EXHIBIT 4 (e)
[40,000 - Millenium]
WARRANT AGREEMENT
WARRANT AGREEMENT, dated as of September 30, 1996, between LAVA, L.L.C., a
New Jersey limited liability company (the "Company"), and Millenium Capital
Management ("Holder").
Millenium has acted as a finder for the Company in connection with the
acquisition by Miracle Investment Co. ("Miracle") of 9 units of the Company's
securities ("Units"), each Unit consisting of a Senior Note in the denomination
of $50,000 and ten year warrants to purchase 50,000 units of ownership
("Ownership Interests") of the Company at an exercise price equal to $1.25 per
Ownership Interest and in connection therewith the Company has agreed to issue
to Millenium 20,000 ten year warrants at an exercise price of $1.25 per
Ownership Interest (the "$1.25 Warrants") and 20,000 ten year Warrants at an
exercise price of $2.00 per Ownership Interest (the $2.00 Warrants;
collectively, the "Warrants").
In consideration of the premises herein set forth and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Issue. The Company hereby issues to Holder two certificate (the "Warrant
Certificates") dated as of the date hereof providing Holder with the right to
purchase, at any time, until 5:30 p.m., New York time, on September 30, 2006,
40,000 Ownership Interests of the Company in the aggregate (the "Warrant
Ownership Interests") (subject to adjustment as provided in Section 8 hereof) at
an initial exercise price (subject to adjustment as provided in Section 8
hereof) of the 20,000 $1.25 Warrants equal to $1.25 per Ownership Interest and
of the 20,000 $2.00 Warrants equal to $2.00 per Ownership Interest.
2. Warrant Certificate. The Warrant Certificates to be delivered pursuant
to this Agreement shall be in the form set forth in Exhibit X, attached hereto
and made a part hereof, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Agreement.
3. Exercisability of Warrants. The Warrants shall be immediately
exercisable.
4. [Intentionally Omitted]
5. Procedure for Exercise of Warrants.
5.1 Cash Exercise. The Warrants are exercisable at an aggregate initial
exercise price per Ownership Interest set forth in Section 8 hereof payable by
certified check or official bank check in New York Clearing House funds. Upon
surrender of a Warrant Certificate with the annexed Form of Election to Purchase
duly executed, together with payment of the Exercise Price (as hereinafter
defined) for the Warrant Ownership Interests purchased, at the Company's
principal offices in California (presently located at 00000 Xxxxxxxx Xxxxxxxxx,
Xxxxx 0000, Xxx Xxxxxxx, XX 90024) Holder shall be entitled to receive a
certificate for the
Warrant Ownership Interests so purchased. The purchase rights represented by the
Warrant Certificate are exercisable at the option of the Holder thereof, in
whole or in part (but not as to fractional Ownership Interests underlying the
Warrants). In the case of the purchase of less than all the Warrant Ownership
Interest purchasable under the Warrant Certificate, the Company shall cancel
said Warrant Certificate upon the surrender thereof and shall execute and
deliver a new Warrant Certificate of like tenor for the balance of the Warrant
Ownership Interests purchasable thereunder.
5.2 Cashless Exercise. In addition to the exercise of all or a portion of
the Warrants by the payment of the Exercise Price in cash or check as set forth
in Section 5.1 above, and in lieu of any such payment, the Holder has the right
to exercise the Warrants, in full or in part, by surrendering the Warrant
Certificate with the annexed Form of Election to Purchase duly executed, in
exchange for the number of Ownership Interests equal to the product of (x) the
number of Ownership Interests as to which the Warrants are being exercised
multiplied by (y) a fraction, the numerator of which is the Current Market Price
of the Ownership Interests (as defined below) less the Exercise Price then in
effect and the denominator of which is the Current Market Price.
5.3 Current Market Price. The term "Current Market Price" shall mean (i) if
the Ownership Interests (and/or other securities (including shares of Common
Stock of the Company following the conversion of the Company into a
corporation), properties or rights issuable upon exercise of the Warrants
(collectively referred to as "Other Securities")) are traded in the
over-the-counter market or on the National Association of Securities Dealers,
Inc. Automated Quotations System ("NASDAQ"), the average per Ownership Interest
(or equivalent unit of Other Securities) closing bid prices on the 20
consecutive trading days immediately preceding the date of exercise, as reported
by NASDAQ or an equivalent generally accepted reporting service, or (ii) if the
Ownership Interests (or Other Securities) are traded on a national securities
exchange, the average for the 20 consecutive trading days immediately preceding
the exercise date of the daily per Ownership Interest (or equivalent unit of
Other Securities) closing prices on the principal stock exchange on which the
Ownership Interests (or Other Securities) are listed, as the case may be. The
closing price referred to in clause (ii) above shall be the last reported sales
price or, if no such reported sale takes place on such day, the average of the
reported closing bid and asked prices, in either case on the national securities
exchange on which the Ownership Interests (or Other Securities) are then listed.
