EXHIBIT 4.1
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ corp.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
FORM OF UNDERWRITERS' WARRANT
WARRANT NO. __
Date of Issuance: As of June 10, 1999 Right to Purchase _________ Shares
FOR VALUE RECEIVED, ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ corp., a Florida corporation
(the "Company"), promises to issue in the name of, and sell and deliver to,
____________ (the "Holder") a certificate or certificates for an aggregate of
_______ shares (the "Warrant Shares") of the Company's common stock, $.01 par
value per share (the "Common Stock"), upon payment by the Holder of the exercise
price of $11.55 per share for the Warrant Shares (the "Exercise Price") in
lawful funds of the United States of America, with the Exercise Price being
subject to adjustment in the circumstances set forth hereinbelow. This Warrant
expires in its entirety at 5:00 p.m. Eastern Time on June 9, 2004 (the
"Expiration Date"). This Underwriters' Warrants is issued as of June 10, 1999
pursuant to the Underwriting Agreement dated as of June 10, 1999 between the
Company and ▇▇▇▇▇▇-▇▇▇▇ Securities, Inc., and the several underwriters named in
the Underwriting Agreement (the "Underwriters"). This Warrant may not be sold,
transferred, assigned or hypothecated until June 10, 2000, except that it may be
transferred, in whole or in part, to one or more officers or partners of the
Holder (or the officers or partners of such partner); any other Underwriter or
member of the selling group which participated in the Company's public offering
which commenced on June 11, 1999; a successor to the Holder, or other officers
or partners of such Holder; or by operation of law. The terms and conditions of
the Underwriters' Warrants shall be identical in all material respects except
that the number of Warrant Shares to which the Holder is entitled to purchase
may differ.
SECTION 1 - CERTAIN DEFINITIONS:
As used in this Warrant, the following terms have the meanings set
forth below:
"COMMON STOCK DEEMED OUTSTANDING" means, at any given time, the number
of shares of Common Stock actually outstanding at such time, plus the number of
shares of Common Stock deemed to be outstanding pursuant to Section 4 of this
Warrant.
"DATE OF ISSUANCE" is the date set forth on the front page of this
Warrant, and the terms "date hereof," "date of this Warrant," and similar
expressions shall be deemed to refer to the Date of Issuance, as specified in
Section 10 of this Warrant.
"EFFECTIVE DATE" means the date the Company's Registration Statement
(as defined below) is declared effective by the U.S. Securities and Exchange
Commission (the "Commission").
"EXERCISE PERIOD" means the period of time commencing at 12:01 A.M.,
Eastern Time, on the first anniversary of the Effective Date and ending at 5:00
p.m., Eastern Time, on the fifth anniversary of the Effective Date.
"MARKET PRICE" means, as to any security, the average of the closing
prices of Such security's sales on the principal domestic securities exchange on
which such security may at the time be listed, or, if there have been no sales
on any such exchange oil any day, the average of the highest bid and lowest
asked prices on all such exchanges at the end of such day, or, if on any day
such security is not so listed, the average of the representative bid and asked
prices listed on Nasdaq as of the Close of trading in New York City on such day,
or, if on any day such security is not listed on Nasdaq, the average of the high
and low bid and asked prices on such day in the domestic over-the-counter market
as reported by the National Quotation Bureau, Incorporated, or any similar
successor organization, in each such case averaged over a period of 20
consecutive business days consisting of the business day immediately preceding
the day as of which "Market Price" is being determined and the 19 consecutive
business days prior to such day; PROVIDED that if such security is listed on any
domestic securities exchange or listed on Nasdaq, the term "business day" or
"business days" as used in this sentence means a day or days, as applicable, on
which such exchange or Nasdaq is open for trading or quotation, as the case may
be. If at any time such security is not listed on any domestic securities
exchange or quoted an Nasdaq or the domestic over-the-counter market, the
"Market Price" will be the fair value thereof determined jointly by the Company
and the Holders of Warrants representing at least 50% of the Common Stock
purchasable upon the exercise of all the Warrants then outstanding; PROVIDED
that if such parties are unable to reach agreement, such fair value will be
determined by an appraiser jointly selected by the Company and the Holders of
Warrants representing at least 25% of the Common Stock purchasable upon the
exercise of all the Warrants then outstanding.
"NASDAQ" means the Nasdaq National Market(R), the Nasdaq SmallCap
Market or such other similar quotation system as may in the future be used
generally by members of The Nasdaq Stock Market, Inc. for transactions in
securities.
" PERSON " means an individual, a partnership, a corporation, a limited
liability company, a trust, a joint venture, an unincorporated organization, or
a government or any department or agency thereof
"REGISTRATION STATEMENT" means the Company's Registration Statement on
Form SB-2, File No. 333-75119.
