EXHIBIT 4.4
NEITHER THIS WARRANT, NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE
HEREOF, HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY APPLICABLE STATE SECURITIES LAW. SUCH SECURITIES MAY
NOT BE SOLD OR OTHERWISE TRANSFERRED UNLESS (I) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND SUCH APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO OR (II) IN THE OPINION OF COUNSEL REASONABLY
ACCEPTABLE TO THE COMPANY, REGISTRATION UNDER THE SECURITIES ACT AND SUCH
APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED IN CONNECTION WITH A PROPOSED
SALE OR TRANSFER.
REDEEMABLE COMMON STOCK PURCHASE WARRANT
FOR THE PURCHASE OF SHARES
OF
COMMON STOCK OF STYLING TECHNOLOGY CORPORATION
(PAR VALUE $.0001 PER SHARE)
(INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE)
VOID AFTER 5:00 P.M. EST ON JULY 3, 2002
Date of Original Issuance: JULY 3, 1997
This is to certify that, for value received, Bank Boston N.A., or its
assigns (the "Warrantholder"), is entitled, subject to the terms and conditions
hereinafter set forth, at any time after the date hereof and on or before 5:00
P.M., Eastern Standard Time, on July 3, 2002, but not thereafter, to purchase
10,000 shares of common stock, par value $.0001 per share (the "Common Stock"),
of STYLING TECHNOLOGY CORPORATION (the "Company") for the Warrant Price (as
defined below), and to receive a certificate or certificates for the shares of
Common Stock so purchased.
1. TERMS AND EXERCISE OF WARRANTS.
(a) EXERCISE PERIOD. Subject to the terms of this Warrant, the
Warrantholder shall have the right, at any time during the period (the "Exercise
Period") commencing on the date hereof and ending at 5:00 P.M., Eastern Standard
Time, on July 3, 2002 (the "Termination Date"), or if such date is a day on
which banking institutions are authorized by law to close, then on the next
succeeding day which shall not be such a day, to purchase from the Company up to
the number of fully paid and nonassessable shares of Common Stock which the
Warrantholder may at the time be entitled to purchase pursuant to this Warrant;
provided, however, the Company may redeem this Warrant prior to the Termination
Date in accordance with SECTION 2 hereof. Shares of Common Stock purchasable
pursuant to this Warrant and any other securities that the Company may be
required by the operation of SECTION 4 to issue upon the exercise hereof are
referred to hereinafter as the "Warrant Shares."
(b) METHOD OF EXERCISE. This Warrant shall be exercised by
surrender of this Warrant to the Company at its principal office, Styling
Technology Corporation, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇, Attn: Chief Financial Officer, or at such other address as the Company
may designate by notice in writing to the Warrantholder at the address of the
Warrantholder appearing on the books of the Company or such other address as the
Warrantholder may designate in writing, together with the Exercise Form included
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as EXHIBIT "A" hereto, duly completed and signed, and upon payment to the
Company of the Warrant Price (as defined in SECTION 3) multiplied by the number
of Warrant Shares being purchased upon such exercise (the "AGGREGATE WARRANT
PRICE"), together with all taxes applicable upon such exercise. Payment of the
Aggregate Warrant Price shall be made in cash or by certified check or cashier's
check, payable to the order of the Company. If, at the time of exercise thereof,
the Common Stock is listed on a national securities exchange or quoted on an
interdealer quotation system of a national securities association, any portion
of the Warrant Price may be paid by surrender to the Company of one or more
shares of Common Stock, which shall be valued for purposes of exercise at the
Daily Market Price as set forth in Section 2(e) hereof.
(c) PARTIAL EXERCISE. This Warrant shall be exercisable, at the
election of the Warrantholder, either in full or from time to time in part,
during the Exercise Period.
(d) SHARE ISSUANCE UPON EXERCISE. Upon the exercise and surrender
of this Warrant certificate and payment of such Warrant Price, the Company shall
issue and cause to be delivered with all reasonable dispatch to the
Warrantholder, in such name or names as the Warrantholder may designate in
writing, a certificate or certificates for the number of full Warrant Shares so
purchased upon the exercise of the Warrant, together with cash, as provided in
SECTION 7 hereof, with respect to any fractional Warrant Shares otherwise
issuable upon such surrender and, if applicable, the Company shall issue and
deliver a new Warrant to the Warrantholder for the number of shares not so
exercised. Such certificate or certificates shall be deemed to have been issued
and any person so designated to be named therein shall be deemed to have become
a holder of such Warrant Shares as of the close of business on the date of the
surrender of the Warrant and payment of the Warrant Price, notwithstanding that
the certificates representing such Warrant Shares shall not actually have been
delivered or that the stock transfer books of the Company shall then be closed.
