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EXHIBIT 10.12
THESE SECURITIES (THE "SECURITIES") HAVE BEEN (I) ACQUIRED FOR INVESTMENT; (II)
ISSUED AND SOLD IN RELIANCE UPON THE EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES LAWS OF VARIOUS STATES; AND (III) ISSUED AND SOLD IN RELIANCE UPON
THE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "1933 ACT") PROVIDED BY SECTION 4(2) OF THE 1933 ACT. THE SECURITIES
CANNOT BE OFFERED FOR SALE, SOLD OR TRANSFERRED OTHER THAN PURSUANT TO (A) AN
EFFECTIVE REGISTRATION UNDER THE 1933 ACT OR ANY TRANSACTION WHICH IS OTHERWISE
IN COMPLIANCE WITH THE 1933 ACT; AND (B) EVIDENCE SATISFACTORY TO THE ISSUER OF
COMPLIANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY OTHER JURISDICTION. THE
ISSUER SHALL BE ENTITLED TO RELY UPON AN OPINION OF COUNSEL SATISFACTORY TO IT
WITH RESPECT TO COMPLIANCE WITH THE ABOVE LAWS.
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF NOR ANY
INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED, ENCUMBERED OR IN ANY OTHER MANNER TRANSFERRED OR DISPOSED OF
EXCEPT AS PROVIDED HEREIN. THE HOLDER OF THIS WARRANT AND THE SECURITIES
ISSUABLE UPON EXERCISE HEREOF ARE SUBJECT TO THE RESTRICTIONS HEREIN SET FORTH.
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Warrant No. ______
WARRANT
TO
PURCHASE SHARES OF COMMON STOCK
OF
RED FOX INTERNATIONAL, INC.
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This Warrant (this "Warrant"), dated as of June 25, 1997 (the
"Issuance Date"), certifies that, for good and valuable consideration, Red Fox
International, Inc., a Delaware corporation (the "Company"), grants to
XxXxxxxxx, Xxxxxxxx & Company, Inc. (acting as both a beneficial owner and
nominee) and, together with any transferee of this Warrant or Warrant Shares
(as defined below) (the "Warrantholder" or "Warrantholders"), subject to the
terms and conditions set forth herein, the right to subscribe for and purchase
from the Company the number of shares (the "Warrant Shares") of the Company's
common stock ("Common Stock") which would be equivalent to 50,000 shares of
Common Stock on the closing date of the Company's initial public offering of
its Common Stock (the "IPO") pursuant to the Securities Act of 1933, as
amended, exercisable during the period from and after the Issuance Date (the
"Initial Exercise Date") to and including 5:00 p.m. Houston, Texas
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time on the date that is five years after the Initial Exercise Date (the
"Expiration Date") at a purchase price (the "Exercise Price") equal to the
lesser of (i) $8.00 per share or (ii) 70% of the initial per share public
offering price of common stock sold to the public in the IPO. In the event the
IPO has not been successfully completed on or before the date one year after
the Issuance Date (which, if applicable, shall be deemed the Initial Exercise
Date), then the Warrant shall be exercisable for 50,000 shares at a price of
$8.00 per share for a period of five years after the Initial Exercise Date
(which shall be deemed to be the Expiration Date). The Warrant Shares shall be
identical (in terms of rights and features) to the shares of Common Stock
issued by the Company in the IPO and shall be equivalent to 50,000 shares of
Common Stock issued in the IPO. The Exercise Price and the number of Warrant
Shares are subject to adjustment from time to time, as provided in Section 5.
