WORLDWIDE ENTERTAINMENT & SPORTS CORP.
AND
XXXXXXX XXXXX & COMPANY, LLC
UNDERWRITER'S
WARRANT AGREEMENT
UNIT PURCHASE OPTION AGREEMENT dated as of __________, 1992 by and between
WORLDWIDE ENTERTAINMENT & SPORTS CORP., a Delaware corporation (the "Company"),
and XXXXXXX XXXXX & COMPANY, LLC (hereinafter referred to variously as the
"Holder" or the "Underwriter").
W I T N E S S E T H:
WHEREAS, the Company proposes to issue to the Underwriter warrants
("Warrants") to purchase up to 130,000 units (the "Units") each unit consisting
of one share of common stock, $.01 par value, of the Company ("Common Stock")
and one redeemable warrant to purchase one share of Common Stock (the
"Redeemable Warrants"); and
WHEREAS, the Underwriter has agreed pursuant to the underwriting agreement
(the "Underwriting Agreement") dated __________ 1996 by and between the
Underwriter and the Company to act as the underwriter in connection with the
Company's public offering of up to 1,300,000 Units; and
WHEREAS, the Warrants to be issued pursuant to this Agreement will be
issued on the Closing Date (as such term is defined in the Underwriting
Agreement) and on each subsequent
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Closing Date by the Company to the Underwriter in consideration for, and as part
of the Underwriter's compensation in connection with, the Underwriter's acting
as the underwriter pursuant to the Underwriting Agreement;
NOW, THEREFORE, in consideration of the premises, the payment by the
Underwriter to the Company of ten dollars ($10.00), the agreements herein set
forth and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
1. Grant. The Holder is hereby granted the right to purchase, at
any time from ___________, 1997 until 5:00 p.m., New York time, on
_______________, 2002, up to ten percent (10%) of the Units sold by the
Underwriter in the Public Offering at an initial exercise price (subject to
adjustment as provided in Article 8 hereof) of $_____ per Unit (165% of the
Public Offering price per Unit, subject to the terms and conditions of this
Agreement.
2. Warrant Certificates. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall be
in the form set forth in Exhibit A, attached hereto and made a part hereof, with
such appropriate insertions, omissions, substitutions, and other variations as
required or permitted by this Agreement.
3. Exercise of Warrants. The Warrants are exercisable during the
term set forth in Section 1 hereof at the Exercise Price per unit set forth in
Section 6 hereof payable by certified
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or cashier's check or money order payable in lawful money of the United States,
subject to adjustment as provided in Article 8 hereof. Upon surrender of a
Warrant Certificate with the annexed Form of Election to Purchase duly executed,
together with payment of the Exercise Price (as hereinafter defined) for the
unit (and such other amounts, if any, arising pursuant to Section 4 hereof) at
the Company's principal offices located at 00 Xxxxxxxxxx Xxxxxx, Xxxx Xxxxxx,
Xxx Xxxxxx 00000, the registered holder of a Warrant Certificate ("Holder" or
"Holders") shall be entitled to receive a certificate or certificates for the
securities comprising the units so purchased. The purchase rights represented by
each Warrant Certificate are exercisable at the option of the Holder thereof, in
whole or in part (but not as to fractional units). The Warrants may be exercised
to purchase all or part of the units represented thereby. In the case of the
purchase of less than all the units purchasable on the exercise of Warrants
represented by a Warrant Certificate, the Company shall cancel the Warrant
Certificate represented thereby upon the surrender thereof and shall execute and
deliver a new Warrant Certificate of like tenor for the balance of the units
purchasable thereunder.
