FORM OF WARRANT AGREEMENT
Exhibit
4.4
FORM
OF WARRANT AGREEMENT
This
Warrant Agreement (this “Agreement”) made as of _____, 2007, by and between
Pinpoint Advance Corp., a Delaware corporation, with offices at 0 Xxxxxx Xxxxxx
Xxxxxxxxx,
Xxxxxx 00000 (“Company”), and American Stock Transfer & Trust Company, a New
York corporation, with offices at 00 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000
(“Warrant Agent”).
WHEREAS,
the Company is engaged in a public offering (“Public Offering”) of Units
(“Units”) and, in connection therewith, has determined to issue and deliver up
to (i) 2,875,000 Warrants (the “Public Warrants”) to the public investors, each
of such Public Warrants evidencing the right of the holder thereof to purchase
one share of common stock, par value $.0001 per share, of the Company’s Common
Stock (“Common Stock”) for $7.50, subject to adjustment as described herein, and
(ii) 125,000 Warrants to Maxim Group LLC as representative of the underwriters
(the “Underwriter”)
or its
designees (the “Underwriter’s
Warrants”),
with
each of such Underwriter’s Warrants evidencing the right of the holder thereof
to purchase one share of Common Stock for $7.50, subject to adjustment as
described herein.
WHEREAS,
the Company has filed with the Securities and Exchange Commission (the “SEC”) a
Registration Statement, No. 333-138110 on Form S-1 (“Registration
Statement”) for the registration under the Securities Act of 1933, as amended
(“Act”) of, among other securities, the Public Warrants, the Underwriter’s
Warrants and the Common Stock issuable upon exercise of each of the Public
Warrants and the Underwriter’s Warrants; and
WHEREAS,
the Company desires the Warrant Agent to act on behalf of the Company, and
the
Warrant Agent is willing to so act, in connection with the issuance,
registration, transfer, exchange, redemption and exercise of the Public
Warrants, the Underwriter’s Warrants and 1,500,000 warrants (“Private Warrants”,
together with the Public Warrants and the Underwriter’s Warrants shall be
referred to collectively as the “Warrants”) issued in connection with a
Regulation S private placement prior to the consummation of the Public Offering;
and
WHEREAS,
the Company desires to provide for the form and provisions of the Warrants,
the
terms upon which they shall be issued and exercised, and the respective rights,
limitation of rights, and immunities of the Company, the Warrant Agent, and
the
holders of the Warrants; and
WHEREAS,
all acts and things have been done and performed which are necessary to make
the
Warrants, when executed on behalf of the Company and countersigned by or on
behalf of the Warrant Agent, as provided herein, the valid, binding and legal
obligations of the Company, and to authorize the execution and delivery of
this
Agreement.
NOW,
THEREFORE, in consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
1. Appointment
of Warrant Agent.
The
Company hereby appoints the Warrant Agent to act as agent for the Company for
the Warrants, and the Warrant Agent hereby accepts such appointment and agrees
to perform the same in accordance with the terms and conditions set forth in
this Agreement.
2. Warrants.
2.1 Form
of Warrant.
Each
Warrant shall be issued in registered form only. The Public Warrants and the
Underwriter’s Warrants shall be in substantially the form of Exhibit A hereto
and the Private Warrants shall be in substantially the form of Exhibit B hereto,
the provisions of each of which are incorporated herein, and shall be signed
by,
or bear the facsimile signature of, the Chief Executive Officer or President
and
Chief Financial Officer, Treasurer, Secretary or Assistant Secretary
of the
Company and shall bear a facsimile of the Company’s seal. In the event the
person whose facsimile signature has been placed upon any Warrant shall have
ceased to serve in the capacity in which such person signed the Warrant before
such Warrant is issued, it may be issued with the same effect as if he or she
had not ceased to be such at the date of issuance.
2.2 Effect
of Countersignature.
Unless
and until countersigned by the Warrant Agent pursuant to this Agreement, a
Warrant shall be invalid and of no effect and may not be exercised by the holder
thereof.
2.3 Registration.
2.3.1 Warrant
Register.
The
Warrant Agent shall maintain books (“Warrant Register”) for the registration of
original issuance and the registration of transfer of the Warrants. Upon the
initial issuance of the Warrants, the Warrant Agent shall issue and register
the
Warrants in the names of the respective holders thereof in such denominations
and otherwise in accordance with instructions delivered to the Warrant Agent
by
the Company.
2.3.2 Registered
Holder.
Prior
to due presentment for registration of transfer of any Warrant, the Company
and
the Warrant Agent may deem and treat the person in whose name such Warrant
shall
be registered upon the Warrant Register (“registered holder”), as the absolute
owner of such Warrant and of each Warrant represented thereby (notwithstanding
any notation of ownership or other writing on the Warrant Certificate made
by
anyone other than the Company or the Warrant Agent), for the purpose of any
exercise thereof, and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary.
