Exhibit 4.18
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT") NOR UNDER ANY
STATE SECURITIES LAW AND MAY NOT BE PLEDGED, SOLD, ASSIGNED OR OTHERWISE
TRANSFERRED UNTIL A (1) REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS HAS BECOME EFFECTIVE WITH RESPECT THERETO, OR
(2) RECEIPT BY THE COMPANY OF AN OPINION OF COUNSEL TO THE COMPANY TO THE EFFECT
THAT REGISTRATION UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS
IS NOT REQUIRED IN CONNECTION WITH THE PROPOSED TRANSFER.
THIS WARRANT MAY NOT BE EXERCISED EXCEPT IN COMPLIANCE WITH ALL APPLICABLE
FEDERAL AND STATE SECURITIES LAWS TO THE REASONABLE SATISFACTION OF THE COMPANY
AND LEGAL COUNSEL FOR THE COMPANY.
Void after 5:00 p.m. New York City Time, on Xxxxx 0, 0000
Xxxxxxx to Purchase 25,000 Shares of Common Stock
WARRANT TO PURCHASE COMMON STOCK, PAR VALUE $0.01,
OF
XXXXXX.XXX, INC.
This is to Certify That, FOR VALUE RECEIVED, Xxxxx Xxxxxx or his
permitted assigns ("Holder"), is entitled to purchase, subject to the provisions
of this Warrant, from Xxxxxx.xxx, Inc., a Delaware corporation (the "Company"),
25,000 fully paid, validly issued and nonassessable shares of Common Stock, par
value $.01 per share, of the Company ("Common Stock") at a price of $3.00 per
share at any time or from time to time during the period from April 1, 2000 to
April 1, 2005, as set forth under (a) below, but not later than 5:00 p.m. New
York City Time, on April 1, 2005. The number of shares of Common Stock to be
received upon the exercise of this Warrant and the price to be paid for each
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."
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part at any time or
from time to time, until April 1, 2005. This Warrant may be exercised by
presentation and surrender hereof to the Company at its principal office, or at
the office of its stock transfer agent, if any, with the Purchase Form annexed
hereto as Exhibit A duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form and any and all
transfer taxes applicable to such exercise. As soon as practicable after each
such exercise, but not later than thirty (30) days from the date of such
exercise, the Company shall issue and deliver to the Holder a certificate or
certificate for the Warrant Shares issuable upon such exercise, registered in
the name of the Holder or its designee. 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 thereof to
purchase the balance of the Warrant Shares purchasable thereunder.
(2) At any time during the term of this Warrant, the Holder may, at its
option, exchange this Warrant, in whole or in part (a "Warrant Exchange"), into
the number of Warrant Shares determined in accordance with this Section (a)(2),
by surrendering this Warrant at the principal office of the Company or at the
office of its stock
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transfer agent, accompanied by a notice stating Holder's intent to exchange, the
number of Warrant Shares to be exchanged and the date on which the Holder
requests that such Warrant Exchange occur (the "Notice of Exchange"). The
Warrant Exchange shall take place on the date specified in the Notice of
Exchange or, if later, the date the Notice of Exchange is received by the
Company (the "Exchange Date"). Certificates for the Common Stock issuable upon
such Warrant Exchange and, if applicable, a new warrant of like tenor evidencing
the balance of the Common Stock remaining subject to this Warrant, shall be
issued as of the Exchange Date and delivered to the Holder within thirty (30)
days following the Exchange Date.
In connection with any Warrant Exchange, this Warrant shall represent
the right to subscribe for and acquire the number of Warrant Shares (rounded to
the next highest integer) equal to (i) the number of Warrant Shares specified by
the Holder in its Notice of Exchange (the "Total Number") less (ii) the number
of Warrant Shares equal to the quotient obtained by dividing (A) the product of
the Total Number and the existing Exercise Price plus any and all transfer taxes
applicable to such exercise, by (B) the Current Market Value of a share of
Common Stock. Current Market Value shall have the meaning set forth Section (c)
below, except that for purposes hereof, the date of exercise, as used in such
Section (c), shall mean the Exchange Date.
