COMMON STOCK PURCHASE WARRANT (“WARRANT”)
NOVINT
TECHNOLOGIES, INC.
(“WARRANT”)
|
Warrant No.
________
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_________
Warrants
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VOID
AFTER 5:00 P.M. ALBUQUERQUE TIME
On
December4, 2013
THE
SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE BEEN ACQUIRED FOR INVESTMENT AND
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE STATE
SECURITIES LAWS OR BLUE SKY LAWS.
Novint
Technologies, Inc. (the “Company”), having its
principal office as of the date hereof at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ hereby certifies that, for value received, _____________, or
its registered assigns, is entitled, subject to the terms and conditions set
forth below, to purchase from the Company at any time on or from time to time
after December 4, 2008 (date that is the Original Issue Date), and before 5:00
P.M., Albuquerque time, on December 4, 2013 (the “Expiration
Date”), _____________ fully paid and non-assessable shares of Common
Stock (as defined below), at the initial Purchase Price per share (as defined
below) of $1.00. The number of such shares of Common Stock and the Purchase
Price per share are subject to adjustment as provided in Section 5.
1. Definitions.
As used
herein the following terms, unless the context otherwise requires, have the
following respective meanings:
“Aggregate Purchase Price” has
the meaning set forth in Section 3.1.
“Blue Sky Laws” means any state
securities or “blue sky” laws.
“Business Day” means any day
other than Saturday, Sunday or any other day on which commercial banks in The
City of New York are authorized or required by law to remain
closed.
“Company”
includes the Company and any corporation which shall succeed to or assume the
obligations of the Company hereunder. The term “corporation” shall include an
association, joint stock company, business trust, limited liability company or
other similar organization.
“Common Stock” means the
Company’s Common Stock, $0.01 par value per share, authorized as of the date
hereof.
“Delivery Date” has the meaning
set forth in Section 4.
“Exchange Act” means the
Securities Exchange Act of 1934 as the same shall be in effect at the
time.
“Holder” means any record owner
of Warrants or Underlying Securities.
“Market Price” means, for one
share of Common Stock at any date (i) if the principal trading market for the
Common Stock is an exchange, the average of the closing sale prices per share
for the last twenty (20) previous trading days in which a sale was reported, as
officially reported on any consolidated tape, (ii) if the principal market for
such securities is the over-the-counter market, the average of the closing sale
prices per share on the last twenty (20) previous trading days in which a sale
was reported as set forth by Nasdaq or, (iii) if the security is not listed on
an exchange or Nasdaq, the average of the closing sale prices per share on the
last twenty (20) previous trading days in which a sale was reported as set forth
in the National Quotation Bureau sheet listing such securities for such days.
Notwithstanding the foregoing, if there is no reported closing sale price, as
the case may be, reported on any of the twenty (20) trading days preceding the
event requiring a determination of Market Price hereunder, then the Market Price
shall be the average of the high bid and asked prices for the last ten previous
trading days in which a sale was reported; and if there is no reported high bid
and asked prices, as the case may be, reported on any of the ten trading days
preceding the event requiring a determination of Market Price hereunder, then
the Market Price shall be determined in good faith by resolution of the Board of
Directors. The Market Price of Other Securities, if any, shall be determined in
the same manner as Common Stock.
“Nasdaq” means the Nasdaq
Global Market or Nasdaq Capital Market.
“Notice” has the meaning set
forth in Section 20.
“Other Securities” refers to
any stock (other than Common Stock) and other securities of the Company or any
other Person (corporate or otherwise) which the Holders of the Warrants at any
time shall be entitled to receive, or shall have received, upon the exercise of
the Warrants, in lieu of or in addition to Common Stock, or which at any time
shall be issuable or shall have been issued in exchange for or in replacement of
Common Stock or Other Securities pursuant to Section 5 or 6.
“Person” means any individual,
sole proprietorship, partnership, corporation, limited liability company,
business trust, unincorporated association, joint stock corporation, trust,
joint venture or other entity, any university or similar institution, or any
government or any agency or instrumentality or political subdivision
thereof.
“Purchase Price per share”
means $1.00 per share, as may be adjusted from time to time in accordance with
Section 5 or 6.
“Registered” and “Registration” refer to a
registration effected by filing a registration statement in compliance with the
Securities Act, to permit the disposition of Underlying Securities issued or
issuable upon the exercise of Warrants, and any post-effective amendments and
supplements filed or required to be filed to permit any such
disposition.
