Exhibit 2
WARRANT
THIS WARRANT AND THE COMMON STOCK WHICH MAY BE ACQUIRED UPON EXERCISE OF THIS
WARRANT ("THE UNDERLYING COMMON STOCK") HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 OR UNDER ANY APPLICABLE STATE LAW. THIS WARRANT AND THE
UNDERLYING COMMON STOCK MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
PLEDGED WITHOUT (1) REGISTRATION UNDER THE SECURITIES ACT OF 1933 AND ANY
APPLICABLE STATE LAW, OR (2) AN OPINION OF COUNSEL SATISFACTORY TO TRADESTAR
SERVICES, INC. THAT REGISTRATION IS NOT REQUIRED.
Frontier Staffing, Inc.
Common Stock Purchase Warrant
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THIS IS TO CERTIFY THAT, for value received, Xxxxxxx Xxxxxxx, as registered
holder hereof, or any subsequent holder or holders (the "Holder"), upon due
exercise of this warrant (the "Warrant"), dated as of August 1, 2005, is
entitled to purchase from Frontier Staffing, Inc., a Nevada corporation (the
"Corporation"), and any Surviving Corporation (as defined below), all or any
part of the Warrant Shares (as hereinafter defined) for the applicable exercise
price in accordance with the terms provided below.
1. Exercise Period; Exercise Price; Warrant Shares. This Warrant shall be
exercisable prior to 5:00 p.m. Houston, Texas, time on July 31, 2009 (the
"Termination Date") only as follows:
a. Calculation of Warrants. The number of fully paid and
non-assessable shares of the Corporation or the Surviving Corporation's
common stock ("Successor Stock"), as the case may be, is equal to 10% of
the original principal amount of the Secured Promissory Note purchased by
the initial Holder (i.e., $50,000.00 X 10% = 5,000 shares, at the exercise
price of $.30 per share. The exercise price shall be thirty cents ($0.30)
per share for each share of Corporation or Successor Stock acquired, as the
case may be, subject to adjustment pursuant to Section 5 below.
b. "Warrant Shares" means the number of fully paid and non-assessable
shares of Successor Stock or Corporation Stock, as applicable, issuable
upon exercise of this Warrant in accordance with its terms.
c. "Exercise Price" means the cash exercise price per share to acquire
Warrant Shares, or the Corporation Stock, during the Exercise Period, as
applicable, in accordance with terms of this Warrant.
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2. Exercise of Warrant.
a. Procedure for Exercise. The Holder of this Warrant may exercise
this Warrant at any time immediately prior to expiration date for the
purchase of all or any part of the Warrant Shares. The purchase price shall
be equal to the Exercise Price multiplied by the number of Warrant Shares
to be acquired pursuant to such exercise of the Warrant. To exercise this
Warrant in whole or in part, the Holder hereof shall deliver to the
Corporation (i) a written Notice of Exercise of such Xxxxxx's election to
exercise this Warrant, which notice shall specify the number of whole
shares of Successor Stock to be purchased, (ii) payment of the aggregate
Exercise Price for the shares of Successor Stock being purchased in the
manner provided herein, (iii) an executed Investor Representation Letter,
and (iv) this Warrant. Upon receipt of the notice of exercise, the payment,
the executed Investor Representation Letter and surrender of this Warrant,
the Corporation shall, as promptly as practicable, execute or cause to be
executed and deliver to such Holder a certificate or certificates
representing the aggregate number of shares of Successor Stock specified in
such notice. The stock certificate or certificates so delivered shall be in
such denominations as may be specified in such notice and shall be
registered in the name of such Holder or, subject to the conditions of
Section 3 below, such other name as shall be designated in such notice.