(b) RESERVATION OF SHARES. The Company shall at all times reserve for
issuance and/or delivery upon exercise of this Warrant such number of shares of
its Common Stock as shall be required for issuance and delivery upon exercise of
the Warrant.
(c) FRACTIONAL SHARES. No fractional shares or script representing
fractional shares shall be issued upon the exercise of this Warrant. With
respect to any fraction of a share called for upon any exercise hereof, the
Company shall pay to the Holder an amount in cash equal to such fraction
multiplied by the Current Market Value of a share, determined as follows:
(1) If the Common Stock is listed on a national securities exchange or
admitted to unlisted trading privileges on such exchange or listed for
trading on the Nasdaq National Market, the Current Market Value shall
be the last reported sale price of the Common Stock on such exchange or
market on the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average closing bid
and asked prices for such day on such exchange or market; or
(2) If the Common Stock is not so listed or admitted to unlisted
trading privileges, but is traded on the Nasdaq Small Cap Market, the
Current Market Value shall be the average of the closing bid and asked
prices for such day on such market and if the Common Stock is not so
traded, the Current Market Value shall be the mean of the last reported
bid and asked prices reported by the National Quotation Bureau, Inc. on
the last business day prior to the date of the exercise of this Warrant
if such prices are so reported; or
(3) If the Common Stock is not so listed or admitted to unlisted
trading privileges and bid and asked prices are not so reported, the
Current Market Value shall be an amount, not less than book value
thereof as at the end of the most recent fiscal year of the Company
ending prior to the date of the exercise of the Warrant, determined in
such reasonable manner as may be prescribed by the Board of Directors
of the Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT.
(i) 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 its stock transfer agent, if any, for other warrants of
different denominations entitling the holder thereof to purchase in the
aggregate the same number of shares of Common Stock purchasable
hereunder;
(ii) Neither this Warrant, nor the shares of Common Stock issued upon
the exercise of all or a portion of this Warrant, may be transferred
(other than by will or pursuant to the laws of descent and
distribution) except with the Company's prior written consent. Any
transfer of the Warrant, or the shares of Common
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Stock issued upon the exercise of the Warrant, must be done so in
compliance with applicable federal and state securities laws;
(iii) By acceptance of this Warrant, the Holder agrees to be bound by
the terms of a standard market standoff agreement requested by
underwriters with respect to a public offering of Common Stock acquired
pursuant to this Warrant;
(iv) Upon surrender of this Warrant to the Company at its principal
office or at the office of its stock transfer agent, if any, with the
Assignment Form annexed hereto duly executed and funds sufficient to
pay any transfer tax, and with the consent of the Company, the Company
shall, without charge, execute and deliver a new Warrant in the name of
the assignee named in such instrument of assignment and this Warrant
shall promptly be cancelled. This Warrant may be divided or combined
with other warrants which carry the same rights upon presentation
hereof at the principal office of the Company or at the office of its
stock transfer agent, if any, together with a written notice specifying
the names and denominations in which new Warrants are to be issued and
signed by the Holder hereof. The term "Warrant" as used herein includes
any Warrants into which this Warrant may be divided or exchanged.
(v) Upon receipt by the Company of evidence 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) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at any time
and the number and kind of securities purchasable upon the exercise of the
Warrant shall be subject to adjustment from time to time upon the happening of
certain events as follows:
(1) In case the Company shall
(i) declare a dividend or make a distribution on its outstanding
shares of Common Stock in shares of Common Stock,
(ii) subdivide or reclassify its outstanding shares of Common Stock
into a greater number of shares, or
(iii) combine or reclassify its outstanding shares of Common
Stock into a smaller number of shares,
the number of shares subject to the Warrant shall be proportionately
increased, and the exercise price of the Warrant shall be
proportionately decreased, in the case of actions specified in (l)(i)
or (ii) above; and the number of shares shall be proportionately
decreased, and the exercise price proportionately increased, in the
case of actions specified in (l)(iii) above. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise of each Warrant
is adjusted pursuant to Subsection (f)(1) above, the number of Shares
purchasable upon exercise of this Warrant shall simultaneously be
adjusted by multiplying the number of Shares initially issuable upon
exercise of this Warrant by the Exercise Price in effect on the date
hereof and dividing the product so obtained by the Exercise Price, as
adjusted.
