THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE
EXERCISE HEREOF CAN BE TRANSFERRED ONLY IN COMPLIANCE WITH THE
SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE
SECURITIES LAWS. THIS WARRANT AND SUCH SHARES MAY NOT BE SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT, UNLESS, IN THE OPINION OF COUNSEL TO THE
COMPANY, SUCH REGISTRATION IS NOT THEN REQUIRED.
JWCHARLES FINANCIAL SERVICES, INC.
000 Xxxxx Xxxxxxx Xxxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
COMMON STOCK PURCHASE WARRANT
Date of Issuance: Right to Purchase
_______________ ___, 1996 25,000 Shares
Expiration Date:
December 31, 2002
THIS CERTIFIES THAT, for value received, the person named
immediately below,
SUNTRUST BANKS, INC.
or the registered assigns of such person (the "Registered
Holder"), is entitled to purchase from JWCHARLES FINANCIAL
SERVICES, INC., a Florida corporation (the "Company"), the number
of shares of the Company's common stock, $.001 par value per
share, set forth above, subject to adjustment pursuant to Section
5 hereof, at the Exercise Price (as defined in subsection 3.1)
per Share, subject to adjustment as set forth in Section 4 hereof
(the "Exercise Price').
The amount and kind of securities purchasable pursuant to
the rights granted under this Warrant and the purchase price for
such securities are subject to adjustment pursuant to the
provisions contained in this Warrant. This Warrant is also
subject to the following provisions:
1.
Certain Definitions
-------------------
As used in this Warrant, the following terms have the
meanings set forth below:
"Affiliate" means any corporation directly under common
control with the Registered Holder.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means the Company's common stock, $.001 par
value per share, as constituted on the Date of Issuance.
However, upon the occurrence of certain events prescribed herein
that affect the Common Stock otherwise issuable upon exercise of
this Warrant, Common Stock shall mean Warrant Stock.
"Common Stock Deemed Outstanding" means, at any given time,
the Weighted Average Common Stock Outstanding plus the number of
shares of Common Stock deemed to be outstanding pursuant to
Section 3 of this Warrant
"Date of Issuance" is the date set forth on the front page
of this Warrant, and the terms "date hereof," "date of this
Warrant," and similar expressions shall be deemed to refer to the
Date of Issuance of this Warrant.
"Exercise Period" means the period of time commencing on the
Date of Issuance and ending at 12:00 Midnight, Eastern Time, on
December 31, 2002.
"GAAP" means generally accepted accounting principles as
applied in the United States and on a basis with respect to the
Company that is consistent for or within each period affected.
"Market Price" means as to any security (i) the average of
the closing prices of such security's sales on the principal
domestic securities exchange on which such security may at the
time be listed (but only if such exchange, as opposed to The
Nasdaq Stock Market, is the principal trading market for such
security), or (ii) if there have been no sales on any such
exchange on any day, the average of the highest bid and lowest
asked prices on such exchange at the end of such day, or (iii) if
on any day such security is not so listed and traded, the average
of the representative bid and asked prices quoted in The Nasdaq
Stock Market as of the close of trading in New York City on such
day, or, if on any day such security is not quoted in The Nasdaq
Stock Market, the average of the high and low bid and asked
prices on such day in the domestic over-the-counter market as
reported by the National Quotation Bureau, Incorporated, or any
similar successor organization, in each such case averaged over a
period of 20 consecutive business days consisting of the business
day immediately preceding the day as of which "Market Price" is
being determined and the 19 consecutive business days prior to
such day; provided that if such security is listed on any
domestic securities exchange or quoted in The Nasdaq Stock
Market, the term "business day" or "business days" as used in
this sentence means a day or days, as applicable, on which such
exchange or The Nasdaq Stock Market is open for trading or
quotation, as the case may be. If at any time such security is
not listed on any domestic securities exchange or quoted in The
Nasdaq Stock Market or the domestic over-the-counter market, the
"Market Price" will be the fair value thereof determined jointly
by the Company and the Registered Holder; provided that if such
parties are unable to reach agreement, such fair value will be
determined by an appraiser jointly selected by the Company and
the Registered Holder.
