EX-4.2
Underwriter's Common Stock Purchase Warrant
COMMON STOCK PURCHASE WARRANT
PURO WATER GROUP, INC.
Dated: _____ __, 1996
THE REGISTERED HOLDER OF THIS WARRANT BY ITS ACCEPTANCE HEREOF, AGREES THAT IT
WILL NOT SELL, TRANSFER OR ASSIGN THIS WARRANT EXCEPT AS HEREIN PROVIDED.
NOT EXERCISABLE PRIOR TO _____, 1997. VOID AFTER 5:00 P.M. EASTERN TIME, ______,
2001.
WU-1
COMMON STOCK PURCHASE WARRANT
For the Purchase of 135,000 Shares of Common Stock
of
PURO WATER GROUP, INC.
(A Delaware Corporation)
1. Warrant.
THIS CERTIFIES THAT, in consideration of $135.00 duly paid by or on
behalf of ▇▇▇▇▇▇▇ Equities, Inc. (or registered assigns succeeding to ownership
hereof pursuant to the provisions of Section 4.1 hereof) (the "Holder"), as
registered owner of this Warrant, to Puro Water Group, Inc. (the "Company"), the
Holder is entitled, at any time and from time to time on or after ______, 1997,
and at or before 5:00 p.m., Eastern Time, ______, 2001 (the "Expiration Date"),
but not thereafter, to subscribe for, purchase and receive, in whole or in part,
up to one hundred and thirty-five thousand (135,000) shares of Common Stock,
[$0.003125] par value (the "Common Stock"), of the Company. If the Expiration
Date is a day on which banking institutions are authorized by law to close, then
this Warrant may be exercised on the next succeeding day that is not such a day
in accordance with the terms hereof. During the period ending on the Expiration
Date, the Company agrees not to take any action that would terminate this
Warrant. This Warrant is initially exercisable as to each share of Common Stock
covered thereby at 120% of the offering price per share of Common Stock (the
"Exercise Price") set forth on the cover page of the prospectus pursuant to
which 1,350,000 shares of Common Stock of the Company are being offered to the
public (the "Prospectus"). The term "Exercise Price" shall mean the initial
exercise price or such exercise price, as adjusted in the manner provided
herein, depending on the context. This Warrant, together with warrants of like
tenor, was originally issued pursuant to an Underwriting Agreement dated ______,
1996 between the Company and ▇▇▇▇▇▇▇ Equities, Inc. (the "Underwriter").
2. Exercise.
In order to exercise this Warrant, the exercise form attached hereto must
be duly executed, completed and delivered to the Company, together with this
Warrant and payment of the Exercise Price for the shares of the Common Stock
being purchased. If the rights represented hereby shall not be exercised at or
before 5:00 p.m., Eastern Time, on the Expiration Date, this Warrant shall
become and be void and without further force or effect and all rights
represented hereby shall cease and expire.
3. Cashless Exercise.
3.1 Determination of Amount. In lieu of the payment of the Exercise Price
in the manner required by Section 2, the Holder shall have the right (but not
the obligation) to pay the Exercise Price for the Shares of Common Stock being
purchased with this Warrant upon exercise by the surrender to the Company of any
exercisable but unexercised portion of this Warrant having a "Value" (as defined
below), at the close of trading on the last trading day immediately preceding
the exercise of this Warrant, equal to the Exercise Price multiplied by the
number of Shares of Common Stock being purchased upon exercise ("Cashless
Exercise Right"). The sum of (a) the number of Shares of Common Stock being
purchased upon exercise of the non-surrendered portion of this Warrant pursuant
to this Cashless Exercise Right and (b) the number of Shares of Common Stock
underlying the portion of this Warrant being surrendered, shall not in any event
be greater than the total number of Shares of Common Stock purchasable upon the
complete exercise of this Warrant if the Exercise Price were paid in cash. Upon
exercise of the conversion right, the Company shall deliver to the Holder
(without payment by the Holder of any of the Exercise Price) that number of
shares of Common Stock equal to the quotient obtained by dividing (x) the
"Value" (as defined below) of the portion of the Warrant being converted at the
time the conversion right is exercised by (y) the Exercise Price. The "Value" of
the portion of the Warrant being surrendered shall equal the remainder derived
from subtracting (a) the Exercise Price multiplied by the number of Shares of
Common Stock underlying the portion of this Warrant being surrendered from (b)
the Market Price of the Shares of Common Stock multiplied by the number of
Shares of Common Stock underlying the portion of this Warrant being surrendered.
