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Exhibit 4.3
WARRANT AGREEMENT
by and between
2CONNECT EXPRESS, INC.
and
AMERICAN STOCK TRANSFER & TRUST COMPANY,
as Warrant Agent
and
STERNE, AGEE & XXXXX, INC.,
as Representative
Dated as of ________ ___, 0000
XXXXXXX AGREEMENT, dated this ____ day of ________, 1997, by and among
2CONNECT EXPRESS, INC., a Florida corporation (the "Company"), AMERICAN STOCK
TRANSFER & TRUST COMPANY, as Warrant Agent (the "Warrant Agent"), and STERNE,
AGEE & XXXXX, INC., as Representative (the "Representative").
WITNESSETH:
WHEREAS, the Company has filed with the Securities and Exchange Commission
a Registration Statement on Form SB-2 with respect to an initial public offering
of up to (i) 850,000 Units ("Units"), each Unit consisting of three shares of
the Company's Common Stock, par value $.01 per share, and one common stock
purchase warrant (the "Warrants"), each Warrant entitling the holder thereof to
purchase one share of Common Stock at a price equal to $4.00 per share, (ii) the
over-allotment option to purchase up to an additional 127,500 Units from the
Company (the "Over-allotment Option"), and (iii) the sale to the Representative
of 59,500 warrants (the "Representative's Warrants") to purchase up to 59,500
Units. The Warrants and Representative's Warrants are subject to increase as
provided herein and in the Representative's Warrant Agreement;
WHEREAS, the Company desires to provide for the issuance of certificates
representing the Warrants; and
WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing to so act, in connection with the
issuance, registration, transfer, exchange and redemption of the Warrants, the
issuance of certificates representing the Warrants, the exercise of the
Warrants and the rights of the holders thereof.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
hereinafter set forth and for the purpose of defining the terms and provisions
of the Warrants and the certificates representing the Warrants and the
respective rights and obligations thereunder of the Company, the
Representative, the holders of certificates representing the Warrants and the
Warrant Agent, the parties hereto agree as follows:
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SECTION 1. Definitions.
As used herein, the following terms shall have the following meanings,
unless the context shall otherwise require:
(a) "Act" shall mean the Securities Act of 1933, as amended.
(b) "NASDAQ" shall mean National Association of Securities
Dealers Automated Quotation system.
(c) "Common Stock" shall mean the authorized stock of the Company
of any class, whether now or hereafter authorized, which has the
right to participate in the voting and in the distribution of
earnings and assets of the Company without limit as to amount or
percentage which at the date hereof consists of 25,000,000 shares of
Common Stock, $.01 par value per share.
(d) "Commission" shall mean the Securities and Exchange
Commission.
(e) "Corporate Office shall mean the office of the Warrant Agent
(or its successor) at which at any particular time its business in
New York, New York, shall be administered, which office is located
on the date hereof at ___ Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx _______.
(f) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
(g) "Exercise Date" shall mean, subject to the provisions of
Section 5(b) hereof, as to any Warrant, the date on which the
Warrant Agent shall have received both (i) the Warrant Certificate
representing such Warrant, with the exercise form thereon duly
executed by the Registered Holder thereof or his attorney duly
authorized in writing, and (ii) payment in cash or by official bank
or certified check made payable to the Warrant Agent for the account
of the Company, of the amount in lawful money of the United States
of America equal to the applicable Purchase Price (as hereinafter
defined) in good funds.
(h) "Initial Warrant Exercise Date" shall mean ______________,
1998 (one year from the effective date of the Registration
Statement).
(i) "NASD" shall mean the National Association of Securities
Dealers, Inc.
(j) "Purchase Price" shall mean, subject to modification and
adjustment as provided in Section 8, $4.00 per share of Common
Stock.
(k) "Registered Holder" shall mean the person in whose name any
certificate representing the Warrants shall be registered on the
books maintained by the Warrant Agent pursuant to Section 6.
(l) "Representative's Warrant Agreement" shall mean the agreement
dated as of ________, 1997 (the date of the Prospectus) between the
Company and the Representative relating to and governing the terms
and provisions of the Representative's Warrants.
(m) "Transfer Agent" shall mean American Stock Transfer & Trust
Company, or its authorized successor.
(n) "Underwriting Agreement" shall mean the underwriting
agreement dated _________, 1997 (the date of the Prospectus) between
the Company and the several underwriters listed therein relating to
the purchase for resale to the public of the 850,000 Units.
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(o) "Warrant Certificate" shall mean a certificate representing
each of the Warrants substantially in the form annexed hereto as
Exhibit A.
(p) "Warrant Expiration Date" shall mean 5:30 p.m. (New York
time), on ________, 1998 (14 months from the effective date of the
Registration Statement); provided, that if such date shall in the
State of New York be a holiday or a day on which banks are
authorized to close, then 5:30 p.m. (New York time) on the next
following day which, in the State of New York, is not a holiday or a
day on which banks are authorized to close; and provided, further,
that the Warrant Expiration Date shall not occur until such time as
a current and effective registration statement covering the Common
Stock underlying the Warrants shall have been in effect for at least
60 days following the Initial Warrant Exercise Date. Upon five
business days' prior written notice to the Registered Holders, the
Company shall have the right to extend the Warrant Expiration Date.
