EXHIBIT 4.1
WARRANT AGREEMENT
METEOR INDUSTRIES, INC.
AND
AMERICAN SECURITIES TRANSFER & TRUST, INC.
WARRANT AGENT
------------, 1996
THIS AGREEMENT (the "Agreement") is dated as of ------------, 1996, between
Meteor Industries, Inc., a Colorado corporation (the "Company"), and American
Securities Transfer & Trust, Inc., Lakewood, Colorado (the "Warrant Agent").
WHEREAS, the Company proposes to offer to the public up to 690,000 shares
of common stock, $.001 par value (the "Common Stock") of the Company and 690,000
Redeemable Common Stock Purchase Warrants (the "Warrants"), with each such
Warrant entitling the holder to purchase one share of Common Stock;
WHEREAS, the Company desires to provide for issuance of warrant
certificates
(the "Warrant Certificates") representing the Warrants; and
WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing so to act, in connection with the
issuance, registration, transfer and exchange of Warrant Certificates and
exercise of the Warrants,
NOW, THEREFORE, in consideration of the promises and the mutual agreements
hereinafter set forth, it is agreed that:
1. WARRANTS/WARRANT CERTIFICATES. Each Warrant shall entitle the holder
(the "Registered Holder" or, in the aggregate, the "Registered Holders") in
whose
name the Warrant Certificate shall be registered on the books maintained by the
Warrant Agent to purchase one share of Common Stock of the Company on exercise
thereof, subject to modification and adjustment as provided in Section 8.
A copy
of the form of Warrant Certificate is attached hereto as Exhibit A.
Warrant Certificates representing the right to purchase Warrant Shares
shall be executed by the Company's President and attested to by the Company's
Secretary or Assistant Secretary and delivered to the Warrant Agent upon
execution of this Agreement.
Subject to the provisions of Sections 3, 5, 6 and 7, the Warrant Agent
shall deliver Warrant Certificates in required whole number denominations to
Registered Holders in connection with any transfer or exchange permitted under
this Agreement. Except as provided in Section 6 hereof, no Warrant Certificates
shall be issued except (i) Warrant Certificates initially issued hereunder, (ii)
Warrant Certificates issued on or after the initial issuance date, upon the
exercise of any Warrants, to evidence the unexercised Warrants held by the
exercising Registered holder, and (iii) Warrant Certificates issued after the
initial issuance date, upon any transfer or exchange of Warrant Certificates or
replacements of lost or mutilated Warrant Certificates.
2. FORM AND EXECUTION OF WARRANT CERTIFICATES. The Warrant Certificates
shall be substantially in the form attached as Exhibit A. The Warrant
Certificates shall be dated as of the date of their issuance, whether on initial
issuance, transfer or exchange or in lieu of mutilated, lost, stolen or
destroyed
Warrant Certificates.
Each such Warrant Certificate shall be numbered serially in accordance
with the Common Stock initially attached thereto with the letter "W" appearing
on each Warrant Certificate. The Warrant Certificates may be detached
immediately, and, in such event, the Warrant Certificates may be issued by
number
preceded by the letter "W" without regard to the number of the certificate
representing the Common Stock initially attached thereto.
The Warrant Certificates shall be manually countersigned by the
Warrant
Agent and shall not be valid for any purpose unless so countersigned. In the
event any officer of the Company who executed the Warrant Certificates shall
cease to be an officer of the Company before the date of issuance of the Warrant
Certificates or before countersignature and delivery by the Warrant Agent, such
Warrant Certificates may be countersigned, issued and delivered by the Warrant
Agent with the same force and effect as though the person who signed such
Warrant
Certificates had not ceased to be an officer of the Company.
3. EXERCISE. Subject to the provisions of Sections 4, 7 and 8, each
Warrant may be exercised to purchase one share of Common Stock at a price (the
"Exercise Price") of $---- at any time during the period (the "Exercise Period")
commencing on the date (the "Initial Exercise Date") of the Company's Prospectus
(therefore, commencing on ----------, 1996) and terminating on a date (the
"Expiration Date") two (2) years after the date of the Company's Prospectus
(therefore, terminating on ------------, 1998), unless extended by a majority
vote of the Company's Board of Directors at its discretion. The Company shall
promptly notify the Warrant Agent of any extension of the Exercise Period of the
Warrants. A Warrant shall be deemed to have been exercised immediately prior to
the close of business on the date (the "Exercise Date") of the surrender for
exercise of the Warrant Certificate. The exercise form shall be executed by the
Registered Holder thereof or his attorney duly authorized in writing and will be
delivered together with payment to the Warrant Agent at American Securities
Transfer & Trust, Inc., 000 Xxxxx Xxxxxx, Xx. 000, Xxxxxxxx, Xxxxxxxx 00000 (the
"Corporate Office"), in cash or by official bank or certified check, of an
amount
equal to the aggregate applicable Exercise Price, in lawful money of the United
States of America.
