EXHIBIT 4.6
THIS WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE
SECURITIES OR BLUE SKY LAWS. EXCEPT AS OTHERWISE SET FORTH HEREIN OR IN AN
AGREEMENT FROM THE HOLDER, NEITHER THIS WARRANT NOR ANY OF SUCH SHARES MAY BE
SOLD, OFFERED FOR SALE, ASSIGNED, TRANSFERRED, OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF REGISTRATION UNDER SUCH ACT OR UNDER APPLICABLE STATE SECURITIES OR
BLUE SKY LAWS OR AN EXEMPTION THEREFROM. THIS WARRANT MAY NOT BE SOLD, ASSIGNED,
TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO THE EXPRESS PROVISIONS
OF THIS WARRANT, AND NO SALE, ASSIGNMENT, TRANSFER, OR OTHER DISPOSITION OF THIS
WARRANT SHALL BE VALID OR EFFECTIVE UNLESS
AND UNTIL SUCH PROVISIONS SHALL HAVE BEEN COMPLIED WITH.
Right to
Purchase
100,000
Shares of
Common Stock,
par value $.10
per share
CLASS C-3 STOCK PURCHASE WARRANT
THIS CERTIFIES THAT, for value received, American Maple Leaf Financial
Corporation (the "Holder") or its registered assigns, is entitled to purchase
from THE EASTWIND GROUP, INC., a Delaware corporation (the "Company"), at any
time or from time to time during the period specified in Paragraph 2 hereof, One
Hundred Thousand (100,000) fully paid and nonassessable shares of the Company's
Common Stock, par value $.10 per share (the "Common Stock"), at an exercise
price of $9.00 per share (the "Exercise Price"). The term "Warrant Shares", as
used herein, refers to the shares of Common Stock purchasable hereunder. The
Warrant Shares and the Exercise Price are subject to adjustment as provided in
Paragraph 4 hereof
This Warrant is subject to the following terms, provisions and conditions:
1. Manner of Exercise; Issuance of Certificates; Payment for Shares.
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Subject to the provisions hereof, this Warrant may be exercised by the holder
hereof, in whole or in part, by the surrender of this Warrant, together with a
complete exercise agreement in the form attached hereto (the "Exercise
Agreement"), to the Company during normal business hours on any business day at
the Company's principal executive offices (or such other office or agency of the
Company as it may designate by notice to the holder hereof), and upon Payment to
the
Company in cash or by certified or official bank check of the Exercise Price
for the Warrant Shares specified in the Exercise Agreement. The Warrant Shares
so purchased shall be deemed to be issued to the holder hereof or such holder's
designee as the record owner of such shares as of the close of business on the
date on which this Warrant shall have been surrendered, the completed Exercise
Agreement delivered, and Payment made for such shares as set forth above.
Certificates for the Warrant Shares so purchased, representing the aggregate
number of shares specified in the Exercise Agreement, shall be delivered to the
holder hereof within a reasonable time, not exceeding five (5) business days,
after this Warrant shall have been so exercised. The certificates so delivered
shall be in such denominations as may be requested by the holder hereof and
shall be registered in the name of such holder or such other name as shall be
designated by such holder. If this Warrant shall have been exercised only in
part, then, unless this Warrant has expired, the Company shall, at its expense,
at the time of delivery of such certificates, deliver to the holder a new
Warrant representing the number of shares with respect to which this Warrant
shall not then have been exercised. The Company shall pay all taxes and other
expenses and charges payable in connection with the preparation, execution, and
delivery of stock certificates (and any new Warrants) pursuant to this Paragraph
1 except that, in case such stock certificates shall be registered in a name or
names other than the holder of this Warrant at the request of such holder, funds
sufficient to pay all stock transfer taxes which shall be payable in connection
with the execution and delivery of such stock certificates shall be paid by the
holder hereof to the Company at the time of the delivery of such stock
certificates by the Company as set forth above.
2. Period of Exercise. Subject to the Company's right to redeem
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this Warrant in accordance with Paragraph 9 below, this Warrant is exercisable
in whole or in part, at any time and from time to time on or after October 7,
1996 and before 5:00 p.m., Eastern time on October 7, 1999.
