Exhibit 4(ad)
This Warrant has not been registered under the Securities Act of 1933, as
amended, or applicable state securities laws, nor the securities laws of any
other jurisdiction. This Warrant may not be sold or transferred in the absence
of an effective registration statement under those securities laws or an opinion
of counsel, in form and substance satisfactory to the Company, that the sale or
transfer is pursuant to an exemption to the registration requirements of those
securities laws.
WARRANT FOR THE PURCHASE OF SHARES OF COMMON STOCK
(void after 5:00 p.m., New York City time, on June 13, 2007)
No. BF-1 250,000 Shares Dated as of June 13, 2002
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FOR VALUE RECEIVED, NCT GROUP, INC., a Delaware corporation (the "Company"), as
of the date hereof (the "Grant Date"), hereby issues this warrant (the
"Warrant") and certifies that Blue Future, Inc. (the "Holder") is granted the
right, subject to the provisions of this Warrant, to purchase from the Company,
during the period commencing at 9:00 a.m. New York City local time on the Grant
Date and expiring, unless earlier terminated as hereinafter provided, at 5:00
p.m. New York City local time on June 13, 2007 or, if such day is a day on which
banking institutions in the City of New York are authorized by law to close,
then on the next succeeding day that shall not be such a day (the "Exercise
Period"), up to Two Hundred Fifty Thousand (250,000) fully paid and
non-assessable shares of common stock, par value $.01 per share, of the Company
at a price of $0.16 per share (the "Exercise Price"). As used herein, "Common
Stock" means the shares of common stock, par value $.01 per share, of the
Company as constituted on the Grant Date, together with any other equity
securities that may be issued by the Company in addition thereto or in
substitution therefor. The number of shares of Common Stock to be received upon
the exercise of this Warrant may be adjusted from time to time as hereinafter
set forth. The Common Stock deliverable upon such exercise, as adjusted from
time to time, is sometimes referred to herein as the "Warrant Stock." Upon
receipt by the Company of evidence reasonably satisfactory to it of the loss,
theft, destruction or mutilation of this Warrant, and (in the case of loss,
theft or destruction) of reasonably satisfactory indemnification, and upon
surrender and cancellation of this Warrant, if mutilated, the Company shall
execute and deliver a new Warrant of like tenor and date. Any such new Warrant
executed and delivered shall constitute an additional contractual obligation on
the part of the Company, whether or not this Warrant so lost, stolen, destroyed
or mutilated shall be at any time enforceable by anyone. This Warrant is issued,
and all the rights hereunder are held, subject to all of the conditions,
limitations and provisions set forth herein.
1. Exercise of Warrant. This Warrant may be exercised in whole or in
part, at any time or from time to time, during the Exercise Period. Subject
to the restrictions and limitations set forth above, this Warrant may be
exercised by presentation and surrender of this Warrant to the Company at
its principal office, together with a completed and duly executed Warrant
Exercise Form in the form attached hereto as Exhibit 1 (the "Exercise
Form"), payment (either in cash or by certified or official bank check,
payable to the order of the Company) of the Exercise Price for the number
of shares of Common Stock specified in the Exercise Form and instruments of
transfer, if appropriate, duly executed by the Holder. If this Warrant is
exercised in part only, the Company shall, upon surrender of this Warrant
for cancellation, execute and deliver a new Warrant evidencing the rights
of the Holder to purchase the balance of the shares purchasable hereunder.
Upon receipt by the Company of this Warrant, an executed Exercise Form, the
Exercise Price and any appropriate instruments of transfer, the Holder
shall be deemed to be the holder of record of the shares of Common Stock
issuable upon such exercise, notwithstanding that the stock transfer books
of the Company shall then be closed or that certificates representing such
shares of Common Stock shall not then be actually delivered to the Holder.
The Company shall pay any and all documentary stamp or similar issue or
transfer taxes payable in respect of the issue or delivery of shares of
Common Stock upon exercise of this Warrant.
2. Reservation of Shares. The Company shall at all times reserve for
issuance and delivery upon exercise of this Warrant all shares of Common
Stock of the Company from time to time receivable upon exercise of this
Warrant. All such shares shall be duly authorized and, when issued upon
such exercise, shall be validly issued, fully paid, non-assessable and free
of all pre-emptive rights.
