EXHIBIT 4.4.5
THE REGISTERED HOLDER OF THIS UNIT PURCHASE OPTION BY ITS ACCEPTANCE HEREOF,
AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS UNIT PURCHASE OPTION
EXCEPT AS HEREIN PROVIDED AND THE REGISTERED HOLDER OF THIS UNIT PURCHASE OPTION
AGREES THAT IT WILL NOT SELL, TRANSFER, ASSIGN, PLEDGE OR HYPOTHECATE THIS UNIT
PURCHASE OPTION FOR A PERIOD OF ONE HUNDRED EIGHTY (180) DAYS FOLLOWING THE
EFFECTIVE DATE (DEFINED BELOW) TO ANYONE OTHER THAN (I) NEWBRIDGE SECURITIES
CORPORATION ("NEWBRIDGE") I-BANKERS SECURITIES INCORPORATED ("I-BANKERS"), OR AN
UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA
FIDE OFFICER OR PARTNER OF NEWBRIDGE OR I-BANKERS OR OF ANY SUCH UNDERWRITER OR
SELECTED DEALER.
THIS UNIT PURCHASE OPTION IS NOT EXERCISABLE PRIOR TO THE LATER OF THE
CONSUMMATION BY SAND HILL IT SECURITY ACQUISITION CORP. (THE "COMPANY") OF A
MERGER, CAPITAL STOCK EXCHANGE, ASSET ACQUISITION OR OTHER SIMILAR BUSINESS
COMBINATION (THE "BUSINESS COMBINATION") (AS DESCRIBED MORE FULLY IN THE
COMPANY'S REGISTRATION STATEMENT (DEFINED HEREIN)) OR JULY 25, 2005. VOID AFTER
5:00 P.M. EASTERN TIME, JULY 25 2009.
No. UPO-6
UNIT PURCHASE OPTION
FOR THE PURCHASE OF
115,463 UNITS
OF
SAND HILL IT SECURITY ACQUISITION CORP.
1. Unit Purchase Option.
THIS CERTIFIES THAT, in consideration of $100 duly paid by or on behalf of
I-Bankers Securities Incorporated, (a "Holder"), as registered owner of this
Unit Purchase Option, to Sand Hill IT Security Acquisition Corp. (the
"Company"), Holder is entitled, at any time or from time to time upon the later
of the consummation of a Business Combination or July 25, 2005 (the
"Commencement Date"), and at or before 5:00 p.m., Eastern Time, July 25, 2009
(the "Expiration Date"), but not thereafter, to subscribe for, purchase and
receive, in whole or in part, up to One Hundred Fifteen Thousand Four Hundred
Sixty Three (115,463) units (the "Units") of the Company, each Unit consisting
of one share of common stock of the Company, par value $0.01 per share (the
"Common Stock"), and two warrants (the "Warrant(s)") expiring five years from
the effective date (the "Effective Date") of the registration statement (the
"Registration Statement") pursuant to which Units are offered for sale to the
public (the "Offering"). Each Warrant is the same as the warrants included in
the Units being registered for sale to the public (the "Public Warrants") under
the Securities Act of 1933, as amended (the "Act") except that the exercise
price of the Warrants shall be $6.65 per share. If the Expiration Date is a day
on which banking institutions are authorized by law to close, then this Unit
Purchase Option may be exercised on the next succeeding day which is not such a
day in accordance with the terms herein. During the period ending on the
Expiration Date, the Company agrees not to take any action that would terminate
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the Unit Purchase Option. This Unit Purchase Option is initially exercisable at
$7.50 per Unit so purchased; provided, however, that upon the occurrence of any
of the events specified in Section 6 hereof, the rights granted by this Unit
Purchase Option, including the exercise price per Unit and the number of Units
(and shares of Common Stock and Warrants) to be received upon such exercise,
shall be adjusted as therein specified. The term "Exercise Price" shall mean the
initial exercise price or the adjusted exercise price, depending on the context.
2. Exercise.
(a) Exercise Procedure. In order to exercise this Unit Purchase
Option, the exercise form attached hereto must be duly executed and completed
and delivered to the Company, together with this Unit Purchase Option and
payment of the Exercise Price for the Units being purchased payable in cash or
by certified check or official bank check. If the subscription rights
represented hereby shall not be exercised at or before 5:00 p.m., Eastern time,
on the Expiration Date this Unit Purchase Option shall become and be void
without further force or effect, and all rights represented hereby shall cease
and expire.
(b) Legend. Each certificate for the securities purchased under this
Unit Purchase Option shall bear a legend as follows unless such securities have
been registered under the Securities Act of 1933, as amended (the "Act"):
"The securities represented by this certificate have not
been registered under the Securities Act of 1933, as amended
(the "Act") or applicable state law. The securities may not
be offered for sale, sold or otherwise transferred except
pursuant to an effective registration statement under the
Act, or pursuant to an exemption from registration under the
Act and applicable state law."