-2-
"The Nasdaq Stock Market" means the Nasdaq Inter-Dealer
Quotation System or such other similar inter-dealer quotation
system as may in the future be used generally by members of the
National Association of Securities Dealers, Inc. for
over-the-counter transactions in securities.
"Person" means an individual, a partnership, a corporation,
a trust, a joint venture, an unincorporated organization, and a
government or any department or agency thereof.
"Warrant Stock" means shares of the Company's authorized but
unissued Common Stock issued or issuable upon exercise of this
Warrant or any other of the Warrants; provided that if there is a
change such that the securities issuable upon exercise of a
Warrant are issued by an entity other than the Company, or there
is a change in the class of securities so issuable, then the term
"Warrant Stock" will mean one share of the security issuable upon
exercise of the Warrant if such security is issuable in shares,
or will mean the smallest unit in which such security is issuable
if such security is not issuable in shares.
"Warrant" mean this Warrant providing for the purchase of up
to 25,000 shares of Common Stock, subject to adjustment as
provided herein, and all common stock purchase warrants issued in
exchange or substitution for this Warrant or any such other
common stock purchase warrant issued pursuant to the terms hereof
or thereof, as the case may be.
"Weighted Average Common Stock Outstanding" means, at any
given time, the number of shares of Common Stock deemed to be
outstanding in accordance with GAAP as of the end of the
Company's most recent fiscal quarter ended.
2.
Exercise of Warrant
-------------------
2.1 Exercise Period. The Registered Holder may exercise
this Warrant, in whole or in part (but not as to a fractional
share), at any time and from time to time, during the Exercise
Period.
2.2 Exercise Procedure.
(a) This Warrant will be deemed to have been exercised
at such time as the Company has received all of the following
items (the "Exercise Date"):
(i) a completed Exercise Agreement, as described
below, executed by the Registered Holder
exercising all or part of the purchase rights
represented by this Warrant;
(ii) this Warrant (subject to delivery by the Company
of a new Warrant with respect to any unexercised
portion, as provided in Section 2.2(b)); and
-3-
(iii) a certified check or other certified funds
payable to the Company in an amount equal to the
product of the Exercise Price multiplied by the
number of shares of Warrant Stock being purchased
upon such exercise.
(b) Certificates for shares of Warrant Stock purchased
upon exercise of this Warrant will be delivered by the Company to
the Registered Holder within ten days after the Exercise Date.
Unless this Warrant has expired or all of the purchase rights
represented hereby have been exercised, the Company will prepare
a new Warrant representing the rights formerly represented by
this Warrant that have not expired or been exercised. The
Company will, within such ten-day period, deliver such new
Warrant to the Registered Holder.
(c) The Warrant Stock issuable upon the exercise of
this Warrant will be deemed to have been issued to the Registered
Holder on the Exercise Date, and the Registered Holder will be
deemed for all purposes to have become the record holder of such
Warrant Stock on the Exercise Date.
(d) The issuance of certificates for shares of Warrant
Stock upon exercise of this Warrant will be made without charge
to the Registered Holder for any issuance tax in respect thereof
or any other cost incurred by the Company in connection with such
exercise and the related issuance of shares of Warrant Stock;
provided, however, that the Company shall not be required to pay
any tax that may be payable in respect of any transfer involved
in the issuance and delivery of any certificate or instrument in
a name other than that of the Registered Holder of this Warrant,
and the Company shall not be required to issue or deliver any
such certificate or instrument unless and until the Person or
Persons requesting the issue 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.
(e) The Company will not close its books for the
transfer of this Warrant or of any of the securities issuable
upon the exercise of this Warrant in any manner that interferes
with the timely exercise of this Warrant. The Company will from
time to time take all such action as may be necessary to assure
that the par value per share of the unissued Warrant Stock
acquirable upon exercise of this Warrant is at all times equal to
or less than the Exercise Price then in effect.
2.3 Exercise Agreement. The Exercise Agreement will be
substantially in the form set forth as Exhibit I hereto.
2.4 Fractional Shares. If a fractional share of Warrant
Stock would be issuable upon exercise of the rights represented
by this Warrant, the Company will, within 20 days after the
Exercise Date, deliver to the Registered Holder a check payable
to the Registered Holder, in lieu of such fractional share, in an
amount equal to the Market Price of such fractional share as of
the close of business on the Exercise Date.
-4-
3.
