EXHIBIT 10.2
EXECUTION VERSION
VOID AFTER 5:00 P.M., NEW YORK CITY
TIME, ON ____________, 2010
(UNLESS EXTENDED PURSUANT TO SECTION 2 HEREOF)
THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER JURISDICTION. THE SECURITIES REPRESENTED HEREBY MAY
NOT BE OFFERED, SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS
UNLESS OFFERED, SOLD OR TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THOSE LAWS.
Right to Purchase 2,000,000 Shares of
Common Stock, par value $.01 per share
Date: _________, 2005
REMOTE DYNAMICS, INC.
STOCK PURCHASE WARRANT
THIS CERTIFIES THAT, for value received, SDS Capital Group SPC, Ltd., or
its registered and permitted assigns, is entitled to purchase from Remote
Dynamics, Inc., a corporation organized under the laws of the State of Delaware
(the "COMPANY"), at any time or from time to time during the period specified in
Section 2 hereof, Two Million (2,000,000) fully paid and nonassessable shares
(the "WARRANT SHARES") of the Company's common stock, par value $.01 per share
(the "COMMON STOCK"), at an initial exercise price per share (the "EXERCISE
PRICE") equal to $1.75. The number of Warrant Shares and the Exercise Price are
subject to adjustment as provided in Section 4 hereof. The term "WARRANT" and
all references thereto, as used throughout this instrument, shall mean this
instrument as originally executed, or if later amended or supplemented, then as
so amended or supplemented, including all Warrants issued upon transfer or
exchange of this Warrant as provided herein, and the term "WARRANTS" means this
Warrant and the other warrants of the Company issued pursuant to the Securities
Purchase Agreement dated as of May 31, 2005 by and among the Company and the
other signatories thereto (the "SECURITIES PURCHASE AGREEMENT").
This Warrant is subject to the following terms, provisions and conditions:
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1. Exercise of Warrant.
(a) Subject to the provisions hereof, including, without limitation, the
limitations contained in Section 10 hereof, this Warrant may be exercised by the
holder hereof, in whole or in part, by delivering (personally, by nationally
recognized overnight carrier or by confirmed facsimile transmission) a copy of
this Warrant and a completed exercise notice in the form attached hereto (the
"EXERCISE NOTICE"), to the Company during normal business hours on any business
day at the Company's principal executive offices (or such other office or agency
of the Company as it may designate by written notice to the holder hereof), and
upon (i) payment to the Company in cash, by certified or official bank check or
by wire transfer for the account of the Company, of the Exercise Price for the
Warrant Shares specified in the Exercise Notice or (ii) if the holder is
effectuating a Cashless Exercise (as defined in Section 9 hereof) pursuant to
Section 9 hereof, delivery to the Company of a written notice of an election to
effect a Cashless Exercise for the Warrant Shares specified in the Exercise
Notice. The holder shall surrender the Warrant to the Company concurrently with
the delivery of the Exercise Notice or promptly thereafter.
(b) The Warrant Shares purchased upon exercise of this Warrant in
accordance with this Section 1 shall be deemed to be issued to the holder hereof
or the holder's designee, as the record owner of such shares, as of the close of
business on the date on which a copy of this Warrant shall have been delivered,
the completed Exercise Notice shall have been delivered, and payment shall have
been made for such shares as set forth above or, if such date is not a business
day, on the next succeeding business day. The Warrant Shares so purchased,
representing the aggregate number of shares specified in the Exercise Notice,
shall be delivered to the holder hereof or the holder's designee within a
reasonable time, not exceeding two business days after the surrender of this
Warrant to the Company (the "DELIVERY PERIOD"). If the Company's transfer agent
is participating in the Depository Trust Company ("DTC") Fast Automated
Securities Transfer program, and so long as the certificates therefor do not
bear a legend (pursuant to the terms of the Securities Purchase Agreement) and
the holder is not obligated to return such certificate for the placement of a
legend thereon (pursuant to the Securities Purchase Agreement), the Company
shall cause its transfer agent to electronically transmit the Warrant Shares so
purchased to the holder or the holder's designee by crediting the account of the
holder or the holder's designee or its respective nominee with DTC through its
Deposit Withdrawal Agent Commission system ("DTC TRANSFER"). If the
aforementioned conditions to a DTC Transfer are not satisfied, the Company shall
deliver to the holder or the holder's designee physical certificates
representing the Warrant Shares so purchased. Notwithstanding the foregoing, the
holder or the holder's designee may instruct the Company to deliver to the
holder or such designee physical certificates representing the Warrant Shares so
purchased in lieu of delivering such shares by way of DTC Transfer. Any
certificates so delivered shall be in such denominations as may be reasonably
requested by the holder hereof or the holder's designee, shall be registered in
the name of the holder or such other name as shall be designated by the holder
and, following the date on which the Warrant Shares have been registered under
the Securities Act pursuant to that certain Registration Rights Agreement, dated
as of the initial issuance date of the Company's Series B Preferred Stock, by
and among the Company and the other signatories thereto (the "REGISTRATION
RIGHTS AGREEMENT") or otherwise may be sold by the holder pursuant to Rule 144
promulgated under the Securities Act (or a successor rule), shall not bear any
restrictive legend. If this Warrant shall have been exercised only in part, then
the Company shall, at its expense, at the time of delivery of such certificates,
deliver to the holder a
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new Warrant representing the number of shares with respect to which this Warrant
shall not then have been exercised.
