EXHIBIT 4.12
WARRANT AGREEMENT
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 NOR REGISTERED OR QUALIFIED UNDER
THE SECURITIES OR BLUE SKY LAWS OF ANY STATE. NEITHER THIS WARRANT, NOR THE
SECURITIES ISSUABLE UPON EXERCISE HEREOF, NOR ANY INTEREST OR PARTICIPATION
THEREIN, MAY BE SOLD, ASSIGNED, PLEDGED, HYPOTHECATED, ENCUMBERED OR IN ANY
OTHER MANNER TRANSFERRED OR DISPOSED OF UNLESS (I) REGISTERED UNDER AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 AND IN FULL COMPLIANCE
WITH THE APPLICABLE RULES AND REGULATIONS THEREUNDER AND APPLICABLE STATE
SECURITIES OR BLUE SKY LAWS, (II) PURSUANT TO RULE 144 UNDER SUCH ACT OR (III)
UNLESS ELTRAX SYSTEMS, INC. RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF
SUCH SECURITIES, REASONABLY SATISFACTORY TO ELTRAX SYSTEMS, INC., STATING THAT
SUCH SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION, ENCUMBRANCE OR OTHER MANNER OF
TRANSFER OR DISPOSITION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY
REQUIREMENTS OF THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES OR
BLUE SKY LAW.
ELTRAX SYSTEMS, INC.
Warrant for the Purchase
of Shares of Common Stock
Warrant No. PNC-1
September 1, 2000 12,532 Shares
FOR VALUE RECEIVED, ELTRAX SYSTEMS, INC., a Minnesota
corporation (the "Company"), hereby certifies that PNC BANK, NATIONAL
ASSOCIATION (the "Holder"), is entitled, subject to the provisions of this
Warrant, to purchase from the Company, at any time or from time to time during
the Exercise Period (as hereinafter defined) 12,532 shares of the common stock
of the Company (the "Warrant Shares") at the applicable Exercise Price (as
hereinafter defined).
The number and character of shares of common stock of the
Company (the "Company Common Stock") to be received upon exercise of this
Warrant are subject to adjustment in accordance with the provisions of Sections
6 and 7 hereof.
For purposes of this Warrant, "Warrant Shares" means the
shares of the Company Common Stock deliverable upon exercise of this Warrant, as
adjusted from time to time. Unless the context requires otherwise, all
references to the Company Common Stock and Warrant Shares in this Warrant shall,
in the event of an adjustment pursuant to Sections 6 and 7 hereof, be deemed to
refer also to any securities or property then issuable upon exercise of this
Warrant as a result of such adjustment.
Section 1. Exercise of Warrant. This Warrant may be exercised,
in whole, at any time or from time to time during the Exercise Period or, if
such day is not a Business Day, then on the next succeeding Business Day, by
presentation and surrender hereof to the Company at the address set forth in
Section 15 hereof (or at such other address as the Company may hereafter notify
the Holder in writing), with the Purchase Form annexed hereto duly executed and
accompanied by proper payment of the aggregate applicable Exercise Price in
lawful money of the United States of America in the form of a
certified or cashier's check to the order of Eltrax Systems, Inc. or by wire
transfer of same day funds, for the number of Warrant Shares specified in such
form. Upon receipt by the Company of this Warrant and such Purchase Form,
together with the aggregate applicable Exercise Price (as hereinafter defined)
for the number of Warrant Shares specified in such Purchase Form, at such
office, the Company shall issue and deliver to the Holder, in the name of the
Holder, a certificate or certificates for the Warrant Shares. Such certificate
or certificates shall be deemed to have been issued and the Holder shall be
deemed to have become the holder of record of such Warrant Shares as of the date
of the surrender of this Warrant, notwithstanding that the stock transfer books
of the Company shall then be closed or that certificates representing such
Warrant Shares shall not then be actually delivered to the Holder. The Company
shall pay any and all documentary stamp or similar issue or transfer taxes
payable in respect of the issue or delivery of the Warrant Shares.