2.4 Detachability
of Public Warrants.
The
securities comprising the Units will begin to trade separately on the 90th
trading day after the effective date of the Registration Statement, provided
that in no event may the separate trading of the securities comprising the
Units
occur until the Company files with the SEC a Current Report on Form 8-K, which
includes an audited balance sheet reflecting the receipt by the Company of
the
gross proceeds of the sale of the Private Warrants and the Public Offering,
including the proceeds received by the Company from the exercise of the
Underwriters' over-allotment option, if the over-allotment option is exercised
on the date of the effective date of the Registration Statement (the "BALANCE
SHEET 8-K"). The securities comprising the Units may begin to trade separately
earlier than on the 90th trading date after the effective date of the
Registration Statement if Maxim Group LLC, informs the Company of its decision
to allow earlier separate trading, provided that in no event may the earlier
separate trading of the securities comprising the Units occur until the Company
files with the SEC the Balance Sheet 8-K and the Company issues a press release
and files with the SEC a Current Report on Form 8-K announcing when such
separate trading will begin.
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3. Terms
and Exercise of Warrants.
3.1 Warrant
Price.
Each
Warrant shall, when countersigned by the Warrant Agent, entitle the registered
holder thereof, subject to the provisions of such Warrant and of this Warrant
Agreement, to purchase from the Company the number of shares of Common Stock
stated therein, at the price of $7.50 per whole share, subject to the
adjustments provided in Section 4 hereof and in the last sentence of this
Section 3.1. The term “Warrant Price” as used in this Warrant Agreement refers
to the price per share at which Common Stock may be purchased at the time a
Warrant is exercised. The Company in its sole discretion may lower the Warrant
Price at any time prior to the Expiration Date for a period of not less than
ten
business days, provided that any such reduction shall be identical among all
of
the Warrants. The
Private Warrants may be exercised on a “cashless” basis provided that at the
time of exercise they
are
held by the original purchaser thereof, or their permitted assigns.
In
the
event the Private
Warrants are exercised on a “cashless” basis the holder thereof shall surrender
his or
her
Private
Warrant for that number of shares of Common Stock equal to the quotient obtained
by dividing
(x) the product of the number of shares of Common Stock underlying the
Private Warrant,
multiplied by the difference between the Warrant Price and the Fair Market
Value
(as
defined
below) by (y) the Fair Market Value. The “FAIR MARKET VALUE” shall mean the
average reported last sale price of the Common Stock for the 10 trading days
ending on the third business day prior to the date on which notice of exercise
is received by the Company.
3.2 Duration
of Warrants.
3.2.1
Public Warrants and Underwriter’s Warrants. A Public Warrant or Underwriter’s
Warrant may be exercised only during the period commencing on the later of:
(i)
the consummation by the Company of a merger, capital stock exchange, asset
acquisition or other similar business combination (as described more fully
in
the Registration Statement, “Business Combination”), or (ii) [______], 2008 and
terminating at 5:00 p.m., New York City time on the earlier to occur of (x)
[______], 2011 or (y) the date fixed for redemption of the Warrants as provided
in Section 6 of this Agreement. Notwithstanding the foregoing, no Public Warrant
or Underwriter’s Warrant shall be exercisable unless, at the time of exercise, a
registration statement relating to the Common Stock issuable upon the exercise
of such Public Warrant or Underwriter’s Warrant is effective and current and a
prospectus is available for use by the holders thereof and the Common Stock
has
been qualified or deemed to be exempt under the securities laws of the state
of
residence of the holder of such Public Warrants or Underwriter’s
Warrants
3.2.2 Private
Warrants. A Private Warrant may be exercised only during the period commencing
on the later of: (i) the consummation by the Company of a merger, capital stock
exchange, asset acquisition or other similar business combination (as described
more fully in the Registration Statement, “Business Combination”), or (ii)
[______], 2008 and terminating at 5:00 p.m., New York City time on the earlier
to occur of (x) [______], 2011 or (y) the date fixed for redemption of the
Warrants as provided in Section 6 of this Agreement. The Private Warrants are
not subject to redemption so long as they are held by their initial purchasers
or their permitted designees.
3.2.3 General.
The period during which a Warrant may be exercised shall be deemed the “Exercise
Period” and the termination of such Exercise Period shall be deemed the
“Expiration Date”. Except with respect to the right to receive the Redemption
Price (as set forth in Section 6 hereunder), each Warrant not exercised on
or
before the Expiration Date shall become void, and all rights thereunder and
all
rights in respect thereof under this Agreement shall cease at the close of
business on the Expiration Date. The Company in its sole discretion may extend
the duration of the Warrants by delaying the Expiration Date; provided, however,
that the Company will provide notice to registered holders of the Warrants
of
such extension of not less than 20 days and, further provided that any such
extension shall be identical in duration among all of the Warrants.