The Exercise Price may be paid (i) in cash, by certified or official bank check
payable to the order of the Company; or (ii) by the exercise of the Warrant for
"Net Warrant Shares." Net Warrant Shares means a number of whole shares of
Common Stock, and cash in lieu of any fractional share at the MP price (defined
below), determined as described by the following formula: Net Warrant Shares =
[WS x (MP-EP)]/MP. "WS" is the number of Warrant Shares issuable upon exercise
of the Warrant or portion of the Warrant in question. "EP" shall mean the
Exercise Price. "MP" is the Market Price of the Common Stock on the last
trading day preceding the date of the request to exercise the Warrant. "Market
Price" on any day shall mean the average of the closing prices on such day of
the Common Stock on all domestic exchanges on which the Common Stock is then
listed, or, if there shall have been no sales on any such exchange on such day,
the average of the highest bid and lowest asked prices on all such exchanges at
the end of such day, or, if the Common Stock shall not be so listed, the
average of the representative bid and asked prices quoted in the NASDAQ
National Market System as of 3:30 p.m., New York time, on such day, or if the
Common Stock shall not be quoted in the NASDAQ National Market System, the
average of the high and low bid and asked prices on such day in the domestic
over-the-counter market as reported by the National Quotation Bureau,
Incorporated, or any similar successor organization. Upon the exercise of the
Warrant for Net Warrant Shares, the number of shares for which the Warrant is
thereafter exercisable shall be reduced by the corresponding number of Warrant
Shares determined in accordance with such formula (giving effect to any
fractional Net Warrant Share).
1. Duration and Exercise of Warrant, Limitation on Exercise;
Payment of Taxes.
1.1 Duration and Exercise of Warrant. The rights
represented by this Warrant may be exercised by the Warrantholder of record, in
whole, or from time to time in part (but covering at least the greater of 1,000
shares or the remaining unexercised portion of this Warrant), by surrender of
this Warrant, accompanied by the Exercise Form annexed hereto (the "Exercise
Form") duly executed by the Warrantholder of record and specifying the number
of Warrant Shares to be purchased, to the Company at the office of the Company
located at 0000 Xxxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000 (or such other
office or agency as it may designate by notice to the Warrantholder at the
address of such Warrantholder appearing on the books of the Company) during
normal business hours on any day (a "Business Day") other than a Saturday,
Sunday or a day on which the Company is otherwise closed for business (a
"Non-business Day") on or after 9:00 a.m., Houston, Texas time on the Initial
Exercise Date but not later than 5:00 p.m. on the Expiration Date (or 5:00 p.m.
on the next succeeding Business Day, if the Expiration Date is a Non-business
Day), delivery of payment to the Company of the Exercise Price for the number
of Warrant Shares specified in the Exercise Form, payable in cash or certified
bank check, and such documentation as
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to the identity and authority of the Warrantholder as the Company may
reasonably request. Such Warrant Shares shall be deemed by the Company to be
issued to the Warrantholder that is the record holder of such Warrant Shares as
of the close of business on the date on which this Warrant shall have been
surrendered and payment made for the Warrant Shares as aforesaid. Certificates
for the Warrant Shares specified in the Exercise Form shall be delivered to the
Warrantholder as promptly as practicable, and in any event within 5 business
days, thereafter. The stock certificates so delivered shall be in
denominations specified by the Warrantholder, and shall be issued in the name
of the Warrantholder or, if permitted by subsection 1.4 and in accordance with
the provisions thereof, such other name as shall be designated in the Exercise
Form. If this Warrant shall have been exercised only in part, the Company
shall, at the time of delivery of the certificates for the Warrant Shares,
deliver to the Warrantholder a new Warrant evidencing the rights to purchase
the remaining Warrant Shares, which new Warrant shall in all other respects be
identical with this Warrant. No adjustments or payments shall be made on or in
respect of Warrant Shares issuable on the exercise of this Warrant for any cash
dividends paid or payable to holders of record of Common Stock prior to the
date as of which the Warrantholder shall be deemed to be the record holder of
such Warrant Shares.