4. Issuance of Certificates. Upon the exercise of the Warrants
and payment of the Exercise Price therefor, the issuance of certificates for the
Common Stock, Redeemable Warrants or other securities, properties or rights
underlying such Warrants shall be made forthwith (and in any event within three
(3) business days
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thereafter) without further charge to the Holder thereof, and such certificates
shall (subject to the provisions of Sections 5 and 7 hereof) be issued in the
name of, or in such names as may be directed by, the Holder thereof; provided,
however, that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and delivery of any
such certificates in a name other than that of the Holder, and the Company shall
not be required to issue or deliver such certificates unless or until the person
or persons requesting the issuance thereof shall have paid to the Company the
amount of such tax or shall have established to the satisfaction of the Company
that such tax has been paid. The Warrant certificates and the certificates
representing the Common Stock or other securities, property or rights (if such
property or rights are represented by certificates) shall be executed on behalf
of the Company by the manual or facsimile signature of the then present Chairman
or Vice Chairman of the Board of Directors or President or Vice President of the
Company under its corporate seal reproduced thereon, attested to by the manual
or facsimile signature of the then present Secretary or Assistant Secretary or
Treasurer or Assistant Treasurer of the Company. Warrant Certificates shall be
dated the date of execution by the Company upon initial issuance, division,
exchange, substitution or transfer.
5. Restriction On Transfer of Warrants. The Holder of a Warrant
Certificate (and its Permitted Transferee, as defined below), by its acceptance
thereof, covenants and agrees that the
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Warrants are being acquired as an investment and not with a view to the
distribution thereof; that the Warrants may be sold, transferred, assigned,
hypothecated or otherwise disposed of, in whole or in part, to any person (a
"Permitted Transferee"), provided such transfer, assignment, hypothecation or
other deposition is made in accordance with the provisions of the Securities Act
of 1933, as amended (the "Act"); and provided, further, that until __________,
1997 only officers and directors of the Underwriter, and any co-underwriter,
selling group member and their respective officers and directors shall be
Permitted Transferees.
6. Exercise Price.
a. Initial and Adjusted Exercise Price. Except as
otherwise provided in Section 8 hereof, the initial exercise price of each
Warrant shall be $7.20 per Share. The adjusted exercise price shall be the price
which shall result from time to time from any and all adjustments of the initial
exercise price in accordance with the provisions of Section 8 hereof.
b. Exercise Price. The term "Exercise Price" herein shall
mean the initial exercise price or the adjusted exercise price, depending upon
the context.
7. Registration Rights.
a. Registration Under the Securities Act of 1933. The
Warrants have not been registered under the Act. The Warrant certificates shall
bear the following legend:
The securities represented by this certificate
have not been registered under the Securities
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Act of 1933, as amended (the "Act"), and may not be offered for
sale or sold except pursuant to (i) an effective registration
statement under the Act, or (ii) an opinion of counsel, if such
opinion shall be reasonably satisfactory to counsel to the
issuer, that an exemption from registration under such Act is
available.
b. Demand Registration. (1) At any time commencing one (1)
year and expiring five (5) years after the effective date of the Company's
Registration Statement relating to the Public Offering (the "Effective Date"),
the Underwriter shall have the right, exercisable by written notice to the
Company, to have the Company prepare and file with the Securities and Exchange
Commission (the "Commission"), on one (1) occasion, a registration or offering
statement on Form S-1 and such other documents, including a prospectus, as may
be necessary in the opinion of both counsel for the Company and counsel for the
Underwriter and the Holders, in order to comply with the provisions of the Act,
so as to permit a public offering and sale, for a period of nine (9) months, of
the shares underlying the Warrants ("Warrant Securities") by such Holders and
any other Holders of the Warrants and/or Warrant Securities who notify the
Company within fifteen (15) business days after receipt of the notice described
above. The Underwriter may demand registration on behalf of the Holders without
exercising the Underwriter's Warrants, and are never required to exercise same.
(2) The Company covenants and agrees to give written
notice of any registration request under this Section 7(b) by the Underwriter to
all other registered Holders of the Warrants
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and the Warrant Securities within ten (10) days from the date of the receipt of
any such registration request.