3. Certain Agreements of the Company. The Company hereby covenants
---------------------------------
and agrees as follows:
(a) Shares to be Fully Paid. All Warrant Shares will, upon issuance,
-----------------------
be validly issued, fully paid, and nonassessable and free from all taxes, liens,
and charges with respect to the issue thereof.
(b) Reservation of Shares. During the Exercise Period, the Company
---------------------
shall at all times have authorized, and reserved for the purpose of issue upon
exercise of this Warrant, a sufficient number of shares of Common Stock to
provide for the exercise of this Warrant.
(c) Certain Actions Prohibited. The Company will not, by amendment of
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its charter or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities, or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms to be
observed or performed by it hereunder, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant and in the
taking of all
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such actions as may reasonably be requested by the holder of this
Warrant in order to protect the exercise privilege of the holder of this Warrant
against dilution or other impairment, consistent with the tenor and purpose of
this Warrant. Without Awaiting the generality of the foregoing, the Company (i)
will not increase the par value of any shares of Common Stock receivable upon
the exercise of this Warrant above the Exercise Price then in effect, and (ii)
will take all such actions as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and nonassessable shares of
Common Stock upon the exercise of this Warrant.
(d) Successors and Assigns. This Warrant will be binding upon any
----------------------
entity succeeding to the Company by merger, consolidation, or acquisition of all
or substantially all the Company's assets.
4. Antidilution Provisions. During the Exercise Period, the
-----------------------
Exercise Price and the number of Warrant Shares shall be subject to adjustment
from time to time as provided in this Paragraph 4; provided, however, that no
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adjustment will be made in the Exercise Price or the Warrant Shares in
connection with the issuance of Common Stock pursuant to this Warrant.
In the event that any adjustment of the Exercise Price as required
herein results in a fraction of a cent, such Exercise Price shall be rounded up
to the nearest cent.
(a) Adjustment of Exercise Price and Number of Shares upon Issuance of
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Common Stock. Except as otherwise provided in Paragraphs 4(c) and 4(d) hereof,
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if and whenever on or after the date of issuance of this Warrant, the Company
issues or sells, or in accordance with Paragraph 4(b) hereof is deemed to have
issued or sold, any shares of Common Stock for no consideration or for a
consideration per share (before deduction of reasonable expenses or commissions
or underwriting discounts or allowances in connection therewith) less than the
then current Market Price (as hereinafter defined) of the Common Stock on the
date the Company fixes the price of such issuance of Common Stock (a "Dilutive
Issuance"), then immediately upon the Dilutive Issuance, the Exercise Price will
be reduced to a price determined by dividing (i) the sum of (x) the product
derived by multiplying the Exercise Price in effect immediately prior to the
Dilutive Issuance times the number of shares of Common Stock Deemed Outstanding
(as hereinafter defined) immediately prior to the Dilutive Issuance, plus (y)
the quotient derived from dividing the aggregate consideration (before deduction
for reasonable expenses or commissions or underwriting discounts or allowances
in connection therewith), calculated as set forth in Section 4(b) hereof,
received by the Company upon such Dilutive Issuance by the Market Price on the
date of issuance; by (ii) the total number of shares of Common Stock Deemed
Outstanding immediately after the Dilutive Issuance. Upon each such adjustment
of the Exercise Price hereunder, the number of shares of Common Stock acquirable
upon exercise of this warrant will be adjusted to the number of shares
determined by multiplying the Exercise Price in effect immediately prior to such
adjustment by the number of shares of Common Stock acquirable upon exercise of
this Warrant immediately prior -to such adjustment and dividing the product
thereof by the Exercise Price resulting from such adjustment.
