EXHIBIT 4-4
Void after 5:00 p.m. New York, New York
on April 2, 2003
Warrant to Purchase 600,000 Shares of Common Stock
THIS WARRANT AND THE SHARES OF COMMON STOCK UNDERLYING THIS WARRANT
(collectively, the "Securities") HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (the "Act") AND MAY NOT BE EXERCISED
BY A "U.S. PERSON" (as defined in Section (j) hereof) OR FOR THE ACCOUNT AND
BENEFIT OF A U.S. PERSON UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT OR
AN OPINION OF COUNSEL IS DELIVERED TO THE EFFECT THAT AN EXEMPTION FROM SUCH
REGISTRATION UNDER THE ACT IS APPLICABLE FROM OR AS OTHERWISE PROVIDED IN
REGULATION S PROMULGATED UNDER SUCH ACT. IN ADDITION, NO OFFERS OR SALES OR
TRANSFERS (INCLUDING INTERESTS THEREIN) MAY BE MADE OF ANY OF THE SECURITIES IN
THE UNITED STATES OR TO A U.S. PERSON OR FOR THE ACCOUNT AND BENEFIT OF A U.S.
PERSON, UNLESS SUCH SECURITIES HAVE BEEN REGISTERED FOR RESALE UNDER THE ACT
EXCEPT AS PERMITTED BY REGULATION S OR ANOTHER EXEMPTION FROM REGISTRATION UNDER
THE ACT.
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WARRANTS TO PURCHASE COMMON STOCK
OF
UNITED LEISURE CORPORATION
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This is to certify that, FOR VALUE RECEIVED, Strata Equities Limited or
assigns ("Holder"), is entitled to purchase, subject to the provisions of this
Warrant, from United Leisure Corporation, a Delaware Corporation ("Company"),
600,000 fully paid, validly issued and non-assessable shares of Common Stock,
$.01 par value, of the Company ("Common Stock") at any time on or after the date
hereof but not later than 5:00 p.m. New York, New York Time, April 2, 2003
("Exercise Period") at an exercise price equal to Twenty Seven ($.27) per share.
The number of Shares of Common Stock to be received upon the exercise of this
Warrant and the price to be paid for each share of Common Stock may be adjusted
from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time, are hereinafter
sometimes referred to as "Warrant Shares" and the exercise price of a share of
Common Stock in effect at any time and as adjusted from time to time is
hereinafter sometimes referred to as the "Exercise Price".
(A) EXERCISE OF WARRANT. This Warrant may be exercised in whole or
in part at any time during the Exercise Period, and during the Exercise Period
the Holder shall have the right to exercise this
Warrant into the kind and amount of shares of Common Stock and other securities
and property (including cash) receivable by a holder of the number of shares of
Common Stock into which this Warrant might have been exercisable immediately
prior thereto.
(i) Mechanics of Exercise. (a) In order to exercise Warrants
into full shares of Common Stock, the Holder shall (i) fax a copy of the fully
executed notice of exercise (purchase form) in the form attached hereto ("Notice
of Exercise") to the Company at the office of the Company for the Common Stock
that the Holder elects to exercise the same, which notice shall specify the
number of Warrants to be exercised, the applicable exercise price and a
calculation of the number of Pares of Common Stock issuable upon such exercise
(together with a copy of the first page of each certificate to be exercised)
prior to Midnight, New York City time (the "Exercise Notice Deadline") on the
date of exercise specified on the Notice of Exercise and (ii) surrender the
original certificates representing the Warrants being exercised duly endorsed,
along with a copy of the Notice of Exercise together with the Warrants and the
full exercise price for the Warrants (the "Exercise Documents") no later than
Midnight, New York City time the next business day, to a common courier for
either overnight or 2-day delivery to the office of the Company. The Company
shall cause to be issued and delivered within five (5) business days after
delivery to the Company of the facsimile copies of such notice of Exercise and
such Warrants to such Holder at the address of the Holder on the books of the
Company or such other address as may be specified by such Holder, a certificate
or certificates for the number of shares of Common Stock issuable upon such
exercise of Warrants; provided, however, that the Company shall not be obligated
to issue certificates evidencing the shares of Common Stock unless either the
original Warrants have been received by the Company, or the Holder notifies the
Company or its Transfer Agent, or the Holder delivers to the Company an
affidavit and indemnification to the effect that such certificates have been
lost, stolen or destroyed, together with an appropriate indemnity bond.
