Exhibit 4.1
PAW-
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF
HAVE BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION (THE "COMMISSION") OR THE SECURITIES COMMISSION OF ANY
STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER RULE 506 OF
REGULATION D PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO
SELL NOR A SOLICITATION OF AN OFFER TO BUY THE WARRANT OR THE
SECURITIES ISSUABLE UPON EXERCISE HEREOF IN ANY JURISDICTION IN WHICH
SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL.
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF
MAY BE SOLD, PLEDGED, TRANSFERRED OR ASSIGNED EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES LAWS, OR IN A TRANSACTION WHICH IS EXEMPT
FROM REGISTRATION UNDER THE PROVISIONS OF THE SECURITIES ACT AND UNDER
PROVISIONS OF APPLICABLE STATE SECURITIES LAWS AND IN THE CASE OF AN
EXEMPTION, ONLY IF THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL THAT
SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION OF THE WARRANT OR SUCH
SECURITIES, WHICH OPINION AND WHICH COUNSEL SHALL BE SATISFACTORY TO
THE COMPANY IN ITS SOLE DISCRETION.
WARRANT
To Purchase _________ Shares of Common Stock
and
Warrants to Purchase An Additional ______ Shares of Common Stock
of
MICROS-TO-MAINFRAMES, INC.
THIS CERTIFIES that, for value received, __________________ (the
"Holder"), is entitled, upon the terms and subject to the conditions
hereinafter set forth, at any time on or prior to 5:00 p.m., New York
City time on September 25, 2005 (the "Termination Date") but not
thereafter, to subscribe for and purchase from MICROS-TO-MAINFRAMES,
INC., a corporation incorporated in New York (the "Company"),
_______________ (______) shares (the "Warrant Shares") of common
stock, par value $0.001 per share, of the Company (the "Common Stock")
and warrants to purchase an additional ____ shares of Common Stock
(the "Additional Warrant Shares", and together with the Warrant
Shares, the "Shares"), in the form annexed hereto as Exhibit A (the
"Investor Warrants"). The Holder, upon exercise of this Warrant,
shall be entitled to receive an Investor Warrant to purchase one share
of Common Stock for each four shares of Common Stock for which this
Warrant is exercised. The purchase price of one share of Common
Stock (the "Exercise Price") under this Warrant shall be $ 5.00 per
share. The Exercise Price and the number of shares for which the
Warrant is exercisable shall be subject to adjustment as provided
herein.
1. Title of Warrant. Prior to the expiration hereof and
subject to compliance with applicable laws, this Warrant and all
rights hereunder are transferable, in whole or in part, at the office
or agency of the Company by the holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant together with the
Assignment Form annexed hereto properly endorsed.
2. Authorization of Shares. The Company covenants that
all shares of Common Stock which may be issued upon the exercise of
rights represented by this Warrant and the Investor Warrants will,
upon exercise of the rights represented by this Warrant and the
Investor Warrants, be duly authorized, validly issued, fully paid and
nonassessable and free from all taxes, liens and charges in respect of
the issue thereof (other than taxes in respect of any transfer
occurring contemporaneously with such issue).
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3. Exercise of Warrant. Except as provided in Section 4
herein, exercise of the purchase rights represented by this Warrant
may be made at any time or times, before the close of business on the
Termination Date, or such earlier date on which this Warrant may
terminate as provided in this Warrant, by the surrender of this
Warrant and the Notice of Exercise Form annexed hereto duly executed,
at the office of the Company (or such other office or agency of the
Company as it may designate by notice in writing to the registered
holder hereof at the address of such holder appearing on the books of
the Company) and upon payment of the Exercise Price of the shares and
Investor Warrants thereby purchased by cash, check, bank draft or by
wire transfer of funds to an account designated by the Company
whereupon the holder of this Warrant shall be entitled (subject to
collection of funds if payment is by check) to receive a certificate
for the number of shares of Common Stock and Investor Warrants so
purchased. This Warrant also may be exercised, in whole or in part,
by means of a "cashless exercise" by tendering this Warrant to the
Company for a number of shares of Common Stock having a Market Value
(as defined in Section 11(a)(vi) hereof) equal to the difference
between the Market Value of the shares of Common Stock issuable upon
such exercise of this Warrant and the total cash exercise price of
that part of the Warrant being exercised. This Warrant shall be
deemed to have been exercised and such certificate or certificates
shall be deemed to have been issued, and Holder or any other person so
designated to be named therein shall be deemed to have become a holder
of record of such shares for all purposes, as of the date the Warrant
has been exercised by payment to the Company of the Warrant purchase
price and all taxes required to be paid by Holder, if any, pursuant to
Section 5 prior to the issuance of such shares and Investor Warrants
have been paid. If this Warrant shall have been exercised in part,
the Company shall, at the time of delivery of the certificate or
certificates representing Warrant Shares and Investor Warrants,
deliver to Holder a new Warrant evidencing the rights of Holder to
purchase the unpurchased shares of Common Stock and Investor Warrants
called for by this Warrant, which new Warrant shall in all other
respects be identical with this Warrant.