As used herein, the term "Market Price" at any date shall be deemed to be the
last reported sale price of the Shares of Common Stock on such date, or, in case
no such reported sale takes place on such day, the average of the last reported
sale prices for the immediately preceding three trading days, in either case as
officially reported by the principal securities exchange on which the Shares of
Common Stock are listed or admitted to trading, or, if the Shares of Common
Stock are not listed or admitted to trading on any national securities exchange
or if any such exchange on which the shares of Common Stock are listed is not
its principal trading market, the
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last reported sale price as furnished by the NASD through the Nasdaq National
Market or SmallCap Market, or, if applicable, the OTC Bulletin Board, or if the
Shares of Common Stock are not listed or admitted to trading on the Nasdaq
National Market or SmallCap Market or OTC Bulletin Board or similar
organization, as determined in good faith by resolution of the Board of
Directors of the Company, based on the best information available to it.
3.2 Mechanics of Cashless Exercise. The Cashless Exercise Right may be
exercised by the Holder on any business day on or after the Commencement Date
and not later than the Expiration Date by delivering the Warrant with a duly
executed exercise form attached hereto with the cashless exercise section
completed to the Company, exercising the Cashless Exercise Right and specifying
the total number of Shares of Common Stock the Holder will purchase pursuant to
such Cashless Exercise Right.
4. Transfer
4.1 General Restrictions. The registered Holder of this Warrant, by its
acceptance hereof, agrees that it shall not sell, transfer or assign or
hypothecate this Warrant to anyone other than (i) an officer or partner or such
Holder, (ii) an officer of the Underwriter or an officer or partner of any
Selected Dealer in connection with the Company's public offering with respect to
which this Warrant has been issued, or (iii) any Selected Dealer or member of
the underwriting syndicate prior to the Commencement Date. In order to make any
permitted assignment, the Holder must deliver to the Company the assignment form
attached hereto duly executed and completed, together with this Warrant and
payment of all transfer taxes, if any, payable in connection therewith. The
Company shall immediately transfer the number of Warrants specified in the
assignment form on the books of the Company and shall execute and deliver a new
warrant or warrants of like tenor to the appropriate assignee(s) expressly
evidencing the right to purchase the number of shares of Common Stock
purchasable hereunder or such portion of such number as shall be contemplated by
such assignment.
4.2 Restrictions Imposed by the Act. The securities purchased upon
exercise of this Warrant shall not be transferred unless and until (i) the
Company has received the opinion of counsel for the Holder (reasonably
acceptable to the Company and its counsel) that the securities may be sold
pursuant to an exemption from registration under the Securities Act of 1933, as
amended (the "Act"), the availability of which is established to the reasonable
satisfaction of the Company, or (ii) a registration statement relating to such
securities has been filed by the Company and declared effective by the
Securities and Exchange Commission (the "Commission").
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Each certificate for securities purchased upon exercise of this Warrant
shall bear a legend as follows unless such securities have been registered under
the Act:
"The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended (the "Act"). The securities
may not be offered for sale, sold or otherwise transferred except pursuant
to an effective registration statement under the Act, or pursuant to an
exemption from registration under the Act."
5. New Warrants to be Issued.
5.1 Partial Exercise or Transfer. Subject to the restrictions in Section 4
hereof, this Warrant may be exercised or assigned in whole or in part. In the
event of the exercise or assignment hereof in part only, upon surrender of this
Warrant for cancellation, together with the duly executed exercise or assignment
form and funds sufficient to pay any required transfer tax, the Company shall
cause to be delivered to the Holder without charge a new warrant or new warrants
of like tenor with this Warrant in the name of the Holder evidencing the right
to purchase, in the aggregate, the remaining number of underlying shares of
Common Stock purchasable hereunder after giving effect to any such partial
exercise or assignment.
5.2 Lost Certificate. Upon receipt by the Company of evidence satisfactory
to it of the loss, theft, destruction or mutilation of this Warrant and of an
indemnification in favor of the Company, reasonably satisfactory to it, the
Company shall execute and deliver a new warrant of like tenor and date. Any such
new warrants executed and delivered as a result of such loss, theft, mutilation
or destruction shall constitute an additional contractual obligation on the part
of the Company.
