Exhibit 4.2
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE HEREUNDER HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), IN RELIANCE ON EXEMPTIONS CONTAINED THEREIN OR
QUALIFIED OR REGISTERED UNDER ANY APPLICABLE STATE SECURITIES LAWS (THE
"STATE LAWS"). SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF EXCEPT IN A TRANSACTION (a) REGISTERED UNDER THE SECURITIES
ACT OR EXEMPT FROM REGISTRATION THEREUNDER AND QUALIFIED OR REGISTERED
UNDER THE STATE LAWS OR EXEMPT FROM QUALIFICATION OR REGISTRATION
THEREUNDER OR (b) OTHERWISE IN COMPLIANCE WITH THE SECURITIES ACT AND THE
STATE LAWS. THE OFFERING OF THIS WARRANT AND THE SHARES OF COMMON STOCK
ISSUABLE UPON EXERCISE HEREOF HAS NOT BEEN REVIEWED OR APPROVED BY ANY
STATE'S SECURITIES ADMINISTRATOR.
Xxxxxxx Xx. 0, Xxxxxxx, Xxxxxxx
WARRANT TO PURCHASE
SHARES OF COMMON STOCK
OF
R WIRELESS, INC.
July 21, 2005 Expires June 30, 2010
FOR VALUE RECEIVED, R Wireless, Inc., a Georgia corporation (together
with its successors and assigns, the "Company"), hereby certifies that Xxxxx,
Xxxxxxxx & Xxxxxx LLP or its registered assigns is entitled to subscribe for and
purchase, during the period specified in this Warrant, up to 1,434,088 shares
(subject to adjustment as hereinafter provided) of the duly authorized, validly
issued, fully paid and nonassessable Common Stock, at an exercise price per
share equal to the Warrant Price then in effect, subject, however, to the
provisions and upon the terms and conditions hereinafter set forth. Capitalized
terms used in this Warrant and not otherwise defined herein shall have the
respective meanings specified in Section 7 hereof.
SECTION 1. TERM.
The right to subscribe for and purchase shares of Warrant Stock
represented hereby shall commence on January 1, 2006 and shall expire at 5:00
p.m., Eastern Time time, on June 30, 2010 (such period being the "Term"). Prior
to the end of the Term, the Company will not take any action which would
terminate the Warrants.
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SECTION 2. EXERCISE, REGISTRATION, TRANSFER, EXCHANGE, COMPLIANCE WITH
SECURITIES LAWS AND CONTINUING RIGHTS.
2.1 RIGHT OF EXERCISE. The purchase rights represented by this Warrant
may be exercised in whole or in part at any time and from time to time during
the Term.
2.2 METHOD OF EXERCISE. The Holder hereof may exercise this Warrant, in
whole or in part, by the surrender of this Warrant (with the Subscription Form
attached hereto duly executed) at the principal office of the Company, and by
the payment to the Company of an amount of consideration equal to the Warrant
Price in effect on the date of such exercise multiplied by the number of shares
of Warrant Stock with respect to which this Warrant is then being exercised,
payable at such Holder's election by certified or official bank check or by
canceling Indebtedness to the extent of such exercise.
2.3 ISSUANCE OF STOCK CERTIFICATES. In the event of any exercise of the
rights represented by this Warrant in accordance with and subject to the terms
and conditions hereof, (a) certificates for the shares of Warrant Stock so
purchased shall be dated the date of such exercise and delivered to the Holder
hereof within a reasonable time, not exceeding five Trading Days after such
exercise, at the Company's expense, and the Holder hereof shall be deemed for
all purposes to be the Holder of the shares of Warrant Stock so purchased as of
the date of such exercise, and (b) unless this Warrant has expired, a new
Warrant representing the number of shares of Warrant Stock, if any, with respect
to which this Warrant shall not then have been exercised shall also be issued to
the Holder hereof at the Company's expense within such time.
2.4 WARRANT REGISTER. The Warrants shall be numbered and shall be
registered in a Warrant register (the "Warrant Register"). The Company shall be
entitled to treat the registered holder of any Warrant on the Warrant Register
as the owner in fact thereof for all purposes and shall not be bound to
recognize any equitable or other claim to or interest in such Warrant on the
part of any other Person, and shall not be liable for any registration of
transfer of Warrants which are registered or are to be registered in the name of
a fiduciary or the nominee of a fiduciary unless made with the actual knowledge
that a fiduciary or nominee is committing a breach of trust in requesting such
registration of transfer, or with such knowledge of such facts that its
participation therein amounts to bad faith. The Warrants shall be registered
initially in the name of the Holder as set forth in the first sentence of this
Warrant in such denominations as the Holder may request in writing to the
Company.