"WARRANTS" mean this Warrant and all other Warrants issued In exchange
or substitution for this Warrant or any such other Warrants issued pursuant to
the terms hereof or thereof, as the case may be.
SECTION 2 - EXERCISE OF WARRANT:
2.1 EXERCISE PERIOD. The Holder may exercise this Warrant, in whole or in part
(but not as to a fractional share), at any time and from time to time, during
the Exercise Period.
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2.2 EXERCISE PROCEDURE.
a. This Warrant will be deemed to have been exercised at such time as
the Company has received all of the following items (the "Exercise Date"):
(i) a completed Exercise Agreement, in the form set forth
as Exhibit I hereto, executed by the Person exercising
all or part of the purchase rights represented by this
Warrant (the "Purchaser");
(ii) this Warrant (subject to delivery by the Company of a
new Warrant with respect to any unexercised portion, as
provided in Subsection 2.2(b)),
(iii) if this Warrant is not registered in the name of the
Purchaser, an Assignment or Assignments in the form set
forth as Exhibit II hereto, evidencing the assignment
of this Warrant to the Purchaser; and
(iv) a cashier's or official bank check or other immediately
available funds payable to the Company in an amount
equal to the sum of the product of the Exercise Price
multiplied by the number of Warrant Shares being
purchased upon such exercise. Notwithstanding anything
contained herein to the contrary, the Exercise Price
for the Warrant may be satisfied by the delivery of an
unexercised portion of this Warrant to the Company or
the Transfer Agent for cancellation having a market
value, as determined by the spread as of the date of
surrender equal to the difference between the then
Exercise Price and the market price of the shares of
Common Stock underlying this Warrant, equal to the
aggregate Exercise Price of the portion of this Warrant
desired to be then exercised.
b. Certificates for Warrant Shares purchased upon exercise of this
Warrant will be delivered by the Company to the Purchaser within five calendar
days after the Exercise Date. Unless this Warrant has expired or all of the
purchase rights represented hereby have been exercised, the Company will prepare
a new Warrant representing the rights formerly represented by this Warrant that
have not expired or been exercised. The Company will, within such five-day
period, deliver such new Warrant to the Person designated for delivery in the
Exercise Agreement.
c. The Warrant Shares issuable upon the exercise of this Warrant will
be deemed to have been transferred to the Purchaser on the Exercise Date, and
the Purchaser will be deemed for all purposes to have become the record holder
of such Common Stock on the Exercise Date.
d. The issuance of certificates for Warrant Shares upon exercise of
this Warrant will be made without charge to the Holder or the Purchaser for any
issuance tax in respect thereof or ally other cost incurred by the Company in
connection with such exercise and the related transfer; provided, however, that
the Company shall not be required to pay any tax that may be payable in respect
of any transfer involved in the issuance and delivery of any certificate or
instrument in a name other than that of the Holder of this Warrant, and the
Company shall not be required to issue or deliver any such certificate or
instrument unless and until the Person or
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Persons requesting the issue thereof shall have paid to the Company the amount
of such tax or shall have established to the satisfaction of the Company that
such tax has been paid.
e. The Company will not close its books for the transfer of this
Warrant or of any of the Warrant Shares in any manner that interferes with the
timely exercise of this Warrant. The Company will from time to time take all
such action as may be necessary to assure that the par value per share of the
unissued Common Stock acquirable upon exercise of this Warrant is at all times
equal to or less than the Warrant Share Exercise Price then in effect.
2.3 EXERCISE AGREEMENT. The Exercise Agreement will be substantially in the form
set forth as Exhibit I hereto, except that if the Warrant Shares are not to be
issued in the name of the Holder of this Warrant, the Exercise Agreement will
also state the name of the Person to whom the certificates or instrument for the
Warrant Shares are to be issued, and if the number of Warrant Shares purchasable
does not include all of such securities purchasable hereunder, it will also
state the name of the Person to whom a new Warrant for the unexercised portion
of the rights hereunder is to be delivered.
2.4 FRACTIONAL SHARES. If a fractional share of Common Stock would, but for the
provisions of Subsection 2.1, be issuable upon exercise of the rights
represented by this Warrant, the Company will, within 20 days after the Exercise
Date, deliver to the Purchaser a check payable to the Purchaser, in lieu of such
fractional share, in an amount equal to the Market Price of such fractional
share as of the close of business on the Exercise Date.
SECTION 3 - EXERCISE PRICE:
3.1 GENERAL. The Holder of this Warrant shall be entitled to purchase such
numbers of Warrant Shares at the Exercise Price.
