EXHIBIT 10.3
THIS WARRANT AND THE SHARES OF WARRANT STOCK ISSUABLE UPON EXERCISE OF THIS
WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR ANY STATE SECURITIES LAWS. THIS WARRANT AND THE WARRANT STOCK ISSUABLE UPON
EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS
WARRANT UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO XXXXXXX.XXX, INC. THAT SUCH REGISTRATION IS
NOT REQUIRED.
Right to Purchase Shares of Warrant Stock
(as defined herein) of Xxxxxxx.xxx, Inc.
STOCK PURCHASE WARRANT
No. ___ Issue Date: December 20, 2005
XXXXXXX.XXX, INC., a corporation organized under the laws of
the State of Delaware, hereby certifies that, for value received,
_______________, or assigns (the "Holder"), is entitled, subject to the terms
set forth below, to purchase from the Company (as defined herein) from and after
the date hereof and at any time or from time to time before 5:00 p.m., New York
time, through the close of business (New York time) on September 21, 2010 (the
"Expiration Date"), the Warrant Stock (as hereinafter defined and subject to
adjustment as provided herein), in whole or in part, at a purchase price per
share equal to the Exercise Price (as hereinafter defined and subject to
adjustment as provided herein).
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
(a) The term "Automatic Conversion Date" means the time at which the
shares of Preferred Stock are automatically converted into Common Stock pursuant
to the Certificate of Designation.
(b) The term "Certificate of Designation" means the Designations of
Rights and Preferences of Series B Convertible Preferred Stock of the Company.
(c) The term "Common Exercise Price" means, in respect of a share of
Common Stock at any date herein specified, from and after the Automatic
Conversion Date, the price at which a share of Common Stock may be purchased
pursuant to this Warrant on such date. Unless and until the Common Exercise
Price is adjusted pursuant to the terms herein, the initial
Common Exercise Price per share of Common Stock shall be an amount equal to (x)
the Preferred Exercise Price immediately prior to the Automatic Conversion Date
divided by (y) the Conversion Ratio as of the Automatic Conversion Date.
(d) The term "Conversion Ratio" shall have the meaning assigned to such
term in the Certificate of Designation.
(e) The term "Company" shall include Xxxxxxx.xxx, Inc. and any
corporation which shall succeed, or assume the obligations of, Xxxxxxx.xxx, Inc.
hereunder.
(f) The term "Common Stock" includes (i) the Company's Common Stock,
par value $0.001 per share, and (ii) any other securities into which or for
which any of the securities described in clause (i) may be converted or
exchanged pursuant to a plan of recapitalization, reorganization, merger, sale
of assets or otherwise.
(g) The term "Other Securities" refers to any stock (other than Warrant
Stock) and other securities of the Company or any other person (corporate or
otherwise) which the holder of the Warrant at any time shall be entitled to
receive, or shall have received, on the exercise of the Warrant, in lieu of or
in addition to Warrant Stock, or which at any time shall be issuable or shall
have been issued in exchange for or in replacement of Warrant Stock or Other
Securities pursuant to Section 4 or otherwise.
(h) The term "Exercise Price" means, in respect of a share of Warrant
Stock at any date herein specified, the price at which a share of Warrant Stock
may be purchased pursuant to this Warrant on such date. The Exercise Price shall
be equal to the Preferred Exercise Price at any time prior to the Automatic
Conversion Date and Common Exercise Price from and after the Automatic
Conversion Date.
(i) The term "Preferred Exercise Price" means, in respect of a share of
Preferred Stock at any date herein specified, prior to the Automatic Conversion
Date, the price at which a share of Preferred Stock may be purchased pursuant to
this Warrant on such date. Unless and until the Preferred Exercise Price is
adjusted pursuant to the terms herein, the initial Preferred Exercise Price
shall be $2,112.54 per share of Preferred Stock.
(j) The term "Preferred Stock" means the Series B Convertible Preferred
Stock of the Company, par value $0.001 per share.