4. No Fractional Shares or Scrip. No fractional shares or
scrip representing fractional shares or fractional Investor Warrants
shall be issued upon the exercise of this Warrant. As to any fraction
of a share which Holder would otherwise be entitled to purchase upon
such exercise, the Company shall pay a cash adjustment in respect of
such final fraction in an amount equal to the same fraction of the
closing market price per share of Common Stock on the date of exercise
of this Warrant. No adjustment shall be made in respect of fractional
Investor Warrants which the Holder would otherwise be entitled to
purchase upon exercise of this Warrant.
5. Charges, Taxes and Expenses. Issuance of certificates
for shares of Common Stock and Investor Warrants upon the exercise of
this Warrant shall be made without charge to the holder hereof for any
issue or transfer tax or other incidental expense in respect of the
issuance of such certificate, all of which taxes and expenses shall be
paid by the Company, and such certificates shall be issued in the name
of the holder of this Warrant or in such name or names as may be
directed by the holder of this Warrant; provided, however, that in the
event certificates for shares of Common Stock or Investor Warrants are
to be issued in a name other than the name of the holder of this
Warrant, this Warrant when surrendered for exercise shall be
accompanied by the Assignment Form attached hereto duly executed by
the holder hereof; and provided further, that upon any transfer
involved in the issuance or delivery of any certificates for shares of
Common Stock or Investor Warrants, the Company may require, as a
condition thereto, the payment of a sum sufficient to reimburse it for
any transfer tax incidental thereto.
6. Closing of Books. The Company will not close its
shareholder books or records in any manner which prevents the timely
exercise of this Warrant.
7. Transfer, Division and Combination. (a) Subject to
compliance with any applicable securities laws, transfer of this
Warrant and all rights hereunder, in whole or in part, shall be
registered on the books of the Company to be maintained for such
purpose, upon surrender of this Warrant at the principal office of the
Company, together with a written assignment of this Warrant
substantially in the form attached hereto duly executed by Holder or
its agent or attorney and funds sufficient to pay any transfer taxes
payable upon the making of such transfer. Upon such surrender and, if
required, such payment, the Company shall execute and deliver a new
Warrant or Warrants in the name of the assignee or assignees and in
the denomination specified in such instrument of assignment, and shall
issue to the assignor a new Warrant evidencing the portion of this
Warrant not so assigned, and this Warrant shall promptly be cancelled.
A Warrant, if properly assigned, may be exercised by a new Holder for
the purchase of shares of Common Stock and Investor Warrants without
having a new Warrant issued.
(b) This Warrant may be divided or combined with other
Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and
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denominations in which new Warrants are to be issued, signed by Holder
or its agent or attorney. Subject to compliance with Section 7(a), as
to any transfer which may be involved in such division or combination,
the Company shall execute and deliver a new Warrant or Warrants in
exchange for the Warrant or Warrants to be divided or combined in
accordance with such notice.
(c) The Company shall prepare, issue and deliver at
its own expense (other than transfer taxes) the new Warrant or
Warrants under this Section 7.
(d) The Company agrees to maintain, at its aforesaid
office, books for the registration and the registration of transfer of
the Warrants.
8. No Rights as Shareholder until Exercise. This Warrant
does not entitle the holder hereof to any voting rights or other
rights as a shareholder of the Company prior to the exercise thereof.
Upon the surrender of this Warrant and the payment of the aggregate
Exercise Price, the Warrant Shares and Investor Warrants so purchased
shall be deemed to be issued to such holder as the record owner of
such shares as of the close of business on the later of the date of
such surrender or payment.