Exercise Price
--------------
3.1 General.
(a) The exercise price per Share shall be $10.00. In
order to prevent dilution of the rights granted under this
Warrant, the Exercise Price will also be subject to adjustment
from time to time pursuant to this Section 3.
(b) If and whenever the Company issues or sells, or in
accordance with subsection 3.2 is deemed to have issued or sold,
any shares of its Common Stock for a consideration per share less
than the lesser of ninety percent (90%) of the Market Price per
share of Common Stock, on the one hand, and the Exercise Price in
effect immediately prior to the time of such issuance or sale, on
the other hand (such lesser price being hereinafter referred to
as the "Antidilution Strike Price"), then immediately upon such
issuance or sale the Exercise Price will be reduced to a price
determined by multiplying the Exercise Price in effect
immediately prior to the issuance or sale by a fraction, the
numerator of which shall be the sum of (i) the number of shares
of Common Stock outstanding prior to the issuance or sale plus
(ii) the number of shares of Common Stock (in terms of Warrant
Stock issuable upon an exercise of this Warrant) that the maximum
aggregate amount receivable by the Company upon such issuance or
sale would purchase at the Antidilution Strike Price effective
immediately prior to the issuance or sale, and the denominator of
which shall be the number of shares of Common Stock Deemed
Outstanding immediately after such issuance or sale.
(c) The following securities or transactions shall be
excluded from the operation of paragraph (b) of this subsection
3.1 and subsection 3.2:
(i) The existence and any exercise of any option,
warrant, or other right to purchase Common Stock,
or the conversion into or exchange for Common
Stock of any security of the Company, that is
outstanding on the Issuance Date.
(ii) Any grant or exercise of options for Common Stock
under the Company's 1990 Stock Option Plan.
3.2 Effect on Exercise Price of Certain Events. For
purposes of determining the adjusted Exercise Price under
subsection 3.1 above, the following provisions will be
applicable:
(a) Issuance of Rights or Options. If the Company in any
manner grants any rights or options to subscribe for or to
purchase Common Stock or any stock or other securities
convertible into or exchangeable for Common Stock (such rights or
options being herein called "Options" and such convertible or
exchangeable stock or securities being herein called "Convertible
Securities") and the price per share for which Common Stock is
issuable upon the exercise of such Options or upon conversion or
exchange of such Convertible Securities is less than the
Antidilution Strike Price effective immediately prior to the time
-5-
of the granting of such Options, then the total maximum number of
shares of Common Stock issuable upon the exercise of such Options
or upon conversion or exchange of the total maximum amount of
such Convertible Securities issuable upon the exercise of such
Options will be deemed to be outstanding and to have been issued
and sold by the Company for such price per share. For purposes
of this paragraph, the "price per share for which Common Stock is
issuable upon exercise of such Options or upon conversion or
exchange of such Convertible Securities" will be determined by
dividing (i) the total amount, if any, received or receivable by
the Company as consideration for the granting of such Options,
plus the minimum aggregate amount of additional consideration
payable to the Company upon exercise of all such Options, plus,
in the case of Options that relate to Convertible Securities, the
minimum aggregate amount of additional consideration, if any,
payable to the Company upon the issuance or sale of such
Convertible Securities and the conversion or exchange thereof, by
(ii) the total maximum number of shares of Common Stock issuable
upon the exercise of such Options or upon the conversion or
exchange of all Convertible Securities issuable upon the exercise
of such Options. Except as otherwise provided in paragraphs (c)
and (d) below, no adjustment of the Exercise Price will be made
when Convertible Securities are actually issued upon the exercise
of such Options or when Common Stock is actually issued upon the
exercise of such Options or the conversion or exchange of such
Convertible Securities.