(k) The term "Warrant Common Stock" means a number of shares of Common
Stock to be purchased upon the exercise hereof from and after the Automatic
Conversion Date, subject to adjustment as provided herein, initially equal to
(x) the number of shares of Warrant Preferred Stock issuable upon exercise
hereof immediately prior to the Automatic Conversion Date multiplied by (y) the
Conversion Ratio as of the Automatic Conversion Date.
(l) The term "Warrant Preferred Stock" means, the [TO BE INSERTED]
shares of Preferred Stock to be purchased upon the exercise hereof prior to the
Automatic Conversion Date, subject to adjustment as provided herein.
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(m) The term "Warrant Stock" means, prior to the Automatic Conversion
Date, the shares of Warrant Preferred Stock to be purchased upon the exercise
hereof and, from and after the Automatic Conversion Date, the shares of Warrant
Common Stock to be purchased upon the exercise hereof.
1. Exercise of Warrant.
1.1 Exercise Notice. From and after the date hereof through
and including the Expiration Date, the Holder shall be entitled exercise this
Warrant, by delivery of an original or fax copy of an exercise notice in the
form attached hereto as Exhibit A (the "Exercise Notice"), for all or any part
of the number of shares of Warrant Stock purchasable hereunder.
1.2 Conversion to Common Stock Purchase Warrant. This Warrant
shall initially be exercisable for the purchase of the Warrant Preferred Stock.
Upon the Automatic Conversion Date, this Warrant shall no longer be exercisable
for the Warrant Preferred Stock, but shall be exercisable for the Warrant Common
Stock.
1.3 Company Acknowledgment. The Company will, at the time of
the exercise of the Warrant, upon the request of the Holder hereof acknowledge
in writing its continuing obligation to afford to such Holder any rights to
which such Holder shall continue to be entitled after such exercise in
accordance with the provisions of this Warrant. If the Holder shall fail to make
any such request, such failure shall not affect the continuing obligation of the
Company to afford to such Holder any such rights.
2. Procedure for Exercise.
2.1 Delivery of Stock Certificates, etc. on Exercise. The
Company agrees that the shares of Warrant Stock purchased upon exercise of this
Warrant shall be deemed to be issued to the Holder as the record owner of such
shares as of the close of business on the date on which this Warrant shall have
been surrendered and payment made for such shares in accordance herewith. As
soon as practicable after the exercise of this Warrant in full or in part, and
in any event within three (3) business days thereafter, the Company at its
expense (including the payment by it of any applicable issue taxes) will cause
to be issued in the name of and delivered to the Holder, or as such Holder (upon
payment by such Holder of any applicable transfer taxes) may direct in
compliance with applicable securities laws, a certificate or certificates for
the number of duly and validly issued, fully paid and nonassessable shares of
Warrant Stock (or Other Securities) to which such Holder shall be entitled on
such exercise.
2.2 Exercise. Payment shall be made in cash or by certified or
official bank check payable to the order of the Company equal to the applicable
aggregate Exercise Price, for the number of shares of Warrant Stock specified in
such Exercise Notice (as such exercise number shall be adjusted to reflect any
adjustment in the total number of shares of Warrant Stock issuable to the Holder
per the terms of this Warrant) and the Holder shall thereupon be entitled to
receive the number of duly authorized, validly issued, fully-paid and
non-assessable shares of Warrant Stock (or Other Securities) determined as
provided herein.
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3. Effect of Reorganization, etc.; Adjustment of Exercise Price.