9. Loss, Theft, Destruction or Mutilation of Warrant. The
Company represents and warrants that upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction
or mutilation of this Warrant certificate or any certificate relating
to the Warrant Shares or the Investor Warrants, and in case of loss,
theft or destruction, of indemnity or security reasonably satisfactory
to it, and upon surrender and cancellation of such Warrant or
certificate, if mutilated, the Company will make and deliver a new
Warrant or certificate of like tenor and dated as of such
cancellation, in lieu of such Warrant or certificate.
10. Saturdays, Sundays, Holidays, etc. If the last or
appointed day for the taking of any action or the expiration of any
right required or granted herein shall be a Saturday, Sunday or a
legal holiday, then such action may be taken or such right may be
exercised on the next succeeding day not a Saturday, Sunday or legal
holiday.
11. Adjustment of Exercise Price and Number of Warrant
Shares. The number and kind of securities purchasable upon the
exercise of this Warrant and the Exercise Price shall be subject to
adjustment from time to time upon the happening of any of the
following.
(a) Issuance or Sale of Common Stock. Except as hereinafter
provided, in case the Company shall, at any time after the date
hereof, issue or sell any shares of Common Stock (other than the
issuances or sales referred to in Section 11(f) hereof), including
shares held in the Company's treasury and shares of Common Stock
issued upon the exercise of any options, rights or warrants to
subscribe for shares of Common Stock (other than the issuances or
sales of Common Stock pursuant to rights to subscribe for such Common
Stock distributed pursuant to Paragraph 11(i) hereof) and shares of
Common Stock issued upon the direct or indirect conversion or exchange
of securities for shares of Common Stock, for a consideration per
share less than both the "Market Price" (as defined in Paragraph 11
(a)(vi) hereof) per share of Common Stock determined as of the trading
day immediately preceding such issuance or sale and the Exercise Price
in effect immediately prior to such issuance or sale, or without
consideration, then forthwith upon such issuance or sale, the Exercise
Price shall (until another such issuance or sale) be reduced to the
price (calculated to the nearest full cent) determined by multiplying
the Exercise Price in effect immediately prior to such issuance or
sale by a fraction, the numerator of which shall be the sum of (1) the
number of shares of Common Stock outstanding immediately prior to such
issuance or sale multiplied by the Exercise Price immediately prior to
such issuance or sale plus (2) the consideration received by the
Company upon such issuance or sale, and the denominator of which shall
be the product of (x) the total number of shares of Common Stock
outstanding immediately after such issuance or sale, multiplied by (y)
the Exercise Price immediately prior to such issuance or sale;
provided, however, that in no event shall the Exercise Price be
adjusted pursuant to this computation to an amount in excess of the
Exercise Price in effect immediately prior to such computation, except
in the case of a combination of outstanding shares of Common Stock, as
provided by Section 11(c) hereof. For the purposes of this Section
11, the term "Exercise Price" shall mean the exercise price of this
Warrant, as adjusted from time to time pursuant to the provisions of
his Section 11.
For the purposes of any computation to be made in accordance with this
Section 11(a), the following provisions shall be applicable:
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(i) In case of the issuance or sale of shares of Common
Stock for a consideration part or all of which shall be cash, the
amount of the cash consideration therefor shall be deemed to be the
amount of cash received by the Company for such shares (or, if shares
of Common Stock are offered by the Company for subscription, the
subscription price, or, if such securities shall be sold to
underwriters or dealers for a public offering without a subscription
offering, the public offering price) before deducting therefrom any
compensation paid or discount allowed in the sale, underwriting or
purchase thereof by underwriters or dealers or others performing
similar services, or any expenses incurred in connection therewith.
(ii) In case of the issuance or sale (otherwise than as a dividend or
other distribution on any stock of the Company) of shares of Common
Stock for a consideration part or all of which shall be other than
cash, the amount of the consideration therefor other than cash shall
be deemed to be the value of such consideration as determined in good
faith by the Board of Directors of the Company.
(iii) Shares of 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 day following
the record date for the determination of stockholders entitled to
receive such dividend or other distribution and shall be deemed to
have been issued without consideration.
(iv) The reclassification of securities of the Company other than
shares of Common Stock into securities including shares of Common
Stock shall be deemed to involve the issuance of such shares of Common
Stock for a consideration other than cash immediately prior to the
close of business on the date fixed for the determination of
securityholders entitled to receive such shares, and the value of the
consideration allocable to such shares of Common Stock shall be
determined as provided in subparagraph (ii) of this Section 11(a).
