EXHIBIT 4.1
THESE WARRANTS AND THE SECURITIES ISSUABLE UPON THEIR EXERCISE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED UNLESS
COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, OR AN OPINION OF
COUNSEL SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY SUCH TRANSFER IS
EXEMPT FROM SUCH REGISTRATION.
INTELLICELL CORP.
REDEEMABLE WARRANT TO PURCHASE COMMON STOCK
This certifies that _________________________ is the holder of
_____________ warrants, each warrant entitling the holder at any time up to and
including 5:00 p.m. California Time on April 30, 2002 (the "Expiration Date") to
purchase from Intellicell Corp., a Delaware corporation (hereinafter called the
"Company"), one share of Common Stock of the Company at a price ("Exercise
Price") of One Dollar and Fifty Cents ($1.50) per share upon the surrender of
this warrant to the Company at its office at 0000 Xxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxxxx 00000, during its usual business hours of any business day, with
simultaneous payment in lawful money of the United States of the purchase price
set forth above.
THIS ISSUANCE OF WARRANTS (THE "WARRANTS") IN A PRIVATE PLACEMENT (THE
"OFFERING") IS BEING MADE TO SELECTED ACCREDITED INVESTORS WHO ARE PURCHASING
SHARES OF COMMON STOCK FROM XXX XXXXX AT $2.50 PER SHARE (THE "XXXXX SHARES").
1. EXERCISE OF WARRANT. Subject to the terms and conditions hereof,
this Warrant may be exercised in whole or in part, at any time during normal
business hours prior to the Expiration Date, by (i) delivery of a written
notice, in the form of the Notice of Exercise attached hereto, of such holder's
election to exercise this Warrant, which notice shall specify the number of
shares to be purchased upon exercise hereof, (ii) payment to the Company of an
amount equal to the Exercise Price multiplied by the number of shares as to
which this Warrant is being exercised (plus any applicable issue or transfer
taxes) in cash or by bank check, and (iii) the surrender of this Warrant at the
principal office of the Company. If this Warrant is being exercised only in
part, the Company shall issue a new Warrant identical in all respects to this
Warrant except that it shall represent the right to purchase the number of
shares as to which this Warrant is not then being exercised. The Company has the
right at its sole discretion to extend the Expiration Date by notice given to
all Warrant holders. No fractional share shall be issued upon the exercise of
rights to purchase hereunder.
2. REGISTRATION OF COMMON STOCK. The Company and the investors in the
Offering will enter into a Registration Rights Agreement pursuant to which the
Company will file one or more registration statements with the SEC with respect
to the Warrant Shares and Xxxxx Shares, as well as other shares held by, or
underlying other securities held by, other securityholders and the Company's
directors, officers and consultants (collectively, the "Registrable Shares"),
within 90 days following the closing and will use its reasonable best efforts to
have such registration statements are declared effective as soon as possible
thereafter. If such registration statements are declared effective, the Company
shall use its reasonable best efforts following the effective date to keep the
registration statements continuously effective, supplemented and amended through
December 31, 2002.
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3. REDEMPTION OF WARRANTS. At any time after May 1, 2000 and provided
that the Warrant Shares have been registered under the Securities Act for
resale, the Company has the right to redeem the Warrants in whole or in part at
a price of $0.01 per Warrant, by written notice mailed at least 30 days before
the specified redemption date, to each Warrant holder at his address as it
appears on the books of the Company; provided, however, that such notice may
only be given following a period of 20 consecutive trading days that ends on or
after May 1, 2000 during which the closing price for the Common Stock has
exceeded $3.00 per share on each such day. If the Warrants are called for
redemption, they must be exercised prior to the close of business on the
redemption date, or else the right to exercise such Warrants and to purchase the
Warrant Shares will be forfeited.
4. ADJUSTMENTS.
(a) The warrant price at which Common Stock shall be purchasable upon
the exercise of the Warrants shall be $1.50 per share or after adjustment, as
provided in this Section, shall be such price as so adjusted (the "Warrant
Price").