3.1 Reorganization, Consolidation, Merger, etc. In case that
at any time or from time to time, the Company shall (a) effect a capital
reorganization, recapitalization, subdivision or reclassification of Common
Stock from and after the Automatic Conversion Date, or Preferred Stock prior to
the Automatic Conversion Date (in each case other than a subdivision or
combination of the outstanding Common Stock or Preferred Stock, or a change in
par value, or from par value to no par value or from no par value to par value),
(b) effect an exchange or conversion of the Common Stock or Preferred Stock for
or into securities of another corporation or other entity, (c) effect a
consolidation or merger of the Company with or into any other person (other than
a merger that does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock or Preferred Stock), (d)
effect a sale, lease or other conveyance of all or substantially all of the
assets of the Company, in any such case in a way that upon such transaction
holders of Common Stock or Preferred Stock would be entitled to receive stock,
securities, cash and/or other property with respect to or in exchange for their
shares of Common Stock or Preferred Stock, then, in each such case: (x) as a
condition to the consummation of such a transaction, provision shall be made by
the Company whereby the Holder of this Warrant, on the exercise hereof as
provided in Section 1 at any time after the consummation of such transaction,
shall receive, in lieu of the Warrant Stock (or Other Securities) issuable
hereunder, the stock and/or other securities and property (including cash) to
which such Holder would have been entitled upon such transaction ("Transaction
Consideration"), if such Holder had so exercised this Warrant, immediately prior
thereto, all subject to further adjustment thereafter as provided in Sections 4
and 5, and (y) from and after the closing of such transaction, the holder of
this Warrant shall only have the right to receive the Transaction Consideration
upon exercise of this Warrant in accordance with its terms.
3.2 Dissolution. In the event of any dissolution of the
Company following the transfer of all or substantially all of its properties or
assets, the Company, concurrently with any distributions made to holders of its
Common Stock (or prior to the Automatic Conversion Date, its Preferred Stock),
shall at its expense deliver or cause to be delivered to the Holder the stock
and other securities and property (including cash, where applicable) receivable
by the Holder of the Warrant pursuant to Section 3.1.
3.3 Continuation of Terms. Upon any reorganization,
consolidation, merger or transfer (and any dissolution following any transfer)
referred to in this Section 3, this Warrant shall continue in full force and
effect and the terms hereof shall be applicable to the shares of stock and other
securities and property receivable on the exercise of this Warrant after the
consummation of such reorganization, consolidation or merger or the effective
date of dissolution following any such transfer, as the case may be, and shall
be binding upon the issuer of any such stock or other securities, including, in
the case of any such transfer, the person acquiring all or substantially all of
the properties or assets of the Company, whether or not such person shall have
expressly assumed the terms of this Warrant. In the event this Warrant does not
continue in full force and effect after the consummation of the transactions
described in this Section 3, then the Company's securities and property
(including cash, where applicable) receivable by the Holders of the Warrant will
be delivered to Holder.
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4. Extraordinary Events Regarding Preferred Stock or Common Stock.
4.1 Preferred Stock Events. If the Company shall at any time
prior to the Automatic Conversion Date while this Warrant is outstanding, (a)
issue additional shares of the Preferred Stock as a dividend or other
distribution on outstanding Preferred Stock, (b) subdivide its outstanding
shares of Preferred Stock, or (c) combine its outstanding shares of the
Preferred Stock into a smaller number of shares of the Preferred Stock, then in
each such case, the Preferred Exercise Price shall, simultaneously with the
happening of such event, be adjusted by multiplying the then effective Preferred
Exercise Price by a fraction, the numerator of which shall be the number of
shares of Preferred Stock outstanding immediately prior to such event and the
denominator of which shall be the number of shares of Preferred Stock
outstanding immediately after such event, and the product so obtained shall
thereafter be the Preferred Exercise Price then in effect. The Preferred
Exercise Price, as so adjusted, shall be readjusted in the same manner upon the
happening of any successive event or events described herein in this Section
4.1. In the event that the Preferred Exercise Price is adjusted pursuant to
either Section 4 or 5, the number of shares of Warrant Preferred Stock issuable
upon exercise of this Warrant shall be increased or decreased to a number
determined by multiplying the number of shares of Warrant Preferred Stock that
would otherwise (but for the provisions of Section 4 or 5, as applicable) be
issuable on such exercise by a fraction of which (a) the numerator is the
Preferred Exercise Price that would otherwise (but for the provisions of Section
4 or 5, as applicable) be in effect, and (b) the denominator is the Preferred
Exercise Price as so adjusted pursuant to Section 4 or 5. This Section 4.1 in
its entirety shall apply only prior to the Automatic Conversion Date and shall
have no force or effect from and after the Automatic Conversion Date at which
time Section 4.2 shall apply.