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(b) Effect on Exercise Price of Certain Events. For purposes of
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determining the adjusted Exercise Price under Paragraph 4(b) hereof, the
following will be applicable:
(i) Issuance of Rights or Options. If the Company in any manner
-----------------------------
issues or grants any rights or options, whether or not immediately exercisable
to subscribe for or to purchase Common Stock or other securities convertible
into or exchangeable for Common Stock ("Convertible Securities") (such rights or
options to purchase Common Stock or Convertible Securities are hereinafter
referred to as "Options") and the price per share for which Common Stock is
issuable upon the exercise of such Options is less than the then current Market
Price of the Common Stock on the date of issuance of such Options, then the
maximum total number of shares of Common Stock issuable upon the exercise of all
such Options will, as of the date of the issuance or grant of such Options, be
deemed to be outstanding and to have been issued and sold by the Company for
such price per share. For purposes of the preceding sentence, the "price per
share for which Common Stock is issuable upon the exercise of such Options" is
determined by dividing (i) the minimum total amount, if any, received or
receivable by the Company as consideration for the issuance or granting of all
such Options, plus the minimum aggregate amount of additional consideration, if
any, payable to the Company upon the exercise of all such Options, plus, in the
case of Convertible Securities issuable upon the exercise of such Options, the
minimum aggregate amount of additional consideration payable upon the conversion
or "change thereof at the time such Convertible Securities first become
convertible or exchangeable, by (ii) the maximum total number of shares of
Common Stock issuable upon the exercise of all such Options. No further
adjustment to the Exercise Price will be made upon the actual issuance of such
Common Stock, upon the exercise of such Options or upon the conversion or
exchange of Convertible Securities issuable upon exercise of such Options.
(ii) Issuance of Convertible Securities. If the Company in
----------------------------------
any manner issues or sells any Convertible Securities, whether or, not
immediately convertible (other than where the same are issuable upon the
exercise of Options) and the price per share for which Common Stock is issuable
upon such conversion or exchange is less than the then Current Market Price of
the Common Stock on the date of issuance of such Convertible Securities then the
maximum total number of shares of Common Stock issuable upon the conversion or
exchange of all such Convertible Securities will, as of the date of the issuance
of such Convertible Securities, be deemed to be outstanding and to have been
issued and sold by the Company for such price per share. For the purposes of
the preceding sentence, the "price per share for which Common Stock is issuable
upon such conversion or exchange" is determined by dividing (i) the minimum
total amount, if any, received or receivable by the Company as consideration for
the issuance or sale of all such Convertible Securities, plus the minimum
aggregate amount of additional consideration, if any, payable to the Company
upon the conversion or exchange thereof at the time such Convertible Securities
first become convertible or exchangeable, by (ii) the maximum total number of
shares of Common Stock issuable upon the conversion or exchange of all such
Convertible Securities. No further adjustment to the
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Exercise Price will be made upon the actual[ issuance of such Common Stock upon
conversion or exchange of such Convertible Securities.
(iii) Change in Option Price or Conversion Rate. If there is
-----------------------------------------
a change at any time in (i) the amount of additional consideration payable to
the Company upon the exercise of any Options; (ii) the amount of additional
consideration, if any, payable to the Company upon the conversion or exchange of
any Convertible Securities; or (iii) the rate at which any Convertible
Securities are convertible into or exchangeable for Common Stock (other than
under or by reason of provisions designed to protect against dilution), the
Exercise Price in effect at the time of such change will be readjusted to the
Exercise Price which would have been in effect at such time had such Options or
Convertible Securities still outstanding provided for such changed additional
consideration or changed conversion rate, as the case may be, at the time
initially granted, issued or sold, and the number of shares of Common Stock
acquirable upon exercise of this Warrant will be correspondingly readjusted.
(iv) Treatment of Expired Options and Unexercised
--------------------------------------------
Convertible Securities. If, in any case, the total number of shares of Common
----------------------
Stock issuable upon exercise of any Option or upon conversion or exchange of any
Convertible Securities is not, in fact, issued and the rights to exercise such
Option or to convert or exchange such Convertible Securities shall have expired
or terminated, the Exercise Price then in effect and the number of shares of
Common Stock acquirable upon exercise of this Warrant, as adjusted, will be
readjusted to the Exercise Price and the number of shares which would have been
in effect at the time of such expiration or termination had such Option or
Convertible Securities, to the extent outstanding immediately prior to such
expiration or termination (other than in respect of the actual number of shares
of Common Stock issued upon exercise or conversion thereof), never been issued.