Unless Warrant Shares may not be issued as provided herein, the person
entitled to receive the number of Warrant Shares deliverable on such exercise
shall be treated for all purposes as the holder of such Warrant Shares as of the
close of business on the Exercise Date. In addition, the Warrant Agent shall
also, at such time, verify that all of the conditions precedent to the issuance
of Warrant Shares set forth in Section 4 have been satisfied as of the Exercise
Date. If any one of the conditions precedent set forth in Section 4 are not
satisfied as of the Exercise Date, the Warrant Agent shall request written
instructions from the Company as to whether to return the Warrant and Exercise
Price to the exercising Registered Holder or to hold the same until all such
conditions have been satisfied. The Company shall not be obligated to issue any
fractional share interests in Warrant Shares issuable or deliverable on the
exercise of any Warrant or scrip or cash therefore and such fractional shares
shall be of no value whatsoever. If more than one Warrant shall be exercised at
one time by the same Registered Holder, the number of full Shares which shall be
issuable on exercise thereof shall be computed on the basis of the aggregate
number of full shares issuable on such exercise.
Within thirty days after the Exercise Date, and in any event prior to
the applicable Expiration Date, pursuant to a Stock Transfer Agreement between
the Company and Warrant Agent, the Warrant Agent shall cause to be issued and
delivered to the person or persons entitled to receive the same, a certificate
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or certificates for the number of Warrant Shares deliverable on such exercise.
No adjustment shall be made in respect of cash dividends on Warrant Shares
delivered on exercise of any Warrant. The Warrant Agent shall promptly notify
the Company in writing of any exercise and of the number of Warrant Shares
delivered and shall cause payment of an amount in cash equal to the Exercise
Price to be promptly made to the order of the Company.
Upon the exercise of any Warrant, the Warrant Agent shall promptly
deposit the payment into an escrow account established by mutual agreement
of the
Company and the Warrant Agent at a federally insured commercial bank. All funds
deposited in the escrow account will be disbursed on a weekly basis to the
Company once they have been determined by the Warrant Agent to be collected
funds. Once the funds are determined to be collected, the Warrant Agent shall
cause the share certificate(s) representing the exercised Warrants to be issued.
Expenses incurred by American Securities Transfer & Trust, Inc. while
acting in the capacity as Warrant Agent will be paid by the Company. These
expenses, including delivery of exercised share certificates to the shareholder,
will be deducted from the exercise fee submitted prior to distribution of funds
to the Company.
A detailed accounting statement relating to the number of shares
exercised and the net amount of exercised funds remitted will be given to the
Company with the payment of each exercise amount. This will serve as an interim
accounting for the Company's use during the Exercise Period. A complete
accounting will be made by the Warrant Agent to the Company concerning all
persons exercising Warrants, the number of shares issued and the amounts paid at
the completion of the Exercise Period.
The Company may deem and treat the Registered Holder of the Warrants
at any time as the absolute owner thereof for all purposes, and the Company
shall
not be affected by any notice to the contrary. The Warrants shall not entitle
the holder thereof to any of the rights of shareholders or to any dividend
declared on the Common Stock unless the holder shall have exercised the Warrants
and purchased the shares of Common Stock prior to the record date fixed by the
Board of Directors of the Company for the determination of holders of Common
Stock entitled to such dividend or other right.
4. RESERVATION OF SHARES AND PAYMENT OF TAXES. The Company covenants
that
it will at all times reserve and have available from its authorized Common Stock
such number of shares as shall then be issuable on the exercise of all
outstanding Warrants. The Company covenants that all Warrant Shares which shall
be so issuable shall be duly and validly issued, fully paid and nonassessable,
and free from all taxes, liens and charges with respect to the
issue thereof.
The Company and the Warrant Agent acknowledge that the Company
will be required, pursuant to the Securities Act of 1933, as amended (the
"Act"), to deliver to each Registered Holder, upon the exercise of Warrants
and delivery of Warrant Shares, a prospectus covering the issuance of the
Warrant Shares which meets the requirements of the Act, which prospectus must
be a part of an effective registration statement under the Act at the time
that the Warrant is exercised. No Warrants may be exercised nor may Warrant
shares be issued by the Company's transfer agent or delivered by the Warrant
Agent unless, on the pertinent Exercise Date: (i) the Company has an
effective registration statement covering the issuance of the Warrant Shares
under the Act; (ii) the Warrant Agent has copies of the prospectus which is a
part of such effective registration statement and which the Warrant Agent
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hereby agrees to deliver with the Warrant Shares; and (iii) the Warrant Shares
may legally be issued and delivered to the exercising Registered Holder under
the securities laws of the state in which such Registered Holder resides.
The Company agrees to use its best efforts to maintain, to the
extent required by the Act, an effective registration statement under the Act
covering the issuance of the Warrant Shares during the period the Warrants are
exercisable. The Company further agrees, from time to time, to furnish the
Warrant Agent with copies of the Company's prospectus to be delivered to
exercising Registered Holders, as set forth above.
If any shares of Common Stock to be reserved for the purpose of
exercise of Warrants hereunder require any other registration with or approval
of any government authority under any federal or state law before such shares
may be validly issued or delivered, then the Company covenants that it will in
good faith and as expeditiously as possible endeavor to secure such registra-
tion or approval, as the case may be. No Warrant Shares shall be issued
unless and until any such registration requirements have been satisfied.