2. REDEMPTION.
(a) This Warrant may be redeemed, at the option of the Company,
at a price of $0.01 per share of Common Stock purchasable upon exercise of the
Warrant upon 30 days notice after the closing bid price of the Common Stock has
equalled or exceeded two hundred percent (200%) of the Warrant Price (as defined
in SECTION 3 below), and prior to expiration of the Warrant. The Daily Market
Price of the Common Stock shall be determined by the Company in the manner set
forth in SECTION 2(E) as of the end of each trading day (or, if no trading in
the Common Stock occurred on such day, as of the end of the immediately
preceding trading day in which trading occurred). The Warrant must be redeemed
and any right to exercise the Warrant shall terminate at 5:00 p.m. (Eastern
Standard Time) on the business day immediately preceding the date fixed for
redemption. A trading day shall mean a day in which trading of securities
occurred on the New York Stock Exchange.
(b) If the Company exercises its right to redeem, it shall give
notice to the Warrantholder pursuant to SECTION 2(A), by mailing to the
Warrantholder a notice of redemption, first class, postage prepaid, at the
Warrantholder's address as it shall appear on the records of the Company. Any
notice mailed in the manner provided herein shall be conclusively presumed to
have been duly given whether or not the Warrantholder actually receives such
notice.
(c) The notice of redemption shall specify the redemption price,
the date fixed for redemption (which shall be the 30th day after such notice is
mailed), the place where the Warrant certificate shall be delivered and the
redemption price shall be paid, and that the right to exercise the Warrant shall
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terminate at 5:00 P.M. (Eastern Standard Time) on the business day immediately
preceding the date fixed for redemption.
(d) Appropriate adjustment shall be made to the redemption price
and to the minimum Daily Market Price prerequisite to redemption set forth in
SECTION 2(A) hereof, in each case on the same basis as provided in SECTION 4
hereof with respect to adjustment of the Warrant Price.
(e) For purposes of this Agreement, the term "Daily Market Price"
shall mean (i) if the Common Stock is traded in the over-the-counter market or
the Nasdaq SmallCap Market and not quoted on the Nasdaq National Market nor on
any national securities exchange, the closing bid price per share of the Common
Stock on the trading day in question, as reported by Nasdaq or an equivalent
generally accepted reporting service, or (ii) if the Common Stock is quoted on
the Nasdaq National Market or listed on a national securities exchange, the
daily per share closing price per share of the Common Stock quoted on the Nasdaq
National Market or on the principal stock exchange on which it is listed on the
trading day in question, as the case may be. For purposes of clause (i) above,
if trading in the Common Stock is not reported by Nasdaq, the bid price referred
to in said clause shall be the lowest bid price as reported in the "pink sheets"
published by National Quotation Bureau, Incorporated. The closing price referred
to in clause (ii) above shall be the last reported sale price or, in case no
such reported sale takes place on such day, the average of the reported closing
bid and asked prices, in either case on the Nasdaq National Market or on the
national securities exchange on which the Common Stock is then listed.
3. WARRANT PRICE. The price per share at which Warrant Shares shall be
purchasable on the exercise of this Warrant shall be $11.375, subject to
adjustment pursuant to SECTION 4 hereof (originally and as adjusted, the
"Warrant Price").
4. ADJUSTMENT OF WARRANT PRICE AND NUMBER OF SHARES.
The Company agrees to reserve and shall keep reserved for issuance the
number of shares of Common Stock issuable upon exercise of this Warrant. The
number and kind of securities purchasable upon the exercise of this Warrant and
the Warrant Price shall be subject to adjustment from time to time upon the
happening of certain events, as follows:
(a) In case the Company shall (1) pay a dividend or make a
distribution in shares of its Common Stock, (2) subdivide its outstanding Common
Stock into a greater number of shares, (3) combine its outstanding Common Stock
into a smaller number of shares, or (4) issue by reclassification of its Common
Stock any shares of capital stock of the Company (other than a change in par
value, or from par value to no par value, or from no par value to par value),
the Warrant Price and the number of shares of Common Stock or other securities
issuable upon exercise of this Warrant in effect immediately prior thereto shall
be adjusted so that the Warrantholder, by operation of Section 3(d) hereof,
shall be entitled to receive the number of shares which it would have owned or
have been entitled to receive immediately following the happening of any of the
events described above, had this Warrant been exercised immediately prior to the
record or effective date thereof.
