EXHIBIT 4.6
NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE
HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
APPLICABLE STATE SECURITIES LAW AND NEITHER MAY BE SOLD OR OTHERWISE TRANSFERRED
UNTIL (I) A REGISTRATION STATEMENT UNDER SUCH SECURITIES ACT AND SUCH APPLICABLE
STATE SECURITIES LAWS SHALL HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (II)
THE COMPANY SHALL HAVE RECEIVED A WRITTEN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY TO THE EFFECT THAT REGISTRATION UNDER SUCH SECURITIES ACT AND SUCH
APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED IN CONNECTION WITH SUCH
PROPOSED TRANSFER.
FORM OF PROVIDENTIAL HOLDINGS, INC.
COMMON STOCK PURCHASE WARRANT
Warrant No. ____ __,000 shares
ORIGINAL ISSUE DATE: MARCH 28, 2000
THIS CERTIFIES THAT, FOR VALUE RECEIVED, Sovereign Capital Advisors,
LLC or its designee or its assigns (the "Holder") is entitled to purchase, on
the terms and conditions hereinafter set forth, at any time or from time to time
from the date hereof until 5:00 p.m., Eastern Time, on third (3rd) anniversary
of the Original Issue Date set forth above, or if such date is not a day on
which the Company is open for business, then the next succeeding day on which
the Company is open for business (such date is the "Expiration Date"), but not
thereafter, to purchase up to _______ THOUSAND (___,000) shares of the Common
Stock, par value $.001 (the "Common Stock"), of PROVIDENTIAL HOLDINGS, INC., a
Nevada corporation (the "Company"), at $____ {110% of Closing Bid Price on
Original Issue Date} per share (the "Exercise Price"), such number of shares and
Exercise Price being subject to adjustment upon the occurrence of the
contingencies set forth in this Warrant. Each share of Common Stock as to which
this Warrant is exercisable is a "Warrant Share" and all such shares are
collectively referred to as the "Warrant Shares." Capitalized terms used in this
Warrant but not otherwise defined herein shall have the meanings assigned to
such terms in the Securities Purchase Agreement.
SECTION 1. EXERCISE OF WARRANT; CONVERSION OF WARRANT.
(a) This Warrant may, at the option of the Holder, be exercised in
whole or in part from time to time by delivery to the Company at its office at
0000 Xxxxxx Xxxxxx, Xxxxxxxx Xxxxxx, Xxxxxxxxxx 00000 Attention: President, on
or before 5:00 p.m., Eastern Time, on the Expiration Date, (i) a written notice
of such registered Holder's election to exercise this Warrant (the "Exercise
Notice"), which notice may be in the form of the Notice of Exercise attached
hereto, properly executed and completed by the registered Holder or an
authorized officer thereof, (ii) a check
payable to the order of the Corporation, in an amount equal to the product of
the Exercise Price multiplied by the number of Warrant Shares specified in the
Exercise Notice, and (iii) this Warrant (the items specified in (i), (ii), and
(iii) are collectively the "Exercise Materials").