(v) Calculation of Consideration Received. If any Common Stock,
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Options or Convertible Securities are issued, granted or sold for cash, the
consideration received therefor for purposes of this Warrant will be the amount
received by the Company therefor, before deduction of reasonable commissions,
underwriting discounts or allowances or other reasonable expenses paid or
incurred by the Company in connection with such issuance, grant or !;ale. In
case any Common Stock, Options or Convertible Securities are issued or sold for
a consideration other than cash, 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. In case any Common Stock, Options or Convertible Securities
are issued in connection with any merger or consolidation in which the Company
is the surviving corporation, 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. The fair value of any
consideration other than cash or securities will be determined in good faith by
the Board of Directors of the Company.
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(c) Subdivision or Combination of Common Stock. If the Company at any
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time subdivides (by any stock split, stock dividend, recapitalization,
reorganization, reclassification or otherwise) the shares of Common Stock
acquirable hereunder into a greater number of shares, then, after the date of
record for effecting such subdivision, the Exercise Price in effect immediately
prior to such subdivision will be proportionately reduced and the number of
shares of Common Stock acquirable upon exercise of this Warrant will be
proportionately increased. If the Company at any time combines (by reverse
stock split, recapitalization, reorganization, reclassification or otherwise)
the shares of Common Stock acquirable hereunder into a smaller number of shares,
then, after the date of record for effecting such combination, the Exercise
Price in effect immediately prior to such combination will be proportionately
increased and the number of shares of Common Stock acquirable upon exercise of
this Warrant will be proportionately decreased.
(d) Consolidation, Merger or Sale. In case of any consolidation of
-----------------------------
the Company with, or merger of the Company into any other corporation, or- in
case of any sale or conveyance of all or substantially all of the assets of the
Company other than in connection with a plan of complete liquidation of the
Company, then as a condition of such consolidation, merger or sale or
conveyance, adequate provision will be :made whereby the holder of this Warrant
will have the right to acquire and receive upon exercise of this Warrant in lieu
of the shares of Common Stock immediately theretofore acquirable upon the
exercise of this Warrant, such shares of stock, securities or assets as may be
issued or payable with respect to or in exchange for the number of shares of
Common Stock immediately theretofore acquirable and receivable upon exercise of
this Warrant had such consolidation, merger or sale or conveyance not taken
place. In any such case, the Company will make appropriate provision to insure
that the provisions of this Paragraph 4 hereof will thereafter be applicable as
nearly as may be in relation to any shares of stock or securities thereafter
deliverable upon the exercise of this Warrant. The Company will not effect any
consolidation, merger or sale or conveyance unless prior to the consummation
thereof, the successor corporation (if other than the Company) assumes by
written instrument the obligations under this Paragraph 4 and the obligations to
deliver to the holder of this Warrant such shares of stock, securities or assets
as, in accordance with the foregoing provisions, the holder may be entitled to
acquire.
(e) Distribution of Assets. In case the Company shall declare or make
----------------------
any distribution of its assets to holders of Common Stock as a partial
liquidating dividend, by way of return of capital or otherwise, then, after the
date of record for determining stockholders entitled to such distribution, but
prior to the date of distribution, the holder of this Warrant shall be entitled
upon exercise of this Warrant for the purchase of any or all of the shares of
Common Stock subject hereto, to receive the amount of such assets which would
have been payable to the holder had such holder been the holder of such shares
of Common Stock on the record date for the determination of stockholders
entitled to such distribution.
(f) Notice of Adjustment. Upon the occurrence of any event which
--------------------
requires any adjustment of the Exercise Price, then and in each such case the
Company shall give
-6-
notice thereof to the holder of this Warrant, which notice shall state the
Exercise Price resulting from such adjustment and the increase or decrease, if
any, in the number of Warrant Shares purchasable at such price upon exercise,
setting forth in reasonable detail the method of calculation and the facts upon
which such calculation is based.