(b) The Warrant Price shall be subject to adjustment from time to time
as follows:
(i) In case the Company shall at any time after the date
hereof pay a dividend in shares of Common Stock or make a distribution in shares
of Common Stock, then upon such dividend or distribution the Warrant Price in
effect immediately prior to such dividend or distribution shall forthwith be
reduced to a price determined by dividing:
(A) an amount equal to the total number of shares of Common
Stock outstanding immediately prior to such dividend or distribution multiplied
by the Warrant Price in effect immediately prior to such dividend or
distribution, by (B) the total number of shares of Common Stock outstanding
immediately after such issuance or sale.
For the purposes of any computation to be made in accordance
with the provisions of this Section 4(b)(i), the following provisions shall be
applicable: Common Stock issuable by way of dividend or other distribution on
any stock of the Company shall be deemed to have been issued immediately after
the opening of business on the date following the date fixed for the
determination of stockholders entitled to receive such dividend or other
distribution.
(ii) In case the Company shall at any time subdivide or
combine the outstanding Common Stock, the Warrant Price shall forthwith be
proportionately decreased in the case of subdivision or increased in the case of
combination to the nearest one cent. Any such adjustment shall become effective
at the time such subdivision or combination shall become effective.
(iii) Within a reasonable time after the close of each
quarterly fiscal period of the Company during which the Warrant Price has been
adjusted as herein provided, the Company shall:
(A) file with the transfer agent of the Warrants (the
"Warrant Agent") a certificate signed by the President or Vice President of the
Company and by the Treasurer or an Assistant Treasurer or the Secretary or an
Assistant Secretary of the Company, showing in detail the facts requiring all
such adjustments occurring during such period and the Warrant Price after each
such adjustment; and
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(B) the Warrant Agent shall have no duty with respect to any
such certificate filed with it except to keep the same on file and available for
inspection by holders of Warrants during reasonable business hours, and the
Warrant Agent may conclusively rely upon the latest certificate furnished to it
hereunder. The Warrant Agent shall not at any time be under any duty or
responsibility to any holder of a Warrant to determine whether any facts exist
which may require any adjustment of the Warrant Price, or with respect to the
nature or extent of any adjustment of the Warrant Price when made, or with
respect to the method employed in making any such adjustment, or with respect to
the nature or extent of the property or securities deliverable hereunder. In the
absence of a certificate having been furnished, the Warrant Agent may
conclusively rely upon the provisions of the Warrants with respect to the Common
Stock deliverable upon the exercise of the Warrants and the applicable Warrant
Price thereof.
(iv) Notwithstanding anything contained herein to the
contrary, no adjustment of the Warrant Price shall be made if the amount of such
adjustment shall be less than $0.05, but in such case any adjustment that would
otherwise be required then to be made shall be carried forward and shall be made
at the time and together with the next subsequent adjustment which, together
with any adjustment so carried forward, shall amount to not less than $0.05.
(v) In the event that the number of outstanding shares of
Common Stock is increased by a stock dividend payable in subdivision of the
outstanding Common Stock, then, from and after the time at which the adjusted
Warrant Price becomes effective pursuant this Section by reason of such dividend
or subdivision, the Common Stock issuable upon the exercise of each Warrant
shall be increased in proportion to such increase in outstanding shares. In the
event that the number of shares of Common Stock outstanding is decreased by a
combination of the outstanding Common Stock, then, from and after the time at
which the adjusted Warrant Price becomes effective pursuant to this Section by
reason of such combination, the number of shares of Common Stock issuable upon
the exercise of each Warrant shall be decreased in proportion to such decrease
in the outstanding shares of Common Stock.