(3) No adjustment in the Exercise Price shall be required unless such
adjustment would require an increase or decrease of at least five cents
($0.05) in such price; provided, however, that any adjustments which by
reason of this Subsection (3) are not required to be made shall be
carried forward and taken into
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account in any subsequent adjustment required to be made hereunder. All
calculations under this Section (f) shall be made to the nearest cent
or to the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding, the
Company shall be entitled, but shall not be required, to make such
changes in the Exercise Price, in addition to those required by this
Section (f), as it shall determine, in its sole discretion, to be
advisable in order that any dividend or distribution in shares of
Common Stock, or any subdivision, reclassification or combination of
Common Stock, hereafter made by the Company shall not result in any
Federal Income tax liability to the Holder.
(4) Whenever the Exercise Price is adjusted, as herein provided, the
Company shall promptly but no later than 20 days after any request for
such an adjustment by the Holder, cause a notice setting forth the
adjusted Exercise Price and adjusted number of Shares issuable upon
exercise of each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to the
Holder at his last addresses appearing in the records of the Company,
and shall cause a copy thereof to be mailed to its transfer agent, if
any. The Company may retain a firm of independent certified public
accountants selected by the Board of Directors (who may be the regular
accountants employed by the Company) to make any computation required
by this Section (f), and a certificate signed by such firm shall be
conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an adjustment made
pursuant to Subsection (1) above, the Holder of this Warrant thereafter
shall become entitled to receive any shares of the Company, other than
Common Stock, thereafter the number of such other shares so receivable
upon exercise of this Warrant shall be subject to adjustment from time
to time in a manner and on terms as nearly equivalent as practicable to
the provisions with respect to the Common Stock contained in Subsection
(1) above.
(6) Irrespective of any adjustments in the Exercise Price or the number
or kind of shares purchasable upon exercise of this Warrant, Warrants
theretofore or thereafter issued may continue to express the same price
and number and kind of shares as are stated in the Warrants previously
issued.
(f) OFFICER'S CERTIFICATE. Whenever the Exercise Price and number of
Common Shares shall be adjusted as required by the provisions of the foregoing
Section, the Company shall forthwith file in the custody of its Secretary or an
Assistant Secretary at its principal office and with its stock transfer agent,
if any, an officer's certificate showing the adjusted Exercise Price determined
as herein 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, 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 by
certified mail of such certificate to the Holder.
(g) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall be
outstanding, (i) if the Company shall pay any dividend or make any distribution
upon the Common Stock or (ii) if the Company shall offer to the holders of
Common Stock for subscription or purchase by them any share of any class or any
other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
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(h) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which the Company is the continuing corporation and which does not result in
any reclassification, capital reorganization or other change of outstanding
shares of Common Stock of the class issuable upon exercise of this Warrant) or
in case of any sale, lease or conveyance to another corporation of the property
of the Company as an entirety, the Company shall, as a condition precedent to
such transaction, cause effective provisions to be made so that the Holder shall
have the right thereafter by exercising this Warrant at any time prior to the
expiration of the Warrant, to purchase the kind and amount of shares of stock
and other securities and property receivable upon such reclassification, capital
reorganization and other change, consolidation, merger, sale or conveyance by a
holder of the number of shares of Common Stock which might have been purchased
upon exercise of this Warrant immediately prior to such reclassification,
change, consolidation, merger, sale or conveyance. Any such provision shall
include provision for adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Warrant.