c. Piggyback Registration. If, at any time within the four
(4) year period commencing one (1) year and expiring five (5) years after the
Effective Date, the Company should file a registration statement with the
Commission under the Act (other than in connection with a merger or pursuant to
Forms S-4 or S-8) it will give written notice by registered mail, at least
thirty (30) days prior to the filing of each such registration statement, to the
Underwriter and to all other Holders of the Warrants and/or the Warrant
Securities of its intention to do so. If the Underwriter or other Holders of the
Warrants and/or the Warrant Securities notify the Company within twenty (20)
days after receipt of any such notice of its or their desire to include any such
securities in such proposed registration statement, the Company shall afford the
Underwriter and such Holders of the Warrants and/or Warrant Securities the
opportunity to have any such Warrant Securities registered under such
registration statement. Notwithstanding the provisions of this Section 7(c), the
Company shall have the right at any time after it shall have given written
notice pursuant to this Section 7(c) (irrespective of whether a written request
for inclusion of any such securities have shall have been made) to elect not to
file any such proposed registration statement, or to withdraw the same after the
filing but prior to the effective date thereof. If a subsequent underwriter
objects to the above piggy-back rights,
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such objection would preclude such inclusion. However, in such event, the
Company will, within six (6) months of completion of such subsequent
underwriting, file at its sole expense a registration statement relating to
such excluded securities, which shall be in addition to any registration
statement required to be filed pursuant to Section 7(b).
d. Covenants of the Company With Respect to Registration.
In connection with any registration under Sections 7(b) and 7(c) hereof, the
Company covenants and agrees as follows:
(1) The Company shall use its best efforts to file a
registration statement within thirty (30) days of receipt of any demand
therefor, shall use its best efforts to have any registration statements
declared effective at the earliest possible time, and shall furnish each Holder
desiring to sell Warrant Securities such number of prospectuses as shall
reasonably be requested.
(2) The Company shall pay all costs (excluding fees
and expenses of Holder(s)' counsel and any underwriting discounts or selling
fees, expenses or commissions), fees and expenses in connection with the first
registration statement filed pursuant to Section 7(b) and any registration
statement filed pursuant to Section 7(c) hereof including, without limitation,
the Company's legal and accounting fees, printing expenses, blue sky fees and
expenses. If the Company shall fail to comply with the provisions of Section
7(d)(1), the Company shall, in addition to any other equitable or other relief
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available to the Holder(s), be liable for any or all incidental, special and
consequential damages and damages due to loss of profit sustained by the
Holder(s) requesting registration of their Warrant Securities.
(3) The Company will take all necessary action which
may be required to qualify or register the Warrant Securities included in a
registration statement for offering and sale under the securities or blue sky
laws of such states as reasonably are requested by the Holder(s), provided that
the Company shall not be obligated to execute or file any general consent to
service of process or to qualify as a foreign corporation to do business under
the laws of any such jurisdiction.
(4) The Company shall indemnify the Holder(s) of the
Warrant Securities to be sold pursuant to any registration statement and each
person, if any, who controls such Holders within the meaning of Section 15 of
the Act or Section 20(a) of the Securities Exchange Act of 1934, as amended
("Exchange Act"), against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which any of them may become subject
under the Act, the Exchange Act or otherwise, arising from such registration
statement but only to the same extent and with the same effect as the provisions
pursuant to which the Company has agreed to indemnify the Underwriter contained
in Section 8 of the Underwriting Agreement, and the
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Holder(s) shall indemnify the Company to the same extent and with the same
effect as the provisions pursuant to which the Underwriter has agreed to
indemnify the Company contained in Section 8 of the Underwriting Agreement.
(5) The Holder(s) of the Warrant Securities to be
sold pursuant to a registration statement, and their successors and assigns,
shall severally, and not jointly, indemnify the Company, its officers and
directors and each person, if any, who controls the Company within the meaning
of Section 15 of the Act or Section 20(a) of the Exchange Act, against all loss,
claim, damage or expense or liability (including all expenses reasonably
incurred in investigating, preparing or defending against any claim whatsoever)
to which they may become subject under the Act, the Exchange Act or otherwise,
arising from information furnished by or on behalf of such Holders, or their
successors or assigns, for specific inclusion in such registration statement to
the same extent and with the same effect as the provisions contained in Section
8 of the Underwriting Agreement pursuant to which the Underwriter has agreed to
indemnify the Company.
(6) Nothing contained in this Agreement shall be
construed as requiring the Holder(s) to exercise their Warrants prior to the
initial filing of any registration statement or the effectiveness thereof.
