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EXHIBIT 10.3
No sale, offer to sell or transfer of the securities represented by this
certificate or any interest therein shall be made unless a registration
statement under the Securities Act of 1933, as amended, with respect to such
transaction is then in effect, or the issuer has received an opinion of counsel
satisfactory to it that such transfer does not require registration under that
Act.
This Warrant will be void after 5:00 p.m. New York time on ________, 2005
(i.e. five years from the effective date of the Registration Statement).
REPRESENTATIVE'S WARRANT
WARRANT NO. 1
To Subscribe for and Purchase Shares of
AQUACELL TECHNOLOGIES, INC.
(Transferability Restricted as Provided in Section 8 Below)
THIS CERTIFIES THAT, for value received, _________________ or registered
assigns, is entitled to subscribe for and purchase from AQUACELL TECHNOLOGIES,
INC., incorporated under the laws of the State of Delaware (the "Company") up to
________ fully paid and non-assessable shares of Common Stock (the "Shares") of
the Company, as hereinafter defined, at the "Purchase Price" and during the
period hereinafter set forth, subject, however, to the provisions and upon the
terms and conditions hereinafter set forth. This Warrant is one of an issue of
the Company's Common Stock Purchase Warrants (herein called the "Warrants"),
identical in all respects except as to the names of the holders thereof and the
number of Shares purchasable thereunder, representing on the original issue
thereof rights to purchase up to an aggregate of 175,000 Shares.
1. As used herein:
(a) "Common Stock" or "Common Shares" shall initially refer to the
Company's Common Stock, $.001 par value, per share as more fully set forth in
Section 5 hereof.
(b) "Purchase Price" shall be $8.25 per share (165% of the public
offering price per share) which is subject to adjustment pursuant to Section 4
hereof.
(c) "Underwriter" or "Representative" shall refer to Grady & Hatch
and Company, Inc.
(d) "Underwriting Agreement" shall refer to the Underwriting
Agreement dated as of _____________, 2000 between the Company and the
Underwriter.
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(e) "Warrants" or "Representative's Warrants" shall refer to Warrants
to purchase an aggregate of up to 175,000 Shares issued to the Underwriter or
its designees by the Company pursuant to the Underwriting Agreement, as such may
be adjusted from time to time pursuant to the terms of Section 4 and including
any Warrants represented by any certificate issued from time to time in
connection with the transfer, partial exercise, exchange of any Warrants or in
connection with a lost, stolen, mutilated or destroyed Warrant certificate, if
any, or to reflect an adjusted number of Shares.
(f) "Underlying Securities" shall refer to and include the Common
Shares issuable or issued upon exercise of the Representative's Warrants.
(g) "Holders" shall mean the registered holder of such
Representative's Warrants or any issued Underlying Securities.
(h) "Effective Date" shall refer to the effective date of the Form
SB-2 Registration Statement File No. 333-41826 with the Securities and Exchange
Commission.
(i) "Transfer Agent" shall mean U.S. Stock Transfer Company.
2. The purchase rights represented by this Warrant may be exercised by
the holder hereof, in whole or in part at any time, and from time to time,
during the period commencing on the Effective Date until __________, 2005 (the
"Expiration Date"), by the presentation of this Warrant, with the purchase form
attached duly executed, at the Company's office (or such office or agency of the
Company as it may designate in writing to the Holder hereof by notice pursuant
to Section 15 hereof), and upon payment by the Holder to the Company in cash, or
by certified check or bank draft of the Purchase Price for such Shares of Common
Stock. The Company agrees that the Holder hereof shall be deemed the record
owner of such Underlying Securities as of the close of business on the date on
which this Warrant together with payment of the exercise price shall have been
presented to the Company. Certificates for the Underlying Securities so
purchased shall be delivered to the Holder hereof by the Transfer Agent within a
reasonable time, not exceeding five (5) days, after the rights represented by
this Warrant shall have been so exercised. If this Warrant shall be exercised
in part only, the Company shall, upon surrender of this Warrant for
cancellation, deliver a new Representative's Warrant evidencing the rights of
the Holder hereof to purchase the balance of the Shares which such Holder is
entitled to purchase hereunder. Exercise in full of the rights represented by
this Warrant shall not extinguish the rights granted under Section 9 hereof.
3. Subject to the provisions of Section 8 hereof, (i) this Warrant is
exchangeable at the option of the Holder at the aforesaid office of the Company
for other Representative's Warrants of different denominations entitling the
Holder thereof to purchase in the aggregate the same number of Shares of Common
Stock as are purchasable hereunder; and (ii) this Warrant may be divided or
combined with other Representative's Warrants which carry the same rights, in
either case, upon
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presentation hereof at the aforesaid office of the Company together with a
written notice, signed by the Holder hereof, specifying the names and
denominations in which new Representative's Warrants are to be issued, and the
payment of any transfer tax due in connection therewith.
