Contract
Ex-4.4
Agreement
made as
of
, 2005 between Fortress America Acquisition Corporation, a Delaware
corporation, with offices at 0 Xxxxxxxx Xxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx, XX
00000 (“Company”), and Continental Stock Transfer & Trust Company, a New
York corporation, with offices at 00 Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000
(“Warrant Agent”).
WHEREAS,
the Company is engaged in a public offering (“Public Offering”) of Units
(“Units”) and, in connection therewith, has determined to issue and deliver up
to (i) 16,100,000 Warrants (“Public Warrants”) to the public investors, and (ii)
1,400,000 Warrants to Sunrise Securities Corp. (“Sunrise”) or its designees
(“Representative's Warrants” and, together with the Public Warrants, the
“Warrants”), evidencing the right of the holder thereof to purchase one share of
common stock, par value $.0001 per share, of the Company’s Common Stock (“Common
Stock”) for $5.00 in the case of the Public Warrants, and for $6.25 in the case
of the Representative’s Warrants, subject to adjustment as described herein;
and
WHEREAS,
the Company has filed with the Securities and Exchange Commission a Registration
Statement, No. 333-_____ on Form S-1 (“Registration Statement”) for the
registration, under the Securities Act of 1933, as amended (“Act”) of, among
other securities, the Warrants and the Common Stock issuable upon exercise of
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, redemption and exercise of the Warrants;
and
WHEREAS,
the Company desires to provide for the form and provisions of the Warrants, the
terms upon which they shall be issued and exercised, and the respective rights,
limitation of rights, and immunities of the Company, the Warrant Agent, and the
holders of the Warrants; and
WHEREAS,
all acts and things have been done and performed which are necessary to make the
Warrants, when executed on behalf of the Company and countersigned by or on
behalf of the Warrant Agent, as provided herein, the valid, binding and legal
obligations of the Company, and to authorize the execution and delivery of this
Agreement.
NOW,
THEREFORE, in consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
1. Appointment
of Warrant Agent. The
Company hereby appoints the Warrant Agent to act as agent for the
Company for the Warrants, and the Warrant Agent hereby accepts
such appointment and agrees to perform the same in accordance with the terms and
conditions set forth in this Agreement.
2. Warrants.
2.1 Form
of Warrant. Each
Warrant shall be issued in registered form only, shall be in substantially the
form of Exhibit A hereto, the provisions of which are incorporated herein and
shall be signed by, or bear the facsimile signature of, the Chairman of the
Board or President and Treasurer, Secretary or Assistant Secretary of the
Company and shall bear a facsimile of the Company’s seal. In the event the
person whose facsimile signature has been placed upon any Warrant shall have
ceased to serve in the capacity in which such person signed the Warrant before
such Warrant is issued, it may be issued with the same effect as if he or she
had not ceased to be such at the date of issuance.
2.2 Effect
of Countersignature. Unless
and until countersigned by the Warrant Agent pursuant to this Agreement, a
Warrant shall be invalid and of no effect and may not be exercised by the holder
thereof.
2.3 Registration.
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2.3.1 Warrant
Register. The
Warrant Agent shall maintain books (“Warrant Register”), for the registration of
original issuance and the registration of transfer of the Warrants. Upon the
initial issuance of the Warrants, the Warrant Agent shall issue and register the
Warrants in the names of the respective holders thereof in such denominations
and otherwise in accordance with instructions delivered to the Warrant Agent by
the Company.
2.3.2 Registered
Holder. Prior
to due presentment for registration of transfer of any Warrant, the Company and
the Warrant Agent may deem and treat the person in whose name such Warrant shall
be registered upon the Warrant Register (“registered holder”), as the absolute
owner of such Warrant and of each Warrant represented thereby (notwithstanding
any notation of ownership or other writing on the Warrant Certificate made by
anyone other than the Company or the Warrant Agent), for the purpose of any
exercise thereof, and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary.
2.4 Detachability
of Warrants. The
securities comprising the Units will not be separately transferable until 90
days after the date hereof unless Sunrise Securities Corp. (“Sunrise”) informs
the Company of its decision to allow earlier separate trading, but in no event
will Sunrise allow separate trading of the securities comprising the Units until
the Company files a Current Report on Form 8-K which includes an audited balance
sheet reflecting the receipt by the Company of the gross proceeds of the Public
Offering including the proceeds received by the Company from the exercise of the
Underwriter’s over-allotment option, if the over-allotment option is exercised
prior to the filing of the Form 8-K.