(7) The Company shall not be entitled to include any
securities other than the Warrant Securities in any
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registration statement filed pursuant to Section 7(b) hereof without the prior
written consent of the Underwriter and the Holders of the Warrants and Warrant
Securities representing a Majority of such securities (assuming exercise of all
of the Warrants).
(8) The Company shall furnish to each Holder
participating in the offering and to each underwriter, if any, a signed
counterpart, addressed to such Holder or underwriter of (i) an opinion of
counsel to the Company, dated the effective date of such registration statement
(and if such registration includes an underwritten public offering, an opinion
dated the date of the closing under the underwriting agreement), and (ii) a
"cold comfort" letter dated the effective date of such registration statement
(and, if such registration includes an underwritten public offering, a letter
dated the date of the closing under the underwriting agreement) signed by the
independent public accounts who have issued a report on the Company's financial
statements included in such registration statement, in each case covering
substantially the same matters with respect to such registration statement (and
the prospectus included therein) and, in the case of such accountants' letter,
with respect to events subsequent to the date of such financial statements, as
are customarily covered in opinions of issuer's counsel and in accountants'
letter, with respects to events subsequent to the date of such financial
statements, as are customarily covered in opinions of issuer's counsel and in
accountants' letters delivered to underwriters in
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underwritten public offerings of securities.
(9) The Company shall as soon as practicable after
the effective date of the registration statement, and in any event within 15
months thereafter, make "generally available to its security holders" (within
the meaning of Rule 158 under the Act) an earnings statement (which need not be
audited) complying with Section 11(a) of the Act and covering a period of at
least 12 consecutive months beginning after the effective date of the
registration statement.
(10) The Company shall deliver promptly to each
Holder participating in the offering requesting the correspondence described
below and any managing underwriter copies of all correspondence between the
Commission and the Company, its counsel or auditors with respect to the
registration statement and permit each Holder and underwriter to do such
investigation, upon reasonable advance notice, with respect to information
contained in or omitted from the registration statement as it deems reasonably
necessary to comply with applicable securities laws or rules of the National
Association of Securities Dealers, Inc. ("NASD"). Such investigation shall
include access to books, records and properties and opportunities to discuss the
business of the Company with its officers and independent auditors, all to such
reasonable extent and at such reasonable times and as often as any such Holder
shall reasonably request.
(11) The Company shall enter into an underwriting
agreement with the managing underwriter selected for
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such underwriting by Holders holding a Majority of the Warrant Securities
requested to be included in such underwriting, except that in connection with an
offering for which the Holders have piggyback rights, the Company shall have the
sole right to select the managing underwriter. Such underwriting agreement shall
be satisfactory in form and substance to the Company, a Majority of such Holders
and such managing underwriters, and shall contain such representations,
warranties and covenants by the Company and such other terms as are customarily
contained in agreements of that type used by the managing underwriter. The
Holders shall be parties to any underwriting agreement relating to an
underwritten sale of their Warrant Securities and may, at their option, require
that any or all the representations, warranties and covenants of the Company to
or for the benefit of such underwriters shall also be made to and for the
benefit of such Holders. Such Holders shall not be required to make any
representations or warranties to or agreements with the Company or the
underwriters except as they may relate to such Holders and their intended
methods of distribution.
(12) For purposes of this Agreement, the term
"Majority" in reference to the Holders of the Warrants or Warrant Securities,
shall mean in excess of fifty percent (50%) of the then outstanding Warrants or
Warrant Securities that (i) are not held by the Company, an affiliate, officer,
creditor, employee or agent thereof or any of their respective affiliates,
members of their family, persons acting as nominees or in conjunction there-
with, or (ii) have not been resold to the public pursuant to a
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registration statement filed with the Commission under the Act.
e. Repurchase of Warrants. In the event the Company shall
fail to file the registration statement required by Section 7(b), or such
registration statement shall not be declared effective within 150 days of the
written request, then the Underwriter may require the Company to purchase, on
the 151st day, the Underwriter's Warrants at a price equal to the difference
between the Exercise Price and the market price per share of Common Stock as
averaged over the mean between the "bid and "asked" price as of the close of
each business day during the two-week period immediately preceding the 151st
day; provided, however, that at the time of such purchase the average market
price shall be more than $7.20 further provided that the Company's net worth, at
such time, is at least three (3) times the amount of the aggregate purchase
price for such Underwriter's Warrants to be purchased.