Section 2. Exercise Period and Exercise Price.
(a) This Warrant shall be exercisable during the period
(the "Exercise Period") beginning on the date of execution of this Warrant (the
"Initial Exercise Date") and ending at 5:00 p.m. (Atlanta, Georgia time) on the
fifth anniversary date of the Initial Exercise Date (the "Termination Date").
(b) "Exercise Price" means $.01 per share of the Company
Common Stock, subject to adjustment as herein provided.
Section 3. Reservation of Shares. The Company hereby agrees
that at all times there shall be reserved for issuance and delivery upon
exercise of this Warrant all shares of the Company Common Stock or other shares
of capital stock of the Company or other property from time to time issuable
upon exercise of this Warrant. All such shares shall be duly authorized and,
when issued upon such exercise in accordance with the terms of this Warrant,
shall be validly issued, fully paid and nonassessable, free and clear of all
liens, security interests, charges and other encumbrances or restrictions on
sale (other than any restrictions on sale pursuant to applicable federal and
state securities laws) and free and clear of all preemptive rights.
Section 4. Exchange, Transfer, Assignment or Loss of Warrant.
(a) This Warrant is exchangeable, without expense, at
the option of the Holder, upon presentation and surrender hereof to the Company
for other warrants of different denomination, entitling the Holder thereof to
purchase in the aggregate the same number of Warrant Shares and otherwise
carrying the same rights as this Warrant.
(b) This Warrant may be divided or combined by the
Holder with other warrants that carry the same rights upon presentation hereof
at the office of the Company, together with a written notice specifying the
names and denominations in which new warrants are to be issued and signed by the
Holder hereof. The term "Warrant" as used herein includes any warrants into
which this Warrant may be divided or for which it may be exchanged.
(c) Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant, and (in the case of loss, theft or destruction) of reasonably
satisfactory indemnification, and upon surrender and cancellation of this
Warrant, if mutilated, the Company shall execute and deliver a new Warrant of
like tenor and date.
Section 5. Rights of the Holder. The Holder shall not, by
virtue hereof, be entitled to any rights of a stockholder in the Company, either
at law or in equity, and the rights of the Holder are limited to those expressed
in this Warrant.
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Section 6. Antidilution Provisions and Other Adjustments. The
number of Warrant Shares which may be purchased upon the exercise hereof shall
be subject to change or adjustment from time to time as follows:
(a) Stock Dividends; Stock Splits; Reverse Stock
Splits; Reclassifications. In case the Company shall (i) pay a dividend or make
any other distribution with respect to the Company Common Stock in shares of its
capital stock, (ii) subdivide its outstanding Company Common Stock, (iii)
combine its outstanding Company Common Stock into a smaller number of shares, or
(iv) issue any shares of its capital stock in a reclassification of the Company
Common Stock (including any such reclassification in connection with a merger
(other than the transactions contemplated by the Merger Agreement),
consolidation or other business combination in which the Company is the
continuing corporation) the number of shares of Company Common Stock issuable
upon exercise of this Warrant immediately prior to the record date for each such
dividend or distribution or the effective date of each such subdivision or
combination shall be adjusted so that the Holder shall thereafter be entitled
after the completion of each such event to receive the kind and number of shares
of Company Common Stock or other securities of the Company that the Holder would
have owned or have been entitled to receive after the happening of each such
event, had this Warrant been exercised immediately prior to the happening of
each such event or any record date with respect thereto. Each adjustment made
pursuant to this Section 6(a) shall become effective immediately after the
effective date of the applicable event retroactive to the record date, if any,
for such event.