(c) Cashless Exercise. (i) In lieu of the payment of the Exercise
Price multiplied by the number of Units for which this Unit Purchase Option is
exercisable (and in lieu of being entitled to receive Common Stock and Warrants)
in the manner required by Section 2.(a), the Holder shall have the right (but
not the obligation) to convert any exercisable but unexercised portion of this
Unit Purchase Option into Units (the "Conversion Right") as follows: upon
exercise of the Conversion Right, the Company shall deliver to the Holder
(without payment by the Holder of any of the Exercise Price in cash) that number
of shares of Common Stock and Warrants comprising that number of Units equal to
the quotient obtained by dividing (x) the "Value" (as defined below) of the
portion of the Unit Purchase Option being converted by (y) the Current Market
Value (as defined below). The "Value" of the portion of the Unit Purchase Option
being converted shall equal the remainder derived from subtracting (a) (i) the
Exercise Price multiplied by (ii) the number of Units underlying the portion of
this Unit Purchase Option being converted from (b) the Current Market Value of a
Unit multiplied by the number of Units underlying the portion of the Unit
Purchase Option being converted. As used herein, the term "Current Market Value"
per Unit at any date means the remainder derived from subtracting (x) the
exercise price of the Warrants multiplied by the number of shares of Common
Stock issuable upon exercise of the Warrants underlying one Unit from (y) the
Current Market Price of the Common Stock multiplied by the number of shares of
Common Stock underlying the Warrants and the Common Stock issuable upon exercise
of one Unit. The "Current Market Price" of a share of Common Stock shall mean
(i) if the Common Stock is listed on a national securities exchange or quoted on
the Nasdaq National Market, Nasdaq SmallCap Market or NASD OTC Bulletin Board
(or successor such as the Bulletin Board Exchange), the last sale price of the
Common Stock in the principal trading market for the Common Stock as reported by
the exchange, Nasdaq or the NASD, as the case may be; (ii) if the Common Stock
is not listed on a national securities exchange or quoted on the Nasdaq National
Market, Nasdaq SmallCap Market or the NASD OTC Bulletin Board (or successor such
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as the Bulletin Board Exchange), but is traded in the residual over-the-counter
market, the closing bid price for the Common Stock on the last trading day
preceding the date in question for which such quotations are reported by the
Pink Sheets, LLC or similar publisher of such quotations; and (iii) if the fair
market value of the Common Stock cannot be determined pursuant to clause (i) or
(ii) above, such price as the Board of Directors of the Company shall determine,
in good faith.
(ii) The Cashless Exercise Right may be exercised by the Holder
on any business day on or after the Commencement Date and not later than the
Expiration Date by delivering the Unit Purchase Option with the duly executed
exercise form attached hereto with the cashless exercise section completed to
the Company, exercising the Cashless Exercise Right and specifying the total
number of Units the Holder will purchase pursuant to such Cashless Exercise
Right.
3. Transfer.
(a) Restrictions--General. The registered Holder of this Unit Purchase
Option, by its acceptance hereof, agrees that it will not sell, transfer,
assign, pledge or hypothecate this Unit Purchase Option for a period of one
hundred eighty (180) days following the Effective Date to anyone other than (i)
Newbridge or I-Bankers or an underwriter or a selected dealer in connection with
the Offering, or (ii) a bona fide officer or partner of Newbridge or I-Bankers
or of any such underwriter or selected dealer. On and after the first
anniversary of the Effective Date, transfers to others may be made subject to
compliance with or exemptions from applicable securities laws. In order to make
any permitted assignment, the Holder must deliver to the Company the assignment
form attached hereto duly executed and completed, together with the Unit
Purchase Option and payment of all transfer taxes, if any, payable in connection
therewith. The Company shall within five business days transfer this Unit
Purchase Option on the books of the Company and shall execute and deliver a new
Unit Purchase Option or Unit Purchase Options of like tenor to the appropriate
assignee(s) expressly evidencing the right to purchase the aggregate number of
Units purchasable hereunder or such portion of such number as shall be
contemplated by any such assignment.
(b) Restrictions--Securities. The securities evidenced by this Unit
Purchase Option shall not be transferred unless and until (i) the Company has
received the opinion of counsel for the Holder that the securities may be
transferred pursuant to an exemption from registration under the Act and
applicable state securities laws, the availability of which is established to
the reasonable satisfaction of the Company (the Company hereby agreeing that the
opinion of Xxxxxxx & Xxxxxxxxx shall be deemed satisfactory evidence of the
availability of an exemption), or (ii) a registration statement or a
post-effective amendment to the Registration Statement relating to such
securities has been filed by the Company and declared effective by the
Securities and Exchange Commission (the "Commission") and compliance with
applicable state securities law has been established.