SECTION 2. Warrants and Issuance of Warrant Certificates.
(a) Each Warrant shall initially entitle the Registered Holder of
the Warrant Certificate representing such Warrant to purchase at the
Purchase Price therefor from the Initial Warrant Exercise Date until
the Warrant Expiration Date one share of Common Stock upon the
exercise thereof in accordance with the terms hereof, subject to
modification and adjustment as provided in Section 8.
(b) Upon execution of this Agreement, Warrant Certificates
representing the number of Warrants sold pursuant to the
Underwriting Agreement (subject to modification and adjustment as
provided in Section 8) shall be executed by the Company and
delivered to the Warrant Agent.
(c) Upon exercise of the Representative's Warrants as provided
therein, Warrant Certificates representing all or a portion of
59,500 Warrants to purchase up to an aggregate of 59,500 shares of
Common Stock (subject to modification and adjustment as provided in
Section 8 hereof and in the Representative's Warrant Agreement),
shall be countersigned, issued and delivered by the Warrant Agent
upon written order of the Company signed by its Chairman of the
Board, Chief Executive Officer, President or a Vice President and by
its Treasurer or an Assistant Treasurer or its Secretary or an
Assistant Secretary.
(d) From time to time, commencing on the Initial Warrant Exercise
Date and continuing up to the Warrant Expiration Date, the Warrant
Agent shall countersign and deliver Warrant Certificates in required
denominations of one or whole number multiples thereof to the person
entitled thereto in connection with any transfer or exchange
permitted under this Agreement. Except as provided herein, no
Warrant Certificates shall be issued except (i) Warrant Certificates
initially issued hereunder, those issued pursuant to the exercise of
the Over-allotment Option and those issued on or after the Initial
Warrant Exercise Date, upon the exercise of fewer than all Warrants
held by the exercising Registered Holder, (ii) Warrant Certificates
issued upon any transfer or exchange of Warrants, (iii) Warrant
Certificates issued in replacement of lost, stolen, destroyed or
mutilated Warrant Certificates pursuant to Section 7, (iv) Warrant
Certificates issued pursuant to the Representative's Warrant
Agreement, and (v) at the option of the Company, Warrant
Certificates in such form as may be approved by its Board of
Directors, to reflect any adjustment or change in the Purchase
Price, the number of shares of Common Stock purchasable upon
exercise of the Warrants or the Redemption Price therefor made
pursuant to Section 8 hereof.
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SECTION 3. Form and Execution of Warrant Certificates.
(a) The Warrant Certificates shall be substantially in the form
annexed hereto as Exhibit A (the provisions of which are hereby
incorporated herein) and may have such letters, numbers or other
marks of identification or designation and such legends, summaries
or endorsements printed, lithographed or engraved thereon as the
Company may deem appropriate and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply with
any law or with any rule or regulation made pursuant thereto, or to
conform to usage. The Warrant Certificates shall be dated the date
of issuance thereof (whether upon initial issuance, transfer,
exchange or in lieu of mutilated, lost, stolen or destroyed Warrant
Certificates) and issued in registered form. Warrants shall be
numbered serially with the letter W on the Warrants.
(b) Warrant Certificates shall be executed on behalf of the
Company by its Chairman of the Board, Chief Executive Officer,
President or any Vice President and by its Treasurer or an Assistant
Treasurer or its Secretary or an Assistant Secretary, by manual
signatures or by facsimile signatures printed thereon, and shall
have imprinted thereon a facsimile of the Company's seal. Warrant
Certificates shall be manually countersigned by the Warrant Agent
and shall not be valid for any purpose unless so countersigned. In
case any officer of the Company who shall have signed any of the
Warrant Certificates shall cease to be such officer of the Company
before the date of issuance of the Warrant Certificates or before
countersignature by the Warrant Agent and issue and delivery
thereof, such Warrant Certificates, nevertheless, may be
countersigned by the Warrant Agent, issued and delivered with the
same force and effect as though the person who signed such Warrant
Certificates had not ceased to be such officer of the Company.
After countersignature by the Warrant Agent, Warrant Certificates
shall be delivered by the Warrant Agent to the Registered Holder
promptly and without further action by the Company, except as
otherwise provided by Section 4(a) hereof.
SECTION 4. Exercise of Warrants; Payment of Warrant Solicitation Fee.
(a) Warrants in denominations of one or whole number multiples
thereof may be exercised by the Registered Holder thereof commencing
at any time on or after the Initial Warrant Exercise Date, but not
after the Warrant Expiration Date, upon the terms and subject to the
conditions set forth herein and in the applicable Warrant
Certificate. A Warrant shall be deemed to have been exercised
immediately prior to the close of business on the Exercise Date and
the person entitled to receive the securities deliverable upon such
exercise shall be treated for all purposes as the holder, upon
exercise thereof, as of the close of business on the Exercise Date.