The Registered Holder shall pay all documentary, stamp or similar
taxes and other government charges that may be imposed with respect of the
issuance of the Warrants, or the issuance, transfer or delivery of any Warrant
Shares on exercise of the Warrants. In the event the Warrant Shares are to be
delivered in a name other than the name of the Registered Holder of the
Warrant Certificate, no such delivery shall be made unless the person
requesting the same has paid to the Warrant Agent the amount of any such taxes
or charges incident thereto.
In the event the Warrant Agent ceases to also serve as the stock
transfer agent for the Company, the Warrant Agent is irrevocably authorized to
requisition the Company's new transfer agent from time to time for
Certificates of Warrant Shares required upon exercise of the Warrants, and the
Company will authorize such transfer agent to comply with all such requisi-
tions. The Company will file with the Warrant Agent a statement setting forth
the name and address of its new transfer agent, for shares of Common Stock or
other capital stock issuable upon exercise of the Warrants and of each
successor transfer agent.
5. REGISTRATION OF TRANSFER. The Warrant Certificates may be
transferred in whole or in part. Warrant Certificates to be exchanged shall
be surrendered to the Warrant Agent at its Corporate Office. The Company
shall execute and the Warrant Agent shall countersign, issue and deliver in
exchange therefor the Warrant Certificate or Certificates which the holder
making the transfer shall be entitled to receive.
The Warrant Agent shall keep transfer books at its Corporate
Office which shall register Warrant Certificates and the transfer thereof. On
due presentment for registration of transfer of any Warrant Certificate at
such office, the Company shall execute and the Warrant Agent shall issue and
deliver to the transferee or transferees a new Warrant Certificate or
Certificates representing an equal aggregate number of Warrants. All Warrant
Certificates presented for registration of transfer or exercise shall be duly
endorsed or be accompanied by a written instrument or instruments or transfer
in form satisfactory to the Company and the Warrant Agent. At the time of
exercise, the transfer fee shall be paid by the Holder. The Company may
require payment of a sum sufficient to cover any tax or other government
charge that may be imposed in connection therewith.
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All Warrant Certificates so surrendered, or surrendered for
exercise, or for exchange in case of mutilated Warrant Certificates, shall be
promptly cancelled by the Warrant Agent and thereafter retained by the Warrant
Agent until termination of the agency created by this Agreement. Prior to due
presentment for registration of transfer thereof, the Company and the Warrant
Agent may treat the Registered Holder of any Warrant Certificate as the
absolute owner thereof (notwithstanding any notations of ownership or writing
thereon made by anyone other than the Company or the Warrant Agent), and the
parties hereto shall not be affected by any notice to the contrary.
6. LOSS OR MUTILATION. On receipt by the Company and the Warrant
Agent of evidence satisfactory as to the ownership of and the loss, theft,
destruction or mutilation of any Warrant Certificate, the Company shall
execute, and the Warrant Agent shall countersign and deliver in lieu thereof,
a new Warrant Certificate representing an equal aggregate number of Warrants.
In the case of loss, theft or destruction of any Warrant Certificate, the
individual requesting issuance of a new Warrant Certificate shall be required
to indemnify the Company and Warrant Agent in an amount satisfactory to each
of them. In the event a Warrant Certificate is mutilated, such Certificate
shall be surrendered and cancelled by the Warrant Agent prior to delivery of a
new Warrant Certificate. Applicants for a new Warrant Certificate shall also
comply with such other regulations and pay such other reasonable charges as
the Company may prescribe.
7. CALL OPTION. Following issuance of the Warrants, in the event
that the trading price of the Company's Common Stock exceeds $--- for 10
consecutive trading days ending not more than ten days prior to the mailing of
the notice of redemption, the Company shall have the right and option, upon 30
days' written notice to each Registered Holder, to call, redeem and acquire
all of the Warrants remaining outstanding and unexercised at the date fixed
for such redemption in such notice (the "Redemption Date"), which Redemption
Date shall be 30 days after the date of such notice, for an amount equal to
$.10 per Warrant; provided, however, that the Registered Holders shall in any
event have the right during the 30-day period immediately following the date
of such notice to exercise the Warrants being called for redemption in
accordance with the provisions of Section 3 hereof. For the purposes of
determining the daily trading price of the Company's Common Stock, if the
Common Stock is listed on a national securities exchange, is admitted to
unlisted trading privileges on a national securities exchange, or is on
NASDAQ, then the last reported sale price of the Common Stock on such exchange
or NASDAQ each day shall be used. If the Common Stock is not so listed on
such exchange or system or admitted to unlisted trading privileges then the
average of the last reported bid prices reported by the OTC Bulletin Board
each day shall be used to determine such daily trading price. In the event
that any Warrants called for redemption are exercised during the 30-day period
following the notice of redemption, this call option shall be deemed not to
have been exercised by the Company as to the Warrants so exercised by the
holders thereof. Said notice of redemption shall require each Registered
Holder to surrender to the Company, on the Redemption Date, at the Corporate
Office of the Warrant Agent (or its successor), his certificate or certifi-
xxxxx representing the Warrants to be redeemed. Notwithstanding the fact that
any Warrants called for redemption have not been surrendered for redemption
and cancellation on the Redemption Date, after the Redemption Date, such
Warrants shall be deemed to be expired and all rights of the holders of such
unsurrendered Warrants shall cease and terminate, other than the right to
receive the redemption price of $.10 per Warrant for such Warrants, without
interest, provided, however, that such right to receive the redemption price
of $.10 per Warrant for such Warrants shall itself expire two years from the
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Redemption Date. The Company shall notify the Warrant Agent verbally, with
confirmation in writing, of the call of the Warrants and of the Redemption
Date and the Company shall instruct the Warrant Agent accordingly as to the
procedures to be followed by the Warrant Agent in connection with the
redemption of such Warrants.
