereafter (until the expiration of such
warrant) to receive, upon exercise of such warrant, the kind and amount of
shares of stock and other securities and property receivable upon such
consolidation or merger, by a holder of the number of shares of Common Stock of
the Company for which such warrant might have been exercised immediately prior
to such consolidation, merger, sale or transfer. Such supplemental warrant
agreement shall provide for adjustments which shall be identical to the
adjustments provided in Section 8. The above provision of this subsection shall
similarly apply to successive consolidations or mergers.
Section 8.5 No Adjustment of Exercises Price in Certain Cases. No
adjustment of the Exercise Price of the Underwriter's Warrants shall be made:
(a) Upon the issuance or sale of the Underwriter's Warrants or
Shares issuable upon the exercise of the Underwriter's Warrants or the
exercise of options and warrants outstanding on the date hereof and
described in the prospectus relating to the Public Offering; or
(b) If the amount of such adjustment shall be less than two
cents ($.02) per share of Common Stock, provided, however, that in
such case any adjustment that would otherwise be required then to be
made shall be carried forward and shall be made at the time of and
together with the next subsequent adjustment which, together with any
adjustment so carried forward, shall amount to at least two cents
($.02) per share of Common Stock.
9. Exchange and Replacement of Underwriter's Warrant Certificates.
Each Underwriter's Warrant Certificate is exchangeable without expense, upon
the surrender
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thereof by the registered Holder at the principal executive office of the
Company, for a new Underwriter's Warrant Certificate of like tenor and date
representing in the aggregate the right to purchase the same number of Shares
as provided in the original Underwriter's Warrants in such denominations as
shall be designated by the Holder thereof at the time of such surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of any Underwriter's Warrant
Certificate, and, in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and reimbursement to the Company of all
reasonable expenses incidental thereto, and upon surrender and cancellation of
the Underwriter's Warrants, if mutilated, the Company will make and deliver a
new Underwriter's Warrant Certificate of like tenor, in lieu thereof.
10. Elimination of Fractional Interests. The Company shall not be
required to issue certificates representing fractions of shares of Common Stock
upon the exercise of the Underwriter's Warrants, nor shall it be required to
issue scrip or pay cash in lieu of fractional interests, it being the intent of
the parties that all fractional interests shall be eliminated by rounding any
fraction up to the nearest whole number of shares of Common Stock or other
securities, properties or rights.
11. Reservation and Listing of Securities. The Company shall at all
times reserve and keep available out of its authorized shares of Common Stock,
solely for the purpose of issuance upon the exercise of the Underwriter's
Warrants, such number of shares of Common Stock or other securities, properties
or rights as shall be issuable upon the exercise thereof. The Company covenants
and agrees that, upon exercise of the Underwriter's Warrants and payment of the
Exercise Price therefor, all shares of Common Stock and other
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securities issuable upon such exercise shall be duly and validly issued, fully
paid, non-assessable and not subject to the preemptive rights of any
stockholder. As long as the Underwriter's Warrants shall be outstanding, the
Company shall use its best efforts to cause all shares of Common Stock issuable
upon the exercise of the Underwriter's Warrants to be listed (subject to
official notice of issuance) on all securities exchanges on which the Common
Stock issued to the public in connection herewith may then be listed and/or
quoted on NASDAQ.
12. Notices to Underwriter's Warrant Holders. Nothing contained in
this Agreement shall be construed as conferring upon the Holders the right to
vote or to consent or to receive notice as a stockholder in respect of any
meetings of stockholders for the election of directors or any other matter, or
as having any rights whatsoever as a stockholder of the Company. If, however,
at any time prior to the expiration of the Underwriter's Warrants and their
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
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(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 such events the Company shall give written notice
to the Holders of such event 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 stockholders entitled to such dividend, distribution,
convertible or exchangeable securities or subscription rights, or entitled to
vote on such proposed dissolution, liquidation, winding up or sale. 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 the issuance of any convertible
or exchangeable securities, or subscription 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 registered Holder of the Underwriter's Warrants,
to the address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in Section 3
hereof or to such other address as the Company may designate by notice
to the Holders.