6. Registration Rights.
6.1 Demand Registration.
6.1.1 Grant of Right. The Company, upon written demand (the "Initial
Demand Notice") of the Holder(s) of at least fifty-one percent (51%) of the
Warrants initially issued to the Underwriter and/or the underlying securities
(the "Majority Holders"), agrees to register on one occasion, all of the shares
of Common Stock underlying such Warrants (the "Registrable Securities"). On such
occasion, the Company shall file a Registration Statement covering the
Registrable Securities within thirty (30) days after receipt of the Initial
Demand Notice and shall use its best efforts to have such registration statement
declared effective promptly thereafter. The demand for registration may be made
at any time during a period of four years
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beginning one year after the date of the Prospectus (the "Effective Date"). The
Company covenants and agrees to give written notice of its receipt of any
Initial Demand Notice by any Holder(s) to all other registered Holders of the
Warrants and/or the Registrable Securities within five (5) days after the date
of the receipt of any such Initial Demand Notice.
6.1.2 Terms. The Company shall bear all fees and expenses attendant
to registering the Registrable Securities, but the Holder(s) shall pay any and
all underwriting commissions and the expenses of any legal counsel selected by
the Holder(s) to represent them in connection with the sale of the Registrable
Securities and any applicable transfer taxes. The Company agrees to use its
prompt best efforts to cause the filing required herein to become effective and
to qualify or register the Registrable Securities in such states as are
reasonably requested by the Holder(s); provided, however, that in no event shall
the Company be required to register the Registrable Securities in a state in
which such registration would cause (i) the Company to be obligated to qualify
to do business as a foreign corporation in such State or to pay income,
franchise or other similar taxes solely as a result of such registration or to
be subject to service of general process, or (ii) the principal stockholders of
the Company to be obligated to escrow their shares of capital stock of the
Company. The Company shall cause any registration statement filed pursuant to
the demand rights granted under Section 6.1.1 to remain effective for a period
of at least twelve (12) consecutive months after the effective date of such
registration statement. The terms of this Section 6.1 may not be modified,
amended or deleted without the prior consent of the Underwriter.
6.1.3 Repurchase of Warrants and Registrable Shares. Anything in
this Section 6.1 to the contrary notwithstanding, the Company shall have no such
obligation to prepare and file a registration statement as provided for in this
Section 6.1 if, within twenty (20) days after it receives a demand therefor, it
agrees to purchase the Warrants and/or the underlying Registrable Securities
from the Holder(s) thereof at a price, in the case of the Warrants, equal to the
difference between the Exercise Price and the then current market price of the
Common Stock and, in the case of the Registrable Securities, at the current
market price of the Common Stock. The current market price of the Common Stock
shall be the average of the closing bid and asked prices for the Common Stock
during the five (5) business day period preceding such demand for registration.
The Majority Holders may, at their option, demand the registration of the
Registrable Securities in a registration statement as contemplated by Section
6.1 or in connection with a request made pursuant to Section 6.2 prior to the
acquisition of the Registrable Securities upon exercise of the Warrants even
though any such Holder has not given notice of exercise of the Warrants. Any
such Holder may thereafter at its option, exercise the Warrants at any time or
from
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time to time subsequent to the effectiveness under the Act of the registration
statement in which the Registrable Securities were included.
6.2 "Piggy-Back" Registration.
6.2.1 Grant of Right. In addition to the demand right of
registration, the Holder(s) of the Warrants shall have the right for a period of
four (4) years beginning one year after the Effective Date, to include the
Registrable Securities as part of any other registration of securities filed by
the Company (other than in connection with a transaction contemplated by Rule
145(a) promulgated under the Act or pursuant to Form S-8), at the Company's sole
cost and expense, provided, however, that if, in the written opinion of the
Company's managing underwriter or underwriters, if any, for such offering, the
inclusion of the Registrable Securities, when added to the securities being
registered by the Company or the selling shareholder(s), will exceed the maximum
amount of the Company's securities that can be marketed (i) at a price
reasonably related to their then current market value, or (ii) without
materially and adversely affecting the entire terms of the offering, the Company
shall nevertheless register all or any portion of the Registrable Securities
required to be so registered but such Registrable Securities shall not be sold
by the Holder(s) until 180 days after the registration statement for such
offering has become effective and provided further that, if any securities are
registered for sale on behalf of other shareholders in such offering and such
shareholders have not agreed to defer such sale until the expiration of such
180-day period, the number of securities to be sold by all shareholders in such
public offering during such 180-day period shall be apportioned pro rata among
all such selling shareholders, including all holders of the Registrable
Securities, according to the total amount of securities of the Company owned by
said selling shareholders, including all holders of the Registrable Securities.