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“Securities Act” means the
Securities Act of 1933 as the same shall be in effect at the time.
“Subscriber” has the meaning
set forth in the Subscription Agreement.
“Underlying Securities” means
any Common Stock or Other Securities issued or issuable upon exercise of
Warrants.
“Subscription Agreement” means
the Subscription Agreement, dated as of December 4, 2008, among the Company and
the Subscribers.
“Warrant” means, as applicable,
(i) this Warrant, and any successor or replacement Warrant, or (ii) each right
as set forth in this Warrant to purchase one share of Common Stock, as adjusted
from time to time in accordance with Section 5 or 6.
2. Sale or
Exercise Without Registration. If, at the time of any exercise or
transfer of a Warrant or of Underlying Securities previously issued upon the
exercise of Warrants, such Warrant or Underlying Securities shall not be
registered under the Securities Act, the Company may require, as a condition of
allowing such exercise or transfer, that the Holder or transferee of such
Warrant or Underlying Securities, as the case may be, furnish to the Company an
opinion of counsel, reasonably satisfactory to the Company, to the effect that
such exercise or transfer may be made without registration under the Securities
Act and without registration or qualification under any applicable Blue Sky
Laws; provided that nothing contained in this Section 2 shall relieve the Holder
from its obligations under the Subscription Agreement.
3. Exercise of
Warrant.
3.1. Exercise in
Full. Subject to the
provisions hereof, this Warrant may be exercised in full by the Holder hereof by
surrender of this Warrant, with the form of subscription at the end hereof duly
executed by such Holder, to the Company at its principal office as set forth at
the head of this Warrant (or such other location as the Company from time to
time may advise the Holder in writing), accompanied by payment, in cash, wire
transfer to the Company, or by certified or official bank check payable to the
order of the Company, in the amount obtained (the “Aggregate Purchase
Price”) by multiplying (a)
the number of shares of Common Stock then issuable upon exercise of this Warrant
by (b) the Purchase Price per share on the date of such
exercise.
3.2. Partial
Exercise. Subject to the
provisions hereof, this Warrant may be exercised in part by surrender of this
Warrant in the manner and at the place provided in Section 3.1 except that the
amount payable by the Holder upon any partial exercise shall be the amount
obtained by multiplying (a) the number of shares of Common Stock designated by
the Holder in the subscription at the end hereof by (b) the Purchase Price per
share on the date of such exercise. Upon any such partial exercise, the Company
at its expense shall forthwith issue and deliver to or upon the order of the
Holder hereof a new Warrant or Warrants of like tenor, in the name of the Holder
hereof or as such Holder (upon payment by such Holder of any applicable transfer
taxes and subject to the provisions of Section 2) may request, calling in the
aggregate on the face or faces thereof for the number of shares of Common Stock
equal to the number of such shares issuable prior to such partial exercise of
this Warrant minus the number of such shares designated by the Holder in the
subscription at the end hereof.
3.3. Limited Net
Issue Exercise. At any
time or from time to time, to the extent there is no effective registration
statement registering the resale of the Underlying Securities by the Holder,
this Warrant may also be exercised at such time by means of a “Net Issue
Exercise” in which the
Holder shall be entitled to receive Underlying Securities equal to the value of
this Warrant (or the portion thereof being exercised by Net Issue Exercise) by
surrender of this Warrant to the Company together with notice of such Net Issue
Exercise, in which event the Company shall issue to Holder a number of
Underlying Securities computed as of the date of surrender of this Warrant to
the Company using the following formula:
3
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X =
Y x
(A-B)
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|
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| A |
Where:
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X
=
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the
number of Underlying Securities to be issued to Holder pursuant to this
Section 3.5;
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Y
=
|
the
number of Underlying Securities otherwise purchasable under this Warrant,
or any lesser number of Underlying Securities as to which this Warrant is
being exercised (at the date of such
calculation);
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A
=
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the
Market Price of one share of Common Stock (at the date of such
calculation);
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B
=
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the
Purchase Price per share (as adjusted to the date of such
calculation).
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4. Delivery of
Certificates. As soon as
practicable after the exercise of this Warrant in full or in part, and in any
event within ten Business Days thereafter (the “Delivery
Date”), the Company at its
own expense (including the payment by it of any applicable issue taxes) shall
cause to be issued in the name of and delivered to the Holder hereof, or as such
Holder (upon payment by such Holder of any applicable transfer taxes and subject
to the provisions of Section 2) may direct, a certificate or certificates for
the number of fully paid and non-assessable shares of Common Stock or Other
Securities to which such Holder shall be entitled upon such exercise (with any
fractional shares being rounded to the nearest whole share).