(ii) The Company shall, no later than 6:00 P.M. (New York City
time) on the fifth business day (the "Deadline") after receipt by the Company of
a Notice of Exercise and a facsimile copy of the Warrant, provided the Company
has received the Exercise Documents, issue a certificate for the number of
shares of Common Stock to which the holder ("Holder") of the Security shall be
entitled as aforesaid and surrender such original Common Stock certificates to a
common courier for overnight delivery to the Holder at the address of the Holder
on the books of the Company. The Company understands that a delay in the
issuance and delivery of the shares of Common Stock beyond the Deadline could
result in economic loss to the Holder. As compensation to the Holder for such
loss, the Company agrees, provided the Company has received the Exercise
Documents, to pay late payments to the Holder for late issuance of Shares upon
exercise of Warrants of $50 per business day for each business day after the
Deadline until the shares shall be issued.
The Company shall pay any amounts incurred under this Section (ii) in
immediately available funds within five (5) business days from the date of
issuance of the applicable Common Stock. Nothing herein shall limit a ▇▇▇▇▇▇'s
right to pursue actual damages for the Company's failure to issue and deliver
shares of Common Stock to the Holder pursuant to the terms of the Warrants. In
addition, nothing herein shall limit the Holder's right to pursue actual damages
for the Company's failure to maintain a sufficient number of authorized shares
of Common Stock.
(iii) If this Warrant should be exercised in part only, the
Company shall, upon surrender of this Warrant for cancellation, execute and
deliver a new Warrant evidencing the rights of the Holder thereof to purchase
the balance of the Warrant Shares purchasable thereunder. Upon receipt by the
Company of this Warrant at its office, or by the stock transfer agent of the
Company at its office, in proper form for exercise and accompanied by payment of
the Exercise Price, the holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(iv) This Warrant is not transferable to a U.S. Person nor may
it be exercised by a U.S. Person (as defined in Section (j) hereof). The person
exercising this Warrant must certify to the Company in writing that he is not a
U.S. Person (as defined in Section (j) hereof) and is not exercising this
Warrant on behalf of a U.S. Person (as defined in Section hereof).
(B) RESERVATION OF SHARES. The Company shall at all times reserve
for issuance and/or delivery upon exercise of this Warrant such number of shares
of its Common Stock as shall be required for issuance and delivery upon exercise
of the Warrant.
(C) FRACTIONAL SHARES. No fictional shares or script representing
fractional shares shall be issued upon the exercise of this Warrant. With
respect to any fraction of a share called for upon any exercise hereof, the
Company shall pay to the Holder an amount in cash equal to such fraction
multiplied by the Current Market Value of a share, determined as follows:
(1) If the Common Stock is listed on a National Securities
Exchange or admitted to unlisted trading privileges on such exchange or listed
for trading on the NASDAQ system, the Current Market Value shall be the last
reported sale price, regular way, of the Common Stock on such exchange or system
on the last business day prior to the date of exercise of this Warrant or if no
such sale is made on such day, the average closing bid price, regular way, for
such day on such exchange or system; or
(2) If the Common Stock is not so listed or admitted to
unlisted trading privileges, the Current Market Value shall be the mean of the
last reported bid and asked prices reported by the National Quotation Bureau,
Inc. on the last business day prior to the date of the exercise of this Warrant;
or
(3) If the Common Stock is not so listed or admitted to
unlisted trading privileges and bid and asked prices are not so reported, the
Current Market Value shall be an amount not less than book value thereof as at
the end of the most recent fiscal year of the Company ending prior to the date
of the exercise of the Warrant, determined in such reasonable manner as may be
prescribed by the Board of Directors of the Company.