4. New Purchase Options to be Issued.
(a) Partial Exercise. Subject to the restrictions in Section 3 hereof,
this Unit Purchase Option may be exercised or assigned in whole or in part. In
the event of the exercise or assignment hereof in part only, upon surrender of
this Unit Purchase Option for cancellation, together with the duly executed
exercise or assignment form and funds sufficient to pay any Exercise Price
and/or transfer tax, the Company shall cause to be delivered to the Holder
without charge a new Unit Purchase Option of like tenor to this Unit Purchase
Option in the name of the Holder evidencing the right of the Holder to purchase
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the number of Units purchasable hereunder as to which this Unit Purchase Option
has not been exercised or assigned.
(b) Loss, Theft, Destruction. Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, destruction or mutilation of this Unit
Purchase Option and of reasonably satisfactory indemnification or the posting of
a bond, the Company shall execute and deliver a new Unit Purchase Option of like
tenor and date. Any such new Unit Purchase Option executed and delivered as a
result of such loss, theft, mutilation or destruction shall constitute a
substitute contractual obligation on the part of the Company.
5. Registration Rights.
(a) Demand Registration.
(i) The Company, upon written demand (the "Initial Demand
Notice") of the Holder(s) of at least 51% of the Unit Purchase Options and/or
the underlying Units and/or the underlying securities (the "Majority Holders"),
agrees to register on one occasion, all or any portion of the Unit Purchase
Options requested by the Majority Holders in the Initial Demand Notice and all
of the securities underlying such Unit Purchase Options, including the Units,
Common Stock, the Warrants and the Common Stock underlying the Warrants
(collectively, the "Registrable Securities"). On such occasion, the Company will
file a registration statement or a post-effective amendment to the Registration
Statement covering the Registrable Securities within sixty days after receipt of
the Initial Demand Notice and use its best efforts to have such registration
statement or post-effective amendment declared effective as soon as possible
thereafter. The demand for registration may be made at any time during a period
of five years beginning on the Effective Date. The Company covenants and agrees
to give written notice of its receipt of any Initial Demand Notice by any
Holder(s) to all other registered Holders of the Unit Purchase Options and/or
the Registrable Securities within ten days from the date of the receipt of any
such Initial Demand Notice.
(ii) The Company shall bear all fees and expenses attendant to
registering the Registrable Securities, including the expenses of any legal
counsel selected by the Holders to represent them in connection with the sale of
the Registrable Securities, but the Holders shall pay any and all underwriting
commissions. The Company agrees to use its reasonable best efforts to qualify or
register the Registrable Securities in such states as are reasonably requested
by the Majority Holder(s); provided, however, that in no event shall the Company
be required to register the Registrable Securities in a state in which such
registration would cause (i) the Company to be obligated to qualify to do
business in such state, or would subject the Company to taxation as a foreign
corporation doing business in such jurisdiction or (ii) the principal
stockholders of the Company to be obligated to escrow their shares of capital
stock of the Company. The Company shall cause any registration statement or
post-effective amendment filed pursuant to the demand rights granted under
Section 5.1.1 to remain effective for a period of nine consecutive months from
the effective date of such registration statement or post-effective amendment.
(b) "Piggy-Back" Registration.
(i) In addition to the demand right of registration, the Holders
of the Unit Purchase Options shall have the right for a period of seven years
commencing on the Effective Date, to include the Registrable Securities as part
of any other registration of securities filed by the Company (other than in
connection with a transaction contemplated by Rule 145(a) promulgated under the
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Act or pursuant to Form S-8); provided, however, that if, in the written opinion
of the Company's managing underwriter or underwriters, if any, for such
offering, the inclusion of the Registrable Securities, when added to the
securities being registered by the Company or the selling stockholder(s), will
exceed the maximum amount of the Company's securities which can be marketed (i)
at a price reasonably related to their then current market value, and (ii)
without materially and adversely affecting the entire offering, then the Company
will still be required to include the Registrable Securities, but may require
the Holders to agree, in writing, to delay the sale of all or any portion of the
Registrable Securities for a period of 90 days from the effective date of the
offering, provided, further, that if the sale of any Registrable Securities is
so delayed, then the number of securities to be sold by all stockholders in such
public offering during such 90 day period shall be apportioned pro rata among
all such selling stockholders, including all holders of the Registrable
Securities, according to the total amount of securities of the Company owned by
said selling stockholders, including all holders of the Registrable Securities.
