EXHIBIT 2.4
No. W-___
PERMA-TUNE ELECTRONICS, INC.
(A TEXAS CORPORATION)
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WARRANT TO PURCHASE
SHARES OF COMMON STOCK
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THIS CERTIFIES THAT, for value received, _________________, or
registered assigns ("Holder") is entitled to purchase, subject to the
conditions set forth below, at any time or from time to time during the
Exercise Period (as defined in subsection 1.3 below) ______ shares ("Shares")
of fully paid and non-assessable Common Stock, $.001 par value ("Common
Stock"), of Perma-Tune Electronics, Inc., a Texas corporation (the
"Company"), at the per share purchase price (the "Warrant Price") set forth
in subsection 1.2, subject to the further provisions of this Warrant.
1. EXERCISE OF WARRANT
The terms and conditions upon which this Warrant may be exercised,
and the Common Stock covered hereby may be purchased, are as follows:
1.1 ISSUANCE. This Warrant is being issued in connection with the
offering by the Company of 125,000 Units, each Unit consisting of one share
of Common Stock and Warrants to purchase three shares of common stock,
pursuant to the provisions of Rule 504 of Regulation D under the Securities
Act of 1933, as amended (the "Act"). The Holder named above has purchased
Units in such offering and this Warrant is described in the Offering Circular
of the Company dated December 8, 1997.
1.2 WARRANT PRICE. The Warrant Price shall be equal to $2.00 per
Share, subject to adjustment as provided in Section 4 below.
1.3 METHOD OF EXERCISE. Subject to the provisions of subsection
1.1 above, the Holder of this Warrant, may on only one occasion, at any time
prior to December 31, 1999, unless extended by the Company in its sole
discretion (the "Exercise Period"), exercise in whole or in part the purchase
rights evidenced by this Warrant. Such exercise shall be effected by:
(a) the surrender of the Warrant, together with a duly
executed copy of the form of Subscription attached hereto, to the Warrant
Agent for the Company at its principal offices; and
(b) the payment to the Company, by certified check or bank
draft payable to its order, of an amount equal to the aggregate Warrant Price
for the number of Shares for which the
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purchase rights hereunder are being exercised.
1.4 SATISFACTION OF REQUIREMENTS OF SECURITIES ACT OF 1933. Each
and every exercise of this Warrant is contingent upon the Company's
satisfaction that the issuance of Common Stock upon the exercise is exempt
from the requirements of the Act and all applicable state securities laws.
The Holder of this Warrant agrees to execute any and all documents deemed
necessary by the Company to effect the exercise of this Warrant.
1.5 ISSUANCE OF SHARES. In the event the purchase rights evidenced
by this Warrant are exercised in whole or in part, one or more certificates
for the purchased Shares shall be issued as soon as practicable thereafter to
the person exercising such rights. In the event of a partial exercise, such
Holder will not have the right to purchase any additional Shares pursuant to
this Warrant.
2. TRANSFERS
2.1 TRANSFERS. Subject to Section 7 hereof, this Warrant and all
rights hereunder are transferable in whole or in part by the Holder. Such
transfer shall be recorded on the books of the Company upon the surrender of
this Warrant, properly endorsed, to the Warrant Agent for the Company at its
principal offices and the payment to the Company of all transfer taxes and
other governmental charges imposed on such transfer and shall only be
effective with respect to the Company upon such recordation.
2.2 REGISTERED HOLDER. Each Holder agrees that until such time as
any transfer pursuant to subsection 2.1 is recorded on the books of the
Company, the Company may treat the registered Holder of this Warrant as the
absolute owner; provided that nothing herein affects any requirement that
transfer of any Warrant or share of Common Stock issued or issuable upon the
exercise thereof be subject to securities law compliance.
2.3 FORM OF NEW WARRANTS. All Warrants issued in connection with
transfers of this Warrant shall bear the same date as this Warrant and shall
be substantially identical in form and provision to this Warrant.
3. FRACTIONAL SHARES
Notwithstanding that the number of Shares purchasable upon the
exercise of this Warrant may have been adjusted pursuant to the terms hereof,
the Company shall nonetheless not be required to issue fractions of Shares
upon exercise of this Warrant or to distribute certificates that evidence
fractional shares nor shall the Company be required to make any cash payments
in lieu thereof upon exercise of this Warrant. Holder hereby waives any
right to receive fractional Shares.