2.5 TRANSFER OF WARRANT. The Warrants will not be sold, transferred,
assigned or hypothecated, in part or in whole (other than to the individual
partners of Xxxxx, Xxxxxxxx & Xxxxxx LLP or by will or pursuant to the laws of
descent and distribution), except to registered assigns of the Holder and
thereafter only upon delivery thereof duly endorsed by the Holder or by his duly
authorized attorney or representative, or accompanied by proper evidence of
succession, assignment or authority to transfer. In all cases of transfer by an
attorney, the original power of attorney, duly approved, or an official copy
thereof, duly certified, shall be deposited with the Company. In case of
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transfer by executors, administrators, guardians or other legal representatives,
duly authenticated evidence of their authority shall be produced, and may be
required to be deposited with the Company in its discretion. Upon any
registration of transfer, the Company shall deliver a new Warrant or Warrants to
the persons entitled thereto. The Warrants may be exchanged at the option of the
Holder thereof for another Warrant, or other Warrants, of different
denominations, of like tenor and representing in the aggregate the right to
purchase a like number of shares of Common Stock upon surrender to the Company
or its duly authorized agent. Notwithstanding the foregoing, the Company shall
have no obligation to cause Warrants to be transferred on its books to any
person if such transfer would violate the Securities Act.
2.6 COMPLIANCE WITH SECURITIES LAWS.
(a) The holder of this Warrant, by acceptance hereof,
acknowledges that this Warrant and the Warrant Stock to be issued upon exercise
hereof are being acquired solely for the Holder's own account (which for the
initial Holder, Baker, Xxxxxxxx & Xxxxxx LLP, includes the account of each of
its partners, who are Xxxxx X. Xxxxx and J. Xxxxxx Xxxxxxxx, Xx. and, if he is
still a partner, Xxxxx X. Xxxxxx, Xx.) and not as a nominee for any other party,
and for investment, and that the Holder will not offer, sell or otherwise
dispose of this Warrant or any Warrant Stock except pursuant to an effective
registration statement, or an exemption from registration, under the Securities
Act and any applicable state securities laws.
(b) Except as provided in Section 2.6(c) below, this Warrant
and all certificates representing Warrant Stock issued upon exercise hereof
shall be stamped or imprinted with a legend in substantially the following form:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SCURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), IN
RELIANCE ON EXEMPTIONS CONTAINED THEREIN OR QUALIFIED OR REGISTERED UNDER
ANY APPLICABLE STATE SECURITIES LAWS (THE "STATE LAWS"). SUCH SECURITIES
MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN A
TRANSACTION (a) REGISTERED UNDER THE SECURITIES ACT OR EXEMPT FROM
REGISTRATION THEREUNDER AND QUALIFIED OR REGISTERED UNDER THE STATE LAWS
OR EXEMPT FROM QUALIFICATION OR REGISTRATION THEREUNDER, OR (b) OTHERWISE
IN COMPLIANCE WITH THE SECURITIES ACT AND THE STATE LAWS.
(c) The restrictions imposed by this Section 2.6 upon the
transfer of this Warrant and the shares of Warrant Stock to be purchased upon
exercise hereof shall terminate (i) when such securities shall have been
effectively registered under the Securities Act, (ii) upon the Company's receipt
of an opinion of counsel, in form and substance reasonably satisfactory to the
Company, addressed to the Company to the effect that such restrictions are no
longer required to ensure compliance with the Securities Act or (iii) upon the
Company's receipt of other evidence reasonably satisfactory to the Company that
such registration is not required. Whenever such restrictions shall terminate as
to any such securities, the Holder thereof shall be entitled to receive from the
Company (or its transfer agent and registrar), without expense (other than
applicable transfer taxes, if any), new Warrants (or, in the case of shares of
Warrant Stock, new stock certificates) of like tenor not bearing the applicable
legends required by Section 2.6(b) relating to the Securities Act and state
securities laws.
2.7 CONTINUING RIGHTS OF HOLDER. The Company will, at the time of, or
at any time after, each exercise of this Warrant, upon the request of the Holder
hereof or of any shares of Warrant Stock issued upon such exercise, acknowledge
in writing the extent, if any, of its continuing obligation to afford to such
Holder all rights to which such Holder shall continue to be entitled after such
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exercise in accordance with the terms of this Warrant, provided that if any such
Holder shall fail to make any such request, the failure shall not affect the
continuing obligation of the Company to afford such rights to such Holder.
SECTION 3. COVENANTS OF THE COMPANY.