(D) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. Subject to
the legend first appearing above, this Warrant is exchangeable, without expense,
at the option of the Holder, upon presentation and surrender hereof to the
Company or at the office of its stock transfer agent, if any, for other warrants
of different denominations entitling the Holder thereof to purchase in the
aggregate the same number of shares of Common Stock purchasable hereunder.
Subject to the legend first appearing above, upon surrender of this Warrant to
the Company at its principal office or at the office of its stock transfer
agent, if any, with the Assignment Form annexed hereto duly executed and funds
sufficient to pay any transfer tax, the Company shall, without charge, execute
and deliver a new Warrant in the name of the assignee named in such instrument
of assignment and this Warrant shall promptly be cancelled. This Warrant may be
divided or combined with other Warrants which carry the same rights upon
presentation hereof at the principal office of the Company or at the office of
its stock transfer agent, if any, together with a written notice specifying the
names and denominations in which new Warrants are to be issued and signed by the
Holder hereof. The term "Warrant" as used herein includes any Warrants into
which this Warrant may be divided or exchanged. 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 reasonably
satisfactory indemnification, and upon surrender and cancellation of this
Warrant, if mutilated, the Company will execute and deliver a new Warrant of
like tenor and date. Any such new Warrant executed and delivered shall
constitute an additional contractual obligation on the part of the Company,
whether or not this Warrant is lost, stolen, destroyed, or mutilated shall be at
any time enforceable by anyone.
(E) RIGHTS OF THE HOLDER. The Holder shall not, by virtue hereof,
be entitled to any rights of a shareholder in the Company, either at law or
equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(F) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at any
time and the number and kind of securities purchasable upon the exercise of the
Warrants shall be subject to adjustment from time to time upon the happening of
certain events as follows:
(1) In case the Company shall (i) declare a dividend or make a
distribution on its outstanding shares of Common Stock in shares of Common Stock
or (ii) subdivide or reclassify its outstanding shares of Common Stock into a
greater number of shares, the Exercise Price in effect at the time of the record
date for such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted so that it shall
equal the price determined by multiplying the Exercise Price by a fraction, the
denominator of which shall be the number of shares of Common Stock outstanding
after giving effect to such action, and the numerator of which shall be the
number of shares of Common Stock outstanding immediately prior to such action.
Such adjustment shall be made successively whenever any event listed above shall
occur.
(2) In case the Company shall combine or reclassify its
outstanding shares of Common Stock into a smaller number of shares, the Exercise
Price in effect at the time of the record date for such combination or
reclassification shall not be adjusted and shall remain "as is" and, anything in
subsection (3) of this Section f to the contrary notwithstanding, the number of
shares shall not be adjusted and shall remain "as is."
(3) Upon each adjustment of the Exercise Price pursuant to the
provisions of this Section f, the number of Common Shares issuable upon the
exercise of this Warrant shall be adjusted to the nearest full Share by
multiplying a number equal to the Exercise Price in effect immediately prior to
such adjustment by the number of Common Shares issuable upon exercise of this
Warrant immediately prior to such adjustment and dividing the product so
obtained by the adjusted Exercise Price.
(4) No Adjustment of Exercise Price in Certain Cases. No
adjustment of the Exercise Price hereof shall be made:
(I) Upon the issuance or sale of this Warrant or the
Common Shares issuable upon the exercise of this Warrant;
or
(II) If the amount of said adjustment shall be less than
five cents ($.05) per Common Share, provided, however,
that in such case any adjustment that adjustment which,
together with any adjustment so carried forward, shall
amount to
at least five cents ($.05) per Share.