3.2 SUBDIVISION OR COMBINATION OF COMMON STOCK AND STOCK DIVIDENDS. If the
Company shall at any time after the date hereof (a) issue any shares of Common
Stock or Convertible Securities, or any rights to purchase Common Stock or
Convertible Securities, as a dividend upon Common Stock, (b) issue any shares of
Common Stock, in subdivision of outstanding shares of Commercial Stock by
reclassification or otherwise, or (c) combine outstanding shares of Common
Stock, by reclassification or otherwise, then the Exercise Price that would
apply if purchase rights hereunder were being exercised immediately prior to
such action by the Company shall be adjusted by multiplying it by a fraction,
the numerator of which shall be the number of shares of Common Stock Deemed
Outstanding immediately after such dividend, subdivision, or combination and the
denominator of which shall be the number of shares of Common Stock Deemed
Outstanding immediately after such dividend, subdivision, or combination.
3.3 CERTAIN DIVIDENDS OR DISTRIBUTIONS. If the Company shall declare a dividend
or distribution upon the Common Stock payable otherwise than out of earnings or
earned surplus and otherwise than in Common Stock, Rights or Convertible
Securities, the Exercise Price that would apply if purchase rights hereunder
were being exercised immediately prior to the declaration of such dividend or
distribution shall be reduced by an amount equal, in the case of a dividend or
distribution in cash, to the amount thereof payable per share of the Common
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Stock or, in the case of any other dividend or distribution, to the fair value
of such dividend or distribution per share of the Common Stock as determined in
good faith by the Board of Directors of the Company. For purposes of the
foregoing, a dividend or distribution other than in cash shall be considered
payable out of earnings or earned surplus only to the extent that such earnings
or earned surplus are charged an amount equal to the fair value of such dividend
or distribution as determined in good faith by the Board of Directors of the
Company. Such reductions shall take effect as of the date on which a record is
taken for the purpose of such dividend or distribution or, if a record is not
taken, the date as of which the holders of Common Stock of record entitled to
such dividend or distribution are to be determined.
3.4 NO DE MINIMIS ADJUSTMENTS. No adjustment of the Exercise Price shall be made
if the amount or such adjustment would be less than one cent per share, but in
such case any adjustment that otherwise would be required to be made shall be
carried forward and shall be made at the time and together with the next
subsequent adjustment that, together with any adjustment or adjustments so
carried forward, shall amount to not less than one cent Per share.
SECTION 4 - ADJUSTMENT OF NUMBER OF SHARES ISSUABLE UPON EXERCISE:
Upon each adjustment of the Exercise Price pursuant to Section 3, the
Holder of this Warrant shall thereafter (until another such adjustment) be
entitled to purchase (i) at the adjusted Exercise Price in effect on the date
purchase rights for Warrant Shares under this Warrant are exercised, the number
of Warrant Shares, calculated to the nearest whole number, determined by (a)
multiplying the number of Warrant Shares purchasable hereunder immediately prior
to the adjustment of the Exercise Price by the Exercise Price in effect
immediately prior to such adjustment, and (b) dividing the product so obtained
by the adjusted Exercise Price in effect on the date of such exercise. The
provisions of Subsection 2.4 shall apply, however, so that no fractional Warrant
Share shall be issued upon exercise of this Warrant.
SECTION 5 - EFFECT OF REORGANIZATION, RECLASSIFICATION, CONSOLIDATION, MERGER OR
SALE:
If any time while this Warrant is outstanding there shall be any
reorganization or reclassification of the capital stock of the Company (other
than a subdivision or combination of shares provided for in Subsection 3.3
hereto, any consolidation or merger of the Company with another corporation
(other than a consolidation or merger in which the Company is the surviving
entity and which does not result in any change in the Common Stock), or any sale
or other disposition by the Company of all or substantially all of its assets to
any other corporation, then the Holder of this Warrant shall thereafter upon
exercise of this Warrant be entitled to receive the number of Warrant Shares or
other securities or property of the Company, or of the successor corporation
resulting from such consolidation or merger, as the case may be, to which the
Holders of the Warrant Shares (and any other securities and property) of the
Company, deliverable upon the exercise of this Warrant, would have been entitled
upon such reorganization, reclassification of capital stock, consolidation,
merger, sale, or other disposition if this Warrant had been exercised
immediately prior to such reorganization, reclassification of capital stock,
consolidation, merger, sale, or other disposition. In any such case, appropriate
adjustment (as determined in good faith by the Board of Directors of the
Company) shall be made in the application of the provisions set forth in this
Warrant with respect to the rights and interests thereafter of the Holder of
this Warrant to the end that the provisions set forth in this Warrant (including
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those relating to adjustments of the Exercise Price and the number of Warrant
Shares issuable upon the exercise of this Warrant) shall thereafter be
applicable, as near as reasonably may be, in relation to any shares or other
property thereafter deliverable upon the exercise hereof as if this Warrant had
been exercised immediately prior to such reorganization, reclassification of
capital stock, consolidation, merger, sale, or other disposition and the Holder
hereof had carried out the terms of the exchange as provided for by such
reorganization, reclassification of capital stock, consolidation, or merger. The
Company shall not effect any such reorganization, consolidation, or merger
unless, upon or prior to the consummation thereof, the successor corporation
shall assume by written instrument the obligation to deliver to the Holder
hereof such shares of stock or other securities, cash, or property as such
Holder shall be entitled to purchase in accordance with the foregoing
provisions. Notwithstanding any other provisions of this Warrant, in the event
of sale or other disposition of all or substantially all of the assets of the
Company as a part of a plan for liquidation of the Company, all rights to
exercise the Warrant shall terminate upon the earlier of the expiration of the
Exercise Period and 60 days after the Company gives written notice to the Holder
of this Warrant that such sale or other disposition has been consummated.