2.5 Warrants
and Representative's Warrants. The
Representative's Warrants shall have the same terms and be in the same form as
the Public Warrants except with respect to the Warrant Price as set forth below
in Section 3.1.
3. Terms
and Exercise of Warrants.
3.1 Warrant
Price. Each
Public Warrant shall, when countersigned by the Warrant Agent, entitle the
registered holder thereof, subject to the provisions of such Public Warrant and
of this Warrant Agreement, to purchase from the Company the number of shares of
Common Stock stated therein, at the price of $5.00 per whole share, subject to
the adjustments provided in Section 4 hereof and in the last sentence of
this Section 3.1. Each Representative’s Warrant shall, when countersigned
by the Warrant Agent, entitle the registered holder thereof, subject to the
provisions of such Representative's Warrant and of this Warrant Agreement, to
purchase from the Company the number of shares of Common Stock stated therein,
at the price of $6.25 per whole share, subject to the adjustments provided in
Section 4 hereof and in the last sentence of this Section 3.1. The term
“Warrant Price” as used in this Warrant Agreement refers to the price per share
at which Common Stock may be purchased at the time a Warrant is exercised. The
Company in its sole discretion may lower the Warrant Price at any time prior to
the Expiration Date.
3.2 Duration
of Warrants. A
Warrant may be exercised only during the period (“Exercise Period”) commencing
on the later of the consummation by the Company of a merger, capital stock
exchange, asset acquisition or other similar business combination (“Business
Combination”) (as described more fully in the Company’s Registration Statement)
or ,
2006 and terminating at 5:00 p.m., New York City time on the earlier to occur of
(i) ,
2009, (ii) the date fixed for redemption of the Warrants as provided in
Section 6 of this Agreement (“Expiration Date”). Except with respect to the
right to receive the Redemption Price (as set forth in Section 6
hereunder), each Warrant not exercised on or before the Expiration Date shall
become void, and all rights thereunder and all rights in respect thereof under
this Agreement shall cease at the close of business on the Expiration Date. The
Company in its sole discretion may extend the duration of the Warrants by
delaying the Expiration Date.
3.3 Exercise
of Warrants.
3.3.1 Payment.
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(a) Subject
to the provisions of the Warrant and this Warrant Agreement, a Warrant, when
countersigned by the Warrant Agent, may be exercised by the registered holder
thereof by surrendering it, at the office of the Warrant Agent, or at the office
of its successor as Warrant Agent, in the Borough of Manhattan, City and State
of New York, with the exercise form, as set forth in the Warrant, duly executed,
and by paying in full, in lawful money of the United States, in cash, good
certified check or good bank draft payable to the order of the Company (or as
otherwise agreed to by the Company), the Warrant Price for each full share of
Common Stock as to which the Warrant is exercised and any and all applicable
taxes due in connection with the exercise of the Warrant, the exchange of the
Warrant for the Common Stock, and the issuance of the Common Stock.
(b) In lieu
of the payment of the Warrant Price in cash, the registered holder of the
Warrant shall have the right (but not the obligation), during the Exercise
Period, to require the Company to convert any exercisable but unexercised
portion of the Warrant (the “Conversion Right”), in whole or in part, into the
shares of Common Stock as provided for in this subsection (the “Net Exercise
Shares”). Upon exercise of the Conversion Right, the Company shall deliver to
the registered holder thereof (without payment in cash of the Warrant Price)
that number of Net Exercise Shares equal to (i) the number of shares of Common
Stock issuable upon exercise of the portion of the Warrant being converted,
multiplied by (ii) the quotient obtained by dividing (x) the value of the
Warrant (on a per share basis) at the time the Conversion Right is exercised
(determined by subtracting the Warrant Price (as adjusted) from the Current
Market Price (as defined below), for the shares of Common Stock issuable upon
exercise of the Warrant immediately prior to the exercise of the Conversion
Right) by (y) the Current Market Price of one share of Common Stock for the 10
trading days ending on the third business day prior to the date of notice of
exercise of the Conversion Right is sent to the Company, or in the event the
Company has called the Warrants for redemption pursuant to Section 6 hereof, the
Current Market Price of one share of Common Stock for the 10 trading days ending
on the third business day prior to the date on which the notice of redemption is
sent to holders of Warrant pursuant to Section 6 hereof. The Conversion Right
may be exercised by surrendering the Warrant at the office of the Warrant Agent,
or at the office of its successor as Warrant Agent, in the Borough of Manhattan,
City and State of New York, with the duly executed exercise form, as set forth
in the Warrant, with the cashless exercise section completed, exercising the
Conversion Right and specifying the total number of shares of Common Stock the
holder thereof will purchase pursuant to such Conversion Right. The presentation
and surrender shall be deemed a waiver of the holder’s obligation to pay all or
any portion of the aggregate Warrant Price payable for the shares of Common
Stock being issued upon such exercise of the Warrant. The Warrant (or so much
thereof as shall have been surrendered for conversion) shall be deemed to have
been converted immediately prior to the close of business on the day of
surrender of the Warrant for conversion in accordance with the foregoing
provisions.