8. ADJUSTMENT OF EXERCISE PRICE AND SHARES. After each adjustment of
the Exercise Price(s) pursuant to this Section 8, the number of shares of
Common Stock purchasable upon the exercise of each Warrant shall be the number
receivable upon exercise thereof prior to such adjustment multiplied by a
fraction, the numerator of which shall be the original Exercise Price as
defined in Section 3 above and the denominator of which shall be such adjusted
Exercise Price. The Exercise Price of the Warrants shall be subject to
adjustment as set forth below:
(a)(i) If the Company subdivides its outstanding shares of Common
Stock into a greater number of shares of Common Stock, the Exercise Price in
effect immediately prior to such subdivision shall be proportionately reduced.
Conversely, if the Company combines its outstanding shares of Common Stock
into a lesser number of shares of Common Stock, the Exercise Price in effect
immediately prior to such combination shall be proportionately increased. In
case of a subdivision or combination, the adjustment of the Exercise Price
shall be made as of the effective date of the applicable event. A
distribution on shares of Common Stock, including a distribution of
Convertible Securities, to shareholders of the Company on a pro rata basis
shall be considered a subdivision of shares of Common Stock for the purposes
of this subsection (a)(i) of this Section 8, except that the adjustment will
be made as of the record date for such distribution and any such distribution
of Convertible Securities shall be deemed to be a distribution of the shares
of Common Stock underlying such Convertible Securities.
(ii) If the Company shall at any time distribute or cause
to be distributed to its shareholders, on a pro rata basis, cash or assets of
the Company, or cash, assets, or securities of any entity other than the
Company including a subsidiary of the Company, then the Exercise Price in
effect immediately prior to such distribution shall automatically be reduced
by an amount determined by dividing (x) the amount (if cash) or the value (if
assets or securities) of the holders' of Warrants pro rata share of such
distribution determined assuming that all holders of Warrants had exercised
their Warrants on the day prior to such distribution, by (y) the number of
shares of Common Stock issuable upon the exercise of this Warrant by the
Holder on the day prior to such distribution.
(b) Anything in this Section 8 to the contrary notwithstanding,
the Company shall not be required to give effect to any adjustment in the
Exercise Price unless and until the net effect of one or more adjustments,
determined as above provided, shall have required a change of the Exercise
Price by at least one cent, but when the cumulative net effect of more than
one adjustment so determined shall be to change the actual Exercise Price by
at least one cent, such change in the Exercise Price shall thereupon be given
effect.
(c) Upon any adjustment of the Exercise Price, the Holder of
this Warrant shall thereafter (until another such adjustment) be entitled to
purchase, at the new Exercise Price, the number of shares, calculated to the
nearest full share, obtained by multiplying the number of shares of Common
Stock initially issuable upon exercise of this Warrant by the Exercise Price
specified in the first paragraph hereof and dividing the product so obtained
by the new Exercise Price.
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(d)(i) Whenever reference is made in this Section 8 to the
distribution of shares of Common Stock, the term "Common Stock" shall mean the
Common Stock of the Company authorized as of the date hereof and any other
class of stock ranking on a parity with such Common Stock. However, subject
to the provisions of subsection (e) of this Section 8, shares issuable upon
exercise hereof shall include only shares of the class designated as Common
Stock of the Company as of the date hereof.
(ii) Whenever reference is made in this Section 8 to the
distribution of Convertible Securities, the term "Convertible Securities"
shall mean options or warrants or rights for the purchase of Common Stock of
the Company or for the purchase of any stock or other securities convertible
into or exchangeable for Common Stock of the Company.