Payment of the Exercise Price may be made by wire transfer, by certified
check or cashier's check, or by Xxxxxx's personal check, payable to the
order of the Corporation, or by wire transfer.
b. No Fractional Shares. No fractional shares of Successor Stock are
to be issued upon the exercise of this Warrant. If this Warrant shall have
been exercised only in part, the Corporation shall, at the time of delivery
of such certificate or certificates, deliver to such Holder a new warrant
evidencing the rights of such Holder to purchase the remaining shares of
Successor Stock called for by this Warrant, which new warrant shall in all
other respects be identical with this Warrant, or, at the request of such
Holder, appropriate notation may be made on this Warrant and the same
returned to such Holder.
c. Expenses. The Corporation shall pay all expenses, taxes and other
charges payable in connection with the preparation, execution and delivery
of stock certificates under this Section, except that, in case such stock
certificates are to be registered in a name or names other than the name of
the Holder of this Warrant, all stock transfer taxes payable upon the
execution and delivery of such stock certificate or certificates shall be
paid by the Holder hereof at the time of delivering the notice of exercise
mentioned above. In such case, the Holder hereof shall deliver with such
notice of exercise evidence, satisfactory to the Corporation, that such
taxes have been paid.
d. Warrant Holder Not a Stockholder. No Holder of this Warrant shall
be entitled, solely by reason of being a Holder hereof, to possess any
right or privilege as a stockholder of the Corporation or the Surviving
Corporation, including without limitation, the right to vote or receive
dividends or be deemed for any purpose the holder of Common Stock or the
Successor Stock or of any other securities of the Corporation which may at
any time be issuable on the exercise hereof, until the Holder shall have
exercised all or any part of this Warrant in accordance with the provisions
set forth in Section 2 hereof. Nothing contained herein shall be construed
to confer upon the Holder, as such, any of the rights of a stockholder of
the Corporation or any right to vote upon any matter submitted to
stockholders at any time thereof, or to give or withhold consent to any
corporate action (whether upon any recapitalization, issue of stock,
reclassification of stock, change of par value, consolidation, merger,
conveyance, or otherwise) or, to receive notice of the meetings, until the
Warrant shall have been exercised as provided in Section 2 hereof.
3. Transfer, Division and Combination.
a. Transfer of Warrants. The Warrant is a separate and detachable
security, transferable only on the books of the Corporation by the
registered Holder hereof in person or by attorney duly authorized in
writing, upon surrender of this Warrant to the Corporation for transfer.
Upon any such transfer, a new Warrant to purchase a like number of Shares
will be issued to the transferee or transferees in exchange for this
Warrant. Upon receipt by the Corporation of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant, and, in case of loss, theft or destruction, of an agreement of
indemnity (without security therefore, and upon surrender and cancellation
of this Warrant, if mutilated), the Corporation will make and deliver a new
Warrant of like tenor, in lieu of this Warrant. This Warrant shall be
promptly canceled by the Corporation upon the surrender hereof in
connection with any exchange, transfer or replacement.
b. Division and Combination of Warrants. This Warrant may, subject to
Section 4 hereof, be divided or combined with other warrants upon
presentation hereof at the principal office of the Corporation, together
with a written notice specifying the names and denominations in which new
warrants are to be issued signed by the Holder or his agent or attorney.
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Subject to compliance with the preceding paragraph and with Section 4, as
to any transfer which may be involved in such division or combination, the
Corporation shall execute and deliver a new warrant or warrants in exchange
for the warrant or warrants to be divided or combined in accordance with
such notice.
c. Expenses. The Corporation shall pay all expenses, taxes (other than
stock transfer taxes) and other charges payable in connection with the
preparation, execution and delivery of this Warrant pursuant to this
Section.
4. Compliance with Securities Act; Restrictions on Transfer.
a. Compliance with Securities Act. This Warrant and the related
Warrant Shares shall not be transferable except upon the conditions
specified in this Section, which conditions are intended, among other
things, to ensure compliance with the provisions of the Securities Act of
1933, as amended (the "Securities Act") or any applicable state securities
laws in respect of the transfer of such Warrant or Warrant Shares.