SECTION 6 - NOTICE OF ADJUSTMENT:
Immediately upon any adjustment of the Exercise Price or increase or
decrease in the number of Warrant Shares, the Company will send written notice
thereof to all Holders, stating the adjusted Exercise Price, mid the increased
or decreased number of Warrant Shares and setting forth in reasonable detail the
method of calculation for such adjustment and increase or decrease. When
appropriate, such notice may be given in advance and included as part of any
notice required to be given pursuant to Section 7 below, Notwithstanding
anything herein to the contrary, if any adjustment under this Warrant of the
Exercise Price or the number of shares of Common Stock issuable upon exercise of
this Warrant, shall be determined by NASD Regulation, Inc. (the "NASD") to
violate the Rules of Fair Practice of the NASD, and such determination shall not
be subject to further appeal or review, the violative provisions shall be deemed
to be amended to the minimum extent necessary to cause each such provision to
comply with the applicable violated section of The NASD Rules of Fair Practice.
SECTION 7 - PRIOR NOTICE OF CERTAIN EVENTS:
If at any time:
a. the Company shall pay any dividend payable in stock upon its Common
Stock or make any distribution (other than cash dividends) to the holders of its
Common Stock;
b. the Company shall offer for subscription pro rata to the holders of
its Common Stock any additional shares of stock of any class or any other
rights,
c. there shall be any reorganization or reclassification of the capital
stock of the Company, any consolidation or merger of the Company with another
corporation, or a sale or disposition of all or substantially all its assets; or
d. there shall be a voluntary or involuntary dissolution, liquidation,
or winding up of the Company,
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then, In each such case, the Company shall give prior written notice, by hand
delivery or by certified mail, postage prepaid, addressed to the Holder of this
Warrant at the address of such holder as own on the books of the Company, of the
date on which (i) the books of the Company shall close or a record shall be
taken for such stock dividend, distribution, or subscription rights or (ii) such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation, or winding up shall take place, as the case may be. A copy of each
such notice shall be sent simultaneously to each transfer agent of the Company's
Common Stock. Such notice shall also specify the date as of which the holders of
Common Stock of record shall participate in said dividend, distribution, or
rights or shall be entitled to exchange their Common Stock for securities or
other property deliverable upon such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation, or winding up, as the
case may be. Such written notice shall be given at least 30 days prior to the
record date or the effective date, whichever is earlier, of the subject action
or other event.
If any other event (not listed above) would require adjustment to the
Exercise Price, then the Company shall give prior written notice thereof (in
substance as set forth above) to the Holders, at their addresses and in the
manner provided in Subsection 13.3. Notwithstanding the foregoing, the Company
shall not be required to give prior written notice where it is not reasonably
possible.
SECTION 8 - RESERVATION OF COMMON STOCK:
The Company will at all times reserve and keep available such number of
shares of Common Stock as will be sufficient to permit the exercise in full of
all outstanding Warrants. Upon exercise of this Warrant, the Holder will acquire
fully paid and non-assessable ownership rights of the Common Stock, free and
clear of any liens, claims or encumbrances. As long as the Warrants shall be
outstanding, the Company shall use its best efforts to cause all shares of
Common Stock issuable upon the exercise of the Warrants to be listed (subject to
official notice of issuance) on all Securities exchanges on which the Common
Stock issued to the public in connection herewith may then be listed and/or
quoted on Nasdaq or Nasdaq SmallCap Market.