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4. ANTI-DILUTION PROVISIONS
4.1 STOCK SPLITS AND COMBINATIONS. If the Company shall at any
time subdivide or combine its outstanding shares of Common Stock, this
Warrant shall, after that subdivision or combination evidence the right to
purchase the number of shares of Common Stock that would have been issuable
as a result of that change with respect to the Shares of Common Stock which
were purchasable under this Warrant immediately before that subdivision or
combination. If the Company shall at any time subdivide the outstanding
shares of Common Stock, the Warrant Price then in effect immediately before
that subdivision shall be proportionately decreased, and, if the Company
shall at any time combine its outstanding shares of Common Stock, the Warrant
Price then in effect immediately before that combination shall be
proportionately increased. Any adjustment under this section shall become
effective at the close of business on the date the subdivision or combination
becomes effective.
4.2 RECLASSIFICATION, EXCHANGE AND SUBSTITUTION. If the Common
Stock issuable upon exercise of this Warrant shall be changed into the same
or a different number of shares of any other class or classes of stock,
whether by capital reorganization, reclassification, or otherwise (other than
a subdivision or combination of shares provided for above), the Holder of
this Warrant shall, on its exercise, be entitled to purchase for the same
aggregate consideration, in lieu of the Common Stock which the Holder would
have become entitled to purchase but for change, a number of shares of such
other class or classes of stock equivalent to the number of shares of Common
Stock that would have been subject to purchase by the Holder on exercise of
this Warrant immediately before that change.
4.3 REORGANIZATION, MERGERS, CONSOLIDATIONS, OR SALE OF ASSETS. If
at any time there shall be a capital reorganization of the Company's Common
Stock (other than a combination, reclassification, exchange, or subdivision
of shares provided for elsewhere above) or merger or consolidation of the
Company with or into another corporation, or the sale of the Company's
properties and assets as, or substantially as, an entirety to any other
person, then, as a part of such reorganization, merger, consolidation or
sale, lawful provision shall be made so that the Holder of this Warrant shall
thereafter be entitled to receive upon exercise of this Warrant, during the
period specified in this Warrant and upon payment of the Warrant Price then
in effect, the number of shares of Common Stock or other securities or
property of the Company, or of the successor corporation resulting from such
merger or consolidation, to which a holder of the Common Stock deliverable
upon exercise of this Warrant would have been entitled in such capital
reorganization, merger, or consolidation or sale if this Warrant had been
exercised immediately before that capital reorganization, merger,
consolidation, or sale. In any such case, appropriate adjustment
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(as determined in good faith by the Company's Board of Directors) shall be
made in the application of the provisions of this Warrant with respect to the
rights and interests of the Holder of this Warrant after the reorganization,
merger, consolidation, or sale to the end that the provisions of this Warrant
(including adjustment of the Warrant Price then in effect and the number of
Shares purchasable upon exercise of this Warrant) shall be applicable after
that event, as near as reasonably may be, in relation to any shares or other
property deliverable after that event upon exercise of this Warrant. The
Company shall, within thirty (30) days after making such adjustment, give
written notice (by first class mail, postage prepaid) to the registered
Holder of this Warrant at the address of that Holder shown on the Company's
books. That notice shall set forth, in reasonable detail, the event
requiring the adjustment and the method by which the adjustment was
calculated and specify the Warrant Price then in effect after the adjustment
and the increased or decreased number of Shares purchasable upon exercise of
this Warrant. When appropriate, that notice may be given in advance and
include as part of the notice required under other provisions of this Warrant.
4.4 RESERVATION OF STOCK ISSUABLE UPON EXERCISE. The Company shall
at all times reserve and keep available out of its authorized but unissued
shares of Common Stock solely for the purpose of effecting the exercise of
this Warrant such number of its shares of Common Stock as shall from time to
time be sufficient to effect the exercise of this Warrant and if at any time
the number of authorized by unissued shares of Common Stock shall not be
sufficient to effect the exercise of this Warrant, in addition to such other
remedies as shall be available to the holder of this Warrant, the Company
will use its best efforts to take such corporate action as may, in the
opinion of its counsel, be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for
such purposes.
5. RIGHTS PRIOR TO EXERCISE OF WARRANT
This Warrant does not entitle the Holder to any of the rights of a
stockholder of the Company, including without limitation, the right to
receive dividends or other distributions, to exercise any preemptive rights,
to vote, or to consent or to receive notice as a stockholder of the Company.