5. Adjustment
for Stock Splits; Dividends. The number and kind of securities
purchasable upon the exercise of this Warrant and the Purchase Price shall be
subject to adjustment from time to time upon the happening of any of the
following. In case the Company shall (i) pay a dividend in shares of Common
Stock or make a distribution in shares of Common Stock to holders of its
outstanding Common Stock, (ii) subdivide its outstanding shares of Common Stock
into a greater number of shares, (iii) combine its outstanding shares of Common
Stock into a smaller number of shares of Common Stock, or (iv) issue any shares
of its capital stock in a reclassification of the Common Stock, then the number
of Underlying Securities purchasable upon exercise of this Warrant immediately
prior thereto shall be adjusted so that the Holder shall be entitled to receive
the kind and number of Underlying Securities or other securities of the Company
which it would have owned or have been entitled to receive had such Warrant been
exercised in advance thereof Upon each such adjustment of the kind and number of
Underlying Securities or other securities of the Company which are purchasable
hereunder, the Holder shall thereafter be entitled to purchase the number of
Underlying Securities or other securities resulting from such adjustment at a
Purchase Price per share or other security obtained by multiplying the Purchase
Price per share in effect immediately prior to such adjustment by the number of
Underlying Securities purchasable pursuant hereto immediately prior to such
adjustment and dividing by the number of Underlying Securities or other
securities of the Company resulting from such adjustment. An adjustment made
pursuant to this paragraph shall become effective immediately after the
effective date of such event retroactive to the record date, if any, for such
event.
6. Reorganization,
Consolidation, Merger, etc. In case the Company shall reorganize
its capital, reclassify its capital stock, consolidate or merge with or into
another corporation (where the Company is not the surviving corporation or where
there is a change in or distribution with respect to the Common Stock of the
Company), or sell, transfer or otherwise dispose of its property, assets or
business to another corporation and, pursuant to the terms of such
reorganization, reclassification, merger, consolidation or disposition of
assets, shares of common stock of the successor or acquiring corporation, or any
cash, shares of stock or other securities or property of any nature whatsoever
(including warrants or other subscription or purchase rights) in addition to or
in lieu of common stock of the successor or acquiring corporation (“Other
Property”), are to be
received by or distributed to the holders of Common Stock of the Company, then
the Holder shall have the right thereafter to receive, upon exercise of this
Warrant, the number of shares of common stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and Other
Property receivable upon or as a result of such reorganization,
reclassification, merger, consolidation or disposition of assets by a Holder of
the number of shares of Common Stock for which this Warrant is exercisable
immediately prior to such event. In case of any such reorganization,
reclassification, merger, consolidation or disposition of assets, the successor
or acquiring corporation (if other than the Company) shall expressly assume the
due and punctual observance and performance of each and every covenant and
condition of this Warrant to be performed and observed by the Company and all
the obligations and liabilities hereunder, subject to such modifications as may
be deemed appropriate (as determined in good faith by resolution of the Board of
Directors of the Company) in order to provide for adjustments of Underlying
Securities for which this Warrant is exercisable which shall be as nearly
equivalent as practicable to the adjustments provided for in this Section 6. For
purposes of this Section 6, “common stock of the successor or acquiring
corporation” shall include stock of such corporation of any class which is not
preferred as to dividends or assets over any other class of stock of such
corporation and which is not subject to redemption and shall also include any
evidences of indebtedness, shares of stock or other securities which are
convertible into or exchangeable for any such stock, either immediately or upon
the arrival of a specified date or the happening of a specified event and any
warrants or other rights to subscribe for or purchase any such stock. The
foregoing provisions of this Section 6 shall similarly apply to successive
reorganizations, reclassifications, mergers, consolidations or disposition of
assets.
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7. Further
Assurances. The Company
shall take all such action as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and non-assessable shares of
Underlying Securities upon the exercise of all Warrants from time to time
outstanding.
