YOUNGEVITY INTERNATIONAL, INC. COMMON STOCK PURCHASE WARRANT
Exhibit 4.23
THIS
PURCHASE WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF
MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED,
OR BE THE SUBJECT OF ANY HEDGING, SHORT SALE, DERIVATIVE, PUT, OR
CALL TRANSACTION THAT WOULD RESULT IN THE EFFECTIVE ECONOMIC
DISPOSITION OF SUCH SECURITIES BY ANY PERSON FOR A PERIOD OF ONE
HUNDRED EIGHTY (180) DAYS IMMEDIATELY FOLLOWING THE EFFECTIVE DATE
OF THE PUBLIC OFFERING OF THE COMPANY’S SECURITIES PURSUANT
TO REGISTRATION STATEMENT (FILE NO. 333-221847), AS FILED WITH THE
U.S. SECURITIES AND EXCHANGE COMMISSION, EXCEPT IN ACCORDANCE WITH
FINRA RULE 5110(g)(2).
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Warrant
Shares: [ ]
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Issuance
Date: [●], 2018
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THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that,
for value received, Tripoint
Global Equities, LLC or its assigns
(the “Holder”) is entitled, upon
the terms and subject to the limitations on exercise and the
conditions hereinafter set forth, at any time on or after the date
that is 180 days after the effective date of the Registration
Statement (the “Initial
Exercise Date”) and on or before 5:00 p.m., Eastern
Time, on the five (5) year anniversary of the effective date of the
Registration Statement (the “Termination Date”) but not
thereafter, to subscribe for and purchase from Youngevity
International, Inc., a Delaware corporation (the
“Company”), up
to [ ] shares (as subject to adjustment hereunder,
the “Warrant
Shares”) of Common Stock. The purchase price of one
share of Common Stock under this Warrant shall be equal to the
Exercise Price, as defined in Section 2(b).
Section 1. Definitions.
Capitalized terms
used and not otherwise defined herein shall have the meanings set
forth in the Selling Agency Agreement, dated [ ], 2018
(the “Agreement”), between the
Company and Tripoint Global Equities, LLC.
Section 2. Exercise.
(a) Method
of Exercise. Exercise of the purchase rights represented by
this Warrant may be made, in whole or in part, at any time or times
on or after the Initial Exercise Date and on or before the
Termination Date by delivery to the Company (or such other office
or agency of the Company as it may designate by notice in writing
to the registered Holder at the address of the Holder appearing on
the books of the Company) of a duly executed facsimile copy of the
Notice of Exercise form annexed hereto (the “Notice of
Exercise”). Within three (3) trading days after the date of
exercise as aforesaid, the Holder shall deliver the aggregate
Exercise Price for the shares specified in the applicable Notice of
Exercise by wire transfer or cashier’s check drawn on a
United States bank unless the cashless exercise procedure specified
in Section 2(c) below is available and specified in the applicable
Notice of Exercise. Notwithstanding anything herein to the
contrary, the Holder shall not be required to physically surrender
this Warrant to the Company until the Holder has purchased all of
the Warrant Shares available hereunder and the Warrant has been
exercised in full, in which case, the Holder shall surrender this
Warrant to the Company for cancellation within three (3) trading
days of the date the final Notice of Exercise is delivered to the
Company. Partial exercises of this Warrant resulting in purchases
of a portion of the total number of Warrant Shares available
hereunder shall have the effect of lowering the outstanding number
of Warrant Shares purchasable hereunder in an amount equal to the
applicable number of Warrant Shares purchased. The Holder and the
Company shall maintain records showing the number of Warrant Shares
purchased and the date of such purchases; provided that the records
of the Company, absent manifest error, will be conclusive with
respect to the number of Warrant Shares purchasable from time to
time hereunder. The Company shall deliver any objection to any
Notice of Exercise within one (1) business day after receipt of
such notice. The Holder and
any assignee, by acceptance of this Warrant, acknowledge and agree
that, by reason of the provisions of this paragraph, following the
purchase of a portion of the Warrant Shares hereunder, the number
of Warrant Shares available for purchase hereunder at any given
time may be less than the amount stated on the face
hereof.
(b) Exercise
Price. The exercise price per share of the Common Stock
under this Warrant shall be $5.70, subject to adjustment hereunder
(the “Exercise
Price”). Except as where otherwise permitted in
accordance with Section 2(c), this Warrant may only be exercised by
means of payment by wire transfer or cashier’s check drawn on
a United States bank.