3. Warrant Stock Transfer to Comply with the Securities Act of 1933.
The Warrant Stock may not be sold, exchanged, transferred, assigned or
otherwise disposed of unless registered pursuant to the provisions of the
Securities Act of 1933, as amended (the "1933 Act"), or an opinion of
counsel in form and content satisfactory to the Company is delivered to the
Company stating that such sale or other disposition is made in compliance
with an available exemption from such registration. Any sale or other
disposition of the Warrant Stock must also comply with all applicable state
securities laws and regulations.
4. Fractional Shares. No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of this Warrant, but
the Company shall issue one additional share of its Common Stock in lieu of
each fraction of a share otherwise called for upon any exercise of this
Warrant.
5. Exchange, Transfer or Assignment of Warrant. This Warrant is not
registered under the 1933 Act nor under any state securities law or
regulation. This Warrant may not be sold, exchanged, transferred, assigned
or otherwise disposed of unless registered pursuant to the provisions of
the 1933 Act or an opinion of counsel in form and content satisfactory to
the Company is delivered to the Company stating that such disposition is in
compliance with an available exemption from registration. Any such
disposition must also comply with applicable state securities laws and
regulations.
6. Rights of the Holder. The Holder shall not, by virtue hereof, be
entitled to any rights of a stockholder of the Company, either at law or in
equity, and the rights of the Holder are limited to those expressed in this
Warrant.
7. Redemption. This Warrant is not redeemable by the Company.
8. Anti-Dilution Provisions.
8.1 Adjustment for Certain Dividends and Reclassifications. In case at
any time or from time to time after the Grant Date the holders of Common
Stock (or any other securities at the time receivable upon the exercise of
this Warrant) shall have received, or on or after the record date fixed for
the determination of eligible stockholders shall have become entitled to
receive without payment therefor, (a) other or additional securities or
property (other than cash) by way of dividend, (b) any cash paid or payable
except out of earned surplus of the Company at the Grant Date as increased
(decreased) by subsequent credits (charges) thereto (other than credits in
respect of any capital or paid-in surplus or surplus created as a result of
a revaluation of property) or (c) other or additional (or less) securities
or property (including cash) by way of stock-split, spin-off, split-up,
reclassification, combination of shares or similar corporate rearrangement,
then, in each such case, the Holder, upon the exercise of this Warrant as
provided in Section 1 hereof, shall be entitled to receive, subject to the
limitations and restrictions set forth herein, the amount of securities and
property (including cash in the cases referred to in clauses (b) and (c)
above) that such Holder would hold on the date of such exercise if on the
Grant Date it had been the holder of record of the number of shares of
Common Stock (as constituted on the Grant Date) subscribed for upon such
exercise as provided in Section 1 hereof and had thereafter, during the
period from the Grant Date to and including the date of such exercise,
retained such shares and/or all other additional (or less) securities and
property (including cash in the cases referred to in clauses (b) and (c)
above) receivable by it as aforesaid during such period, giving effect to
all adjustments called for during such period by Section 8.2 hereof.
8.2 Adjustment for Reorganization, Consolidation, Merger, Etc. In case
of any reorganization of the Company (or any other corporation, the
securities of which are at the time receivable on the exercise of this
Warrant) after the Grant Date or in case after such date the Company (or
any such other corporation) shall consolidate with or merge into another
corporation or convey all or substantially all of its assets to another
corporation, then, in each such case, the Holder, upon the exercise of this
Warrant as provided in Section 1 hereof at any time after the consummation
of such reorganization, consolidation, merger or conveyance, shall be
entitled to receive, in lieu of the securities and property receivable upon
the exercise of this Warrant prior to such consummation, the securities or
property to which such Holder would have been entitled upon such
consummation if such Holder had exercised this Warrant immediately prior
thereto, all subject to further adjustment as provided in Section 8.1
hereof. In each such case, the terms of this Warrant shall be applicable to
the securities or property receivable upon the exercise of this Warrant
after such consummation.
8.3 Certificate as to Adjustments. In each case of an adjustment in
the number of shares of Common Stock (or other securities or property)
receivable upon the exercise of this Warrant, the Company shall promptly
compute such adjustment in accordance with the terms of this Warrant and
deliver to the Holder a certificate setting forth such adjustment and
showing in detail the facts upon which such adjustment is based, including
a statement of (a) the consideration received or to be received by the
Company for any additional shares of Common Stock issued or sold or deemed
to have been issued or sold, (b) the number of shares of Common Stock
outstanding or deemed to be outstanding and (c) the pro forma adjusted
Exercise Price.
