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Exhibit 4.2
PROGRESSIVE TELECOMMUNICATIONS CORPORATION
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE
UPON THE EXERCISE OF THIS WARRANT ARE TRANSFERABLE
ONLY IN ACCORDANCE WITH PARAGRAPH H HEREOF.
Void after 5:00 P.M., New York Time, on December 31, 2002
Warrant to Purchase
__________ Shares
of Common Stock
WARRANT TO PURCHASE COMMON STOCK
This is to Certify That, FOR VALUE RECEIVED, __________________________________,
a____________________________________________________________, having an office
at ________________________________________________________________________(the
"Holder") is entitled to purchase, subject to the provisions of this Warrant,
from Progressive Telecommunications Corporation, a company organized under the
laws of the State of Nevada, having an office at 000 Xxxxxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxxxx, Xxxxxxx 00000 (the "Company"), the number of shares set forth
above (the "Warrant Shares") of the Company's Common Stock, $.001 par value
("Common Stock") at a price of $1.50 per share (or such other price computed by
applying all adjustments made on or before December 31, 2002, in accordance
with Section F hereof, to $1.50 as if it had been the initial Exercise Price
per share hereunder) at any time on or after December 31, 1999 until 5:00 P.M.
New York Time, on December 31, 2002. The number of shares of Common Stock to be
received upon the exercise of this Warrant and the price to be paid for a share
of Common Stock may be adjusted from time to time as hereinafter set forth. The
shares of Common Stock deliverable upon such exercise, and as adjusted from
time to time, are hereinafter sometimes referred to as "Warrant Shares" and the
exercise price of a share of Common Stock in effect at any time and as adjusted
from time to time is hereinafter sometimes referred to as the "Exercise Price."
The Warrants represented by the Certificate are part of an authorized class of
2,000,000 Warrants.
A. EXERCISE OF WARRANT. Subject to the following conditions precedent and the
provisions of Section H hereof, this Warrant may be exercised in whole or in
part at any time or from time to time on or after December 31, 1999, and
before 5:00 P.M. New York Time on December 31, 2002, or, if either such day
is a day on which banking institutions are authorized by law to close, then
on the next succeeding day which shall not be such a day, by presentation
and surrender hereof to the Company at any office maintained by it in
Clearwater, Florida, or at the office of its Warrant Agent, if any, with
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the Purchase Form annexed hereto duly executed and accompanied by payment of
the Exercise Price for the number of shares specified in such form. If this
Warrant should be exercised in part only, the Company shall, upon surrender
of this Warrant for cancellation, execute and deliver a new Warrant
evidencing the rights of the Holder hereof to purchase the balance of the
shares purchasable hereunder. Upon receipt by the Company of this Warrant at
its office, or by the Warrant Agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of
the shares of Common Stock issuable upon such exercise, notwithstanding that
the stock transfer books of the Company shall then be closed or that
certificate representing such shares of Common Stock shall not then be
actually delivered to the Holder.
B. RESERVATION OF SHARES. The Company hereby agrees that at all times there
shall be reserved for issuance and/or delivery upon exercise of this Warrant
such number of shares of its Common Stock as shall be required for issuance
of delivery upon exercise of this Warrant.
C. FRACTIONAL SHARES. No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant. With respect to
any fraction of a share called for upon exercise hereof, the Company shall
issue to the Holder the next whole share.
D. EXCHANGE, ASSIGNMENT OR LOSS OF WARRANT. This Warrant is exchangeable,
without expense, at the option of the Holder, upon presentation and
surrender hereof to the Company or at the office of the Warrant Agent for
other Warrants of different denominations entitling the holder thereof to
purchase in aggregate the same number of shares of Common Stock purchasable
hereunder. The term Warrant as used herein includes any Warrants into which
this Warrant may be divided or exchanged. Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction, or
mutilation of this Warrant, and (in the case of loss, theft or destruction)
of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and
deliver a new Warrant of like tenor and date. Any such new warrant executed
and delivered shall constitute an additional contractual obligation on the
part of the Company, whether or not this Warrant so lost stolen, destroyed,
or mutilated shall be at any time enforceable by anyone.
E. RIGHTS OF THE HOLDER. The Holder shall not, by virtue here of, be entitled
to any rights of a shareholder in the Company, either at law or equity, and
the rights of the Holder are limited to those expressed in the Warrant and
are not enforceable against the Company except to the extent set forth
herein.