(g) Minimum Adjustment of Exercise Price. No adjustment of the
------------------------------------
Exercise Price shall be made in an amount less than 1% of the Exercise Price in.
effect at the time such adjustment is otherwise required to be made, but any
such lesser adjustment shall be carried forward and shall be made at the time
and together with the next subsequent adjustment which, together with any
adjustments so carried forward, shall amount to not less than 1% of such
Exercise Price.
(h) No Fractional Shares. No fractional shares of Common Stock are to
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be issued upon the exercise of this Warrant, but the Company shall pay a cash
adjustment other rights; -in respect of any fractional share which would
otherwise be issuable in an amount equal to the same fraction of the Market
Price of a share of Common Stock on the date of such exercise.
(i) Other Notices. In case at any time:
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(i) the Company shall declare any dividend upon the Common Stock
payable in shares of stock of any class or make any other distribution (other
than dividends or distributions payable in cash out of retained earnings) to the
holders of the Common Stock;
(ii) the Company shall offer for subscription pro rata to
the holders of the Common Stock any additional shares of stock of any class or
(iii) there shall be any capital reorganization of the
Company, or reclassification of the Common Stock, or consolidations or merger of
the Company with or into, or sale of all or substantially all its assets to,
another corporation or entity; or
(iv) there shall be a voluntary or involuntary dissolution,
liquidation winding-up of the Company;
then, in each such case, the Company shall give to the holder of this Warrant
(a) notice of the date on which the books of the Company shall close or a record
:shall be taken for determining the holders of Common Stock entitled to receive
any such dividend, distribution, or subscription rights or for determining the
holders of Common Stock entitled to vote in respect of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding-up and (b) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding-up, notice of
the date (or, if not then known, a reasonable approximation thereof by the
Company) when the same shall take place. Such notice shall also specify the
date on which the holders of Common Stock shall be entitled to receive such
-7-
dividend, distribution, or subscription rights or to exchange their Common Stock
for stock or other securities or property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation, or
winding-up, as the case may be. Such notice shall be given at least 30 days
prior to the record date or the date on which the Company's books art-, closed
in respect thereto. Failure to give any such notice or any defect therein shall
not affect the validity of the proceedings referred to in clauses (i), (ii),
(iii) and (iv) above.
(j) Certain Events. If any event occurs of the type contemplated by
--------------
the adjustment provisions of this Paragraph 4 but not expressly provided for by
such provisions, the Company will give notice of such event as provided in
Paragraph 4(f) hereof, and the Company's Board of Directors will make an
appropriate adjustment in the Exercise Price and the number of shares of Common
Stock acquirable upon exercise of this Warrant so that the rights of the Holder
shall be neither enhanced nor diminished by such event.
(k) Certain Definitions.
-------------------
(i) "Common Stock Deemed Outstanding" shall mean the number of shares
---------------------------------
of Common Stock actually outstanding (not including shares of Common Stock held
in the treasury of the Company), plus (x) pursuant to Paragraph 4(b)(i) hereof,
the maximum total number of shares of Common Stock issuable upon the exercise of
Options, as of the date of such issuance or grant of such Options, if any, and
(y) pursuant to Paragraph 4(b)(ii) hereof, the maximum total number of shares of
Common Stock issuable upon conversion or exchange of Convertible Securities, as
of the date of issuance of such Convertible Securities, if any.