f. Further Registrations. The Company will cooperate with
the Holder(s) of the Warrants and Warrant Securities in preparing and signing
any registration statement, in addition to the registration statements discussed
above, required in order to sell or transfer the Warrant Securities and will
supply all information required therefor, but such additional registration
statement expenses or offering statement expenses will be prorated between the
Company and the Holders of the Warrants and Warrant Securities according to the
aggregate sales price of the securities being issued. The provision of Section
7(d) other than subsection (2) shall apply to any such
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registration statement.
8. Adjustments to Exercise Price and Number of Securities.
a. Subdivision and Combination. In case the Company shall
at any time subdivide or combine the outstanding shares of Common Stock, the
Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
b. Adjustment in Number of Securities. Upon each
adjustment of the Exercise Price pursuant to the provisions of this Section 8,
the number of Securities issuable upon the exercise of each Warrant shall be
adjusted to the nearest full amount by multiplying a number equal to the
Exercise Price in effect immediately prior to such adjustment by the number of
Securities issuable upon exercise of the Warrants immediately prior to such
adjustment and dividing the product so obtained by the adjusted Exercise Price.
c. Definition of Common Stock. For the purpose of this
Agreement, the term "Common Stock" shall mean (i) the class of stock designated
as Common Stock in the Certificate of Incorporation of the Company as it may be
amended as of the date hereof, or (ii) any other class of stock resulting from
successive changes or reclassification of such Common Stock consisting solely of
changes in par value, or from par value to no par value, or from no par value to
par value. In the event that the Company shall after the date hereof issue
securities with greater or
15
superior voting rights than those of the shares of Common Stock outstanding as
of the date hereof, the Holder, at its option, may receive upon exercise of any
Warrant either shares of Common Stock or a like number of such securities with
greater or superior voting rights.
d. Reclassification, Merger or Consolidation. The Company
will not merge, reorganize or take any other action which would terminate the
Underwriter's Warrant without first making adequate provision for the
Underwriter's Warrants. In case of any reclassification or change of the
outstanding shares of Common Stock (other than a change in par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination), or in case of any consolidation of the Company with, or merger of
the Company with, or merger of the Company into, another corporation (other than
a merger with a subsidiary in which merger the Company is the continuing
corporation and other than a consolidation or merger which does not result in
any reclassification or change of the outstanding Common Stock except a change
as a result of a subdivision or combination of such shares or a change in par
value, as aforesaid), the Holder of each Warrant then outstanding or to be
outstanding shall have the right thereafter (until the expiration of such
Warrant) to receive, upon exercise of such Warrant, the kind and amount of
shares of stock and other securities and property receivable upon such
consolidation or merger, by a holder of the number of shares of Common Stock of
the Company for which such Warrant might have been
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exercised immediately prior to such reclassification, consolidation, merger,
sale or transfer, and in the event of a consolidation, merger or sale of
property, the corporation formed by such consolidation or merger or acquired
such property shall execute and deliver to the Holder a supplemental warrant
agreement to such effect. Such supplemental warrant agreement shall provide for
adjustments which shall be identical to the adjustment to those provided in
Section 8. The provisions of this Section 8(d) shall similarly apply to
successive consolidations or mergers.
e. No Adjustment of Exercise Price in Certain Cases. No
adjustment of the Exercise Price shall be made:
(1) Upon the issuance or sale of the Warrants
or the shares of Common Stock issuable upon the exercise of (i) the Warrants, or
(ii) the options, warrants, stock purchase agreements and convertible or
exchangeable securities outstanding or in effect on the date hereof as described
in the prospectus relating to the Public Offering; or
(2) If the amount of said adjustment shall be
less than five (5) cents per Share, provided, however, that in such case any
adjustment that would otherwise be required then to be made shall be carried
forward and shall be made at the time of and together with the next subsequent
adjustment which, together with any adjustment so carried forward, shall amount
to at least five (5) cents per Share.