(b) This Warrant may, at the option of the Holder, be converted
into Common Stock in whole but not in part, if and only if the Average Market
Price of one share of Common Stock on the Effective Date (as defined in Section
1(c) hereof) is greater than the Exercise Price, by delivery to the Company at
the address designated in Section 1(a) above or to any transfer agent for the
Common Stock, on or before 5:00 p.m. Eastern Time on the Expiration Date, (i) a
written notice of Holder's election to convert this Warrant (the "Conversion
Notice"), properly executed and completed by the registered Holder or an
authorized officer thereof, and (ii) this Warrant (the items specified in (i)
and (ii) are collectively the "Conversion Materials"). The number of shares of
Common Stock issuable upon conversion of this Warrant is equal to the quotient
of (x) the product of the number of Warrant Shares then issuable upon exercise
of this Warrant (assuming an exercise for cash) multiplied by the difference
between (A) the Average Market Price on the Effective Date (as such term is
defined in Section 1(c) hereof) minus (B) the then effective Exercise Price
divided by (y) the Average Market Price on the Effective Date. As used herein,
"Average Market Price" on any particular date means the arithmetic mean of the
Closing Bid Prices (as defined below) for the Common Stock for each trading day
in the five (5) trading day period ending on the trading day immediately
preceding the date on which the calculation is to be made. As used herein,
"Closing Bid Price" means, the last closing bid price of the Common Stock during
regular trading hours on the OTC Bulletin Board (the "OTCBB") as reported by
Bloomberg Financial Markets ("Bloomberg"), or, if the OTCBB is not the principal
trading market for the Common Stock, the last closing bid price during regular
trading hours of the Common Stock on the principal securities exchange or
trading market where the Common Stock is listed or traded as reported by
Bloomberg, or if the foregoing do not apply, the last closing bid price of the
Common Stock in the over-the-counter market on the pink sheets or bulletin board
for the Common Stock as reported by Bloomberg, or, if no closing bid price is
reported for the Common Stock by Bloomberg, the last closing trade price of the
Common Stock as reported by Bloomberg. If the Closing Bid Price cannot be
calculated for the Common Stock on such date on any of the foregoing bases, the
Closing Bid Price of the Common Stock on such date shall be the fair market
value as reasonably determined in good faith by the Board of Directors of the
Company (all as appropriately adjusted for any stock dividend, stock split, or
other similar transaction during such period).
(c) As promptly as practicable, and in any event within two (2)
business days after its receipt of the Exercise Materials or the Conversion
Materials, Company shall execute or cause to be executed and delivered to Holder
a certificate or certificates representing the number of Repricing Shares
specified in the Exercise Notice or Conversion Notice, together with cash in
lieu of any fraction of a share, and if this Warrant is partially exercised, a
new warrant on the same terms for the unexercised balance of the Warrant Shares.
The stock certificate or certificates shall be registered in the name of Holder
or such other name or names as shall be designated in the Exercise Notice. The
date on which the Warrant shall be deemed to have been exercised (the "Effective
Date"), and the date the person in whose name any certificate evidencing the
Common Stock issued upon the exercise hereof is issued shall be deemed to have
become the holder of record of such shares, shall be the date the Corporation
receives the Exercise Materials or Conversion Materials, irrespective of the
date of delivery of a certificate or certificates evidencing the Common Stock
issued upon the exercise or conversion hereof, provided, however, that if the
Exercise Materials or Conversion Materials are received by the Company on a date
on which the stock transfer books of the Company are closed, the Effective Date
shall be the next succeeding date on which the stock transfer books are open.
All
shares of Common Stock issued upon the exercise or conversion of this Warrant
will, upon issuance, be fully paid and nonassessable and free from all taxes,
liens, and charges with respect thereto.
(d) If the Company shall fail to issue to Holder within five (5)
business days following the date of receipt by the Company of the Exercise
Materials or Conversion Materials, a certificate for the number of shares of
Common Stock to which Holder is entitled upon exercise of this Warrant, in
addition to all other available remedies which such holder may pursue at law or
in equity, including without limitation the rights to indemnification pursuant
to Section 7.18 of the Series 1 Bridge Note Purchase and Security Agreement
between the Company and the initial holder of the Warrant (the "Securities
Purchase Agreement"), the Company shall pay additional damages to Holder on each
day after the Effective Date until such certificate for the Repricing Shares is
received by Holder, an amount equal to 1.0% of the product of (A) the number of
Repricing Shares not issued to Holder and to which Holder is entitled multiplied
by (B) the Closing Bid Price of the Common Stock on the Effective Date. Such
damages shall be computed and due and payable daily.