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3.3 Exercise
of Warrants.
3.3.1 Payment.
Subject
to the provisions of the Warrants and this Warrant Agreement, a Warrant, when
countersigned by the Warrant Agent, may be exercised by the registered holder
thereof by surrendering it, at the office of the Warrant Agent, or at the office
of its successor as Warrant Agent, in the Borough of Manhattan, City and State
of New York, with the subscription form, as set forth in the Warrant, duly
executed by paying in full, in lawful money of the United States, in cash,
good certified check or good bank draft payable to the order of the Company,
the
Warrant Price for each full share of Common Stock as to which the Warrant is
exercised and any and all applicable taxes due in connection with the exercise
of the Warrant, the exchange of the Warrant for the Common Stock, and the
issuance of the Common Stock.
3.3.2 Issuance
of Certificates.
As soon
as practicable after the exercise of any Warrant and the clearance of the funds
in payment of the Warrant Price, the Company shall issue to the registered
holder of such Warrant a certificate or certificates for the number of full
shares of Common Stock to which he, she or it is entitled, registered in such
name or names as may be directed by him, her or it, and if such Warrant shall
not have been exercised in full, a new countersigned Warrant for the number
of
shares as to which such Warrant shall not have been exercised. Notwithstanding
the foregoing, the Company shall not be obligated to deliver any securities
pursuant to the exercise of a Warrant unless (i) a registration statement under
the Act with respect to the Common Stock issuable upon such exercise is
effective, or (ii) in the opinion of counsel to the Company, the exercise of
the
Warrants is exempt from the registration requirements of the Act and such
securities are qualified for sale or exempt from qualification under applicable
securities laws of the states or other jurisdictions in which the registered
holders reside. Warrants may not be exercised by, or securities issued to,
any
registered holder in any state in which such exercise or issuance would be
unlawful. In no event will the registered holder of a warrant be entitled to
receive a net-cash settlement in lieu of physical settlement in shares of Common
Stock, regardless of whether the Common Stock underlying the Warrants is
registered pursuant to an effective registration statement.
3.3.3 Valid
Issuance.
All
shares of Common Stock issued upon the proper exercise of a Warrant in
conformity with this Agreement shall be validly issued, fully paid and
nonassessable.
3.3.4 Date
of Issuance.
Each
person in whose name any such certificate for shares of Common Stock is issued
shall for all purposes be deemed to have become the holder of record of such
shares on the date on which the Warrant was surrendered and payment of the
Warrant Price was made, irrespective of the date of delivery of such
certificate, except that, if the date of such surrender and payment is a date
when the stock transfer books of the Company are closed, such person shall
be
deemed to have become the holder of such shares at the close of business on
the
next succeeding date on which the stock transfer books are open.
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3.3.5 Warrant
Solicitation and Warrant Solicitation Fee.
(a) The
Company has engaged Maxim Group LLC (“Maxim”), on a non-exclusive basis, as its
agent for the solicitation of the exercise of the Warrants. The Company, at
its
cost, will (i) assist Maxim with respect to such solicitation, if requested
by
Maxim, and (ii) provide Maxim, and direct the Company’s transfer agent and the
Warrant Agent to deliver to Maxim, lists of the record and, to the extent known,
beneficial owners of the Company’s Warrants. The Company hereby instructs the
Warrant Agent to cooperate with Maxim in every respect in connection with
Maxim’s solicitation activities, including, but not limited to, providing to
Maxim, at the Company’s cost, a list of record and beneficial holders of the
Warrants and circulating a prospectus or offering circular disclosing the
compensation arrangements referenced in Section 3.3.5(b) below to holders of
the
Warrants at the time of exercise of the Warrants. In addition to the conditions
set forth in Section 3.3.5(b), Maxim shall accept payment of the warrant
solicitation fee provided in Section 3.3.5(b) only if it has provided bona
fide
services to the Company in connection with the exercise of the Warrants and
only
to the extent that an investor who exercises his Warrants specifically
designates, in writing, that Maxim solicited his, her or its exercise. In
addition to soliciting, either orally or in writing, the exercise of Warrants
by
a Warrant holder, such services may also include disseminating information,
either orally or in writing, to Warrant holders about the Company or the market
for the Company’s securities, or assisting in the processing of the exercise of
Warrants.