(e) In case of any reclassification, capital reorganization or
other change of outstanding shares of Common Stock of the Company (other than
a change in par value or from par value to no par value, or from no par value
to par value, or as a result of an issuance of Common Stock by way of dividend
or other distribution or of a subdivision or combination), or in case of any
consolidation or merger of the Company with or into another corporation (other
than a merger with a subsidiary in which merger the Company is the continuing
corporation and which does not result in any reclassification, capital
reorganization or other change of outstanding shares of Common Stock of the
class issuable upon exercise of this Warrant) or in case of any sale or
conveyance to another corporation of the property of the Company as an
entirety or substantially as an entirety, the Company shall cause effective
provision to be made so that the Holder shall have the right thereafter, by
exercising this Warrant, to purchase the kind and amount of shares of stock
and other securities and property receivable upon such reclassification,
capital reorganization or other change, consolidation, merger, sale or
conveyance. Any such provision shall include provision for adjustments which
shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Warrant. The foregoing provisions of this subsection (e)
shall similarly apply to successive reclassifications, capital reorganizations
and changes of shares of Common Stock and to successive consolidations,
mergers, sales or conveyances. In the event the Company spins off a
subsidiary by distributing to the shareholders of the Company as a dividend or
otherwise the stock of the subsidiary, the Company shall reserve for the life
of this Warrant, shares of the subsidiary to be delivered to the Holders of
the Warrants upon exercise to the same extent as if they were owners of record
of the Warrant Stock on the record date for payment of the shares of the
subsidiary.
(f) Before taking any action which could cause an adjustment
reducing the Exercise Price below the then par value of the shares of Common
Stock issuable upon exercise of any Warrants, the Company will take any
corporate action which may, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully paid and nonassess-
able shares of such Common Stock at such adjusted Exercise Price.
(g)(i) Upon any adjustment of the Exercise Price required to be
made pursuant to this Section 8, the Company within 30 days thereafter shall
(A) cause to be filed with the Warrant Agent a certificate of a firm of
independent accountants setting forth the Exercise Price after such adjustment
and setting forth in reasonable detail the method of calculation and the facts
upon which such calculation is based, which certificate shall be conclusive
evidence of the correctness of such adjustment, and (B) cause to be mailed to
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each of the Registered Holders of the Warrants written notice of such
adjustment. Where appropriate, such notice may not be given in advance and
included as a part of the notice required to be mailed under the provisions of
subsection 8(d)(ii).
(ii) In case at any time:
(A) The Company shall declare any dividend upon its
Common Stock payable otherwise than in cash or in Common Stock of the Company;
or
(B) The Company shall offer for subscription to the
holders of its Common Stock any additional shares of stock of any class or any
other securities convertible into shares of stock or any rights to subscribe
thereto; or
(C) There shall be any capital reorganization or
reclassification of the capital stock of the Company, or a sale of all or
substantially all of the shares of the assets of the Company, or a
consolidation or merger of the Company with another corporation (other than a
merger with a Subsidiary in which merger the Company is the continuing
corporation and which does not result in any reclassification or change of the
then outstanding shares of Common Stock or other capital stock issuable upon
exercise of the Warrants other than a change in par value or from par value to
no par value or from no par value to par value); or
(D) There shall be a voluntary or involuntary
dissolution, liquidation or winding up of the Company;
then, in any one or more of said cases, the Company shall cause to be mailed
to each of the Registered Holders of the Warrants, at the earliest practicable
time (and, in any event, not less than 20 days before any record date or other
date set for definitive action), written notice of the date on which the books
of the Company shall close or a record shall be taken for such dividend,
distribution or subscription rights or such reorganization, reclassification,
sale, consolidation, merger, dissolution, liquidation or winding up shall take
place, as the case may be. Such notice shall also set forth such facts as
shall indicate the effect of such action (to the extent such effect may be
known at the date of such notice) on the Exercise Price and the kind and
amount of the shares of stock and other securities and property deliverable
upon exercise of the Warrants. Such notice shall also specify the date as of
which the holders of the Common Stock of record shall participate in said
dividend, distribution or subscription rights or shall be entitled to exchange
their Common Stock for securities or other property deliverable upon such
reorganization, reclassification, sale, consolidation, merger, dissolution,
liquidation or winding up, as the case may be (on which date, in the event of
voluntary or involuntary dissolution, liquidation or winding up of the
Company, the right to exercise the Warrants shall terminate).
(iii) Without limiting the obligation of the Company to
provide notice to the Registered Holders of the Warrants of corporate actions
hereunder, is agreed that failure of the Company to give notice shall not
invalidate such corporate action of the Company.
9. REDUCTION IN EXERCISE PRICE AT COMPANY'S OPTION. Except for any
adjustments made to the Exercise Price pursuant to Section 8, the Company shall
not reduce the Exercise Price of the Warrants.
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10. DUTIES, COMPENSATION AND TERMINATION OF WARRANT AGENT. The
Warrant Agent shall act hereunder as agent and in a ministerial capacity for
the Company, and its duties shall be determined solely by the provisions
hereof. The Warrant Agent shall not, by issuing and delivering Warrant
Certificates or by any other act hereunder, be deemed to make any
representations as to the validity, value or authorization of the Warrant
Certificates or the Warrants represented thereby or of the Common Stock or
other property delivered on exercise of any Warrant. The Warrant Agent shall
not at any time be under any duty or responsibility to any holder of the
Warrant Certificates to make or cause to be made any adjustment of the
Exercise Price or to determine whether any fact exists which may require any
such adjustments.