8. Certificate
as to Adjustments. In each
case of any adjustment or readjustment in the Underlying Securities, the Company
shall, at its expense, promptly cause its Chief Financial Officer to compute
such adjustment or readjustment in accordance with the terms of this Warrant and
prepare a certificate setting forth such adjustment or readjustment and showing
in detail the facts upon which such adjustment or readjustment is based, and the
number of shares of Common Stock or Other Securities outstanding or deemed to be
outstanding. The Company shall forthwith mail a copy of each such certificate to
the Holder.
9. Notices of
Record Date, etc. In the
event of
(a) any taking by the Company of a record
of its stockholders for the purpose of determining the stockholders thereof who
are entitled to receive any dividend or other distribution, or any right to
subscribe for, purchase or otherwise acquire any shares of stock of any class or
any other securities or property, or to receive any other right, or for the
purpose of determining stockholders who are entitled to vote in connection with
any proposed capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company or any transfer of all or
substantially all the assets of the Company to or consolidation or merger of the
Company with or into any other Person, or
(b) any voluntary or involuntary
dissolution, liquidation or winding-up of the Company,
then and
in each such event the Company shall mail or cause to be mailed to each Holder
of a Warrant a notice specifying (i) the date on which any such record is to be
taken for the purpose of such dividend, distribution or right, and stating the
amount and character of such dividend, distribution or right and (ii) the date
on which any such reorganization, reclassification, recapitalization, transfer,
consolidation, merger, dissolution, liquidation or winding-up is to take place,
and the time, if any, as of which the Holders of record of Underlying Securities
shall be entitled to exchange their shares of Underlying Securities for
securities or other property deliverable upon such reorganization,
reclassification, recapitalization, transfer, consolidation, merger,
dissolution, liquidation or winding-up. Such notice shall be mailed at least 20
days prior to the date therein specified.
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10. Reservation
of Stock Issuable on Exercise of Warrants. The Company shall at all times
reserve and keep available, solely for issuance and delivery upon the exercise
of this Warrant, all shares of Common Stock (or Other Securities) from time to
time issuable upon the exercise of this Warrant.
11. Transfer of
Warrants. Subject to the
provisions of Section 2, upon surrender for transfer of this Warrant, properly
endorsed, to the Company, as soon as practicable (and in any event within three
Business Days) the Company at its own expense shall issue and deliver to or upon
the order of the Holder thereof a new Warrant or Warrants of like tenor, in the
name of such Holder or as such Holder (upon payment by such Holder of any
applicable transfer taxes) may direct, calling in the aggregate on the face or
faces thereof for the number of shares of Common Stock called for on the face of
this Warrant so surrendered.
12. Replacement
of Warrants. Upon receipt
of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant and, in the case of any such loss,
theft or destruction, upon delivery of an indemnity agreement reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, upon surrender and cancellation of this Warrant, the Company at its
expense shall execute and deliver, in lieu thereof, a new Warrant of like
tenor.
13. Warrant
Agent. The Company may, by
written notice to each Holder of a Warrant, appoint an agent for the purpose of
issuing Common Stock (or Other Securities) upon the exercise of the Warrants
pursuant to Section 3, transferring Warrants pursuant to Section 11, and
replacing Warrants pursuant to Section 12, or any of the foregoing, and
thereafter any such issuance, transfer or replacement, as the case may be, shall
be made at such office by such agent.
14. Remedies. The Company stipulates that the
remedies at law of the Holder of this Warrant in the event of any default or
threatened default by the Company in the performance of or compliance with any
of the terms of this Warrant may not be adequate, and that such terms may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction that may be sought against a violation of
any of the terms hereof or otherwise.
15. No Rights
as Stockholder. This
Warrant does not entitle the Holder hereof to any voting rights or other rights
as a stockholder of the Company prior to the exercise
hereof.
16. Negotiability. Subject to Section 2, this Warrant is
issued upon the following terms, to all of which each Holder or owner hereof by
the taking hereof consents and agrees that: (a) subject to the provisions of
this Warrant and the Subscription Agreement, title to this Warrant may be
transferred by endorsement (by the Holder hereof executing the form of
assignment at the end hereof); and (b) until this Warrant is transferred on the
books of the Company, the Company may treat the registered Holder hereof as the
absolute owner hereof for all purposes, notwithstanding any notice to the
contrary.