(b) In
each
instance in which a Warrant is exercised, the Warrant Agent shall promptly
give
written notice of such exercise to the Company and Maxim (“Warrant Agent’s
Exercise Notice”). If, upon the exercise of any Warrant more than one year from
the effective date of the Registration Statement, (i) the market price of the
Company’s Common Stock is greater than the Warrant Price, (ii) disclosure of
compensation arrangements between the Company and Maxim with respect to the
solicitation of the exercise of the Warrants was made both at the time of the
Public Offering and at the time of exercise (by delivery of the Prospectus
or as
otherwise required by applicable law, rule or regulation), (iii) the holder
of
the Warrant confirms in writing that the exercise of the Warrant was solicited
by Maxim, (iv) the Warrant was not held in a discretionary account, and (v)
the
solicitation of the exercise of the Warrant was not in violation of Regulation
M
(as such rule or any successor rule may be in effect as of such time of
exercise) promulgated under the Securities Exchange Act of 1934, as amended,
then the Warrant Agent, simultaneously with the distribution of the Common
Stock
underlying the Warrants so exercised in accordance with the instructions from
the Company following receipt of the proceeds to the Company received upon
exercise of such Warrant(s), shall, on behalf of the Company, pay a fee of
5% of
the Warrant Price to Maxim, provided that Maxim delivers to the Warrant
Agent within ten (10) business days from the date on which Maxim has received
the Warrant Agent’s Exercise Notice, a certificate that the conditions set forth
in the preceding clauses (iii), (iv) and (v) have been satisfied.
Notwithstanding the foregoing, no fee will be paid to Maxim with respect to
the
exercise by the Underwriters or their affiliates or the Company’s officers or
directors of Warrants purchased by it or them and still held by them for its
or
their own account. Maxim and the Company may, at any time during business hours,
examine the records of the Warrant Agent, including its ledger of original
Warrant certificates returned to the Warrant Agent upon exercise of
Warrants.
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(c) The
provisions of this Section 3.3.5 may not be modified, amended or deleted without
the prior written consent of Maxim.
4. Adjustments.
4.1 Stock
Dividends Split Ups.
If
after the date hereof, and subject to the provisions of Section 4.6 below,
the
number of outstanding shares of Common Stock is increased by a stock dividend
payable in shares of Common Stock, or by a split up of shares of Common Stock,
or other similar event, then, on the effective date of such stock dividend,
split up or similar event, the number of shares of Common Stock issuable on
exercise of each Warrant shall be increased in proportion to such increase
in
outstanding shares of Common Stock.
4.2 Aggregation
of Shares.
If
after the date hereof, and subject to the provisions of Section 4.6, the number
of outstanding shares of Common Stock is decreased by a consolidation,
combination, reverse stock split or reclassification of shares of Common Stock
or other similar event, then, on the effective date of such consolidation,
combination, reverse stock split, reclassification or similar event, the number
of shares of Common Stock issuable on exercise of each Warrant shall be
decreased in proportion to such decrease in outstanding shares of Common
Stock.
4.3 Adjustments
in Exercise Price.
Whenever the number of shares of Common Stock purchasable upon the exercise
of
the Warrants is adjusted, as provided in Section 4.1 and 4.2 above, the Warrant
Price shall be adjusted (to the nearest cent) by multiplying such Warrant Price
immediately prior to such adjustment by a fraction (x) the numerator of which
shall be the number of shares of Common Stock purchasable upon the exercise
of
the Warrants immediately prior to such adjustment, and (y) the denominator
of
which shall be the number of shares of Common Stock so purchasable immediately
thereafter.
4.4 Replacement
of Securities upon Reorganization, etc.
In case
of any reclassification or reorganization of the outstanding shares of Common
Stock (other than a change covered by Section 4.1 or 4.2 hereof or that solely
affects the par value of such shares of Common Stock), or in the case of any
merger or consolidation of the Company with or into another corporation (other
than a consolidation or merger in which the Company is the continuing
corporation and that does not result in any reclassification or reorganization
of the outstanding shares of Common Stock), or in the case of any sale or
conveyance to another corporation or entity of the assets or other property
of
the Company as an entirety or substantially as an entirety in connection with
which the Company is dissolved, the Warrant holders shall thereafter have the
right to purchase and receive, upon the basis and upon the terms and conditions
specified in the Warrants and in lieu of the shares of Common Stock of the
Company immediately theretofore purchasable and receivable upon the exercise
of
the rights represented thereby, the kind and amount of shares of stock or other
securities or property (including cash) receivable upon such reclassification,
reorganization, merger or consolidation, or upon a dissolution following any
such sale or transfer, that the Warrant holder would have received if such
Warrant holder had exercised his, her or its Warrant(s) immediately prior to
such event; and if any reclassification also results in a change in shares
of
Common Stock covered by Section 4.1 or 4.2, then such adjustment shall be made
pursuant to Sections 4.1, 4.2, 4.3 and this Section 4.4. The provisions of
this Section 4.4 shall similarly apply to successive reclassifications,
reorganizations, mergers or consolidations, sales or other
transfers.