The Warrant Agent shall not (i) be liable for any recital or
statement of fact contained herein or for any action taken or omitted by it in
reliance on any Warrant Certificate or other document or instrument believed
by it in good faith to be genuine and to have been signed or presented by the
proper party or parties, (ii) be responsible for any failure on the part of
the Company to comply with any of its covenants and obligations contained in
this Agreement except for its own negligence or willful misconduct, or (iii)
be liable for any act or omission in connection with this Agreement except for
its own negligence or willful misconduct.
The Company agrees to indemnify the Warrant Agent against any and
all losses, expenses and liabilities which the Warrant Agent may incur in
connection with the delivery of copies of the Company's prospectus to
exercising Registered Holders upon the exercise of any Warrants as set forth
in Section 4.
The Warrant Agent may at any time consult with counsel
satisfactory to it (which may be counsel for the Company) and shall incur no
liability or responsibility for any action taken or omitted by it in good
faith in accordance with the opinion or advice of such counsel. Any notice,
statement, instruction, request, direction, order or demand of the Company
shall be sufficiently evidenced by an instrument signed by its President and
attested by its Secretary or Assistant Secretary. The Warrant Agent shall not
be liable for any action taken or omitted by it in accordance with such
notice, statement, instruction, request, order or demand.
The Company agrees to pay the Warrant Agent reasonable
compensation for its services hereunder and to reimburse the Warrant Agent for
its reasonable expenses as per the fee schedule attached hereto as Exhibit B.
The Company further agrees to indemnify the Warrant Agent against any and all
losses, expenses and liabilities, including judgments, costs and counsel fees,
for any action taken or omitted by the Warrant Agent in the execution of its
duties and powers hereunder, excepting losses, expenses and liabilities
arising as a result of the Warrant Agent's negligence or willful misconduct.
The Warrant Agent may resign its duties or the Company may
terminate the Warrant Agent and the Warrant Agent shall be discharged from all
further duties and liabilities hereunder (except liabilities arising as a
result of the Warrant Agent's own negligence or willful misconduct), on 30
days' prior written notice to the other party. At least 15 days prior to the
date such resignation is to become effective, the Warrant Agent shall cause a
copy of such notice of resignation to be mailed to the Registered Holder of
each Warrant Certificate. On such resignation or termination the Company
shall appoint a new warrant agent. If the Company shall fail to make such
appointment within a period of 30 days after it has been notified in writing
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of the resignation by the Warrant Agent, then the registered holder of any
Warrant Certificate may apply to any court of competent jurisdiction for the
appointment of a new warrant agent.
After acceptance in writing of an appointment of a new warrant
agent is received by the Company, such new warrant agent shall be vested with
the same powers, rights, duties and responsibilities as if it had been
originally named herein as the Warrant Agent, without any further assurance,
conveyance, act or deed; provided, however, if it shall be necessary or
expedient to execute and deliver any further assurance, conveyance, act or
deed, the same shall be done at the expense of the Company and shall be
legally and validly executed. The Company shall file a notice of appointment
of a new warrant agent with the resigning Warrant Agent and shall forthwith
cause a copy of such notice to be mailed to the Registered Holder of each
Warrant Certificate.
Any corporation into which the Warrant Agent or any new warrant
agent may be converted or merged, or any corporation resulting from any
consolidation to which the Warrant Agent or any new warrant agent shall be a
party, or any corporation succeeding to the corporate trust business of the
Warrant Agent shall be a successor Warrant Agent under this Agreement,
provided that such corporation is eligible for appointment as a successor to
the Warrant Agent under the provisions of the preceding paragraph. Any such
successor Warrant Agent shall promptly cause notice of its succession as
Warrant Agent to be mailed to the Company and to the Registered Holder of each
Warrant Certificate. No further action shall be required for establishment
and authorization of such successor warrant agent.
The Warrant Agent, its officers or directors and its subsidiaries
or affiliates may buy, hold or sell Warrants or other securities of the
Company and otherwise deal with the Company in the same manner and to the same
extent and with like effect as though it were not Warrant Agent. Nothing
herein shall preclude the Warrant Agent from acting in any other capacity for
the Company or for any other legal entity.
11. MODIFICATION OF AGREEMENT. The Warrant Agent and the Company may
by supplemental agreement make any changes or corrections in this Agreement
(i) that they shall deem appropriate to cure any ambiguity or to correct any
defective or inconsistent provision or mistake or error herein contained; or
(ii) that they may deem necessary or desirable and which shall not adversely
affect the interests of the holders of Warrant Certificates; provided,
however, this Agreement shall not otherwise be modified, supplemented or
altered in any respect except with the consent in writing of the Registered
Holders of Warrant Certificates representing not less than 51% of the Warrants
outstanding. Additionally, except as provided in Section 8, no change in the
number or nature of the Warrant Shares purchasable on exercise of a Warrant,
increase the purchase price therefor, or the acceleration of the Expiration
Date of a Warrant shall be made without the consent in writing of the
Registered Holder of the Warrant Certificate representing such Warrant, other
than such changes as are specifically prescribed or allowed by this Agreement.