(b) Issuance of Convertible Securities. If the
Company in any manner issues or sells any Convertible Securities,
and the price per share for which Common Stock is issuable upon
such conversion or exchange is less than the Antidilution Strike
Price effective immediately prior to the time of such issuance or
sale, then the maximum number of shares of Common Stock issuable
upon conversion or exchange of all such Convertible Securities
will be deemed to be outstanding and to have been issued and sold
by the Company for such price per share. For the purposes of
this paragraph, the "price per share for which Common Stock is
issuable upon such conversion or exchange" will be determined by
dividing (i) the total amount received or receivable by the
Company as consideration for the issuance or sale of such
Convertible Securities, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the
conversion or exchange thereof, by (ii) the total maximum number
of shares of Common Stock issuable upon the conversion or
exchange of all such Convertible Securities. Except as otherwise
provided in paragraphs (c) and (d) below, no adjustment of the
Exercise Price will be made when Common Stock is actually issued
upon the conversion or exchange of such Convertible Securities,
and if any such issuance or sale of such Convertible Securities
is made upon exercise of any Options for which adjustments of the
Exercise Price had been or are to be made pursuant to other
provisions of this Section 3, no further adjustment of the
Exercise Price will be made by reason of such issuance or sale.
(c) Change in Option Price or Conversion Rate. If the
purchase price provided for in any Options, the additional
consideration, if any, payable upon the conversion or exchange of
any Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exchangeable for Common Stock
changes at any time (other than under or by reason of provisions
that are designed to protect against dilution of the type set
-6-
forth in this Section 3 and that have no more favorable effect on
the holders of such Options or Convertible Securities than this
Section 3 would have if this Section 3 were included in such
Options or Convertible Securities), then the Exercise Price in
effect at the time of such change will be readjusted to the
Exercise Price that would have been in effect at such time had
such Options or Convertible Securities still outstanding provided
for such changed purchase price, additional consideration, or
changed conversion rate, as the case may be, at the time
initially granted, issued, or sold; such adjustment of the
Exercise Price will be made whether the result thereof is to
increase or reduce the Exercise Price then in effect under this
Warrant, provided that no such adjustment shall increase the
Exercise Price above the initial Exercise Price hereof.
(d) Treatment of Terminated or Expired Options and
Convertible Securities. Upon the expiration or the termination
of any Option or of any right to convert or exchange any
Convertible Security, without the exercise of such Option or
right, the Exercise Price then in effect hereunder will be
adjusted to the Exercise Price that would have been in effect at
the time of such expiration or termination had such Option or
Convertible Security never been issued, but such subsequent
adjustment shall not affect the number of shares of Common Stock
issued upon any exercise of this Warrant prior to the date such
adjustment is made.
(e) Calculation of Consideration Received. If any
Common Stock, Options, or Convertible Securities are issued or
sold or deemed to have been issued or sold for consideration that
includes cash, then the amount of cash consideration actually
received by the Company will be deemed to be the cash portion
thereof. If any Common Stock, Options, or Convertible Securities
are issued or sold or deemed to have been issued or sold for a
consideration part or all of which is other than cash, then the
amount of the consideration other than cash received by the
Company will be the fair value of such consideration, except
where such consideration consists of securities, in which case
the amount of consideration received by the Company will be the
Market Price thereof as of the date of receipt. If any Common
Stock, Options, or Convertible Securities are issued in
connection with any merger or consolidation in which the Company
is the surviving corporation, then the amount of consideration
therefor will be deemed to be the fair value of such portion of
the net assets and business of the non-surviving corporation as
is attributable to such Common Stock, Options, or Convertible
Securities, as the case may be.
(f) Integrated Transactions. If any Option is issued
in connection with the issuance or sale of other securities of
the Company, together comprising one integrated transaction in
which no specific consideration is allocated to such Option by
the parties thereto, the Option will be deemed to have been
issued without consideration.
(g) Treasury Shares. The number of shares of Common
Stock Deemed Outstanding at any given time does not include
shares owned or held by or for the account of the Company, and
the disposition of any shares so owned or held will be considered
an issuance or sale of Common Stock.
3.3 Subdivision or Combination of Common Stock; and Stock
Dividends, Etc. If the Company shall at any time after the date
hereof (a) issue any shares of Common Stock or Convertible
-7-
Securities, or any rights to purchase Common Stock or Convertible
Securities, as a dividend or other distribution upon Common
Stock, (b) issue any shares of Common Stock, in subdivision of
outstanding shares of Common Stock by reclassification or
otherwise, or (c) combine outstanding shares of Common Stock, by
reclassification or otherwise, then the Exercise Price that would
apply if purchase rights hereunder were being exercised
immediately prior to such action by the Company shall be adjusted
by multiplying it by a fraction, the numerator of which shall be
the number of shares of Weighted Average Common Stock Outstanding
immediately prior to such dividend or other distribution,
subdivision, or combination and the denominator of which shall be
the number of shares of Weighted Average Common Stock Outstanding
immediately after such dividend, subdivision, or combination.