8.4 Notices of Record Date, Etc. In the event (a) the Company takes a
record of the holders of Common Stock (or other securities at the time
receivable upon the exercise of this Warrant) for the purpose of entitling
them to receive any dividend (other than a cash dividend) or other
distribution, or any right to subscribe for, purchase or otherwise acquire
any shares of stock of any class or any other securities, or to receive any
other right, (b) of any capital reorganization of the Company (other than a
stock split or reverse stock split), any reclassification of the capital
stock of the Company, any consolidation or merger of the Company with or
into another corporation (other than a merger for purposes of change of
domicile) or any conveyance of all or substantially all of the assets of
the Company to another corporation or (c) of any voluntary or involuntary
dissolution, liquidation or winding-up of the Company, then, in each such
case, the Company shall deliver to the Holder a notice specifying, as the
case may be, the date on which such record is to be taken for the purpose
of such dividend, distribution or right (and stating the amount and
character of such dividend, distribution or right) or the date on which
such reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation or winding-up is to take place (and the time, if
any is fixed, in which the holders of record of Common Stock or such other
securities at the time receivable upon the exercise of this Warrant shall
be entitled to exchange their shares of Common Stock or such other
securities for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation or winding-up). Such notice shall be mailed at
least twenty (20) days prior to the date of the corporate event to which it
relates, and this Warrant may be exercised no later than five (5) days
prior to the date of such corporate event (if during the Exercise Period).
9. Legend. In the event of the exercise of this Warrant and the
issuance of any Warrant Stock hereunder, all certificates representing
Warrant Stock shall bear on the face thereof substantially the following
legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL IN FORM,
SUBSTANCE AND SCOPE REASONABLY ACCEPTABLE TO THE BORROWER THAT
REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR UNLESS SOLD
PURSUANT TO RULE 144 UNDER SAID ACT. ANY SUCH SALE, TRANSFER OR
ASSIGNMENT MUST ALSO COMPLY WITH APPLICABLE STATE SECURITIES
LAWS.
10. Governing Law and Jurisdiction. This Warrant shall be governed by
the internal laws of the State of Delaware, without regard to the conflicts
of laws principles thereof. The parties hereto hereby submit to the
exclusive jurisdiction of the United States Federal Courts located in the
state of New Jersey with respect to any dispute arising under this Warrant.
11. Notices. Notices, demands and other communications given under
this Agreement shall be in writing and shall be deemed to have been given
when delivered (if personally delivered), on the scheduled date of delivery
(if delivered via commercial courier), three days after mailed (if mailed
by certified or registered mail, return receipt requested) or when sent by
facsimile (if sent by facsimile with evidence of successful transmission
retained by the sender); provided, however, that failure to give proper and
timely notice as set forth in the "with a copy to" provisions below shall
not invalidate a notice properly and timely given to the associated party.
Unless another address or facsimile number is specified by notice
hereunder, all notices shall be sent as follows:
If to the Holder:
Blue Future, Inc.
P.O. Box 2863392
New York, NY 10128
Attention: President
Facsimile: 000-000-0000
If to the Company: with a copy to:
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NCT Group, Inc. NCT Group, Inc.
00 Xxxxxxx Xxxxxx 00 Xxxxxxx Xxxxxx
Xxxxxxxx, XX 00000 Xxxxxxxx, XX 00000
Attention: Chief Financial Officer Attention: General Counsel
Facsimile: 000-000-0000 Facsimile: 000-000-0000
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
on its behalf, in its corporate name, by its duly authorized officer, as of
the date first set forth above.
NCT GROUP, INC.
By:/s/ Xxxxxxx X. Xxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxx
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Title:Chairman & CEO
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EXHIBIT 1
WARRANT EXERCISE FORM
(to be executed by the Holder in order to exercise the Warrant)
TO: NCT Group, Inc.
00 Xxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Chief Financial Officer
The undersigned hereby irrevocably elects to exercise the within
Warrant to the extent of purchasing ____________ shares of common stock,
par value $.01 per share, of NCT Group, Inc. and hereby makes payment at
the rate of $______ per share, or an aggregate of $__________, in payment
therefor.
The undersigned represents, warrants and certifies that all offers and
sales of the common stock received upon exercise of the within Warrant
shall be made (i) pursuant to an effective registration statement under the
Securities Act of 1933, as amended (the "1933 Act"), or pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the 1993 Act and (ii) in compliance with applicable state
securities laws and those of any other applicable jurisdiction.
Instructions if stock is to be issued to other than to the registered holder of
the within Warrant:
Name:
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Address:
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Social Security or Taxpayer Identification Number:
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Dated: , 20
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Name of Warrant Holder
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Signature