1.2 Limitation on Exercise. If this Warrant is not
exercised prior to 5:00 p.m. on the Expiration Date (or the next succeeding
Business Day, if the Expiration Date is a Non-business Day), this Warrant, or
any new Warrant issued pursuant to Section 1.1, shall cease to be exercisable
and shall become void and all rights of the Warrantholder hereunder shall
cease. This Warrant shall not be exercisable and no Warrant Shares shall be
issued hereunder, prior to 9:00 a.m. Houston, Texas time on the Initial
Exercise Date.
1.3 Payment of Taxes. The issuance of certificates for
Warrant Shares shall be made without charge to the Warrantholder for any stock
transfer or other issuance tax in respect thereto; provided, however, that the
Warrantholder shall be required to pay any and all taxes which may be payable
in respect of any transfer involved in the issuance and delivery of any
certificates for Warrant Shares in a name other than that of the then
Warrantholder as reflected upon the books of the Company.
1.4 Transfer; Restriction on Transfer and Legend.
(a) Subject to the provisions of Section 1.4(b)
below, this Warrant shall be transferable, in whole
or in part, at any time after the consummation date
of the IPO (the "IPO Date"), without the consent of
the Company, by notice from Warrantholder. The
Company shall keep at its principal office a register
in which, subject to such reasonable regulations as
it may prescribe, the Company shall provide for the
registration, transfer and exchange of this Warrant.
The Company will not at any time, except upon the
dissolution, liquidation or winding up of the
Company, close such register so as to prevent or
delay the exercise or transfer of this Warrant.
(b) Neither this Warrant nor any of the Warrant
Shares, nor any interest or participation in either,
may be in any manner transferred or
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disposed of, in whole or in part, except in
compliance with applicable United States federal and
state securities laws.
Each certificate for Warrant Shares and any Warrant issued at any time
in exchange or substitution for any Warrant bearing such a legend shall bear a
legend similar in effect to the foregoing paragraph unless, in the opinion of
counsel for the Company, the Warrant need no longer be subject to the
restriction contained herein. The provisions of this subsection 1.4 shall be
binding upon all subsequent holders of this Warrant, if any. Warrant Shares
transferred to the public as expressly permitted by, and in accordance with,
the provisions of this Warrant shall thereafter cease to be deemed to be
"Warrant Shares" for purposes hereof.
1.5 Divisibility of Warrant. This Warrant may be divided
into warrants representing one thousand Warrant Shares, multiples thereof or
the remaining unexercised portion of this Warrant, upon surrender at the
principle office of the Company on any Business Day, without charge to any
Warrantholder, except as provided below. Upon any such division, and, if
permitted by subsection 1.4 and in accordance with the provisions thereof, the
Warrants may be transferred of record to a name other than that of the
Warrantholder of record; provided, however, that the Warrantholder shall be
required to pay any and all transfer taxes with respect thereto.
1.6 Representations, Warranties and Covenants of the
Company. The Company hereby represents, warrants and covenants as follows:
(a) Existence. The Company is a corporation duly
organized and validly existing under the laws of the
State of Delaware and is authorized to do business
and is in good standing as a foreign corporation in
every jurisdiction in which it owns or leases real
property or in which the nature of its business
requires it to be so qualified, except where the
failure to so qualify, individually or in the
aggregate, could not reasonably be expected to have a
material adverse effect on the Company.
(b) Power and Authority. The Company has all
requisite corporate power and authority, and has
taken all corporate action necessary, to execute,
deliver and perform this Warrant, to grant, issue and
deliver this Warrant and to authorize and reserve for
issuance and, upon payment from time to time of the
Exercise Price, to issue and deliver the shares of
Common Stock issuable upon exercise of the Warrant.
This Warrant has been duly executed and delivered by
the Company.
(c) Reservation, Issuance and Delivery of Common
Stock. There have been reserved for issuance, and
the Company shall at all times keep reserved, out of
the authorized and unissued shares of Common Stock, a
number of shares sufficient to provide for the
exercise of the rights of purchase represented by
this Warrant, and such shares, when issued upon
receipt of payment therefor in accordance with the
terms
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of this Warrant, will be legally and validly issued,
fully paid and nonassessable and will be free of any
preemptive rights of stockholders.