-1-
(c) Cashless
Exercise. If at any time after the Initial Exercise Date
there is no effective registration statement registering, or no
current prospectus available for, the resale of the Warrant Shares
by the Holder, then in lieu of exercising this Warrant at such time
by payment of cash or check payable to the order of the Company
pursuant to Section 2.1 above, this Warrant may at the option of
the Holder be exercised, in whole or in part, at such time by means
of a “cashless exercise” in which the Holder shall be
entitled to receive a number of Warrant Shares equal to the
quotient obtained by dividing [(A-B) (X)] by (A),
where:
(A) =
the VWAP on the trading day immediately preceding the date on which
Holder elects to exercise this Warrant by means of a
“cashless exercise,” as set forth in the applicable
Notice of Exercise;
(B) =
the Exercise Price of this Warrant, as adjusted hereunder;
and
(X) =
the number of Warrant Shares that would be issuable upon exercise
of this Warrant in accordance with the terms of this Warrant if
such exercise were by means of a cash exercise rather than a
cashless exercise.
“VWAP” means, for any date, the
price determined by the first of the following clauses that
applies: (a) if the Common Stock is then listed or quoted on a
Trading Market (as defined below), the daily volume weighted
average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is
then listed or quoted as reported by Bloomberg L.P. (“Bloomberg”) (based on a
trading day from 9:30 a.m., Eastern time, to 4:00 p.m., Eastern
time), (b) if the OTC Bulletin Board or any market, exchange or
quotation system maintained by the OTC Markets Group, Inc.,
including, without limitation, OTCQB, OTCQX or OTC Pink (or any
successors of the foregoing) is not a Trading Market and the Common
Stock is then traded on such market, exchange or quotation system,
the volume weighted average price of the Common Stock for such date
(or the nearest preceding date) on such market, exchange or
quotation system or (c) in all other cases, the fair market value
of a share of Common Stock as determined by an independent
appraiser selected in good faith by the board of directors of the
Company and reasonably acceptable to the Holder, the fees and
expenses of which shall be paid by the Company.
“Trading Market” means the NASDAQ
National Market, the market on which the Common Stock is currently
quoted.
(d) Mechanics
of Exercise.
(i) Delivery
of Warrant Shares Upon Exercise. The Company shall use best
efforts to cause the Warrant Shares purchased hereunder to be
transmitted by the Company’s stock transfer agent and
registrar (the “Transfer
Agent”) to the Holder by physical delivery to the
address specified by the Holder in the Notice of Exercise by the
date that is five (5) trading days after the latest of (A) the
delivery to the Company of the Notice of Exercise, (B) surrender of
this Warrant (if required) and (C) payment of the aggregate
Exercise Price as set forth above (including by cashless exercise,
if permitted) (such date, the “Warrant Share Delivery
Date”). The Warrant Shares shall be deemed to have
been issued, and the Holder or any other person so designated to be
named therein shall be deemed to have become a holder of record of
such shares for all purposes, as of the date the Warrant has been
exercised, with payment to the Company of the Exercise Price (or by
cashless exercise, if permitted) and all taxes required to be paid
by the Holder, if any, pursuant to Section 2(d)(vi) before the
issuance of such shares, having been paid.
(ii) Delivery
of New Warrants Upon Exercise. If this Warrant shall have
been exercised in part, the Company shall, at the request of a
Holder and upon surrender of this Warrant, at the time of delivery
of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased
Warrant Shares called for by this Warrant, which new Warrant shall
in all other respects be identical with this Warrant.
(iii) Rescission
Rights. If the Company fails to cause the Transfer Agent to
transmit to the Holder the Warrant Shares pursuant to Section
2(d)(i) by the Warrant Share Delivery Date, then the Holder will
have the right to rescind such exercise.