f. Dividends and Other Distributions. In the event that
the Company shall at any time prior to the exercise of
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all the Warrants declare a dividend (other than a cash dividend or a dividend
consisting solely of shares of Common Stock) or otherwise distribute to its
stockholders any assets, property, rights, evidences of indebtedness, securities
(other than shares of Common Stock), whether issued by the Company or by
another, or any other thing of value, the Holders of the unexercised Warrants
shall thereafter be entitled, in addition to the shares of Common Stock and
Redeemable Warrants or other securities and property receivable upon the
exercise thereof, to receive, upon the exercise of such Warrants, the same
property, assets, rights, evidences of indebtedness, securities or any other
thing of value that they would have been entitled to receive at the time of such
dividend or distribution as if the Warrants had been exercised immediately prior
to such dividend or distribution. At the time of any such dividend or
distribution, the Company shall make appropriate reserves to ensure the timely
performance of the provisions of this Section 8(f).
9. Exchange and Replacement of Warrant Certificates. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of Units in such denominations as shall be
designated by the Holder thereof at the time of such surrender.
Upon receipt by the Company of evidence reasonably
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satisfactory to it of the loss, theft, destruction or mutilation of any Warrant
Certificate, and, in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and reimbursement to the Company of all
reasonable expenses incidental thereto, and upon surrender and cancellation of
the Warrants, if mutilated, the Company will make and deliver a new Warrant
Certificate of like tenor, in lieu thereof.
10. Elimination of Fractional Interests. The Company shall not be
required to issue certificates representing fractions of shares of Common Stock
or public warrants upon the exercise of the Warrant, nor shall it be required to
issue script or pay cash in lieu of fractional interests, it being the intent of
the parties that all fractional interests; provided, however, that if a Holder
exercises all Warrants held of record by such Holder the fractional interests
shall be eliminated by rounding any fraction up to the nearest whole number of
shares of Common Stock, Redeemable Warrants or other securities, properties or
rights.
11. Reservation and Listing of Securities. The Company shall at
all times reserve and keep available out of its authorized shares of Common
Stock and Redeemable Warrants, solely for the purpose of issuance upon the
exercise of the Warrants, such number of shares of Common Stock, Redeemable
Warrants or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the
Warrants and payment of the
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Exercise Price therefor, all shares of Common Stock, Redeemable Warrants and
other securities issuable upon such exercise shall be duly and validly issued,
fully paid, non-assessable and not subject to the preemptive rights of any
stockholder. As long as the Warrants shall be outstanding, the Company shall use
its best efforts to cause the Common Stock and Redeemable Warrants to be listed
(subject to official notice of issuance) on all securities exchanges on which
the Common Stock and Redeemable Warrants issued to the public in connection
herewith may then be listed or quoted on NASDAQ.
12. Notices to Warrant Holders. Nothing contained in this
Agreement shall be construed as conferring upon the Holders the right to vote or
to consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the election of directors or any other matter, or as having any
rights whatsoever as a stockholder of the Company. If, however, at any time
prior to the expiration of the Warrants and their exercise, any of the following
events shall occur:
a. the Company shall take a record of the holders of its
shares of Common Stock and Redeemable Warrants for the purpose of
entitling them to receive a dividend or distribution payable otherwise
than in cash, or a cash dividend or distribution payable otherwise than
out of current or retained earnings, as indicated by the accounting
treatment of such dividend or distribution on
20
the books of the Company; or
b. the Company shall offer to all the holders of its
Common Stock and/or Redeemable Warrants, any additional shares of
capital stock of the Company or securities convertible into or
exchangeable for shares of capital stock of the Company, or any option,
right or warrant to subscribe therefor; or
c. a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale of
all or substantially all of its property, assets and business as an
entirety shall be proposed; then, in any one or more of said events, the
Company shall give written notice of such event at least fifteen (15)
days prior to the date fixed as a record date or the date of closing the
transfer books for the determination of the stockholders entitled to
such dividend, distribution, convertible or exchangeable securities or
subscription rights, or entitled to vote on such proposed dissolution,
liquidation, winding up or sale. Such notice shall specify such record
date or the date of closing the transfer books, as the case may be.