6.2.2 Terms. The Company shall bear all fees and expenses attendant
to registering the Registrable Securities, but the Holder(s) shall pay any and
all underwriting commissions, the expenses of any legal counsel selected by the
Holder(s) to represent them in connection with the sale of the Registrable
Securities and applicable transfer taxes, if any. In the event of such a
proposed registration, the Company shall furnish the then Holder(s) of
outstanding Registrable Securities with not less than thirty (30) days' written
notice prior to the proposed date of filing of such registration statement. Such
notice to the Holder(s) shall continue to be given for each registration
statement filed by the Company until such time as all of the Registrable
Securities have been registered and sold. The holders of the Registrable
Securities shall exercise the "piggyback" rights provided for herein by giving
written notice, within twenty (20) days after the receipt of the Company's
notice of its intention to
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file a registration statement. The Company shall cause any registration
statement filed pursuant to the above "piggyback" rights to remain effective for
at least twelve (12) months from the date that such registration statement is
declared effective by the Commission. The terms of this Section 6.2 may not be
modified, amended or deleted without the prior consent of the Underwriter.
6.3 General Terms.
6.3.1 Indemnification. The Company shall indemnify the Holder(s) of
the Registrable Securities to be sold pursuant to any registration statement
hereunder and each person, if any, who controls such Holder(s) within the
meaning of Section 15 of the Act or Section 20(a) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), against all loss, claim, damage,
expense or liability (including all reasonable attorneys' fees and other
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 effect as the provisions pursuant to which the
Company has agreed to indemnify the Underwriter contained in Section 5 of the
Underwriting Agreement. The Holder(s) of the Registrable Securities to be sold
pursuant to such registration statement, and their successors and assigns, shall
severally, and not jointly, indemnify the Company against all loss, claim,
damage, expense or liability (including all reasonable attorneys' fees and other
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 ▇▇▇▇▇▇(s), or their successors or assigns, in writing, for specific
inclusion in such registration statement to the same extent and with the same
effect as the provisions contained in Section 5 of the Underwriting Agreement
pursuant to which the Underwriter have agreed to indemnify the Company.
6.3.2 Exclusivity. The Company shall not permit the inclusion of any
securities other than the Registrable Securities to be included in any
registration statement filed pursuant to Section 6.1 hereof without the prior
written consent of the Majority Holders of the Registrable Securities.
6.3.3 Documents Delivered to Holders. The Company shall furnish to
each Holder participating in any of the foregoing offerings and to each
underwriter of any such offering, 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 any underwriting agreement related thereto), and (ii) a "cold
comfort" letter dated the effective date of such
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registration statement (and, if such registration includes an underwritten
public offering, a letter dated the date of closing under the underwriting
agreement) signed by 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 as appropriate for the form of registration statement
used. The Company shall also deliver promptly to each Holder participating in
the offering requesting the correspondence and memoranda described below and to
the managing underwriter 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 laws or rules of the National Association of Securities
Dealers, Inc. ("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 any such Holder shall reasonably request.
Following the effective date of any such registration, the Company shall upon
the request of any owner of Warrants and/or Registrable Securities forthwith
supply such a number of prospectuses meeting the requirements of the Act, as
shall be reasonably requested to make a public offering of the Registrable
Securities from time to time offered or sold by such owner.
6.3.4 Underwriting Agreement. The Company shall enter into an
underwriting agreement with the managing underwriter(s) selected by any
▇▇▇▇▇▇(s) whose Registrable Securities are being registered pursuant to this
Section 6. Such agreement shall be reasonably satisfactory in form and substance
to the Company, each Holder and such managing underwriters, 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. The Holder(s) shall be parties to any underwriting
agreement relating to an underwritten sale of their Registrable Securities and
may, at their option, require that any or all of the representations, warranties
and covenants of the Company to or for the benefit of such underwriters shall
also be made to and for the benefit of such Holder(s). Such Holder(s) shall not
be required to make any representations or warranties to or agreements with the
Company or
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the underwriters except as they may relate to such ▇▇▇▇▇▇(s) and their intended
methods of distribution.