3.4 Certain Dividends or Distributions. If the Company
shall declare a dividend or other distribution upon the Common
Stock payable otherwise than out of earnings or earned surplus
and otherwise than in Common Stock or Convertible Securities, the
Exercise Price that would apply if purchase rights under the
Warrants were being exercised immediately prior to the
declaration of such dividend or distribution shall be reduced by
an amount equal, in the case of a dividend or other distribution
in cash, to the amount thereof payable per share of the Common
Stock or, in the case of any other dividend or distribution, to
the fair value of such dividend or distribution per share of the
Common Stock as determined in good faith by the Board of
Directors of the Company. For purposes of the foregoing, a
dividend or distribution other than in cash shall be considered
payable out of earnings or earned surplus only to the extent that
such earnings or earned surplus are charged with an amount equal
to the fair value of such dividend or distribution as determined
in good faith by the Board of Directors of the Company. Such
reductions shall take effect as of the date on which a record is
taken for the purpose of such dividend or distribution, or, if a
record is not taken, the date as of which the holders of Common
Stock of record entitled to such dividend or distribution are to
be determined.
3.5 No De Minimis Adjustments. No adjustment of the
Exercise Price shall be made if the amount of such adjustment
would be less than five cents per share, but in such case any
adjustment that otherwise would be required to be made shall be
carried forward and shall be made at the time and together with
the next subsequent adjustment that, together with any adjustment
or adjustments so carried forward, shall amount to not less than
five cents per share.
4.
Adjustment of Number of
-----------------------
Shares Issuable upon Exercise
-----------------------------
If the Company issues or sells, or, in accordance with
Section 3 hereof, is deemed to have issued or sold, any shares of
its Common Stock for a consideration per share below the
Antidilution Strike Price, then upon each adjustment of the
Exercise Price pursuant to Section 3 hereof, the Registered
Holder of this Warrant shall thereafter (until another such
adjustment) be entitled to purchase, at the adjusted Exercise
Price in effect on the date purchase rights under this Warrant
are exercised, the number of shares of Warrant Stock, calculated
-8-
to the nearest 1/100th share, determined by (a) multiplying the
number of shares of Warrant Stock purchasable hereunder
immediately prior to the adjustment of the Exercise Price by the
Exercise Price in effect immediately prior to such adjustment,
and (b) dividing the product so obtained by the adjusted Exercise
Price in effect on the date of such exercise. The provisions of
subsection 2.4 shall apply, however, so that no fractional share
of Warrant Stock shall be issued upon exercise of this Warrant.
5.
Effect of Reorganization, Reclassification
------------------------------------------
Consolidation, Merger, or Sale
------------------------------
If at any time while this Warrant is outstanding there shall
be any reorganization or reclassification of the capital stock of
the Company (other than a subdivision or combination of shares
provided for in subsection 3.3 hereof), any consolidation or
merger of the Company with another corporation (other than a
consolidation or merger in which the Company is the surviving
entity and which does not result in any change in the Common
Stock), or any sale or other disposition by the Company of all or
substantially all of its assets to any other corporation, then
the Registered Holder of this Warrant shall thereafter upon
exercise of this Warrant be entitled to receive the number of
shares of stock or other securities or property of the Company,
or of the successor corporation resulting from such consolidation
or merger, as the case may be, to which the Common Stock (and any
other securities and property) of the Company, deliverable upon
the exercise of this Warrant, would have been entitled upon such
reorganization, reclassification of capital stock, consolidation,
merger, sale, or other disposition if this Warrant had been
exercised immediately prior to such reorganization,
reclassification of capital stock, consolidation, merger, sale,
or other disposition. In any such case, appropriate adjustment
(as determined in good faith by the Board of Directors of the
Company) shall be made in the application of the provisions set
forth in this Warrant with respect to the rights and interests
thereafter of the Registered Holder of this Warrant to the end
that the provisions set forth in this Warrant (including those
relating to adjustments of the Exercise Price and the number of
shares issuable upon the exercise of this Warrant) shall
thereafter be applicable, as near as reasonably may be, in
relation to any shares or other property thereafter deliverable
upon the exercise hereof as if this Warrant had been exercised
immediately prior to such reorganization, reclassification of
capital stock, consolidation, merger, sale, or other disposition
and the Registered Holder hereof had carried out the terms of the
exchange as provided for by such reorganization, reclassification
of capital stock, consolidation, or merger. If in any such
reorganization, reclassification, consolidation, or merger,
additional shares of Common Stock shall be issued in exchange,
conversion, substitution, or payment, in whole or in part, for or
of a security of the Company other than Common Stock, any such
issue shall be treated as an issue of Common Stock covered by the
provisions of Section 3, with the amount of the consideration
received upon the issue thereof being determined in good faith by
the Board of Directors of the Company. The Company shall not
effect any such reorganization, consolidation, or merger unless,
upon or prior to the consummation thereof, the successor
corporation shall assume by written instrument the obligation to
deliver to the Registered Holder hereof such shares of stock or
-9-
other securities, cash, or property as such Holder shall be
entitled to purchase in accordance with the foregoing provisions.