(b) Distributions of Debt, Assets, Subscription Rights
or Convertible Securities. In case the Company shall fix a record date for the
making of a distribution to all holders of shares of the Company Common Stock of
evidences of indebtedness of the Company, assets (other than cash dividends
payable out of retained earnings or securities (excluding those referred to in
Section 6(a)) (any such evidences of indebtedness, assets, or securities being
referred to in this Section 6(b) as the "assets or securities"), then in each
case the Holder, upon the exercise of this Warrant, shall be entitled to receive
in addition to the shares of Company Common Stock issuable upon exercise of this
Warrant, (i) the assets or securities to which the Holder would have been
entitled as a holder of Company Common Stock if the Holder had exercised this
Warrant immediately prior to the record date for such distribution and (ii) any
interest or distributions on the assets or securities distributed from the
distribution date to the date of exercise. At the time of any such distribution,
the Company shall either (A) deposit the assets or securities payable to the
Holder pursuant hereto in trust for the Holder with an eligible institution (as
hereinafter defined) with instructions as to the investment of such property and
any proceeds therefrom so as to protect the value of such property for the
Holder or (B) distribute to the Holder the assets or securities to which it
would be entitled upon exercise and, upon any such distribution pursuant to this
clause (B), the provisions of this Section 6(b) shall no longer apply to such
event. Such election shall be made by the Company by giving written notice
thereof to the Holder.
For purposes of this Section 6(b), the term "eligible
institution" shall mean a corporation organized and doing business under the
laws of the United States of America or of any state thereof, authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least $100,000,000, and subject to supervision or examination by
Federal or state authority.
(c) De Minimis Adjustments. Except as provided in
Section 6(d) with reference to adjustments required by such Section 6(d), no
adjustment in the number of shares of Company Common Stock issuable hereunder
shall be required unless such adjustment would require an increase or decrease
of at least one percent (1%) in the number of shares of Company Common Stock
issuable upon the exercise of this Warrant; provided, however, that any
adjustments which by reason of this Section 6(c) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations shall be made to the nearest one-thousandth of a share.
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(d) Adjustments. In case the Company after the date
hereof shall take any action affecting the Warrant Shares, other than any action
described in Sections 6(a) or 6(b) or in Section 7 hereof, which the Company's
board of directors, acting in the good faith exercise of their reasonable
judgment, determines would have a material adverse effect on the rights of the
Holder, then the Exercise Price, the number of Warrant Shares and/or the
character of the securities receivable upon exercise of this Warrant may be
adjusted in such manner, if any, and at such time, by action of the directors,
acting in the good faith exercise of their reasonable judgment, subject to
obtaining all necessary approvals to such adjustment, including, without
limitation, any necessary approvals of any stock exchange or over-the-counter
market on which securities of the Company are then listed or quoted.
(e) Notice of Adjustment. Whenever the number of
shares of Company Common Stock or other stock or property issuable upon the
exercise of this Warrant is adjusted, as herein provided, the Company shall
promptly notify the Holder of such adjustment or adjustments.
(f) Adjustments to Exercise Price. The aggregate
exercise price payable upon exercise of this Warrant shall not increase or
decrease upon any adjustment (pursuant to this Section 6) to the number of
Warrant Shares issuable upon exercise of this Warrant. Accordingly, the per
share Exercise Price of the Warrant Shares will be adjusted to reflect any such
adjustment to the number of Warrant Shares issuable as required not to increase
or decrease the aggregate exercise price payable upon exercise of this Warrant.