b. Restrictions on Transfer. By acceptance of this Warrant, the Holder
of this Warrant agrees, prior to any transfer or attempted transfer of such
Warrant or the related Warrant Shares, to give written notice to the
Corporation of such Xxxxxx's intention to affect such transfer. The notice
shall describe the manner and circumstances of the proposed transfer in
detail and shall contain an undertaking by the Holder to furnish such other
information as may be required to enable the Corporation's counsel to
render the opinions referred to below, and shall give the identity and
address of the Holder's counsel. By acceptance of this Warrant, the Holder
agrees to bear the reasonable expense of the Corporation's counsel for
delivery of all additional opinions requested by the Holder, if any
(whether such opinions would permit the proposed transfer or not). The
Holder shall submit a copy of the notice to the counsel designated in the
notice and the Corporation shall submit a copy thereof to its counsel, and
the following provisions shall apply:
(1) If, in the opinion of both the Corporation's and the Holder's
counsel, the proposed transfer of the Warrant or Warrant Shares may be
effected without registration of the Warrant or Warrant Shares under
the Securities Act, the Corporation shall, as promptly as practicable,
so notify the Holder who will then be entitled to transfer the Warrant
or Warrant Shares in accordance with the terms of the notice delivered
by the Holder to the Corporation.
(2) If, in the opinion of either the Corporation's or the
Holder's counsel, the proposed transfer of the Warrant or Warrant
Shares may not be effected without registration of the Warrant or
Warrant Shares under the Securities Act, the Corporation shall, as
promptly as practicable, so notify the Holder, and the Corporation
shall not be obligated to effect the proposed transfer, except
pursuant to an offering registered under the Securities Act.
c. Legend. Each certificate for Warrant Shares issued upon exercise of
this Warrant shall bear a legend to the effect that the Warrant Shares may
not be transferred except upon compliance with the provisions of this
Section 4, and each certificate for Warrant Shares transferred pursuant to
Section 4 shall also bear the legend listed below, unless, in the opinion
of counsel acceptable to the Corporation, such a legend is not required.
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES ACT OF ANY STATE. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES, AND SUCH SECURITIES MAY
NOT BE SOLD OR TRANSFERRED FOR VALUE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
OF THEM UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND/OR APPLICABLE STATE
SECURITIES ACTS OR AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION THAT
SUCH REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR ACTS.
d. Certain Covenants, Representations and Warranties of Holder.
(1) Investment Purposes. The Holder is acquiring the Warrant for
investment purposes and not with a view to the resale or distribution of
all or any part thereof. The Holder acknowledges that neither the Warrant
nor the underlying Warrant Shares have been registered under the Securities
Act, or the securities or "blue sky" laws of any state or other domestic or
foreign jurisdiction, and that none of such securities may be sold,
transferred or otherwise disposed of except pursuant to an effective
registration statement there under or an applicable exemption there from.
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(2) Accredited Investor. The Holder (i) has such knowledge and
experience in financial and business matters that such Xxxxxx is capable of
evaluating the merits and risks of his or her investment in the Warrant and
the underlying Warrant Shares and has the financial ability to assume the
monetary risk associated therewith; (ii) is able to bear the complete loss
of his or her investment in the Warrant and the underlying Warrant Shares;
has received such documents and information from the Corporation as such
Holder has requested and has had the opportunity to ask questions of and
receive answers from the Corporation and the terms and conditions of the
offering of the notes and to obtain additional information; (iv) is an
"accredited investor" as defined in Rule 501(a) of Regulation D promulgated
under the Securities Act; and (v) is not relying upon any statements or
instruments made or issued by any person other than the Corporation in
making a decision to invest in the Note.