3.1 STOCK FULLY PAID. The Company represents, warrants, covenants and
agrees that all shares of Warrant Stock which may be issued upon the exercise of
this Warrant or otherwise hereunder will, upon issuance, be duly authorized,
validly issued, fully paid and nonassessable and free from all taxes, liens and
charges created by or through the Company. The Company further covenants and
agrees that during the Term, the Company will at all times have authorized and
reserved for the purpose of the issue upon exercise of this Warrant a sufficient
number of shares of Common Stock to provide for the exercise of this Warrant.
3.2 PAYMENT OF TAXES. The Company will pay all documentary stamp taxes,
if any, attributable to the issuance of Warrant Stock; provided, however, that
the Company shall not be required to pay any tax or taxes which may be payable
in respect of any transfer involved in the issue or delivery of any certificates
for Warrant Stock in a name other than that of the Holder of Warrants in respect
of which such Warrant Stock is issued.
3.3 RESERVATION. If any shares of Common Stock required to be reserved
for issuance upon exercise of this Warrant or as otherwise provided hereunder
require registration or qualification with any governmental authority under any
federal or state law before such shares may be so issued, the Company will in
good faith use its best efforts as expeditiously as possible at its expense to
cause such shares to be duly registered or qualified. The transfer agent for the
Common Stock (the "Transfer Agent"), and every subsequent transfer agent, if
any, for the Warrant Stock will be irrevocably authorized and directed at all
times until the end of the Term to reserve such number of authorized and
unissued shares of Common Stock as shall be required for such purpose. The
Company will keep a copy of this Warrant on file with the Transfer Agent and
with every subsequent transfer agent for of the Company's securities issuable
upon the exercise of the Warrants. The Company will supply the Transfer Agent or
any subsequent transfer agent with duly executed certificates for such purpose
and will itself provide or otherwise make available any cash which may be
distributable as provided in Section 6 of this Warrant. All Warrants surrendered
in the exercise of the rights thereby evidenced shall be canceled, and such
canceled Warrants shall constitute sufficient evidence of the number of Shares
that have been issued upon the exercise of such Warrants. No shares of Common
Stock shall be subject to reservation in respect of unexercised Warrants
subsequent to the end of the Term. If the Company shall list any shares of
Common Stock on any securities exchange or market it will, at its expense, list
thereon, maintain and increase when necessary, such listing of all shares of
Warrant Stock from time to time issued upon exercise of this Warrant or as
otherwise provided hereunder, and, to the extent permissible under the
applicable securities exchange rules, all unissued shares of Warrant Stock which
are at any time issuable hereunder, so long as any shares of Common Stock shall
be so listed. The Company will also so list on each securities exchange or
market, and will maintain such listing of, any other securities which the Holder
of this Warrant shall be entitled to receive upon the exercise of this Warrant
if at the time any securities of the same class shall be listed on such
securities exchange or market by the Company.
-4-
3.4 DILUTION. The Company shall not by any action including, without
limitation, amending the Certificate of Incorporation or the Bylaws of the
Company, or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other action, avoid or
seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms
and in the taking of all such actions as may be necessary or appropriate to
protect the rights of the Holder hereof against dilution (to the extent
specifically provided herein) or impairment. Without limiting the generality of
the foregoing, the Company will (a) not amend or modify any provision of the
Certificate of Incorporation or Bylaws of the Company in any manner that would
adversely affect in any way the powers, preferences or relative participating,
optional or other special rights of the Common Stock or which would adversely
affect the rights of the Holders of the Warrants, (b) take all such action as
may be reasonably necessary in order that the Company may validly and legally
issue fully paid and nonassessable shares of Common Stock, free and clear of any
liens, claims, encumbrances and restrictions (other than as provided herein)
upon the exercise of this Warrant, and (c) use its best efforts to obtain all
such authorizations, exemptions or consents from any public regulatory body
having jurisdiction thereof as may be reasonably necessary to enable the Company
to perform its obligations under this Warrant.
3.5 LOSS, THEFT, DESTRUCTION OR MUTILATION OF WARRANTS. Upon receipt of
evidence satisfactory to the Company of the ownership of and the loss, theft,
destruction or mutilation of any Warrant and, in the case of any such loss,
theft or destruction, upon receipt of indemnity and/or security satisfactory to
the Company or, in the case of any such mutilation, upon surrender and
cancellation of such Warrant, the Company will make and deliver, in lieu of such
lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and
representing the right to purchase the same number of shares of Common Stock.
SECTION 4. ADJUSTMENT OF WARRANT PRICE AND WARRANT SHARE NUMBER.