(5) Whenever the Exercise Price is adjusted, as herein
provided, the Company shall promptly cause a notice setting forth the adjusted
Exercise Price and adjusted number of shares issuable upon exercise of each
Warrant to be mailed to the Holders, at their last addresses appearing in the
Warrant Register, and shall cause a certified copy thereof to be mailed to its
transfer agent, if any. The Company may retain a firm of independent certified
public accountants selected by the Board of Directors (who may be the regular
accountants employed by the Company) to make any computation required by this
Section (f), and a certificate signed by such firm shall be conclusive evidence
of the correctness of such adjustment.
(6) In the event that at any time, as a result of an
adjustment made pursuant to this Section (f), the Holder of this Warrant
thereafter shall become entitled to receive any shares of the Company, other
than Common Stock, thereafter the number of such other shares so receivable upon
exercise of this Warrant shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Common Stock contained in this Section (f).
(7) Irrespective of any adjustments in the Exercise Price or
the number or kind of shares purchasable upon exercise of this Warrant, Warrants
theretofore or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the similar Warrants initially
issuable pursuant to this Agreement.
(G) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall be
adjusted as required by the provisions of Section (f), the Company shall
forthwith file in the custody of its Secretary or an Assistant Secretary at its
principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
including a statement of the number of additional shares of Common Stock, if
any, and such other facts as shall be necessary to show the reason for and the
manner computing such adjustment. Each such officer's certificate shall be made
available at all reasonable times for inspection by the Holder or any holder of
a Warrant executed and delivered pursuant to Section (a) and the Company shall
forthwith after each such adjustment, mail a copy by certified mail of such
certificate to the Holder or any such holder.
(H) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall be
outstanding, (i) if the Company shall pay any dividend or make any distribution
upon the Common Stock as a class or (ii) if the Company shall offer to the
holders of Common Stock for
subscription or purchase by them any share of any class or any other rights or
(iii) if the capital reorganization of the Company, reclassification of the
capital stock of the Company, consolidation or merger of the Company with or
into another corporation, sale of all or substantially all of the property and
assets of the Company to another corporation or voluntary or involuntary
dissolution, liquidation or winding up of the Company shall be effected, then in
any such case, the Company shall cause to be mailed by certified mail to the
Holder, at least ten (10) days prior to the date specified in (x) or (y) below,
as the case may be, a notice containing a brief description of the proposed
action and stating the date on which (x) a record is to be taken for the purpose
of such dividend, distribution or rights, or (y) such reclassification,
reorganization, consolidation, merger, sale, dissolution, liquidation or winding
up is to take place and date, if any is to be fixed, as of which the Holders of
the Common Stock or other securities shall receive cash or other property
deliverable upon such reclassification, reorganization, consolidation, merger,
conveyance, dissolution, liquidation or winding up. Notwithstanding the above,
the failure to give such notice shall not affect the validity of any transaction
for which the notice was required to be given.
(I) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or in which merger the Company is the continuing corporation and
which does not result in any reclassification, capital reorganization or other
change of outstanding shares of Common Stock of the class issuable upon exercise
of this Warrant or in case of any sale to another corporation of the property of
the Company as an entirety, the Company shall, as a condition precedent to such
transaction, cause effective provisions to be made so that the Holder shall have
the right thereafter by exercising this Warrant at any time prior to the
expiration of the Warrant, to purchase the kind and amount of shares of stock
and other securities and property receivable upon such reclassification, capital
reorganization and other change, consolidation, merger or sale, by a Holder of
the number of shares of Common Stock which might have been purchased upon
exercise of this Warrant immediately prior to such reclassification, change,
consolidation, merger or sale. Any such provision shall include provision for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Warrant. The foregoing provisions of this
Section (i) shall similarly apply to successive reclassification, capital
reorganizations and changes of shares of Common Stock and to successive
consolidations, mergers or sales.
(J) THE RESTRICTIVE PERIOD.