(c) The
“Current Market Price” of a share of Common Stock shall mean (i) if the Common
Stock is listed on a national securities exchange or quoted on the Nasdaq
National Market, Nasdaq SmallCap Market or NASD OTC Bulletin Board (or successor
trading market), the last sale price of the Common Stock in the principal
trading market for the Common Stock as reported by the exchange, Nasdaq or the
NASD, as the case may be; (ii) if the Common Stock is not listed on a national
securities exchange or quoted on the Nasdaq National Market, Nasdaq SmallCap
Market or the NASD OTC Bulletin Board (or successor trading market), but is
traded in the residual over-the-counter market, the closing bid price for the
Common Stock on the last trading day preceding the date in question for which
such quotations are reported by the Pink Sheets, LLC or similar publisher of
such quotations; and (iii) if the fair market value of the Common Stock cannot
be determined pursuant to clause (i) or (ii) above, such price as the Board of
Directors of the Company shall determine, in good faith.
3.3.2 Issuance
of Certificates. As soon
as practicable after the exercise of any Warrant and the clearance of the funds
in payment of any Warrant Price, the Company shall issue to the registered
holder of such Warrant a certificate or certificates for the number of full
shares of Common Stock to which he is entitled, registered in such name or names
as may be directed by him, her or it, and if such Warrant shall not have been
exercised in full, a new countersigned Warrant for the number of shares as to
which such Warrant shall not have been exercised. Notwithstanding the foregoing,
the Company shall not be obligated to deliver any securities pursuant to the
exercise of a Warrant unless (i) a registration statement under the Act with
respect to the Common Stock is effective or (ii) in the opinion of counsel to
the Company, the exercise of the Warrants is exempt from the registration
requirements of the Act and such securities are qualified for sale or exempt
from qualification under applicable securities laws of the states or other
jurisdictions in which the registered holders reside. Warrants may not be
exercised by, or securities issued to, any registered holder in any state in
which such exercise would be unlawful.
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3.3.3 Valid
Issuance. All
shares of Common Stock issued upon the proper exercise of a Warrant in
conformity with this Agreement shall be validly issued, fully paid and
nonassessable.
3.3.4 Date
of Issuance. Each
person in whose name any such certificate for shares of Common Stock is issued
shall for all purposes be deemed to have become the holder of record of such
shares on the date on which the Warrant was surrendered for exercise and payment
of any Warrant Price was made, irrespective of the date of delivery of such
certificate, except that, if the date of such surrender and any payment is a
date when the stock transfer books of the Company are closed, such person shall
be deemed to have become the holder of such shares at the close of business on
the next succeeding date on which the stock transfer books are
open.
3.3.5 Warrant
Solicitation and Warrant Solicitation Fee.
(a) The
Company has engaged Sunrise, on a non-exclusive basis, as its agent for the
solicitation of the exercise of the Warrants. The Company, at its cost, will (i)
assist Sunrise with respect to such solicitation, if requested by Sunrise, and
(ii) provide Sunrise, and direct the Company’s transfer agent and the Warrant
Agent to deliver to Sunrise, lists of the record and, to the extent known,
beneficial owners of the Company’s Warrants. The Company hereby instructs the
Warrant Agent to cooperate with Sunrise in every respect in connection with
Sunrise’s solicitation activities, including, but not limited to, providing to
Sunrise, at the Company’s cost, a list of record and beneficial holders of the
Warrants and circulating a prospectus or offering circular disclosing the
compensation arrangements referenced in Section 3.3.5(b) below to holders
of the Warrants at the time of exercise of the Warrants. In addition to the
conditions set forth in Section 3.3.5(b), Sunrise shall accept payment of
the warrant solicitation fee provided in Section 3.3.5(b) only if it has
provided bona fide services to the Company in connection with the exercise of
the Warrants and only to the extent that an investor who exercises his Warrants
specifically designates, in writing, that Sunrise solicited his exercise. In
addition to soliciting, either orally or in writing, the exercise of Warrants by
a Warrant holder, such services may also include disseminating information,
either orally or in writing, to Warrant holders about the Company or the market
for the Company’s securities, or assisting in the processing of the exercise of
Warrants.