Section 7. Reclassification. Reorganization, Consolidation or
Merger. In the event of any reclassification, capital reorganization or other
change of outstanding shares of the Company Common Stock (other than a
subdivision or combination of the outstanding Company Common Stock, a change in
the par value of the Company Common Stock or a transaction subject to Section 6
hereof) or in the event of any consolidation or merger of the Company with or
into another corporation (other than the transactions contemplated by the Merger
Agreement, a merger in which merger the Company is the continuing corporation
and that does not result in any reclassification, capital reorganization or
other change of outstanding shares of Company Common Stock of the class issuable
upon exercise of this Warrant or a transaction subject to Section 6 hereof) or
in the event of any sale, lease, transfer or conveyance to another corporation
of the property and assets of the Company as an entirety or substantially as an
entirety, in each case as a result of which the holders of Company Common Stock
shall be entitled to receive stock, securities or other property or assets
(including cash) with respect to or in exchange for such Company Common Stock,
then the Company shall, as a condition precedent to such transaction, cause
effective provisions to be made so that such other corporation shall assume all
of the obligations of the Company hereunder and 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 (including cash) receivable
upon such reclassification, capital reorganization and other change,
consolidation, merger, sale, lease, transfer or conveyance by a holder of the
number of shares of Company Common Stock that might have been received upon
exercise of this Warrant immediately prior to such reclassification, capital
reorganization, change, consolidation, merger, sale, lease or conveyance. Any
such provision shall include provision for adjustments in respect of such shares
of stock and other securities and property that shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Warrant. The
foregoing provisions of this Section 7 shall similarly apply to successive
reclassifications, capital reorganizations and changes of shares of Company
Common Stock and to successive changes, consolidations, mergers, sales, leases,
transfers or conveyances of the nature and type described in the first sentence
hereof. In the event that in connection with any such capital reorganization,
reclassification, consolidation, merger, sale, lease, transfer or conveyance,
additional shares of Company Common Stock shall be issued in exchange,
conversion, substitution or payment, as a whole or in part,
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for, or of, a security of the Company other than Company Common Stock, any such
issue shall be treated as an issue of Company Common Stock covered by the
provisions of Section 6(a).
Section 8. Transfer to Comply with the Securities Act. Neither
this Warrant, nor any of the Warrant Shares, nor any interest therein, may be
sold, assigned, pledged, hypothecated, encumbered or in any other manner
transferred or disposed of, as a whole or in part, except in compliance with
applicable United States federal and state securities or Blue Sky laws and the
terms and conditions hereof. Each Warrant shall bear a legend in substantially
the same form as the legend set forth on the first page of this initial Warrant.
Each certificate for Warrant Shares issued upon exercise of this Warrant, unless
at the time of exercise such exercise is registered under the Securities Act of
1933, as amended (the "Securities Act"), shall bear a legend substantially in
the following form:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933 or registered or qualified
under the securities or Blue Sky laws of any state. Neither these
securities nor any interest or participation therein may be sold,
assigned, pledged, hypothecated, encumbered or in any other manner
transferred or disposed of unless (i) registered under an effective
registration statement under the Securities Act of 1933 and in full
compliance with the applicable rules and regulations thereunder and
applicable state securities or Blue Sky laws, (ii) pursuant to Rule 144
of such Act or (iii) unless Eltrax Systems, Inc. receives an opinion of
counsel for the holder of this certificate, reasonably satisfactory to
Eltrax Systems, Inc., stating that such sale, assignment, pledge,
hypothecation, encumbrance or other manner of transfer or disposition
is exempt from the registration and prospectus delivery requirements of
the Securities Act of 1933 and applicable state securities or Blue Sky
law."
Any certificate for any Warrant Shares issued at any time in exchange or
substitution for any certificate for any Warrant Shares bearing such legend
(except a new certificate for any Warrant Shares issued after registration of
such Warrant Shares under the Securities Act) shall also bear such legend
unless, in the opinion of counsel for the Company, the Warrant Shares
represented thereby need no longer be subject to the restriction contained
herein. The provisions of this Section 8 shall be binding upon all subsequent
holders of certificates for Warrant Shares bearing the above legend and all
subsequent Holders of this Warrant, if any. Warrant Shares sold pursuant to a
Registration Statement under the Securities Act pursuant to Section 12 thereof
or sold by the holder thereof in compliance with Rule 144 under the Securities
Act shall thereafter cease to be deemed to be "Warrant Shares" for all purposes
of this Warrant.