The number and kind of Securities purchasable upon the exercise of this
Warrant and the Warrant Price shall be subject to adjustment from time to time
upon the happening of certain events as follows:
4.1 RECAPITALIZATION, REORGANIZATION, RECLASSIFICATION, CONSOLIDATION,
MERGER OR SALE.
(a) In case the Company after the Original Issue Date shall do
any of the following (each, a "Triggering Event"): (i) consolidate with or merge
into any other Person when the Company shall not be the continuing or surviving
corporation of such consolidation or merger, (ii) permit any other Person to
consolidate with or merge into the Company when the Company shall be the
continuing or surviving Person but, in connection with such consolidation or
merger, any Capital Stock of the Company shall be changed into or exchanged for
Securities of any other Person or cash or any other property, (iii) transfer all
or substantially all of its properties or assets to any other Person, or (iv)
effect a capital reorganization or reclassification of its Capital Stock, then,
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and in the case of each such Triggering Event, proper provision shall be made so
that, upon the basis and the terms and in the manner provided in this Warrant,
the Holder of this Warrant shall be entitled upon the exercise hereof at any
time after the consummation of such Triggering Event, to the extent this Warrant
is not exercised prior to such Triggering Event, to receive at the Warrant Price
in effect at the time immediately prior to the consummation of such Triggering
Event in lieu of the Common Stock issuable upon such exercise of this Warrant
prior to such Triggering Event, the Securities, cash and property to which such
Holder would have been entitled upon the consummation of such Triggering Event
if such Holder had exercised the rights represented by this Warrant immediately
prior thereto, subject to adjustments and increases (subsequent to such
corporate action) as nearly equivalent as possible to the adjustments provided
for in Section 4 hereof.
(b) Notwithstanding anything contained in this Warrant to the
contrary, the Company will not effect any Triggering Event unless, prior to the
consummation thereof, each Person (other than the Company) which may be required
to deliver any Securities, cash or property upon the exercise of this Warrant as
provided herein shall assume, by written instrument delivered to, and reasonably
satisfactory to, the Holder of this Warrant, (i) the obligations of the Company
under this Warrant (and if the Company shall survive the consummation of such
Triggering Event, such assumption shall be in addition to, and shall not release
the Company from, any continuing obligations of the Company under this Warrant)
and (ii) the obligation to deliver to such Holder such shares of Securities,
cash or property as, in accordance with the foregoing provisions of this Section
4.1, such Holder shall be entitled to receive, and such Person shall have
similarly delivered to such Holder an opinion of counsel for such Person, which
counsel shall be reasonably satisfactory to such Holder, stating that this
Warrant shall thereafter continue in full force and effect and the terms hereof
(including, without limitation, all of the provisions of this Section 4.1) shall
be applicable to the Securities, cash or property which such Person may be
required to deliver upon any exercise of this Warrant or the exercise of any
rights pursuant hereto.
4.2 SUBDIVISION OR COMBINATION OF SHARES. If the Company, at any time
while this Warrant is outstanding, shall subdivide or combine any shares of
Common Stock, (a) in case of subdivision of shares, the Warrant Price shall be
proportionately reduced (as at the effective date of such subdivision or, if the
Company shall take a record of Holders of its Common Stock for the purpose of so
subdividing, as at the applicable record date, whichever is earlier) to reflect
the increase in the total number of shares of Common Stock outstanding as a
result of such subdivision, or (b) in the case of a combination of shares, the
Warrant Price shall be proportionately increased (as at the effective date of
such combination or, if the Company shall take a record of Holders of its Common
Stock for the purpose of so combining, as at the applicable record date,
whichever is earlier) to reflect the reduction in the total number of shares of
Common Stock outstanding as a result of such combination.
4.3 STOCK DIVIDENDS AND DISTRIBUTIONS. If the Company, at any time
while this Warrant is outstanding, shall pay a dividend in, or make any other
distribution to its stockholders (without consideration therefor) of, shares of
Common Stock, the Warrant Price shall be adjusted, as at the date the Company
shall take a record of the Holders of the Company's Capital Stock for the
purpose of receiving such dividend or other distribution (or if no such record
is taken, as at the date of such payment or other distribution), to that price
determined by multiplying the Warrant Price in effect immediately prior to such
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record date (or if no such record is taken, then immediately prior to such
payment or other distribution), by a fraction (i) the numerator of which shall
be the total number of shares of Common Stock outstanding immediately prior to
such dividend or distribution, and (ii) the denominator of which shall be the
total number of shares of Common Stock outstanding immediately after such
dividend or distribution (plus if the Company paid cash for fractional shares,
the number of additional shares which would have been outstanding had the
Company issued fractional shares in connection with said dividends).