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4.5 Notices
of Changes in Warrant.
Upon
every adjustment of the Warrant Price or the number of shares issuable on
exercise of a Warrant, the Company shall give written notice thereof to the
Warrant Agent, which notice shall state the Warrant Price resulting from such
adjustment and the increase or decrease, if any, in the number of shares
purchasable at such price upon the exercise of a Warrant, setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based. Upon the occurrence of any event specified in Sections
4.1, 4.2, 4.3 or 4.4, then, in any such event, the Company shall give written
notice to the Warrant holder, at the last address set forth for such holder
in
the Warrant Register, of the record date or the effective date of the event.
Failure to give such notice, or any defect therein, shall not affect the
legality or validity of such event.
4.6 No
Fractional Shares.
Notwithstanding any provision contained in this Warrant Agreement to the
contrary, the Company shall not issue fractional shares upon exercise of
Warrants. If, by reason of any adjustment made pursuant to this Section 4,
the
holder of any Warrant would be entitled, upon the exercise of such Warrant,
to
receive a fractional interest in a share, the Company shall, upon such exercise,
round up to the nearest whole number the number of the shares of Common Stock
to
be issued to the Warrant holder.
4.7 Form
of Warrant.
The
form of Warrant need not be changed because of any adjustment pursuant to this
Section 4, and Warrants issued after such adjustment may state the same Warrant
Price and the same number of shares as is stated in the Warrants initially
issued pursuant to this Agreement. However, the Company may at any time in
its
sole discretion make any change in the form of Warrant that the Company may
deem
appropriate and that does not affect the substance thereof, and any Warrant
thereafter issued or countersigned, whether in exchange or substitution for
an
outstanding Warrant or otherwise, may be in the form as so changed.
5. Transfer
and Exchange of Warrants.
5.1 Registration
of Transfer.
The
Warrant Agent shall register the transfer, from time to time, of any outstanding
Warrant upon the Warrant Register, upon surrender of such Warrant for transfer,
properly endorsed with signatures properly guaranteed and accompanied by
appropriate instructions for transfer. Upon any such transfer, a new Warrant
representing an equal aggregate number of Warrants shall be issued and the
old
Warrant shall be cancelled by the Warrant Agent. The Warrants so cancelled
shall
be delivered by the Warrant Agent to the Company from time to time upon
request.
5.2 Procedure
for Surrender of Warrants.
Warrants may be surrendered to the Warrant Agent, together with a written
request for exchange or transfer, and thereupon the Warrant Agent shall issue
in
exchange therefor one or more new Warrants as requested by the registered holder
of the Warrants so surrendered, representing an equal aggregate number of
Warrants; provided, however, that in the event that a Warrant surrendered for
transfer bears a restrictive legend, the Warrant Agent shall not cancel such
Warrant and issue new Warrants in exchange therefor until the Warrant Agent
has
received an opinion of counsel for the Company stating that such transfer may
be
made and indicating whether the new Warrants must also bear a restrictive
legend.
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5.3 Fractional
Warrants.
The
Warrant Agent shall not be required to effect any registration of transfer
or
exchange which will result in the issuance of a warrant certificate for a
fraction of a warrant.
5.4 Service
Charges.
No
service charge shall be made for any exchange or registration of transfer of
Warrants.
5.5 Warrant
Execution and Countersignature.
The
Warrant Agent is hereby authorized to countersign and to deliver, in accordance
with the terms of this Agreement, the Warrants required to be issued pursuant
to
the provisions of this Section 5, and the Company, whenever required by the
Warrant Agent, will supply the Warrant Agent with Warrants duly executed on
behalf of the Company for such purpose.
6. Redemption.
6.1 Redemption.
Not
less than all of the outstanding Warrants may be redeemed, at the option of
the
Company, at any time after they become exercisable and prior to their
expiration, at the office of the Warrant Agent, upon the notice referred to
in
Section 6.3, at the price of $.01 per Warrant (“Redemption Price”), provided
that the last sales price of the Common Stock has been equal to or greater
than
$14.25 per share, on each of twenty (20) trading days within any thirty (30)
trading day period ending on the third business day prior to the date on which
notice of redemption is given. Notwithstanding the foregoing, the Registration
Statement must be current in order for the Company to exercise its redemption
rights pursuant to this Section 6. The provisions of this Section 6.1 may not
be
modified, amended or deleted without the prior written consent of Maxim. The
Private Warrants are not subject to this Section 6 provided they are held by
the
initial purchasers thereof, or their permitted designees.
6.2 Date
Fixed for, and Notice of, Redemption.