4. Subject and pursuant to the provisions of this Section 4, the Purchase
Price and number of Common Shares subject to this Warrant shall be subject to
adjustment from time to time as set forth hereinafter.
(A) If the Company shall, at any time, subdivide its outstanding
Common Shares by recapitalization, reclassification, split up thereof, or other
such issuance without additional consideration, the appropriate Purchase Price
immediately prior to such subdivision shall be proportionately decreased, and if
the Company shall at any time combine the outstanding Common Shares by
recapitalization, reclassification or combination thereof, the Purchase Price
immediately prior to such combination shall be proportionately increased. Any
such adjustment to the Purchase Price or the corresponding adjustment to the
Purchase Price shall become effective at the close of business on the record
date for such subdivision or combination. No adjustment to the Purchase Price
and the number of shares issuable upon exercise of this Warrant shall be
required if such adjustment provides the holders of this Warrant with
disproportionate rights, privileges and economic benefits which are not provided
to the public shareholders.
(B) In the event that prior to the Representative's Warrant's
expiration date the Company adopts a resolution to merge, consolidate, or sell
percentages in all of its assets, each Warrant holder upon the exercise of his
Representative's Warrant will be entitled to receive the same treatment as a
holder of any other share of Common Stock. In the event the Company adopts a
resolution for the liquidation, dissolution, or winding up of the Company's
business, the Company will give written notice of such adoption of a resolution
to the registered holders of the Representative's Warrants. Thereupon all
liquidation and dissolution rights under this Warrant will terminate at the end
of thirty (30) days from the date of the notice to the extent not exercised
within those thirty (30) days.
(C) If any capital reorganization or reclassification of the capital
stock of the Company or consolidation or merger of the Company with another
corporation, shall be effected in such a way that holders of Common Stock shall
be entitled to receive stock, securities, cash or assets with respect to or in
exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, the Company or such successor
or purchasing corporation, as the case may be, shall be obligated to provide for
and notify each registered holder of the Representative's Warrant that such
holder shall have the right thereafter and until the expiration date to exercise
such Warrant for the kind and amount of stock, securities, cash or assets
receivable upon such reorganization, reclassification, consolidation, merger or
sale by a holder of the number of shares of Common Stock for the purchase of
which such Warrant might have been exercised immediately prior to such
reorganization, reclassification, consolidation, merger or sale, subject to
adjustments
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which shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Section 4.
(D) In case at any time the Company shall declare a dividend or make
any other distribution upon any stock of the Company payable in Common Stock,
then such Common Stock issuable in payment of such dividend or distribution
shall be deemed to have been issued or sold without consideration.
(E) Upon any adjustment of the appropriate respective Purchase Price
as hereinabove provided, the number of Common Shares issuable upon exercise of
each class of Warrant shall be changed to the number of shares determined by
dividing (i) the aggregate Purchase Price payable for the purchase of all shares
issuable upon exercise of that class of Warrant immediately prior to such
adjustment by (ii) the appropriate Purchase Price per share in effect
immediately after such adjustment.
(F) No adjustment in the Purchase Price shall be required under
Section 4 hereof unless such adjustment would require an increase or decrease in
such price of at least 1% provided, however, that any adjustments which by
reason of the foregoing are not required at the time to be made shall be carried
forward and taken into account and included in determining the amount of any
subsequent adjustment, and provided further, however, that in case the Company
shall at any time subdivide or combine the outstanding Common Shares as a
dividend, said amount of 1% per share shall forthwith be proportionately
increased in the case of a combination or decreased in the case of a subdivision
or stock dividend so as to appropriately reflect the same.
(G) On the effective date of any new Purchase Price the number of
shares as to which this Warrant may be exercised shall be increased or decreased
so that the total sum payable to the Company on the exercise of this Warrant
shall remain constant.
(H) The form of Representative's Warrant need not be changed because
of any change pursuant to this Article, and Representative's Warrants issued
after such change may state the Purchase Price and the same number of shares as
is stated in the Representative's Warrants initially issued pursuant to this
Warrant. However, the Company may at any time in its sole discretion (which
shall be conclusive) make any change in the form of Representative's Warrant
that the Company may deem appropriate and that does not affect the substance
thereof, and any Representative's Warrant thereafter issued or countersigned,
whether in exchange or substitution for an outstanding Warrant or otherwise, may
be in the form as so changed.