4.4 OTHER ACTION AFFECTING COMMON STOCK. In case after the Original
Issue Date the Company shall take any action affecting its Common Stock, other
than an action described in any of the foregoing Sections 4.1 through 4.3,
inclusive, and the failure to make any adjustment would not fairly protect the
purchase rights represented by this Warrant in accordance with the essential
intent and principle of this Section 4, then the Warrant Price shall be adjusted
in such manner and at such time as the Board may in good faith determine to be
equitable in the circumstances.
4.5 ADJUSTMENT OF WARRANT SHARE NUMBER. Upon each adjustment in the
Warrant Price pursuant to any of the foregoing provisions of this Section 4, the
Warrant Share Number shall be adjusted, to the nearest one hundredth of a whole
share, to the product obtained by multiplying the Warrant Share Number
immediately prior to such adjustment in the Warrant Price by a fraction, the
numerator of which shall be the Warrant Price immediately before giving effect
to such adjustment and the denominator of which shall be the Warrant Price
immediately after giving effect to such adjustment. If the Company shall be in
default under any provision contained in Section 3 of this Warrant so that
shares issued at the Warrant Price adjusted in accordance with this Section 4
would not be validly issued, the adjustment of the Warrant Share Number provided
for in the foregoing sentence shall nonetheless be made and the Holder of this
Warrant shall be entitled to purchase such greater number of shares at the
lowest price at which such shares may then be validly issued under applicable
law. Such exercise shall not constitute a waiver of any claim arising against
the Company by reason of its default under Section 3 of this Warrant.
4.6 FORM OF WARRANT AFTER ADJUSTMENTS. The form of this Warrant need
not be changed because of any adjustments in the Warrant Price or the number and
kind of Securities purchasable upon the exercise of this Warrant.
SECTION 5. NOTICE OF ADJUSTMENTS.
Whenever the Warrant Price or Warrant Share Number shall be adjusted
pursuant to Section 4 hereof (for purposes of this Section 5, each an
"adjustment"), the Company shall cause its Chief Financial Officer to prepare
and execute a certificate setting forth, in reasonable detail, the event
requiring the adjustment, the amount of the adjustment, the method by which such
adjustment was calculated (including a description of the basis on which the
Board made any determination hereunder), and the Warrant Price and Warrant Share
Number after giving effect to such adjustment, and shall cause copies of such
certificate to be delivered to the Holder of this Warrant promptly after each
adjustment. Any dispute between the Company and the Holder of this Warrant with
respect to the matters set forth in such certificate may at the option of the
Holder of this Warrant be submitted to an Independent Appraiser selected by the
Holder; provided that the Company shall have ten days after receipt of notice
from such Holder of its selection of such firm to object thereto, in which case
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such Holder shall select another Independent Appraiser and the Company shall
have no such right of objection. The firm selected by the Holder of this Warrant
as provided in the preceding sentence shall be instructed to deliver a written
opinion as to such matters to the Company and such Holder within 30 days after
submission to it of such dispute. Such opinion shall be final and binding on the
parties hereto. The fees and expenses of such Independent Appraiser shall be
paid by the Company, unless all the matters set forth in the certificate, as it
may have been amended prior to the submission to the Independent Appraiser, are
confirmed as proper by the Independent Appraiser, in which case the costs of the
Independent Appraiser will be paid by the Holder.
SECTION 6. FRACTIONAL SHARES.
No fractional shares of Warrant Stock will be issued in connection with
an exercise hereof, but in lieu of such fractional shares, the Company shall
make a cash payment therefor equal in amount to the product of the applicable
fraction multiplied by the Per Share Market Value then in effect.
SECTION 7. CALL.
The Company, at its option, may call up to one hundred percent (100%)
of this Warrant at any time and from time to time on or after February 1, 2006
if the Per Share Market Value of the Common Stock has been equal to or greater
than two and a half (2-1/2) times the Warrant Price for a period of twenty (20)
consecutive Trading Days (a "Call Notice Period") ending not more than five (5)
Trading Days prior to the date that the Call Notice is effective by providing
the Holder of this Warrant written notice pursuant to Section 11(d) (the "Call
Notice"). The rights and privileges granted pursuant to this Warrant with
respect to the Warrant Stock subject to the Call Notice (the "Called Warrant
Stock") shall expire at the end of the Call Notice Period (the "Early
Termination Date") if this Warrant is not exercised with respect to such Called
Warrant Stock prior to such Early Termination Date. In the event this Warrant is
not exercised with respect to the Called Warrant Stock, the Issuer shall remit
to the Holder of this Warrant (i) $.001 per share of Called Warrant Stock, and
(ii) a new Warrant representing the number of shares of Warrant Stock, if any,
which shall not have been subject to the Call Notice upon the Holder tendering
to the Issuer the applicable Warrant certificate.