14. Supplements and Amendments. The Company and the Underwriter may
from time to time supplement or amend this Agreement without the approval of
any holders of
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Underwriter's Warrant Certificates (other than the Underwriter) 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 Company and the Underwriter may deem necessary or desirable and which the
Company and the Underwriter deem shall not adversely affect the interests of
the Holders of Underwriter's Warrant Certificates.
15. Successors. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit of the Company, the Holders and
their respective successors and assigns hereunder.
16. Termination. This Agreement shall terminate at the close of
business on ______________, 2002. Notwithstanding the foregoing, the
indemnification provisions of Section 7 shall survive such termination until
the close of business on _____________, 2012.
17. Governing Law: Submission to Jurisdiction. This Agreement and each
Underwriter's Warrant Certificate issued hereunder shall be deemed to be a
contract made under the laws of the State of New York and for all purposes
shall be construed in accordance with the laws of such State without giving
effect to the rules of said State governing the conflicts of laws.
The Company, the Underwriter and the Holders hereby agree that any
action, proceeding or claim against it arising out of, or relating in any way
to, this Agreement shall be brought and enforced in the courts of the State of
New York or of the United States of America for the Southern District of New
York, and irrevocably submits to such jurisdiction, which jurisdiction shall be
exclusive. The Company, the Underwriter and the Holders hereby
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irrevocably waive any objection to such exclusive jurisdiction or inconvenient
forum. Any such process or summons to be served upon any of the Company, the
Underwriter and the Holders (at the option of the party bringing such action,
proceeding or claim) may be served by transmitting a copy thereof, by
registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in Section 13 hereof. Such mailing
shall be deemed personal service and shall be legal and binding upon the party
so served in any action, proceeding or claim. The Company, the Underwriter and
the Holders agree that the prevailing party(ies) in any such action or
proceeding shall be entitled to recover from the other party(ies) all of
its/their reasonable legal costs and expenses relating to such action or
proceeding and/or incurred in connection with the preparation therefor.
18. Entire Agreement: Modification. This Agreement (including the
Underwriting Agreement to the extent portions thereof are referred to herein)
contains the entire understanding between the parties hereto with respect to
the subject matter hereof and, except as provided in Section 14 hereof, may not
be modified or amended except by a writing duly signed by the party against
whom enforcement of the modification or amendment is sought.
19. Severability. If any provision of this Agreement shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
20. Captions. The caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive
effect.
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21. Benefits or this Agreement. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and the
Underwriter and any other registered Holder(s) of the Underwriter's Warrant
Certificates or Shares underlying the Underwriter's Warrants any legal or
equitable right, remedy or claim under this Agreement; and this Agreement shall
be for the sole and exclusive benefit of the Company and the Underwriter and
any other Holder(s) of the Underwriter's Warrant Certificates or Shares.
22. Counterparts. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and the
same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
[SEAL] XXXXX XXXXX CAPITAL GROUP, INC.
By
-------------------------------------
Name:
Title:
Attest:
------------------------
Secretary
FIRST CAMBRIDGE SECURITIES CORPORATION
By
-------------------------------------
Name:
Title:
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EXHIBIT A
[FORM OF UNDERWRITER'S WARRANT CERTIFICATE]
THE UNDERWRITER'S WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER
SECURITIES ISSUABLE UPON EXERCISE THEREOF MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933, (ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER SUCH ACT (OR ANY SIMILAR
RULE UNDER SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (iii) AN
OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL
FOR THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS
AVAILABLE.