Notwithstanding any other provisions of this Warrant, in the
event of sale or other disposition of all or substantially all of
the assets of the Company as a part of a plan for liquidation of
the Company, all rights to exercise the Warrant shall terminate
60 days after the Company gives written notice to the Registered
Holder of this Warrant that such sale or other disposition has
been consummated.
6.
Notice of Adjustment
--------------------
Immediately upon any adjustment of the Exercise Price, or
increase or decrease in the number of shares of Common Stock
purchasable upon exercise of this Warrant, the Company will send
written notice thereof to the Registered Holder, stating the
adjusted Exercise Price and the increased or decreased number of
shares purchasable upon exercise of this Warrant and setting
forth in reasonable detail the method of calculation for such
adjustment and increase or decrease. When appropriate, such
notice may be given in advance and included as part of any notice
required to be given pursuant to Section 7 below.
7.
Prior Notice of Certain Events
------------------------------
If at any time:
(a) the Company shall pay any dividend payable in
stock upon its Common Stock or make any distribution (other
than cash dividends) to the holders of its Common Stock;
(b) the Company shall offer for subscription pro rata
to the holders of its Common Stock any additional shares of
stock of any class or any other rights;
(c) there shall be any reorganization or
reclassification of the capital stock of the Company, any
consolidation or merger of the Company with another
corporation (other than a direct or indirect subsidiary of
the Company), or a sale or disposition of all or
substantially all its assets; or
(d) there shall be a voluntary or involuntary
dissolution, liquidation, or winding up of the Company,
then, in each such case, the Company shall give prior written
notice, by hand delivery or by certified mail, postage prepaid,
addressed to the Registered Holder of this Warrant at the address
of such holder as shown on the books of the Company, of the date
on which (i) the books of the Company shall close or a record
shall be taken for such stock dividend, distribution, or
subscription rights or (ii) such reorganization,
reclassification, consolidation, merger, sale, dissolution,
liquidation, or winding up shall take place, as the case may be.
A copy of each such notice shall be sent simultaneously to each
transfer agent of the Company's Common Stock. Such notice shall
also specify the date as of which the holders of Common Stock of
record shall participate in said dividend, distribution, or
subscription rights or shall be entitled to exchange their Common
-10-
Stock for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation, or winding up, as the case may be.
Such written notice shall be given at least 30 days prior to the
record date or the effective date, whichever is earlier, of the
subject action or other event.
8.
Reservation of Common Stock
---------------------------
The Company will at all times reserve and keep available for
issuance upon the exercise of Warrants such number of its
authorized but unissued shares of Common Stock as will be
sufficient to permit the exercise in full of all outstanding
Warrants, and upon such issuance such shares of Common Stock will
be validly issued, fully paid, and nonassessable.
9.
No Stockholder Rights or Obligation
-----------------------------------
This Warrant will not entitle the holder hereof to any
voting rights or other rights as a stockholder of the Company.
No provision of this Warrant, in the absence of affirmative
action under Section 2.2 hereof by the Registered Holder to
purchase Warrant Stock, and no enumeration in this Warrant of the
rights or privileges of the Registered Holder, will give rise to
any obligation of such Holder for the Exercise Price of Warrant
Stock acquirable by exercise hereof or as a stockholder of the
Company.