(ii) The Company shall bear all fees and expenses attendant to
registering the Registrable Securities, including the expenses of any legal
counsel selected by the Holders to represent them in connection with the sale of
the Registrable Securities but the Holders shall pay any and all underwriting
commissions related to the Registrable Securities. In the event of such a
proposed registration, the Company shall furnish the then Holders of outstanding
Registrable Securities with not less than fifteen days written notice prior to
the proposed date of filing of such registration statement. Such notice to the
Holders shall continue to be given for each applicable registration statement
filed (during the period in which the Unit Purchase Option is exercisable) by
the Company until such time as all of the Registrable Securities have been
registered and sold. The holders of the Registrable Securities shall exercise
the "piggy-back" rights provided for herein by giving written notice, within ten
days of the receipt of the Company's notice of its intention to file a
registration statement. The Company shall cause any registration statement filed
pursuant to the above "piggyback" rights to remain effective for at least nine
months from the date that the Holders of the Registrable Securities are first
given the opportunity to sell all of such securities.
(c) Damages. Should the registration or the effectiveness thereof
required by Sections 5(a) and 5(b) hereof be delayed by the Company or the
Company otherwise fails to comply with such provisions, the Company shall, in
addition to any other equitable or other relief available to the Holder(s), be
liable for any and all incidental, special and consequential damages sustained
by the Holder(s), including, but not limited to, the loss of any profits that
might have been received by the Holder upon the sale of shares of Common Stock
or Warrants (and shares of Common Stock underlying the Warrants) underlying this
Unit Purchase Option.
(d) Indemnification.
(i) The Company shall indemnify the Holder(s) of the Registrable
Securities to be sold pursuant to any registration statement hereunder and each
person, if any, who controls such Holders within the meaning of Section 15 of
the Act or Section 20(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), against all loss, claim, damage, expense or liability
(including all reasonable attorneys' fees and other expenses reasonably incurred
in investigating, preparing or defending against litigation, commenced or
threatened, or any claim whatsoever whether arising out of any action between
the Underwriter and the Company or between the Underwriter and any third party
or otherwise) to which any of them may become subject under the Act, the
Exchange Act or otherwise, arising from such registration statement but only to
the same extent and with the same effect as the provisions pursuant to which the
Company has agreed to indemnify the Underwriters contained in Section 5 of the
Underwriting Agreement between the Company, Newbridge and I-Bankers and the
other Underwriters named therein dated the Effective Date. The Holder(s) of the
Registrable Securities to be sold pursuant to such registration statement, and
their successors and assigns, shall severally, and not jointly, indemnify the
Company, its officers and directors and each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20(a) of the
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Exchange Act, against all loss, claim, damage, expense or liability (including
all reasonable attorneys' fees and other expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
they may become subject under the Act, the Exchange Act or otherwise, arising
from information furnished by or on behalf of such Holders, or their successors
or assigns, in writing, for specific inclusion in such registration statement to
the same extent and with the same effect as the provisions contained in Section
5 of the Underwriting Agreement pursuant to which the Underwriters have agreed
to indemnify the Company.
(ii) Nothing contained in this Unit Purchase Option shall be
construed as requiring the Holder(s) to exercise their Unit Purchase Options or
Warrants underlying such Unit Purchase Options prior to or after the initial
filing of any registration statement or the effectiveness thereof.
(iii) The Company shall furnish Newbridge and I-Bankers, as
representatives of the Holders participating in any of the foregoing offerings,
a signed counterpart, addressed to the participating Holders, of (i) an opinion
of counsel to the Company, dated the effective date of such registration
statement (and, if such registration includes an underwritten public offering,
an opinion dated the date of the closing under any underwriting agreement
related thereto), and (ii) a "cold comfort" letter dated the effective date of
such registration statement (and, if such registration includes an underwritten
public offering, a letter dated the date of the closing under the underwriting
agreement) signed by the independent public accountants who have issued a report
on the Company's financial statements included in such registration statement,
in each case covering substantially the same matters with respect to such
registration statement (and the prospectus included therein) and, in the case of
such accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to underwriters in underwritten public
offerings of securities. The Company shall also deliver promptly to Newbridge
and I-Bankers, as representatives of the Holders participating in the offering,
the correspondence and memoranda described below and copies of all
correspondence between the Commission and the Company, its counsel or auditors
and all memoranda relating to discussions with the Commission or its staff with
respect to the registration statement and permit Newbridge and I-Bankers, as
representatives of the Holders, to do such investigation, upon reasonable
advance notice, with respect to information contained in or omitted from the
registration statement as it deems reasonably necessary to comply with
applicable securities laws or rules of the National Association of Securities
Dealers, Inc. (the "NASD"). Such investigation shall include access to books,
records and properties and opportunities to discuss the business of the Company
with its officers and independent auditors, all to such reasonable extent and at
such reasonable times and as often as Newbridge and I-Bankers, as
representatives of the Holders, shall reasonably request. The Company shall not
be required to disclose any confidential information or other records to
Newbridge and I-Bankers, as representatives of the Holders, or to any other
person, until and unless such persons shall have entered into reasonable
confidentiality agreements (in form and substance reasonably satisfactory to the
Company), with the Company with respect thereto.