(3) The Holder, if an individual, is not less than twenty-one years of
age;
(4) The Holder, either alone or with his Purchaser Representative, if
any, named below has such knowledge and experience in financial and
business matters that he is capable of evaluating the merits and risks of
an investment in the Corporation, and, if a resident of a certain state,
meets any additional suitability standards applicable to him under state
law;
(5) If the Holder is utilizing a Purchaser Representative for this
investment:
(a) Such Purchaser Representative, if any, named at the beginning
of this Agreement. has acted as his "Purchaser Representative" as
defined in Regulation D under the Securities Act of 1933, as amended
(the "1933 Act);
(b) The Holder has relied upon the advice of such Purchaser
Representative as to the merits of an investment in the Corporation
and the suitability of such investment for the undersigned; and
(c) Such Purchaser Representative has heretofore confirmed to the
Holder in writing (a true and correct copy of which is furnished to
the Corporation herewith) during the course of this transaction any
past, present or future material relationship, actual or contemplated,
between the Purchaser Representative and/or its affiliates and the
Corporation and/or any of its affiliates, and any compensation
received or to he received as a result thereof;
(d) If the Holder is a partnership, corporation, trust or other
entity:
(i) It was not formed for the purpose of this Investment;
(ii) It is authorized and otherwise duly qualified to
Purchase and hold Shares; and
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(iii) This Warrant has been duly and validly authorized And
executed and, when delivered, will constitute The legal, valid,
binding and enforceable obligation Of the undersigned;
(e) if the Holder is subject to the Employee Retirement Income
Security Act of 1974, as amended ("ER.ISA"), to the best of the
Holder's knowledge, neither the Corporation nor any affiliate of the
Corporation is a party in interest or disqualified person, as defined
in ERISA Section 3(14) and the Internal Revenue Code of 1954, as
amended, section 4975(e)(2), respectively, with respect to such plan;
(f) Holder is not subject to a statutory disqualification, as set
forth in Section 3(a)(39) of the 1934 Act;
(g) Xxxxxx undersigned and his Purchaser Representative, if any,
have been given full and complete access to all information with
respect to the Corporation and the Corporation's proposed activities
that the undersigned and his Purchaser Representative, if any, have
deemed necessary to evaluate the merits and risks of an investment in
the Corporation;
(h) Xxxxxx and, if applicable, his Purchaser Representative, have
had a full opportunity to ask questions of and to receive satisfactory
answers from a representative of the Corporation concerning the terms
and conditions of this investment and all such questions have been
answered to the full satisfaction of the undersigned;
(i) Xxxxxx and, if applicable, his Purchaser Representative, have
had the opportunity to receive documents related to the Corporation
and to ask questions of and receive answers from the Corporation
regarding the Corporation, its business and the terms and conditions
of the Warrant and have read carefully copies of the Corporation's SEC
Filings, including the exhibits hereto, if any, and the undersigned is
familiar with and agrees to all the terms and conditions of the
Warrant;
(j) Holder is aware of the risks associated with an investment in
the Corporation, including those described in the "Risk Factors"
section of the Corporation's SEC Filings, if any;
(k) Xxxxxx has adequate means of providing for his current needs
and possible personal contingencies, has no need for liquidity with
respect to his investment in the Corporation, and has financial
resources sufficient to bear the economic risk of such investment;
(1) Holder has been advised and understands that an investment in
the Corporation is highly speculative and has received no
representations or warranties from the Corporation with respect to
such investment;
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(m) Holder acknowledges that there are substantial restrictions
on the transferability of, and there will be no public market for, the
shares of Common Stock issuable upon exercise of the Warrants (the
"Warrant Shares") and, accordingly, it may not be possible for the
undersigned to liquidate his investment in case of an emergency or
otherwise, and the undersigned has been advised that while Rule 144 of
the 1933 Act is presently applicable to the Warrant Shares, the
undersigned understands that Rule 144 may not be available in the
future to such shares;
(n) Xxxxxx is aware that no securities administrator of any state
or federal government has made or will make any finding or
determination relating to this investment;
(o) Warrant Shares and the Warrants subscribed for hereby are
being purchased for the undersigned's own account (or a trust account
if the undersigned is a trustee), for investment purposes only and are
not being purchased with a view to or for any resale,
fractionalization, subdivision or distribution of such Warrant Shares;
and,
(p) All information which the Holder and his Purchaser
Representative, if any, has provided to the Corporation, including
(but not limited to) the information, representations and warranties
of the undersigned contained in the Purchaser Suitability Statement
executed by the undersigned and submitted to the Corporation in
connection with this Warrant, is true and correct in all material
respects as of the date set forth below and the undersigned agrees to
furnish any additional information which the Corporation may request
so as to determine the suitability of the undersigned, and to notify
the Corporation immediately should any material changes in such
information occur.
e. Certain Covenants, Representations and Warranties of the
Corporation. The Corporation hereby represents and warrants to the
undersigned, as of the date hereof, as follows:
(1) Organization and Qualification. The Corporation is duly
organized, validly existing and in good standing under the laws of the
State of Nevada and has all requisite corporate power and authority to
own and lease its properties, to carry on its business as presently
conducted and as proposed to be conducted and to consummate the
transactions contemplated hereby. The Corporation is duly qualified as
a foreign corporation and in good standing to do business in each
jurisdiction in which the nature of the business conducted or the
property owned by it requires such qualification, except where the
failure to be so qualified would not, individually or in the
aggregate, have a material adverse effect on the business, assets,
liabilities (contingent or otherwise), operations, condition
(financial or otherwise), or prospects of the Corporation (a
"Corporation Material Adverse Effect").
