Exhibit 4.2
THIS WARRANT AND THE OTHER SECURITIES ISSUABLE UPON EXERCISE THEREOF HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS. THEY HAVE BEEN ACQUIRED SOLELY FOR INVESTMENT AND
NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION
THEREOF. THE WARRANT REPRESENTED BY THIS INSTRUMENT AND THE OTHER
SECURITIES ISSUABLE UPON EXERCISE THEREOF MAY NOT BE SOLD, TRANSFERRED, OR
OTHERWISE DISPOSED OF BY THE HOLDER EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT FILED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
WITH RESPECT THERETO OR IN ACCORDANCE WITH AN OPINION OF COUNSEL IN FORM
AND SUBSTANCE SATISFACTORY TO THE ISSUER THAN AN EXEMPTION FROM SUCH
REGISTRATION IS AVAILABLE.
WARRANT (BRIDGE WARRANT)
To Purchase ________ of Common Stock of Ambient Corporation
No.: ___________ April __, 2002
1. Number of Shares; Exercise Price; Term. This certifies that in
connection for $1.00 and other good and valuable consideration, including but
not limited to the agreement of ___________ (the "Holder") to make certain loans
to Ambient Corporation (the "Company"), the receipt and sufficiency of which are
hereby acknowledged, the Holder or its assigns is entitled, upon the terms and
subject to the conditions hereinafter set forth at any time from the date hereof
and until at or prior to 11:59 p.m., Eastern Standard Time, on a date which is
three (3) years from the date hereof, but not thereafter, to acquire from the
Company, in whole or in part, from time to time, up to ____________________
fully-paid shares of the Company's common stock, par value $0.001 per share
("Common Stock" or "Shares") at a per-share purchase price of $0.40 per Share
(the "Exercise Price"). Such number of Shares and Exercise Price are subject to
adjustment as provided herein, and all references to "Common Stock" and
"Exercise Price" herein shall be deemed to include any such adjustment or series
of adjustments.
2. Exercise of Warrant. The purchase rights represented by this Warrant
are exercisable by Holder, in whole or in part, at any time, or from time to
time, subsequent to the date hereof, by the surrender of this Warrant and the
Notice of Exercise annexed hereto, all duly completed and executed on behalf of
Holder, at the office of the Company in Brookline, Massachusetts (or such other
office or agency of the Company as it may designate by notice in writing to
Holder at the address of Holder appearing on the books of the Company). Payment
of the Exercise Price for the Shares thereby purchased shall be made by cash,
certified or cashier's check or wire transfer payable to the order of the
Company, at 10:00 a.m., Eastern Standard Time, on the day following surrender of
this Warrant and the Notice of Exercise, in an amount equal to the purchase
price of the Shares thereby purchased. Thereupon Holder, as the holder of this
Warrant, shall be entitled to receive from the Company a stock certificate in
proper form representing the number of Shares so purchased, and a new Warrant in
substantially identical form and dated as of such exercise for the purchase of
that number of Shares equal to the difference, if any, between the number of
Shares subject hereto and the number of Shares as to which this Warrant is so
exercised.
3. Issuance of Shares. Certificates for Shares purchased hereunder shall
be delivered to Holder promptly after the date on which this Warrant shall have
been exercised in accordance with the terms hereof. The Company hereby
represents and warrants that all Shares that may be issued upon the exercise of
this Warrant will, upon such exercise, be duly and validly authorized and
issued, fully paid and nonassessable and free from all taxes, liens and charges
in respect of the issuance thereof (other than liens or charges created by or
imposed upon Holder as the holder of the Warrant or taxes in respect of any
transfer occurring contemporaneously or otherwise specified herein). The Company
agrees that the Shares so issued shall be and shall for all purposes be deemed
to have been issued to Holder as the record owner of such Shares as of the close
of business on the date on which this Warrant shall have been exercised or
converted in accordance with the terms hereof.