(vi) In case of any reorganization or reclassification of the
outstanding Common Stock (other than a change in par value, or from par value to
no par value, or as a result of a subdivision or combination), or in case of any
consolidation of the Company with, or merger of the Company into, another
corporation (other than a consolidation or merger in which the Company is the
continuing corporation and which does not result in any reclassification of the
outstanding Common Stock), or in case of any sale or conveyance to another
corporation of the property of the Company as an entirety or substantially as an
entirety, the holder of each Warrant then outstanding shall thereafter have the
right to purchase the kind and amount of shares of Common Stock and other
securities and property receivable upon such reorganization, reclassification,
consolidation, merger, sale or conveyance by a holder of the number of shares of
Common Stock which the holder of such Warrant shall then be entitled to
purchase; such adjustments shall apply with respect to all such changes
occurring after the date of exercise of such Warrant.
(vii) Subject to the provisions of this Section 4, in case the
Company shall, at any time prior to the exercise of the Warrants, make any
distribution of its assets to holders of its Common Stock as a liquidating or a
partial liquidating dividend, then the holder of Warrants who exercises its
Warrants after the record date for the determination of those holders of Common
Stock entitled to such distribution of assets as a liquidating or partial
liquidating dividend shall be entitled to receive for the Warrant Price per
Warrant, in addition to each share of Common Stock, the amount of such
distribution (or, at the option of the Company, a sum equal to the value of any
such assets at the time of such distribution as determined by the Board of
Directors of the Company in
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good faith), which would have been payable to such holder had he been the holder
of record of the Common Stock receivable upon exercise of its Warrant on the
record date for the determination of those entitled to such distribution.
(viii) In case of the dissolution, liquidation or winding up
of the Company, all rights under the Warrants shall terminate on a date fixed by
the Company, such date to be no earlier than ten (10) days prior to the
effectiveness of such dissolution, liquidation or winding up and not later than
five (5) days prior to such effectiveness. Notice of such termination of
purchase rights shall be given to the last registered holder of the Warrants, as
the same shall appear on the books of the Company maintained by the Warrant
Agent, by registered mail at least thirty (30) days prior to such termination
date.
(ix) In case the Company shall, at any time prior to the
expiration of the Warrants and prior to the exercise thereof, offer to the
holders of its Common Stock any rights to subscribe for additional shares of any
class of the Company, then the Company shall give written notice thereof to the
last registered holder thereof not less than thirty (30) days prior to the date
on which the books of the Company are closed or a record date is fixed for the
determination of the stockholders entitled to such subscription rights. Such
notice shall specify the date as to which the books shall be closed or record
date fixed with respect to such offer of subscription and the right of the
holder thereof to participate in such offer of subscription shall terminate if
the Warrant shall not be exercised on or before the date of such closing of the
books or such record date.
(x) Any adjustment pursuant to the aforesaid provisions of
this section 4 shall be made on the basis of the number of shares of Common
Stock which the holder thereof would have been entitled to acquire by the
exercise of the Warrant immediately prior to the event giving rise to such
adjustment.
(xi) Irrespective of any adjustments in the Warrant Price or
the number or kind of shares purchasable upon exercise of the Warrants, Warrants
previously or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the similar Warrants initially
issuable pursuant to this Warrant Agreement.
(xii) The Company may retain a firm of independent public
accountants (who may be any such firm regularly employed by the Company) to make
any computation required under this Section 4, and any certificate setting forth
such computation signed by such firm shall be conclusive evidence of the
correctness of any computation made under this Section 4.
(xiii) If at any time, as a result of an adjustment made
pursuant to Section 4(b)(vi) above, the holders of a Warrant or Warrants shall
become entitled to purchase any securities other than shares of Common Stock,
thereafter the number of such securities so purchasable upon exercise of each
Warrant and the Warrant Price for such shares 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 Section 4(b)(ii)
through (v).
(xiv) No adjustment shall be made to the Warrant Price as the
result of the repricing of the currently outstanding warrants.