7. Adjustments to Exercise Price and Number of Securities.
7.1 Subdivision and Combination. In case the Company shall at any time
subdivide or combine the outstanding shares of Common Stock, the Exercise Price
shall forthwith be proportionately decreased in the case of subdivision or
increased in the case of combination.
7.2 Adjustment in Number of Shares. Upon each adjustment of the Exercise
Price pursuant to the provisions of this Section 7, the number of shares of
Common Stock issuable upon the exercise of this Warrant shall be adjusted to the
nearest full number obtained by multiplying the Exercise Price in effect
immediately prior to such adjustment by the number of shares of Common Stock
issuable upon exercise of this Warrant immediately prior to such adjustment and
dividing the product so obtained by the adjusted Exercise Price.
7.3 Recapitalization. For the purpose of this Warrant, the term "Common
Stock" shall also mean any other class of stock resulting from successive
changes or reclassifications of 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.
7.4 Stock Dividends - Recapitalization, Reclassification, Split-Ups. If
after the date hereof the number of outstanding shares of Common Stock is
increased by a stock dividend payable in shares of Common Stock or by a
split-up, recapitalization or reclassification of shares of Common Stock or
other similar event, then, on the effective date thereof, the number of shares
of Common Stock issuable on exercise of the Warrant shall be increased in
proportion to such increase in outstanding shares.
7.5 Aggregate of Shares. If after the date hereof, the number of
outstanding shares of Common Stock is decreased by a consolidation, combination
or reclassification of shares of Common Stock or other similar event, then, upon
the effective date thereof, the number of shares of Common Stock issuable on
exercise of the Warrant shall be decreased in proportion to such decrease in
outstanding shares.
7.6 Merger or Consolidation. In case of any consolidation of the Company
with, or merger of the Company with, or merger of the Company into, another
corporation (other than a consolidation or merger which does not result in any
reclassification or change of the outstanding Common Stock), the corporation
formed by such consolidation or merger shall execute and deliver to the
Holder(s) a supplemental warrant providing that
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the holder of each warrant then outstanding or to be outstanding shall have the
right thereafter (until the stated expiration of such warrant) to receive, upon
exercise of such warrant, the kind and amount of shares of stock and other
securities and property receivable upon such consolidation or merger, by a
holder of the number of shares of Common Stock of the Company for which such
warrants might have been exercised immediately prior to such consolidation,
merger, sale or transfer. Such supplemental warrants shall provide for
adjustments which shall be identical to the adjustments provided in Section 7.
The above provision of this Section shall similarly apply to successive
consolidations or mergers.
7.7 No Adjustment of Exercise Price in Certain Cases. No adjustment of the
Exercise Price shall be made:
(i) Upon the issuance or sale of the shares of Common Stock issuable upon
the exercise of (i) this Warrant or (ii) the options granted under the stock
option plan described in the Prospectus; or
(ii) If the amount of said adjustment shall be less than two cents ($.02)
per share of Common Stock, provided, however, that in such case, any adjustment
that would otherwise be required then to be made shall be carried forward and
shall be made at the time of and together with the next subsequent adjustment
which, together with any adjustment so carried forward, shall amount to at least
two cents ($.02) per share of Common Stock.
7.8 Redemption of Warrants. Except as provided in Section 6.1.3 hereof,
this Warrant cannot be redeemed by the Company without the prior written consent
of the Holder.
7.9 Changes in Form of Warrant This form of Warrant need not be changed
because of any change pursuant to this Section, and Warrants issued after such
change may state the same Exercise Price and the same number of shares of Common
Stock as are stated in the Warrants initially issued pursuant to this Agreement.
The acceptance by any Holder of the issuance of new Warrants reflecting a
required or permissive change shall not be deemed to waive any rights to a prior
adjustment or the computation thereof.
7.10 Elimination of Fractional Interests. The Company shall not be
required to issue certificates representing fractions of shares of Common Stock
upon the exercise of the Warrant, nor shall it be required to issue scrip or pay
cash in lieu of any fractional interests, it being the intent of the parties
that all fractional interests shall be eliminated by rounding any fraction up to
the nearest whole number of shares of Common Stock or other securities,
properties or rights as shall be issuable upon the exercise thereof.