6. Issuance of Certificate. Upon the exercise of the Warrants, the issuance
of a certificate for Warrant Ownership Interests (or Other Securities) shall be
made forthwith (and in any event within five (5) business days thereafter)
without charge to the Holder thereof including, without limitation, any tax
which may be payable in respect of the issuance thereof, and such certificate
shall (subject to the provisions of Sections 7 and 9 hereof) be issued in the
name of, or in such names as may be directed by, the Holder thereof; provided,
however, that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and delivery of any
such certificate in a name other than that of the Holder and the Company shall
not be required to issue or deliver such certificate unless or until the person
or persons requesting the issuance thereof shall have paid to the Company
the amount of such tax or shall have established to the satisfaction of the
Company that such tax has been paid.
The Warrant Certificate and the certificate representing the Warrant
Ownership Interests (or Other Securities) shall be executed on behalf of the
Company by the manual or facsimile signature of the then present Chairman or
Vice Chairman of the Board of Directors or President or any Vice President of
the Company under its corporate seal reproduced thereon, attested to by the
manual or facsimile signature of the then present Secretary or any Assistant
Secretary of the Company. The Warrant Certificate shall be dated the date of
execution by the Company upon initial issuance, division, exchange, substitution
or transfer.
7. Transfer of Warrants. The Holder of the Warrant Certificate, by its
acceptance thereof, covenants and agrees that the Warrants are being acquired as
an investment and not with a view to the distribution thereof. The Warrants may
be sold, transferred, assigned, hypothecated or otherwise disposed of, in whole
or in part, without restriction, subject to compliance with applicable
securities laws.
8. Exercise Price.
8.1 Initial and Adjusted Exercise Price. Except as otherwise provided in
Section 8 hereof, the initial exercise price of each Warrant shall be the price
set forth in Section 1 hereof per Warrant Ownership Interests issued thereunder.
The adjusted exercise price shall be the price which shall result from time to
time from any and all adjustments of the initial exercise price in accordance
with the provisions of Section 10 hereof.
8.2 Exercise Price. The term "Exercise Price" herein shall mean the initial
exercise price or the adjusted exercise price, depending upon the context.
9. Registration Under the Securities Act of 1933. The Warrants, the Warrant
Ownership Interests and any of the Other Securities issuable upon exercise of
the Warrants have not been registered under the Securities Act of 1933, as
amended (the "Act"). Upon exercise, in whole or in part, of the Warrants, a
certificate representing the Warrant Ownership Interests underlying the
Warrants, and any of the Other Securities issuable upon exercise of the Warrants
(collectively, the "Warrant Securities") shall bear the following legend unless
such Warrant Ownership Interests previously have been registered under the Act
in accordance with the terms hereof:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT, (ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR
ANY SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION OF SECURITIES),
OR (iii) AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY
SATISFACTORY TO COUNSEL TO THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION
UNDER THE ACT IS AVAILABLE.
Notwithstanding the foregoing, the Warrant Ownership Interests issuable
upon the exercise of the Warrants are entitled to certain registration rights as
more fully described in the Registration Agreement dated as of the date hereof
between the Company and Miracle, which is hereby incorporated herein by
reference in full. The Company agrees that the Warrant Ownership Interests shall
be deemed "Registrable Securities" thereunder.
10. Adjustments to Exercise Price and Number of Securities. The Exercise
Price and, in some cases, the number of Warrant Ownership Interests purchasable
upon the exercise of the Warrants, shall be subject to adjustment from time to
time upon the occurrence of certain events described in this Section 10.