THE TRANSFER OR EXCHANGE OF THE UNDERWRITER'S WARRANTS REPRESENTED BY THIS
CERTIFICATE IS RESTRICTED IN ACCORDANCE WITH THE UNDERWRITER'S WARRANT
AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., NEW YORK TIME, ___________, 2002
No. W-1 170,000 Underwriter's Warrants
Underwriter's Warrant Certificate
This Underwriter's Warrant Certificate certifies that First Cambridge
Securities Corporation, or registered assigns, is the registered holder of
170,000 Underwriter's Warrants to purchase initially, at any time from
______________, 1998 [one year from the consummation of the offering] until
5:30 p.m. New York time on _______________, 2002 [five years from the
consummation of the offering] ("Expiration Date"), up to 170,000 fully-paid and
non-assessable shares of Common Stock, par value $.0001 per share (the
"Warrants") of Xxxxx Xxxxx Capital Group, Inc., a Florida corporation (the
"Company"), at an initial exercise price, subject to adjustment in certain
events (the "Exercise Price"), of $7.20 per Share upon surrender of this
Underwriter's Warrant Certificate and payment of the Exercise Price at an
office or agency of the Company, but subject to the conditions set forth herein
and in the warrant agreement dated as of ____________, 1997 between the Company
and First Cambridge Securities Corporation (the "Underwriter's Warrant
Agreement"). Payment of the Exercise Price shall be made by certified or
official bank check in New York Clearing House funds payable to the order of
the Company.
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No Underwriter's Warrant may be exercised after 5:30 p.m., New York
time, on the Expiration Date, at which time all Underwriter's Warrants
evidenced hereby, unless exercised prior thereto, shall thereafter be void.
The Underwriter's Warrants evidenced by this Underwriter's Warrant
Certificate are part of a duly authorized issue of warrants pursuant to the
Underwriter's Warrant Agreement, which Underwriter's Warrant Agreement is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the holders
(the words "holders" or "holder" meaning the registered holders or registered
holder) of the Underwriter's Warrants.
The Underwriter's Warrant Agreement provides that upon the occurrence
of certain events the exercise price and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the holder, issue a new
Underwriter's Warrant Certificate evidencing the adjustment in the exercise
price and the number and/or type of securities issuable upon the exercise of
the Underwriter's Warrants; provided, however, that the failure of the Company
to issue such new Underwriter's Warrant Certificates shall not in any way
change, alter or otherwise impair, the rights of the holder as set forth in the
Underwriter's Warrant Agreement.
Upon due presentment for registration of transfer of this
Underwriter's Warrant Certificate at an office or agency of the Company, a new
Underwriter's Warrant Certificate or Underwriter's Warrant Certificates of like
tenor and evidencing in the aggregate a like number of Underwriter's Warrants
shall be issued to the transferee(s) in exchange for this Underwriter's Warrant
Certificate, subject to the limitations provided herein and in the
Underwriter's Warrant Agreement, without any charge except for any tax or other
governmental charge imposed in connection with such transfer.
Upon the exercise of less than all of the Underwriter's Warrants
evidenced by this Certificate, the Company shall forthwith issue to the holder
hereof a new Underwriter's Warrant Certificate representing such number of
unexercised Underwriter's Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Underwriter's Warrant Certificate (notwithstanding
any notation of ownership or other writing hereon made by anyone), for the
purpose of any exercise hereof, and of any distribution to the holder(s)
hereof, and for all other purposes, and the Company shall not be affected by
any notice to the contrary.
All terms used in this Underwriter's Warrant Certificate which are
defined in the Underwriter's Warrant Agreement shall have the meanings assigned
to them in the Underwriter's Warrant Agreement.
IN WITNESS WHEREOF, the Company has caused this Underwriter's Warrant
Certificate to be duly executed under its corporate seal.
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Dated as of ___________________, 1997
XXXXX XXXXX CAPITAL GROUP, INC.
[SEAL] By
---------------------------------
Name:
Title:
Attest:
---------------------------
Secretary
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[FORM OF ELECTION TO PURCHASE]
The undersigned hereby irrevocably elects to exercise the right,
represented by this Underwriter's Warrant Certificate, to purchase
shares of Common Stock and herewith tenders in payment for such securities a
certified or official bank check payable in New York Clearing House Funds to
the order of Xxxxx Xxxxx Capital Group, Inc. in the amount of $ ,
all in accordance with the terms hereof. The undersigned requests that a
certificate for such securities be registered in the name of
whose address is and that such Certificate be delivered to
whose address is .
Dated:
Signature ________________
(Signature must conform in all respects
to name of holder as specified on the
face of the Underwriter's Warrant Certificate.)
--------------------------
Insert Social Security or Other
Identifying Number of Holder)