In the
event the Company shall elect to redeem all of the Warrants, the Company shall
fix a date for the redemption. Notice of redemption shall be mailed by first
class mail, postage prepaid, by the Company not less than 30 days prior to
the
date fixed for redemption to the registered holders of the Warrants to be
redeemed at their last addresses as they shall appear on the Warrant Register.
Any notice mailed in the manner herein provided shall be conclusively presumed
to have been duly given whether or not the registered holder received such
notice.
6.3 Exercise
After Notice of Redemption.
The
Warrants may be exercised in accordance with Section 3 of this Warrant Agreement
at any time after notice of redemption shall have been given by the Company
pursuant to Section 6.2 hereof and prior to the time and date fixed for
redemption. On and after the redemption date, the record holder of the Warrants
shall have no further rights except to receive, upon surrender of the Warrants,
the Redemption Price.
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7. Other
Provisions Relating to Rights of Holders of Warrants.
7.1 No
Rights as Stockholder
. A
Warrant does not entitle the registered holder thereof to any of the rights
of a
stockholder of the Company, including, without limitation, the right to receive
dividends, or other distributions, exercise any preemptive rights to vote or
to
consent or to receive notice as stockholders in respect of the meetings of
stockholders or the election of directors of the Company or any other
matter.
7.2 Lost,
Stolen, Mutilated, or Destroyed Warrants.
If any
Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant
Agent may on such terms as to indemnity or otherwise as they may in their
discretion impose (which shall, in the case of a mutilated Warrant, include
the
surrender thereof), issue a new Warrant of like denomination, tenor, and date
as
the Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant
shall
constitute a substitute contractual obligation of the Company, whether or not
the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any
time
enforceable by anyone.
7.3 Reservation
of Common Stock.
The
Company shall at all times reserve and keep available a number of its authorized
but unissued shares of Common Stock that will be sufficient to permit the
exercise in full of all outstanding Warrants issued pursuant to this Warrant
Agreement.
7.4 Registration
of Common Stock.
The
Company agrees that prior to the commencement of the Exercise Period, it shall
file with the SEC a post-effective amendment to the Registration Statement,
or a
new registration statement, for the registration, under the Act, of, and it
shall take such action as is necessary to qualify for sale, in those states
in
which the Warrants were initially offered by the Company, the Common Stock
issuable upon exercise of the Warrants. In either case, the Company will use
its
best efforts to cause the same to become effective on or prior to the
commencement of the Exercise Period and to maintain the effectiveness of such
registration statement until the expiration of the Warrants in accordance with
the provisions of this Warrant Agreement. In addition, the Company agrees to
use
its reasonable efforts to register such securities under the blue sky laws
of
the states of residence of the exercising warrant holders to the extent an
exemption is not available. The provisions of this Section 7.4 may not be
modified, amended or deleted without the prior written consent of Maxim.
Notwithstanding the foregoing, a Warrant can expire unexercised regardless
of
whether a registration statement is current under the Act with respect to the
Common Stock issuable upon exercise of the Warrants. In no event will the
registered holder of a warrant be entitled to receive a net-cash settlement
or
shares of Common Stock or other consideration as of result of the Company's
non-compliance with this Section 7.4.
8. Concerning
the Warrant Agent and Other Matters.
8.1 Payment
of Taxes.
The
Company will from time to time promptly pay all taxes and charges that may
be
imposed upon the Company or the Warrant Agent in respect of the issuance or
delivery of shares of Common Stock upon the exercise of Warrants, but the
Company shall not be obligated to pay any transfer taxes in respect of the
Warrants or such shares.
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8.2 Resignation,
Consolidation, or Merger of Warrant Agent.
8.2.1 Appointment
of Successor Warrant Agent.
The
Warrant Agent, or any successor to it hereafter appointed, may resign its duties
and be discharged from all further duties and liabilities hereunder after giving
sixty (60) days’ notice in writing to the Company. If the office of the Warrant
Agent becomes vacant by resignation or incapacity to act or otherwise, the
Company shall appoint in writing a successor Warrant Agent in place of the
Warrant Agent. If the Company shall fail to make such appointment within a
period of 30 days after it has been notified in writing of such resignation
or
incapacity by the Warrant Agent or by the holder of the Warrant (who shall,
with
such notice, submit his Warrant for inspection by the Company), then the holder
of any Warrant may apply to the Supreme Court of the State of New York for
the
County of New York for the appointment of a successor Warrant Agent. Any
successor Warrant Agent, whether appointed by the Company or by such court,
shall be a corporation organized and existing under the laws of the State of
New
York, in good standing and having its principal office in the Borough of
Manhattan, City and State of New York, and authorized under such laws to
exercise corporate trust powers and subject to supervision or examination by
federal or state authority. After appointment, any successor Warrant Agent
shall
be vested with all the authority, powers, rights, immunities, duties, and
obligations of its predecessor Warrant Agent with like effect as if originally
named as Warrant Agent hereunder, without any further act or deed; but if for
any reason it becomes necessary or appropriate, the predecessor Warrant Agent
shall execute and deliver, at the expense of the Company, an instrument
transferring to such successor Warrant Agent all the authority, powers, and
rights of such predecessor Warrant Agent hereunder; and upon request of any
successor Warrant Agent the Company shall make, execute, acknowledge, and
deliver any and all instruments in writing for more fully and effectually
vesting in and confirming to such successor Warrant Agent all such authority,
powers, rights, immunities, duties, and obligations.