10.1 Subdivision or Combination of Ownership Interests and Ownership
Interest Dividend. In case the Company shall at any time subdivide its
outstanding Ownership Interests into a greater number of Ownership Interests or
declare a dividend upon its Ownership Interests payable solely in Ownership
Interests, the Exercise Price in effect immediately prior to such subdivision or
declaration shall be proportionately reduced, and the number of Warrant
Ownership Interests issuable upon exercise of the Warrants shall be
proportionately increased. Conversely, in case the outstanding Ownership
Interests of the Company shall be combined into a smaller number of Ownership
Interests, the Exercise Price in effect immediately prior to such combination
shall be proportionately increased, and the number of Warrant Ownership
Interests issuable upon exercise of the Warrants shall be proportionately
reduced.
10.2 Dilutive Issuances. In the event that the Company shall sell or issue
at any time after the date of this Warrant and prior to its termination,
Ownership Interests (other than Excluded Ownership Interests, as defined in
Section 10.2.5) at a consideration per Ownership Interest less than $1.00, then
the Exercise Price shall be adjusted to a new Exercise Price (calculated to the
nearest cent) determined by dividing
(a) an amount equal to (i) the total number of Ownership Interests
Outstanding (as defined below and subject to adjustment in the manner set forth
in Section 10.1) on the date of issuance of this Warrant multiplied by the
Exercise Price in effect on the date of issuance of this Warrant (subject,
however, to adjustment in the manner set forth in Section 10.1), plus (ii) the
aggregate of the amount of all consideration, if any, received by the Company
for the issuance or sale of Ownership Interests since the date of issuance of
this Warrant, by
(b) the total number of Ownership Interests Outstanding immediately after
such issuance or sale.
In no event shall any such adjustment be made pursuant to this Section 10.2
if it would increase the Exercise Price in effect immediately prior to such
adjustment, except as provided in Sections 10.2.3 and 10.2.4. Upon each
adjustment of the Exercise Price pursuant to this Section 10.2, the holder of
this Warrant shall thereafter be entitled to purchase, at the Exercise Price
resulting from such adjustment, the number of Warrant Ownership Interests
obtained by multiplying the Exercise Price in effect immediately prior to such
adjustment by the number of Warrant Ownership Interests purchasable pursuant
hereto immediately prior to such adjustment, and dividing the product thereof by
the Exercise Price resulting from such adjustment.
10.2.1 Definitions. For purposes of this Section 10.2, the following
definitions shall apply:
(a) "Convertible Securities" shall mean any indebtedness or securities
convertible into or exchangeable for Ownership Interests.
(b) "Options" shall mean any rights, warrants or options to subscribe for
or purchase Ownership Interests or Convertible Securities other than rights,
warrants or options to purchase Excluded Securities (as defined in Section
10.2.5).
(c) "Ownership Interests Outstanding" shall mean the aggregate of all
Ownership Interests outstanding and all Ownership Interests issuable upon
exercise of all outstanding Options and conversion of all outstanding
Convertible Securities.
10.2.2 For the purposes of this Section 10.2, the following provisions
shall also be applicable:
10.2.2.1 Cash Consideration. In case of the issuance or sale of additional
Ownership Interests for cash, the consideration received by the Company therefor
shall be deemed to be the amount of cash received by the Company for such
Ownership Interests (or, if such Ownership Interests are offered by the Company
for subscription, the subscription price, or, if such Ownership Interests are
sold to underwriters or dealers for public offering without a subscription
offering, the public offering price), without deducting therefrom any
compensation or discount paid or allowed to underwriters or dealers or others
performing similar services or for any expenses incurred in connection
therewith.
10.2.2.2 Non-Cash Consideration. In case of the issuance (otherwise than
upon conversion or exchange of Convertible Securities) or sale of additional
Ownership Interests, Options or Convertible Securities for a consideration other
than cash or a consideration a part of which shall be other than cash, the fair
value of such consideration as determined by the Board of Directors (if any,
otherwise by the Managers) of the Company in the good faith exercise of its
business judgment, irrespective of the accounting treatment thereof, shall be
deemed to be the value, for purposes of this Section 10, of the consideration
other than cash received by the Company for such securities.