(c) If, at any time, a holder of this Warrant submits this Warrant, an
Exercise Notice and payment to the Company of the Exercise Price for each of the
Warrant Shares specified in the Exercise Notice (including pursuant to a
Cashless Exercise), and the Company fails for any reason (other than the reasons
contemplated by Section 10 hereof) to deliver, on or prior to the fourth
business day following the expiration of the Delivery Period for such exercise,
the number of shares of Common Stock to which the holder is entitled upon such
exercise (an "EXERCISE DEFAULT"), then the Company shall pay to the holder
payments ("EXERCISE DEFAULT PAYMENTS") for an Exercise Default in the amount of
(i) (N/365), multiplied by (ii) the amount by which the Market Price (as defined
in Section 11 hereof) of the Common Stock on the date the Exercise Notice giving
rise to the Exercise Default is transmitted in accordance with this Section 1
(the "EXERCISE DEFAULT DATE") exceeds the Exercise Price in respect of such
Warrant Shares, multiplied by (iii) the number of shares of Common Stock the
Company failed to so deliver in such Exercise Default, multiplied by (iv) .18,
where N equals the number of days from the Exercise Default Date to the date
that the Company effects the full exercise of this Warrant which gave rise to
the Exercise Default. The accrued Exercise Default Payment for each calendar
month shall be paid in cash and shall be made to the holder by the fifth day of
the month following the month in which it has accrued. Nothing herein shall
limit the holder's right to pursue actual damages for the Company's failure to
maintain a sufficient number of authorized shares of Common Stock as required
pursuant to the terms of Section 3(b) hereof or to otherwise issue shares of
Common Stock upon exercise of this Warrant in accordance with the terms hereof,
and the holder shall have the right to pursue all remedies available at law or
in equity (including a decree of specific performance and/or injunctive relief).
2. Period of Exercise. This Warrant shall be exercisable at any time or from
time to time during the period (the "EXERCISE PERIOD") commencing on the
six-month anniversary of the date hereof (the "COMMENCEMENT DATE") and ending at
5:00 p.m., New York City time, on the fifth anniversary of the initial issuance
of this Warrant. The Exercise Period shall automatically be extended by one day
for each day on which (a) the Company does not have a number of shares of Common
Stock reserved for issuance upon exercise hereof at least equal to the number of
shares of Common Stock issuable upon exercise hereof or otherwise fails to
deliver shares of Common Stock in the names set forth in Section 1 hereof upon
proper exercise hereof, or (b) the Warrant Shares are not then otherwise
registered for resale as required pursuant to the terms of the Registration
Rights Agreement.
3. Certain Agreements of the Company. The Company hereby covenants and agrees
as follows:
(a) Shares to be Fully Paid. All Warrant Shares shall, upon issuance in
accordance with the terms of this Warrant, be validly issued, fully paid and
non-assessable and free from all taxes, liens, claims and encumbrances.
(b) Reservation of Shares. During the Exercise Period, the Company shall
at all times have authorized, and reserved for the purpose of issuance upon
exercise of this Warrant, a
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sufficient number of shares of Common Stock to provide for the exercise in full
of this Warrant (without giving effect to the limitations on exercise set forth
in Section 10 hereof).