SECTION 9 - NO SHAREHOLDER RIGHTS OR OBLIGATION:
This Warrant will not entitle the holder hereof to any voting rights or
other rights as a shareholder of the Company. Until the shares of Common Stock
issuable upon exercise of this Warrant are recorded as issued on the books and
records of the Company's transfer agent, the Holder shall not be entitled to
any voting rights or other rights as a shareholder; provided, however, the
Company uses its best efforts to ensure that, upon receipt of an Exercise
Agreement, the appropriate documentation necessary to effectuate the exercise of
the Warrant and issuance of the Common Stock is accomplished as expeditiously as
possible. No provision of this Warrant, in the absence of affirmative action by
the Holder to purchase Common Stock, and no enumeration in this Warrant of the
rights or privileges of the Holder, will give rise to any obligation of such
Holder for the Exercise Price of the Warrant Shares acquirable by exercise
hereof or as a shareholder of the Company.
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SECTION 10 - EXCHANGEABLE FOR DIFFERENT DENOMINATIONS:
This Warrant is exchangeable, upon the surrender hereof by the Holder
at the principal office of the Company, for new Warrants of like tenor
representing in the aggregate the purchase rights hereunder, and each of such
new Warrants, as set forth on the front page hereof, will represent such portion
of such rights as is designated by the Holder at the time of such surrender. The
date the Company initially issued this Warrant, which is set forth on the front
page hereof, will be deemed to be the "Date of Issuance" of this Warrant and any
purchase warrant exchanged or substituted herefor, regardless of the number of
times (and dates on which) new certificates representing the unexpired and
unexercised rights formerly represented by this Warrant are issued.
SECTION 11 - TRANSFERABILITY:
Subject to the transfer conditions referred to in Section 2 or in the
remaining provisions or this Section 11, this Warrant and all rights hereunder
are transferable, in whole or in part, without charge to the Holder, upon
surrender of this Warrant with a properly executed Assignment (in the form of
Exhibit II hereto) at the principal office of the Company. This Warrant and the
Warrant Shares may not be offered, sold, or transferred except in compliance
with the Securities Act of 1933, as amended (the "Act"), and any applicable
state securities laws; and then only against receipt of an agreement of the
Person to whom such offer or sale is made to comply with the provisions of this
Section 11 with respect to any resale or other disposition of such securities;
PROVIDED that no such agreement shall be required from any Person purchasing
this Warrant or any Warrant Shares pursuant to a registration statement
effective under the Act. The Holder of this Warrant agrees that prior to the
disposition of any security purchased on the exercise hereof under circumstances
that might require registration of such security under the Act, or any similar
statute then in effect, the Holder shall give written notice to the Company,
expressing his intention as to such disposition, Promptly upon receiving such
notice, the Company shall present a copy thereof to its, securities counsel. If,
in the opinion of such counsel, the proposed disposition does not require
registration of such security under the Act, or any similar statute then in
effect, the Company shall, as promptly as practicable, notify the Holder of such
opinion, whereupon the Holder shall be entitled to dispose of such security in
accordance with the terms of the notice delivered by the Holder to the Company.
The above agreement by the Holder of this Warrant shall not be deemed to limit
or restrict in any respect the exercise of rights set forth in Section 12
hereof.
SECTION 12 - REGISTRATION RIGHTS:
12.1 DEMAND REGISTRATION RIGHT. At any time during the Exercise Period and for a
maximum period of five years following the date of the Prospectus, Holders of
Warrants whose holdings thereof comprise a majority of the Warrant Shares
issuable upon exercise of said Warrants (provided the number of Warrant Shares
is not less than 65,000), shall have the right to require the Company (a) to
prepare and file with the Commission up to one new registration statement under
the Act (or, in lieu thereof, a post-effective amendment or amendments to the
Registration Statement, if then permitted under the Act), covering all or any
portion of the Warrants and the Warrant Shares and to use its best efforts to
obtain promptly and maintain the effectiveness thereof for at least nine
consecutive months and (b) to register or qualify the Subject Warrants and
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Warrant Shares for sale in up to ten states identified by such holders. The
Company covenants and agrees to give written notice of any registration request
under this Section 12.1 by any Holder or Holders to all other registered Holders
of the Warrants and the Warrant Shares within ten days from the date of the
receipt of any such registration request. Notwithstanding anything to the
contrary contained herein, if the Company shall not have filed a registration
statement for the Warrant Shares within the time period specified in Section
12.3(a) hereof pursuant to the written notice specified in Section 12, 1 of a
Majority or the Holders of the Warrants and/or Warrant Shares, the Company shall
have the option, upon the written notice of election of a Majority of the
Holders of the Warrants and/or Warrant Shares, to repurchase (i) any and all
Warrant Shares at the higher of the Market Price per Share of Common Stock on
(x) the date of notice sent pursuant to Section 12.1 or (y) the expiration of
the period specified in Section 12.3(a) and (ii) any and all Warrants at such
Market Price less the Exercise Price of such Warrant. Such repurchase shall be
in immediately available funds and shall close within two days after the later
of (i) the expiration of the period specified in Section 12.3(a) or (ii) the
delivery of the written notice of election specified in this Section 12.1.