If Warrants in denominations other than whole number multiples
thereof shall be exercised at one time by the same Registered
Holder, the number of full shares of Common Stock which shall be
issuable upon exercise thereof shall be computed on the basis of the
aggregate number of full shares of Common Stock issuable upon such
exercise. As soon as practicable on or after the Exercise Date and
in any event within five business days after such date, if one or
more Warrants have been exercised, the Warrant Agent on behalf of
the Company shall cause to be issued to the person or persons
entitled to receive the same a Common Stock certificate or
certificates for the shares of Common Stock deliverable upon such
exercise, and the Warrant Agent shall deliver the same to the person
or persons entitled thereto. Upon the exercise of any one or more
Warrants, the Warrant Agent shall promptly notify the Company in
writing of such fact and of the number of securities delivered upon
such exercise and, subject to subsection (b) below, shall cause all
payments of an amount in cash or by check made payable to the order
of the Company, equal to the Purchase Price, to be deposited
promptly in the Company's bank account.
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(b) At any time upon the exercise of any Warrants, the Warrant
Agent shall, on a daily basis, within two business days after such
exercise, notify the Representative of the exercise of any such
Warrants and shall, on a weekly basis (subject to collection of
funds constituting the tendered Purchase Price, but in no event
later than five business days after the last day of the calendar
week in which such funds were tendered), remit to the Representative
an amount equal to five percent (5%) of the Purchase Price of such
Warrants then being exercised unless the Representative shall have
notified the Warrant Agent that the payment of such amount with
respect to such Warrant is violative of the General Rules and
Regulations promulgated under the Exchange Act, or the rules and
regulations of the NASD or applicable state securities or "blue sky"
laws, or the Warrants are those underlying the Representative's
Warrants in which event, the Warrant Agent shall have to pay such
amount to the Company; provided, that the Warrant Agent shall not be
obligated to pay any amounts pursuant to this Section 4(b) during
any week that such amounts payable are less than $1,000 and the
Warrant Agent's obligation to make such payments shall be suspended
until the amount payable aggregates $1,000, and provided further,
that, in any event, any such payment (regardless of amount) shall be
made not less frequently than monthly. Notwithstanding the
foregoing, the Representative shall be entitled to receive the
commission contemplated by this Section 4(b) as Warrant solicitation
agent only if: (i) the Representative has provided actual services
in connection with the solicitation of the exercise of a Warrant by
a Registered Holder and (ii) the Registered Holder exercising a
Warrant(s) affirmatively designates in writing on the exercise form
on the reverse side of the Warrant Certificate that the exercise of
such Registered Holder's Warrant(s) was solicited by the
Representative.
(c) The Company shall not be required to issue fractional shares
on the exercise of Warrants. Warrants may only be exercised in such
multiples as are required to permit the issuance by the Company of
one or more whole shares. If one or more Warrants shall be presented
for exercise in full at the same time by the same Registered Holder,
the number of whole shares which shall be issuable upon such
exercise thereof shall be computed on the basis of the aggregate
number of shares purchasable on exercise of the Warrants so
presented. If any fraction of a share would, except for the
provisions provided herein, be issuable on the exercise of any
Warrant (or specified portion thereof), the Company shall pay an
amount in cash equal to such fraction multiplied by the then current
market value of a share of Common Stock, determined as follows:
(1) If the Common Stock is listed, or admitted to
unlisted trading privileges, on NASDAQ or a national
securities exchange, the current market value of a share of
Common Stock shall be the closing sale price of the Common
Stock at the end of the regular trading session on the last
business day prior to the date of exercise of the Warrants on
whichever of such exchanges had the highest average daily
trading volume for the Common Stock on such day; or
(2) If the Common Stock is not listed or admitted to
unlisted trading privileges on any national securities
exchange, but is traded in the over-the-counter market, the
current market value of a share of Common Stock shall be the
average of the last reported bid and asked prices of the
Common Stock reported by the National Quotation Bureau, Inc.
on the last business day prior to the date of exercise of the
Warrants; or
(3) If the Common Stock is not listed or admitted to
unlisted trading privileges on any national securities
exchange, and bid and asked prices of the Common Stock are not
reported by the National Quotation Bureau, Inc., the current
market value of a share of Common Stock shall be an amount,
not less than the book value thereof as of the end of the most
recently completed fiscal quarter of the Company ending
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prior to the date of exercise, determined by the members of
the Board of Directors of the Company exercising good faith
and using customary valuation methods.
SECTION 5. Reservation of Shares; Listing; Payment of Taxes; etc.
(a) The Company covenants that it will at all times reserve and
keep available out of its authorized Common Stock, solely for the
purpose of issue upon exercise of Warrants, such number of shares of
Common Stock as shall then be issuable upon the exercise of all
outstanding Warrants. The Company covenants that all shares of
Common Stock which shall be issuable upon exercise of the Warrants
shall, at the time of delivery thereof, be duly and validly issued
and fully paid and nonassessable and free from all preemptive or
similar rights, taxes, liens and charges with respect to the issue
thereof, and that upon issuance such shares shall be listed on each
securities exchange, if any, on which the other shares of
outstanding Common Stock of the Company are then listed.
(b) The Company covenants that if any securities to be reserved
for the purpose of exercise of Warrants hereunder require
registration with, or approval of, any governmental authority under
any federal securities law before such securities may be validly
issued or delivered upon such exercise, then the Company will file a
registration statement under the federal securities laws or a
post-effective amendment, use its best efforts to cause the same to
become effective and to keep such registration statement current
while any of the Warrants are outstanding and deliver a prospectus
which complies with Section 10(a)(3) of the Act, to the Registered
Holder exercising the Warrant (except, if in the opinion of counsel
to the Company, such registration is not required under the federal
securities laws or if the Company receives a letter from the Staff
of the Commission stating that it would not take any enforcement
action if such registration is not effected). The Company will use
its best efforts to obtain appropriate approvals or registrations
under state "blue sky" securities laws with respect to any such
securities. However, Warrants may not be exercised by, or shares of
Common Stock issued to, any Registered Holder in any state in which
such exercise would be unlawful.