10.
Non-transferability
-------------------
This Warrant and all rights hereunder are not transferable,
in whole or in part, except to an Affiliate. The Warrant Stock
issued upon exercise hereof may not be offered, sold, or
transferred except in compliance with the Securities Act of 1933,
as amended (the "Act"), and any applicable state securities laws,
and then only against receipt of an agreement of the Person to
whom such offer or sale is made to comply with the provisions of
this Section 10 with respect to any resale or other disposition
of such securities; provided that no such agreement shall be
required from any Person purchasing any security underlying this
Warrant pursuant to a registration statement effective under the
Act. The Registered Holder of this Warrant agrees that, prior to
the disposition of any security purchased on the exercise hereof
under circumstances that might require registration of such
security under the Act, or any similar statute then in effect,
the Registered Holder shall give written notice to the Company,
expressing its intention as to such disposition. Promptly upon
receiving such notice, the Company shall present a copy thereof
to its securities counsel. If, in the opinion of such counsel
(or of other securities counsel reasonably acceptable to the
Company), the proposed disposition does not require registration
of such security under the Act, or any similar statute then in
effect, the Company shall, as promptly as practicable, notify the
Registered Holder of such opinion, whereupon the Registered
Holder shall be entitled to dispose of such security in
-11-
accordance with the terms of the notice delivered by the
Registered Holder to the Company. The above agreement by the
Registered Holder of this Warrant shall not be deemed to limit or
restrict in any respect the exercise of rights set forth in
Section 11 hereof.
11.
Registration Rights
-------------------
11.1 "Piggyback Rights". If at any time during the Exercise
Period, the Company shall prepare and file one or more
registration statements under the Act with respect to a public
offering of equity or debt securities of the Company, or of any
such securities of the Company held by its security holders, the
Company will include in any such registration statement such
information as is required, and such number of the Warrant Stock
issuable, or previously issued and then outstanding, pursuant to
the exercise of this Warrant (collectively, the "Warrant
Securities") held by the Registered Holders thereof or their
respective designees or transferees as may be requested, to
permit a public offering of the Warrant Securities so requested;
provided, however, that if, in the written opinion of the
Company's managing underwriter, if any, for such offering, the
inclusion of the Warrant Securities requested to be registered,
when added to the securities being registered by the Company or
the selling security holder(s), would exceed the maximum amount
of the Company's securities that can be marketed without
otherwise materially and adversely affecting the entire offering,
then the Company may exclude from such offering all or any
portion of the Warrant Securities requested to be so registered,
but only if no securities are included in such registration
statement other than securities being sold for the account of the
Company or by Persons pursuant to the exercise of "demand"
registration rights or of "piggyback" registration rights granted
prior to the Issuance Date which are expressly senior to those of
the Registered Holder, and then only on a pro rata basis with
respect to all securities not being sold by the Company or by
Persons exercising such "demand" or senior "piggyback"
registration rights.. The Company shall bear all fees and
expenses incurred by it in connection with the preparation and
filing of such registration statement. In the event of such a
proposed registration, the Company shall furnish the then
Registered Holders of Warrant Securities with not less than
thirty (30) days' written notice prior to the proposed or
expected effectiveness date of such registration statement. Such
notice shall continue to be given by the Company to Registered
Holders of Warrant Securities, with respect to subsequent
registration statements filed by the Company, until such time as
all of the Warrant Securities have been registered or may be sold
by the Registered Holders thereof without registration under the
Act or applicable state securities laws and regulations, and
without limitation as to volume, pursuant to Rule 144 of the Act
or any succeeding provision. The holders of Warrant Securities
shall exercise the rights provided for in this subsection 11.1 by
giving written notice to the Company, within twenty (20) days of
receipt of the Company's notice provided for herein.
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11.2 Certain Procedures and Requirements of Registered Holder.