SECTION 2. ADJUSTMENTS TO WARRANT SHARES. The number of Warrant Shares
issuable upon the exercise hereof shall be subject to adjustment as follows:
(a) In the event the Company is a party to a consolidation, share
exchange, or merger, or the sale of all or substantially all of the assets of
the Company to, any person, or in the case of any consolidation or merger of
another corporation into the Company in which the Company is the surviving
corporation, and in which there is a reclassification or change of the shares of
Common Stock of the Company, this Warrant shall after such consolidation, share
exchange, merger, or sale be exercisable for the kind and number of securities
or amount and kind of property of the Company or the corporation or other entity
resulting from such share exchange, merger, or consolidation, or to which such
sale shall be made, as the case may be (the "Successor Company"), to which a
holder of the number of shares of Common Stock deliverable upon the exercise
(immediately prior to the time of such consolidation, share exchange, merger, or
sale) of this Warrant would have been entitled upon such consolidation, share
exchange, merger, or sale; and in any such case appropriate adjustments shall be
made in the application of the provisions set forth herein with respect to the
rights and interests of the registered Holder of this Warrant, such that the
provisions set forth herein shall thereafter correspondingly be made applicable,
as nearly as may reasonably be, in relation to the number and kind of securities
or the type and amount of property thereafter deliverable upon the exercise of
this Warrant. The above provisions shall similarly apply to successive
consolidations, share exchanges, mergers, and sales. Any adjustment required by
this Section 2 (a) because of a consolidation, share exchange, merger, or sale
shall be set forth in an undertaking delivered to the registered Holder of this
Warrant and executed by the Successor Company which provides that the Holder of
this Warrant shall have the right to exercise this Warrant for the kind and
number of securities or amount and kind of property of the Successor Company or
to which the holder of a number of shares of Common Stock deliverable upon
exercise (immediately prior to the time of such consolidation, share exchange,
merger, or sale) of this Warrant would have been entitled upon such
consolidation, share exchange, merger, or sale. Such undertaking shall also
provide for future adjustments to the number of Warrant Shares and the Exercise
Price in accordance with the provisions set forth in Section 2 hereof.
(b) In the event the Company should at any time, or from time to
time after the Original Issue Date, fix a record date for the effectuation of a
stock split or subdivision of the outstanding shares of Common Stock or the
determination of holders of Common Stock entitled to receive a dividend or other
distribution payable in additional shares of Common Stock, or securities or
rights
convertible into, or entitling the holder thereof to receive directly or
indirectly, additional shares of Common Stock (hereinafter referred to as
"Common Stock Equivalents") without payment of any consideration by such holder
for the additional shares of Common Stock or the Common Stock Equivalents
(including the additional shares of Common Stock issuable upon exercise or
exercise thereof), then, as of such record date (or the date of such dividend,
distribution, split, or subdivision if no record date is fixed), the number of
Warrant Shares issuable upon the exercise hereof shall be proportionately
increased and the Exercise Price shall be appropriately decreased by the same
proportion as the increase in the number of outstanding Common Stock Equivalents
of the Company resulting from the dividend, distribution, split, or subdivision.
Notwithstanding the preceding sentence, no adjustment shall be made to decrease
the Exercise Price below $.001 per Share.
(c) In the event the Company should at any time or from time to
time after the Original Issue Date, fix a record date for the effectuation of a
reverse stock split, or a transaction having a similar effect on the number of
outstanding shares of Common Stock of the Company, then, as of such record date
(or the date of such reverse stock split or similar transaction if no record
date is fixed), the number of Warrant Shares issuable upon the exercise hereof
shall be proportionately decreased and the Exercise Price shall be appropriately
increased by the same proportion as the decrease of the number of outstanding
Common Stock Equivalents resulting from the reverse stock split or similar
transaction.
(d) In the event the Company should at any time or from time to
time after the Original Issue Date, fix a record date for a reclassification of
its Common Stock, then, as of such record date (or the date of the
reclassification if no record date is set), this Warrant shall thereafter be
convertible into such number and kind of securities as would have been issuable
as the result of such reclassification to a holder of a number of shares of
Common Stock equal to the number of Warrant Shares issuable upon exercise of
this Warrant immediately prior to such reclassification, and the Exercise Price
shall be unchanged.