(c) Listing. The Company shall use commercially reasonable efforts to
promptly secure the listing or quotation of the shares of Common Stock issuable
upon exercise of this Warrant upon each national securities exchange or
automated or electronic quotation system, if any, upon which shares of Common
Stock are then listed or quoted or become listed or quoted (subject to official
notice of issuance upon exercise of this Warrant) and shall maintain, so long as
any other shares of Common Stock shall be so listed or quoted, such listing or
quotation of all shares of Common Stock from time to time issuable upon the
exercise of this Warrant; and the Company shall so list or apply for quotation
on each national securities exchange or automated or electronic quotation
system, as the case may be, and shall maintain such listing or quotation of, any
other shares of capital stock of the Company issuable upon the exercise of this
Warrant if and so long as any shares of the same class shall be listed or quoted
on such national securities exchange or automated or electronic quotation
system.
(d) Certain Actions Prohibited. The Company shall not, by amendment of its
charter 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 to be
observed or performed by it hereunder, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant and in the
taking of all such action as may reasonably be requested by the holder of this
Warrant in order to protect the economic benefit inuring to the holder hereof
and the exercise privilege of the holder of this Warrant against dilution or
other impairment, consistent with the tenor and purpose of this Warrant. Without
limiting the generality of the foregoing, the Company (i) shall not increase the
par value of any shares of Common Stock receivable upon the exercise of this
Warrant above the Exercise Price then in effect, and (ii) shall take all such
actions as may be necessary or appropriate in order that the Company may validly
and legally issue fully paid and nonassessable shares of Common Stock upon the
exercise of this Warrant.
(e) Successors and Assigns. This Warrant shall be binding upon any entity
succeeding to the Company by merger, consolidation, or acquisition of all or
substantially all of the Company's assets.
(f) Dilutive Issuances. The Company shall not make a Dilutive Issuance, as
defined in the Certificate of Designation, Preferences and Rights of the
Company's Series B Preferred Stock) without first obtaining the consent of the
holder of this Warrant.
4. Antidilution Provisions. During the period beginning on the date of the
Securities Purchase Agreement and ending on the termination of the Exercise
Period (the "ADJUSTMENT PERIOD"), the Exercise Price and the number of Warrant
Shares issuable hereunder shall be subject to adjustment from time to time as
provided in this Section 4.
(a) Stock Splits, Stock Dividends, Etc. If, at any time during the
Adjustment Period, the number of outstanding shares of Common Stock is increased
by a stock split, stock dividend, combination, reclassification or other similar
event, the Exercise Price in effect immediately prior to such increase shall be
proportionately reduced, or if the number of outstanding shares of
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Common Stock is decreased by a reverse stock split, combination,
reclassification or other similar event, the Exercise Price in effect
immediately prior to such decrease shall be proportionately increased.
(b) Merger, Consolidation, Etc. If, at any time during the Adjustment
Period, there shall be (i) any reclassification or change of the outstanding
shares of Common Stock (other than a change in par value, or from par value to
no par value, or from no par value to par value, or as a result of a subdivision
or combination), (ii) any consolidation or merger of the Company with any other
entity (other than a merger in which the Company is the surviving or continuing
entity and its capital stock is unchanged), (iii) any sale or transfer of all or
substantially all of the assets of the Company or (iv) any share exchange or
other transaction pursuant to which all of the outstanding shares of Common
Stock are converted into other securities or property (each of (i) - (iv) above
being a "CORPORATE CHANGE"), then the holder hereof shall thereafter have the
right to receive upon exercise of this Warrant, in lieu of the Warrant Shares
otherwise issuable, such shares of stock, securities and/or other property as
would have been issued or payable in such Corporate Change with respect to or in
exchange for the number of Warrant Shares which would have been issuable upon
exercise had such Corporate Change not taken place (without giving effect to the
limitations contained in Section 10), and in any such case, appropriate
provisions (in form and substance reasonably satisfactory to the holder hereof)
shall be made with respect to the rights and interests of the holder to the end
that the economic value of this Warrant is in no way diminished by such
Corporate Change and that the provisions hereof (including, without limitation,
in the case of any such consolidation, merger or sale in which the successor
entity or purchasing entity is not the Company, an immediate adjustment of the
Exercise Price and Warrant Shares so that the Exercise Price and Warrant Shares
immediately after the Corporate Change reflects the same relative value as
compared to the value of the surviving entity's common stock that existed
between the Exercise Price and the Warrant Shares and the value of the Company's
Common Stock immediately prior to such Corporate Change) shall thereafter be
applicable, as nearly as may be practicable in relation to any shares of stock
or securities thereafter deliverable upon the exercise thereof. The Company
shall not effect any Corporate Change unless (A) the holder hereof has received
written notice of such transaction at least 30 days prior thereto, but in no
event later than 15 days prior to the record date for the determination of
stockholders entitled to vote with respect thereto, and (B) the resulting
successor or acquiring entity (if not the Company) assumes by written instrument
(in form and substance reasonable satisfactory to the holder hereof) the
obligations of the Company under this Warrant. The above provisions shall apply
regardless of whether or not there would have been a sufficient number of shares
of Common Stock authorized and available for issuance upon exercise hereof as of
the date of such transaction, and shall similarly apply to successive
reclassifications, consolidations, mergers, sales, transfers or share exchanges.