(ii) "Market Price" of any security shall be as follows: If
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such shares are listed or admitted to trading on one or more national securities
exchanges, the average of the last reported sales prices per share or, in case
no such reported sales take place, the average of the last reported bid and
asked prices per share, in either case on the principal national securities
exchange on which such shares are listed or admitted to trading, for the five
(5) trading days immediately preceding the closing date of the transaction
pursuant to which the securities for which the market price determination is
being made were issued, sold or otherwise transferred (the "Determination
Date"); if such shares are not listed or admitted to trading on a national
securities exchange, but are quoted on a regular (and not sporadic) basis by the
NASD Automatic Quotation System ("NASDAQ"), the average of the last reported
sales prices per share for the five (5) trading days immediately preceding the
Determination Date, as furnished by the National Quotation Bureau Incorporated
or such other nationally recognized quotation service as may be selected by the
Company if such Bureau is not at the time furnishing quotations; and if the
securities are not (i) listed or admitted to trading on a national securities
exchange or (ii) quoted by NASDAQ on a regular (and not sporadic) basis, the
market price will be the fair market value thereof determined in good faith by
the Board of Directors of the Company or, if the holder shall object in writing
to such Board determination within twenty (20) days after it is rendered, fair
market value shall be determined in good faith by an independent investment
banking firm selected jointly by the holder and the Board of Directors of the
Company, or if such
-8-
selection cannot be made, by an independent investment banking firm selected by
the American Arbitration Association in accordance with its rules. All costs of
determining fair market value subsequent to an objection by the holder as
contemplated in the immediately preceding sentence shall be home by the holder;
provided, however, if the fair market value determined in accordance with the
immediately preceding sentence subsequent to an objection by the holder is at
least 15% less than the fair market value determined in. good faith by the Board
of Directors of the Company, such costs shall be borne by the Company.
(iii) "Common Stock," for purposes of this Paragraph 4,
---------------
includes the Common Stock, par value $.10, and any additional class of stock of
the Company having no preference as to dividends or distributions on
liquidation, provided that the shares purchasable pursuant to this Warrant shall
include only shares of Common Stock, par value $.10, ]in respect of which this
Warrant is exercisable, or shares resulting from any subdivision or combination
of such Common Stock, or in the case of any reorganization, reclassification,
consolidation, merger, or sale of the character referred to in Paragraph 4(d)
hereof, the stock or other securities or property provided for in such
Paragraph.
5. Issue Tax. The issuance of certificates for Warrant Shares upon
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the exercise of this Warrant shall be made without charge to the holder of this
Warrant or such shares for any issuance tax in respect thereof, provided 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 certificate
in a name other than the holder of this Warrant.
6. No Rights or Liabilities as a Shareholder. This Warrant shall
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not entitle the holder hereof to any voting rights or other rights as a
shareholder of the Company. No provision of this Warrant in the absence of
affirmative action by the holder hereof to purchase Warrant Shares, and no mere
enumeration herein of the rights or privileges of the holder hereof, shall give
rise to any liability of such holder for the Exercise Price or as a shareholder
of the Company, whether such liability is asserted by this Company or by
creditors of the Company.
7. Transfer, Exchange, and Replacement of Warrant.
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(a) Restriction on Transfer. This Warrant and the rights granted to
-----------------------
the holder hereof are transferable, in whole or in part, only with the prior
written consent of Company, and then upon surrender of this Warrant, together
with a properly executed assignment in the form attached hereto, at the office
or agency of the Company referred to in Paragraph 7(e) below, provided, however,
that any transfer or assignment shall be subject to the conditions set forth in
Paragraph 7(f) hereof. Until due presentment for registration of transfer on
the books of the Company, the Company may treat the registered holder hereof as
the owner and holder hereof for all purposes and the Company shall not be
affected by any notice to the contrary.
(b) Warrant Exchangeable for Different Denominations. This Warrant is
------------------------------------------------
exchangeable, upon the surrender hereof by the holder hereof at the office or
agency of the
-9-
Company referred to in Paragraph 7(e) below, for new Warrants of like tenor
representing in the aggregate the right to purchase the number of shares of
Common Stock which may be purchased hereunder, each of such new Warrants to
represent the right to purchase such number of shares as shall be designated by
the holder hereof at the time of such surrender.
(c) Replacement of Warrant. Upon receipt of evidence reasonably
----------------------
satisfactory to the Company of the loss, theft, destruction, or mutilation of
this Warrant and, in the case of any such loss, theft, or destruction, upon
delivery of an indemnity agreement reasonably satisfactory in form and amount to
the Company, or, in the case of any such mutilation, upon surrender and
cancellation of this Warrant, the Company, at its expense, will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
(d) Cancellation: Payment of Expenses. Upon the surrender of this
----------------------------------
Warrant in connection with any transfer, exchange, or replacement as provided in
this Paragraph 7, this Warrant shall be promptly canceled by the Company. The
Company shall pay all taxes (other than securities transfer taxes) and all other
expenses and charges payable in connection with the preparation, execution, and
delivery of Warrants pursuant to this Paragraph 7.