4.2 Common Stock Events. If the Company shall at any time from
and after the Automatic Conversion Date while this Warrant is outstanding, (a)
issue additional shares of the Common Stock as a dividend or other distribution
on outstanding Common Stock, (b) subdivide its outstanding shares of Common
Stock, or (c) combine its outstanding shares of the Common Stock into a smaller
number of shares of the Common Stock, then in each such case, the Common
Exercise Price shall, simultaneously with the happening of such event, be
adjusted by multiplying the then effective Common Exercise Price by a fraction,
the numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such event and the denominator of which shall be the number
of shares of Common Stock outstanding immediately after such event, and the
product so obtained shall thereafter be the Common Exercise Price then in
effect. The Common Exercise Price, as so adjusted, shall be readjusted in the
same manner upon the happening of any successive event or events described
herein in this Section 4. In the event that the Common Exercise Price is
adjusted pursuant to either Section 4 or 5, the current number of shares of
Warrant Common Stock issuable upon exercise of this Warrant shall be increased
or decreased to a number determined by multiplying the number of shares of
Warrant Common Stock that would otherwise (but for the provisions of Section 4
or 5, as applicable) be issuable on such exercise by a fraction of which (a) the
numerator is the Common Exercise Price that would otherwise (but for the
provisions of Section 4 or 5, as applicable) be in effect, and (b) the
denominator is the Common Exercise Price as so adjusted pursuant to Section 4 or
5. This Section 4.2 in its entirety shall apply only from and after the
Automatic Conversion Date and shall have no force or effect prior to the
Automatic Conversion Date.
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4.3 Reference Price Adjustments. If the Company shall at any
time while this Warrant is outstanding, (a) issue additional shares of the
Common Stock as a dividend or other distribution on outstanding Common Stock,
(b) subdivide its outstanding shares of Common Stock, or (c) combine its
outstanding shares of the Common Stock into a smaller number of shares of the
Common Stock, then in each such case, the Reference Price (as hereinafter
defined) shall, simultaneously with the happening of such event, be adjusted by
multiplying the then effective Reference Price by a fraction, the numerator of
which shall be the number of shares of Common Stock outstanding immediately
prior to such event and the denominator of which shall be the number of shares
of Common Stock outstanding immediately after such event, and the product so
obtained shall thereafter be the Reference Price then in effect. The Reference
Price, as so adjusted, shall be readjusted in the same manner upon the happening
of any successive event or events described herein in this Section 4. This
Section 4.3 shall apply both prior to and from and after the Automatic
Conversion Date.