(iv) The Company shall enter into an underwriting agreement with
the managing underwriter(s), if any, selected by any Holders whose Registrable
Securities are being registered pursuant to this Section 5, which managing
underwriter shall be reasonably acceptable to the Company. Such agreement shall
be reasonably satisfactory in form and substance to the Company, each Holder and
such managing underwriters, and shall contain such representations, warranties
and covenants by the Company and such other terms as are customarily contained
6
in agreements of that type used by the managing underwriter. The Holders shall
be parties to any underwriting agreement relating to an underwritten sale of
their Registrable Securities and may, at their option, require that any or all
the representations, warranties and covenants of the Company to or for the
benefit of such underwriters shall also be made to and for the benefit of such
Holders. Such Holders shall not be required to make any representations or
warranties to or agreements with the Company or the underwriters except as they
may relate to such Holders and their intended methods of distribution. Such
Holders, however, shall agree to such covenants and indemnification and
contribution obligations for selling stockholders as are customarily contained
in agreements of that type used by the managing underwriter. Further, such
Holders shall execute appropriate custody agreements and otherwise cooperate
fully in the preparation of the registration statement and other documents
relating to any offering in which they include securities pursuant to this
Section 5. Each Holder shall also furnish to the Company such information
regarding itself, the Registrable Securities held by it, and the intended method
of disposition of such securities as shall be reasonably required to effect the
registration of the Registrable Securities.
(v) Notwithstanding anything contained in this Section 5 to the
contrary, the Company shall have no obligation pursuant to Sections 5(a) or 5(b)
for the registration of Registrable Securities held by any Holder (i) where such
Holder would then be entitled to sell under Rule 144 within any three-month
period (or such other period prescribed under Rule 144 as may be provided by
amendment thereof) all of the Registrable Securities then held by such Holder,
and (ii) where the number of Registrable Securities held by such Holder is
within the volume limitations under paragraph (e) of Rule 144 (calculated as if
such Holder were an affiliate within the meaning of Rule 144).
(vi) Each Holder agrees, that upon receipt of any notice from the
Company of the happening of any event as a result of which the prospectus
included in the Registration Statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing, such Holder will immediately
discontinue disposition of Registrable Securities pursuant to the Registration
Statement covering such Registrable Securities until such Xxxxxx's receipt of
the copies of a supplemental or amended prospectus, and, if so desired by the
Company, such Holder shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of such
destruction) all copies, other than permanent file copies then in such Holder's
possession, of the prospectus covering such Registrable Securities current at
the time of receipt of such notice.
6. Adjustments.
(a) Exercise Price and Number of Securities. The Exercise Price and
the number of Units underlying the Unit Purchase Option shall be subject to
adjustment from time to time as hereinafter set forth:
(i) If after the date hereof, and subject to the provisions of
Section 6.3 below, the number of outstanding shares of Common Stock is increased
by a stock dividend payable in shares of Common Stock or by a split-up of shares
of Common Stock or other similar event, then, on the effective date thereof, the
number of shares of Common Stock underlying each of the Units purchasable
hereunder shall be increased in proportion to such increase in outstanding
shares. In such case, the number of shares of Common Stock, and the exercise
price applicable thereto, underlying the Warrants underlying each of the Units
purchasable hereunder shall be adjusted in accordance with the terms of the
Warrants. For example, if the Company declares a two-for-one stock dividend and
at the time of such dividend this Unit Purchase Option is for the purchase of
one Unit at $7.50 per whole Unit (each Warrant underlying the Units is
exercisable for $2.50 per share), upon effectiveness of the dividend, this Unit
Purchase Option will be adjusted to allow for the purchase of one Unit at $7.50
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per Unit, each Unit entitling the holder to receive two shares of Common Stock
and four Warrants (each Warrant exercisable for $2.50 per share).
(ii) If after the date hereof, and subject to the provisions of
Section 6.4, the number of outstanding shares of Common Stock is decreased by a
consolidation, combination or reclassification of shares of Common Stock or
other similar event, then, on the effective date thereof, the number of shares
of Common Stock underlying each of the Units purchasable hereunder shall be
decreased in proportion to such decrease in outstanding shares. In such case,
the number of shares of Common Stock, and the exercise price applicable thereto,
issuable upon exercise of the Warrants included in each of the Units purchasable
hereunder shall be adjusted in accordance with the terms of the Warrants.