10.2.2.3 Options and Convertible Securities. In case the Company shall in
any manner issue or grant any Options or any Convertible Securities, the total
maximum number of Ownership Interests of issuable upon the exercise of such
Options or upon conversion or exchange of the total maximum amount of such
Convertible Securities at the time such Convertible Securities first become
convertible or exchangeable shall (as of the date of issue or grant of such
Options or, in the case of the issue or sale of Convertible Securities other
than where the same are issuable upon the exercise of Options, as of the date of
such issue or sale) be deemed to be issued and to be outstanding for the purpose
of this Section 10.2 and to have been issued for the sum of the amount (if any)
paid for such Options or Convertible Securities and the amount (if any) payable
upon the exercise of such Options or upon conversion or exchange of such
Convertible Securities at the time such Convertible Securities first become
convertible or exchangeable; provided that, subject to the provisions of Section
10.2.3, no
further adjustment of the Exercise Price shall be made upon the actual issuance
of any such Ownership Interests or Convertible Securities or upon the conversion
or exchange of any such Convertible Securities.
10.2.3 Change in Option Price or Conversion Rate. In the event that the
purchase price provided for in any Option referred to in subsection 10.2.2.3, or
the rate at which any Convertible Securities referred to in subsection 10.2.2.3
are convertible into or exchangeable for Ownership Interests shall change at any
time (other than under or by reason of provisions designed to protect against
dilution), then, for purposes of any adjustment required by Section 10.2, the
Exercise Price in effect at the time of such event shall forthwith be readjusted
to the Exercise Price that would have been in effect at such time had such
Options or Convertible Securities still outstanding provided for such changed
purchase price, additional consideration or conversion rate, as the case may be,
at the time initially granted, issued or sold, provided that if such
readjustment is an increase in the Exercise Price, such readjustment shall not
exceed the amount (as adjusted by Sections 10.1 and 10.2) by which the Exercise
Price was decreased pursuant to Section 10.2 upon the issuance of the Option or
Convertible Security. In the event that the purchase price provided for in any
such Option referred to in subsection 10.2.2.3, or the additional consideration
(if any) payable upon the conversion or exchange of any Convertible Securities
referred to in subsection 10.2.2.3, or the rate at which any Convertible
Securities referred to in subsection 10.2.2.3 are convertible into or
exchangeable for Ownership Interests, shall be reduced at any time under or by
reason of provisions with respect thereto designed to protect against dilution,
then in case of the delivery of Ownership Interests upon the exercise of any
such Option or upon conversion or exchange of any such Convertible Security; the
Exercise Price then in effect hereunder shall, upon issuance of such Ownership
Interests, be adjusted to such amount as would have obtained had such Option or
Convertible Security never been issued and had adjustments been made only upon
the issuance of the Ownership Interests delivered as aforesaid and for the
consideration actually received for such Option or Convertible Security and the
Ownership Interests, provided that if such readjustment is an increase in the
Exercise Price, such readjustment shall not exceed the amount (as adjusted by
Sections 10.1 and 10.2) by which the Exercise Price was decreased pursuant to
Section 10.2 upon the issuance of the Option or Convertible Security.
10.2.4 Termination Of Option or Conversion Rights. In the event of the
termination or expiration of any right to purchase Ownership Interests under any
Option granted after the date of this Warrant or of any right to convert or
exchange Convertible Securities issued after the date of this Warrant, the
Exercise Price shall, upon such termination, be readjusted to the Exercise Price
that would have been in effect at the time of such expiration or termination had
such Option or Convertible Security, to the extent outstanding immediately prior
to such expiration or termination, never been issued, and the Ownership
Interests issuable thereunder shall no longer be deemed to be Ownership
Interests Outstanding, provided that if such readjustment is an increase in the
Exercise Price, such readjustment shall not exceed the amount (as adjusted by
Sections 10.1 and 10.2) by which the Exercise Price was decreased pursuant to
Section 10.2 upon the issuance of the Option or Convertible Security. The
termination or expiration of any right to purchase Ownership Interests under any
Option granted prior to the date of this Warrant or of any right to convert or
exchange Convertible Securities issued prior to the date of this Warrant shall
not trigger any adjustment to the Exercise Price, but the Ownership Interests
issuable under such Options or Convertible
Securities shall no longer be counted in determining the number of Ownership
Interests Outstanding on the date of issuance of this Warrant for purposes of
subsequent calculations under this Section 10.2.