(d) No Violation. Neither the execution or
delivery of this Warrant nor the consummation of the
transactions herein contemplated does or will result
in a breach or violation of any of the terms or
provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Company is
a party or by which the Company is bound or to which
any of the property or assets of the Company is
subject, nor will such action result in any violation
of any provision of the Certificate of Incorporation
or Bylaws of the Company or any statute or any order,
rule or regulation or any court or governmental
agency or body having jurisdiction over the Company
or any of its properties.
(e) Valid and Binding Obligation. This Warrant,
when duly executed and delivered, will constitute
legal, valid and binding obligation of the Company,
enforceable in accordance with its terms, subject to
any applicable bankruptcy, insolvency or other laws
of general application affecting creditors' rights
and judicial decisions interpreting any of the
foregoing.
2. Reservation and Listing of Shares. All Warrant Shares which
are issued upon the exercise of the rights represented by this Warrant shall,
upon issuance and payment of the Exercise Price, be validly issued, fully paid
and nonassessable and free, from all taxes, liens, security interests, charges
and other encumbrances with respect to the issue thereof other than taxes in
respect of any transfer occurring contemporaneously with such issue. During
the period within which this Warrant may be exercised, the Company shall at all
times have authorized and reserved, and keep available free from preemptive
rights, a sufficient number of shares of Common Stock to provide for the
exercise of this Warrant, and shall at its expense procure such listing thereof
(subject to official notice of issuance) as then may be required on all stock
exchanges on which the Common Stock is then listed. The Company shall, from
time to time, take all such action as may be required to assure that the par
value per share of the Warrant Shares is at all time equal to or less than the
then effective Exercise Price.
3. Exchange, Loss or Destruction of Warrant. If permitted by
subsection 1.4 or 1.5 and in accordance with the provisions thereof, upon
surrender of this Warrant to the company with a duly executed instrument of
assignment and funds sufficient to pay any transfer tax, the company shall,
without charge, execute and deliver a new Warrant of like tenor in the name of
the assignee named in such instrument of assignment and this Warrant shall
promptly be canceled. Upon receipt by the Company of evidence satisfactory to
it of the loss, theft, destruction or mutilation of this Warrant, and, in the
case of loss, theft or destruction, of such bond or indemnification as the
Company may reasonably require, and, in the case of such mutilation, upon
surrender and cancellation of this
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Warrant, the Company will execute and deliver a new Warrant of like tenor. The
term "Warrant" as used herein includes any Warrants issued in substitution or
exchange of this Warrant.
4. Ownership of Warrant. The Company may deem and treat the
person in whose name this Warrant is registered as the holder and owner hereof
(notwithstanding any notations of ownership) or writing hereon made by anyone
other than the Company) for all purposes and shall not be affected by any
notice to the contrary, until presentation of this Warrant for registration of
transfer as provided in subsections 1.1, 1.4 and 1.5 or in Section 3.
5. Certain Adjustments. The Exercise Price at which Warrant
Shares may be purchased hereunder, and the number of Warrant Shares to be
purchased upon exercise hereof, are subject to change or adjustment after the
Issuance Date as follows:
5.1 General. The number of Warrant Shares purchasable
upon the exercise of this Warrant and the Exercise Price shall be subject to
adjustment as follows:
(a) In the case the Company shall after August
30, 1997 (i) pay a dividend in shares of Common Stock
or make a distribution in shares of Common Stock,
(ii) subdivide its outstanding shares of Common Stock
into a greater number of shares of Common Stock,
(iii) combine its outstanding shares of Common Stock
into a smaller number of shares of Common Stock or
(iv) issue by reclassification of its shares of
Common Stock other securities of the Company
(including any such reclassification in connection
with a consolidation or merger in which the Company
is the surviving corporation), the number of Warrant
Shares purchasable upon exercise of this Warrant
shall be adjusted so that the Warrantholder shall be
entitled to receive the kind and number of Warrant
Shares or other securities of the Company that the
Warrantholder would have owned or have been entitled
to receive after the happening of any of the events
described above, had this Warrant been exercised
immediately prior to the happening of such event or
any record date with respect thereto. An adjustment
made pursuant to this paragraph 5.1(1) shall become
effective immediately after the effective date of
such event retroactive to the record date, if any,
for such event.