(c) Distributions. If, at any time during the Adjustment Period, the
Company shall declare or make any distribution of its assets (or rights to
acquire its assets) to holders of Common Stock as a partial liquidating
dividend, by way of return of capital or otherwise (including any dividend or
distribution to the Company's stockholders in cash or shares (or rights to
acquire shares) of capital stock of a subsidiary (i.e., a spin-off)) (a
"DISTRIBUTION"), then the holder hereof shall be entitled, upon any exercise of
this Warrant after the date of record for determining stockholders entitled to
such Distribution (or if no such record is taken, the date on which such
Distribution is declared or made), to receive the amount of such assets which
would
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have been payable to the holder with respect to the Warrant Shares issuable upon
such exercise (without giving effect to the limitations contained in Section 10)
had the holder hereof been the holder of such Warrant Shares on the record date
for the determination of stockholders entitled to such Distribution (or if no
such record is taken, the date on which such Distribution is declared or made).
(d) Convertible Securities and Purchase Rights. If, at any time during the
Adjustment Period, the Company issues any securities or other instruments which
are convertible into or exercisable or exchangeable for Common Stock
("CONVERTIBLE SECURITIES") or options, warrants or other rights to purchase or
subscribe for Common Stock or Convertible Securities ("PURCHASE RIGHTS") pro
rata to the record holders of any class of Common Stock, whether or not such
Convertible Securities or Purchase Rights are immediately convertible,
exercisable or exchangeable, then the holder hereof shall be entitled, upon any
exercise of this Warrant after the date of record for determining stockholders
entitled to receive such Convertible Securities or Purchase Rights (or if no
such record is taken, the date on which such Convertible Securities or Purchase
Rights are issued), to receive the aggregate number of Convertible Securities or
Purchase Rights which the holder would have received with respect to the Warrant
Shares issuable upon such exercise (without giving effect to the limitations
contained in Section 10) had the holder hereof been the holder of such Warrant
Shares on the record date for the determination of stockholders entitled to
receive such Convertible Securities or Purchase Rights (or if no such record is
taken, the date on which such Convertible Securities or Purchase Rights were
issued). If the right to exercise or convert any such Convertible Securities or
Purchase Rights would expire in accordance with their terms prior to the
exercise of this Warrant, then the terms of such Convertible Securities or
Purchase Rights shall provide that such exercise or convertibility right shall
remain in effect until 30 days after the date the holder receives such
Convertible Securities or Purchase Rights pursuant to the exercise hereof.
(e) Other Action Affecting Exercise Price. If, at any time during the
Adjustment Period, the Company takes any action affecting the Common Stock that
would be covered by Section 4(a) through (d), but for the manner in which such
action is taken or structured, which would in any way diminish the value of this
Warrant, then the Exercise Price shall be adjusted in such manner as the Board
of Directors of the Company shall in good faith determine to be equitable under
the circumstances.
(f) Adjustment in Number of Shares. Upon each adjustment of the Exercise
Price pursuant to the provisions of this Section 4, the number of shares of
Common Stock issuable upon exercise of this Warrant at each such Exercise Price
shall be adjusted by multiplying a number equal to the Exercise Price in effect
immediately prior to such adjustment by the number of shares of Common Stock
issuable upon exercise of this Warrant at such Exercise Price immediately prior
to such adjustment and dividing the product so obtained by the adjusted Exercise
Price.