(v) The number of shares of Common Stock at any one time outstanding
shall include the aggregate number of shares issued or issuable upon
the exercise of options, rights or warrants and upon the conversion or
exchange of convertible or exchangeable securities.
(vi) As used herein, the phrase "Market Price" at any date shall be
deemed to be the average of the last reported sale price, or, in case
no such reported sale takes place on such day, the average of the last
reported sale prices for the last five trading days, in either case as
officially reported by the principal securities exchange on which the
Common Stock is listed or admitted to trading or as reported on the
Nasdaq Stock Market, or, if the Common Stock is not listed or admitted
to trading on any national securities exchange or quoted on the Nasdaq
Stock Market, the closing bid quotation on the OTC Bulletin Board or
otherwise in the over-the-counter market as furnished by the National
Association of Securities Dealers, Inc. through Nasdaq or a similar
organization if Nasdaq is no longer reporting such information, or if
the Common Stock is not quoted on Nasdaq or the OTC Bulletin Board, as
determined in good faith by resolution of the Board of Directors of
the Company, based on the best information available to it for the day
immediately preceding such issuance or sale. If the Common Stock is
listed or admitted to trading on a national securities exchange and
also quoted on the Nasdaq Stock Market, the Market Price shall be
determined as hereinabove provided by reference to the prices reported
in the Nasdaq Stock Market; provided that if the Common Stock is
listed or admitted to trading on the New York Stock Exchange, the
Market Price shall be determined as hereinabove provided by reference
to the prices reported by such exchange.
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(b) Options, Rights, Warrants and Convertible and
Exchangeable Securities. Except in the case of the Company issuing
rights to subscribe for shares of Common Stock distributed pursuant to
Section 11(i) hereof, if the Company shall at any time after the date
hereof issue options, rights or warrants to subscribe for shares of
Common Stock, or issue any securities convertible into or exchangeable
for shares of Common Stock, in each case other than the issuances or
sales referred to in Section 11(f) hereof, (i) for a consideration per
share less than the lesser of (a) the Exercise Price in effect
immediately prior to the issuance of such options, rights or warrants,
or such convertible or exchangeable securities, or (b) the Market
Price determined as of the trading day immediately preceding such
issuance, or (ii) without consideration, the Exercise Price in effect
immediately prior to the issuance of such options, rights or warrants,
or such convertible or exchangeable securities, as the case may be,
shall be reduced to a price determined by making a computation in
accordance with the provisions of Section 11(a) hereof, provided that:
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(i) The aggregate maximum number of shares of Common
Stock, as the case may be, issuable under all the outstanding options,
rights or warrants shall be deemed to be issued and outstanding at the
time all the outstanding options, rights or warrants were issued, and
for a consideration equal to the minimum purchase price per share
provided for in the options, rights or warrants at the time of
issuance, plus the consideration (determined in the same manner as
consideration received on the issue or sale of shares in accordance
with the terms of Section 11(a) hereof), if any, received by the
Company for the options, rights or warrants, and if no minimum
purchase price is provided in the options, rights or warrants, then
the minimum purchase price shall be equal to zero; provided, however,
that upon the expiration or other termination of the options, rights
or warrants, if any thereof shall not have been exercised, the number
of shares of Common Stock deemed to be issued and outstanding pursuant
to this Section 11(b) (and for the purposes of subparagraph (v) of
Section 11(a) hereof) shall be reduced by such number of shares as to
which options, warrants and/or rights shall have expired or terminated
unexercised, and such number of shares shall no longer be deemed to be
issued and outstanding, and the Exercise Price then in effect shall
forthwith be readjusted and thereafter be the price which it would
have been had adjustment been made on the basis of the issuance only
of shares actually issued or issuable upon the exercise of those
options, rights or warrants as to which the exercise rights shall not
have expired or terminated unexercised.