Section 9. Listing on Securities Exchanges. On or before the
Initial Exercise Date, the Company shall list on each national securities
exchange on which any Company Common Stock may at such time be listed (if
required by such exchange), subject to official notice of issuance upon the
exercise of this Warrant, all shares of Company Common Stock from time to time
issuable upon exercise of this Warrant and the Company shall maintain, so long
as any other shares of the Company Common Stock shall be so listed, all shares
of Company Common Stock from time to time issuable upon the exercise of this
Warrant; and the Company shall so list on each national securities exchange, and
shall maintain such listing of, any other shares of capital stock of the Company
issuable upon the exercise of this Warrant if and so long as any shares of
capital stock of the same class shall be listed on such national securities
exchange by the Company. Any such listing shall be at the Company's expense.
Section 10. Availability of information. The Company shall
comply with the reporting requirements of Sections 13 and 15(d) of the Exchange
Act to the extent it is required to do so under the Exchange Act, and shall
likewise comply with all other applicable public information reporting
requirements of the Securities and Exchange Commission (including those required
to make available the benefits of Rule 144 under the Securities Act) to which it
may from time to time be subject. The Company shall also cooperate with the
holder of this Warrant and the holder of any Warrant Shares in supplying
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such information as may be necessary for such holder to complete and file any
information reporting forms currently or hereafter required by the Commission as
a condition to the availability of Rule 144 or any successor rule under the
Securities Act for the sale of this Warrant or the Warrant Shares. The
provisions of this Section 10 shall survive termination of this Warrant, whether
upon exercise of this Warrant in full or otherwise until such time as the
Warrant Shares have been sold by the Holder or are eligible for sale under Rule
144(k). The Company shall also provide to holders of this Warrant the same
information that it provides to holders of the Company Common Stock.
Section 11. Registration Rights. The Company agrees to include
the Warrant Shares on the registration statement it files with the Securities
and Exchange Commission pursuant to that certain Registration Rights Agreement
dated July 27, 2000 by and among the Company and Bay Harbor Investments, Inc.
and Strong River Investments, Inc., as the same may be amended from time to time
(the "Registration Rights Agreement"). Holder agrees to comply with and be bound
by the terms of the Registration Rights Agreement as if it were a party thereto,
except that it shall not be entitled to the benefits of Section 2(c) thereof.
Section 12. Successors and Assigns. All the provisions of this
Warrant by or for the benefit of the Company or the Holder shall bind and inure
to the benefit of their respective successors and assigns.
Section 13. Headings. The headings of sections of this Warrant
have been inserted for convenience of reference only, are not to be considered a
part hereof and shall in no way modify or restrict any of the terms or
provisions hereof.
Section 14. Amendments. This Warrant may not be amended except
by the written consent of the Company and the Holder.
Section 15. Notices. All notices, requests and other
communications required or permitted under this Agreement (collectively,
"notices") shall be in writing and sent or delivered in one of the manners
expressly contemplated in this Section 15. If mailed, notices must be sent by
prepaid first-class mail, certified, return receipt requested, and shall be
deemed to have been received on the earlier of the date shown on the receipt or
three (3) Business Days after the post-xxxx date thereof. In addition, notices
hereunder may be delivered by hand in which event the notice shall be deemed
effective when delivered or by a nationally recognized overnight courier, in
which event the notice shall be deemed delivered the first Business Day after it
is accepted by the courier for next day delivery. All such notices shall be
given to the parties hereto at the following addresses:
(a) If to the Company:
Eltrax Systems, Inc.
000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
Telecopier No.: (000) 000-0000
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with a required copy to:
Jaffe, Raitt, Heuer & Xxxxx, Professional Corporation
Xxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Telecopier No.: (000) 000-0000
(b) If to the Holder:
PNC Bank, National Association
Xxx Xxxxx Xxxxxx Xxxxxxxxx
Xxxx Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxx Xxxxxxx
Telecopier No.: (000) 000-0000
with a required copy to:
Parker, Hudson, Rainer & Xxxxx LLP
1500 Marquis Two Tower
000 Xxxxxxxxx Xxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Telecopier No.: 404-522-8409
Attention: Xxxx X. Xxxxxxx, Esq.