10.2.5 Excluded Ownership Interests. Notwithstanding anything herein to the
contrary, the Exercise Price shall not be adjusted pursuant to this Section 10.2
by virtue of the issuance and/or sale of Excluded Ownership Interests, which
shall mean the following: (a) Ownership Interests issuable upon the exercise of
the Warrants; (b) Ownership Interests, Options or Convertible Securities to be
issued and/or sold to employees, advisors (including, without limitation,
financial, technical and legal advisers), directors, or officers of, or
consultants to, the Company or any of its subsidiaries pursuant to a Ownership
Interest grant, Ownership Interest option plan, Ownership Interest purchase
plan, pension or profit sharing plan or other Ownership Interest agreement or
arrangement existing as of the date hereof or approved by the Company's Board of
Directors (if any, otherwise by the Managers); (c) the issuance of Ownership
Interests, Options and/or Convertible Securities pursuant to Options and
Convertible Securities outstanding as of the date of this Warrant; (d) the
issuance of Ownership Interests, Options or Convertible Securities as a
Ownership Interest dividend or upon any subdivision or combination of Ownership
Interest or Convertible Securities; (e) the issuance of Ownership Interests,
Options or Convertible Securities in connection with strategic partnerships or
other business and/or product consolidations or joint ventures and (f) the
issuance of Ownership Interests, Options or Convertible Securities by the
Company in connection with a contemplated equity financing currently in progress
as of the date hereof. For all purposes of this Section 10.2, all Ownership
Interests of Excluded Ownership Interests shall be deemed to have been issued
for an amount of consideration per Ownership Interest equal to the initial
Exercise Price (subject to adjustment in the manner set forth in Section 10.1).
In addition, if the amount of any adjustment pursuant to this Section 10 shall
be less than two cents (2(cent)) per Warrant Ownership Interest no adjustment to
the Exercise Price or to the number of Warrant Ownership Interests issuable upon
the exercise of the Warrants shall be made; provided, however, that 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 of and together with the next subsequent
adjustment which, together with any adjustment so carried forward, shall amount
to at least two cents (2(cent)) per Warrant Ownership Interest.
10.3 Notice of Adjustment. Promptly after adjustment of the Exercise Price
or any increase or decrease in the number of Warrant Ownership Interests
purchasable upon the exercise of this Warrant, the Company shall give written
notice thereof, by first class mail, postage prepaid, addressed to the
registered holder of this Warrant at the address of such holder as shown on the
books of the Company. The notice shall be signed by the Company's chief
financial officer and shall state (i) the effective date of the adjustment and
the Exercise Price resulting from such adjustment and (ii) the increase or
decrease, if any, in the number of Ownership Interests purchasable at such price
upon the exercise of this Warrant, setting forth in reasonable detail the method
of calculation and the facts upon which such calculation is based.
10.4 Other Notices. If at any time:
(a) the Company shall declare any cash dividend upon its Ownership
Interests;
(b) the Company shall declare any dividend upon its Ownership Interests
payable in securities (other than a dividend payable solely in Ownership
Interests) or make any special dividend or other distribution to the holders of
its Ownership Interests;
(c) there shall be any consolidation or merger of the Company with another
corporation, or a sale of all or substantially all of the Company's assets to
another corporation; or
(d) there shall be a voluntary or involuntary dissolution, liquidation or
winding-up of the Company;
then, in any one or more of said cases, the Company shall give, by certified or
registered mail, postage prepaid, addressed to the registered holder of this
Warrant at the address of such holder as shown on the books of the Company, (i)
at least 15 days' prior written notice of the date on which the books of the
Company shall close or a record shall be taken for such dividend, distribution
or subscription rights or for determining rights to vote in respect of any such
dissolution, liquidation or winding-up; (ii) at least 10 days' prior written
notice of the date on which the books of the Company shall close or a record
shall be taken for determining rights to vote in respect of any such
reorganization, reclassification, consolidation, merger or sale, and (iii) in
the case of any such reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation or winding-up, at least 15 days' written notice
of the date when the same shall take place. Any notice given in accordance with
clause (i) above shall also specify, in the case of any such dividend,
distribution or option rights, the date on which the holders of Ownership
Interests shall be entitled thereto. Any notice given in accordance with clause
(iii) above shall also specify the date on which the holders of Ownership
Interests shall be entitled to exchange their Ownership Interests for securities
or other property deliverable upon such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding-up, as the case
may be. If the Holder of the Warrant does not exercise this Warrant prior to the
occurrence of an event described above, except as provided in Sections 10.1 and
10.5, the Holder shall not be entitled to receive the benefits accruing to
existing holders of the Ownership Interests in such event.