5. Dilutive Issuances.
5.1 Issuances Below the Trigger Price Prior to Automatic
Conversion Date. If the Company shall prior to the Automatic Conversion Date at
any time while this Warrant is outstanding, offer, sell, grant any option to
purchase or offer, sell or grant any right to reprice its securities, or
otherwise dispose of or issue (or announce any offer, sale, grant or any option
to purchase or other disposition) any Common Stock or any security convertible
or exercisable into Common Stock ("Common Stock Equivalents") entitling any
person to acquire shares of Common Stock, at an effective price per share of
less than the lesser of (x) $.191662 per share (as such amount may be adjusted
from time to time as contemplated herein, the "Reference Price") and (y) the
then effective Common Exercise Price (such lesser amount, as adjusted from time
to time as contemplated herein, the "Trigger Price") (if the holder of the
Common Stock or Common Stock Equivalents so issued shall at any time, whether by
operation of purchase price adjustments, reset provisions, floating conversion,
exercise or exchange prices or otherwise, or due to warrants, options or rights
per share which is issued in connection with such issuance, be entitled to
receive shares of Common Stock at an effective price per share which is less
than the Trigger Price, such issuance shall be deemed to have occurred for less
than the Trigger Price), then the Preferred Exercise Price shall be reduced to a
price determined by dividing (i) an amount equal to the sum of (a) the total
number of shares of Common Stock outstanding immediately prior to such issuance
or sale, plus (b) the number of shares of Common Stock which the consideration,
if any, received by the Company upon such issuance or sale would purchase at the
Common Exercise Price by (ii) the total number of shares of Common Stock
outstanding immediately after such issuance or sale, and multiplying the Common
Exercise Price by such quotient and thereafter multiplying the product so
obtained by the Conversion Ratio, provided, that for purposes hereof, all shares
of Common Stock that are issuable upon conversion, exercise or exchange of
Common Stock Equivalents shall be deemed outstanding immediately after the
issuance of such Common Stock Equivalents. Such adjustment shall be made
whenever such shares of Common Stock or Common Stock Equivalents are issued.
This Section 5.1 in its entirety shall apply only prior to the Automatic
Conversion Date and shall have no force or effect from and after the Automatic
Conversion Date at which time Section 5.2 shall apply.
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5.2 Issuances Below the Trigger Price From and After Automatic
Conversion Date. If the Company shall at any time from and after the Automatic
Conversion Date while this Warrant is outstanding offer, sell, grant any option
to purchase or offer, sell or grant any right to reprice its securities, or
otherwise dispose of or issue (or announce any offer, sale, grant or any option
to purchase or other disposition) any Common Stock Equivalents entitling any
person to acquire shares of Common Stock, at an effective price per share of
less than the Trigger Price, then the Common Exercise Price shall be reduced to
a price determined by dividing (i) an amount equal to the sum of (a) the total
number of shares of Common Stock outstanding immediately prior to such issuance
or sale, plus (b) the number of shares of Common Stock which the consideration,
if any, received by the Company upon such issuance or sale would purchase at the
Common Exercise Price by (ii) the total number of shares of Common Stock
outstanding immediately after such issuance or sale, and multiplying the Common
Exercise Price by such quotient, provided, that for purposes hereof, all shares
of Common Stock that are issuable upon conversion, exercise or exchange of
Common Stock Equivalents shall be deemed outstanding immediately after the
issuance of such Common Stock Equivalents. Such adjustment shall be made
whenever such shares of Common Stock or Common Stock Equivalents are issued.
This Section 5.2 in its entirety shall apply only from and after the Automatic
Conversion Date and shall have no force or effect prior to the Automatic
Conversion Date.
5.3 Deemed Issuances. The issuance of any security exercisable
or exchangeable for, or convertible into, Common Stock shall be deemed to be the
issuance of the number of shares of Common Stock initially issuable upon the
exercise, exchange or conversion thereof. If any security exercisable or
exchangeable for, or convertible into, Common Stock by its terms provides for
subsequent increases or decreases in the number of shares of Common stock
issuable upon exercise, exchange or conversion thereof, upon any such increase
or decrease, the Exercise Price shall be appropriately readjusted.
5.4 Issuance Price. The price per share of any security
exercisable or exchangeable for, or convertible into, Common Stock shall be
deemed equal to the quotient obtained by dividing (i) the sum of the purchase
price for such security plus any additional consideration payable upon the
exercise, exchange or conversion thereof into Common Stock by (ii) the number of
shares of Common Stock initially issuable upon exercise, exchange or conversion
thereof. If any security exercisable or exchangeable for, or convertible into,
Common Stock by its terms provides for subsequent increases or decreases in the
additional consideration payable upon exercise, exchange or conversion thereof
into Common Stock, upon any such increase or decrease, the Exercise Price shall
be appropriately readjusted.