5. NOTICES TO WARRANT HOLDERS.
(a) Upon any adjustment of the Warrant Price and the number of shares
of Common Stock issuable upon exercise of a Warrant, then and in each such case
the Company shall give
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written notice thereof to the Warrant Agent, which notice shall state the
Warrant Price resulting from such adjustment and the increase or decrease, if
any, in the number of shares purchasable at such price upon the exercise of a
Warrant, setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based. The Company shall also mail such
notice to the holders of the Warrants at their addresses appearing in the
Warrant register. Failure to give or mail such notice, or any defect therein,
shall not affect the validity of the adjustments.
(b) In case at any time:
(i) the Company shall pay dividends payable in stock upon its
Common Stock or make any distribution (other than regular cash dividends) to the
holders of its Common Stock; or
(ii) the Company shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any class or other
rights; or
(iii) there shall be any capital reorganization or
reclassification of the capital stock of the Company, or consolidation or merger
of the Company with, or sale of substantially all of its assets to, another
corporation; or
(iv) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company; then in any one or more of such cases,
the Company shall give written notice in the manner set forth in Section 5(a) of
the date on which (A) a record shall be taken for such dividend, distribution or
subscription rights, or (B) such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up shall take
place, as the case may be. Such notice shall also specify the date as of which
the holders of Common Stock of record shall participate in such dividend,
distribution or subscription rights, or shall be entitled to exchange their
Common Stock for securities or other 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 action in question and not less than thirty
(30) days prior to the record date in respect thereof. Failure to give such
notice, or any defect therein, shall not affect the legality or validity of any
of the matters set forth in this Section 5(b).
(c) The Company shall cause copies of all financial statement and
reports, proxy statements and other documents that are sent to its stockholders
to be sent by first-class mail, postage prepaid, on the date of mailing to such
stockholders, to each registered holder of Warrants at his address appearing in
the warrant register as of the record date for the determination of the
stockholders entitled to such documents.
6. WARRANT HOLDER. Prior to the due presentment for registration of
transfer hereof, the Company and the Warrant Agent may deem and treat the
registered holder as the absolute owner hereof and of each Warrant represented
hereby (notwithstanding any notations of ownership or writing hereon made by
anyone other than a duly authorized officer of the Company or the transfer
agent) for all purposes and shall not be affected by any notice to the contrary.
7. NO RIGHTS AS STOCKHOLDER. Prior to the exercise of this Warrant the
holder of this Warrant shall not be entitled to any rights of a stockholder of
the Company, including, without limitation, the right to vote, to receive
dividends or other distributions, or to receive notice of meetings of
stockholders.
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8. LOST, STOLEN, MUTILATED OR DESTROYED WARRANTS. If this Warrant is
lost, stolen, mutilated or destroyed, the Company shall, on such terms as to
indemnity or otherwise as it may in its discretion impose (which in the case of
a mutilated Warrant shall include the surrender thereof), issue a new Warrant of
like denomination and tenor as the Warrant so lost, stolen, mutilated or
destroyed. Any such new Warrant shall constitute an original contractual
obligation of the Company, whether or not the allegedly lost, stolen, mutilated
or destroyed Warrant shall be at any time enforceable by anyone.
9. MISCELLANEOUS. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
Person or holder hereof against which enforcement of such change, waiver,
discharge or termination is sought. The headings in this Warrant are for
purposes of reference only and shall not limit or otherwise affect the meaning
hereof.
IN WITNESS WHEREOF, the Company has executed this Warrant as of the day
and year first above written.
Dated: May 13, 1999 INTELLICELL CORP.
By
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Xxxxxxx Xxxxx, Chief Executive Officer
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NOTICE OF EXERCISE
TO BE EXECUTED BY THE REGISTERED HOLDER
IN ORDER TO EXERCISE THIS WARRANT
INTELLICELL CORP.
The undersigned hereby exercises the right to purchase
_____________________________ shares of Common Stock covered by this Warrant
according to the conditions thereof and herewith makes payment of
$______________________________, the aggregate Exercise Price of such shares of
Common Stock.
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[Print or type name(s) of Holder. If Holder
is a trust, patnership, corporation or other
entity, print name and title of authorized
signatory.]
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Signature(s) of Holder or authorized signatory
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