Failure to give such notice or any defect therein shall not affect the
validity of any action taken in connection with the declaration or
payment of any such dividend, or the issuance of any convertible or
exchangeable securities, or subscription rights, options or warrants, or
any proposed dissolution,
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liquidation, winding up or sale.
13. Notices. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed to have been
duly made when delivered, or mailed by registered or certified mail, return
receipt requested:
a. If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the Company; or
b. If to the Company to the address set forth in Section 3
hereof or to such other address as the Company may designate by notice
to the Holders.
14. Supplements and Amendments. The Company and the Underwriter
may from time to time supplement or amend this Agreement without the approval of
any Holders of Warrant Certificates (other than the Underwriter) in order to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with any provisions herein, or to make
any other provisions in regard to matters or questions arising hereunder which
the Company and the Underwriter may deem necessary or desirable and which the
Company and the Underwriter deem shall not adversely affect the interests of the
Holders of Warrant Certificates.
15. Successors. All the covenants and provisions of this
Agreement shall be binding upon and inure to the benefit of the Company, the
Underwriter, the Holders and their respective successors and assigns hereunder.
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16. Termination. This Agreement shall terminate at the close of
business on _____________, 2002. Notwithstanding the foregoing, the
indemnification provisions of Section 7 shall survive such termination until the
close of business on the later of the expiration of any applicable statue of
limitations or ______________, ____.
17. Governing Law; Submission to Jurisdiction. This Agreement and
each Warrant Certificate issued hereunder shall be deemed to be a contract made
under the laws of the State of New York and for all purposes shall be construed
in accordance with the laws of said State without giving effect to the rules of
said State governing the conflicts of laws. The Company, the Underwriter and the
Holders hereby agree 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 of the United States of America for the
Southern District of New York, and irrevocably submits to such jurisdiction,
which jurisdiction shall be exclusive. The Company, the Underwriter and the
Holders hereby irrevocably waive any objection to such exclusive jurisdiction or
inconvenient forum. Any such process or summons to be served upon any of the
Company, the Underwriter and the Holders (at the option of the party bringing
such action, proceeding or claim) 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 13 hereof.
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Such mailing shall be deemed personal service and shall be legal and binding
upon the party so served in any action, proceeding or claim.
18. Entire Agreement; Modification. This Agreement (including the
Underwriting Agreement to the extent portions thereof are referred to herein)
contains the entire understanding between the parties hereto with respect to the
subject matter hereof. Subject to Section 14, this Agreement may not be modified
or amended except by a writing duly signed by the party against whom enforcement
of the modification or amendment is sought.
19. Severability. If any provision of this Agreement shall be
held to be invalid or unenforceable, such invalidity or unenforceability shall
not affect any other provision of this Agreement.
20. Captions. The caption headings of the Sections of this
Agreement are for convenience of reference only and are not intended, nor should
they be construed as, a part of this Agreement and shall be given no substantive
effect.
21. Benefits of this Agreement. Nothing in this Agreement shall
be construed to give to any person or corporation other than the Company and the
Underwriter and any other registered Holder(s) of the Warrant Certificates or
Warrant Securities any legal or equitable right, remedy or claim under this
Agreement; and this Agreement shall be for the sole and exclusive benefit of the
Company and the Underwriter and any
24
other Holder(s) of the Warrant Certificates or Warrant
Securities.
22. 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 such counter parts shall together constitute but one and the
same instrument.
23. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the Company, the Underwriter and their respective
successors and assigns and the Holders from time to time of the Warrant
Certificate or any of them.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed, as of the day and year first above written.
WORLDWIDE ENTERTAINMENT
& SPORTS CORP.