An adjustment made pursuant to SECTIONS 4(a)(1)-(4) above shall
become effective immediately after the record date in the case of a dividend or
distribution (PROVIDED, HOWEVER, that such adjustments shall be reversed if such
dividends or distributions are not actually paid) and shall become effective
immediately after the effective date in the case of a subdivision, combination
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or reclassification. If, as a result of an adjustment made pursuant to this
paragraph, the Warrantholder shall become entitled to receive shares of two or
more classes of capital stock of the Company, the Board of Directors (whose
determination shall be conclusive and shall be evidenced by a resolution) shall
determine the allocation of the adjusted Warrant Price between or among the
shares of such classes of capital stock.
(b) In case of any reclassification of the outstanding Common
Stock (other than a change in par value, or from par value to no par value, or
from no par value to par value, or as a result of a subdivision, combination or
stock dividend), or in case of any consolidation of the Company with, or merger
of the Company into, another corporation wherein the Company is not the
surviving entity, or in case of any sale of all, or substantially all, of the
property, assets, business and goodwill of the Company, the Company, or such
successor or purchasing corporation, as the case may be, shall provide, by a
written instrument delivered to the Warrantholder, that the Warrantholder shall
thereafter be entitled, upon exercise of this Warrant, to the kind and amount of
shares of stock or other equity securities, or other property or assets which
would have been receivable by such Warrantholder upon such reclassification,
consolidation, merger or sale, if this Warrant had been exercised immediately
prior thereto. Such corporation, which thereafter shall be deemed to be the
"Company" for purposes of this Warrant, shall provide in such written instrument
for adjustments to the Warrant Price which shall be as nearly equivalent as may
be practicable to the adjustments provided for in this SECTION 4.
(c) No adjustment in the number of securities purchasable
hereunder shall be required unless such adjustment would require an increase or
decrease of at least five percent (5%) in the number of securities (calculated
to the nearest full share or unit thereof) then purchasable upon the exercise of
this Warrant; provided, however, that any adjustment which by reason of this
SECTION 4(c) is not required to be made immediately shall be carried forward and
taken into account in any subsequent adjustment.
(d) Whenever the Warrant Price is adjusted as provided in this
SECTION 4, the number of shares of Common Stock or other securities issuable
upon exercise of this Warrant shall be adjusted simultaneously, by multiplying
the number of shares previously issuable by a fraction, of which the numerator
shall be the Warrant Price in effect immediately prior to such adjustment, and
of which the denominator shall be the Warrant Price as so adjusted.
(e) For the purpose of this SECTION 4, the term "Common Stock"
shall mean (i) the class of stock designated as Common Stock of the Company at
July 3, 1997, or (ii) any other class of stock resulting from successive changes
or reclassifications of such Common Stock consisting solely of changes in par
value, or from par value to no par value, or from no par value to par value. In
the event that at any time, as a result of an adjustment made pursuant to this
SECTION 4, the Warrantholder shall become entitled to purchase any shares of the
Company's capital stock other than Common Stock, thereafter the number of such
other shares so purchasable upon the exercise of this Warrant and the Warrant
Price of such shares 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 shares contained in this SECTION 4.
(f) Whenever the number of shares of Common Stock and/or other
securities purchasable upon the exercise of this Warrant or the Warrant Price is
adjusted as herein provided, the Company shall cause to be promptly mailed to
the Warrantholder by first class mail, postage prepaid, notice of such
adjustment and a certificate of the Company's chief financial officer setting
forth the number of shares of Common Stock and/or other securities purchasable
upon the exercise of this Warrant, the Warrant Price after such adjustment, a
4
brief statement of the facts requiring such adjustment, and the computation by
which such adjustment was made.
(g) Irrespective of any adjustments in the Warrant Price or the
number or kind of securities purchasable upon the exercise of this Warrant, the
Warrant certificate or certificates theretofore or thereafter issued may
continue to express the same price or number or kind of securities stated in
this Warrant initially issuable hereunder.
5. TRANSFER OF WARRANT.
(a) The Warrantholder may not sell, assign, pledge, hypothecate
or otherwise transfer any right under this Warrant without the written consent
of the Company, except to any "affiliate" of the Warrantholder as defined in
Rule 144(a)(1) of the Securities Act of 1933, as amended.
(b) This Warrant and the shares of Common Stock or any other
security issued or issuable upon exercise of this Warrant may not be offered or
sold except in compliance with the Securities Act of 1933, as amended. The
Holder represents that it has acquired the Warrant and the shares of Common
Stock on exercise thereof for its own account.