(c) The Company shall pay all documentary, stamp or similar taxes
and other governmental charges that may be imposed with respect to
the issuance of Warrants, or the issuance or delivery of any shares
of Common Stock upon exercise of the Warrants; provided, however,
that if shares of Common Stock are to be delivered in a name other
than the name of the Registered Holder of the Warrant Certificate
representing any Warrant being exercised, then no such delivery
shall be made unless the person requesting the same has paid to the
Warrant Agent the amount of transfer taxes or charges incident
thereto, if any.
(d) The Warrant Agent is hereby irrevocably authorized as the
Transfer Agent to requisition from time to time certificates
representing shares of Common Stock or other securities required
upon exercise of the Warrants, and the Company will comply with all
such requisitions.
SECTION 6. Exchange and Registration of Transfer.
(a) Warrant Certificates may be exchanged for other Warrant
Certificates representing an equal aggregate number of Warrants of
the same class or may be transferred in whole or in part. Warrant
Certificates to be exchanged shall be surrendered to the Warrant
Agent at its Corporate Office, and, upon satisfaction of the terms
and provisions hereof, the Company shall execute and the Warrant
Agent shall countersign, issue and deliver in exchange therefor the
Warrant Certificate or Certificates which the Registered Holder
making the exchange shall be entitled to receive.
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(b) The Warrant Agent shall keep, at its office, books in which,
subject to such reasonable regulations as it may prescribe, it shall
register Warrant Certificates and the transfer thereof in accordance
with customary practice. Upon due presentment for registration of
transfer of any Warrant Certificate at such office, the Company
shall execute and the Warrant Agent shall issue and deliver to the
transferee or transferees a new Warrant Certificate or Certificates
representing an equal aggregate number of Warrants of the same
class.
(c) With respect to all Warrant Certificates presented for
registration of transfer, or for exchange or exercise, the
subscription or exercise form, as the case may be, on the reverse
thereof shall be duly endorsed or be accompanied by a written
instrument or instruments of transfer and subscription, in form
satisfactory to the Company and the Warrant Agent, duly executed by
the Registered Holder thereof or his attorney-in-fact duly
authorized in writing.
(d) A service charge may be imposed by the Warrant Agent for any
exchange or registration of transfer of Warrant Certificates. In
addition, the Company may require payment by such Holder of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith.
(e) All Warrant Certificates surrendered for exercise or for
exchange in case of mutilated Warrant Certificates shall be promptly
canceled by the Warrant Agent and thereafter retained by the Warrant
Agent until termination of this Agreement.
(f) Prior to due presentment for registration of transfer
thereof, the Company and the Warrant Agent may deem and treat the
Registered Holder of any Warrant Certificate as the absolute owner
thereof and of each Warrant represented thereby (notwithstanding any
notations of ownership or writing thereon made by anyone other than
a duly authorized officer of the Company or the Warrant Agent) for
all purposes and shall not be affected by any notice to the
contrary.
SECTION 7. Loss or Mutilation.
Upon receipt by the Company and the Warrant Agent of evidence
satisfactory to them of the ownership of and the loss, theft, destruction
or mutilation of any Warrant Certificate and (in the case of loss, theft
or destruction) of indemnity satisfactory to them, and (in case of
mutilation) upon surrender and cancellation thereof, the Company shall
execute and the Warrant Agent shall (in the absence of notice to the
Company and/or the Warrant Agent that a new Warrant Certificate has been
acquired by a bona fide purchaser) countersign and deliver to the
Registered Holder in lieu thereof a new Warrant Certificate of like tenor
representing an equal aggregate number of Warrants. Applicants for a
substitute Warrant Certificate shall also comply with such other
reasonable regulations and pay such other reasonable charges as the
Warrant Agent may prescribe.
SECTION 8. Adjustment of Purchase Price and Number of Shares of Common Stock
Deliverable.
(a) Except as hereinafter provided, in the event the Company
shall, at any time or from time to time after the date hereof and
prior to the Warrant Expiration Date, issue any shares of Common
Stock as a stock dividend to the holders of Common Stock, or
subdivide or combine the outstanding shares of Common Stock into a
greater or lesser number of shares (any such issuance, subdivision
or combination being herein called a "Change of Shares"), then, and
thereafter upon each further Change of Shares, the Purchase Price
for the Warrants (whether or not the same shall be issued and
outstanding) in effect immediately prior to such Change of Shares
shall be changed to a price (including any applicable fraction of a
cent to the nearest cent) determined by dividing (i) the total
number of shares of Common Stock outstanding immediately prior to
such Change of Shares, multiplied by the Purchase Price in effect
immediately prior to such Change of Shares by (ii) the total number
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of shares of Common Stock outstanding immediately after such Change
of Shares; provided, however, that in no event shall the Purchase
Price be adjusted pursuant to this computation to an amount in
excess of the Purchase Price in effect immediately prior to such
computation, except in the case of a combination of outstanding
shares of Common Stock.