10.5 Changes in Ownership Interests. In case at any time the Company shall
be a party to any transaction (including, without limitation, a merger,
consolidation, sale of all or substantially all of the Company's assets or
recapitalization of the Ownership Interests) in which the previously outstanding
Ownership Interests shall be changed into or exchanged for different securities
of the Company or common stock or other securities of another corporation or
interests in a non-corporate entity or other property (including cash) or any
combination of any of the foregoing (each such transaction being herein called
the "Transaction" and the date of consummation of the Transaction being herein
called the "Consummation Date"), then, as a condition of the consummation of the
Transaction, lawful and adequate provisions shall be made so that each Holder,
upon the exercise hereof at any time on or after the Consummation Date, shall be
entitled to receive, and this Warrant shall thereafter represent the right to
receive, in lieu of the Ownership Interests issuable upon such exercise prior to
the Consummation Date, the highest amount of securities or other property to
which such Holder would actually have been entitled as a holder of an Ownership
Interest upon the consummation
of the Transaction if such Holder had exercised such Warrant immediately prior
thereto. The provisions of this Section 10.5 shall similarly apply to successive
Transactions.
11. Exchange and Replacement of Warrant Certificate. The Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of Warrant Ownership Interest in such
denominations as shall be designated by the Holder thereof at the time of such
surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it of
the loss, theft, destruction or mutilation of the Warrant Certificate, and, in
case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable expenses
incidental thereto, and upon surrender and cancellation of the Warrants, if
mutilated, the Company will make and deliver a new Warrant Certificate of like
tenor, in lieu thereof.
12. Elimination of Fractional Interests. The Company shall not be required
to issue certificates representing fractions of Ownership Interests upon the
exercise of the Warrants, nor shall it be required to issue scrip or pay cash in
lieu of fractional interests, it being the intent of the parties that all
fractional interests shall be eliminated by rounding any fraction up to the
nearest whole number of Ownership Interests or Other Securities.
13. Reservation of Securities. The Company shall at all times reserve and
keep available out of its authorized Ownership Interests, solely for the purpose
of issuance upon the exercise of the Warrants, such number of Ownership
Interests or Other Securities as shall be issuable upon the exercise thereof.
The Company covenants and agrees that, upon exercise of the Warrants and payment
of the Exercise Price therefor, all Ownership Interests or Other Securities
issuable upon such exercise shall be duly and validly issued, fully paid,
non-assessable and not subject to the preemptive rights of any holder of
Ownership Interests.
14. Notices to Warrant Holder. Except as otherwise provided in Section
10.4, nothing contained in this Agreement shall be construed as conferring upon
the Holder by virtue of his holding the Warrant the right to vote or to consent
or to receive notice as a holder of an Ownership Interest in respect of any
meetings of such holders for the election of directors or any other matter, or
as having any rights whatsoever as such a holder of the Company.
15. Notices.
All notices, requests, consents and other communications hereunder shall be
in writing and shall be deemed to have been duly made and sent when delivered,
or mailed by registered or certified mail, return receipt requested:
(a) If to the registered Holder of the Warrants, to the address of
such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in Section 5 hereof or
to such other address as the Company may designate by notice to the Holder.
16. Supplements and Amendments. The Company and Holder may from time to
time supplement or amend this Agreement in order to cure any ambiguity, to
correct or supplement any provision contained herein which may be defective or
inconsistent with any provisions herein, or to make any other provisions in
regard to matters or questions arising hereunder which the Company and Holder
may deem necessary or desirable.
17. Successors. All the covenants and provisions of this Agreement shall be
binding upon and inure to the benefit of the Company, the Holder and their
respective successors and assigns hereunder. Any reference herein to the
"Company" shall include any corporation which is a successor to the limited
liability company structure currently used by the Company.
18. Termination. This Agreement shall terminate at the close of business on
the tenth anniversary of the issuance of the Warrants.
19. Governing Law. This Agreement and the Warrant Certificate issued
hereunder shall be deemed to be a contract made under the laws of the State of
New York and for all purposes shall be construed in accordance with the laws of
the State of New York without giving effect to the rules of the State of New
York governing the conflicts of laws.
20. Entire Agreement; Modification. This Agreement contains the entire
understanding between the parties hereto with respect to the subject matter
hereof and may not be modified or amended except by a writing duly signed by the
party against whom enforcement of the modification or amendment is sought.
21. Severability. If any provision of this Agreement shall be held to be
invalid or unenforceable, such invalidity or unenforceability shall not affect
any other provision of this Agreement.