(b) In each
instance in which a Warrant is exercised, the Warrant Agent shall promptly give
written notice of such exercise to the Company and Sunrise (“Warrant Agent’s
Exercise Notice”). If, upon the exercise of any Warrant more than one year from
the effective date of the Registration Statement, (i) the market price of
the Company’s Common Stock is greater than the Warrant Price, (ii) disclosure of
compensation arrangements between the Company and Sunrise with respect to the
solicitation of the exercise of the Warrants was made both at the time of the
Public Offering and at the time of exercise (by delivery of the Prospectus or as
otherwise required by applicable law, rule or regulation), (iii) the holder of
the Warrant confirms in writing that the exercise of the Warrant was solicited
by Sunrise, (iv) the Warrant was not held in a discretionary account, and (v)
the solicitation of the exercise of the Warrant was not in violation of
Regulation M (as such rule or any successor rule may be in effect as of such
time of exercise) promulgated under the Securities Exchange Act of 1934, as
amended, then the Warrant Agent, simultaneously with the distribution of the
Common Stock underlying the Warrants so exercised in accordance with the
instructions from the Company following receipt of the proceeds to the Company
received upon exercise of such Warrant(s), shall, on behalf of the Company, pay
(A) in the case of a cash exercise of the Warrant, a fee of 5% of the Warrant
Price to Sunrise, or (B) in the case of exercise of the Warrant pursuant to a
Conversion Right without the payment of cash, a fee of .05 shares for each
warrant exercised; provided that Sunrise delivers to the Warrant Agent within
ten (10) business days from the date on which Sunrise has received the Warrant
Agent’s Exercise Notice, a certificate that the conditions set forth in
the preceding clauses (iii), (iv) and (v) have been satisfied. Notwithstanding
the foregoing, no fee will be paid to Sunrise with respect to the exercise by
the Underwriters or their affiliates or the Company’s officers or directors of
Warrants purchased by it or them and still held by them for its or their own
account. Sunrise and the Company may at any time during business hours, examine
the records of the Warrant Agent, including its ledger of original Warrant
certificates returned to the Warrant Agent upon exercise of Warrants.
(c) The
provisions of this Section 3.3.5. may not be modified, amended or deleted
without the prior written consent of Sunrise.
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4. Adjustments.
4.1 Stock
Dividends - Split-Ups. If
after the date hereof, and subject to the provisions of Section 4.6 below,
the number of outstanding shares of Common Stock is increased by a stock
dividend payable in shares of Common Stock, or by a split-up of shares of Common
Stock, or other similar event, then, on the effective date of such stock
dividend, split-up or similar event, the number of shares of Common Stock
issuable on exercise of each Warrant shall be increased in proportion to such
increase in outstanding shares of Common Stock.
4.2 Aggregation
of Shares. If
after the date hereof, and subject to the provisions of Section 4.6, the
number of outstanding shares of Common Stock is decreased by a consolidation,
combination, reverse stock split or reclassification of shares of Common Stock
or other similar event, then, on the effective date of such consolidation,
combination, reverse stock split, reclassification or similar event, the number
of shares of Common Stock issuable on exercise of each Warrant shall be
decreased in proportion to such decrease in outstanding shares of Common
Stock.
4.3 Adjustments
in Exercise Price.
Whenever the number of shares of Common Stock purchasable upon the exercise of
the Warrants is adjusted, as provided in Section 4.1 and 4.2 above, the
Warrant Price shall be adjusted (to the nearest cent) by multiplying such
Warrant Price immediately prior to such adjustment by a fraction (x) the
numerator of which shall be the number of shares of Common Stock purchasable
upon the exercise of the Warrants immediately prior to such adjustment, and (y)
the denominator of which shall be the number of shares of Common Stock so
purchasable immediately thereafter.