For the purposes of any adjustment to be made in accordance with
this Section 8(a), the following provisions shall be applicable:
(A) Shares of Common Stock issuable by way of dividend or other
distribution on any stock of the Company shall be deemed to have
been issued immediately after the opening of business on the day
following the record date for the determination of shareholders
entitled to receive such dividend or other distribution and shall
be deemed to have been issued without consideration.
(B) The reclassification of securities of the Company other than
shares of Common Stock into securities including shares of Common
Stock shall be deemed to involve the issuance of such shares of
Common Stock immediately prior to the close of business on the date
fixed for the determination of security holders entitled to receive
such shares.
(C) The number of shares of Common Stock at any one time
outstanding shall be deemed to include the aggregate maximum number
of shares issuable (subject to readjustment upon the actual
issuance thereof) upon the exercise of options, rights or warrants
and upon the conversion or exchange of convertible or exchangeable
securities.
(b) Upon each adjustment of the Purchase Price pursuant to this
Section 8, the number of shares of Common Stock purchasable upon the
exercise of each Warrant shall be the number derived by multiplying
the number of shares of Common Stock purchasable immediately prior
to such adjustment by the Purchase Price in effect prior to such
adjustment and dividing the product so obtained by the applicable
adjusted Purchase Price.
(c) In case of any reclassification or change of outstanding
shares of Common Stock issuable upon exercise of the Warrants (other
than a change in par value, or from par value to no par value, or
from no par value to par value or as a result of a subdivision or
combination), or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a
subsidiary of the Company in which merger the Company is the
continuing corporation) and which does not result in any
reclassification or change of the then outstanding shares of Common
Stock or other capital stock issuable upon exercise of the Warrants
(other than a change in par value, or from par value to no par
value, or from no par value to par value or as a result of a
subdivision or combination) or in case of any sale or conveyance to
another corporation of the property of the Company as an entirety or
substantially as an entirety, then, as a condition of such
reclassification, change, consolidation, merger, sale or conveyance,
the Company, or such successor or purchasing corporation, as the
case may be, shall make lawful and adequate provision whereby the
Registered Holder of each Warrant then outstanding shall have the
right thereafter to receive on exercise of such Warrant the kind and
amount of securities and property receivable upon such
reclassification, change, consolidation, merger, sale or conveyance
by a holder of the number of securities issuable upon exercise of
such Warrant immediately prior to such reclassification, change,
consolidation, merger, sale or conveyance and shall forthwith file
at the Corporate Office of the Warrant Agent a statement signed by
its Chief Executive Officer, President or a Vice President and by
its Treasurer or an Assistant Treasurer or its Secretary or an
Assistant Secretary evidencing such provision. Such provisions
shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in
Sections 8(a) and (b). The above
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provisions of this Section 8(c) shall similarly apply to successive
reclassifications and changes of shares of Common Stock and to
successive consolidations, mergers, sales or conveyances.
(d) Irrespective of any adjustments or changes in the Purchase
Price or the number of shares of Common Stock purchasable upon
exercise of the Warrants, the Warrant Certificates theretofore and
thereafter issued shall, unless the Company shall exercise its
option to issue new Warrant Certificates pursuant to Section 2(d)
hereof, continue to express the Purchase Price per share and the
number of shares purchasable thereunder as the Purchase Price per
share and the number of shares purchasable thereunder were expressed
in the Warrant Certificates when the same were originally issued.
(e) After each adjustment of the Purchase Price pursuant to this
Section 8, the Company will promptly prepare a certificate signed by
the Chairman, Chief Executive Officer or President, and by the
Treasurer or an Assistant Treasurer or the Secretary or an Assistant
Secretary, of the Company setting forth: (i) the Purchase Price as
so adjusted, (ii) the number of shares of Common Stock purchasable
upon exercise of each Warrant, after such adjustment, and (iii) a
brief statement of the facts accounting for such adjustment. The
Company will promptly file such certificate with the Warrant Agent
and cause a brief summary thereof to be sent by ordinary first class
mail to each Registered Holder at his last address as it shall
appear on the registry books of the Warrant Agent. No failure to
mail such notice nor any defect therein or in the mailing thereof
shall affect the validity thereof except as to the holder to whom
the Company failed to mail such notice, or except as to the holder
whose notice was defective. The affidavit of an officer of the
Warrant Agent or the Secretary or an Assistant Secretary of the
Company that such notice has been mailed shall, in the absence of
fraud, be prima facie evidence of the facts stated therein.
(f) No adjustment of the Purchase Price shall be made as a result
of or in connection with (A) the issuance or sale of shares of
Common Stock pursuant to options, warrants, stock purchase
agreements, asset purchase agreements and convertible or
exchangeable securities; or (B) the issuance or sale of shares of
Common Stock if the amount of said adjustment shall be less than
$.10, provided, however, that in such case, any adjustment that
would otherwise be required then to be made shall be carried forward
and shall be made at the time of and together with the next
subsequent adjustment that shall amount, together with any
adjustment so carried forward, to at least $.10. In addition,
Registered Holders shall not be entitled to cash dividends paid by
the Company prior to the exercise of any Warrant or Warrants held by
them.
SECTION 9. Concerning the Warrant Agent.