F. STOCK DIVIDENDS, RECLASSIFICATION, REORGANIZATION, ANTI-DILUTION PROVISIONS,
ETC. This Warrant is subject to the following further provisions:
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1. In case, prior to the expiration of this Warrant by exercise or by its
terms, the Company shall issue any shares of its Common Stock as a stock
dividend or subdivide the number of outstanding shares of Common Stock
into a greater number of shares, then, in either of such cases, the
Exercise Price per share of the Warrant Shares purchasable pursuant to
this Warrant in effect at the time of such action shall be
proportionately reduced and the number of Warrant Shares at that time
purchasable pursuant to this Warrant shall be proportionately increased;
and conversely, in the event the Company shall contract the number of
outstanding shares of Common Stock by combining such shares into a
smaller number of shares, then, in such case, the Exercise Price per
share of the Warrant Shares purchasable pursuant to this Warrant in
effect at the time of such action shall be proportionately increased and
the number of Warrant Shares at that time purchasable pursuant to this
Warrant shall be proportionately decreased. Provided however, the maximum
Exercise Price shall not exceed $15.00 and the corresponding minimum
number of Warrant Shares issuable upon exercise hereof shall equal the
number determined by multiplying the initial number of Warrant Shares
which could be obtained upon exercise by $1.50 and dividing the product
so obtained by $15.00. Any dividend paid or distributed upon the Common
Stock in stock of any other class of securities convertible into shares
of Common Stock shall be treated as a dividend paid in Common Stock to
the extent that shares of Common Stock are issuable upon the conversion
thereof.
2. In case, prior to the expiration of this Warrant by exercise or by its
terms, the Company shall be recapitalized by reclassifying its
outstanding Common Stock, $.001 par value, into stock with a different
par value or by changing its outstanding Common Stock with par value to
stock without par, the Company or a successor corporation shall be
consolidated or merge with or convey all or substantially all of its or
of any successor corporation's property and assets to any other
corporation or corporations (any such corporation being included within
the meaning of the term successor corporation in the event of any
consolidation or merger of any such corporation with, or the sale of all
or substantially all of the property of any such corporation to, another
corporation or corporations), in exchange for stock or securities of a
successor corporation, the holder of this Warrant shall thereafter have
the right to purchase upon the terms and conditions and during the time
specified in this Warrant, in lieu of the Warrant Shares theretofore
purchasable upon the exercise of this Warrant, the kind and amount of
shares of stock and other securities receivable upon such
recapitalization or consolidation, merger or conveyance by a holder of
the number of shares of Common Stock which the holder of this Warrant
might have purchased immediately prior to such recapitalization or
consolidation, merger or conveyance.
3. Upon the occurrence of each event requiring an adjustment of the Exercise
Price and of the number of Warrant Shares purchasable at such adjusted
Exercise Price by reason of such event in accordance with the provisions
of this Section F, the
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Company shall compute the adjusted Exercise Price and the adjusted number
of Warrant Shares purchasable at such adjusted Exercise Price by reason
of such event in accordance with the provisions of this Section F and
shall prepare a certificate setting forth such adjusted Exercise Price
and the adjusted number of Warrant Shares and showing in detail the facts
upon which such conclusions are based. The Company shall mail forthwith
to each holder of this Warrant a copy of such certificate, and thereafter
said certificate shall be conclusive and shall be binding upon such
holder unless contested by such holder by written notice to the Company
within thirty (30) days after receipt of the certificate by such holder.
4. In case:
(a) the Company shall take a record of the holders of its Common Stock
for the purpose of entitling them to receive a dividend or any other
distribution in respect of the Common Stock (including cash),
pursuant to without limitation, any spin-off, split-off or
distribution of the Company's assets; or
(b) the Company shall take a record of the holders of its Common Stock
for the purpose of entitling them to subscribe for or purchase any
shares of stock of any class or to receive any other rights; or
(c) of any classification, reclassification or other reorganization of
the capital stock of the Company, consolidation or merger of the
Company with or into another corporation, or conveyance of all or
substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or winding
up of the Company;
then, and in any such case, the Company shall mail to the Holder, at
least twenty (20) days prior thereto, a notice stating the date or
expected date on which a record is to be taken for the purpose of such
dividend or distribution of rights, or the date on which such
classification, reclassification, reorganization, consolidation, merger,
conveyance, dissolution, liquidation, or winding up is to take place, as
the case may be. Such notice shall also specify the date or expected
date, if any is to be fixed, as of which holders of Common Stock of
record shall be entitled to participate in said dividend or distribution
of rights, or shall be entitled to exchange their shares of Common stock
for securities or other property deliverable upon such classification,
reclassification, reorganization, consolidation, merger, conveyance,
dissolution, liquidation, or winding up, as the case may be. The failure
to give such notice shall not affect the validity of any such proceeding
or transaction and shall not affect the right of the holder of this
Warrant to participate in said dividend, distribution of rights, or any
such exchange and acquire the kind and amount of cash, securities or
other property as
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the Holder would have been entitled to acquire if it was the record
holder of the Warrant Shares which could be obtained upon the exercise of
the Warrants immediately before such proceeding or transaction; provided
that, the Holder exercises the Warrants within 30 days after discovery
that such action or proceeding has taken place.
5. In case the Company at any time while this Warrant shall remain unexpired
and unexercised, shall dissolve, liquidate, or wind up its affairs, the
holder of this Warrant may thereafter receive upon exercise hereof in
lieu of each share of Common Stock of the Company which it would have
been entitled to receive, the same kind and amount of any securities or
assets as may be issuable, distributable or payable upon any such
dissolution, liquidation or winding up with respect to each share of
Common Stock of the Company.