4.4 Replacement
of Securities upon Reorganization, etc. In case
of any reclassification or reorganization of the outstanding shares of Common
Stock (other than a change covered by Section 4.1 or 4.2 hereof or that
solely affects the par value of such shares of Common Stock), or in the case of
any merger or consolidation of the Company with or into another corporation
(other than a consolidation or merger in which the Company is the continuing
corporation and that does not result in any reclassification or reorganization
of the outstanding shares of Common Stock), or in the case of any sale or
conveyance to another corporation or entity of the assets or other property of
the Company as an entirety or substantially as an entirety in connection with
which the Company is dissolved, the Warrant holders shall thereafter have the
right to purchase and receive, upon the basis and upon the terms and conditions
specified in the Warrants and in lieu of the shares of Common Stock of the
Company immediately theretofore purchasable and receivable upon the exercise of
the rights represented thereby, the kind and amount of shares of stock or other
securities or property (including cash) receivable upon such reclassification,
reorganization, merger or consolidation, or upon a dissolution following any
such sale or transfer, that the Warrant holder would have received if such
Warrant holder had exercised his, her or its Warrant(s) immediately prior to
such event; and if any reclassification also results in a change in shares of
Common Stock covered by Section 4.1 or 4.2, then such adjustment shall be
made pursuant to Sections 4.1, 4.2, 4.3 and this Section 4.4. The
provisions of this Section 4.4 shall similarly apply to successive
reclassifications, reorganizations, mergers or consolidations, sales or other
transfers.
4.5 Notices
of Changes in Warrant. Upon
every adjustment of the Warrant Price or the number of shares issuable upon
exercise of a Warrant, the Company shall give written notice thereof to the
Warrant Agent, which notice shall state the Warrant Price resulting from such
adjustment and the increase or decrease, if any, in the number of shares
purchasable at such price upon the exercise of a Warrant, setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based. Upon the occurrence of any event specified in Sections
4.1, 4.2, 4.3 or 4.4, then, in any such event, the Company shall give written
notice to the Warrant holder, at the last address set forth for such holder in
the warrant register, of the record date or the effective date of the event.
Failure to give such notice, or any defect therein, shall not affect the
legality or validity of such event.
4.6 No
Fractional Shares.
Notwithstanding any provision contained in this Warrant Agreement to the
contrary, the Company shall not issue fractional shares upon exercise of
Warrants. If, by reason of any adjustment made pursuant to this Section 4,
the holder of any Warrant would be entitled, upon the exercise of such Warrant,
to receive a fractional interest in a share, the Company shall, upon such
exercise, round up to the nearest whole number the number of the shares of
Common Stock to be issued to the Warrant holder.
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4.7 Form
of Warrant. The
form of Warrant need not be changed because of any adjustment pursuant to this
Section 4, and Warrants issued after such adjustment may state the same
Warrant Price and the same number of shares as is stated in the Warrants
initially issued pursuant to this Agreement. However, the Company may at any
time in its sole discretion make any change in the form of Warrant that the
Company may deem appropriate and that does not affect the substance thereof, and
any Warrant thereafter issued or countersigned, whether in exchange or
substitution for an outstanding Warrant or otherwise, may be in the form as so
changed.
5. Transfer
and Exchange of Warrants.
5.1 Registration
of Transfer. The
Warrant Agent shall register the transfer, from time to time, of any outstanding
Warrant upon the Warrant Register, upon surrender of such Warrant for transfer,
properly endorsed with signatures properly guaranteed and accompanied by
appropriate instructions for transfer. Upon any such transfer, a new Warrant
representing an equal aggregate number of Warrants shall be issued and the old
Warrant shall be cancelled by the Warrant Agent. The Warrants so cancelled shall
be delivered by the Warrant Agent to the Company from time to time upon
request.
5.2 Procedure
for Surrender of Warrants.
Warrants may be surrendered to the Warrant Agent, together with a written
request for exchange or transfer, and thereupon the Warrant Agent shall issue in
exchange therefor one or more new Warrants as requested by the registered holder
of the Warrants so surrendered, representing an equal aggregate number of
Warrants; provided, however, that in the event that a Warrant surrendered for
transfer bears a restrictive legend, the Warrant Agent shall not cancel such
Warrant and issue new Warrants in exchange therefor until the Warrant Agent has
received an opinion of counsel for the Company stating that such transfer may be
made and indicating whether the new Warrants must also bear a restrictive
legend.
5.3 Fractional
Warrants. The
Warrant Agent shall not be required to effect any registration of transfer or
exchange which will result in the issuance of a warrant certificate for a
fraction of a warrant.
5.4 Service
Charges. No
service charge shall be made for any exchange or registration of transfer of
Warrants.
5.5 Warrant
Execution and Countersignature. The
Warrant Agent is hereby authorized to countersign and to deliver, in accordance
with the terms of this Agreement, the Warrants required to be issued pursuant to
the provisions of this Section 5, and the Company, whenever required by the
Warrant Agent, will supply the Warrant Agent with Warrants duly executed on
behalf of the Company for such purpose.