SECTION 8. DEFINITIONS.
For the purposes of this Warrant, the following terms have the
following meanings:
"Board" means the Board of Directors of the Company.
"Capital Stock" means and includes (a) any and all shares, interests,
participations or other equivalents of or interests in (however designated)
corporate stock, including, without limitation, shares of preferred or
preference stock, (b) all partnership interests (whether general or limited) in
any Person which is a partnership, (c) all membership interests or limited
liability company interests in any limited liability company, and (d) all equity
or ownership interests in any Person of any other type.
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"Common Stock" means the common stock of the Company and any other
Capital Stock into which such stock may hereafter be changed.
"Company" means R Wireless, Inc., a Georgia corporation, and its
successors.
"Governmental Authority" means any governmental, regulatory or
self-regulatory entity, department, body, official, authority, commission,
board, agency or instrumentality, whether federal, state or local, and whether
domestic or foreign.
"Holders" mean the Persons who shall from time to time own any Warrant.
The term "Holder" means one of the Holders.
"Indebtedness" means indebtedness of the Company to Xxxxx, Xxxxxxxx &
Xxxxxx LLP in the amount of $215,113.20, as set forth on the books of the
Company on the date hereof after giving effect to the waiver of $.05 for
services by Xxxxx, Xxxxxxxx & Xxxxxx LLP.
"Independent Appraiser" means a nationally recognized or major regional
investment banking firm or firm of independent certified public accountants of
recognized standing (which may be the firm that regularly examines the financial
statements of the Company) that is regularly engaged in the business of
appraising the Capital Stock or assets of corporations or other entities as
going concerns, and which is not affiliated with either the Company or the
Holder of any Warrant.
"Majority Holders" means at any time the Holders of Warrants
exercisable for a majority of the shares of Warrant Stock issuable under the
Warrants at the time outstanding.
"NASDAQ" means the National Association of Securities Dealers Automated
Quotation System.
"Original Issue Date" means July 21, 2005.
"Other Common" means any other Capital Stock of the Company of any
class which shall be authorized at any time after the date of this Warrant
(other than Common Stock) and which shall have the right to participate in the
distribution of earnings and assets of the Company without limitation as to
amount.
"Person" means an individual, corporation, limited liability company,
partnership, joint stock company, trust, unincorporated organization, joint
venture, Governmental Authority or other entity of whatever nature.
"Per Share Market Value" means on any particular date (a) the closing
price per share of the Common Stock on such date on the Nasdaq National Market,
The Nasdaq SmallCap Market or other registered national stock exchange on which
the Common Stock is then listed or if there is no such price on such date, then
the closing price on such exchange or quotation system on the date nearest
preceding such date, or (b) if the Common Stock is not listed then on the Nasdaq
National Market, The Nasdaq SmallCap Market or any registered national stock
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exchange, the closing price for a share of Common Stock in the over-the-counter
market, as reported by NASDAQ or by the National Quotation Bureau, Inc. or
similar organization or agency succeeding to its functions of reporting prices)
at the close of business on such date, or (c) if the Common Stock is not then
publicly traded, the fair market value of a share of Common Stock as determined
by an Independent Appraiser selected in good faith by the Majority Holders;
provided, however, that the Company, after receipt of the determination by such
Independent Appraiser, shall have the right to select an additional Independent
Appraiser, in which case, the fair market value shall be equal to the average of
the determinations by each such Independent Appraiser; and provided, further
that all determinations of the Per Share Market Value shall be appropriately
adjusted for any stock dividends, stock splits or other similar transactions
during such period. The determination of fair market value by an Independent
Appraiser shall be based upon the fair market value of the Company determined on
a going concern basis as between a willing buyer and a willing seller and taking
into account all relevant factors determinative of value, and shall be final and
binding on all parties. In determining the fair market value of any shares of
Common Stock, no consideration shall be given to any restrictions on transfer of
the Common Stock imposed by agreement or by federal or state securities laws, or
to the existence or absence of, or any limitations on, voting rights.
"Securities" means any debt or equity securities of the Company,
whether now or hereafter authorized, any instrument convertible into or
exchangeable for Securities or a Security, and any option, warrant or other
right to purchase or acquire any Security. "Security" means one of the
Securities.
"Securities Act" means the Securities Act of 1933, as amended, or any
similar federal statute then in effect.