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8. Reservation and Listing. The Company shall at all times reserve and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon exercise of the Warrant, such number of shares of Common Stock
or other securities, properties or rights as shall be issuable upon the exercise
thereof. The Company covenants and agrees that, upon exercise of the Warrant and
payment of the Exercise Price therefor, all shares of Common Stock and other
securities issuable, properties and rights upon such exercise shall be duly and
validly issued, fully paid and nonassessable and not subject to preemptive
rights of any stockholder. The Company further covenants and agrees that upon
exercise of this Warrant and payment of the Exercise Price therefor, all shares
of Common Stock and other securities issuable upon such exercises shall be duly
and validly issued, fully paid and nonassessable and not subject to preemptive
rights of any stockholder. As long as this Warrant shall be outstanding, the
Company shall use its best efforts to cause all shares of Common Stock issuable
upon exercise of the Warrant to be listed (subject to official notice of
issuance) on all securities exchanges (or, if applicable on NASDAQ) on which the
Common Stock may then be listed and/or quoted.
9. Certain Notice Requirements.
9.1 Holder's Right to Receive Notice. Nothing herein shall be construed as
conferring upon the Holder the right to vote or consent or to receive notice as
a stockholder for the election of directors or any other matter, or as having
any rights whatsoever as a stockholder of the Company. If, however, at any time
prior to the expiration of the Warrant and its exercise, any of the events
described in Section 9.2 shall occur, then, in one or more of said events, the
Company shall give written notice of such event at least fifteen (15) days prior
to the date fixed as a record date or the date of closing the transfer books for
the determination of the stockholders entitled to such dividend, distribution,
conversion or exchange of securities or subscription rights, or entitled to vote
on such proposed dissolution, liquidation, winding up or sale. Such notice shall
specify such record date or the date of the closing of the transfer books, as
the case may be.
9.2 Events Requiring Notice. The Company shall be required to give the
notice described in this Section 9 upon one or more of the following events: (i)
if the Company shall take a record of the holders of its shares of Common Stock
for the purpose of entitling them to receive a dividend or distribution payable
otherwise than in cash, or a cash dividend or distribution payable otherwise
than out of retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company, or (ii) the Company shall
offer to all the holders of its Common Stock any additional shares of capital
stock of the Company or securities convertible into or exchangeable for shares
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of capital stock of the Company, or any option, right or warrant to subscribe
therefor, or (iii) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale of all or
substantially all of its property, assets and business shall be proposed.
9.3 Notice of Change in Exercise Price. The Company shall, promptly after
an event requiring a change in the Exercise Price pursuant to Section 7 hereof,
send notice to the Holders of such event and change (the "Price Notice"). The
Price Notice shall describe the event causing the change and the method of
calculating same and shall be certified as being true and accurate by the
Company's Chief Executive Officer and Chief Financial Officer.
9.4 Transmittal of Notices. All notices, requests, consents and other
communications under this Warrant shall be in writing and shall be deemed to
have been duly given or made when hand delivered, or when delivered by
responsible overnight courier:
(i) If to the registered Holder of this Warrant, to:
▇▇▇▇▇▇▇ Equities, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Managing Director
with a copy to:
Olshan ▇▇▇▇▇▇▇▇ Frome & ▇▇▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
(ii) if to the Company, to:
Puro Water Group, Inc.
▇▇-▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇, President
with a copy to:
▇▇▇, Berlin & ▇▇▇▇, P.C.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Either of the Holder or the Company may change the foregoing address by notice
given pursuant to this Section 9.4.
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10. Miscellaneous.
10.1 Amendments. The Company and the Holder may from time to time
supplement or amend this Warrant without the approval of any other Holder in
order to cure any ambiguity, to correct or supplement any provision contained
herein which may be defective or inconsistent with any other provisions herein,
or to make any other provisions in regard to matters or questions arising
hereunder which the Company and the Underwriter may deem necessary or desirable
and which the Company and the Underwriter deem shall not adversely affect the
interest of the Holder. All other modifications or amendments shall require the
written consent of the party against whom enforcement of the modification or
amendment is sought.
10.2 Headings. The headings contained herein are for the sole purpose of
convenience of reference, and shall not in any way limit or affect the meaning
or interpretation of any of the terms or provisions of this Warrant.