(e) Register. The Company shall maintain, at its principal executive
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offices (or such other office or agency of the Company as it may designate by
notice to the holder hereof), a register for this Warrant, in which the Company
shall record the name and address of the person in whose name this Warrant has
been issued, as well as the name and address of each transferee and each prior
owner of this Warrant.
(f) Exercise or Transfer Without Registration. If, at the time of the
-----------------------------------------
surrender of this Warrant in connection with any exercise, transfer, or exchange
of this Warrant, this Warrant (or, in the case of any exercise, the Warrant
Shares issuable hereunder, shall not be registered under the Securities Act of
1933, as amended (the "Securities Act"), and under applicable state securities
or blue sky laws, the Company may require, as a condition of allowing such
exercise, transfer, or exchange, (i) that the holder or transferee of this
Warrant, as the case may be, furnish to the Company a written opinion of
counsel, which opinion and counsel are acceptable to the Company, to the effect
that such exercise, transfer, or exchange may be made without registration under
said Act and under applicable state securities or blue sky laws and (ii) that
the holder or transferee execute and deliver to the Company an investment letter
in form and substance acceptable to the Company. Except in respect of a sale
pursuant to an effective Registration Statement under the Securities Act as
contemplated by Section 9 of the Securities Purchase Agreement, the first holder
of this Warrant, by taking and holding the same, represents to the Company that
such holder is acquiring this Wan-ant for investment and not with a view to the
distribution thereof.
IF THE INITIAL HOLDER OF THIS WARRANT IS A PENNSYLVANIA RESIDENT, SUCH HOLDER
HEREBY AGREES NOT TO SELL THIS WARRANT OR THE WARRANT SHARES FOR A PERIOD OF 12
MONTHS FROM THE DATE HEREOF, EXCEPT IN
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ACCORDANCE WITH SEC-NON 204.011 OF THE PENNSYLVANIA SECURITIES ACT OF 1972, AS
AMENDED.
8. Registration Rights.
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The holder of this Warrant or the Warrant Shares shall have only such
registration rights, if any, in respect of this Warrant and the Warrant Shares
as are later provided and agreed to in writing by the Company, if any.
9. Right to Redeem.
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The Company shall have the right, upon thirty (30) days written
notice, to call this Warrant for redemption, in whole or in part, at a call
price of $.001 per Warrant Share (i) following any calendar year in which the
Company's consolidated financial statements evidence net income of at least
$400,000 and net income per share of at least $.40 per share or (ii) at any time
after the Company proposes to consummate the acquisition of all of the stock or
assets of another company whose annual gross revenues from operations is at
least $10,000,000; provided, however, that in the event that this Warrant is
called for redemption pursuant to clause (ii) above and this Warrant is not
thereafter exercised in accordance with the terms hereof, then the holder shall
deliver this Warrant to the Company and the Company shall hold this Warrant in
escrow pending the consummation of such transaction. In the event such
transaction is terminated prior to consummation, this Warrant shall be returned
to the holder and all terms of this Warrant shall continue in full force and
effect as if such call had not been made, and in the event the transaction is
consummated the Company shall pay the redemption proceeds to the holder and
cancel the Warrant.
10. Notices. All notices, requests, and other communications
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required or permitted to be given or delivered hereunder to the holder of this
Warrant shall be in writing, and shall be personally delivered, or shall be sent
by certified or registered mail, postage prepaid and addressed, to such holder
at the address shown for such holder on the books of the Company, or at such
other address as shall have been furnished to the Company by notice from such
holder. All notices, requests, and other communications required or permitted to
be given or delivered hereunder to the Company shall be in writing, and shall be
personally delivered, or shall be sent by certified or registered mail or by
recognized overnight mail carrier, postage prepaid and addressed, to the office
of the Company at 000 Xxxx Xxxxx Xxxxxxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxxxxxxxxxx,
XX 00000 Attention: Chairman, or at such other address as shall have been
furnished to the holder of this Warrant by notice from the Company. Any such
notice, request, or other communication may be sent by telegram, telex, or
telecopy, but shall in such case be subsequently confirmed by a writing
personally delivered or sent by certified or registered mail as provided above.