(iii) In case of any reclassification or reorganization of the
outstanding shares of Common Stock other than a change covered by Section
6(a)(i) or 6(a)(ii) hereof or that solely affects the par value of such shares
of Common Stock, or in the case of any merger or consolidation of the Company
with or into another corporation (other than a consolidation or merger in which
the Company is the continuing corporation and that does not result in any
reclassification or reorganization of the outstanding shares of Common Stock),
or in the case of any sale or conveyance to another corporation or entity of the
property of the Company as an entirety or substantially as an entirety in
connection with which the Company is dissolved, the Holder of this Unit Purchase
Option shall have the right thereafter (until the expiration of the right of
exercise of this Unit Purchase Option) to receive upon the exercise hereof, for
the same aggregate Exercise Price payable hereunder immediately prior to such
event, the kind and amount of shares of stock or other securities or property
(including cash) receivable upon such reclassification, reorganization, merger
or consolidation, or upon a dissolution following any such sale or transfer, by
a Holder of the number of shares of Common Stock of the Company obtainable upon
exercise of this Unit Purchase Option and the underlying Warrants immediately
prior to such event; and if any reclassification also results in a change in
shares of Common Stock covered by Section 6(a)(i) or 6(a)(ii), then such
adjustment shall be made pursuant to Sections 6(a)(i), 6(a)(ii) and this Section
6(a)(iii). The provisions of this Section 6(a)(iii) shall similarly apply to
successive reclassifications, reorganizations, mergers or consolidations, sales
or other transfers.
(iv) This form of Unit Purchase Option need not be changed
because of any change pursuant to this Section, and Unit Purchase Options issued
after such change may state the same Exercise Price and the same number of Units
as are stated in the Unit Purchase Options initially issued pursuant to this
Agreement. The acceptance by any Holder of the issuance of new Unit Purchase
Options reflecting a required or permissive change shall not be deemed to waive
any rights to an adjustment occurring after the Commencement Date or the
computation thereof.
(b) Substitute Unit Purchase Option. In case of any consolidation of
the Company with, or merger of the Company with, or merger of the Company into,
another corporation (other than a consolidation or merger which does not result
in any reclassification or change of the outstanding Common Stock), the
corporation formed by such consolidation or merger shall execute and deliver to
the Holder a supplemental Unit Purchase Option providing that the holder of each
Unit Purchase Option then outstanding or to be outstanding shall have the right
thereafter (until the stated expiration of such Unit Purchase Option) to
receive, upon exercise of such Unit Purchase Option, the kind and amount of
shares of stock and other securities and property receivable upon such
consolidation or merger, by a holder of the number of shares of Common Stock of
the Company for which such Unit Purchase Option might have been exercised
immediately prior to such consolidation, merger, sale or transfer. Such
supplemental Unit Purchase Option shall provide for adjustments which shall be
8
identical to the adjustments provided in Section 6. The above provision of this
Section shall similarly apply to successive consolidations or mergers.
(c) Fractional Interests. The Company shall not be required to issue
certificates representing fractions of shares of Common Stock or Warrants upon
the exercise of the Unit Purchase Option, nor shall it be required to issue
scrip or pay cash in lieu of any fractional interests, it being the intent of
the parties that all fractional interests shall be eliminated by rounding any
fraction up to the nearest whole number of Warrants, shares of Common Stock or
other securities, properties or rights.
7. Reservation and Listing. The Company shall at all times reserve and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon exercise of the Unit Purchase Options or the Warrants
underlying the Unit Purchase Option, such number of shares of Common Stock or
other securities, properties or rights as shall be issuable upon the exercise
thereof. The Company covenants and agrees that, upon exercise of the Unit
Purchase Options and payment of the Exercise Price therefor, all shares of
Common Stock and other securities issuable upon such exercise shall be duly and
validly issued, fully paid and non-assessable and not subject to preemptive
rights of any stockholder. The Company further covenants and agrees that upon
exercise of the Warrants underlying the Unit Purchase Options and payment of the
respective Warrant exercise price therefor, all shares of Common Stock and other
securities issuable upon such exercise shall be duly and validly issued, fully
paid and non-assessable and not subject to preemptive rights of any stockholder.
As long as the Unit Purchase Options shall be outstanding, the Company shall use
its best efforts to cause all (i) Units and shares of Common Stock issuable upon
exercise of the Unit Purchase Options, (iii) Warrants issuable upon exercise of
the Unit Purchase Options and (iv) shares of Common Stock issuable upon exercise
of the Warrants included in the Units issuable upon exercise of the Unit
Purchase Option to be listed (subject to official notice of issuance) on all
securities exchanges (or, if applicable on the Nasdaq National Market, SmallCap
Market, OTC Bulletin Board or any successor trading market) on which the Units,
the Common Stock or the Public Warrants issued to the public in connection
herewith may then be listed and/or quoted.