(iv) Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon
Exercise. In addition to any other rights available to the
Holder, if the Company fails to cause the Transfer Agent to
transmit to the Holder the Warrant Shares pursuant to an exercise
on or before the Warrant Share Delivery Date, and if after such
date the Holder is required by its broker to purchase (in an open
market transaction or otherwise) or the Holder’s brokerage
firm otherwise purchases, shares of Common Stock to deliver in
satisfaction of a sale by the Holder of the Warrant Shares which
the Holder anticipated receiving upon such exercise
(a “Buy-In”), then the Company
shall (A) pay in cash to the Holder the amount, if any, by which
(x) the Holder’s total purchase price (including brokerage
commissions, if any) for the shares of Common Stock so purchased
exceeds (y) the amount obtained by multiplying (1) the number of
Warrant Shares that the Company was required to deliver to the
Holder in connection with the exercise at issue times (2) the price
at which the sell order giving rise to such purchase obligation was
executed, and (B) at the option of the Holder, either reinstate the
portion of the Warrant and equivalent number of Warrant Shares for
which such exercise was not honored (in which case such exercise
shall be deemed rescinded) or deliver to the Holder the number of
shares of Common Stock that would have been issued had the Company
timely complied with its exercise and delivery obligations
hereunder. For example, if the Holder purchases Common Stock having
a total purchase price of $11,000 to cover a Buy-In with respect to
an attempted exercise of shares of Common Stock with an aggregate
sale price giving rise to such purchase obligation of $10,000,
under clause (A) of the immediately preceding sentence the Company
shall be required to pay the Holder $1,000. The Holder shall
provide the Company written notice indicating the amounts payable
to the Holder in respect of the Buy-In and, upon request of the
Company, evidence of the amount of such loss. Nothing herein shall
limit a Holder’s right to pursue any other remedies available
to it hereunder, at law or in equity including, without limitation,
a decree of specific performance and/or injunctive relief with
respect to the Company’s failure to timely deliver shares of
Common Stock upon exercise of the Warrant as required pursuant to
the terms hereof.
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(v) No
Fractional Shares or Scrip. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of
this Warrant. As to any fraction of a share which the Holder would
otherwise be entitled to purchase upon such exercise, the Company
shall, at its election, either pay a cash adjustment in respect of
such final fraction in an amount equal to such fraction multiplied
by the Exercise Price or round up to the next whole
share.
(vi) Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made
without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of such Warrant
Shares, all of which taxes and expenses shall be paid by the
Company, and such Warrant Shares shall be issued in the name of the
Holder or in such name or names as may be directed by the
Holder; provided, however, that, in the event
Warrant Shares are to be issued in a name other than the name of
the Holder, this Warrant when surrendered for exercise shall be
accompanied by the assignment form attached hereto duly executed by
the Holder and the Company may require, as a condition thereto, the
payment of a sum sufficient to reimburse it for any transfer tax
incidental thereto. The Company shall pay all Transfer Agent fees
required for same-day processing of any Notice of
Exercise.
(vii) Closing
of Books. The Company will not close its stockholder books
or records in any manner which prevents the timely exercise of this
Warrant, pursuant to the terms hereof.
(e) Holder’s
Exercise Limitations. The Company shall not effect any
exercise of this Warrant, and a Holder shall not have the right to
exercise any portion of this Warrant, pursuant to Section 2 or
otherwise, to the extent that after giving effect to such issuance
after exercise as set forth on the applicable Notice of Exercise,
the Holder (together with the Holder’s Affiliates (as defined
below), and any other Persons (as defined below) acting as a group
together with the Holder or any of the Holder’s Affiliates),
would beneficially own in excess of the Beneficial Ownership
Limitation (as defined below). For purposes of the foregoing
sentence, the number of shares of Common Stock beneficially owned
by the Holder and its Affiliates shall include the number of shares
of Common Stock issuable upon exercise of this Warrant with respect
to which such determination is being made, but shall exclude the
number of shares of Common Stock which would be issuable upon (i)
exercise of the remaining, nonexercised portion of this Warrant
beneficially owned by the Holder or any of its Affiliates and (ii)
exercise or conversion of the unexercised or nonconverted portion
of any other securities of the Company (including, without
limitation, any other Common Stock Equivalents, as defined below)
subject to a limitation on conversion or exercise analogous to the
limitation contained herein beneficially owned by the Holder or any
of its Affiliates. Except as set forth in the preceding sentence,
for purposes of this Section 2(e), beneficial ownership shall be
calculated in accordance with Section 13(d) of the Exchange Act and
the rules and regulations promulgated thereunder, it being
acknowledged by the Holder that the Company is not representing to
the Holder that such calculation is in compliance with Section