(b) As of the IPO Date, the number of Warrant
Shares purchasable upon exercise of this Warrant
shall be automatically adjusted, without action by
any party, so that the Warrantholder shall be
entitled to receive the equivalent of 50,000 shares
of Common Stock as of the IPO Date.
(c) In the case the Company shall after August
30, 1997:
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(i) issue rights, options or warrants
generally to holders of its outstanding
Common Stock, without any charge to such
holders, entitling them at the time of such
issuance to subscribe for or purchase,
pursuant to such an issuance, shares of
Common Stock at a price per share which is
lower at the record date for the
determination of stockholders entitled to
receive such rights, options or warrants than
the then current Market Price per share of
Common Stock, or
(ii) distribute generally to holders of
its shares of Common Stock evidences of its
indebtedness or assets (excluding cash
dividends or distributions and dividends or
distributions referred to in paragraph 5.1(1)
of this subsection 5.1) or rights, options or
warrants, or convertible or exchangeable
securities containing the right to subscribe
for or purchase shares of Common Stock.
Appropriate adjustments shall be made to the number of Warrant Shares
purchasable upon the exercise of the Warrant and/or the Exercise Price in order
to preserve the relative rights and interests of the Warrantholders, such
adjustments to be made by the good faith determination of the Board of
Directors of the Company; provided, however, that in the event such rights,
options, warrants or distributions (other than cash dividends) are for the
purpose of providing compensation to officers, directors or employees of the
Company and not for the benefit of securities holders generally, no such
adjustment shall be provided.
5.2 Voluntary Adjustment by the Company. The company
may, at its option, at any time during the term of the Warrant, reduce the then
current Exercise Price to any amount consistent with applicable law, deemed
appropriate by the Board of Directors of the Company.
5.3 Notice of Adjustment. Whenever the number of Warrant
Shares or the Exercise Price of such Warrant Shares is adjusted, as herein
provided, the company shall promptly mail first class, postage prepaid, to all
Warrantholders, notice of such adjustment.
5.4 No Adjustment for Cash Dividends. No adjustment in
respect of any cash dividends shall be made during the term of this Warrant or
upon the exercise of this Warrant.
5.5 Preservation of Purchase Rights Upon Merger,
Consolidation, etc. In case of any consolidation of the Company with or merger
of the Company into another person or in case of any sale, transfer or lease to
another corporation of all or substantially all of the assets of the Company,
the company or such successor or purchaser, as the case may be, shall execute
with the Warrantholders an agreement that the Warrantholders shall have the
right thereafter upon payment of the Exercise Price in effect immediately
prior to such action to purchase upon exercise of each Warrant the kind and
amount of shares and other securities and property that the holder thereof
would have owned or have been entitled to receive after the happening of such
consolidation, merger, sale, transfer or lease had such Warrant been exercised
immediately prior to such action; provided, however, that no adjustment in
respect of cash dividends, interest or other income on or
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from such shares or other securities and property shall be made during the term
of this Warrant or upon the exercise of this Warrant. Such agreement shall
provide for adjustment, which shall be as nearly equivalent as practicable to
the adjustments provided for in this Section 5. The provisions of this
subsection 5.5 shall apply similarly to successive consolidations, mergers,
sales, transfers or leases.