8. Certain Notice Requirements.
(a) Right to Notice. Nothing herein shall be construed as conferring
upon the Holders the right to vote or consent as a stockholder for the election
of directors or any other matter, or as having any rights whatsoever as a
stockholder of the Company. If, however, at any time prior to the expiration of
the Unit Purchase Options and their exercise, any of the events described in
Section 8(b) shall occur, then, in one or more of said events, the Company shall
give written notice of such event at least fifteen days prior to the date fixed
as a record date or the date of closing the transfer books for the determination
of the stockholders entitled to such dividend, distribution, conversion or
exchange of securities or subscription rights, or entitled to vote on such
proposed dissolution, liquidation, winding up or sale. Such notice shall specify
such record date or the date of the closing of the transfer books, as the case
may be. Notwithstanding the foregoing, the Company shall deliver to each Holder
a copy of each notice given to the other stockholders of the Company at the same
time and in the same manner that such notice is given to the stockholders.
(b) Enumerated Events. The Company shall be required to give the
notice described in this Section 8 upon one or more of the following events: (i)
if the Company shall take a record of the holders of its shares of Common Stock
for the purpose of entitling them to receive a dividend or distribution payable
otherwise than in cash, or a cash dividend or distribution payable otherwise
than out of retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company, or (ii) the Company shall
offer to all the holders of its Common Stock any additional shares of capital
stock of the Company or securities convertible into or exchangeable for shares
9
of capital stock of the Company, or any option, right or warrant to subscribe
therefor, or (iii) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale of all or
substantially all of its property, assets and business shall be proposed.
(c) Change in Exercise Price. The Company shall, promptly after an
event requiring a change in the Exercise Price pursuant to Section 6 hereof,
send notice to the Holders of such event and change (the "Price Notice"). The
Price Notice shall describe the event causing the change and the method of
calculating same and shall be certified as being true and accurate by the
Company's President and Chief Financial Officer.
(d) Notice Delivery. All notices, requests, consents and other
communications under this Unit Purchase Option shall be in writing and shall be
deemed to have been duly made when hand delivered, or mailed by express mail or
private courier service: (i) If to the registered Holder of the Unit Purchase
Option, to the address of such Holder as shown on the books of the Company, or
(ii) If to the Company, to the following address or to such other address as the
Company may designate by notice to the Holders:
Sand Hill IT Security Acquisition Corp.
0000 Xxxx Xxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: President
9. Miscellaneous.
(a) Amendments. The Company and Newbridge may from time to time
supplement or amend this Unit Purchase Option without the approval of any of the
Holders in order to cure any ambiguity, to correct or supplement any provision
contained herein that may be defective or inconsistent with any other provisions
herein, or to make any other provisions in regard to matters or questions
arising hereunder that the Company and Newbridge may deem necessary or desirable
and that the Company and Newbridge deem shall not adversely affect the interest
of the Holders. All other modifications or amendments shall require the written
consent of and be signed by the party against whom enforcement of the
modification or amendment is sought.
(b) Headings. The headings contained herein are for the sole purpose
of convenience of reference, and shall not in any way limit or affect the
meaning or interpretation of any of the terms or provisions of this Unit
Purchase Option.
10. Entire Agreement. This Unit Purchase Option (together with the other
agreements and documents being delivered pursuant to or in connection with this
Unit Purchase Option) constitutes the entire agreement of the parties hereto
with respect to the subject matter hereof, and supersedes all prior agreements
and understandings of the parties, oral and written, with respect to the subject
matter hereof.
(a) Binding Effect. This Unit Purchase Option shall inure solely to
the benefit of, and shall be binding upon, the Holder and the Company and their
permitted assignees, respective successors, legal representative and assigns,
and no other person shall have or be construed to have any legal or equitable
right, remedy or claim under or in respect of or by virtue of this Unit Purchase
Option or any provisions herein contained.
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(b) Governing Law. This Unit Purchase Option shall be governed by and
construed and enforced in accordance with the laws of the State of New York,
without giving effect to conflict of laws. The Company hereby agrees that any
action, proceeding or claim against it arising out of, or relating in any way to
this Unit Purchase Option shall be brought and enforced in the courts of the
State of New York or of the United States of America for the Southern District
of New York, and irrevocably submits to such jurisdiction, which jurisdiction
shall be exclusive. The Company hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenient forum. Any process
or summons to be served upon the Company may be served by transmitting a copy
thereof by registered or certified mail, return receipt requested, postage
prepaid, addressed to it at the address set forth in Section 8 hereof. Such
mailing shall be deemed personal service and shall be legal and binding upon the
Company in any action, proceeding or claim. The Company and the Holder agree
that the prevailing party(ies) in any such action shall be entitled to recover
from the other party(ies) all of its reasonable attorneys' fees and expenses
relating to such action or proceeding and/or incurred in connection with the
preparation therefor.