5. For the purposes of this Warrant, the terms "Common Shares" or "Common
Stock" shall mean (i) the class of stock designated as the Common Stock, $.001
par value, of the Company on the date set forth on the first page hereof or (ii)
any other class of stock resulting from successive changes or re-classifications
of such Common Stock consisting solely of changes in par value, or from no par
value to par value, or from par value to no par value. If at any time, as a
result of an adjustment made pursuant to Section 4, the securities or other
property obtainable upon exercise of
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this Warrant shall include shares or other securities of the Company other than
Common Shares or securities of another corporation or other property,
thereafter, the number of such other shares or other securities or property so
obtainable 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 Shares contained in Section 4 and all other provisions of this Warrant
with respect to Common Shares shall apply on like terms to any such other shares
or other securities or property. Subject to the foregoing, and unless the
context requires otherwise, all references herein to Common Shares shall, in the
event of an adjustment pursuant to Section 4, be deemed to refer also to any
other securities or property then obtainable as a result of such adjustments.
6. The Company covenants and agrees that:
(a) During the period within which the rights represented by the
Representative's Warrant may be exercised, the Company shall, at all times,
reserve and keep available out of its authorized capital stock, solely for the
purposes of issuance upon exercise of this Warrant, such number of its Common
Shares as shall be issuable upon the exercise of this Warrant and at its expense
will obtain the listing thereof on all national securities exchanges on which
the Common Shares are then listed; and if at any time the number of authorized
Common Shares shall not be sufficient to effect the exercise of this Warrant,
the Company will take such corporate action as may be necessary to increase its
authorized but unissued Common Shares to such number of shares as shall be
sufficient for such purpose; the Company shall have analogous obligations with
respect to any other securities or property issuable upon exercise of this
Warrant.
(b) All Common Shares which may be issued upon exercise of the rights
represented by this Warrant will, upon issuance be validly issued, fully paid,
nonassessable and free from all taxes, liens and charges with respect to the
issuance thereof.
(c) All original issue taxes payable in respect of the issuance of
Common Shares upon the exercise of the rights represented by this Warrant shall
be borne by the Company but in no event shall the Company be responsible or
liable for income taxes or transfer taxes upon the transfer of any
Representative's Warrants.
7. Until exercised, this Warrant shall not entitle the Holder hereof to
any voting rights or other rights as a shareholder of the Company, except that
the Holder of this Warrant shall be deemed to be a shareholder of this Company
for the purpose of bringing suit on the ground that the issuance of shares of
stock of the Company is improper under the New York Corporation Law.
8. This Warrant and the Underlying Securities shall not be sold,
transferred, assigned or hypothecated for a period of twelve (12) months from
the Effective Date, except to officers or partners of the Representative, and/or
the other underwriters and/or selected dealers who participated in such
offering, or the officers or partners of such
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underwriters and/or selected dealers. In no event shall this Warrant and the
Underlying Securities be sold, transferred, assigned or hypothecated except in
conformity with the applicable provisions of the Securities Act of 1933, as then
in force (the "Act"), or any similar Federal statute then in force, and all
applicable "Blue Sky" laws.
9. The Holder of this Warrant, by acceptance hereof, agrees that, prior
to the disposition of this Warrant or of any Underlying Securities theretofore
purchased upon the exercise hereof, under circumstances that might require
registration of such securities under the Act, or any similar federal statute
then in force, such Holder will give written notice to the Company expressing
such Holder's intention of effecting such disposition, and describing briefly
such Holder's intention as to the disposition to be made of this Warrant and/or
the Underlying Securities theretofore issued upon exercise hereof. Promptly
upon receiving such notice, the Company shall present copies thereof to its
counsel and the provisions of the following subdivisions shall apply:
(a) If, in the opinion of such counsel, the proposed disposition does
not require registration under the Act, or any similar federal statute then in
force, of this Warrant and/or the securities issuable or issued upon the
exercise of this Warrant, the Company shall, as promptly as practicable, notify
the Holder hereof of such opinion, whereupon such holder shall be entitled to
dispose of this Warrant and/or such Underlying Securities theretofore issued
upon the exercise hereof, all in accordance with the terms of the notice
delivered by such Holder to the Company.
(b) If, in the opinion of such counsel, such proposed disposition
requires such registration under the Act, or similar federal statute then in
effect, of this Warrant and/or the Underlying Securities issuable or issued upon
the exercise of this Warrant, the Company shall promptly give written notice of
such opinion to the Holder hereof and to the then holders of the securities
theretofore issued upon the exercise of this Warrant at the respective addresses
thereof shown on the books of the Company. The registration rights contained in
Section 15 of the Underwriting Agreement are incorporated by reference as if set
forth in their entirety herein.