12. NOTICES. All notices, demands, elections, opinions or requests
(however characterized or described) required or authorized hereunder shall be
deemed given sufficiently if in writing and sent by registered or certified
mail, return receipt requested and postage prepaid, or by tested telex,
telegram or cable to, in the case of the Company:
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Xxxxxx Xxxxxxxxxx, Inc.
000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
with a copy to:
Xxx X. Xxxxxx
Xxxx Xxxxx Xxxxxxxx Xxxxx & Xxxxxx, P.C.
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
and in the case of the Warrant Agent:
American Securities Transfer & Trust, Inc.
000 Xxxxx Xxxxxx, Xx. 000
Xxxxxxxx, Xxxxxxxx 00000
and if to the Registered Holder of a Purchase Warrant Certificate, at the
address of such holder as set forth on the books maintained by the Warrant
Agent.
13. BINDING AGREEMENT. This Agreement shall be binding upon and inure
to the benefit of the Company, the Warrant Agent and their respective
successors and assigns, and the holders from time to time of Purchase Warrant
Certificates. Nothing in this Agreement is intended or shall be construed to
confer upon any other person any right, remedy or claim or to impose on any
other person any duty, liability or obligation.
14. FURTHER INSTRUMENTS. The parties shall execute and deliver any
and all such other instruments and shall take any and all other actions as may
be reasonably necessary to carry out the intention of this Agreement.
15. SEVERABILITY. If any provision of this Agreement shall be held,
declared or pronounced void, voidable, invalid, unenforceable, or inoperative
for any reason by any court of competent jurisdiction, government authority or
otherwise, such holding, declaration or pronouncement shall not affect
adversely any other provision of this Agreement, which shall otherwise remain
in full force and effect and be enforced in accordance with its terms, and the
effect of such holding, declaration or pronouncement shall be limited to the
territory or jurisdiction in which made.
16. WAIVER. All the rights and remedies of either party under this
Agreement are cumulative and not exclusive of any other rights and remedies as
provided by law. No delay or failure on the part of either party in the
exercise of any right or remedy arising from a breach of this Agreement shall
operate as a waiver of any subsequent right or remedy arising from a
subsequent breach of this Agreement. The consent of any party where required
hereunder to act or occurrence shall not be deemed to be a consent to any
other action or occurrence.
17. GENERAL PROVISIONS. This Agreement shall be construed and
enforced in accordance with, and governed by, the laws of the State of
Colorado. Except as otherwise expressly stated herein, time is of the essence
in performing hereunder. This Agreement embodies the entire agreement and
understanding between the parties and supersedes all prior agreements and
understandings relating to the subject matter hereof, and this Agreement may
not be modified or amended or any term or provisions hereof waived or dis-
charged except in writing signed by the party against whom such amendment,
modification, waiver or discharge is sought to be enforced. The headings of
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this Agreement are for convenience in reference only and shall not limit or
otherwise affect the meaning hereof. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
METEOR INDUSTRIES, INC.
ATTEST:
By
---------------------------- ------------------------------------------
Xxxxxx X. Xxxxx, Secretary Xxxxxx X. Names, President
THE WARRANT AGENT:
AMERICAN SECURITIES TRANSFER & TRUST, INC.
By
------------------------------------------
Authorized Officer
Title:
--------------------------------------
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EXHIBIT A
METEOR INDUSTRIES, INC.
Incorporated Under the Laws of the State of Colorado
No. W- ----- Common Stock
Purchase Warrants
CUSIP -----------
CERTIFICATE FOR REDEEMABLE (See Reverse
COMMON STOCK PURCHASE WARRANTS For Certain
Definitions)
This Warrant Certificate certifies that -------------------, or regis-
tered assigns ("the Warrant Holder"), is the registered owner of the above
indicated number of Redeemable Common Stock Purchase Warrants (the "Warrants")
expiring on -------------, 1998 (the "Expiration Date"). Each Warrant
entitles the Warrant Holder to purchase one (1) share of common stock, $.001
par value ("Share") from Meteor Industries, Inc., a Colorado corporation (the
"Company"), at a purchase price of $---- (the "Exercise Price"), commencing on
----------, 1996, and terminating on the Expiration Date ("Exercise Period"),
upon surrender of this Warrant Certificate with the exercise form hereon duly
completed and executed with payment of the Exercise Price at the office of
American Securities Transfer & Trust, Inc. (the "Warrant Agent"), but only
subject to the conditions set forth herein and in a Warrant Agreement dated as
of -----------, 1996 (the "Warrant Agreement"), between the Company and the
Warrant Agent. The Exercise Price, the number of shares purchasable upon
exercise of each Warrant, the number of Warrants outstanding and the
Expiration Date are subject to adjustments upon the occurrence of certain
events. The Warrantholder may exercise all or any number of Warrants.
Reference hereby is made to the provisions on the reverse side of this Warrant
Certificate and to the provisions of the Warrant Agreement, all of which are
incorporated by reference in and made a part of this Warrant Certificate and
shall for all purposes have the same effect as though fully set forth at this
place.