By:__________________________
XXXXXXX XXXXX & COMPANY, LLC
By:___________________________
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EXHIBIT A
WARRANT CERTIFICATE
THE SECURITIES ISSUABLE UPON EXERCISE OF THE WARRANTS REPRESENTED BY THIS
CERTIFICATE MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, (ii) TO THE EXTENT
APPLICABLE, RULE 144 UNDER SUCH ACT (OR ANY SIMILAR RULE UNDER SUCH ACT RELATING
TO THE DISPOSITION OF SECURITIES), OR (iii) AN OPINION OF COUNSEL, IF SUCH
OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL FOR THE ISSUER, THAT AN
EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended (the "Act"), and may not be
offered for sale or sold except pursuant to (i) an effective
registration statement under the Act, or (ii) an opinion of counsel, if
such opinion shall be reasonably satisfactory to counsel to the issuer,
that an exemption from registration under such Act is available.
THE TRANSFER OR EXCHANGE OF THE WARRANT REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE COMMENCING _______________, 1997 THROUGH
5:00 P.M., NEW YORK __________, 2002
No. W-1 ______ Warrants
This Warrant Certificate certifies that Xxxxxxx Xxxxx & Company,
LLC (the "Underwriter") or registered assigns, is the registered holder of
______ Warrants to purchase initially, at any time from _______, 1997, until
5:00 p.m., New York time on _________, 2002 ("Expiration Date"), up to ______
units (the "Units"). Each unit consists of ___ shares of common stock $.001 par
value (the "Common Stock"), of Trans Energy, Inc., a Nevada corporation (the
"Company") and one Warrant to purchase one share of Common stock (the
"Redeemable Warrants"), at the exercise price of $.10 per Share (the "Exercise
Price"), and upon the surrender of this Warrant Certificate and payment of the
Exercise Price at an office or agency of the Company, but subject to the
conditions set forth herein and in the warrant agreement dated as of
____________, 1996 by and between the Company and the Underwriter (the "Warrant
Agreement"). Payment of the Exercise Price shall be made by certified or
cashier's check or money order payable to the order of the Company.
No Warrant may be exercised after 5:00 p.m., New York time, on
the Expiration Date, at which time all Warrants
evidenced hereby, unless exercised prior thereto, hereby shall thereafter be
void.
The Warrants evidenced by this Warrant Certificate are part
Underwriter's of a duly authorized issue of Warrants issued pursuant to the
Warrant Agreement between the Company and the Underwriter (the "Warrant
Agreement"), which Warrant Agreement is hereby incorporated by reference in and
made a part of this instrument and is hereby referred to for a description of
the rights, limitation of rights, obligations, duties and immunities thereunder
of the Company and the holders (the words "holders" or "holder" meaning the
registered holders or registered holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of
certain events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
provided, however, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the rights
of the holder as set forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange as provided herein,
without any charge except for any tax or other governmental charge imposed in
connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by
this Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such numbered unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as
the absolute owner(s) of this Warrant Certificate (notwithstanding any notation
of ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in
the Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the undersigned has executed this certificate
this __ day of ____________, 1996.
WORLDWIDE ENTERTAINMENT
& SPORTS CORP.
By:__________________________
ATTEST:
By:_________________
Secretary
[FORM OF ELECTION OF ASSIGNMENT]
(To be executed by the registered holder if such holder
desires to transfer the Warrant Certificate.)
FOR VALUE RECEIVED___________________________
hereby sells, assigns and transfers unto _____________________
(Please print name and address of transferee)
this Warrant Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _____________________
Attorney, to transfer the within Warrant Certificate on the books of the
within-named Company, with full power of substitution.
Dated:
Signature_____________________
(Signature must conform in all
respects to the name of holder as
specified on the face of the Warrant
Certificate.)
(Insert Social Security or Other
Identifying Number of Holder)
[FORM OF ELECTION TO PURCHASE]
The undersigned hereby irrevocably elects to exercise the right, represented by
this Warrant Certificate, to purchase:
________ Units
and herewith tenders in payment for such securities a certified or cashier's
check or money order payable to the order of Worldwide Entertainment & Sports
Corp. in the amount of $______, all in accordance with the terms hereof. The
undersigned requests that a certificate for such securities be registered in the
name of ___________________________ whose address is _____________________ and
that such Certificate be delivered to _____________________________________
whose address is
--------------------------------------------------------------.
Dated:
Signature_______________________
(Signature must conform in all
respects to the name of holder as
specified on the face of the Warrant
Certificate.)
(Insert Social Security or Other
Identifying Number of Holder)