"Subsidiary" means any corporation at least 50% of whose outstanding
Voting Stock shall at the time be owned directly or indirectly by the Company or
by one or more of its Subsidiaries, or by the Company and one or more of its
Subsidiaries.
"Trading Day" means (a) a day on which the Common Stock is traded on
the Nasdaq National Market, The Nasdaq SmallCap Market or other registered
national stock exchange on which the Common Stock has been listed, or (b) if the
Common Stock is not listed on the Nasdaq National Market, The Nasdaq SmallCap
Market or any registered national stock exchange, a day or which the Common
Stock is traded in the over-the-counter market, as reported by the OTC Bulletin
Board, or (c) if the Common Stock is not quoted on the OTC Bulletin Board, a day
on which the Common Stock is quoted in the over-the-counter market as reported
by the National Quotation Bureau Incorporated (or any similar organization or
agency succeeding its functions of reporting prices); provided, however, that if
the Common Stock is not listed or quoted as set forth in (a), (b) and (c)
hereof, then Trading Day shall mean any day except Saturday, Sunday and any day
which shall be a legal holiday or a day on which banking institutions in the
State of New York are authorized or required by law or other government action
to close.
"Term" has the meaning specified in Section 1 hereof.
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"Voting Stock", as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) having ordinary
voting power for the election of a majority of the members of the Board of
Directors (or other governing body) of such corporation, other than Capital
Stock having such power only by reason of the happening of a contingency.
"Warrants" means this Warrant and any other Warrants of like tenor
issued in substitution or exchange for any thereof pursuant to the provisions of
Sections 2.3, 2.4 or 2.5 hereof or of any of such other Warrants.
"Warrant Price" means $0.15, as such price may be adjusted from time to
time from the adjustments specified in Section 4 hereof.
"Warrant Share Number" means at any time the aggregate number of shares
of Warrant Stock which may at such time be purchased upon exercise of this
Warrant, after giving effect to all prior adjustments and increases to such
number made or required to be made under the terms hereof.
"Warrant Stock" means Common Stock issuable upon exercise of any
Warrant or Warrants or otherwise issuable pursuant to any Warrant or Warrants.
SECTION 9. OTHER NOTICES.
In case at any time: (a) the Company shall make any dividends or other
distributions to the holders of Common Stock; or (b) the Company shall authorize
the granting to all holders of its Common Stock of rights to subscribe for or
purchase any shares of Capital Stock of any class or of any Common Stock
Equivalents or Convertible Securities or other rights; or (c) there shall be any
reclassification of the Capital Stock of the Company; or (d) there shall be any
capital reorganization by the Company; or (e) there shall be any (i)
consolidation or merger involving the Company or (ii) sale, transfer or other
disposition of all or substantially all of the Company's property, assets or
business (except a merger or other reorganization in which the Company shall be
the surviving corporation and its shares of Capital Stock shall continue to be
outstanding and unchanged and except a consolidation, merger, sale, transfer or
other disposition involving a wholly-owned Subsidiary); or (f) there shall be a
voluntary or involuntary dissolution, liquidation or winding-up of the Company
or any partial liquidation of the Company or distribution to holders of Common
Stock; then, in each of such cases, the Company shall give written notice to the
Holder of the date on which (A) the books of the Company shall close or a record
shall be taken for such distribution or subscription rights or (B) such
reclassification, reorganization, consolidation, merger, disposition,
dissolution, liquidation or winding-up, as the case may be, shall take place.
Such notice also shall specify the date as of which the holders of Common Stock
of record shall participate in such distribution or subscription rights, or
shall be entitled to exchange their certificates for Common Stock for securities
or other property deliverable upon such reclassification, reorganization,
consolidation, merger, disposition, dissolution, liquidation or winding-up, as
the case may be. Such notice shall be given at least twenty days prior to the
action in question and not less than twenty days prior to the record date or the
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date on which the Company's transfer books are closed in respect thereto. The
Company shall give to the Holder notice of all meetings and actions by written
consent of its stockholders, at the same time in the same manner as notice of
any meetings of stockholders is required to be given to stockholders who do not
waive such notice (or, if such requires no notice, then two Trading Days written
notice thereof describing the matters upon which action is to be taken). The
Holder shall have the right to send two representatives selected by it to each
meeting, who shall be permitted to attend, but not vote at, such meeting and any
adjournments thereof. This Warrant entitles the Holder to receive copies of all
financial and other information distributed or required to be distributed to the
holders of the Common Stock.
SECTION 10. WARRANT AGENT.