Upon due presentment for transfer of this Warrant Certificate at the
office of the Warrant Agent, a new Warrant Certificate or Warrant Certificates
of like tenor and evidencing in the aggregate a like number of Warrants, sub-
ject to any adjustments made in accordance with the provisions of the Warrant
Agreement, shall be issued to the transferee in exchange for this Warrant
Certificate, subject to the limitations provided in the Warrant Agreement,
upon payment of $------ per Warrant Certificate and any tax or governmental
charge imposed in connection with such transfer.
The Warrantholder of the Warrants evidenced by this Warrant Certificate
may exercise all or any whole number of such Warrants during the period and in
the manner stated hereon. The Exercise Price shall be payable in lawful money
of the United States of America and in cash or by certified or bank cashier's
check or bank draft payable to the order of the Company. If upon exercise of
any Warrants evidenced by this Warrant Certificate the number of Warrants
exercised shall be less than the total number of Warrants so evidenced, there
shall be issued to the Warrantholder a new Warrant Certificate evidencing the
number of Warrants not so exercised.
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Subject to the following paragraph, no Warrant may be exercised after
5:00 p.m. Mountain Time on the Expiration Date and any Warrant not exercised
by such time shall become void, unless extended by the Company.
In the event that the trading price of the Company's Common Stock
exceeds $---- for 10 consecutive trading days ending not more than ten days
prior to the mailing of the notice of redemption, the Company shall have the
right to call all or a portion of the Warrants for redemption upon 30 days'
written notice, at a price of $.10 per Warrant. During the 30-day period
immediately following the giving of such notice, the Warrantholders shall have
the right to exercise the Warrants so held by them. Upon expiration of such
30-day period, all rights of the Warrantholders shall terminate, other than
the rights to receive the redemption price of $.10 per Warrant therefor,
without interest, and the right to receive the redemption price of $.10 per
Warrant shall itself expire on the Warrant Expiration Date.
This Warrant Certificate shall not be valid unless countersigned by the
Warrant Agent.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its President and by its Secretary, each by a facsimile of his/her signature,
and has caused a facsimile of its corporate seal to be imprinted hereon.
Dated:--------------
METEOR INDUSTRIES, INC.
By
---------------------------- ------------------------------------------
AMERICAN SECURITIES TRANSFER & TRUST, INC.,
Warrant Agent
By
------------------------------------------
Authorized Officer
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TRANSFER FEE $---- PER CERTIFICATE
METEOR INDUSTRIES, INC.
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT -
TEN ENT - as tenants by the entireties Custodian
JT TEN - as joint tenants with right (Cust) (Minor)
of survivorship and not as Under Uniform Gifts
tenants in common to Minors Act -------
(State)
Additional abbreviations may also be used though not in the above list.
FORM OF ASSIGNMENT
(To Be Executed by the Registered Holder if He
Desires to Assign Warrants Evidenced by the
Within Warrant Certificate)
FOR VALUE RECEIVED ----------------------- hereby sells, assigns and
transfers unto -------------------------- Redeemable Warrants, evidenced by
the within Warrant Certificate, and does hereby irrevocably constitute and
appoint ---------------------- Attorney to transfer the said Warrants
evidenced by the within Warrant Certificate on the books of the Company, with
full power of substitution.
Dated: ----------------- --------------------------------------
Signature
NOTICE: The above signature must correspond with the name as written upon the
face of the within Warrant Certificate in every particular, without alteration
or enlargement or any change whatsoever.
Signature Guaranteed:
-----------------------------
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FORM OF ELECTION TO PURCHASE
(To be Executed by the Holder if he Desires to Exercise
Warrants Evidenced by the Within Warrant Certificate)
To Meteor Industries, Inc.:
The undersigned hereby irrevocably elects to exercise ----------
Redeemable Warrants, evidenced by the within Warrant Certificate for, and to
purchase thereunder, ---------- full shares of Common Stock issuable upon
exercise of said Warrants and delivery of $-------- and any applicable taxes.
The undersigned requests that certificates for such shares be issued in
the name of:
PLEASE INSERT SOCIAL SECURITY OR
TAX IDENTIFICATION NUMBER
------------------------------------ ------------------------------------
(Please print name and address)
------------------------------------
------------------------------------
If said number of Redeemable Warrants shall not be all the Redeemable
Warrants evidenced by the within Warrant Certificate, the undersigned requests
that a new Warrant Certificate evidencing the Redeemable Warrants not so
exercised be issued in the name of and delivered to:
------------------------------------
(Please print name and address)
------------------------------------
------------------------------------
Dated:------------------- Signature:------------------------------
NOTICE: The above signature must correspond with the name as written upon the
face of the within Warrant Certificate in every particular, without alteration
or enlargement or any change whatsoever, or if signed by any other person the
Form of Assignment hereon must be duly executed and if the certificate
representing the shares or any Warrant Certificate representing Warrants not
exercised is to be registered in a name other than that in which the within
Warrant Certificate is registered, the signature of the holder hereof must be
guaranteed.
Signature Guaranteed:
-------------------------------
SIGNATURE MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS, AND CREDIT UNITS WITH MEMBERSHIP
IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO SEC RULE
17Ad-15.
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