5.5 Time of Adjustment. Except as otherwise provided herein,
the determination of whether any adjustment, if any, is required by reason of
the issuance of any shares of Common Stock upon exercise, exchange or conversion
of securities shall be made only at the time of the issuance of such securities
and not at the subsequent time of issuance of shares of Common Stock upon
exercise, exchange or conversion thereof.
5.6 Subsequent Adjustments. If the right to acquire shares of
Common Stock upon exercise, exchange or conversion of any security that shall
have given rise to an adjustment shall expire or terminate prior to the
exercise, exchange or conversion thereof, then
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the Exercise Price and the number of shares of Warrant Preferred Stock or
Warrant Common Stock, as the case may be, issuable upon exercise of this Warrant
shall be readjusted to eliminate any shares of Common Stock issuable upon
exercise, exchange or conversion of the security that shall have so expired or
terminated. If there shall be an increase or decrease or increases or decreases,
with the passage of time or otherwise, in the price payable upon the exercise,
exchange or conversion of any security, then the Exercise Price and number of
shares of Warrant Preferred Stock or Warrant Common Stock, as the case may be,
issuable upon exercise of this Warrant shall be adjusted to give effect to the
additional or lesser consideration received or receivable therefor.
5.7 Valuation of Consideration. The consideration per share
for the issuance or sale of any shares of Common Stock (or any securities
exercisable or exchangeable for, or convertible into, Common Stock) shall,
irrespective of the accounting treatment of such consideration:
(a) insofar as such consideration consists of cash, equal the amount of
cash received by the Company;
(b) insofar as such consideration consists of property (including
securities) other than cash, equal to the fair market value thereof at the time
of such issuance or sale; and
(c) in case shares of Common Stock (or any securities exercisable or
exchangeable for, convertible into, Common Stock) are issued or sold by the
Company together with other stock or securities or other assets of the Company
for consideration that covers both, equal to the portion of such consideration
so received, computed as provided in the preceding clauses (a) and (b) above,
allocable to such shares of Common Stock (or any such other securities);
all as determined by the Board of Directors of the Company.
5.8 Excepted Issuances. No adjustment shall be made to the
Exercise Price and/or the number of shares of Warrant Preferred Stock or Warrant
Common Stock, as the case may be, issuable upon exercise of this Warrant
pursuant to this Section 5 in connection with the following:
(a) the issuance of options to purchase up to 23,478,820 shares of
Common Stock of the Company to employees, consultants, officers or directors of
the Company pursuant to any stock option, stock purchase or stock bonus plan,
agreement or arrangement, which issuance has been approved by the compensation
committee of the Board;
(b) issuances in connection with the acquisition by the Company of a
business entity or segment of any such entity by merger, purchase of stock or
assets or otherwise;
(c) issuances in connection with any direct or indirect borrowings by
the Company, including any type of loan or payment evidenced by any type of debt
instrument;
(d) issuances in a public offering;
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(e) issuances of any shares of Series B Preferred Stock, Series C
Preferred Stock, or warrants pursuant to that certain Share Exchange Agreement
dated as of December 20, 2005 by and among the Company, Advanced Aesthetics,
Inc. and certain securityholders of Advanced Aesthetics, Inc.;
(f) issuances upon exercise, exchange or conversion of any convertible
securities of the Company outstanding as of the date hereof;
(g) issuances with respect to which the holders of a majority of the
shares of Series C Preferred Stock outstanding at the time of such issuance
shall have waived their rights to receive any such adjustment; or
(h) issuances upon exercise, exchange or conversion of any security
referred to in the preceding clauses (a) through (g).
6. Certificate as to Adjustments. In each case of any adjustment or
readjustment in the shares of Warrant Stock (or Other Securities) issuable on
the exercise of the Warrant, the Company at its expense will promptly cause its
Chief Financial Officer or other appropriate designee to compute such adjustment
or readjustment in accordance with the terms of the Warrant and prepare a
certificate setting forth such adjustment or readjustment and showing in detail
the facts upon which such adjustment or readjustment is based. The Company will
forthwith mail a copy of each such certificate to the Holder of the Warrant and
any Warrant agent of the Company (appointed pursuant to Section 10 hereof).