Notwithstanding the foregoing, if the Company shall inform the Holders
requesting the filing of a registration statement pursuant to this Section 12.1
that, in the good faith judgment of the Board of Directors of the Company, it
would be seriously detrimental to the Company and its shareholders for such
registration statement to be filed and it is therefore essential to defer the
filing of such registration statement, then the Company shall have the right to
defer such filing for a period of not more than 120 days after receipt of the
request of the initiating Holders; PROVIDED, HOWEVER, that the Company may not
utilize this right more than once in any twelve (12) month period.
12.2 PIGGY BACK REGISTRATION RIGHTS. In addition, if at any time commencing
after the date hereof and expiring seven years after the date hereof, the
Company shall prepare and file one or more registration statements under the Act
(other than pursuant to Form S-8, S-4 or a comparable registration statement),
the Company will include in any such registration statement such information as
is required, and such number of shares of Common Stock held by, or shares of
Common Stock underlying outstanding Warrants held by, the Holder hereof or their
respective designees or transferees as may be requested by them, to permit a
public offering of the Warrant Shares so requested. In the event of such a
proposed registration, the Company shall furnish the then Holders with not less
than 30 days written notice prior to the proposed date of filing of such
registration statement. The Company shall use its best efforts to ensure that
such registration statement is declared effective and remains effective until
such time as all of the shares have been registered or may be sold without
registration under the Act or applicable state securities laws and regulations,
and without limitation as to volume, pursuant to Rule 144 of the Act. The
Holders shall be entitled to exercise the rights provided for in this Section
12.2 by giving written notice to the Company, within 20 days of receipt of the
Company's notice of its intention to file a registration statement.
Notwithstanding the provisions of this Section 12.2, the Company shall have the
right at any time after it shall have given written notice pursuant to this
Section 12.2 (irrespective of whether a written request for inclusion of any
such securities shall have been made) to elect not to file any such Proposed
registration statement, or to withdraw the same after the filing but prior to
the effective date thereof.
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Notwithstanding the foregoing, if, in the written opinion of the
Company's managing underwriter, if any, for such offering, the inclusion of all
or a portion of the securities requested to be registered, when added to the
securities being registered by the Company, will exceed the maximum amount of
the Company's securities which can be marketed (i) at a price reasonably related
to their then current market value, or (ii) without otherwise materially
adversely affecting the entire offering, then the Company may, on a pro-rata
basis, exclude from such offering all or a portion of the securities which it
has been requested to register.
The registration rights provided in Sections 12.1 and 12.2 shall be
inapplicable and of no force or benefit (i) when the Warrant Shares have been
effectively registered under the Act and disposed of pursuant thereto; (ii)
registration under the Act is no longer required for subsequent public
distribution of such security pursuant to Rule 144 under the Act (or any
successor provision) or (iii) the Warrant or Warrant Shares cease to be
outstanding.
12.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In connection with
any registration under Section 12.1 or 12.2 hereof, the Company covenants and
agrees as follows:
a. The Company shall use its best efforts to file a registration
statement within 60 days of receipt of any demand therefor, shall use its best
efforts to have any registration statement declared effective at the earliest
possible time, and shall furnish each Holder desiring to sell the Warrants or
Warrant Shares such number of prospectuses as shall reasonably be requested.
b. The Company shall pay all costs (excluding fees and expenses of
Holder(s)' counsel and any underwriting or selling commissions), fees and
expenses in connection with all registration statements filed pursuant to
Sections 12.1 and 12.2 hereof including, without limitation, the Company's legal
and accounting fees, printing expenses, blue sky fees and expenses. If the
Company shall fail to comply with the provisions of Section 12.1, the Company
shall, in addition to any other equitable or other relief available to the
Holder(s), be liable for any or all incidental or special damages sustained by
the Holder(s) requesting registration of their Warrants or Warrant Shares,
excluding consequential damages.
c. The Company will take all necessary action which may be required in
qualifying or registering the Warrants or Warrant Shares included in a
registration statement for offering and sale under the securities or blue sky
laws of such states as reasonably are requested by the Holder(s), provided that
the Company shall not be obligated to execute or file any general consent to
service of process or to qualify as a foreign corporation to do business under
the laws of any such jurisdiction.