6. Registration Rights.
6.1 Piggy-back Registration Rights. The Company
covenants and agrees that in the event the Company proposes to file a
registration statement under the Securities Act of 1933, as amended (the
"Act"), subsequent to the IPO and prior to the Expiration Date, with respect to
the offering of Common Stock (other than in connection with an exchange offer
or a registration statement on Form S-4, Form S-8 or other form of registration
statement not available to register securities so requested to be included),
the Company shall in each case give written notice of such proposed filing to
(i) if this Warrant has been exercised, the holders of the Warrant Shares and
(ii) if this Warrant has not been exercised, the Warrantholders, in each case
at least 20 days before the earlier of the anticipated or the actual effective
date of the registration statement and at least ten days before the initial
filing of such registration statement, and such notice shall offer to such
Warrantholders the opportunity to include in such registration statement such
number of Warrant Shares as they may request. Warrantholders desiring
inclusion of Warrant Shares in such registration statement shall so inform the
Company by written notice, given with 10 days of the giving of such notice by
the Company in accordance with the provisions of Section 8.6 hereof. The
Company shall permit, or shall cause the managing underwriter of a proposed
offering to permit, the holders of Warrant Shares requested to be included in
the registration to include such securities in the proposed offering on the
same terms and conditions as applicable to any similar securities of the
Company, if any, included therein for the account of any person other than the
Company and the holders of Warrants and/or Warrant Shares. The Company shall
continuously maintain in effect any registration statement with respect to
which the Warrant Shares have been requested to be included (and so included)
for a period of not less than (i) 180 days after the effectiveness of such
registration statement of (ii) the consummation of the distribution by the
Warrantholders of the Warrant Shares ("Piggy-back Termination Date"); provided,
however, that if at the Piggy-back Termination Date the Warrant Shares are
covered by a registration statement which is, or is required to remain, in
effect beyond the Piggy-back Termination Date, the company shall maintain in
effect the registration statement as it relates to the Warrant Shares for so
long as such registration statement remains or is required to remain in effect
for any of such other securities. All expenses of such registration shall be
borne by the Company, except that underwriting commissions and expenses
attributable to the Warrant Shares and fees and distributions of counsel (if
any) to the Warrantholders requesting that the Warrant Shares be offered will
be borne by such Warrantholders.
6.2 Other Matters. In connection with the registration
of Warrant Shares in accordance with Section 6.1 above, the Company agrees to:
(a) Use its best efforts to register or qualify
the Warrant Shares for offer or sale under state
securities or Blue Sky laws of such jurisdictions in
which the holders of such Warrants and/or Warrant
Shares shall reasonably designate; provided, that in
no event shall the
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Company be obligated to qualify to do business in any
jurisdiction where it is not now so qualified or to
take any action which would subject it to general
service of process or taxation in any jurisdiction
where it is not now so subject, and use its best
efforts to do any and all other acts and things which
may be necessary or advisable to enable the
Warrantholders to consummate the sale, transfer or
other disposition of such securities in any
jurisdiction.
(b) Enter into indemnity and contribution
agreements, each in customary form, with each
underwriter, if any, and each holder of Warrant
Shares included in such registration statement; and,
if requested, enter into an underwriting agreement
containing customary representations, warranties,
covenants, allocation of expenses, and customary
closing conditions including, but not limited to,
opinions of counsel, and accountants' cold comfort
letters with any underwriter who participates in the
offering of Warrant Shares; and
(c) Pay all expenses in connection with the
registration of the Warrants and/or Warrant Shares
under the Act and compliance with the provisions of
clause 6.2(1) above.
In connection with the registration of
Warrant Shares in accordance with Section 6.1 above,
the Warrantholders agree to enter into an
underwriting agreement containing customary
representations, warranties, covenants, allocation of
expenses (not otherwise inconsistent with this
Warrant), and customary closing conditions, with any
underwriter who participates in the offering of
Warrant Shares.