7. Reservation of Stock, etc. Issuable on Exercise of Warrant. The
Company will at all times reserve and keep available, solely for issuance and
delivery on the exercise of the Warrant, shares of Warrant Stock (or Other
Securities) from time to time issuable on the exercise of the Warrant.
8. Right to Call Warrant. In the event that the Common Stock (or the
equity securities into which the Company's Common Stock shall have been
exchanged or converted into in accordance with this Warrant) trades on an
exchange or market (i) at a price of no less than $0.53 per share (as such
shares of Common Stock are presently constituted) for 20 days in any 30
consecutive trading days and (ii) not less than an average of 880,456 shares
each day over such trading period, then, the Company shall have the right to
redeem this Warrant for $.00085 per share on 10 days written notice to the
holder hereof. For the purposes of clarification, such stock shall be deemed to
trade on an exchange or market at a price of no less than $0.53 per share (as
such shares are presently constituted) if the average closing bid price for 20
days on the principal stock exchange (including Nasdaq) on which such common
stock is then listed or admitted or trading or quoted as applicable is $0.53 or
more or if no sale takes place on any day on any such exchange, utilizing the
last reported closing bid price on such day as officially quoted on such
exchange (including Nasdaq) or if the common stock is not then listed or traded
on any stock exchange, utilizing the last reported closing bid price on such day
in the over-the-counter market, as furnished by the National Association of
Securities Dealers Automatic Quotation System or the National Quotation Bureau
Inc. and if neither such corporation at the time is engaged in the business of
reporting such prices as furnished by any similar firm then engaged in such
business. Promptly following receipt of the notice referred to above, the holder
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of this Warrant shall deliver its Warrant to the Company or if such Warrant has
been lost or stolen an affidavit and indemnification agreement in form and
substance satisfactory to the Company and if the Company so requests, evidence
that such holder shall have posted a bond satisfactory to the Company. As soon
as practicable thereafter the Company shall issue payment for the Warrant as
aforesaid. From and after the date that is 10 days after the notice described
above is sent by the Company, this Warrant shall no longer be deemed to be
outstanding or be transferable and shall have no rights of any kind other than
to receive payment as provided above.
9. Assignment; Exchange of Warrant. Subject to compliance with
applicable securities laws, this Warrant, and the rights evidenced hereby, may
be transferred by any registered holder hereof (a "Transferor") in whole or in
part. On the surrender for exchange of this Warrant, with the Transferor's
endorsement in the form of Exhibit B attached hereto (the "Transferor
Endorsement Form") and together with evidence reasonably satisfactory to the
Company demonstrating compliance with applicable securities laws, which shall
include, without limitation, a legal opinion from the Transferor's counsel that
such transfer is exempt from the registration requirements of applicable
securities laws, the Company at its expense but with payment by the Transferor
of any applicable transfer taxes) will issue and deliver to or on the order of
the Transferor thereof a new Warrant of like tenor, in the name of the
Transferor and/or the transferee(s) specified in such Transferor Endorsement
Form (each a "Transferee"), calling in the aggregate on the face or faces
thereof for the number of shares of Warrant Stock called for on the face or
faces of the Warrant so surrendered by the Transferor.
10. Replacement of Warrant. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of this Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.
11. Warrant Agent. The Company may, by written notice to the Holder of
the Warrant, appoint an agent for the purpose of issuing Warrant Stock (or Other
Securities) on the exercise of this Warrant pursuant to Section 1, exchanging
this Warrant pursuant to Section 9, and replacing this Warrant pursuant to
Section 10, or any of the foregoing, and thereafter any such issuance, exchange
or replacement, as the case may be, shall be made at such office by such agent.
12. Transfer on the Company's Books. Until this Warrant is transferred
on the books of the Company, the Company may treat the registered holder hereof
as the absolute owner hereof for all purposes, notwithstanding any notice to the
contrary.