13(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”),
and the Holder is solely responsible for any schedules required to
be filed in accordance therewith. To the extent that the limitation
contained in this Section 2(e) applies, the determination of
whether this Warrant is exercisable (in relation to other
securities owned by the Holder together with any Affiliates) and of
which portion of this Warrant is exercisable shall be in the sole
discretion of the Holder, and the submission of a Notice of
Exercise shall be deemed to be the Holder’s determination of
whether, and representation and certification to the Company that,
this Warrant is exercisable (in relation to other securities owned
by the Holder together with any Affiliates) and of which portion of
this Warrant is exercisable, in each case subject to the Beneficial
Ownership Limitation, and the Company shall have no obligation to
verify or confirm the accuracy of such determination. In addition,
a determination as to any group status as contemplated above shall
be determined in accordance with Section 13(d) of the Exchange Act
and the rules and regulations promulgated thereunder. For purposes
of this Section 2(e), in determining the number of outstanding
shares of Common Stock, a Holder may rely on the number of
outstanding shares of Common Stock as reflected in (A) the
Company’s most recent periodic or annual report filed with
the Securities and Exchange Commission (the “Commission”), as the case may be,
(B) a more recent public announcement by the Company or (C) a more
recent written notice by the Company or the Transfer Agent setting
forth the number of shares of Common Stock outstanding. Upon the
written or oral request of a Holder, the Company shall within two
(2) trading days confirm orally and in writing to the Holder the
number of shares of Common Stock then outstanding. In any case, the
number of outstanding shares of Common Stock shall be determined
after giving effect to the conversion or exercise of securities of
the Company, including this Warrant, by the Holder or its
Affiliates since the date as of which such number of outstanding
shares of Common Stock was reported. The “Beneficial Ownership
Limitation” shall be 4.99% of the number of
shares of the Common Stock outstanding immediately after giving
effect to the issuance of shares of Common Stock issuable upon
exercise of this Warrant. The Holder, upon not less than 61
days’ prior written notice to the Company, may increase or
decrease the Beneficial Ownership Limitation provisions of this
Section 2(e), provided that the Beneficial Ownership Limitation in
no event exceeds 9.99% of the number of shares of the Common Stock
outstanding immediately after giving effect to the issuance of
shares of Common Stock upon exercise of this Warrant held by the
Holder and the provisions of this Section 2(e) shall continue to
apply. Any such increase or decrease will not be effective until
the 61st day after such notice is delivered to the Company. The
provisions of this paragraph shall be construed and implemented in
a manner otherwise than in strict conformity with the terms of this
Section 2(e) to correct this paragraph (or any portion hereof)
which may be defective or inconsistent with the intended Beneficial
Ownership Limitation herein contained or to make changes or
supplements necessary or desirable to properly give effect to such
limitation. The limitations contained in this paragraph shall apply
to a successor holder of this Warrant.
-3-
“Affiliate” means any Person that,
directly or indirectly, through one or more intermediaries,
controls, or is controlled by, or is under common control with, a
Person.
“Common Stock Equivalents” means
any securities of the Company which would entitle the holder
thereof to acquire at any time Common Stock, including, without
limitation, any debt, preferred stock, right, option, warrant or
other instrument that is at any time convertible into or
exercisable or exchangeable for, or otherwise entitles the holder
thereof to receive, Common Stock.
“Person” means any natural person,
corporation, limited liability company, partnership, joint venture,
trust, unincorporated organization, or association.
Section 3. Certain
Adjustments.
(a) Stock
Dividends and Splits. If the Company, at any time while this
Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock
or any other equity or equity equivalent securities payable in
shares of Common Stock (which, for avoidance of doubt, shall not
include any shares of Common Stock issued by the Company upon
exercise of this Warrant), (ii) subdivides outstanding shares of
Common Stock into a larger number of shares, (iii) combines
(including by way of reverse stock split) outstanding shares of
Common Stock into a smaller number of shares, or (iv) issues by
reclassification of shares of the Common Stock any shares of
capital stock of the Company, then in each case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be
the number of shares of Common Stock (excluding treasury shares, if
any) outstanding immediately before such event and of which the
denominator shall be the number of shares of Common Stock
outstanding immediately after such event, and the number of shares
issuable upon exercise of this Warrant shall be proportionately
adjusted such that the aggregate Exercise Price of this Warrant
shall remain unchanged. Any adjustment made pursuant to this
Section 3(a) shall become effective immediately after the record
date for the determination of stockholders entitled to receive such
dividend or distribution and shall become effective immediately
after the effective date in the case of a subdivision, combination
or re-classification.