(c) The Company may cause a legend in substantially the form set
forth on the first page of this Warrant on each Warrant and certificate
representing shares of Common Stock or any other security issued or issuable
upon exercise of this Warrant not theretofore distributed to the public or sold
to underwriters for distribution to the public, unless counsel for the Company
is of the opinion as to any such certificate that such legend is unnecessary.
6. REGISTRATION RIGHTS. For purposes of this SECTION 6:
(a) DEFINITIONS.
(i) The terms "register", "registered", and "registration"
refer to a registration effected by preparing and filing a registration
statement on Form S-1 or Form SB-2 or similar document in compliance with the
Act, and the declaration or ordering of effectiveness of such registration
statement or document;
(ii) The term "Registrable Securities" means the shares of
Common Stock issuable upon the exercise of this Warrant; and
(iii) The term "Holder" means Payee.
(b) PIGGYBACK REGISTRATION. If the Company proposes to register
(including for this purpose a registration effected by the Company for
stockholders other than Holder) any of its shares of Common Stock under the Act
in connection with the public offering of such securities solely for cash (other
than a registration of securities to be offered to employees pursuant to an
employee benefit plan on Form S-8, a registration in connection with an exchange
offer or any acquisition, or a registration on any form which does not include
substantially the same information as would be required to be included in a
registration statement covering the sale of the Registrable Securities), the
Company shall give Holder written notice of such proposed registration at least
thirty (30) days prior to filing the registration statement respecting such
proposed registration. Upon the written request of Holder given within twenty
5
(20) days after mailing of such notice by the Company in accordance with SECTION
12 hereof, the Company shall cause to be registered under the Securities Act all
of the Registrable Securities that Holder has requested to be registered,
subject to SECTIONS 6(C) AND 6(E) below.
(c) INFORMATION CONCERNING HOLDER. It shall be a condition
precedent of the obligations of the Company to take any action pursuant to this
SECTION 6 that Holder shall furnish to the Company such information regarding
itself, the Registrable Securities held by Holder, and the intended method of
disposition of such securities as shall be required to effect the registration
of the Registrable Securities.
(d) EXPENSES. All expenses incurred in connection with the
registration pursuant to this SECTION 6 (other than underwriter's commissions
and fees or any fees of others employed by Holder, including attorneys' fees),
including without limitation all registration, filing and qualification fees,
printer's and accounting fees, and fees and disbursements of counsel for the
Company, shall be borne by the Company.
(e) ACCEPTANCE OF UNDERWRITING AGREEMENT. The Company shall not
be required under this SECTION 6 to include any of the Registrable Securities in
an underwriting of securities being issued by the Company unless Holder accepts
the terms of the underwriting agreement as agreed upon between the Company and
the underwriter selected by the Company, and then only in such quantity, if any,
as will not, in the opinion of the managing underwriter, jeopardize or in any
way reduce the success of the offering by the Company.
(f) EXPIRATION OF PIGGYBACK REGISTRATION RIGHTS. Any obligation
of the Company to register the Registrable Securities pursuant to SECTION 6(B)
shall expire on the second anniversary of the receipt by Holder of the Warrant
Shares.
(g) SUBORDINATION OF PIGGYBACK RIGHTS. Notwithstanding anything
contained herein, the Piggyback registration rights granted under this SECTION 6
to Holder are junior and subordinate to any registration rights with respect to
any securities of the Company granted or existing prior to the date hereof.
7. FRACTIONAL INTEREST. No fractional shares or scrip representing
fractional shares shall be issuable upon the exercise of this Warrant, but on
exercise of this Warrant, the Warrantholder hereof may purchase only a whole
number of shares of Common Stock. The Company shall make a payment in cash in
respect of any fractional shares which might otherwise be issuable upon exercise
of this Warrant, calculated by multiplying the fractional shares amount by the
market price of the Company's Common Stock on the date of exercise as reported
by the national securities exchange or quoted on the interdealer quotation
system on which the Company's Common Stock is traded.
8. RESERVATION OF SHARES. The Company shall at all times reserve for
issuance such number of authorized and unissued shares of Common Stock (or other
securities substituted therefor as hereinabove provided) as shall be sufficient
for exercise of this Warrant. The Company covenants and agrees that upon
exercise of this Warrant, all shares of Common Stock issuable upon such exercise
shall be duly and validly issued, fully paid, nonassessable and not subject to
preemptive rights, rights of first refusal or similar rights of any person or
entity.