13. Notices, etc. All notices and other communications from the Company
to the Holder of this Warrant shall be mailed by first class registered or
certified mail, postage prepaid, at such address as may have been furnished to
the Company in writing by such Holder or, until any such Holder furnishes to the
Company an address, then to, and at the address of, the last Holder of this
Warrant who has so furnished an address to the Company.
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14. Miscellaneous. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. This Warrant shall be governed by and construed in accordance with
the laws of State of Delaware without regard to principles of conflicts of laws.
In the event that any provision of this Warrant is invalid or unenforceable
under any applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any such provision which
may prove invalid or unenforceable under any law shall not affect the validity
or enforceability of any other provision of this Warrant. The headings in this
Warrant are for purposes of reference only, and shall not limit or otherwise
affect any of the terms hereof. The invalidity or unenforceability of any
provision hereof shall in no way affect the validity or enforceability of any
other provision.
[Signature page to follow]
11
IN WITNESS WHEREOF, the Company has executed this Warrant as of the
date first written above.
The Company: XXXXXXX.XXX, INC.
By: ______________________________
Name: Xxxx Xxxxxxx
Title: Chief Executive Officer
The Holder:
------------------------------
By:___________________________________
12
EXHIBIT A
FORM OF SUBSCRIPTION
(To be signed only on exercise of Warrant)
TO: Xxxxxxx.xxx, Inc.
Attention: Chief Financial Officer
The undersigned, pursuant to the provisions set forth in the attached Warrant
(No.____), hereby irrevocably elects to purchase (check applicable box):
___ ________ shares of the [Common Stock][Preferred Stock] covered by such
Warrant.
The undersigned herewith makes payment of the full Exercise Price for such
shares at the price per share provided for in such Warrant, which is
$___________. Such payment takes the form of:
___ $__________ in lawful money of the United States.
The undersigned requests that the certificates for such shares be issued in the
name of, and delivered to ____________________ whose address is
______________________________
---------------------------------------------------------------------------.
The undersigned represents and warrants that all offers and sales by the
undersigned of the securities issuable upon exercise of the within Warrant shall
be made pursuant to registration of the [Common Stock][Preferred Stock] under
the Securities Act of 1933, as amended (the "Securities Act") or pursuant to an
exemption from registration under the Securities Act.
Dated:___________________ _______________________________________
(Signature must conform to name of holder as
specified on the face of the Warrant)
--------------------------------------------
(Address)
EXHIBIT B
FORM OF TRANSFEROR ENDORSEMENT
(To be signed only on transfer of Warrant)
For value received, the undersigned hereby sells, assigns, and
transfers unto the person(s) named below under the heading "Transferees" the
right represented by the within Warrant to purchase the percentage and number of
shares of Warrant Stock of Xxxxxxx.xxx, Inc. which the within Warrant relates
specified under the headings "Percentage Transferred" and "Number Transferred,"
respectively, opposite the name(s) of such person(s) and appoints each such
person Attorney to transfer its respective right on the books of Xxxxxxx.xxx,
Inc. with full power of substitution in the premises.
------------------------------- ---------------------------- ---------------------------- ----------------------------
Transferees Address Percentage Transferred Number Transferred
------------------------------- ---------------------------- ---------------------------- ----------------------------
------------------------------- ---------------------------- ---------------------------- ----------------------------
------------------------------- ---------------------------- ---------------------------- ----------------------------
------------------------------- ---------------------------- ---------------------------- ----------------------------
------------------------------- ---------------------------- ---------------------------- ----------------------------
Dated:___________________
------------------------------------------------
(Signature must conform to name of holder as
specified on the face of the Warrant)
Signed in the presence of:
--------------------------- ------------------------------------------------
(Name) (address)
ACCEPTED AND AGREED:
------------------------------------------------
[TRANSFEREE] (address)
---------------------------
(Name)