8.2.2 Notice
of Successor Warrant Agent.
In the
event a successor Warrant Agent shall be appointed, the Company shall give
notice thereof to the predecessor Warrant Agent and the transfer agent for
the
Common Stock not later than the effective date of any such
appointment.
8.2.3 Merger
or Consolidation of Warrant Agent.
Any
corporation into which the Warrant Agent may be merged or with which it may
be
consolidated or any corporation resulting from any merger or consolidation
to
which the Warrant Agent shall be a party shall be the successor Warrant Agent
under this Warrant Agreement without any further act.
8.3 Fees
and Expenses of Warrant Agent.
8.3.1 Remuneration.
The
Company agrees to pay the Warrant Agent reasonable remuneration for its services
as such Warrant Agent hereunder as set forth on Exhibit A hereto, and will
reimburse the Warrant Agent upon demand for all expenditures that the Warrant
Agent may reasonably incur in the execution of its duties
hereunder.
8.3.2 Further
Assurances.
The
Company agrees to perform, execute, acknowledge, and deliver or cause to be
performed, executed, acknowledged, and delivered all such further and other
acts, instruments, and assurances as may reasonably be required by the Warrant
Agent for the carrying out or performing of the provisions of this Warrant
Agreement.
10
8.4 Liability
of Warrant Agent.
8.4.1 Reliance
on Company Statement.
Whenever in the performance of its duties under this Warrant Agreement, the
Warrant Agent shall deem it necessary or desirable that any fact or matter
be
proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a statement signed by the Chief Executive Officer or Chief
Operating Officer of the Company and delivered to the Warrant Agent. The Warrant
Agent may rely upon such statement for any action taken or suffered in good
faith by it pursuant to the provisions of this Warrant Agreement.
8.4.2 Indemnity.
The
Warrant Agent shall be liable hereunder only for its own negligence, willful
misconduct or bad faith. The Company agrees to indemnify the Warrant Agent
and
save it harmless against any and all liabilities, including judgments, costs
and
reasonable counsel fees, for anything done or omitted by the Warrant Agent
in
the execution of this Warrant Agreement except as a result of the Warrant
Agent’s negligence, willful misconduct, or bad faith.
8.4.3 Exclusions.
The
Warrant Agent shall have no responsibility with respect to the validity of
this
Warrant Agreement or with respect to the validity or execution of any Warrant
(except its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this Warrant
Agreement or in any Warrant; nor shall it be responsible to make any adjustments
required under the provisions of Section 4 hereof or responsible for the manner,
method, or amount of any such adjustment or the ascertaining of the existence
of
facts that would require any such adjustment; nor shall it by any act hereunder
be deemed to make any representation or warranty as to the authorization or
reservation of any shares of Common Stock to be issued pursuant to this Warrant
Agreement or any Warrant or as to whether any shares of Common Stock will when
issued be valid and fully paid and nonassessable.
8.5 Acceptance
of Agency.
The
Warrant Agent hereby accepts the agency established by this Warrant Agreement
and agrees to perform the same upon the terms and conditions herein set forth
and among other things, shall account promptly to the Company with respect
to
Warrants exercised and concurrently account for, and pay to the Company, all
moneys received by the Warrant Agent for the purchase of shares of the Company’s
Common Stock through the exercise of Warrants.
9. Miscellaneous
Provisions.
9.1 Successors
. All
the covenants and provisions of this Warrant Agreement by or for the benefit
of
the Company or the Warrant Agent shall bind and inure to the benefit of their
respective successors and assigns.