4. Representations and Warranties of the Holder. The Holder (i)
represents, warrants, covenants and agrees that the Warrant and the underlying
Shares are being acquired by the Holder for the Holder's own account, for
investment purposes only, and not with a view to any public distribution thereof
or with any present intention of so distributing all or any part of the Warrant
or the underlying Shares; (ii) understands (x) that if it should thereafter
decide to dispose of such Warrant or the underlying Shares (which it does not
contemplate at this time) it may do so only in compliance with the Securities
Act of 1933, as amended, (the "Securities Act"), including any exemption
therefrom, (y) this Warrant and the underlying Shares are not registered under
the Securities Act; and (iii) acknowledges that, as of the date hereof, it has
been given a full opportunity to ask questions of and to receive answers from
the Company concerning this Warrant and the underlying Shares and the business
of the Company and to obtain such information as it desired in order to evaluate
the acquisition of this Warrant and the underlying Shares, and all questions
have been answered to its full satisfaction.
5. No Fractional Shares or Scrip. No fractional Shares or scrip
representing fractional Shares shall be issued upon the exercise of this
Warrant. In lieu of any fractional Share to which Holder as the holder would
otherwise be entitled, Holder shall be entitled, at its option, to receive
either:
(a) a cash payment equal to the excess of fair market value for such
fractional Share above the Exercise Price for such fractional share (as
determined in good faith by the Company); or
(b) a whole Share if Holder tenders the Exercise Price for one whole
share.
6. No Rights as Shareholder. This Warrant does not entitle Holder as a
holder hereof to any voting rights or other rights as a shareholder of the
Company prior to the exercise hereof.
7. Charges, Taxes and Expenses. Certificates for Shares issued upon
exercise of this Warrant shall be issued in the name of Holder as the holder of
this Warrant. Issuance of certificates for Shares upon the exercise of this
Warrant shall be made without charge to Holder for any issue or transfer tax or
other incidental expense in respect of the issuance of such certificates, all of
which taxes and expenses shall be paid by the Company.
8. No Transfer. This Warrant and any rights hereunder are not transferable
by Holder as the holder hereof, in whole or in part, without the prior written
consent of the Company.
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9. Exchange and Registry of Warrant. This Warrant is exchangeable, upon
the surrender hereof by Holder as the registered holder at the above-mentioned
office or agency of the Company, for a new Warrant on substantially identical
form and dated as of such exchange. The Company shall maintain at the
above-mentioned office or agency a registry showing the name and address of
Holder as the registered holder of this Warrant. This Warrant may be surrendered
for exchange or exercise, in accordance with its terms, at the office of the
Company, and the Company shall be entitled to rely in all respects, prior to
written notice to the contrary, upon such registry.
10. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and in the case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to it, and upon
reimbursement to the Company of all reasonable expenses incidental thereto, and
upon surrender and cancellation of this Warrant, if mutilated, the Company will
make and deliver a new Warrant of like tenor and dated as of such cancellation
and reissuance, in lieu of this Warrant.
11. Reservation of Common Stock. The Company will at all times reserve and
keep available, solely for issuance, sale and delivery upon the exercise of this
Warrant, such number of Shares equal to the number of Shares purchasable upon
the exercise of this Warrant. All such Shares shall be duly authorized and, when
issued upon exercise of this Warrant in accordance with the terms hereof, will
be validly issued and fully paid and nonassessable, with no liability on the
part of Holder. Such Shares will not be subject to any preemptive rights.
12. Listing on Securities Exchanges, Etc. The Company will use its best
efforts to maintain the listing or inclusion of all Shares issuable or issued
from time to time upon exercise of this Warrant on each securities exchange or
market or trading system on which any shares of Common Stock are then or at any
time thereafter listed or traded, but only to the extent and for such period of
time as such shares of Common Stock are so listed or included.
13. Saturdays, Sundays, Holidays, etc. If the last or appointed day for
the taking of any action or the expiration of any right required or granted
herein shall be a Saturday or a Sunday or shall be a legal holiday, then such
action may be taken or such right may be exercised on the next succeeding day
not a Saturday, Sunday or legal holiday.
14. Adjustments and Termination of Rights. The purchase price per Share
and the number of Shares purchasable hereunder are subject to adjustment from
time to time as follows:
(a) Merger or Consolidation. If at any time there shall be a merger or a
consolidation of the Company with or into another corporation when the Company
is not the surviving corporation, then, as part of such merger or consolidation,
lawful provision shall be made so that Holder as the holder of this Warrant
shall thereafter be entitled to receive upon exercise of this Warrant, during
the period specified herein and upon payment of the aggregate Exercise Price
then in effect, the number of shares of stock or other securities or property
(including cash) of the successor corporation resulting from such merger or
consolidation, to which Holder as the holder of the Shares deliverable upon
exercise of this Warrant would have been entitled in such merger or
consolidation if this Warrant had been exercised immediately before such merger
or consolidation. In any such case, appropriate adjustment shall be made in the
application of the provisions of this Warrant with respect to the rights and
interests of Holder as the holder of this Warrant after the merger or
consolidation. This provision shall apply to successive mergers or
consolidations.