(a) The Warrant Agent acts hereunder as agent and in a
ministerial capacity for the Company and the Representative, and its
duties shall be determined solely by the provisions hereof. The
Warrant Agent shall not, by issuing and delivering Warrant
Certificates or by any other act hereunder, be deemed to make any
representations as to the validity or value or authorization of the
Warrant Certificates or the Warrants represented thereby or of any
securities or other property delivered upon exercise of any Warrant
or whether any stock issued upon exercise of any Warrant is fully
paid and nonassessable.
(b) The Warrant Agent shall not at any time be under any duty or
responsibility to any holder of Warrant Certificates to make or
cause to be made any adjustment of the Purchase Price or the
Redemption Price provided in this Agreement, or to determine whether
any fact exists which may require any such adjustments, or with
respect to the nature or extent of any such adjustments, when made,
or with respect to the method employed in making the same. It shall
not (i) be liable for any recital or statement of fact contained
herein or for any action
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taken, suffered or omitted by it in reliance on any Warrant
Certificate or other document or instrument believed by it in good
faith to be genuine and to have been signed or presented by the
proper party or parties, (ii) be responsible for any failure on the
part of the Company to comply with any of its covenants and
obligations contained in this Agreement or in any Warrant
Certificate, or (iii) be liable for any act or omission in
connection with this Agreement except for its own negligence, bad
faith or willful misconduct.
(c) The Warrant Agent may at any time consult with counsel
satisfactory to it (who may be counsel for the Company or for the
Representative) and shall incur no liability or responsibility for
any action taken, suffered or omitted by it in good faith in
accordance with the opinion or advice of such counsel.
(d) Any notice, statement, instruction, request, direction, order
or demand of the Company shall be sufficiently evidenced by an
instrument signed by the Chairman of the Board of Directors, Chief
Executive Officer, President or Chief Financial Officer (unless
other evidence in respect thereof is herein specifically
prescribed). The Warrant Agent shall not be liable for any action
taken, suffered or omitted by it in accordance with such notice,
statement, instruction, request, direction, order or demand
reasonably believed by it to be genuine.
(e) The Company agrees to pay the Warrant Agent reasonable
compensation for its services hereunder and to reimburse it for its
reasonable expenses hereunder; the Company further agrees to
indemnify the Warrant Agent and save it harmless from and against
any and all losses, expenses and liabilities, including judgments,
costs and counsel fees, for anything done or omitted by the Warrant
Agent in the execution of its duties and powers hereunder except
losses, expenses and liabilities arising as a result of the Warrant
Agent's negligence, bad faith or willful misconduct.
(f) The Warrant Agent may resign its duties and be discharged
from all further duties and liabilities hereunder (except
liabilities arising as a result of the Warrant Agent's own
negligence or willful misconduct), after giving 30 days' prior
written notice to the Company. At least 15 days prior to the date
such resignation is to become effective, the Warrant Agent shall
cause a copy of such notice of resignation to be mailed to the
Registered Holder of each Warrant Certificate at the Company's
expense. Upon such resignation, or any inability of the Warrant
Agent to act as such hereunder, the Company shall appoint in writing
a new warrant agent. If the Company shall fail to make such
appointment within a period of 15 days after it has been notified in
writing of such resignation by the resigning Warrant Agent, then the
Registered Holder of any Warrant Certificate may apply to any court
of competent jurisdiction for the appointment of a new warrant
agent. Any new warrant agent, whether appointed by the Company or
by such a court, shall be a bank or trust company having a capital
and surplus, as shown by its last published report to its
stockholders, of not less than $10,000,000 or a stock transfer
company. After acceptance in writing of such appointment by the new
warrant agent is received by the Company, such new warrant agent
shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named herein as the
Warrant Agent, without any further assurance, conveyance, act or
deed; but if for any reason it shall be necessary or expedient to
execute and deliver any further assurance, conveyance, act or deed,
the same shall be done at the expense of the Company and shall be
legally and validly executed and delivered by the resigning Warrant
Agent. Not later than the effective date of any such appointment the
Company shall file notice thereof with the resigning Warrant Agent
and shall forthwith cause a copy of such notice to be mailed to the
Registered Holder of each Warrant Certificate.
(g) Any corporation into which the Warrant Agent or any new
warrant agent may be converted or merged, any corporation resulting
from any consolidation to which the Warrant Agent or any new warrant
agent shall be a party, or any corporation succeeding to the
corporate trust
10
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business of the Warrant Agent or any new warrant agent shall be a
successor warrant agent under this Agreement without any further
act, provided that such corporation is eligible for appointment as
successor to the Warrant Agent under the provisions of the
preceding paragraph. Any such successor warrant agent shall
promptly cause notice of its succession as warrant agent to be
mailed to the Company and to the Registered Holders of each Warrant
Certificate.
(h) The Warrant Agent, its subsidiaries and affiliates, and any
of its or their officers or directors, may buy and hold or sell
Warrants or other securities of the Company and otherwise deal with
the Company in the same manner and to the same extent and with like
effect as though it were not Warrant Agent. Nothing herein shall
preclude the Warrant Agent from acting in any other capacity for the
Company or for any other legal entity.
(i) The Warrant Agent shall retain for a period of two years from
the date of exercise any Warrant Certificate received by it upon
such exercise.