(ii) The aggregate maximum number of shares of Common Stock issuable
upon conversion or exchange of any convertible or exchangeable
securities shall be deemed to be issued and outstanding at the time of
issuance of such securities, and for a consideration equal to the
consideration (determined in the same manner as consideration received
on the issue or sale of shares of Common Stock in accordance with the
terms of Section 11 (a) hereof) received by the Company for such
securities, plus the minimum consideration, if any, receivable by the
Company upon the conversion or exchange thereof; provided, however,
that upon the expiration or other termination of the right to convert
or exchange such convertible or exchangeable securities (whether by
reason of redemption or otherwise), the number of shares deemed to be
issued and outstanding pursuant to this subparagraph (ii) (and for the
purpose of subparagraph (v) of Section 11(a) hereof) shall be reduced
by such number of shares as to which the conversion or exchange rights
shall have expired or terminated unexercised, and such number of
shares shall no longer be deemed to be issued and outstanding, and the
Exercise Price then in effect shall forthwith be readjusted and
thereafter be the price which it would have been had adjustment been
made on the basis of the issuance only of the shares actually issued
or issuable upon the conversion or exchange of those convertible or
exchangeable securities as to which the conversion or exchange rights
shall not have expired or terminated unexercised. No adjustment will
be made pursuant to this subparagraph (ii) upon the issuance by the
Company of any convertible or exchangeable securities pursuant to the
exercise of any option, right or warrant exercisable therefor, to the
extent that adjustments in respect of such options, rights or warrants
were previously made pursuant to the provisions of subparagraph (i) of
this Section 11(b).
(iii) If any change shall occur in the price per share provided for in
any of the options, rights or warrants referred to in subparagraph (i)
of this Section 11(b), or in the price per share at which the
securities referred to in subparagraph (ii) of this Section 11(b) are
convertible or exchangeable, or if any such options, rights or
warrants are exercised at a price greater than the minimum purchase
price provided for in such options, rights or warrants, or any such
securities are converted or exercised for more than the minimum
consideration receivable by the Company upon such conversion or
exchange, the options, rights or warrants or conversion or exchange
rights, as the case may be, shall be deemed to have expired or
terminated on the date when such price change became effective in
respect of shares not theretofore issued pursuant to the exercise or
conversion or exchange thereof, and the Company shall be deemed to
have issued upon such date new options, rights or warrants or
convertible or exchangeable securities at the new price with respect
of the number of shares issuable upon the exercise of such options,
rights or warrants or the conversion or exchange of such convertible
or exchangeable securities; provided, however, that no adjustment
shall be made pursuant to this subparagraph (iii) with respect to any
change in the price per share provided for in any of the options,
rights or warrants referred to in subparagraph (i) of this Section
11(b), or in the price per share at which the securities referred to
in subparagraph (ii) of this Section 11(b) are convertible or
exchangeable, which change results from the application of the anti-
dilution provisions thereof in connection with an event for which,
subject to subparagraph (iv) of Section 11(f), an adjustment to the
Exercise Price and the number of securities issuable upon exercise of
this Warrant will be required to be made pursuant to this Section 11.
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(c) Subdivision and Combination. In case the Company
shall at any time after the date hereof subdivide or combine the
outstanding shares of Common Stock, the Exercise Price shall forthwith
be proportionately decreased in the case of subdivision or increased
in the case of combination.
(d) Adjustment in Number of Warrant Shares. Upon each adjustment of
the Exercise Price pursuant to the provisions of this Section 11, the
number of shares of Common Stock issuable upon the exercise of this
Warrant shall be adjusted to the nearest full whole number by
multiplying a number equal to the Exercise Price in effect immediately
prior to such adjustment by the number of shares of Common Stock
issuable upon exercise of this Warrant immediately prior to such
adjustment and dividing the product so obtained by the adjusted
Exercise Price.
(e) Reclassification, Consolidation, Merger, etc. In case of any
reclassification or change of the outstanding shares of Common Stock
(other than a change in par value to no par value, or from no par
value to par value, or as a result of a subdivision or combination),
or in the case of any consolidation of the Company with, or merger of
the Company into, another corporation (other than a consolidation or
merger which does not result in any reclassification or change of the
outstanding shares of Common Stock, except a change as a result of a
subdivision or combination of such shares or a change in par value, as
aforesaid), or in the case of a sale or conveyance to another
corporation of the property of the Company as an entirety, the Holder
shall thereafter have the right to purchase the kind and number of
shares of stock and other securities and property receivable upon such
reclassification, change, consolidation, merger, sale or conveyance as
if the Holder were the owner of the shares of Common Stock underlying
this Warrant immediately prior to any such events at a price equal to
the product of (x) the number of shares of Common Stock issuable upon
exercise of this Warrant and (y) the Exercise Price in effect
immediately prior to the record date for such reclassification,
change, consolidation, merger, sale or conveyance as if such Holder
had exercised this Warrant.
(f) No Adjustment of Exercise Price in Certain Cases.