If, however, at any time prior to the expiration of this Warrant and prior to
its exercise, any of the following events shall occur:
(a) the Company shall declare any dividend payable in any
securities upon its shares of Common Stock or make any distribution (other
than a regular cash dividend) to the holders of its shares of Common Stock; or
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(b) the Company shall offer to the holders of its shares of
Common Stock any additional shares of Common Stock or securities convertible
into or exchangeable for shares of Common Stock or any right to subscribe for
or purchase any thereof; or
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation, merger, sale, transfer or
lease of all or substantially all of its property, assets, and business as an
entirety) shall be proposed and action by the Company with respect thereto
has been approved by the Company's Board of Directors, then in any one or
more of said events the Company shall give notice in writing of each such
event to the Holder at his last address as it shall appear on the Company's
records at least twenty (20) days' prior to the date fixed as a record date
or the date of closing the transfer books for the determination of the
stockholders entitled to such dividends, distribution, or subscription
rights, or for the determination of stockholders entitled to vote on such
proposed dissolution, liquidation or winding up. Such notice shall specify
such record date of closing the transfer books, as the case may be. Failure
to publish, mail or receive such notice or any defect therein or in the
publication or mailing thereof shall not affect the validity of any action
taken in connection with such dividend, distribution or subscription rights,
or such proposed dissolution, liquidation or winding up. Each person in
whose name any certificate for Shares of Common Stock is to be issued shall
for all purposed be deemed to have become the holder of record of such Shares
on the date on which the instrument was surrendered and payment of the
Warrant Price was made, irrespective of the date of delivery of such stock
certificate, except that, if the date of such surrender and payment is a date
when the stock transfer books of the Company are closed, such person shall be
deemed to have become the holder of such shares of Common Stock at the close
of business on the next succeeding date on which the stock transfer books are
open.
6. SUCCESSORS AND ASSIGNS
The terms and provisions of this Warrant shall inure to the benefit
of, and be binding upon, the Company and the Holder thereof and their
respective successors and permitted assigns.
7. REDEMPTION OF WARRANT
The Company may redeem this Warrant at any time prior to its
exercise upon thirty (30) days written notice to the Holder (the "Redemption
Notice Period") if the Common Stock of the Company shall trade in any public
market at a reported closing bid price or trade price at or above $2.50 for
at least ten (10) consecutive days. The redemption price shall be $.05 per
Share and shall be payable to the Holder within thirty (30) days following
the termination of such thirty (30) day period. This Warrant shall be
exercisable until 5:00 p.m. on the thirtieth day
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of the Redemption Notice Period.
8. WARRANT AGENT
The Warrant Agent for the Company is Pacific Stock Transfer Company,
whose principal office is 0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000, Xxx Xxxxx,
Xxxxxx 00000.
9. LOSS OR MUTILATION
Upon receipt by the Company of satisfactory evidence of the
ownership of and the loss, theft, destruction, or mutilation of any Warrant,
and (i) in the case of loss, theft, or destruction, upon receipt by the
Company of indemnity satisfactory to it, or (ii) in the case of mutilation,
upon receipt of such Warrant and upon surrender and cancellation of such
Warrant, the Company shall execute and deliver in lieu thereof a new Warrant
representing the right to purchase an equal number of Shares of Common Stock.
10. NOTICES
All notices, requests, demands and other communications under this
Warrant shall be in writing and shall be deemed to have been duly given on
the date of service if served personally on the party to whom notice is to be
given, or on the date of mailing if mailed to the party to whom notice is to
be given, by first class mail, registered or certified, postage prepaid, and
properly addressed as follows: if to the Holder, at his address as shown in
the Company records; and if to the Company or the transfer agent, at the
principal office of such party. Any party may change its address for
purposes of this subsection by giving the other party written notice of the
new address in the manner set forth above.
11. GOVERNING LAW
This Warrant and any dispute, disagreement or issue of construction
or interpretation arising hereunder whether relating to its execution, its
validity, the obligations provided herein or performance shall be governed or
interpreted according to the internal laws of the State of Texas without
regard to conflicts of law.
Dated: _____________
PERMA-TUNE ELECTRONICS, INC.
____________________________
Xxxxxx Xxxxxxxxxx, President
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SUBSCRIPTION
PERMA-TUNE ELECTRONICS, INC.
000 Xxxxx Xxxxxxxxxx Xxxxxx
Xxxxx, Xxxxx 00000
Gentlemen:
The undersigned, _________________, hereby elects to purchase,
pursuant to the provisions of the foregoing Warrant held by the undersigned,
_______ shares of the Common Stock ("Common Stock") of Perma-Tune
Electronics, Inc.
Payment of the purchase price per Share required under such Warrant
accompanies this subscription.
The undersigned hereby represents and warrants that the undersigned
understands the speculative nature of an investment in the Common Stock and
is willing to accept the risks involved in such investment.
Dated: __________________
Signature:__________________________
Address:__________________________
__________________________
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