(b) Subsequent
Rights Offerings. In addition to any adjustments pursuant to
Section 3(a) above, if at any time during which this Warrant is
outstanding the Company grants, issues or sells any Common Stock
Equivalents or other rights to purchase stock, warrants, securities
or other property pro rata to the record holders of any class of
shares of Common Stock (the “Purchase Rights”), then the Holder
will be entitled to acquire, upon the terms applicable to such
Purchase Rights, the aggregate Purchase Rights which the Holder
could have acquired if the Holder had held the number of shares of
Common Stock acquirable upon complete exercise of this Warrant
(without regard to any limitations on exercise hereof, including
without limitation, the Beneficial Ownership Limitation)
immediately before the date on which a record is taken for the
grant, issuance or sale of such Purchase Rights, or, if no such
record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the grant, issue or sale
of such Purchase Rights (provided, however, to the extent that the
Holder’s right to participate in any such Purchase Right
would result in the Holder exceeding the Beneficial Ownership
Limitation, then the Holder shall not be entitled to participate in
such Purchase Right to such extent (or beneficial ownership of such
shares of Common Stock as a result of such Purchase Right to such
extent) and such Purchase Right to such extent shall be held in
abeyance for the Holder until such time, if ever, as its right
thereto would not result in the Holder exceeding the Beneficial
Ownership Limitation). The provisions of this Section 3(b) will not
apply to any grant, issuance or sale of Common Stock Equivalents or
other rights to purchase stock, warrants, securities or other
property of the Company which is not made pro rata to the record
holders of any class of shares of Common Stock.
-4-
(c) Fundamental
Transaction. If, at any time while this Warrant is
outstanding, (i) the Company, directly or indirectly, in one or
more related transactions effects any merger or consolidation of
the Company with or into another Person, (ii) the Company, directly
or indirectly, effects any sale, lease, license, assignment,
transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii)
any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed
pursuant to which holders of Common Stock are permitted to sell,
tender or exchange their shares for other securities, cash or
property and has been accepted by the holders of 50% or more of the
outstanding Common Stock, (iv) the Company, directly or indirectly,
in one or more related transactions effects any reclassification,
reorganization or recapitalization of the Common Stock or any
compulsory share exchange pursuant to which the Common Stock is
effectively converted into or exchanged for other securities, cash
or property, or (v) the Company, directly or indirectly, in one or
more related transactions consummates a stock or share purchase
agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme
of arrangement) with another Person or group of Persons whereby
such other Person or group acquires more than 50% of the
outstanding shares of Common Stock (not including any shares of
Common Stock held by the other Person or other Persons making or
party to, or associated or affiliated with the other Persons making
or party to, such stock or share purchase agreement or other
business combination) (each a “Fundamental Transaction”),
then, upon any subsequent exercise of this Warrant, the Holder
shall have the right to receive, for each Warrant Share that would
have been issuable upon such exercise immediately prior to the
occurrence of such Fundamental Transaction (without regard to any
limitation in Section 2(e) on the 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 any additional consideration (the “Alternate Consideration”)
receivable as a result of such Fundamental Transaction by a holder
of the number of shares of Common Stock for which this Warrant is
exercisable immediately prior to such Fundamental Transaction
(without regard to any limitation in Section 2(e) on the exercise
of this Warrant). For purposes of any such exercise, the
determination of the Exercise Price shall be appropriately adjusted
to apply to such Alternate Consideration based on the amount of
Alternate Consideration issuable in respect of one share of Common
Stock in such Fundamental Transaction, and the Company shall
apportion the Exercise Price among the Alternate Consideration in a
reasonable manner reflecting the relative value of any different
components of the Alternate Consideration. If holders of Common
Stock are given any choice as to the securities, cash or property
to be received in a Fundamental Transaction, then the Holder shall
be given the same choice as to the Alternate Consideration it
receives upon any exercise of this Warrant after such Fundamental
Transaction. The Company shall cause any successor entity in a
Fundamental Transaction in which the Company is not the survivor
(the “Successor
Entity”) to assume in writing all of the obligations
of the Company under this Warrant in accordance with the provisions
of this Section 3(c),. Upon the occurrence of any such Fundamental
Transaction, the Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such
Fundamental Transaction, the provisions of this Warrant and the
other Transaction Documents referring to the “Company”
shall refer instead to the Successor Entity), and may exercise
every right and power of the Company and shall assume all of the
obligations of the Company under this Warrant and the other
Transaction Documents with the same effect as if such Successor
Entity had been named as the Company herein.