6. Redemption.
6.1 Redemption. Subject
to Section 6.4 hereof, not less than all of the outstanding Warrants may be
redeemed, at the option of the Company with the prior consent of Sunrise, at any
time after they become exercisable and prior to their expiration, at the office
of the Warrant Agent, upon the notice referred to in Section 6.2., at the
price of $.01 per Warrant (“Redemption Price”), provided that the last sales
price of the Common Stock has been at least $8.50 per share, on each of twenty
(20) trading days within any thirty (30) trading day period ending on the third
business day prior to the date on which notice of redemption is given and the
weekly trading volume for the Common Stock has been at least 200,000 shares for
each of the two calendar weeks before the notice of redemption is given. The
provisions of this Section 6.1 may not be modified, amended or deleted
without the prior written consent of Sunrise.
6.2 Date
Fixed for, and Notice of, Redemption. In the
event the Company shall elect to redeem all of the Warrants, the Company shall
fix a date for the redemption. Notice of redemption shall be mailed by first
class mail, postage prepaid, by the Company not less than 30 days prior to the
date fixed for redemption to the registered holders of the Warrants to be
redeemed at their last addresses as they shall appear on the registration books.
Any notice mailed in the manner herein provided shall be conclusively presumed
to have been duly given whether or not the registered holder received such
notice.
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6.3 Exercise
After Notice of Redemption. The
Warrants may be exercised in accordance with Section 3 of this Agreement at
any time after notice of redemption shall have been given by the Company
pursuant to Section 6.2. hereof and prior to the time and date fixed for
redemption. On and after the redemption date, the record holder of the Warrants
shall have no further rights except to receive, upon surrender of the Warrants,
the Redemption Price.
6.4 Outstanding
Warrants Only. The
Company understands that the redemption rights provided for by this
Section 6 apply only to outstanding Warrants. To the extent a person holds
rights to purchase Warrants, such purchase rights shall not be extinguished by
redemption. However, once such purchase rights are exercised, the Company may
redeem the Warrants issued upon such exercise provided that the criteria for
redemption is met. The provisions of this Section 6.4 may not be modified,
amended or deleted without the prior written consent of Sunrise.
7. Other
Provisions Relating to Rights of Holders of Warrants.
7.1 No
Rights as Stockholder. A
Warrant does not entitle the registered holder thereof to any of the rights of a
stockholder of the Company, including, without limitation, the right to receive
dividends, or other distributions, exercise any preemptive rights to vote or to
consent or to receive notice as stockholders in respect of the meetings of
stockholders or the election of directors of the Company or any other
matter.
7.2 Lost,
Stolen, Mutilated, or Destroyed Warrants. If any
Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant
Agent may on such terms as to indemnity or otherwise as they may in their
discretion impose (which shall, in the case of a mutilated Warrant, include the
surrender thereof), issue a new Warrant of like denomination, tenor, and date as
the Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant shall
constitute a substitute contractual obligation of the Company, whether or not
the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time
enforceable by anyone.
7.3 Reservation
of Common Stock. The
Company shall at all times reserve and keep available a number of its authorized
but unissued shares of Common Stock that will be sufficient to permit the
exercise in full of all outstanding Warrants issued pursuant to this
Agreement.
7.4 Registration
of Common Stock. The
Company agrees that prior to the commencement of the Exercise Period, it shall
file with the Securities and Exchange Commission a post-effective amendment to
the Registration Statement, or a new registration statement, for the
registration, under the Act, of, and it shall take such action as is necessary
to qualify for sale, in those states in which the Warrants were initially
offered by the Company, the Common Stock issuable upon exercise of the Warrants.
In either case, the Company will use its best efforts to cause the same to
become effective and to maintain the effectiveness of such registration
statement until the expiration of the Warrants in accordance with the provisions
of this Agreement. The provisions of this Section 7.4 may not be modified,
amended or deleted without the prior written consent of Sunrise.
8. Concerning
the Warrant Agent and Other Matters.
8.1 Payment
of Taxes. The
Company will from time to time promptly pay all taxes and charges that may be
imposed upon the Company or the Warrant Agent in respect of the issuance or
delivery of shares of Common Stock upon the exercise of Warrants, but the
Company shall not be obligated to pay any transfer taxes in respect of the
Warrants or such shares.
8.2 Resignation,
Consolidation, or Merger of Warrant Agent.
