Exhibit 4.03
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES LAWS OR THE SECURITIES LAWS OF ANY OTHER
JURISDICTION, AND MAY NOT BE OFFERED OR SOLD IN CONTRAVENTION OF SECTION 5 OF
SUCH ACT OR THE LAWS OF ANY APPLICABLE JURISDICTION.
Warrant to Purchase
Common Stock
of
International Discount Telecommunications, Corp.,
a New York corporation
International Discount Telecommunications, Corp., a New York
corporation ("IDT") certifies that XXXX X. XXXXXXX ("Xxxxxxx") is the owner
of a Warrant which shall automatically be exercised upon the earliest to occur
of the three events set forth below (each a "Triggering Event") into shares
(the "Shares") of IDT common stock, no par value, representing
three-and-one-eighth (3 1/8) percent of the issued and outstanding common
stock of IDT as of January 2, 1996. The Triggering Events are as follows:
(i) the time immediately prior to the reincorporation merger of IDT into IDT
Corporation, a Delaware corporation and wholly-owned subsidiary of IDT, (ii)
immediately prior to the consummation of an inital public offering by IDT of
its common stock for aggregate proceeds of at least $15 million (an "IPO"),
and (iii) March 31, 1996. The exercise price of this Warrant is $1.00,
payment of which has been made previously to IDT. The number of shares due to
Xxxxxxx shall be computed on a fully diluted basis, after giving effect to
the issuance of stock to Xxxxxxx. In the event of a reincorporation merger,
18.4 million shares of IDT Corporation will be outstanding on a fully diluted
basis, including the Shares, and this Warrant shall carry the right to
acquire 575,000 shares of Common Stock of IDT Corporation for the exercise
price stated above. Xxxxxxx shall have the right to review IDT's stock
ledgers and stock transfer books to confirm that the correct number of shares
has been issued to him. IDT shall provide Xxxxxxx with notice of the
occurrence of a Triggering Event and, upon exercise of the Warrant by virtue
of the occurrence of such Triggering Event, shall deliver to Xxxxxxx
certificates representing the Shares.
IDT shall file with the Securities and Exchange Commission ("SEC")
on a date 180 days following the consummation of the IPO, a
shelf-registration statement ("Shelf Registration Statement") covering the
Shares, and to use its best efforts to have the Shelf Registration Statement
be declared effective by the SEC as soon thereafter as practicable. The
registration of the Shares shall comply with applicable securities laws,
including Blue Sky laws. IDT shall maintain the effectiveness of the Shelf
Registration Statement until the earlier of (i) all the Shares having been
sold
and (ii) January 2, 1998 plus a period equal to any Suspension Period (as
defined below); provided that IDT may delay or suspend the effectiveness of
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the Shelf Registration Statement or, without suspending such effectiveness,
instruct Xxxxxxx not to sell any Shares included in the Shelf Registration
Statement, if IDT shall have determined upon advice of counsel that it
would be required to disclose any actions taken or proposed to be taken by
IDT in good faith and for valid business reasons, including without
limitation, the acquisition or divestiture of assets, which disclosure would
have a material effect on IDT or on such actions (a "Suspension Period") by
providing written notice to Xxxxxxx. The Suspension Period shall not exceed
ninety (90) days in any one hundred eighty (180) day period during which the
Shelf Registration Statement would otherwise be effective. IDT shall bear
the cost of preparation of the Shelf Registration Statement but shall not be
responsible for underwriting commissions, transfer taxes or legal fees of
Xxxxxxx.
The Shares shall be entitled to the benefit of piggyback
registration rights no less favorable than those held by any stockholder of
IDT on the date of this Warrant.
Dated as of January 2, 1996
INTERNATIONAL DISCOUNT
TELECOMMUNICATIONS, CORP.
By:
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Name: Xxxxxx X. Xxxxx
Title: President and Chief
Executive Officer