(d) Calculations.
All calculations under this Section 3 shall be made to the nearest
cent or the nearest 1/100th of a share, as the case may be. For
purposes of this Section 3, the number of shares of Common Stock
deemed to be issued and outstanding as of a given date shall be the
sum of the number of shares of Common Stock (excluding treasury
shares, if any) issued and outstanding.
(e) Notice
to Holder.
(i) Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted
pursuant to any provision of this Section 3, the Company shall
promptly mail or e-mail to the Holder a notice setting forth the
Exercise Price after such adjustment and any resulting adjustment
to the number of Warrant Shares and setting forth a brief statement
of the facts requiring such adjustment; provided that no such
notice is required under this Section 3(e)(i) if the Company
publicly disseminates information via a press release or filing
with the SEC that sets forth in reasonable detail the facts that
would cause the Exercise Price to be adjusted.
(ii) Notice
to Allow Exercise by Holder. If (A) the Company shall
declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special
nonrecurring cash dividend on or a redemption of the Common Stock,
(C) the Company shall authorize the granting to all holders of the
Common Stock rights or warrants to subscribe for or purchase any
shares of capital stock of any class or of any rights, (D) the
approval of any stockholders of the Company shall be required in
connection with any reclassification of the Common Stock, any
consolidation or merger to which the Company is a party, any sale
or transfer of all or substantially all of the assets of the
Company, or any compulsory share exchange whereby the Common Stock
is converted into other securities, cash or property, or (E) the
Company shall authorize the voluntary or involuntary dissolution,
liquidation or winding up of the affairs of the Company, then, in
each case, the Company shall cause to be mailed to the Holder at
its last address as it shall appear upon the Warrant Register (as
defined in Section 4(c)) of the Company, at least 10 business days
before the applicable record or effective date hereinafter
specified, a notice stating (x) the date on which a record is to be
taken for the purpose of such dividend, distribution, redemption,
rights or warrants, or if a record is not to be taken, the date as
of which the holders of the Common Stock of record to be entitled
to such dividend, distributions, redemption, rights or warrants are
to be determined or (y) the date on which such reclassification,
consolidation, merger, sale, transfer or share exchange is expected
to become effective or close, and the date as of which it is
expected that holders of the Common Stock of record shall be
entitled to exchange their shares of the Common Stock for
securities, cash or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer or share
exchange; provided that the failure to mail such notice or any
defect therein or in the mailing thereof shall not affect the
validity of the corporate action required to be specified in such
notice. To the extent that any notice provided hereunder
constitutes, or contains, material, non-public information
regarding the Company, the Company shall simultaneously file such
notice with the Commission pursuant to a Current Report on Form
8-K. The Holder shall remain entitled to exercise this Warrant
during the period commencing on the date of such notice to the
effective date of the event triggering such notice except as may
otherwise be expressly set forth herein.
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Section 4. Transfer
of Warrant.
(a) Transferability.
This Warrant and all rights hereunder (including, without
limitation, any registration rights) are transferable, in whole or
in part, upon surrender of this Warrant at the principal office of
the Company or its designated agent, together with a written
assignment of this Warrant substantially in the form attached
hereto duly executed by the Holder or its agent or attorney and
funds sufficient to pay any transfer taxes payable upon the making
of such transfer. Upon such surrender and, if required, such
payment, the Company shall execute and deliver a new Warrant or
Warrants in the name of the assignee or assignees, as applicable,
and in the denomination or denominations specified in such
instrument of assignment, and shall issue to the assignor a new
Warrant evidencing the portion of this Warrant not so assigned, and
this original Warrant shall promptly be cancelled. The Warrant, if
properly assigned in accordance herewith, may be exercised by a new
holder for the purchase of Warrant Shares without having a new
Warrant issued. Neither this Warrant nor any Warrant Shares issued
upon exercise of this Warrant shall be sold, transferred, assigned,
pledged, or hypothecated, or be the subject of any hedging, short
sale, derivative, put, or call transaction that would result in the
effective economic disposition of the securities by any person for
a period of 180 days immediately following the date of
effectiveness of the Registration Statement or commencement of
sales of the offering pursuant to which this Warrant is being
issued, except the transfer of any security:
(i) by
operation of law or by reason of reorganization of the
Company;
(ii) to
any FINRA member firm participating in the offering and the
officers or partners thereof, if all securities so transferred
remain subject to the lock-up restriction in this Section 4(a) for
the remainder of the time period; or
(iii)
the exercise or conversion of any security, if all securities
received remain subject to the lock-up restriction in this Section
4(a) for the remainder of the time period.