All notices, requests, and other communications shall be deemed to have been
given either at the time of the delivery thereof to (or the receipt by, in the
case of a telegram, telex or telecopy) the person entitled to receive such
notice at the address of such person for
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purposes of this Paragraph 10, or, if mailed, at the completion of the third
full day following the time of such mailing thereof to such address, as the case
may be.
11. GOVERNING LAW. THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED
-------------
AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF DELAWARE
WITHOUT REGARD TO THE BODY OF LAW CONTROLLING CONFLICTS OF LAW. EACH OF THE
PARTIES HERETO HEREBY CONSENTS TO THE EXCLUSIVE JURISDICTION OF ANY STATE OR
FEDERAL COURT LOCATED WITHIN THE STATE OF DELAWARE FOR ANY PROCEEDING TO WHICH
ANY OF THE PARTIES HERETO IS A PARTY AND WHICH RELATES TO THIS WARRANT. TO THE
EXTENT PERMITTED BY LAW, EACH PARTY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED
ON LACK OF JURISDICTION OR IMPROPER VENUE OR FORUM NON-CONVENIENS TO THE CONDUCT
OF ANY PROCEEDING INSTITUTED HEREUNDER OR ANY PROCEEDING TO WHICH ANY PARTY TO
THIS WARRANT IS A PARTY AND WHICH RELATES TO THIS WARRANT AND THE TRANSACTIONS
CONTEMPLATED HEREBY.
12. Miscellaneous.
-------------
(a) Amendments. This Warrant and any provision hereof may not be
----------
changed, waived, discharged, or terminated orally, but only by, an instrument in
writing signed by the Company and holders representing a majority of the shares
of Common Stock acquirable upon exercise of this Warrant.
(b) Descriptive Headings. The descriptive headings of the several
--------------------
paragraphs of this Warrant are inserted for purposes of reference only, and
shall not affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the Company has caused this Class C-3 Warrant to
be signed by its duly authorized officer.
THE EASTWIND GROUP, INC.
By:_____________________________
Its:___________________________
Agreed to and Accepted
By: ___________________________________
American Maple Leaf Financial Corporation
Initial Holder
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FORM OF EXERCISE AGREEMENT
Dated: ____________, ____.
To:_________________
The undersigned, pursuant to the provisions set forth in the within
Warrant, hereby agrees to purchase ________ shares of Common Stock covered by
such Warrant, and makes Payment herewith in full therefor at the price per share
provided by such Warrant in cash or by certified or official bank check in the
amount of, or by surrender of securities issued by the Company having a market
value equal to $_________. Please issue a certificate or certificates for such
shares of Common Stock in the name of and pay, any cash for any fractional share
to:
Name:_____________________________
Signature:________________________
Address:__________________________
__________________________
Note: The above signature should correspond
exactly with the name on the face of the
within Warrant.
and, if said number of shares of Common Stock shall not be all the shares
purchasable under the within Warrant, a new Warrant is to be issued in the name
of said undersigned covering the balance of the shares purchasable thereunder
less any fraction of a share paid in cash.
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FORM OF ASSIGNMENT
------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and
transfers all of the rights of the undersigned under the within Warrant, with
respect to the number of shares of Common Stock covered thereby set forth herein
below, to:
Name of Assignee Address No. of Shares
---------------- ------- -------------
, and hereby irrevocably constitutes and appoints as agent and attorney-in-fact
to transfer said Warrant on the books of the within-named corporation, with full
power of substitution in the premises.
Dated: _________, ____.
In the presence of
________________________
Name:___________________________
Signature:________________________
Title of Signing Officer or Agent (if any):
________________________________
Address:_________________________
_________________________
Note: The above signature should
correspond exactly with the
name on the face of the within
Warrant.
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