10.3 Entire Agreement. This Warrant (together with the other agreements
and documents being delivered pursuant to or in connection with this Warrant)
constitute the entire agreement of the parties hereto with respect to the
subject matter hereof, and supersede all prior agreements and understandings of
the parties, oral and written, with respect to the subject matter hereof.
10.4 Binding Effect. This Warrant shall inure solely to the benefit of and
shall be binding upon, the Holder and the Company and their permitted assignees,
respective successors, legal representatives and assigns, and no other person
shall have or be construed to have any legal or equitable right, remedy or claim
under or in respect of or by virtue of this Warrant or any provisions herein
contained.
10.5 Governing Law; Submission to Jurisdiction. This Warrant shall be
governed by and construed and enforced in accordance with the laws of the State
of New York, without giving effect to conflict of laws. Any action, proceeding
or claim against the Company or the Holder arising out of, or relating in any
way to this Warrant shall be brought and enforced in the courts of the State of
New York or of the United States of America for the Southern District of New
York, and the Company and the Holder irrevocably submit to such jurisdiction,
which jurisdiction shall be exclusive. The parties hereto waive any objection to
such exclusive jurisdiction and that such courts represent an inconvenient
forum. The prevailing party in any such action shall be entitled to recover from
the other party all of its reasonable attorneys' fees and expenses relating to
such action or proceeding and/or incurred in connection with the preparation
therefor.
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10.6 Waiver, Etc. The failure of the Company or the Holder to at any time
enforce any of the provisions of this Warrant shall not be deemed or construed
to be a waiver of any such provision, nor to in any way affect the validity of
this Warrant or any provision hereof or the right of the Company or any Holder
to thereafter enforce each and every provision of this Warrant. No waiver of any
breach, noncompliance or nonfulfillment of any of the provisions of this Warrant
shall be effective unless set forth in a written instrument executed by the
party or parties against whom or which enforcement of such waiver is sought; and
no waiver of any such breach, noncompliance or nonfulfillment shall be construed
or deemed to be a waiver of any other or subsequent breach, noncompliance or
nonfulfillment.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer on the _______ day of ______, 1996.
PURO WATER GROUP, INC.
By:________________________________
Name: ▇▇▇▇ ▇▇▇▇
Title: President
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Form to be used to exercise Warrant:
Puro Water Group, Inc.
▇▇-▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Date: ________________, ____
The undersigned hereby elects irrevocably to exercise the within
Warrant and to purchase __________ shares of Common Stock of Puro Water Group,
Inc., and hereby makes payment of $_____________ (at the rate of $______________
per share) in payment of the Exercise Price pursuant thereto. Please issue the
shares as to which this Warrant is exercised in accordance with the instructions
given below.
OR
The undersigned hereby elects irrevocably to exercise the within
Purchase Option and to purchase __________ shares of Common Stock of Puro Water
Group, Inc. by surrender of the unexercised portion of the within warrant (with
a "Value" of $__________ based on a "Market Price" of $__________). Please issue
the Common Stock comprising the Warrant in accordance with the instructions
given below.
___________________________________
Signature
___________________________________
Signature Guaranteed
INSTRUCTIONS FOR REGISTRATION OF SECURITIES
Name____________________________________________________________________________
(Print in Block Letters)
Address_________________________________________________________________________
NOTICE: The signature to this form must correspond with the name as
written upon the face of the within Warrant in every particular without
alteration or enlargement or any change whatsoever, and must be guaranteed by a
bank, other than a savings bank, or by a trust company or by a firm having
membership on a registered national securities exchange.
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Form to be used to assign Warrant:
ASSIGNMENT
(To be executed by the registered Holder to effect a transfer of the
within Warrant):
FOR VALUE RECEIVED, ________________________________ does hereby
sell, assign and transfer unto __________________________ the right to purchase
____________ shares of Common Stock of Puro Water Group, Inc. (the "Company")
evidenced by the within Warrant and does hereby authorize the Company to
transfer such right on the books of the Company.
Dated:__________________, ____
___________________________________
Signature
___________________________________
Signature Guaranteed
NOTICE: The signature to this form must correspond with the name as
written upon the face of the within Warrant in every particular without
alteration or enlargement or any change whatsoever, and must be guaranteed by a
bank, other than a savings bank, or by a trust company or by a firm having
membership on a registered national securities exchange.
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