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(b) Reclassification, Recapitalization, etc. If the Company at any time
shall, by subdivision, combination or reclassification of securities,
recapitalization, automatic conversion, or other similar event affecting the
number or character of outstanding Shares, or otherwise, change any of the
securities as to which purchase rights under this Warrant exist into the same or
a different number of securities of any other class or classes, this Warrant
shall thereafter represent the right to acquire such number and kind of
securities as would have been issuable as the result of such change with respect
to the securities that were subject to the purchase rights under this Warrant
immediately prior to such subdivision, combination, reclassification or other
change.
(c) Split, Subdivision or Combination of Shares. If the Company at any
time while this Warrant remains outstanding and unexpired shall split, subdivide
or combine the securities as to which purchase rights under this Warrant exist,
the Exercise Price shall be proportionately decreased in the case of a split or
subdivision or proportionately increased in the case of a combination or reverse
split.
(d) Common Stock Dividends. If the Company at any time while this Warrant
is outstanding and unexpired shall pay a dividend with respect to Common Stock
payable in Shares, or make any other distribution with respect to Common Stock
in Shares, then the Exercise Price shall be adjusted, from and after the date of
determination of the shareholders entitled to receive such dividend or
distribution, to that price determined by multiplying the Exercise Price in
effect immediately prior to such date of determination by a fraction:
(i) the numerator of which shall be the total number of Shares
outstanding immediately prior to such dividend or distribution; and
(ii) the denominator of which shall be the total number of Shares
outstanding immediately after such dividend or distribution.
This paragraph shall apply only if and to the extent that, at the time of such
event, this Warrant is then exercisable for Common Stock.
(e) Adjustment of Number of Shares. Upon each adjustment in the Exercise
Price pursuant to Section 14(c) or 14(d) hereof, the number of Shares
purchasable hereunder shall be adjusted, to the nearest whole Share, to the
product obtained by multiplying the number of Shares purchasable immediately
prior to such adjustment in the Exercise Price by a fraction:
(i) the numerator of which shall be the Exercise Price
immediately prior to such adjustment; and
(ii) the denominator of which shall be the Exercise Price
immediately after such adjustment.
15. Notice of Adjustments; Notices. Whenever the Exercise Price or number
or type of securities issuable hereunder shall be adjusted pursuant to Section
14 hereof, the Company shall issue and provide to Holder as the holder of this
Warrant a certificate signed by an officer of the Company setting forth, in
reasonable detail, the event requiring the adjustment, the amount of the
adjustment, the method by which such adjustment was calculated and the Exercise
Price and number of Shares purchasable hereunder after giving effect to such
adjustment.
16. Limited Transfer.
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(a) This Warrant may not be sold, transferred, assigned or hypothecated by
the Holder unless and until the capital stock for the purchase of which such
Warrant is exercisable shall then be covered by an effective and current
registration statement on Form SB-2 (or any other appropriate form) under the
Securities Act and all applicable state securities laws or the Company shall
have received an opinion of counsel (which counsel is reasonably acceptable to
the Company) to the effect that the proposed sale or transfer is exempt from the
registration provisions of the Securities Act and all applicable state
securities laws. The Company may treat the registered holder of record as the
Holder for all purposes. The Company shall permit any holder of this Warrant or
his duly authorized attorney, upon written request during ordinary business
hours, to inspect and copy or make extracts from its books showing the
registered holder of warrants.
(b) Unless covered by an effective and current registration statement, the
Shares underlying this Warrant issued upon exercise of this Warrant shall be
subject to a stop transfer order and the certificate or certificates evidencing
such underlying Shares shall bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, PURSUANT TO A REGISTRATION
STATEMENT. ACCORDINGLY, SUCH SHARES MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO A REGISTRATION STATEMENT UNDER SUCH ACT, OR AN EXEMPTION FROM
REGISTRATION UNDER SUCH ACT."