G. OFFICER'S CERTIFICATE. Whenever the Exercise Price shall be adjusted as
required by the provisions of the foregoing Section, the Company shall
forthwith file in the custody of its Secretary at its principal office and
with the Warrant Agent, if any, an officer's certificate showing the
adjusted Exercise Price determined as therein provided, setting forth in
reasonable detail the facts requiring such adjustment, including a statement
of the number of additional shares of Common Stock, if any, the
consideration for such shares, determined as provided in such Section F, and
such other facts as shall be necessary to show the reason for and the manner
of computing such adjustment. Each such officer's certificate shall be made
available at all reasonable times for inspection by the holder and the
Company shall, forthwith after each such adjustment, mail a copy of such
certificate to the holder.
H. TRANSFER TO COMPLY WITH THE SECURITIES ACT OF 1933. Neither this Warrant,
the Warrant Shares, nor any other security issued or issuable upon exercise
of this Warrant may be sold or otherwise disposed or except as follows:
1. to a person who, in the opinion of counsel reasonably satisfactory to the
Company, is a person to whom the Warrant or Warrant Shares may legally be
transferred without registration and without the delivery of a current
prospectus under the Securities Act of 1933, as amended (the "Act") with
respect thereto and then only against receipt of an agreement of such
person to comply with the provisions of this Section H with respect to
any resale or other disposition of such securities; or
2. to any person upon delivery of a prospectus then meeting the requirements
of the Act relating to such securities and the offering thereof for such
sale or disposition.
I. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to the holder as follows:
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1. The Company is duly organized and, as of the date of the original
issuance hereof, validly existing and in good standing under the laws of
the State of Nevada.
2. The Company shall at all times reserve and keep available out of its
authorized shares of Common Stock, solely for the purpose of issuing
Warrant Shares upon the exercise of this Warrant, such shares as may be
issuable upon the exercise hereof.
3. Warrant Shares, when issued and paid for in accordance with the terms of
this Warrant, will be fully paid and not assessable.
4. This Warrant has been duly authorized and approved by all required
corporate action by the Company and does not violate the certificate of
incorporation or by-laws of the Company.
J. REGISTRATION RIGHTS: LIQUIDATED DAMAGES. The Holder will be entitled to
registration rights in respect of the shares of Common Stock issuable upon
conversion of the Debentures and exercise of the Warrants (the terms of
which are set forth below) as follows: (1) The Company shall prepare and
file, within 90 days of the initial Closing Date, Registration Statement on
Form S-3 or such other applicable Registration Statement (the "Registration
Statement") with the Securities and Exchange Commission (the "Commission")
covering the resale of the shares of Common Stock issuable upon the exercise
of the Warrants. The Company shall use its best efforts to cause the
Registration Statement to be declared effective by the Commission no later
than 150 days following the initial Closing Date and shall promptly deliver
to Purchaser copies of all amendments to such Registration Statement and
correspondence with the Commission with respect thereto. The Company shall
maintain the effectiveness of the Registration Statement until all of the
Common Stock issuable or issued upon conversion or exercise of the Warrants
has been sold. The Company shall pay all expenses of registration (other
than underwriting fees and discounts in respect of shares of Common Stock
offered and sold under such Registration Statement by the Purchaser, if
any). (2) If the Registration Statement is not declared effect by the
Commission during the 150 day period mentioned above, the Company shall pay
promptly in cash or free trading common stock valued at the Conversion
Price, as hereinafter defined, to the Holder, as liquidated damages and not
as a penalty, an amount equal to one percent (1%) per month commencing 150
and ending 180 days after the initial Closing of the outstanding principal
amount of the Debentures, in the event that the Registration Statement is
not declared effective by the Commission by the 180th day, liquidated
damages shall be increased to two percent (2%) per month from 180 days after
the Closing date until the Registration Statement is declared effective.
[SIGNATURE PAGE FOLLOWS]
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PROGRESSIVE TELECOMMUNICATIONS
CORPORATION
[CORPORATE SEAL]
By:
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Xxxxx X. Xxxxxxx, CEO
Dated:
ATTEST:
______________________________
, Secretary
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PURCHASE FORM
TO BE EXECUTED
UPON EXERCISE OF WARRANTS
TO: Progressive Telecommunications Corporation
000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
The undersigned hereby exercises, according to the terms and
conditions thereof, the right to purchase _____________ Shares of Common Stock,
evidenced by the within Warrant Certificate, and herewith makes payment of the
purchase price in full.
Dated:_____________________________
Name:______________________________
Address:___________________________
Signature:_________________________
UPON EXERCISE OF THIS WARRANT PAYMENT SHOULD BE MADE TO THE ORDER OF
PROGRESSIVE TELECOMMUNICATIONS CORPORATION.
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