17. Entire
Agreement; Successors and Assigns. This Warrant, the Note and the
Subscription Agreement constitute the entire contract between the parties
relative to the subject matter hereof. This Warrant, the Note and the
Subscription Agreement supersede any previous agreement among the parties with
respect to the subject matter hereof. The terms and conditions of this Warrant
shall inure to the benefit of and be binding upon the respective permitted
executors, administrators, heirs, successors and assigns of the parties. Nothing
in this Warrant, expressed or implied, is intended to confer upon any party,
other than the Holder and the Company, any rights, remedies, obligations or
liabilities under or by reason of this Warrant.
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18. Governing
Law. This Warrant shall be
governed by and construed in accordance with the laws of the State of Delaware
without regard to principles of conflicts of law.
19. Headings. The headings of the sections of this
Warrant are for convenience and shall not by themselves determine the
interpretation of this Warrant.
20. Notices. Any notice or other communication
required or permitted to be given hereunder (each a “Notice”) shall be given in writing and shall
be made by personal delivery or sent by courier or recognized overnight delivery
service, addressed to a party at its address shown below or at such other
address as such party may designate by three days’ advance Notice to the other
party.
Any
Notice to the Holder shall be sent to the address for such ▇▇▇▇▇▇ set forth on
books and records of the Company.
Any
Notice to the Company shall be sent to:
Novint
Technologies, Inc.
▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇
Albuquerque,
New Mexico 87114
Attention:
CEO
Each
Notice shall be deemed given and effective upon receipt (or refusal of
receipt).
21. Severability. Whenever possible, each provision of
this Warrant shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be deemed
prohibited or invalid under such applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, and such
prohibition or invalidity shall not invalidate the remainder of such provision
or any other provision of this Warrant.
22. Amendments
and Waivers. Any provision
of this Warrant may be amended and the observance of any provision of this
Warrant may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company
and the Holders of a majority of the Warrants then outstanding issued pursuant
to the Subscription Agreement. Any amendment or waiver effected in accordance
with this Section 22 shall be binding upon each Holder of such
Warrants.
23. Construction. Words (including capitalized terms
defined herein) in the singular shall be held to include the plural and vice
versa as the context requires. The words “herein”, “hereinafter”, “hereunder” and words of similar import used in
this Warrant shall, unless otherwise stated, refer to this Warrant as a whole
and not to any particular provision of this Warrant. All references to “$” in
this Warrant and the other agreements contemplated hereby shall refer to United
States dollars (unless otherwise specified expressly). Any reference to any
gender includes the other genders.
24. Assignability. Subject to Section 2, this Warrant is
fully assignable at any time.
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IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
officer thereunto duly authorized.
| NOVINT TECHNOLOGIES, INC. | |||
|
Dated: December
4, 2008
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|
By:
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| ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | |||
| Chief Executive Officer | |||
8
FORM OF
SUBSCRIPTION
(To be
signed only upon exercise of Warrant)
To:
NOVINT TECHNOLOGIES, INC.
The
undersigned, the Holder of the within Warrant, hereby irrevocably elects to
exercise the purchase right represented by such Warrant for, and to purchase
thereunder, _______________ shares of Common Stock of Novint Technologies, Inc.,
and herewith makes payment of $__________ or, subject to satisfaction of the
conditions set forth in Section 3.3 of the Warrant, [by
initial here _____] Holder elects to exercise under the Net Issue Exercise
provisions of Section 3.3 of the Warrant, and requests that the certificates for
such shares be issued in the name of, and delivered to, ___________________,
whose address is _______________________.
The
undersigned represents that the undersigned is acquiring such securities for its
own account for investment and not with a view to or for sale in connection with
any distribution thereof (except for any resale pursuant to, and in accordance
with a valid registration statement effective under the Securities Act of
1933).
Dated:
________________________________________
(Signature
must conform in all respects to the name of the Holder as specified on the face
of the Warrant)
________________________________________
(Address)
* Insert
here the number of shares called for on the face of the Warrant (or, in the case
of a partial exercise, the portion thereof as to which the Warrant is being
exercised).
i
(To be
signed by the Holder only upon transfer of Warrant)
For value
received, the undersigned hereby sells, assigns and transfers unto
_________________________ the right represented by the within Warrant to
purchase _________ shares of Common Stock of Novint Technologies, Inc. to which
the within Warrant relates, and hereby does irrevocably constitute and appoint
______________________________ Attorney to transfer such right on the books of
Novint Technologies, Inc. with full power of substitution in the
premises.
Dated:_______________
__________________________________________
(Signature
must conform in all respects to name of ▇▇▇▇▇▇ as specified on the face of the
Warrant)
__________________________________________
(Address)
ii