(2) Capitalization. (a) The authorized capital stock of the
Corporation as of the Corporation consists of 50,000,000 shares of
Common Stock, of which 10,950,000 shares are issued and outstanding,
and of which -0- shares are reserved for issuance upon exercise of
outstanding options and 200,000 shares are reserved for issuance upon
exercise of outstanding warrants and (b) 1,000,000 shares of preferred
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stock of which -0- shares of Series A preferred stock are outstanding,
-0- shares of Series B preferred stock are outstanding and -0- shares
of Series C preferred stock are issued and outstanding. (c) As of the
date hereof, the Corporation has reserved a sufficient number of
shares of Common Stock for issuance upon exercise of the Warrants. (d)
The Shares, when issued against payment therefore in accordance with
this Agreement will be duly and validly issued, fully paid and
non-assessable, and the Warrants, when issued against payment
therefore in accordance with this Agreement, will be duly and validly
issued. The shares of Common Stock issuable upon exercise of the
Warrants, (the "Warrant Shares"), will be duly and validly issued,
fully paid and non-assessable.
(3) Authorization of Transaction Documents. The Corporation has
full corporate power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. The execution,
delivery and performance by the Corporation of this Agreement shall be
duly authorized by all requisite corporate action by the Corporation
and this Agreement will be the valid and binding obligations of the
Corporation, enforceable against the Corporation in accordance with
their respective terms, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization or similar laws affecting the
rights of creditors generally and subject to general principles of
equity.
(4) No Violations. The execution, delivery and performance by the
Corporation of this Agreement and the compliance with the provisions
hereof by the Corporation do not and will not violate, conflict with
or constitute or result in a breach of or default under (or an event
which with notice or passage of time or both would constitute a
default) or give rise to any right of termination, cancellation or
acceleration under, or result in the creation of any Encumbrance (as
defined below) upon any properties or assets of the Corporation under
(a) the Articles of Incorporation or bylaws of the Corporation, (b)
any applicable law, statute, rule or regulation, or any ruling, writ,
injunction, order, judgment or decree of any court, arbitrator,
administrative agency or other governmental body applicable to the
Corporation or any of its properties or assets or (c) any contract,
indenture, mortgage, deed of trust, lease, agreement or other
instrument, to which the Corporation is a party or by which the
Corporation or any of its property is bound, except, in each case,
where such violation, conflict, breach, default, termination,
cancellation, acceleration or Encumbrance would not, individually or
in the aggregate, have a Corporation Material Adverse Effect. As used
herein, the term "Encumbrance" shall mean any material lien, charge,
encumbrance, claim, option, proxy, pledge, security interest, or other
similar right of any nature other than statutory liens securing
payments not yet due and payable or due but not yet delinquent.
(5) Absence of Certain Events. Since July 6, 2005, (a) the
Corporation has not (i) varied its business plan or practices, in any
material respect, from past practices, (ii) entered into any
financing, joint venture, license or similar arrangement that would
limit or restrict its ability to perform its obligations hereunder or
(iii) suffered or permitted to be incurred any liability or obligation
or any Encumbrance against any of its properties or assets that would
limit or restrict its ability to perform its obligations hereunder;
and (b) there has not been any change or development which has had, or
could reasonably be expected to have, a Corporation Material Adverse
Effect.