10. The Company agrees to indemnify and hold harmless the holder of this
Warrant, or of securities issuable or issued upon the exercise hereof, from and
against any claims and liabilities caused by any untrue statement of a material
fact, or omission to state a material fact required to be stated, in any such
registration statement or prospectus except insofar as such claims or
liabilities are caused by any such untrue statement or omission based on
information furnished in writing to the Company by such holder, or by any other
such holder affiliated with the holder who seeks indemnification, as to which
the holder hereof, by acceptance hereof, agrees to indemnify and hold harmless
the Company.
11. If this Warrant, or any of the securities issuable pursuant hereto,
require qualification or registration with, or approval of, any governmental
official or authority (other than registration under the Act, or any similar
federal statute at the time in force), before such securities may be issued on
the exercise hereof, the Company, at its expense, will take all requisite action
in connection with such qualification, and will use
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its commercially reasonable efforts to cause such securities and/or this Warrant
to be duly registered or approved, as may be required.
12. This Warrant is exchangeable, upon its surrender by the registered
holder at such office or agency of the Company as may be designated by the
Company, for new Representative's Warrants of like tenor, representing, in the
aggregate, the right to subscribe for and purchase the number of Common Shares
that may be subscribed for and purchased hereunder, each of such new
Representative's Warrants to represent the right to subscribe for and purchase
such number of Common Shares as shall be designated by the registered holder at
the time of such surrender. Upon receipt of evidence satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant, and, in
the case of any such loss, theft or destruction, upon delivery of a bond of
indemnity satisfactory to the Company, or in the case of such mutilation, upon
surrender or cancellation of this Warrant, the Company will issue to the
registered holder a new Representative's Warrant of like tenor, in lieu of this
Warrant, representing the right to subscribe for and purchase the number of
Common Shares that may be subscribed for and purchased hereunder. Nothing
herein is intended to authorize the transfer of this Warrant except as permitted
under Section 8.
13. No fractional Common Shares shall be issued upon the exercise of this
Warrant. The Company shall round any fractional Common Shares issuable upon
exercise of this Warrant to the nearest whole Common Share.
14. Every holder hereof, by accepting the same, agrees with any subsequent
holder hereof and with the Company that this Warrant and all rights hereunder
are issued and shall be held subject to all of the terms, conditions,
limitations and provisions set forth in this Warrant, and further agrees that
the Company and its transfer agent may deem and treat the registered holder of
this Warrant as the absolute owner hereof for all purposes and shall not be
affected by any notice to the contrary.
15. All notices required hereunder shall be given by first-class mail,
postage prepaid; if given by the holder hereof, addressed to the Company at
10410 Trademark Street, Rancho Cucamonga, CA 91730 or such other address as the
Company may designate in writing to the holder hereof; and if given by the
Company, addressed to the holder at the address of the holder shown on the books
of the Company. The validity, construction and enforcement of this Warrant
shall be governed by the laws of the State of California and jurisdiction is
hereby vested in the Courts of said State in the event of the institution of any
legal action under this Warrant.
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IN WITNESS WHEREOF, AQUACELL TECHNOLOGIES, INC. has caused this Warrant to
be signed by its duly authorized officers under its corporate seal, to be dated
as of _______________, 2000.
(Corporate Seal) AQUACELL TECHNOLOGIES, INC.
By:____________________________
James C. Witham,
Chief Executive Officer
Attest:
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Karen B. Laustsen, President
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PURCHASE FORM
To Be Executed
Upon Exercise of Warrant
The undersigned hereby exercises the right to purchase ________ Common Shares
evidenced by the within Warrant, according to the terms and conditions thereof,
and herewith makes payment of the purchase price in full. The undersigned
requests that certificates for such shares shall be issued in the name set forth
below.
Dated: , 200__
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Signature
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Print Name of Signatory
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Name to whom certificates are to be issued if
different from above
Address: --------------------------------------
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Social Security No. or other identifying
number __________________
If said number of shares shall not be all the shares purchasable under the
within Warrant, the undersigned requests that a new Warrant for the unexercised
portion shall be registered in the name of:
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(Please Print)
Address: --------------------------------------
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Social Security No. or other identifying
number __________________
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Signature
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FORM OF ASSIGNMENT
FOR VALUE RECEIVED _________________________, hereby sells assigns and
transfers to ______________, Soc. Sec. No. [___________] the within Warrant,
together with all rights, title and interest therein, and does hereby
irrevocably constitute and appoint _______________________ attorney to transfer
such Warrant on the register of the within named Company, with full power of
substitution.
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Signature
Dated: , 200_
Signature Guaranteed:
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