(b) New
Warrants. This Warrant may be divided or combined with other
Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and
denominations in which new Warrants are to be issued, signed by the
Holder or its agent or attorney. Subject to compliance with Section
4(a), as to any transfer which may be involved in such division or
combination, the Company shall execute and deliver a new Warrant or
Warrants in exchange for the Warrant or Warrants to be divided or
combined in accordance with such notice. All Warrants issued on
transfers or exchanges shall be dated the initial issuance date of
this Warrant and shall be identical with this Warrant except as to
the number of Warrant Shares issuable pursuant
thereto.
(c) Warrant
Register. The Company shall register this Warrant, upon
records to be maintained by the Company for that purpose
(the “Warrant
Register”), in the name of the record Holder hereof
from time to time. The Company may deem and treat the registered
Holder of this Warrant as the absolute owner hereof for the purpose
of any exercise hereof or any distribution to the Holder, and for
all other purposes, absent actual notice to the
contrary.
Section 5. Miscellaneous.
(a) No
Rights as Stockholder until Exercise. This Warrant does not
entitle the Holder to any voting rights, dividend rights or other
rights as a stockholder of the Company before the exercise hereof
as set forth in Section 2(d)(i), except as expressly set forth
herein.
(b) Loss,
Theft, Destruction or Mutilation of Warrant. The Company
covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it (which, in the case of the
Warrant, shall not include the posting of any bond), and upon
surrender and cancellation of such Warrant or stock certificate, if
mutilated, the Company will make and deliver a new Warrant or stock
certificate of like tenor and dated as of such cancellation, in
lieu of such Warrant or stock certificate.
(c) Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the
taking of any action or the expiration of any right required or
granted herein shall not be a business day, then, such action may
be taken or such right may be exercised on the next succeeding
business day.
(d) Authorized
Shares. The Company covenants that, during the period the
Warrant is outstanding, it will reserve from its authorized and
unissued Common Stock a sufficient number of shares to provide for
the issuance of the Warrant Shares upon the exercise of any
purchase rights under this Warrant. The Company further covenants
that its issuance of this Warrant shall constitute full authority
to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary Warrant Shares upon
the exercise of the purchase rights under this Warrant. The Company
will take all such commercially reasonable action as may be
necessary to assure that such Warrant Shares may be issued as
provided herein without violation of any applicable law or
regulation, or of any requirements of the Trading Market upon which
the Common Stock may be listed. The Company covenants that all
Warrant Shares which may be issued upon the exercise of the
purchase rights represented by this Warrant will, upon exercise of
the purchase rights represented by this Warrant and payment for
such Warrant Shares in accordance herewith, be duly authorized,
validly issued, fully paid and nonassessable and free from all
taxes, liens and charges created by the Company in respect of the
issue thereof (other than taxes in respect of any transfer
occurring contemporaneously with such issue).
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Except
and to the extent as waived or consented to by the Holder, 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 Holder as set forth in this Warrant against
impairment. Without limiting the generality of the foregoing, the
Company will (i) not increase the par value of any Warrant Shares
above the amount payable therefor upon such exercise immediately
prior to such increase in par value, (ii) take all such action as
may be necessary or appropriate in order that the Company may
validly and legally issue fully paid and nonassessable Warrant
Shares upon the exercise of this Warrant, and (iii) use
commercially reasonable efforts to obtain all such authorizations,
exemptions or consents from any public regulatory body having
jurisdiction thereof, as may be, necessary to enable the Company to
perform its obligations under this Warrant.
Before
taking any action which would result in an adjustment in the number
of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or
exemptions therefor, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction
thereof.
(e) Jurisdiction.
All questions concerning the construction, validity, enforcement
and interpretation of this Warrant shall be determined in
accordance with the laws of the State of New York, without regard
to conflict of laws principles, and federal or state courts sitting
in the State of New York shall have exclusive jurisdiction over
matters arising out of this Warrant.
(f) Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the
exercise of this Warrant, if not registered, will have restrictions
upon resale imposed by state and federal securities
laws.