7. Restriction on Transfer. Not withstanding the registration
rights granted to Warrantholder pursuant to the provisions of Section 6 of this
Warrant, the Warrantholder hereby agrees that for a period of one year
following the date of the IPO, the Warrantholder will not, without the prior
written consent of Xxxxxxxxx & Company, Inc., directly or indirectly, offer to
sell, assign, pledge, issue, distribute, sell, contract to sell, grant any
option or enter into any contract for the sale of, or otherwise voluntarily
transfer or dispose of, or announce any offer, sale, grant of any option to
purchase or other transfer or disposition of, any Warrant Shares.
8. No Impairment. The Company shall not by any action,
including, without limitation, amending its Certificate of Incorporation 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 of this
Warrant, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such actions as may be necessary or
appropriate to protect the rights of the Warrantholders against impairment.
Without limiting the generality of the foregoing, the Company will (a) not
change the par value of any shares of Common Stock receivable upon the exercise
of this Warrant to an amount greater than the amount payable therefor upon such
exercise, (b) take all such action as may be necessary or appropriate in
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order that the Company may validly and legally issue fully paid and
non-assessable shares of Common Stock upon the exercise of this Warrant, (c)
obtain all such authorizations, exemptions or consents from any public
regulatory body having jurisdiction thereof as may be necessary to enable the
Company to person its obligations under this Warrant, and (d) not undertake any
reverse stock split, combination, reorganization or other reclassification of
its capital stock which would have the effect of making this Warrant
exercisable for less than one share of Common Stock.
Upon the request of a Warrantholder, the company will at any time
during the period this Warrant is outstanding acknowledge in writing, in form
reasonably satisfactory to such Warrantholder, the continued validity of this
Warrant and the Company's obligations hereunder.
9. Miscellaneous.
9.1 Entire Agreement. This Warrant constitutes the
entire agreement between the Company and the Warrantholders with respect to
this Warrant and the Warrant Shares.
9.2 Binding Effects; Benefits. This Warrant shall inure
to the benefit of and shall be binding upon the Company, the Warrantholders and
holders of Warrant Shares and their respective heirs, legal representatives,
successors and assigns. Nothing in this Warrant, expressed or implied, is
intended to or shall confer on any person other than the Company, the
Warrantholders and holders of Warrant Shares, or their respective heirs, legal
representatives, successors or assigns, any rights, remedies, obligations or
liabilities under or by reason of this Warrant or the Warrant Shares.
9.3 Amendments and Waivers. This Warrant may not be
modified or amended except by an instrument in writing signed by the Company
and the Warrantholders. The company, and Warrantholder or holders of Warrant
Shares may, by an instrument in writing, waive compliance by the other party
with any term or provision of this Warrant on the part of such other party
hereto to be performed or complied with. The waiver by any such party of a
breach of any term or provision of this Warrant shall not be construed as a
waiver of any subsequent breach.
9.4 Section and Other Headings. This section and other
headings contained in this Warrant are for reference purposes only and shall
not be deemed to be a part of this Warrant or to affect the meaning or
interpretation of this Warrant.
9.5 Further Assurances. Each of the Company, the
Warrantholders and holders of Warrant Shares shall do and perform all such
further acts and things and execute and deliver all such other certificates,
instruments and/or powers of attorney as may be necessary or appropriate as any
party hereto may, at any time and from time to time, reasonably request in
connection with the performance of any of the provisions of this Warrant.
9.6 Notices. All demands, requests, notices and other
communications required or permitted to be given under this Warrant shall be in
writing and shall be deemed to have been duly given if delivered personally or
sent by United States certified or registered mail, postage prepaid, to the
parties hereto at the following addresses or at such other address as any party
hereto shall hereafter specify by notice to the other party hereto:
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(a) if to the Company, addressed to:
Red Fox International, Inc.
0000 Xxxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: President
(b) if to any Warrantholder or holder of Warrant
Shares, addressed to the address of such person
appearing on the books of the Company.