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(6) Intellectual Property. The Corporation owns or possesses
sufficient legal rights to use pursuant to license, sublicense,
agreement or permission all Intellectual Property used in the
operation of its business as presently conducted, in each case,
subject to no Encumbrances required to be disclosed in the Financial
Statements except as set forth therein, other than any failure to own
or possess sufficient legal rights which, individually or in the
aggregate, would not have a Corporation Material Adverse Effect. All
of the Intellectual Property which is owned by the Corporation is
owned free and clear of all Encumbrances; none of the Corporation's
rights in or use of the Intellectual Property has been or, to the
Corporation's knowledge, is currently threatened to be challenged; to
the Corporation's knowledge, without making any inquiry other than
those, if any, routinely conducted by the Corporation in the ordinary
course of business, no current or currently planned product based upon
the Corporation's Intellectual Property would infringe any patent,
trademark, service mark, trade name or copyright of any other person
or entity issued or pending on the Closing Date if the Corporation
were to distribute, sell, market or manufacture such products, and the
Corporation is not aware of any actual or threatened claim by any
person or entity alleging any infringement by the Corporation of a
patent, trademark, service mark, trade name or copyright possessed by
such person or entity. None of such Intellectual Property, whether
foreign or domestic, has been canceled, abandoned, or otherwise
terminated, other than such cancellations, abandonments or
terminations which, individually or in the aggregate, would not have a
Corporation Material Adverse Effect.
(7) Legal Proceedings, etc. Except as set forth under the
Corporation's SEC Filings, if any, there is no legal, administrative,
arbitration or other action or proceeding or governmental or
investigation pending, or to the Corporation's knowledge, threatened
against the Corporation, or any director, officer or employee of the
Corporation in their capacities as such that (i) challenges the
validity or performance of this Agreement or (ii) could reasonably be
expected to have a Corporation Material Adverse Effect. The
Corporation is not in violation of, or default under, any material
laws, judgments, injunctions, orders or decrees of any court,
governmental department, commission, agency, instrumentality or
arbitrator applicable to its business, other than any violations or
defaults which, individually or in the aggregate, would not have a
Corporation Material Adverse Effect.
5. Anti-Dilution.
a. Reorganization Transactions. The applicable Exercise Price and the
number of Warrant Shares issuable upon exercise of this Warrant are subject
to adjustment from time to time upon the occurrence hereafter of certain
transactions by the issuer of the Warrant Shares, including dividends of
stock or other securities or property, stock splits, reverse stock splits,
subdivisions, combinations, recapitalizations, reorganizations,
reclassifications, consolidations and any liquidation or dissolution of
such issuer (each a "Reorganization"). In the event that the outstanding
Successor Stock issued by the Surviving Corporation or the outstanding
Frontier Stock issued by the Corporation is at any time increased or
decreased solely by reason of a Reorganization, appropriate adjustments in
the number and kind of such securities then subject to this Warrant shall
be made effective as of the date of such occurrence so that the interest of
the Holder upon exercise will be the same as it would have been had such
Holder owned the underlying securities immediately prior to the occurrence
of such event. Such adjustment shall be made successively whenever any
Reorganization shall occur.
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b. Notice. Notice of matters arising under this Section 5 shall be
given pursuant to Section 7 below.
c. Adjustments. Except as otherwise provided herein, the effective
date of any adjustment pursuant to Section 5(a) shall be the effective date
of the event that causes such adjustment.
6. Special Agreements of the Corporation.
a. Reservation of Successor Stock. The Corporation covenants and
agrees that it will cause the Surviving Corporation to reserve and set
apart and have at all times, a number of shares of authorized but unissued
Successor Stock deliverable upon the exercise of the Warrant or any other
rights or privileges provided for therein sufficient to enable it at any
time to fulfill all of its obligations there under; and if at any time the
number of authorized but unissued shares of Successor Stock shall not be
sufficient to effect the exercise of the Warrant at the Exercise Price then
in effect, the Surviving Corporation will take such corporate action as
may, in the opinion of its counsel, be necessary to increase its authorized
but unissued shares of Successor Stock to such number of shares as shall be
sufficient for such purpose.
b. Par Value. As a condition precedent to the taking of any action
which would cause an adjustment reducing the Exercise Price below the then
par value, if any, per share of the Successor Stock issuable upon exercise
of this Warrant, the Surviving Corporation will take such corporate action
as may, in the opinion of its counsel, be necessary in order that the
Surviving Corporation may validly and legally issue its Successor Stock at
the Exercise Price upon exercise of this Warrant in accordance with the
provisions hereof.