17. Registration Rights. The Holder shall have the right to register the
Shares issuable upon exercise of this Warrant (in the event the Warrant is
exercised to purchase Shares), as set forth in the Registration Rights Agreement
of even date herewith, which provisions are incorporated herein and made a part
hereof.
18. Governing Law. This Warrant shall be binding upon any successors or
assigns of the Company. This Warrant shall constitute a contract under the laws
of Connecticut and for all purposes shall be construed in accordance with and
governed by the laws of said state, without giving effect to conflict of laws
principles.
19. Amendments. This Warrant may be amended and the observance of any term
of this Warrant may be waived only with the written consent of the Company and
Holder as the holder hereof.
20. Notice. All notices hereunder shall be in writing and shall be
effective:
(a) on the day on which delivered if delivered personally or transmitted
by telex, telegram or telecopier with evidence of receipt;
(b) one (1) business day after the date on which the same is delivered to
a nationally recognized overnight courier service with evidence of receipt; or
(c) five (5) business days after the date on which the same is deposited,
postage prepaid, in the U.S. mail, sent by certified or registered mail, return
receipt requested, and addressed to the party to be notified at the address
indicated below for the Company, or at the address for Holder as the holder set
forth in the registry maintained by the Company pursuant to
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Section 9, or at such other address and/or telecopy or telex number and/or to
the attention of such other person as the Company or Holder as the holder may
designate by ten (10) day advance written notice.
21. Entire Agreement. This Warrant and the forms attached hereto contain
the entire agreement between the parties with respect to the subject matter
hereof and supersede all prior and contemporaneous arrangements or undertakings
with respect thereto.
IN WITNESS WHEREOF, Ambient Corporation has caused this Warrant to be
executed by its duly authorized officer.
Dated: As of April __, 2002
AMBIENT CORPORATION NAME OF HOLDER:___________________________
Address: _________________________________
By: ______________________________ _________________________________
Its:________________________
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NOTICE OF EXERCISE
TO: AMBIENT CORPORATION
1. The undersigned hereby elects to purchase ________________ shares (the
"Shares") of common stock, $.001 par value of Ambient Corporation (the
"Company") pursuant to the terms of the attached Warrant, and tenders herewith
payment of the purchase price and any transfer taxes payable pursuant to the
terms of the Warrant.
2. The Shares to be received by the undersigned upon exercise of the
Warrant are being acquired for his, her or its own account, not as a nominee or
agent, and not with a view to resale or distribution of any part thereof, and
the undersigned has no present intention of selling, granting any participation
in, or otherwise distributing the same, except in compliance with applicable
federal and state securities laws. The undersigned further represents that he,
she or it does not have any contract, undertaking, agreement or arrangement with
any person to sell, transfer or grant participation to such person or to any
third person, with respect to the Shares. The undersigned believes he, she or it
has received all the information he, she or it considers necessary or
appropriate for deciding whether to purchase the Shares.
3. The undersigned understands that the Shares are characterized as
"restricted securities" under the federal securities laws inasmuch as they are
being acquired from the Company in transactions not involving a public offering
and that under such laws and applicable regulations such securities may be
resold without registration under the Securities Act of 1933, as amended (the
"Act"), only in certain limited circumstances. In this connection, the
undersigned represents that he, she or it is familiar with Rule 144 of the Act,
as presently in effect, and understands the resale limitations imposed thereby
and by the Act.
4. The undersigned understands the certificates evidencing the Shares may
bear one or all of the following legends:
(a) "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. THEY HAVE BEEN
ACQUIRED SOLELY FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION
WITH, THE SALE OR DISTRIBUTION THEREOF. THEY MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED, HYPOTHECATED OR OTHERWISE DISTRIBUTED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY
APPLICABLE STATE SECURITIES LAWS."
(b) Any legend required by applicable state law.
5. Please issue a certificate or certificates representing said Shares in
the name of the undersigned.
6. Please issue a new Warrant for the unexercised portion of the attached
Warrant in the name of the undersigned.
HOLDER:
__________________________________________
[Print Name]
__________________________________________
[Signature]
Address:__________________________________
__________________________________________
__________________________________________
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