(g) Notice of Adjustment. Upon the occurrence of any event which requires
any adjustment or readjustment of the Exercise Price or change in number or type
of stock, securities and/or other property issuable upon exercise of this
Warrant, then, and in each such case, the Company shall give notice thereof to
the holder hereof, which notice shall state the Exercise Price resulting from
such adjustment or readjustment and any change in the number of type of
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stock, securities and/or other property issuable upon exercise of this Warrant,
setting forth in reasonable detail the method of calculation and the facts upon
which such calculation is based. Such calculation shall be certified by the
chief financial officer of the Company.
(h) No Fractional Shares. No fractional shares of Common Stock are to be
issued upon the exercise of this Warrant, but the Company shall pay a cash
adjustment in respect of any fractional share which would otherwise be issuable
in an amount equal to the same fraction of the Market Price of a share of Common
Stock on the date of such exercise.
(i) Other Notices. In case at any time:
(i) the Company shall declare any dividend upon the Common Stock
payable in shares of stock of any class or make any other distribution (other
than dividends or distributions payable in cash out of retained earnings
consistent with the Company's past practices with respect to declaring dividends
and making distributions) to the holders of the Common Stock;
(ii) the Company shall offer for subscription pro rata to the
holders of the Common Stock any additional shares of stock of any class or other
rights;
(iii) there shall be any capital reorganization of the Company, or
reclassification of the Common Stock, or consolidation or merger of the Company
with or into, or sale of all or substantially all of its assets to, another
corporation or entity; or
(iv) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in each such case, the Company shall give to the holder of this Warrant
(A) notice of the date or estimated date on which the books of the Company shall
close or a record shall be taken for determining the holders of Common Stock
entitled to receive any such dividend, distribution, or subscription rights or
for determining the holders of Common Stock entitled to vote in respect of any
such reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding-up and (B) in the case of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding-up, notice of the date (or, if not then known, a reasonable estimate
thereof by the Company) when the same shall take place. Such notice shall also
specify the date on which the holders of Common Stock shall be entitled to
receive such dividend, distribution, or subscription rights or to exchange their
Common Stock for stock or other securities or property deliverable upon such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation, or winding-up, as the case may be. Such notice shall be given at
least thirty (30) days prior to the record date or the date on which the
Company's books are closed in respect thereto. Failure to give any such notice
or any defect therein shall not affect the validity of the proceedings referred
to in clauses (i), (ii), (iii) and (iv) above. Notwithstanding the foregoing,
the Company shall publicly disclose the substance of any notice delivered
hereunder prior to delivery of such notice to the holder hereof.
5. Issue Tax. The issuance of certificates for Warrant Shares upon the
exercise of this Warrant shall be made without charge to the holder of this
Warrant or such shares for any
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issuance tax or other costs in respect thereof, provided that the Company shall
not be required to pay any tax which may be payable in respect of any transfer
involved in the issuance and delivery of any certificate in a name other than
the holder of this Warrant.
6. No Rights or Liabilities as a Stockholder. This Warrant shall not entitle
the holder hereof to any voting rights or other rights as a stockholder of the
Company. No provision of this Warrant, in the absence of affirmative action by
the holder hereof to purchase Warrant Shares, and no mere enumeration herein of
the rights or privileges of the holder hereof, shall give rise to any liability
of such holder for the Exercise Price or as a stockholder of the Company,
whether such liability is asserted by the Company or by creditors of the
Company.
7. Transfer, Exchange, Redemption and Replacement of Warrant.
(a) Restriction on Transfer. This Warrant and the rights granted to the
holder hereof are transferable, in whole or in part, upon surrender of this
Warrant, together with a properly executed assignment in the form attached
hereto, at the office or agency of the Company referred to in Section 7(e)
below, provided, however, that any transfer or assignment shall be subject to
the conditions set forth in Sections 7(f) and 10 hereof and to the provisions of
Section 5 of the Securities Purchase Agreement. Until due presentment for
registration of transfer on the books of the Company, the Company may treat the
registered holder hereof as the owner and holder hereof for all purposes, and
the Company shall not be affected by any notice to the contrary. Notwithstanding
anything to the contrary contained herein, the registration rights described in
Section 8 hereof are assignable only in accordance with the provisions of the
Registration Rights Agreement.