8.2.1 Appointment
of Successor Warrant Agent. The
Warrant Agent, or any successor to it hereafter appointed, may resign its duties
and be discharged from all further duties and liabilities hereunder after giving
sixty (60) days’ notice in writing to the Company. If the office of the Warrant
Agent becomes vacant by resignation or incapacity to act or otherwise, the
Company shall appoint in writing a successor Warrant Agent in place of the
Warrant Agent. If the Company shall fail to make such appointment within a
period of 30 days after it has been notified in writing of such resignation or
incapacity by the Warrant Agent or by the holder of the Warrant (who shall, with
such notice, submit his Warrant for inspection by the Company), then the holder
of any Warrant may apply to the Supreme Court of the State of New York for the
County of New York for the appointment of a successor Warrant Agent at the
Company’s cost. Any successor Warrant Agent, whether appointed by the Company or
by such court, shall be a corporation organized and existing under the laws of
the State of New York, in good standing and having its principal office in the
Borough of Manhattan, City and State of New York, and authorized under such laws
to exercise corporate trust powers and subject to supervision or examination by
federal or state authority. After appointment, any successor Warrant Agent shall
be vested with all the authority, powers, rights, immunities, duties, and
obligations of its predecessor Warrant Agent with like effect as if originally
named as Warrant Agent hereunder, without any further act or deed; but if for
any reason it becomes necessary or appropriate, the predecessor Warrant Agent
shall execute and deliver, at the expense of the Company, an instrument
transferring to such successor Warrant Agent all the authority, powers, and
rights of such predecessor Warrant Agent hereunder; and upon request of any
successor Warrant Agent the Company shall make, execute, acknowledge, and
deliver any and all instruments in writing for more fully and effectually
vesting in and confirming to such successor Warrant Agent all such authority,
powers, rights, immunities, duties, and obligations.
7
8.2.2 Notice
of Successor Warrant Agent. In the
event a successor Warrant Agent shall be appointed, the Company shall give
notice thereof to the predecessor Warrant Agent and the transfer agent for the
Common Stock not later than the effective date of any such
appointment.
8.2.3 Merger
or Consolidation of Warrant Agent. Any
corporation into which the Warrant Agent may be merged or with which it may be
consolidated or any corporation resulting from any merger or consolidation to
which the Warrant Agent shall be a party shall be the successor Warrant Agent
under this Agreement without any further act.
8.3 Fees
and Expenses of Warrant Agent.
8.3.1 Remuneration. The
Company agrees to pay the Warrant Agent reasonable remuneration for its services
as such Warrant Agent hereunder and will reimburse the Warrant Agent upon demand
for all expenditures that the Warrant Agent may reasonably incur in the
execution of its duties hereunder.
8.3.2 Further
Assurances. The
Company agrees to perform, execute, acknowledge, and deliver or cause to be
performed, executed, acknowledged, and delivered all such further and other
acts, instruments, and assurances as may reasonably be required by the Warrant
Agent for the carrying out or performing of the provisions of this
Agreement.
8.4 Liability
of Warrant Agent.
8.4.1 Reliance
on Company Statement.
Whenever in the performance of its duties under this Warrant Agreement, the
Warrant Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a statement signed by the President or Chairman of the Board of
the Company and delivered to the Warrant Agent. The Warrant Agent may rely upon
such statement for any action taken or suffered in good faith by it pursuant to
the provisions of this Agreement.
8.4.2 Indemnity. The
Warrant Agent shall be liable hereunder only for its own negligence, willful
misconduct or bad faith. The Company agrees to indemnify the Warrant Agent and
save it harmless against any and all liabilities, including judgments, costs and
reasonable counsel fees, for anything done or omitted by the Warrant Agent in
the execution of this Agreement except as a result of the Warrant Agent’s
negligence, willful misconduct, or bad faith.
8.4.3 Exclusions. The
Warrant Agent shall have no responsibility with respect to the validity of this
Agreement or with respect to the validity or execution of any Warrant (except
its countersignature thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement or in any
Warrant; nor shall it be responsible to make any adjustments required under the
provisions of Section 4 hereof or responsible for the manner, method, or
amount of any such adjustment or the ascertaining of the existence of facts that
would require any such adjustment; nor shall it by any act hereunder be deemed
to make any representation or warranty as to the authorization or reservation of
any shares of Common Stock to be issued pursuant to this Agreement or any
Warrant or as to whether any shares of Common Stock will when issued be valid
and fully paid and nonassessable.
8
8.5 Acceptance
of Agency. The
Warrant Agent hereby accepts the agency established by this Agreement and agrees
to perform the same upon the terms and conditions herein set forth and among
other things, shall account promptly to the Company with respect to Warrants
exercised and concurrently account for, and pay to the Company, all moneys
received by the Warrant Agent for the purchase of shares of the Company’s Common
Stock through the exercise of Warrants.