(c) Waivers. The failure of the Company or the Holder to at any time
enforce any of the provisions of this Unit Purchase Option shall not be deemed
or construed to be a waiver of any such provision, nor to in any way affect the
validity of this Unit Purchase Option or any provision hereof or the right of
the Company or any Holder to thereafter enforce each and every provision of this
Unit Purchase Option. No waiver of any breach, non-compliance or non-fulfillment
of any of the provisions of this Unit Purchase Option shall be effective unless
set forth in a written instrument executed by the party or parties against whom
or which enforcement of such waiver is sought; and no waiver of any such breach,
non-compliance or non-fulfillment shall be construed or deemed to be a waiver of
any other or subsequent breach, non-compliance or non-fulfillment.
(d) Counterparts. This Unit Purchase Option may be executed in one or
more counterparts, and by the different parties hereto in separate counterparts,
each of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement, and shall become effective when one
or more counterparts has been signed by each of the parties hereto and delivered
to each of the other parties hereto.
(e) Exchange Agreement. As a condition of the Holder's receipt and
acceptance of this Unit Purchase Option, Xxxxxx agrees that, at any time prior
to the complete exercise of this Unit Purchase Option by Holder, if the Company
and Newbridge enter into an agreement (the "Exchange Agreement") pursuant to
which they agree that all outstanding Unit Purchase Options will be exchanged
for securities or cash or a combination of both, then Holder shall agree to such
exchange and become a party to the Exchange Agreement.
IN WITNESS WHEREOF, the Company has caused this Unit Purchase Option to be
signed by its duly authorized officer as of the 30th day of July, 2004.
SAND HILL IT SECURITY ACQUISITION CORP.
By: /s/ Xxxx Xxxxxxxx
----------------------------------------
Name: Xxxx Xxxxxxxx
Title: Vice President and Chief Financial
Officer
11
FORM TO BE USED TO EXERCISE UNIT PURCHASE OPTION
------------------------------------------------
Sand Hill IT Security Acquisition Corp.
0000 Xxxx Xxxx Xxxx
Building 0, Xxxxx 000
Xxxxx Xxxx, XX 00000
Date: _________________, 2004
The undersigned hereby elects irrevocably to exercise all or a portion of
the within Unit Purchase Option and to purchase ____ Units of Sand Hill IT
Security Acquisition Corp. and hereby makes payment of $____________ (at the
rate of $_________ per Unit) in payment of the Exercise Price pursuant thereto.
Please issue the Common Stock and Warrants as to which this Unit Purchase Option
is exercised in accordance with the instructions given below. or
The undersigned hereby elects irrevocably to convert its right to purchase
_________ Units purchasable under the within Unit Purchase Option by surrender
of the unexercised portion of the attached Unit Purchase Option (with a "Value"
based of $________ based on a "Market Price" of $_______). Please issue the
securities comprising the Units as to which this Unit Purchase Option is
exercised in accordance with the instructions given below.
-----------------------------
Signature
-----------------------------
Signature Guaranteed
INSTRUCTIONS FOR REGISTRATION OF SECURITIES
Name ________________________________________________________________________
(Print in Block Letters)
Address ______________________________________________________________________
NOTICE: THE SIGNATURE TO THIS FORM MUST CORRESPOND WITH THE NAME AS WRITTEN UPON
THE FACE OF THE WITHIN UNIT PURCHASE OPTION IN EVERY PARTICULAR WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE GUARANTEED BY A
BANK, OTHER THAN A SAVINGS BANK, OR BY A TRUST COMPANY OR BY A FIRM HAVING
MEMBERSHIP ON A REGISTERED NATIONAL SECURITIES EXCHANGE.
12
FORM TO BE USED TO ASSIGN UNIT PURCHASE OPTION
----------------------------------------------
ASSIGNMENT
(To be executed by the registered Holder to effect a transfer of the within Unit
Purchase Option)
FOR VALUE RECEIVED, ___________________________________________ does hereby
sell, assign and transfer unto_______________________________________ the right
to purchase __________ Units of Sand Hill IT Security Acquisition Corp. (the
"Company") evidenced by the within Unit Purchase Option and does hereby
authorize the Company to transfer such right on the books of the Company.
Dated: ________________, 2004
-----------------------------
Signature
-----------------------------
Signature Guaranteed
NOTICE: THE SIGNATURE TO THIS FORM MUST CORRESPOND WITH THE NAME AS WRITTEN UPON
THE FACE OF THE WITHIN UNIT PURCHASE OPTION IN EVERY PARTICULAR WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE GUARANTEED BY A
BANK, OTHER THAN A SAVINGS BANK, OR BY A TRUST COMPANY OR BY A FIRM HAVING
MEMBERSHIP ON A REGISTERED NATIONAL SECURITIES EXCHANGE.
13