(b) Warrant Exchangeable for Different Denominations. This Warrant is
exchangeable, upon the surrender hereof by the holder hereof at the office or
agency of the Company referred to in Section 7(e) below, for new Warrants of
like tenor of different denominations representing in the aggregate the right to
purchase the number of shares of Common Stock which may be purchased hereunder,
each of such new Warrants to represent the right to purchase such number of
shares (at the Exercise Price therefor) as shall be designated by the holder
hereof at the time of such surrender.
(c) Replacement of Warrant. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction, or mutilation of
this Warrant and, in the case of any such loss, theft, or destruction, upon
delivery of an indemnity agreement reasonably satisfactory in form and amount to
the Company, or, in the case of any such mutilation, upon surrender and
cancellation of this Warrant, the Company, at its expense, will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
(d) Cancellation; Payment of Expenses. Upon the surrender of this Warrant
in connection with any transfer, exchange, or replacement as provided in this
Section 7, this Warrant shall be promptly canceled by the Company. The holder
shall pay all taxes and all other expenses (other than legal expenses, if any,
incurred by the Company) and charges payable in connection with the preparation,
execution, and delivery of Warrants pursuant to this Section 7. The Company
shall indemnify and reimburse the holder of this Warrant for all losses and
damages arising as a result of or related to any breach of the terms of this
Warrant, including
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costs and expenses (including legal fees) incurred by such holder in connection
with the enforcement of its rights hereunder.
(e) Warrant Register. The Company shall maintain, at its principal
executive offices (or such other office or agency of the Company as it may
designate by notice to the holder hereof), a register for this Warrant, in which
the Company shall record the name and address of the person in whose name this
Warrant has been issued, as well as the name and address of each transferee and
each prior owner of this Warrant.
(f) Transfer or Exchange Without Registration. If, at the time of the
surrender of this Warrant in connection with any transfer or exchange of this
Warrant, this Warrant (or, in the case of any exercise, the Warrant Shares
issuable hereunder) shall not be registered under the Securities Act and under
applicable state securities or blue sky laws, the Company may require, as a
condition of allowing such transfer or exchange, (i) that the holder or
transferee of this Warrant, as the case may be, furnish to the Company a written
opinion of counsel (which opinion shall be in form, substance and scope
customary for opinions of counsel in comparable transactions) to the effect that
such transfer or exchange may be made without registration under the Securities
Act and under applicable state securities or blue sky laws (the cost of which
shall be borne by the Company if the Company's counsel renders such an opinion,
and up to $1,000 of such cost (subject to a maximum aggregate cost of $10,000)
shall be borne by the Company if the holder's counsel is required to render such
opinion), (ii) that the holder or transferee execute and deliver to the Company
an investment letter in form and substance acceptable to the Company and (iii)
that the transferee be an "ACCREDITED INVESTOR" as defined in Rule 501(a)
promulgated under the Securities Act.
8. Registration Rights. The initial holder of this Warrant (and certain
assignees thereof) is entitled to the benefit of such registration rights in
respect of the Warrant Shares as are set forth in the Registration Rights
Agreement, including the right to assign such rights to certain assignees, as
set forth therein.
9. Cashless Exercise. This Warrant may be exercised at any time after the
first anniversary of the date hereof and during the remaining Exercise Period by
presentation and surrender of this Warrant to the Company at its principal
executive offices with a written notice of the holder's intention to effect a
cashless exercise, including a calculation of the number of shares of Common
Stock to be issued upon such exercise in accordance with the terms hereof (a
"CASHLESS EXERCISE"). In the event of a Cashless Exercise, in lieu of paying the
Exercise Price in cash, the holder shall surrender this Warrant for that number
of shares of Common Stock determined by multiplying the number of Warrant Shares
to which it would otherwise be entitled by a fraction, the numerator of which
shall be the difference between the then current Market Price of a share of the
Common Stock on the date of exercise and the Exercise Price, and the denominator
of which shall be the then current Market Price per share of Common Stock.
10. Restrictions on Exercise and Transfer. In no event shall the holder hereof
have the right to exercise any portion of this Warrant for shares of Common
Stock or to dispose of any portion of this Warrant to the extent that such right
to effect such exercise or disposition would result in the holder and its
affiliates together beneficially owning more than 9.99% of the outstanding
shares of Common Stock. For purposes of this Section 10, beneficial ownership
shall be
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determined in accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended, and Regulation 13D-G thereunder. The restriction contained in
this Section 10 may not be altered, amended, deleted or changed in any manner
whatsoever unless the holders of a majority of the outstanding shares of Common
Stock and the holder hereof shall approve, in writing, such alteration,
amendment, deletion or change.