Except as otherwise provided herein, all such
demands, requests, notices and other communications
shall be deemed to have been received on the date of
personal delivery thereof or on the third Business
Day after the mailing thereof.
9.7 Separability. Any term or provision of this Warrant
which is invalid or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable any other term or
provision of this Warrant or affecting the validity or enforceability of any of
the terms or provisions of this Warrant in any other jurisdiction.
9.8 Fractional Shares. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant. Except as otherwise provided herein, with respect to any fraction of
a share called for upon any exercise hereof, the Company shall pay to the
Warrantholder an amount in cash equal to such fraction multiplied by the
then-current Market Price.
9.9 Rights of the Holder. No Warrantholder shall, solely
by virtue of this Warrant, be entitled to any rights of a stockholder of the
Company, either at law or in equity.
9.10 Governing Law. This Warrant shall be deemed to be a
contract made under the laws of the State of Delaware and for all purposes
shall be governed by and construed in accordance with the laws of such State
applicable to contracts made and performed in Delaware.
9.11 Expenses. The Company shall pay all reasonable legal
and other reasonable out-of-pocket expenses of the Warrantholders and their
counsel in connection with the exercise and sale of the Warrant Shares as
contemplated by this Warrant.
9.12 Right to Information. The company will provide to a
Warrantholder and to all holders of Warrant Shares, on a timely basis, copies
of all documents and reports filed with the Securities and Exchange Commission
(the "Commission") and publicly available annual and quarterly financial
statements, as may be requested in writing by the Warrantholder or as otherwise
agreed in another agreement between the Company and the Warrantholder.
9.13 Merger or Consolidation of the Company. So long as
this Warrant remains in effect, the Company will not merge or consolidate with
or into, or sell, transfer or lease all or
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substantially all of its property to, any other corporation unless the
successor or purchasing corporation, as the case may be (i) shall be the
Company or (ii) if not the Company, shall expressly assume, by supplemental
agreement executed and delivered to the Warrantholders, the performance and
observance of each and every covenant and condition of this Warrant to be
performed and observed by the Company under this Warrant.
9.14 Rule 144. With a view to making available to
Warrantholders the benefits of certain rules of the Commission that may permit
the sale of shares of Common Stock to the public without registration, in the
event that the IPO is successfully completed by the Company, the Company hereby
covenants and agrees to use its reasonable business efforts after the Initial
Exercise Date to file in a timely manner all reports and other documents
required to be filed by it under the Act and the Securities Exchange Act of
1934, as amended, and the rules and regulations adopted by the Commission
thereunder necessary to permit sales under Rule 144 under the Act, and the
Company will take such further action which does not have material costs to the
Company to the extent required form time to time to enable Warrantholders to
sell shares of Common Stock (whether or not any such securities have been the
subject of a piggy-back request pursuant to the agreement set forth in Section
6 hereof) without registration under the Act within the limitation of the
exemptions provided by (a) Rule 144 under the Act, as such Rule may be amended
from time to time, or (b) any similar rule or regulation hereafter adopted by
the Commission. Upon the written request of a Warrantholder, the Company will
deliver to such Warrantholder a written statement as to whether it has complied
with such requirements.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
by its duly authorized officer as of the date first written above.
Red Fox International, Inc.
By:
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X. Xxxxx Xxxx, President
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EXERCISE FORM
(To be executed upon exercise of this Warrant)
The undersigned, record holder of this Warrant, hereby irrevocably
elects to exercise the right, represented by this Warrant, to purchase
___________________ of the Warrant Shares and herewith tenders payment for such
Warrant Shares to the order of Red Fox International, Inc. in the amount of
$_________________ in accordance with the terms of this Warrant. The
undersigned requests that a certificate for such Warrant Shares be registered
in the name of _____________________ and that such certificate be delivered to
________________________________________________________ whose address is _____
__________________________________________________________________.
Date: Signature:
-------------------- ------------------------------
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(Name Printed)
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