9. Miscellaneous
Provisions.
9.1 Successors. All the
covenants and provisions of this Agreement by or for the benefit of the Company
or the Warrant Agent shall bind and inure to the benefit of their respective
successors and assigns.
9.2 Notices. Any
notice, statement or demand authorized by this Warrant Agreement to be given or
made by the Warrant Agent or by the holder of any Warrant to or on the Company
shall be sufficiently given when so delivered if by hand or overnight delivery
or if sent by certified mail or private courier service within five days after
deposit of such notice, postage prepaid, addressed (until another address is
filed in writing by the Company with the Warrant Agent), as
follows:
0
Xxxxxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx,
XX 00000
Attn: C.
Xxxxxx XxXxxxxx, Chairman
Any
notice, statement or demand authorized by this Agreement to be given or made by
the holder of any Warrant or by the Company to or on the Warrant Agent shall be
sufficiently given when so delivered if by hand or overnight delivery or if sent
by certified mail or private courier service within five days after deposit of
such notice, postage prepaid, addressed (until another address is filed in
writing by the Warrant Agent with the Company), as follows:
Continental
Stock Transfer & Trust Company
00
Xxxxxxx Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attn:
Compliance Department
with a
copy in each case to:
Squire,
Xxxxxxx & Xxxxxxx L.L.P.
0000
Xxxxxx Xxxxxxxx Xxxxx, 00xx
Xxxxxx
Xxxxxx, XX 00000
Attn:
Xxxxx X. Xxxxxxx, Esq.
and
Mintz,
Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
000 Xxxxx
Xxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxxx X. Xxxx, Esq.
and
9
Sunrise
Securities Corp.
000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxx Low
9.3 Applicable
law. The
validity, interpretation, and performance of this Agreement and of the Warrants
shall be governed in all respects by the laws of the State of New York, without
giving effect to conflict of laws. The Company hereby agrees that any action,
proceeding or claim against it arising out of or relating in any way to this
Agreement shall be brought and enforced in the courts of the State of New York
or the United States District Court for the Southern District of New York, and
irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive.
The Company hereby waives any objection to such exclusive jurisdiction and that
such courts represent an inconvenience forum. Any such process or summons to be
served upon the Company may be served by transmitting a copy thereof by
registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in Section 9.2 hereof. Such
mailing shall be deemed personal service and shall be legal and binding upon the
Company in any action, proceeding or claim.
9.4 Persons
Having Rights under this Agreement. Nothing
in this Agreement expressed and nothing that may be implied from any of the
provisions hereof is intended, or shall be construed, to confer upon, or give
to, any person or corporation other than the parties hereto and the registered
holders of the Warrants and, for the purposes of Sections 3.3.5, 6.1, 6.4,
7.4 and 9.2 hereof, Sunrise, any right, remedy, or claim under or by reason of
this Warrant Agreement or of any covenant, condition, stipulation, promise, or
agreement hereof. Sunrise shall be deemed to be a third-party beneficiary of
this Agreement with respect to Sections 3.3.5, 6.1, 6.4, 7.4 and 9.2 hereof. All
covenants, conditions, stipulations, promises, and agreements contained in this
Warrant Agreement shall be for the sole and exclusive benefit of the parties
hereto (and Sunrise with respect to the Sections 3.3.5, 6.1, 6.4, 7.4 and 9.2
hereof) and their successors and assigns and of the registered holders of the
Warrants.
9.5 Examination
of the Warrant Agreement. A copy
of this Agreement shall be available at all reasonable times at the office of
the Warrant Agent in the Borough of Manhattan, City and State of New York, for
inspection by the registered holder of any Warrant. The Warrant Agent may
require any such holder to submit his Warrant for inspection by it.
9.6 Counterparts. This
Agreement may be executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same
instrument.
9.7 Effect
of Headings. The
Section headings herein are for convenience only and are not part of this
Warrant Agreement and shall not affect the interpretation thereof.
NYC
309853v3
10
IN
WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as
of the day and year first above written.
|
Attest
___________________________________ |
By:
___________________________________
Name: C.
Xxxxxx XxXxxxxx
Title: Chairman |
|
Attest
___________________________________
|
CONTINENTAL
STOCK TRANSFER & TRUST COMPANY
By:__________________________________________
Name: Xxxxxx
Xxxxxx
Title: Chairman |
11