11. Certain Definitions. For purposes of this Warrant, the following
capitalized terms shall have the respective meanings assigned to them:
(a) "BUSINESS DAY" means any day, other than a Saturday or Sunday or a day
on which banking institutions in the State of New York are authorized or
obligated by law, regulation or executive order to close.
(b) "MARKET PRICE" means, for any security as of any date, the last sales
price of such security on the principal trading market where such security is
listed or traded as reported by Bloomberg Financial Markets (or a comparable
reporting service of national reputation selected by the Company and reasonably
acceptable to the holder hereof if Bloomberg Financial Markets is not then
reporting closing sales prices of such security) (in any case, "BLOOMBERG"), or
if the foregoing does not apply, the last reported sales price of such security
on a national exchange or in the over-the-counter market on the electronic
bulletin board for such security as reported by Bloomberg, or, if no such price
is reported for such security by Bloomberg, the average of the bid prices of all
market makers for such security as reported in the "pink sheets" by the National
Quotation Bureau, Inc., in each case for such date or, if such date was not a
trading day for such security, on the next preceding date which was a trading
day. If the Market Price cannot be calculated for such security as of either of
such dates on any of the foregoing bases, the Market Price of such security on
such date shall be the fair market value as reasonably determined by an
investment banking firm selected by the Company and reasonably acceptable to the
holder hereof, with the costs of such appraisal to be borne by the Company.
(c) "TRADING DAY" means any day on which the SmallCap Market or, if the
Common Stock is not then traded on the SmallCap Market, the principal national
securities exchange, automated quotation system or other trading market where
the Common Stock is then listed, quoted or traded, is open for trading.
12. Miscellaneous.
(a) Governing Law; Jurisdiction. This Warrant shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
contracts made and to be performed in the State of Delaware. The Company
irrevocably consents to the jurisdiction of the United States federal courts and
the state courts located in the County of New Castle, State of Delaware, in any
suit or proceeding based on or arising under this Warrant and irrevocably agrees
that all claims in respect of such suit or proceeding may be determined in such
courts. The Company irrevocably waives the defense of an inconvenient forum to
the maintenance of such suit or proceeding in such forum. The Company further
agrees that service of process upon the Company mailed by first class mail shall
be deemed in every respect effective service of process upon the Company in any
such suit or proceeding. Nothing herein shall affect the right of the holder to
serve process in any other manner permitted by law. The Company agrees that a
final
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non-appealable judgment in any such suit or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on such judgment or in any other
lawful manner.
(b) Construction. Whenever the context requires, the gender of any word
used in this Warrant includes the masculine, feminine or neuter, and the number
of any word includes the singular or plural. Unless the context otherwise
requires, all references to articles and sections refer to articles and sections
of this Warrant, and all references to schedules are to schedules attached
hereto, each of which is made a part hereof for all purposes. The descriptive
headings of the several articles and sections of this Warrant are inserted for
purposes of reference only, and shall not affect the meaning or construction of
any of the provisions hereof.
(c) Severability. If any provision of this Warrant shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Warrant or the
validity or enforceability of this Warrant in any other jurisdiction.
(d) Entire Agreement; Amendments. This Warrant contains the entire
understanding of the Company and the holder hereof with respect to the matters
covered herein. Subject to any additional express provisions of this Warrant, no
provision of this Warrant may be waived other than by an instrument in writing
signed by the party to be charged with enforcement, and no provision of this
Warrant may be amended other than by an instrument in writing signed by the
Company and the holder.
(e) Notices. Any notices required or permitted to be given under the terms
of this Warrant shall be sent by certified or registered mail (return receipt
requested) or delivered personally, by nationally recognized overnight carrier
or by confirmed facsimile transmission, and shall be effective five days after
being placed in the mail, if mailed, or upon receipt or refusal of receipt, if
delivered personally or by nationally recognized overnight carrier or confirmed
facsimile transmission, in each case addressed to a party. The initial addresses
for such communications shall be as follows, and each party shall provide notice
to the other parties of any change in such party's address:
(i) If to the Company:
Remote Dynamics, Inc.