(e) The Company will not, by amendment of its Certificate of
Incorporation or through reorganization, consolidation, merger, dissolution,
issue, or sale of securities, sale of assets or any other voluntary action, void
or seek to avoid the observance or performance of any of the terms of the
Warrant, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such actions as may be necessary or
appropriate in order to protect the rights of the Holder against dilution or
other impairment. Without limiting the generality of the foregoing, the Company
(x) will not create a par value of any share of stock receivable upon the
exercise of the Warrant above the amount payable therefor upon such exercise,
and (y) will take all such action as may be necessary or appropriate in order
that the Company may validly and legally issue fully paid and non-assessable
shares upon the exercise of the Warrant.
(f) When any adjustment is required to be made in the number or
kind of shares purchasable upon exercise of the Warrant, or in the Exercise
Price, the Company shall promptly notify the Holder of such event and of the
number of shares of Common Stock or other securities or property thereafter
purchasable upon exercise of the Warrants and of the Exercise Price, together
with the computation resulting in such adjustment.
(g) The Company covenants and agrees that all Warrant Shares which
may be issued will, upon issuance, be validly issued, fully paid, and
non-assessable. The Company further covenants and agrees that the Company will
at all times have authorized and reserved, free from preemptive rights, a
sufficient number of shares of its Common Stock to provide for the exercise of
the Warrant in full.
SECTION 3. NO STOCKHOLDER RIGHTS. This Warrant shall not entitle the
Holder hereof to any voting rights or other rights as a stockholder of the
Company.
SECTION 4. TRANSFER OF SECURITIES.
(a) This Warrant and the Warrant Shares and any shares of capital
stock received in respect thereof, whether by reason of a stock split or share
reclassification thereof, a stock dividend thereon, or otherwise, shall not be
transferable except upon compliance with the provisions of the Securities Act of
1933, as amended (the "Securities Act") and applicable state securities laws
with respect to the transfer of such securities. The Holder of this Warrant, by
acceptance of this Warrant, agrees to be bound by the provisions of Section 4
hereof and to indemnify and hold harmless the Company against any loss or
liability arising from the disposition of this Warrant or the Warrant Shares
issuable upon exercise hereof or any interest in either thereof in violation of
the provisions of this Warrant.
(b) Each certificate for the Warrant Shares and any shares of
capital stock received in respect thereof, whether by reason of a stock split or
share reclassification thereof, a stock dividend thereon or otherwise, and each
certificate for any such securities issued to subsequent transferees of any such
certificate shall (unless otherwise permitted by the provisions hereof) be
stamped or otherwise imprinted with a legend in substantially the following
form:
"NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE
UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES
LAW AND NEITHER MAY BE SOLD OR OTHERWISE TRANSFERRED UNTIL (I)
A REGISTRATION STATEMENT UNDER SUCH SECURITIES ACT AND SUCH
APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME EFFECTIVE
WITH REGARD THERETO, OR (II) THE COMPANY SHALL HAVE RECEIVED A
WRITTEN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY TO THE
EFFECT THAT REGISTRATION UNDER SUCH SECURITIES ACT AND SUCH
APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED IN CONNECTION
WITH SUCH PROPOSED TRANSFER."
SECTION 5. REGISTRATION.
The holder of this warrant shall be entitled to all the rights and
privileges granted in and under Section 2(c) of the Registration Rights
Agreement dated March 27, 2000 as if the Warrant Shares were Registrable
Securities (as such term is defined in such Registration Rights Agreement).
SECTION 6. MISCELLANEOUS.
(a) The terms of this Warrant shall be binding upon and shall
inure to the benefit of any permitted successors or assigns of the Company and
of the Holder.
(b) Except as otherwise provided herein, this Warrant and all
rights hereunder are transferable by the registered holder hereof in person or
by duly authorized attorney on the books of
the Company upon surrender of this Warrant, properly endorsed, to the Company.
The Company may deem and treat the registered holder of this Warrant at any time
as the absolute owner hereof for all purposes and shall not be affected by any
notice to the contrary.
(c) Notwithstanding any provision herein to the contrary, Holder
may not exercise, sell, transfer, or otherwise assign this Warrant unless the
Company is provided with an opinion of counsel satisfactory in form and
substance to the Company, to the effect that such exercise, sale, transfer, or
assignment would not violate the Securities Act or applicable state securities
laws.