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9. BENEFITS OF THIS WARRANT. Nothing in this Warrant shall be construed
to confer upon any person other than the Company and the Warrantholder any legal
or equitable right, remedy or claim under this Warrant and this Warrant shall be
for the sole and exclusive benefit of the Company and the Warrantholder.
10. LOSS OF WARRANT. Upon receipt by the Company of evidence 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
the Company, and upon surrender the cancellation of this Warrant, if mutilated,
the Company shall execute and deliver a new Warrant of like tenor and date.
11. NOTICES. Any notice given pursuant to this Warrant by the Company or
by the Warrantholder shall be in writing and shall be deemed to have been duly
given upon (a) transmitter's confirmation of the receipt of a facsimile
transmission, (b) confirmed delivery by a standard overnight carrier, or (c) the
expiration of three business days after the day when mailed by United States
Postal Service by certified or registered mail, return receipt requested,
postage prepaid at the following addresses:
If to the Company:
Styling Technology Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
If to the Warrantholder:
To the address of the Warrantholder in the
Company's books and records.
Each party hereto may, from time to time, change the address to
which notices to it are to be transmitted, delivered or mailed hereunder by
notice in accordance herewith to the other party.
12. GENERAL PROVISIONS.
(a) SUCCESSORS. All covenants and provisions of this Warrant
shall bind and inure to the benefit of the respective executors, administrators,
successors and assigns of the parties hereto.
(b) CHOICE OF LAW. This Warrant and the rights of the parties
hereunder shall be governed by and construed in accordance with the laws of the
State of Arizona, including all matters of construction, validity, performance,
and enforcement, and without giving effect to the principles of conflict of
laws.
(c) ENTIRE AGREEMENT. Except as provided herein, this Warrant,
including exhibits, contains the entire agreement of the parties, and supersedes
all existing negotiations, representations or agreements and all other oral,
written, or other communications between them concerning the subject matter of
this Warrant.
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(d) SEVERABILITY. If any provision of this Warrant is
unenforceable, invalid, or violates applicable law, such provision shall be
deemed stricken and shall not affect the enforceability of any other provisions
of this Warrant.
(e) CAPTIONS. The captions in this Warrant are inserted only as a
matter of convenience and for reference and shall not be deemed to define,
limit, enlarge, or describe the scope of this Warrant or the relationship of the
parties, and shall not affect this Warrant or the construction of any provisions
herein.
(f) AMENDMENTS. This Warrant may be amended only by the written
agreement of the Company and the Warrantholder.
IN WITNESS WHEREOF, the Company caused this Warrant to be duly executed
as of the date first above written.
STYLING TECHNOLOGY CORPORATION, a
Delaware corporation
By: /S/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Chairman of the Board and
Chief Executive Officer
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EXHIBIT A
EXERCISE FORM
TO: STYLING TECHNOLOGY CORPORATION
The undersigned hereby irrevocably exercises the right to purchase
________ shares of the Common Stock of Styling Technology Corporation, a
Delaware corporation, evidenced by the attached Warrant, and herewith makes
payment of the Exercise Price with respect to such shares in full, all in
accordance with the conditions and provisions of said Warrant.
The undersigned agrees not to offer, sell, transfer, or otherwise
dispose of any of such Common Stock and consents that the following legend, and
any other legends required by applicable securities laws the Company deems to be
reasonable and appropriate, may be affixed to the certificates for the Common
Stock hereby subscribed for, if such legend is applicable:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Securities Act"), or any state securities law, and may not
be sold, transferred, pledged, hypothecated or otherwise
disposed of UNLESS either (i) a registration statement under
the Securities Act and applicable state securities laws shall
have become effective with regard thereto, or (ii) an exemption
from registration under the Securities Act or any applicable
state securities laws is available in connection with such
offer, sale or transfer."
The undersigned requests that certificates for such shares be issued,
and a warrant representing any unexercised portion thereof be issued, pursuant
to the Warrant in the name of the registered Warrantholder and delivered to the
undersigned at the address set forth below:
--------------------------------------------------------------------------------
Signature of Registered Warrantholder
--------------------------------------------------------------------------------
Printed Name of Registered Warrantholder
--------------------------------------------------------------------------------
Address
----------
The attached Warrant and the securities issuable on exercise thereof have not
been registered under the Securities Act of 1933, as amended, and my not be
sold, transferred, pledged, hypothecated or otherwise disposed of in the absence
of registration or the availability of an exemption from registration under said
Act.