0000 Xxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: X. Xxxxxxx Xxxxxx, Esquire
with a copy simultaneously transmitted by like means
(which transmittal shall not constitute notice
hereunder) to:
Xxxxx Xxxxxxx & Xxxx LLP
0000 Xxxx Xxxxxx
Xxxxx 0000
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Dallas, TX 75201-6776
Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: Xxxxxxx X. Xxxx. Esquire
(ii) If to the holder, at such address as shall be set forth in the
Warrant Register from time to time.
(f) Successors and Assigns. This Warrant shall be binding upon and inure
to the benefit of the Company, the holder and their respective permitted
successors and assigns. Except as provided herein, the Company shall not assign
this Warrant or its obligations hereunder. The holder hereof may assign or
transfer this Warrant and such holders rights hereunder in accordance with
Section 7 hereof.
(g) Equitable Relief. The Company acknowledges that a breach by it of its
obligations hereunder will cause irreparable harm to the holder by vitiating the
intent and purpose of this Warrant. Accordingly, the Company acknowledges that
the remedy at law for a breach of its obligations hereunder will be inadequate
and agrees, in the event of a breach or threatened breach by the Company of the
provisions of this Warrant, that the holder shall be entitled, in addition to
all other available remedies, to an injunction restraining any breach, without
the necessity of showing economic loss and without any bond or other security
being required.
[REMAINDER OF THIS PAGE LEFT BLANK INTENTIONALLY]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer.
REMOTE DYNAMICS, INC.
By:______________________________________
Name:
Title:
[SIGNATURE PAGE TO STOCK PURCHASE WARRANT]
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FORM OF EXERCISE NOTICE
(TO BE EXECUTED BY THE HOLDER IN ORDER TO EXERCISE THE WARRANT)
To: Remote Dynamics, Inc.
0000 Xxx Xxxxx, Xxxxx 0000
Xxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Chief Executive Officer
The undersigned hereby irrevocably exercises the right to purchase
_____________ shares of the Common Stock of Remote Dynamics, Inc., a corporation
organized under the laws of the State of Delaware (the "COMPANY"), at the
current Exercise Price of $____, evidenced by the attached Warrant, and herewith
[makes payment of the Exercise Price with respect to such shares in full][elects
to effect a Cashless Exercise (as defined in Section 9 of such Warrant)], all in
accordance with the conditions and provisions of said Warrant.
The undersigned agrees not to offer, sell, transfer or otherwise dispose
of any Common Stock obtained on exercise of the Warrant, except under
circumstances that will not result in a violation of the Securities Act of 1933,
as amended, or any state securities laws.
[ ] The undersigned requests that the Company cause its transfer
agent to electronically transmit the Common Stock issuable pursuant
to this Exercise Notice to the account of the undersigned or its
nominee (which is _________________) with DTC through its Deposit
Withdrawal Agent Commission System ("DTC TRANSFER"), provided that
such transfer agent participates in the DTC Fast Automated
Securities Transfer program.
[ ] In lieu of receiving the shares of Common Stock issuable
pursuant to this Exercise Notice by way of DTC Transfer, the
undersigned hereby requests that the Company cause its transfer
agent to issue and deliver to the undersigned physical certificates
representing such shares of Common Stock.
The undersigned requests that a Warrant representing any unexercised portion
hereof be issued, pursuant to the Warrant, in the name of the Holder and
delivered to the undersigned at the address set forth below:
Dated:_________________ _____________________________________
Signature of Holder
_____________________________________
Name of Holder (Print)
Address:
_____________________________________
_____________________________________
_____________________________________
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FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
all the rights of the undersigned under the within Warrant, with respect to the
number of shares of Common Stock covered thereby set forth hereinbelow, to:
Name of Assignee Address No. of Shares
---------------- ------- -------------
, and hereby irrevocably constitutes and appoints
_____________________________________ as agent and attorney-in-fact to transfer
said Warrant on the books of the within-named corporation, with full power of
substitution in the premises.
Dated: _____________________, ____
In the presence of
______________________
Name: ________________________________________
Signature:_____________________________________
Title of Signing Officer or Agent (if any):
Address: ______________________________________
______________________________________
______________________________________
Note: The above signature should correspond
exactly with the name on the face of
the within Warrant.
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