SECTION 10. Modification of Agreement.
The Warrant Agent and the Company may by supplemental agreement make any
changes or corrections in this Agreement (i) that they shall deem
appropriate to cure any ambiguity or to correct any defective or
inconsistent provision or manifest mistake or error herein contained; or
(ii) that they may deem necessary or desirable and which shall not
adversely affect the interests of the holders of Warrant Certificates;
provided, however, that this Agreement shall not otherwise be modified,
supplemented or altered in any respect except with the consent in writing
of the Registered Holders representing not less than 66-2/3% of the
Warrants then outstanding; provided, further, that no change in the
number or nature of the securities purchasable upon the exercise of any
Warrant, or to increase the Purchase Price therefor or to accelerate the
Warrant Expiration Date, shall be made without the consent in writing of
the Registered Holder of the Warrant Certificate representing such
Warrant, other than such changes as are presently specifically prescribed
by this Agreement as originally executed. In addition, this Agreement
may not be modified, amended or supplemented without the prior written
consent of the Representative, other than to cure any ambiguity or to
correct any provision which is inconsistent with any other provision of
this Agreement or to make any such change that is necessary or desirable
and which shall not adversely affect the interests of the Representative
and except as may be required by law.
SECTION 11. Notices.
All notices, requests, consents and other communications hereunder shall
be in writing and shall be deemed to have been made when delivered or
mailed first-class registered or certified mail, postage prepaid, as
follows: if to the Registered Holder of a Warrant Certificate, at the
address of such holder as shown on the registry books maintained by the
Warrant Agent; if to the Company at 2Connect Express, Inc., 0000 X.X.
00xx Xxxxxx, Xxxxx 0, Xxxxxxxxxx, Xxxxxxx 00000, Attention: Xxxx Xxxxxxx,
President and Chief Executive Officer, or at such other address as may
have been furnished to the Warrant Agent in writing by the Company; and
if to the Warrant Agent, at its Corporate Office. Copies of any notice
delivered pursuant to this Agreement shall also be delivered to the
Representative at 0000 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxxxxxxx,
Xxxxxxx 00000, Attention: Xxxxx X. Xxxxxxxx, Xx., Chairman and Chief
Executive Officer, or at such other address as may have been furnished to
the Company and the Warrant Agent in writing.
SECTION 12. Governing Law.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Florida without giving effect to conflicts of laws.
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SECTION 13. Binding Effect.
This Agreement shall be binding upon and inure to the benefit of the
Company, the Representative, the Warrant Agent and their respective
successors and assigns and the holders from time to time of Warrant
Certificates or any of them. Nothing in this Agreement is intended or
shall be construed to confer upon any other person any right, remedy or
claim, in equity or at law, or to impose upon any other person any duty,
liability or obligation.
SECTION 14. Termination.
This Agreement shall terminate at the close of business on the Expiration
Date of all of the Warrants or such earlier date upon which all Warrants
have been exercised or redeemed, except that the Warrant Agent shall
account to the Company for cash held by it and the provisions of Section
10 hereof shall survive such termination.
SECTION 15. Counterparts.
This Agreement may be executed in several counterparts, which taken
together shall constitute a single document.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
SEAL
2CONNECT EXPRESS, INC.
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
Attest:
By:
--------------------
Name:
---------------
Title:
--------------
AMERICAN STOCK TRANSFER & TRUST COMPANY,
as Warrant Agent
By:
--------------------------------
Name:
---------------------------
Title:
--------------------------
STERNE, AGEE & XXXXX, INC.,
as Representative
By:
--------------------------------
Name:
---------------------------
Title:
--------------------------
12
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EXHIBIT A
No. W______________
VOID AFTER _________________, 2001
WARRANTS
WARRANT CERTIFICATE TO
PURCHASE ONE SHARE OF COMMON STOCK
2CONNECT EXPRESS, INC.
CUSIP____________
THIS CERTIFIES THAT, FOR VALUE RECEIVED or registered assigns (the
"Registered Holder") is the owner of the number of Warrants (the "Warrants")
specified above. Each Warrant initially entitles the Registered Holder to
purchase, subject to the terms and conditions set forth in this Certificate and
the Warrant Agreement (as hereinafter defined), one fully paid and
nonassessable share of Common Stock, $.01 par value, of 2CONNECT EXPRESS, INC.,
a Florida corporation (the "Company"), at any time between ________, 1998 (the
"Initial Warrant Exercise Date"), and the Expiration Date (as hereinafter
defined) upon the presentation and surrender of this Warrant Certificate with
the Subscription Form on the reverse hereof duly executed, at the corporate
office of American Stock Transfer & Trust Company, as Warrant Agent, or its
successor (the "Warrant Agent"), accompanied by payment of $4.00 per share of
Common Stock, subject to adjustment (the "Purchase Price"), in lawful money of
the United States of America in cash or by check made payable to the Warrant
Agent for the account of the Company.
This Warrant Certificate and each Warrant represented hereby are issued
pursuant to and are subject in all respects to the terms and conditions set
forth in the Warrant Agreement (the "Warrant Agreement"), dated
___________,1997 ), between the Company, Sterne, Agee & Xxxxx, Inc. (the
"Representative") and the Warrant Agent.