The foregoing provisions of this Section (h) shall similarly apply to
successive reclassification, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof. A distribution in
securities, rights to acquire securities, or other property (except for cash
dividends) made with respect to Common Stock or other securities of the Company
or a successor corporation, to the extent that such distribution shall not be
covered by the provisions of Subsection (1) of Section (e) hereof, shall be
deemed to be a capital reorganization within the meaning of this Section (h).
(i) COMPLIANCE WITH SECURITIES ACT. The Holder, by acceptance hereof,
(a) represents (i) that this Warrant and the Common Stock to be issued
upon exercise of this Warrant are being acquired for investment only
and not with a view toward distribution or resale, and (ii) that he
will not offer, sell or otherwise dispose of this Warrant or any Common
Stock purchasable upon exercise of this Warrant except with the
permission of the Company and under circumstances which will not result
in a violation of the Securities Act;
(b) agrees that upon exercise of this Warrant, the Holder shall (i)
submit to the Company a signed copy of Exhibit B, (ii) provide such
additional information regarding such holder's financial and investment
background as the Company may reasonably request, and (iii) all Common
Stock Shares issued upon exercise of this Warrant (unless registered
under the Securities Act) shall be stamped or imprinted with a
restrictive legend substantially in the form of the following:
THESE SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") NOR UNDER ANY STATE SECURITIES
LAWS AND MAY NOT BE PLEDGED, SOLD, ASSIGNED OR OTHERWISE
TRANSFERRED UNTIL (1) A REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS HAS
BECOME EFFECTIVE WITH RESPECT THERETO, OR (2) RECEIPT BY THE
COMPANY OF AN OPINION OF COUNSEL TO THE COMPANY TO THE EFFECT
THAT REGISTRATION UNDER THE SECURITIES ACT OR APPLICABLE STATE
SECURITIES LAWS IS NOT REQUIRED IN CONNECTION WITH THE
PROPOSED TRANSFER.
(j) The Company will not, by amendment of its charter or through
reorganization, consolidation, merger, dissolution, sale of assets or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms of this Warrant, but will at all times in good faith assist in the
carrying out of all
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such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the holder of this
Warrant against impairment.
(k) The Holder, by acceptance hereof, agrees that:
(1) STOP-TRANSFER NOTICES. In order to ensure compliance with the
restrictions referred to herein, the Company may issue appropriate
"stop transfer" instructions to its transfer agent, if any, and, if the
Company transfers its own securities, it may make appropriate notations
to the same effect in its own records;
(2) REFUSAL TO TRANSFER. The Company shall not be required to (i)
transfer the Warrant on its books or transfer any securities that have
been sold or otherwise transferred in violation of any of the
provisions of this Warrant; or (ii) treat as the owner of the Warrant
or any such securities, or accord the right to vote or pay dividends
to, any purchaser or other transferee to whom such securities shall
have been so transferred;
(3) RIGHTS OF STOCKHOLDERS. No holder of the Warrant shall be entitled
to vote or receive dividends or be deemed the Holder, nor shall
anything contained herein be construed to confer upon the Holder, as
such, any of the rights of a stockholder of the Company or any right to
vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof, or to give or withhold consent to
any corporate action (whether upon any recapitalization, issuance of
stock, reclassification of stock, change of par value or change of
stock to no par value, consolidation, merger, conveyance, or otherwise)
or to receive notice of meetings, or to receive dividends, until the
Warrant shall have been exercised and the Common Stock shall have
become deliverable, as provided herein.
(l) GOVERNING LAW. The terms and conditions of this Warrant shall be
governed by and construed in accordance with the laws of the State of Delaware.
(m) MISCELLANEOUS. The headings in this Warrant are for purposes of
convenience and reference only, and shall not be deemed to constitute a part
hereof. Neither this Warrant nor any term hereof may be changed, waived,
discharged or terminated in any manner except by an instrument in writing signed
by the Company and the Holder.