---------------------------------------------------------
(a) Information to be Furnished by Registered Holder. In
connection with the registration of the Warrant Securities, and
as a condition to the Company's obligations under subsection
11.1, the Registered Holder will furnish to the Company in
writing such information with respect to such Registered Holder
and its proposed disposition as shall be reasonably necessary in
order to assure compliance with the Act and with other federal
and applicable state securities laws. Without limiting the
generality of the foregoing, in connection with an underwritten
public offering, such Registered Holder electing such method of
disposition agrees to enter into, as required, a written
agreement with the managing underwriter in such form and
containing such provisions as is customary in the securities
business for such an arrangement, and to complete and execute all
questionnaires, powers of attorney, indemnities, and other
documents or instruments reasonably required under such terms of
the underwriting arrangements.
(b) Expenses of Registered Holder. All underwriting
discounts and selling commissions applicable to the sale of any
Warrant Securities as well as fees and expenses of any counsel,
accountant, or other advisor to the Registered Holder shall be
borne by the Registered Holder.
(c) Certain Restrictions. Notwithstanding anything to the
contrary contained in this Section 11, if there is a firm
commitment underwritten offering of securities for the Company
pursuant to a registration covering shares of the Warrant
Securities, and if the Registered Holder does not elect to sell
its Warrant Securities to the underwriters of the Company's
securities in connection with such offering, then the Registered
Holder (if requested by the managing underwriter) shall agree to
refrain from selling any of its Warrant Securities that are
otherwise registered pursuant to this Section 11 during the
period in which the underwriting syndicate, as such, participates
in the after-market. Such Registered Holder shall, however, be
entitled to sell such securities, in any event, commencing on the
120th day after the effective date of such registration
statement, if then lawful to do so under applicable securities
laws and rules of the Commission.
(d) Indemnification by Registered Holder. In connection
with a registration of the Warrant Securities under the Act
pursuant to this Section 11, the Company and the Registered
Holder shall enter into customary indemnification agreements with
regard to losses, claims, damages or liabilities arising
therefrom. In addition, if such registration relates to an
underwritten offering, such indemnification agreements shall
include the underwriters thereof as a party thereto.
11.3 Survival. The rights and obligations set forth in this
Section 11 shall survive the exercise and surrender of this
Warrant.
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12.
Miscellaneous
12.1 Amendment and Waiver. Except as otherwise provided
herein, the provisions of the Warrant may be amended, and the
Company may take any action herein prohibited or omit to perform
any act herein required to be performed by it, only if the
Company has obtained the prior written consent of the Registered
Holder.
12.2 Notices. Any notices required to be sent to a
Registered Holder of this Warrant or of any Warrant Stock
purchased upon the exercise hereof will be delivered to the
address of such Registered Holder shown on the books of the
Company. All notices referred to herein will be delivered in
person or sent by registered or certified mail, postage prepaid,
and will be deemed to have been given when so delivered in person
or on the third business day following the date so sent by mail.
12.3 Descriptive Headings; Governing Law. The descriptive
headings of the sections and paragraphs of this Warrant are
inserted for convenience only and do not constitute a part of
this Warrant. The construction, validity, and interpretation of
this Warrant will be governed by the laws of the State of
Florida.
IN WITNESS WHEREOF, the Company has caused this Warrant to
be executed and attested by its duly authorized officers under
its corporate seal.
JWCHARLES FINANCIAL SERVICES, INC.
[SEAL] By:________________________________
Name:_________________________
Title:________________________
Attest:
________________________________
Secretary or Assistant Secretary
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EXHIBIT I
EXERCISE AGREEMENT
To: Dated:
The undersigned Record Holder, pursuant to the
provisions set forth in the within Warrant, hereby subscribes for
and purchases _____ shares covered by such Warrant and herewith
makes full cash payment of $__________________ for such Warrant
Stock at the Exercise Price provided by such Warrant.
______________________________
(Signature)
______________________________
(Print or type name)
______________________________
(Address)
______________________________
______________________________
NOTICE: The signature on this Exercise Agreement must
correspond with the name as written upon the face of the within
Warrant, in every particular, without alteration, enlargement, or
any change whatsoever, and must be guaranteed by a bank, other
than a saving bank, having an office or correspondent in New
York, New York, Boca Raton or Miami, Florida, or Atlanta,
Georgia, or by a firm having membership on a registered national
securities exchange and an office in New York, New York, Boca
Raton or Miami, Florida, or Atlanta, Georgia.
SIGNATURE GUARANTEE
Authorized Signature:____________________________________________
Name of Bank or Firm:____________________________________________
Dated:___________________________________________________________