22. Captions. The caption headings of the Sections of this Agreement are
for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive effect.
23. Benefits of this Agreement. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and Holder
any legal or equitable right, remedy or claim under this Agreement; and this
Agreement shall be for the sole and exclusive benefit of the Company and Holder.
24. Counterparts. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Warrant Agreement to be
duly executed, as of the day and year first above written.
LAVA, L.L.C.
By: /s/ Xxxxx Xxxxxx
-------------------------------
Authorized Officer
HOLDER: MILLENIUM CAPITAL
MANAGEMENT
By: /s/ Xxxx Xxxxxxx
------------------------------
Name: Xxxx Xxxxxxx
Title: President
EXHIBIT X
TO
WARRANT AGREEMENT
[FORM OF WARRANT CERTIFICATE]
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES ISSUABLE
UPON EXERCISE THEREOF MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT") (ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY
SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (iii)
AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO
COUNSEL FOR THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER THE ACT IS
AVAILABLE.
EXERCISABLE UNTIL
5:30 P.M., NEW YORK TIME, SEPTEMBER 30, 2006
No. W-LAVA-[302][303] [20,000][20,000] Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that Millenium Capital Management or its
registered assigns ("Holder"), is the registered holder of [20,000][20,000]
Warrants to purchase initially at any time until 5:30 p.m. New York time on
September 30, 2006 ("Expiration Date"), up to 450,000 fully-paid and
non-assessable economic ownership interests ("Ownership Interests") of LAVA,
L.L.C., a New Jersey limited liability company (the "Company"), at the initial
exercise price, subject to adjustment in certain events (the "Exercise Price"),
equal to [$1.25][2.00] per Ownership Interest upon surrender of this Warrant
Certificate and payment of the Exercise Price at an office or agency of the
Company, but subject to the conditions set forth herein and in the Warrant
Agreement dated as of the date hereof between the Company and Holder (the
"Warrant Agreement"). Payment of the Exercise Price shall be made by certified
check or official bank check in New York Clearing House funds payable to the
order of the Company, unless exercise is made pursuant to Section 5.2 of the
Warrant Agreement.
No Warrant may be exercised after 5:30 p.m., New York time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which
Warrant Agreement is hereby incorporated by reference in and made a part of this
instrument and is hereby referred to for a description of the rights, limitation
of rights, obligations, duties and immunities
thereunder of the Company and the Holder (the word "Holder" meaning the
registered holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain events
the Exercise Price and the type and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the holder, issue a new Warrant
Certificate evidencing the adjustment in the Exercise Price and the number
and/or type of securities issuable upon the exercise of the Warrants; provided,
however, that the failure of the Company to issue such new Warrant Certificate
shall not in any way change, alter, or otherwise impair, the rights of the
holder as set forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax or other governmental charge
imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such number of unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the Warrant
Agreement shall have the meanings assigned to them in the Warrant Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
duly executed.
Dated as of September __, 1996
LAVA, L.L.C.
By: /s/ Xxxxx Xxxxxx
-----------------------------
Authorized Officer
[FORM OF ELECTION TO PURCHASE]
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase ________ Ownership
Interests and herewith tenders in payment for such securities a certified check
or official bank check payable in New York Clearing House Funds to the order of
LAVA, L.L.C. in the amount of $ , all in accordance with the terms of Section 5
of the Warrant Agreement dated as of September 30, 1996 between Lava, L.L.C. and
the undersigned (or its assignor). The undersigned requests that a certificate
for such securities be registered in the name of ____________________ whose
address is ____________________ and that such Certificate be delivered to
____________________ whose address is ____________________.
Dated:
Signature _____________________________
(Signature must conform in all respects
to name of holder as specified on the
face of the Warrant Certificate.)
_______________________________________
(Insert Social Security or Other
Identifying Number of Holder)
[FORM OF ASSIGNMENT]
(To be executed by the registered holder if such holder
desires to transfer the Warrant Certificate.)
FOR VALUE RECEIVED ___________ hereby
sells, assigns and transfers unto
_____________________________________
(Please print name and address of transferee)
this Warrant Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint ______ Attorney, to transfer
the within Warrant Certificate on the books of the within-named Company, with
full power of substitution.
Dated: ________________
Signature _____________________________
(Signature must conform in all respects
to name of holder as specified on the
face of the Warrant Certificate.)
_______________________________________
(Insert Social Security or Other
Identifying Number of Assignee)