The Company may, by written notice to each Holder of this Warrant,
appoint an agent having an office in the United States of America for the
purpose of issuing shares of Warrant Stock on the exercise of this Warrant
pursuant to Section 2.2 hereof, exchanging this Warrant pursuant to Section 2.5
hereof or replacing this Warrant pursuant to Section 3.4 hereof, or any of the
foregoing, and thereafter any such issuance, exchange or replacement, as the
case may be, shall be made at such office by such agent.
SECTION 11. MISCELLANEOUS.
(a) GOVERNING LAW. This Warrant shall be governed by and construed
according to the laws of the State of Georgia applicable to contracts made by
residents of such state, and wholly to be performed, within such state.
(b) ENTIRE AGREEMENT. This Warrant constitutes the entire agreement and
understanding between the parties hereto and supersedes any prior or
contemporaneous written or oral agreements between them respecting the subject
matter hereof.
(c) AMENDMENT AND WAIVER. Any term, covenant, agreement or condition in
this Warrant may be amended, or compliance therewith may be waived (either
generally or in a particular instance and either retroactively or
prospectively), by a written instrument or written instruments executed by the
Company and the Holder of this Warrant.
(d) NOTICES. Any notice required or permitted to be given hereunder or
pursuant to law shall be validly given, made or served if in writing and shall
be effective (i) immediately if delivered in person or by facsimile or email
with evidence of receipt, (ii) in three days after being sent by first class
certified or registered mail, postage prepaid, or (iii) one day after being sent
by nationally recognized overnight delivery service with evidence of receipt.
Delivery to the Holder shall be made to the Holder's address, as reflected in
the Warrant Register or as otherwise notified from time to time by the Holder to
the Company for such purpose, or to the facsimile number or email address as the
Holder may from time to time notify the Company for such purpose. Delivery to
the Company shall be made to the Company's principal office as set forth by the
Company in its most recent filing with the Securities and Exchange Commission or
as the Company may from time to time notify the Holder for such purpose, or as
to facsimile number or email address as the Company may notify the Holder from
time to time for such purpose.
(e) SUCCESSORS AND ASSIGNS. This Warrant and the rights evidenced
hereby shall inure to the benefit of and be binding upon the successors and
assigns of the Company, the Holder hereof and the Holders of Warrant Stock
issued pursuant hereto.
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(f) REMEDIES. The Company stipulates that the remedies at law of the
Holder of this Warrant in the event of any default or threatened default by the
Company in the performance of or compliance with any of the terms of this
Warrant are not and will not be adequate and that, to the fullest extent
permitted by law, such terms may be specifically enforced by a decree for the
specific performance of any agreement contained herein or by an injunction
against a violation of any of the terms hereof or otherwise.
(g) CONSTRUCTION. The headings and captions of this Warrant are
provided for convenience and general reference only and shall not be construed
to describe, define or limit the scope or intent of the provisions hereof. No
provision of this document is to be interpreted for or against either party
hereto by reason of the fact that such party or its legal counsel drafted it.
IN WITNESS WHEREOF, the Company has executed this Warrant as of the day
and year first above written.
R WIRELESS, INC.
By: /S/ Xxxx Xxxxxxx
------------------------------------
Xxxx Xxxxxxx
Chairman and Chief Executive Officer
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SUBSCRIPTION FORM
(To be signed only upon exercise of Warrant)
To R Wireless, Inc.:
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, _________ shares of Common Stock of R Wireless, Inc. and
herewith (a) makes payment of $________ therefore by certified or official bank
check or (b) applies $_____ of Indebtedness therefor. The undersigned requests
that the certificates for such shares be issued in the name of________________
_________________________________________, and delivered to, __________________,
whose address is _________________________________________________________.
Dated the ____ day of __________, 20__.
________________________________
Signature
Print Name: ________________________________
Address: ________________________________
________________________________
________________________________
Phone: ________________________________
(Signature must conform to name of Holder as specified on the face of the
Warrant)
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ASSIGNMENT
(To be signed only upon transfer of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
all of the rights of the undersigned under the within Warrant, with respect to
the number of shares of Common Stock of R Wireless, Inc. covered thereby set
forth hereinbelow unto:
NAME OF ASSIGNEE ADDRESS NUMBER OF SHARES
---------------- ------- ----------------
To the extent that the within Warrant covers shares not so assigned and
transferred, please return a balance certificate to the undersigned at the
address indicated below.
Dated the ____ day of __________, 20__.
________________________________
Signature
Print Name: ________________________________
Address: ________________________________
________________________________
________________________________
Phone: ________________________________
(Signature must conform to name of Holder as specified on the face of the
Warrant)
Witnessed By:
________________________________
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