(1) The Holder of this Warrant agrees that the Holder, or any
successor, or any Professional (as defined in Section (j)(3)
hereof) (except for sales of any securities registered under The United States
Securities Act of 1933 (the "Act"), in compliance with Regulation S or otherwise
exempt from registration under the Act), (A) will not sell the Warrants and the
shares of Common Stock issuable upon exercise thereof to a U.S. Person or on
account of the benefit of a U.S. Person or any one believed to be a U.S. Person,
(B) will not engage in any efforts to sell the Warrants and the shares of Common
Stock issuable upon exercise thereof in the United States, (C) will, at the time
a buy order or transfer of the Warrants and the shares of Common Stock issuable
upon exercise thereof is originated, believe, after reasonable investigation,
that the buyer or transferee is outside the United States, and (D) will send to
a "Professional" acting as agent or principal, a confirmation or other notice
stating that the Professional is subject to the same restrictions on transfer to
U.S. Persons or for the account of U.S. Persons as provided for herein. The
Company will not honor or register, and will not be obligated to honor or
register, any transfer or exercise in violation of any of the provisions herein
or that would cause the loss of the exemption afforded by Regulation S.
(2) For purposes hereof, a "U.S. Person" shall have the
meaning set forth in Rule 902(o) of Regulation S under the Act, which includes,
without limitation, generally any natural person, resident of the United States,
any partnership or corporation organized or incorporated under the laws of the
United States; any estate of which any executor or administrator is a U.S.
Person; any trust of which any trustee is U.S. Person; any agency or branch of a
foreign entity located in the United States; any nondiscretionary account or
similar account, other than estate or trust, held by a dealer or other fiduciary
for the benefit or account of the U.S. Person; any discretionary account or
similar account, other than incorporated or, (if an individual) resident of the
United States.
(3) A "Professional" is a "distributor" as defined in Rule
902(c) of Regulation S under the Act (generally any underwriter, or other
person, who participates, pursuant to a contractual arrangement, in the
distribution of the Securities); a dealer as defined in Section 2(12) of the
U.S. Securities Act of 1934 (encompassing those who engage in the business of
trading or dealing in securities as agent, broker or principal); or a person
receiving a selling concession, fee or other enumeration in respect of the
securities sold.
(K) NON-U.S. PERSON. The Holder represents to the Company that it
is not a U.S. Person (as defined above) and he/it is not acquiring the Warrants
or the shares of Common Stock issuable upon exercise thereof for a U.S. Person
and the Holder is physically located outside the United States.
Notice hereunder may be given by personal delivery, express
courier, or registered or certified mail.
IN WITNESS WHEREOF, the Company has caused this Warrant to be
signed and attested by the Undersigned, each being duly authorized, as of the
date below.
UNITED LEISURE CORPORATION
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
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Dated: April 2, 1998
PURCHASE FORM
Dated: ,
The undersigned hereby irrevocably elects to exercise the within
Warrant to the extent of purchasing __________ Shares of Common Stock and hereby
makes payment of $___________ in payment of the actual exercise price thereof.
The undersigned hereby certifies to United Leisure Corporation, a
Delaware corporation, that he is not a U.S. Person and is not exercising this
Warrant on behalf of a U.S. Person as defined in Regulation S promulgated under
the U.S. Securities Act of 1933 and this exercise is not taking place within the
United States.
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INSTRUCTIONS FOR REGISTRATION OF STOCK
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Name:
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(Please type or print in block letters)
Address:
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Signature:
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ASSIGNMENT FORM
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FOR VALUE RECEIVED,____________________________________________________
hereby sells, assigns and transfers unto
Name:
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(Please type or print in block letters)
Address:
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the right to purchase Common Stock represented by this Warrant to the extent of
____________shares as to which such right is exercisable and does hereby
irrevocably constitute and appoint______________________________, Attorney, to
transfer the same on the books of the Company with full power of substitution in
the premises.
Date: ,
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Signature:
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