d. The Company shall indemnify the Holder(s) of the Warrants or Warrant
Shares to be sold pursuant to any registration statement and each person, if
any, who controls such Holders within the meaning of Section 15 of the Act or
Section 20(a) of the Securities Exchange Act of 1944, as amended ("Exchange
Act"), against all loss, claim, damage, expense or liability (including all
expenses reasonably incurred in investigating, preparing or defending against
any claim whatsoever) to which any of them may become subject under the Act, the
Exchange Act or otherwise, arising from such registration statement but only to
the same extent and with the same affect as the provisions pursuant to which the
Company has agreed to indemnify the
10
Underwriters contained in Section 8 of the Underwriting Agreement. The Company
further agree(s) that upon demand by an indemnified person, at any time or from
time to time, it will promptly reimburse such indemnified person for any loss,
claim, damage, liability, cost or expense actually and reasonably paid by the
indemnified person as to which the Company has indemnified such person pursuant
hereto. Notwithstanding the foregoing provisions of this Section 12.3 any such
payment or reimbursement by the Company of fees, expenses or disbursements
incurred by an indemnified person in any proceeding in which a final judgment by
a court of competent jurisdiction (after all appeals or the expiration of time
to appeal) is entered against the Company or such indemnified person as a direct
result of the Holder(s) or such person's gross negligence or willful misfeasance
will be promptly repaid to the Company.
e. The Holder(s) of the Warrants and Warrant Shares to be sold pursuant
to a registration statement, and their successors and assigns, shall severally,
and not jointly, indemnify the Company, its officers and directors and each
person, if any, who controls the Company within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act, against all loss, claim, damage,
expense or liability (including all expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
they may become subject under the Act, the Exchange Act or otherwise, arising
from information furnished by or on behalf of such Holders, or their successors
or assigns, for specific inclusion in such registration statement to the same
extent and with the same effect as the provisions contained in Section 8 of the
Underwriting Agreement pursuant to which the Underwriters have agreed to
indemnify the Company. The Holder(s) further agree(s) that upon demand by an
indemnified person, at any time or from time to time, they will promptly
reimburse such indemnified person for any loss, claim, damage, liability, cost
or expense actually and reasonably paid by the indemnified person as to which
the Holder(s) have indemnified such person pursuant hereto. Notwithstanding the
foregoing provisions of this Section 12.3 any such payment or reimbursement by
the Holder(s) of fees, expenses or disbursements incurred by an indemnified
person in any proceeding in which a final judgment by a court of competent
jurisdiction (after all appeals or the expiration of time to appeal) is entered
against the Company or such indemnified person as a direct result of the Company
or such person's gross negligence or willful misfeasance will he promptly repaid
to the Holder(s).
f. Nothing contained in this Agreement shall be construed as requiring
the Holder(s) to exercise their Warrants prior to the initial filing of any
registration statement or the effectiveness thereof.
g. The Company shall not permit the inclusion of any securities other
than the Warrant Shares to be included in any registration statement filed
pursuant to Section 12.1 hereof, without the prior written consent of the
Holders of the Warrants and Warrant Shares representing a Majority of such
securities (assuming the exercise of all of the Warrants).
h. The Company shall furnish to each Holder participating in the
offering and to each underwriter, if any, a signed counterpart, addressed to
such Holder or underwriter, of (i) an opinion of counsel to the Company, dated
the effective date of such registration statement (and, if such registration
includes an underwritten public offering, an opinion dated the date of the
closing under the underwriting agreement), and (ii) a "cold comfort" letter
dated the effective date of such registration statement (and, if such
registration includes an underwritten public
11
offering, a letter dated the date of the closing under the underwriting
agreement) signed by the independent public accountants who have issued a report
on the Company's financial statements included in such registration statement,
in each case covering substantially the same matters with respect to such
registration statement (and the prospectus included therein) and, in the case of
such accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to underwriters in underwritten public
offerings of securities.
i. The Company shall deliver promptly to each Holder participating in
the offering requesting the correspondence and memoranda described below and to
the managing underwriter, if any, copies of all correspondence between the
Commission and the Company, its counsel or auditors and all memoranda relating
to discussions with the Commission or its staff with respect to the registration
statement and permit each Holder and underwriter to do such investigation, upon
reasonable advance notice, with respect to information contained in or omitted
from the registration statement as it deems reasonably necessary to comply with
applicable securities law or rules of the NASD. Such investigation shall include
access to books, records and properties and opportunities to discuss the
business of the Company with its officers and independent auditors, all to such
reasonable extent and at such reasonable times and as often as such Holder or
underwriter shall reasonably request.
j. The Company shall enter into an underwriting agreement with the
managing underwriter selected for such underwriting by Holders holding a
Majority of the Warrants and Warrant Shares requested to be included in such
underwriting, which may be the Underwriter. Such agreement shall be satisfactory
in form and substance to the Company, each Holder and such managing underwriter,
and shall contain such representations, warranties and covenants by the Company
and such other terms as are customarily contained in agreements of that type
used by the managing underwriter. Such Holders shall not be required to make any
representations or warranties to or arrangements with the Company or the
underwriter except as they may relate to such Holders and their intended methods
of distribution.
k. The Company shall include in the registration statement any other
securities of the Company held by such Holder(s) as of the date of filing of
such registration statement, including without limitation, restricted shares of
Common Stock, options, warrants or any other securities convertible into shares
of Common Stock.
l. For purposes of this Agreement, the term "Majority" in reference to
the Holders of Warrants or Warrant Shares shall mean in excess of 50% of the
then outstanding Warrants or Warrant Shares that (i) are not held by the
Company, an affiliate, officer, creditor, employee or agent thereof or any of
their respective affiliates, members of their family, persons acting as nominees
or in conjunction therewith and (ii) have not been resold to the public pursuant
to a registration statement filed with the Commission under the Act.