11
9.2 Notices.
Any
notice or other communication required or which may be given hereunder shall
be
in writing and either be delivered personally or by private national courier
service, or be mailed, certified or registered mail, return receipt requested,
postage prepaid, and shall be deemed given when so delivered personally or,
if
sent by private national courier service, on the next business day after
delivery to the courier, or, if mailed, two business days after the date of
mailing, as follows:
0
Xxxxxx
Xxxxxx
Xxxxxxxxx,
Xxxxxx 00000
Attn:
Adiv Baruch
President
Any
notice, statement or demand authorized by this Warrant Agreement to be given
or
made by the holder of any Warrant or by the Company to or on the Warrant Agent
shall be sufficiently given when so delivered if by hand or overnight delivery
or if sent by certified mail or private courier service five days after deposit
of such notice, postage prepaid, addressed (until another address is filed
in
writing by the Warrant Agent with the Company), as follows:
American
Stock Transfer & Trust Company
00
Xxxxxx
Xxxx, Xxxxx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxx Xxxxxx, Vice President
with
a
copy in each case to:
Xxxxxxxxxx
& Xxxxx LLP
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxx X. Xxxxxxx
and
Ellenoff
Xxxxxxxx & Schole LLP
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxxx Xxxxxxxx, Esq.
and
Maxim
Group LLC
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxxxx X. Xxxxxx, Managing Director
9.3 Applicable
law.
The
validity, interpretation, and performance of this Warrant Agreement and of
the
Warrants shall be governed in all respects by the laws of the State of New
York,
without giving effect to conflict of laws. The Company hereby agrees that any
action, proceeding or claim against it arising out of or relating in any way
to
this Warrant Agreement shall be brought and enforced in the courts of the State
of New York or the United States District Court for the Southern District of
New
York, and irrevocably submits to such jurisdiction, which jurisdiction shall
be
exclusive. The Company hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenient forum. Any such
process or summons to be served upon the Company 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 9.2 hereof. Such
mailing shall be deemed personal service and shall be legal and binding upon
the
Company in any action, proceeding or claim.
12
9.4 Persons
Having Rights under this Warrant Agreement.
Nothing
in this Warrant Agreement expressed and nothing that may be implied from any
of
the provisions hereof is intended, or shall be construed, to confer upon, or
give to, any person or corporation other than the parties hereto and the
registered holders of the Warrants and, for the purposes of Sections 3.3.5,
6.1,
7.4, 9.2 and 9.8 hereof, Maxim, any right, remedy, or claim under or by reason
of this Warrant Agreement or of any covenant, condition, stipulation, promise,
or agreement hereof. Maxim shall be deemed to be a third-party beneficiary
of
this Warrant Agreement with respect to Sections 3.3.5, 6.1, 7.4, 9.2 and 9.8
hereof. All covenants, conditions, stipulations, promises, and agreements
contained in this Warrant Agreement shall be for the sole and exclusive benefit
of the parties hereto (and Maxim with respect to the Sections 3.3.5, 6.1, 7.4,
9.2 and 9.8 hereof) and their successors and assigns and of the registered
holders of the Warrants.
9.5 Examination
of the Warrant Agreement.
A copy
of this Warrant Agreement shall be available at all reasonable times at the
office of the Warrant Agent in the Borough of Manhattan, City and State of
New
York, for inspection by the registered holder of any Warrant. The Warrant Agent
may require any such holder to submit his Warrant for inspection by
it.
9.6 Counterparts.
This
Warrant 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 all such
counterparts shall together constitute but one and the same
instrument.
9.7 Effect
of Headings.
The
Section headings herein are for convenience only and are not part of this
Warrant Agreement and shall not affect the interpretation thereof.
9.8 Amendments.
This
Warrant Agreement may be amended by the parties hereto without the consent
of
any registered holder for the purpose of curing any ambiguity, or of curing,
correcting or supplementing any defective provision contained herein or adding
or changing any other provisions with respect to matters or questions arising
under this Warrant Agreement as the parties may deem necessary or desirable
and
that the parties deem shall not adversely affect the interest of the registered
holders. All other modifications or amendments, including any amendment to
increase the Warrant Price or shorten the Exercise Period, shall require the
written consent of each of Maxim and the registered holders of a majority of
the
then outstanding Warrants. Notwithstanding the foregoing, the Company may lower
the Warrant Price or extend the duration of the Exercise Period in accordance
with Sections 3.1 and 3.2, respectively, without such consent.
9.9 Severability.
This
Warrant Agreement shall be deemed severable, and the invalidity or
unenforceability of any term or provision hereof shall not affect the validity
or enforceability of this Warrant Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable term or
provision, the parties hereto intend that there shall be added as a part of
this
Warrant Agreement a provision as similar in terms to such invalid or
unenforceable provision as may be possible and be valid and
enforceable.
[remainder
of document continued on next page]
13
IN
WITNESS WHEREOF, this Warrant Agreement has been duly executed by the parties
hereto as of the day and year first above written.
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Attest:_____________________________
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By: | |
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Adiv
Baruch
President
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AMERICAN
STOCK TRANSFER & TRUST COMPANY
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Attest:_____________________________
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By: | |
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Name:
Title:
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