Any party hereto may change the address to which notices shall
be directed under this Section by giving written notice of such change to the
other parties.
Section 16. Governing Law. This Warrant shall be governed by
the internal laws of the State of Georgia, without regard to the conflict of law
provisions thereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Warrant Agreement to be executed and delivered by its duly authorized officer as
of September 1, 2000.
ELTRAX SYSTEMS, INC.
/s/ Xxxxxx X. Xxxx
-----------------------------------------
By: Name: Xxxxxx X. Xxxx
Title: Chief Executive Officer
Acknowledgment and Agreement
By signing below, the Holder of this Warrant does hereby acknowledge
receipt hereof and does hereby agree to be bound by the terms and conditions
hereof.
PNC BANK, NATIONAL ASSOCIATION
By:
--------------------------------------
Name:
Title:
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PURCHASE FORM
To: Eltrax Systems, Inc.
The undersigned irrevocably exercises the Warrant for the
purchase of ______________ shares (subject to adjustment) of the common stock,
par value $.01 per share, of Eltrax Systems, Inc., for the Warrant and herewith
makes payment of $_____________ (the "Exercise Price") through the following
method:
[ ] such payment of the Exercise Price being in cash or by certified or
official bank check payable to the order of Eltrax Systems, Inc.; or
[ ] such payment of the Exercise Price being made by wire transfer of
same day funds to Eltrax Systems, Inc. to the account specified
below and delivered thereto.
all at the Exercise Price and on the terms and conditions specified in the
within the Warrant therein referred to, surrenders the Warrant and all right,
title and interest therein to Eltrax Systems, Inc. and directs (subject to
Section 8 of the Warrant) that the shares of Company Common Stock deliverable
upon the exercise of such Warrant be registered or placed in the name and at the
address specified below and delivered thereto.
The undersigned hereby certifies to Eltrax Systems, Inc. that
it is, at the time of exercise of the Warrant, an "accredited investor" as
defined in Rule 501(a) of the Securities Act of 1933, as amended.
Date:__________________________________, 20__
---------------------------------------
(Signature of Owner)(1)
---------------------------------------
(Street Address)
---------------------------------------
(City) (State) (Zip Code)
Securities and/or check to be issued to:
Please insert social security or identifying number:
Name:
--------
(1) The signature must correspond with the name as written upon the face of the
within Warrant in every particular, without alteration or enlargement or
any change whatever.
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Street Address:
City, State and Zip Code:
Any unexercised part of the Warrant evidenced by the within Warrant to be issued
to:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
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FORM OF ASSIGNMENT
FOR VALUE RECEIVED the undersigned registered holder of the
within Warrant hereby sells, assigns, and transfers unto the Assignee(s) named
below (including the undersigned with respect to any part of the Warrant not
being assigned hereby) all of the right of the undersigned under the within
Warrant, with respect to the number of shares of Company Common Stock set forth
below:
Name of Assignee Address of Assignee Social Security or Other Number of Shares of
Identifying Number of Company Common Stock
Assignee Assigned to Assignee
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and does hereby irrevocably constitute and appoint
______________________________________ as the undersigned's attorney to make
such transfer on the books of ________________________________ (Eltrax Systems,
Inc. or other such party) maintained for that purpose, with full power of
substitution in the premises.
Date:_______________________________________, 20___
-----------------------------------------------
(Signature of Owner)1
-----------------------------------------------
(Street Address)
-----------------------------------------------
(City) (State) (Zip Code)
(1) The signature must correspond with the name as written upon the face of
the within Warrant in every particular, without alteration or
enlargement or any change whatever.
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