SECTION 13 - MISCELLANEOUS:
13.1 ORIGINAL ISSUE TAXES. The Company will pay all United States, state and
local (but not foreign) original issue taxes, if any, upon the issuance of this
Warrant and the Warrant Shares.
12
13.2 AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions
of this Warrant may be amended, and the Company may take any action herein
prohibited or omit to perform any act herein required to be performed by it,
only if the Company has obtained the written consent of the Holders of the
Warrants representing at least 50% of the shares of Common Stock obtainable upon
the exercise of the Warrants outstanding at the time of such consent.
13.3 NOTICE. Any notices required to be sent to a Holder of this Warrant or of
any Warrant Shares purchased upon the exercise hereof will be delivered to the
address or such Holder shown on the books of the Company. All notices referred
to herein will be delivered in person or sent by registered or certified mail,
postage prepaid, and will he deemed to have been given when so delivered in
person or on the third business day following the date so sent by mail.
If to the Holder:
---------------------------
---------------------------
---------------------------
With a copy to:
---------------------------
---------------------------
---------------------------
If to the Company:
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ corp.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇, President
With a copy to:
Broad and ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
Suite 3000
Miami, Florida 33131
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esquire
13.4 DESCRIPTIVE HEADINGS. The descriptive headings of the sections and
paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant.
13.5 GOVERNING LAW. This Warrant is governed by, interpreted under and construed
in all respects in accordance with the substantive laws of the State of Florida,
without regard to the conflicts of law provisions thereof, and irrespective of
the place of domicile or residence of the party. In the event of a controversy
arising out of the interpretation, construction, performance or breach of this
Warrant, the parties hereby agree and consent to the jurisdiction and venue of
the courts of the State of Florida; and further agree and consent that personal
service of process in any such action or proceeding outside the State of Florida
shall be tantamount to service in person in Florida.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
and attested by its duly authorized officer.
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ corp., a
Florida corporation
By:
------------------------------------
Name:
------------------------------------
Title:
------------------------------------
Attest:
_______________________________
________________, Secretary
14
EXHIBIT I
EXERCISE AGREEMENT
To: Dated:
The undersigned Record Holder, pursuant to the provisions set forth in
the within Warrant, hereby subscribes for and purchases _______ Warrant Shares
covered by such Warrant and herewith makes full cash payment of $
_______________ for such Warrant Shares at the Exercise Price provided by such
Warrant.
(Signature)
---------------------------------
---------------------------------
(print or type name)
---------------------------------
---------------------------------
---------------------------------
(Address)
NOTICE: The signature on this Exercise Agreement must correspond with the name
its written upon the face of the within Warrant, or upon the Assignment thereof
if applicable, in every particular, without alteration, enlargement, or any
change whatsoever, and must be medallion guaranteed by a bank, other than a
savings bank, having an office or correspondent in Florida, or by a firm having
membership on a registered national securities exchange and an office in
Florida.
MEDALLION SIGNATURE GUARANTEE
Authorized Signature:
Name of Bank or Firm:
Dated:
---------------------------
EXHIBIT II
ASSIGNMENT
FOR VALUE RECEIVED, _________________________________, the undersigned
Holder hereby sells, assigns, and transfers all of the rights of the undersigned
under the within Warrant with respect to the number of Warrant Shares covered
thereby set forth below, unto the Assignee identified below, and does hereby
irrevocably constitute and appoint ___________________________________ to effect
such transfer of rights on the books of the Company, with full power of
substitution:
NAME OF ASSIGNEE ADDRESS OF ASSIGNEE NO. OF WARRANT SHARES
Dated:
----------------------------
-----------------------------------------
(Signature of Holder)
-----------------------------------------
(Print or type name)
NOTICE: The signature on this Assignment must correspond with the name as
written upon the face of the within Warrant, in every particular, without
alteration, enlargement, or any change whatsoever, and must be medallion
guaranteed by a bank, other than a savings bank, having an office or
correspondent in Florida, or by a firm having membership on a registered
national securities exchange and an office in Florida.
MEDALLION SIGNATURE GUARANTEE
Authorized Signature:
Name of Bank or Firm:
Dated:
-----------------------------