All notices and other communications from the Company to the holder of
this Warrant shall be mailed by first-class registered or certified mail or
recognized commercial courier service, postage or delivery charges prepaid, to
the address furnished to the Company in writing by the last holder of this
Warrant who shall have furnished an address to the Company in writing.
XXXXXX.XXX, INC.
By: _____________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board
and Chief Executive Officer
[SEAL]
Dated: April _____, 2000
Attest:
-----------------------------
Xxxxxxx X. Xxxxxxx
Secretary
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Exhibit A
PURCHASE FORM
Dated ____________, 20_______
1. The undersigned hereby irrevocably elects to exercise the within Warrant to
the extent of purchasing _______ shares of Common Stock and hereby makes payment
of _____________ in payment of the actual exercise price thereof, together with
all applicable transfer taxes, if any.
2. Please issue a certificate or certificates representing said shares of Common
Stock in the name of the undersigned or in such other name as is specified
below:
(Please typewrite or print in block letters)
---------------------------------
(Name)
---------------------------------
---------------------------------
(Address)
3. The undersigned has reviewed, signed and enclosed an Investment
Representation Statement in the form attached as Exhibit C to the Warrant.
---------------------------------
Signature of Warrant holder
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Exhibit B
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and transfers unto
Name _______________________________________
(Please typewrite or print in block letters)
Address ____________________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date ____________, 20_______
Signature _____________________________
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Exhibit C
XXXXXX.XXX, INC.
WARRANT
INVESTMENT REPRESENTATION STATEMENT
AMOUNT: ______________________________________________________________
DATE: _______________, 2000
In connection with the purchase of the above-listed securities (the
"Securities") from XXXXXX.XXX ("the Company"), I the undersigned Purchaser
represent to the Company the following:
(a) I am aware of the Company's business affairs and financial
condition, and have acquired sufficient information about the Company to reach
an informed and knowledgeable decision to acquire the Securities. I am
purchasing these Securities for my own account for investment purposes only and
not with a view to, or for the resale in connection with, any "distribution"
thereof for purposes of the Securities Act of 1933, as amended ("Securities
Act").
(b) I understand that the Securities have not been registered under the
Securities Act in reliance upon a specific exemption therefrom, which exemption
depends upon, among other things, the bona fide nature of my investment intent
as expressed herein. In this connection, I understand that, in the view of the
Securities and Exchange Commission ("SEC"), the statutory basis for such
exemption may be unavailable if my representation was predicated solely upon a
present intention to hold these Securities for the minimum capital gains period
specified under tax statutes, for a deferred sale, for or until an increase or
decrease in the market price of the Securities, or for a period of one year or
any other fixed period in the future.
(c) I further understand that the Securities must be held indefinitely
unless subsequently registered under the Securities Act or unless an exemption
from registration is otherwise available. Moreover, I understand that the
Company is under no obligation to register the Securities. In addition, I
understand that the certificate evidencing the Securities will be imprinted with
a legend which prohibits the transfer of the Securities unless they are
registered or such registration is not required in the opinion of counsel for
the Company.
(d) I am aware of the provisions of Rule 144, promulgated under the
Securities Act, which, in substance, permits limited public resale of
"restricted securities" acquired, directly or indirectly, from the issuer
thereof (or from an affiliate of such issuer), in a transaction or series of
transactions not involving a non-public offering, subject to the satisfaction of
certain conditions.
(e) I further understand that at the time I wish to sell the Securities
there may be no public market upon which to make such a sale.
(f) I further understand that in the event all of the requirements of
Rule 144 are not satisfied, registration under the Securities Act, compliance
with Regulation A, or some other registration exemption will be required; and
that, notwithstanding the fact that Rule 144 is not exclusive, the Staff of the
SEC has expressed its opinion that persons proposing to sell private placement
securities other than in a registered offering and otherwise than pursuant to
Rule 144 will have a substantial burden of proof in establishing that an
exemption from registration is available for such offers or sales, and that such
persons and their respective brokers who participate in such transactions do so
at their own risk.
-----------------------------------
Name of Purchaser
-----------------------------------
Date
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