(d) This Warrant may be divided into separate warrants covering
one share of Common Stock or any whole multiple thereof, for the total number of
shares of Common Stock then subject to this Warrant at any time, or from time to
time, upon the request of the registered holder of this Warrant and the
surrender of the same to the Company for such purpose. Such subdivided Warrants
shall be issued promptly by the Company following any such request and shall be
of the same form and tenor as this Warrant, except for any requested change in
the name of the registered holder stated herein.
(e) Any notices, consents, waivers, or other communications
required or permitted to be given under the terms of this Warrant must be in
writing and will be deemed to have been delivered (a) upon receipt, when
delivered personally, (b) upon receipt, when sent by facsimile, provided a copy
is mailed by U.S. certified mail, return receipt requested, (c) three (3) days
after being sent by U.S. certified mail, return receipt requested, or (d) one
(1) day after deposit with a nationally recognized overnight delivery service,
in each case properly addressed to the party to receive the same. The addresses
and facsimile numbers for such communications shall be:
If to the Company: Providential Holdings, Inc.
0000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Facsimile: (000) 000-0000
If to Holder, to the registered address of Holder appearing on the books of the
Company. Each party shall provide five (5) days prior written notice to the
other party of any change in address, which change shall not be effective until
actual receipt thereof
(f) The corporate laws of the State of Nevada shall govern all
issues concerning the relative rights of the Company and its stockholders. All
other questions concerning the construction, validity, enforcement and
interpretation of this Warrant shall be governed by the internal laws of the
State of New York, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of New York or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the
State of New York. Each party hereby irrevocably submits to the non-exclusive
jurisdiction of the state and federal courts sitting the City of New York,
borough of Manhattan, for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such notices to it under
this Warrant and
agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing contained herein shall be deemed to limit in any way
any right to serve process in any manner permitted by law. 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 in that jurisdiction or the validity or
enforceability of any provision of this Warrant in any other jurisdiction.
SIGNATURE PAGE
TO
COMPANY
COMMON STOCK PURCHASE WARRANT
IN WITNESS WHEREOF, the Company, has caused this Warrant to be executed
in its name by its duly authorized officers under seal, and to be dated as of
the date first above written.
PROVIDENTIAL HOLDINGS, INC.
By: _____________________________________
Name:
Title:
ATTEST:
__________________________________
Secretary/Assistant Secretary
[CORPORATE SEAL]
ASSIGNMENT
(To be Executed by the Registered Holder to effect a Transfer of the foregoing
Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, and assigns and
transfers unto ___________________________________________________________ the
foregoing Warrant and the rights represented thereto to purchase shares of
Common Stock of PROVIDENTIAL HOLDINGS, INC. in accordance with terms and
conditions thereof, and does hereby irrevocably constitute and appoint
________________ Attorney to transfer the said Warrant on the books of the
Company, with full power of substitution.
Holder:
_______________________________
_______________________________
Address
Dated: __________________, 19__
In the presence of:
_______________________________
FORM OF NOTICE OF EXERCISE OR CONVERSION
[To be signed only upon exercise of Warrant]
To: PROVIDENTIAL HOLDINGS, INC.
The undersigned registered Holder of the attached Warrant hereby
irrevocably elects to exercise the Warrant for, and to purchase thereunder,
________ shares of Common Stock of PROVIDENTIAL HOLDINGS, INC., issuable upon
exercise of said Warrant and hereby surrenders said Warrant.
Choose One:
The Holder herewith delivers to PROVIDENTIAL HOLDINGS, INC., a
check in the amount of $______ representing the Exercise Price
for such shares.
or
The Holder elects a cashless exercise pursuant to Section 2(b)
of the Warrant. The Average Market Price as of _______ was
$_____.
The undersigned herewith requests that the certificates for such shares be
issued in the name of, and delivered to the undersigned, whose address is
________________________________.
Dated: ___________________
Holder:
____________________________________
____________________________________
By:_________________________________
____________________
NOTICE
The signature above must correspond to the name as written upon the face of the
within Warrant in every particular, without alteration or enlargement or any
change whatsoever.