c. Shares to be Fully Paid and Non-Assessable. The Corporation
covenants that all shares of Successor Stock which may be issued upon
exercise of this Warrant will be, upon issuance and payment of the Exercise
Price, fully paid and non-assessable.
d. Exchange Act Reports. If the Corporation becomes subject to the
reporting requirements of Sections 13(a) or 15(d) of the Securities
Exchange Act of 1934 (the "Exchange Act"), then the Corporation shall
prepare and timely file all such reports which it is required to file under
the Exchange Act until the earlier of such time as Holder has sold all of
the Warrant Shares or such time as the Corporation is no longer subject to
such reporting requirements under the Exchange Act; provided, however, that
nothing in this Warrant shall obligate the Corporation to become subject to
or remain subject to the reporting requirements of Sections 13(a) or 15(d)
of the Exchange Act.
7. Notices.
a. All notices, requests and other communications hereunder must be in
writing and will be deemed to have been duly given only if delivered
personally or by facsimile transmission or mailed (first class postage
prepaid) to the parties at the following addresses or facsimile numbers:
(i) if to the Holder, to the name, address and facsimile number set forth
in the Purchase Agreement pursuant to which this Warrant was issued or any
other address or facsimile number delivered to the Corporation in writing
by the Holder, or to the name, address and facsimile number of any
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transferee of this Warrant recorded on the books of the Corporation and
(ii) if to the Corporation, to 0000 Xxx Xxxxxxxx Xxxxxxx, xxxxx X-0,
Xxxxxxxxxxx, Xxx Xxxxxx 00000. With respect to any Holder of Warrant
Shares, such notices, requests and other communications shall be sent to
the addresses set forth in the stock transfer records regularly maintained
by the Corporation or the Surviving Corporation, as applicable.
b. All such notices, requests and other communications will (i) if
delivered personally to the address as provided in this Section, be deemed
given upon delivery, (ii) if delivered by facsimile transmission to the
facsimile number as provided in this Section, be deemed given upon receipt,
and (iii) if delivered by mail in the manner described above to the address
as provided in this Section, be deemed given upon receipt (in each case
regardless of whether such notice, request or other communication is
received by any other person to whom a copy of such notice is to be
delivered pursuant to this Section 7). Any party from time to time may
change its address, facsimile number or other information for the purpose
of notices to that party by giving notice specifying such change to the
other parties hereto.
8. Limitation of Liability. No provision hereof, in the absence of
affirmative action by the Holder to purchase the Warrant Shares as provided in
Section 2 above, and no mere enumeration herein of the rights or privileges of
the Holder hereof, shall give rise to any liability of such Holder for the
Exercise Price or as a stockholder of the Corporation, whether such liability is
asserted by the Corporation or the Surviving Corporation, or by creditors of the
Corporation or the Surviving Corporation.
9. Indemnification. The Holder acknowledges and understands the meaning and
legal consequences of the representations and warranties herein and hereby
agrees to indemnify and hold harmless the Corporation and its officers,
directors, controlling persons, agents, employees, attorneys and accountants
from and against any and all loss, damage or liability, together with all costs
and expenses (including attorneys fees and disbursements) which any of them may
incur by reason of:
a. any breach of any representation, warranty or agreement of the
undersigned contained in this Subscription Agreement; or
b. any false, misleading or inaccurate information, or any breach of
any representation, warranty or agreement of the undersigned, contained in
any agreement executed by the Holder in favor of the corporation.
Notwithstanding the foregoing, no representation, warranty, acknowledgment
or agreement made herein by the Holder shall in any manner be deemed to
constitute a waiver of any rights of the undersigned under federal or state
securities laws. All representations and warranties contained in this
Agreement and indemnification contained in paragraph 10, shall survive the
acceptance of this subscription and any other transaction contemplated
herein.
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IN WITNESS WHEREOF, the Corporation has caused this Warrant to be effective by
its signed by its duly authorized officer as of the 1st day of August, 2005.
Frontier Staffing, Inc., a Nevada Corporation
By: /s/ Xxxxxxxx Xxxxx
------------------------
Xxxxxxxx Xxxxx
Chief Executive Officer
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