(g) Nonwaiver
and Expenses. No course of dealing or any delay or failure
to exercise any right hereunder on the part of Holder shall operate
as a waiver of such right or otherwise prejudice the Holder’s
rights, powers or remedies. Without limiting any other provision of
this Warrant or the Agreement, if the Company willfully and
knowingly fails to comply with any provision of this Warrant, which
results in any material damages to the Holder, the Company shall
pay to the Holder such amounts as shall be sufficient to cover any
and all costs and expenses including, but not limited to,
reasonable attorneys’ fees, including those of appellate
proceedings, incurred by the Holder in collecting any amounts due
pursuant hereto or in otherwise enforcing any of its rights, powers
or remedies hereunder.
(h) Notices.
Any notice, request or other document required or permitted to be
given or delivered to the Holder by the Company shall be delivered
to the Holder at its last address or e-mail address as it shall
appear upon the Warrant Register.
(i) Limitation
of Liability. No provision hereof, in the absence of any
affirmative action by the Holder to exercise this Warrant to
purchase Warrant Shares, and no enumeration herein of the rights or
privileges of the Holder, shall give rise to any liability of the
Holder for the purchase price of any Common Stock or as a
stockholder of the Company, whether such liability is asserted by
the Company or by creditors of the Company.
(j) Remedies.
The Holder, in addition to being entitled to exercise all rights
granted by law, including recovery of damages, will be entitled to
specific performance of its rights under this Warrant. The Company
agrees that monetary damages alone would not be adequate
compensation for any loss incurred by reason of a breach by it of
the provisions of this Warrant and hereby agrees to waive and not
to assert the defense in any action for specific performance that a
remedy at law would be adequate.
(k) Successors
and Assigns. Subject to applicable securities laws, this
Warrant and the rights and obligations evidenced hereby shall inure
to the benefit of and be binding upon the successors and permitted
assigns of the Company and the successors and permitted assigns of
Holder. The provisions of this Warrant are intended to be for the
benefit of any Holder from time to time of this Warrant and shall
be enforceable by the Holder or holder of Warrant
Shares.
(l) Amendment.
This Warrant may be modified or amended or the provisions hereof
waived with the written consent of the Company and the
Holder.
(m) Severability.
Wherever possible, each provision of this Warrant shall be
interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Warrant shall be
prohibited by or invalid under applicable law, such provision shall
be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provisions or the
remaining provisions of this Warrant.
(n) Headings.
The headings used in this Warrant are for the convenience of
reference only and shall not, for any purpose, be deemed a part of
this Warrant.
[Signature Page Follows]
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IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed
by its officer thereunto duly authorized as of the date first above
indicated.
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Name:
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Title:
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[Signature Page to Selling Agent’s Warrant]
-8-
NOTICE OF EXERCISE
(1) The
undersigned hereby elects to purchase ________ Warrant Shares of
the Company pursuant to the terms of the attached Warrant, dated
_______, 2018, and tenders herewith payment of the exercise price
in full, together with all applicable transfer taxes, if
any.
(2)
Payment shall take the form of (check applicable box):
☐
in lawful money of the United States by wire transfer or
cashier’s check drawn on a United States bank;
or
☐
if permitted by the terms of the Warrant, the cancellation of such
number of Warrant Shares as is necessary, in accordance with the
formula set forth in subsection 2(c), to exercise this Warrant
pursuant to the cashless exercise procedure set forth in subsection
2(c).
(3)
Please issue said Warrant Shares in the name of the undersigned or
in such other name as is specified below:
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The
Warrant Shares shall be delivered to the following DWAC Account
Number:
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[SIGNATURE
OF HOLDER]
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Name of
Investing Entity:
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Signature
of Authorized Signatory of Investing Entity:
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Name of
Authorized Signatory:
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Title
of Authorized Signatory:
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Date:
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ASSIGNMENT FORM
(To
assign the foregoing Warrant, execute
this
form and supply required information.
Do not
use this form to exercise the Warrant.)
FOR
VALUE RECEIVED, ____ all of or _______ shares of the foregoing
Warrant and all rights evidenced thereby are hereby assigned
to
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whose
address is:
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Date:
______________, _______
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Holder’s
Signature:
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Holder’s
Address:
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Signature
Guaranteed:
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NOTE: The signature to this Assignment Form must correspond
with the name as it appears on the face of the Warrant, without
alteration or enlargement or any change whatsoever, and must be
guaranteed by a bank or trust company. Officers of corporations and
those acting in a fiduciary or other representative capacity should
file proper evidence of authority to assign the foregoing
Warrant.
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