In the event of certain contingencies provided for in the Warrant
Agreement, the Purchase Price and the number of shares of Common Stock subject
to purchase upon the exercise of each Warrant represented hereby are subject to
modification or adjustment.
Each Warrant represented hereby is exercisable at the option of the
Registered Holder, but no fractional interests will be issued. In the case of
the exercise of less than all the Warrants represented hereby, the Company
shall cancel this Warrant Certificate upon the surrender hereof and shall
execute and deliver a new Warrant Certificate or Warrant Certificates of like
tenor, which the Warrant Agent shall countersign, for the balance of such
Warrants.
The term "Expiration Date" shall mean 5:30 p.m. (New York time) on
________________, 1998. If each such date shall in the State of New York be a
holiday or a day on which the banks are authorized to close, then the
Expiration Date shall mean 5:30 p.m. (New York time) on the next following day
which in the State of New York is not a holiday or a day on which banks are
authorized to close.
The Company shall not be obligated to deliver any securities pursuant to
the exercise of this Warrant unless a registration statement under the
Securities Act of 1933, as amended (the "Act"), with respect to such securities
is effective or an exemption thereunder is available. The Company has
covenanted and agreed that it will file a registration statement under the
Federal securities laws, use its best efforts to cause the same to become
effective, use its best efforts to keep such registration statement current, if
required under the Act, while any of the Warrants are outstanding, and deliver
a prospectus which complies with Section
14
10(a)(3) of the Act to the Registered Holder exercising this Warrant. This
Warrant shall not be exercisable by a Registered Holder in any state where such
exercise would be unlawful.
This Warrant Certificate is exchangeable, upon the surrender hereof by the
Registered Holder at the corporate office of the Warrant Agent, for a new
Warrant Certificate or Warrant Certificates of like tenor representing an equal
aggregate number of Warrants, each of such new Warrant Certificates to
represent such number of Warrants as shall be designated by such Registered
Holder at the time of such surrender. Upon due presentment and payment of any
tax or other charge imposed in connection therewith or incident thereto, for
registration of transfer of this Warrant Certificate at such office, a new
Warrant Certificate or Warrant Certificates representing an equal aggregate
number of Warrants will be issued to the transferee in exchange therefor,
subject to the limitations provided in the Warrant Agreement.
Prior to the exercise of any Warrant represented hereby, the Registered
Holder shall not be entitled to any rights of a stockholder of the Company,
including, without limitation, the right to vote or to receive dividends or
other distributions, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided in the Warrant Agreement.
Under certain circumstances, the Representative may be entitled to receive
an aggregate of five percent (5%) of the Purchase Price of the Warrants
represented hereby.
Prior to due presentment for registration of transfer hereof, the Company
and the Warrant Agent may deem and treat the Registered Holder as the absolute
owner hereof and of each Warrant represented hereby (notwithstanding any
notations of ownership or writing hereon made by anyone other than a duly
authorized officer of the Company or the Warrant Agent) for all purposes and
shall not be affected by any notice to the contrary, except as provided in the
Warrant Agreement.
This Warrant Certificate shall be governed by and construed in accordance
with the laws of the State of Florida without giving effect to conflicts of
laws.
This Warrant Certificate is not valid unless countersigned by the Warrant
Agent.
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IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
duly executed, manually or in facsimile by two of its officers thereunto duly
authorized and a facsimile of its corporate seal to be imprinted hereon.
Dated:
2CONNECT EXPRESS, INC.
SEAL:
By:
-----------------------------
Name:
--------------------
Title:
-------------------
By:
-----------------------------
Name:
--------------------
Title: Secretary
COUNTERSIGNED:
AMERICAN STOCK TRANSFER & TRUST COMPANY,
as Warrant Agent
By:
-----------------------
Authorized Officer
Name:
------------------
Title:
-----------------
3
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SUBSCRIPTION FORM
To Be Executed by the Registered Holder
in Order to Exercise Warrants
The undersigned Registered Holder hereby irrevocably elects to exercise
_________ Warrants represented by this Warrant Certificate, and to purchase the
securities issuable upon the exercise of such Warrants, and requests that
certificates for such securities shall be issued in the name of:
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
(please print or type name and address)
and be delivered to
(please print or type name and address)
and if such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, that a new Warrant Certificate for the balance of such
Warrants be registered in the name of, and delivered to, the Registered Holder
at the address stated below.
IMPORTANT: PLEASE CIRCLE AND COMPLETE THE FOLLOWING, AS APPLICABLE:
1. The exercise of this Warrant was solicited by
Sterne, Agee & Xxxxx, Inc.,
as Representative.
2. The exercise of this Warrant was solicited by
.
----------------------------------------------
3. The exercise of this Warrant was not solicited.
Dated:
----------------------
Address
Social Security or Taxpayer
Identification Number
Signature Guaranteed
17
ASSIGNMENT
To Be Executed by the Registered Holder
in Order to Assign Warrants
FOR VALUE RECEIVED, __________________, hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER
(please print or type name and address)
________________ of the Warrants represented by this Warrant Certificate, and
hereby irrevocably constitutes and appoints ________________ Attorney to
transfer this Warrant Certificate on the books of the Company, with full power
of substitution in the premises.
Dated:
------------------------
------------------------
Signature Guaranteed
THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER AND MUST BE
GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS
AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED
SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15.