Notwithstanding anything herein to the contrary, no adjustment of the
Exercise Price shall be made:
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(i) Upon the issuance of the shares of Common Stock that
may be acquired upon the exercise of warrants to purchase an aggregate
of 6,000 shares of Common Stock, identical to the Investor Warrants,
which warrants may be acquired upon exercise of this Warrant and like
warrants issued to designees of Sunrise Securities Corp. issued on the
date hereof; or
(ii) Upon (i) the issuance of options pursuant to the Company's stock
option plans in effect on the date hereof or as hereafter amended in
accordance with the terms thereof or any other employee or executive
stock option or award plan approved by stockholders of the Company or
the sale by the Company of any shares of Common Stock pursuant to the
exercise of any such options, or (ii) the sale by the Company of any
shares of Common Stock pursuant to the exercise of any options or
warrants issued and outstanding on the date hereof.
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(g) Adjustment of Investor Warrants Underlying. With
respect to the Investor Warrants that may be acquired upon exercise of
this Warrant, the exercise price of the Investor Warrants and the
number of shares of Common Stock and other securities purchasable
pursuant to the Investor Warrants shall be adjusted in accordance with
the terms and provisions of the Investor Warrants, upon the
occurrence, at any time after the date hereof, of any of the events
described in the Investor Warrant requiring such adjustment, with the
same force and effect as if the Investor Warrants had been issued as
of this date, whether or not the Investor Warrants shall have been
exercised at the time of the occurrence of such event and whether or
not the Investor Warrants shall be issued and outstanding at the time
of the occurrence of such event. Thereafter, the Investor Warrants
shall be exercisable at such adjusted exercise price for such
adjusted number of shares of Common Stock or other securities,
properties or rights as provided for in the Investor Warrants.
(h) Dividends and Other Distributions with Respect to
Outstanding Securities. In the event that the Company shall at any
time after the date hereof and prior to the exercise and expiration of
this Warrant declare a dividend (other than a dividend consisting
solely of shares of Common Stock or a cash dividend or distribution
payable out of current or retained earnings) or otherwise distribute
to the holders of Common Stock any monies, assets, property, rights,
evidences of indebtedness, securities (other than such a cash dividend
or distribution or dividend consisting solely of shares of Common
Stock), whether issued by the Company or by another person or entity,
or any other thing of value, the Holder of this Warrant shall
thereafter be entitled, in addition to the shares of Common Stock or
other securities receivable upon the exercise thereof, to receive,
upon the exercise of this Warrant, the same monies, property, assets,
rights, evidences of indebtedness, securities or any other thing of
value that the Holder would have been entitled to receive at the time
of such dividend or distribution as if the Holder was the owner of the
shares of Common Stock underlying this Warrant. At the time of any
such dividend or distribution, the Company shall make appropriate
reserves to ensure the timely performance of the provisions of this
Section 11(h).
(i) Subscription Rights for Shares of Common Stock or Other
Securities. In case the Company shall at any time after the date
hereof and prior to the exercise of this Warrant in full issue any
rights to subscribe for shares of Common Stock or any other securities
of the Company to all the holders of Common Stock, the Holder of this
Warrant shall be entitled, in addition to the shares of Common Stock
or other securities receivable upon the exercise of this Warrant, to
receive such rights at the time such rights are distributed to the
other stockholders of the Company but only to the extent of the number
of shares of Common Stock, if any, for which this Warrant remains
exercisable.
(j) Notice in Event of Dissolution. In case of the
dissolution, liquidation or winding-up of the Company, all rights
under this Warrant 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 registered Holder
of this Warrant, as the same shall appear on the books and records of
the Company, by registered mail at least thirty (30) days prior to
such termination date.
12. Voluntary Adjustment by the Company. The Company may
at any time during the term of this Warrant, reduce the then current
Exercise Price to any amount and for any period of time deemed
appropriate by the Board of Directors of the Company.
13. Notice of Adjustment. Whenever the number of Warrant
Shares or number or kind of securities or other property purchasable
upon the exercise of this Warrant or the Exercise Price is adjusted,
as herein provided, the Company shall promptly mail by registered or
certified mail, return receipt requested, to the holder of this
Warrant notice of such adjustment or adjustments setting forth the
number of Warrant Shares (and other securities or property)
purchasable upon the exercise of this Warrant and the Exercise Price
of such Warrant Shares (and other securities or property) after such
adjustment, setting forth a brief statement of the facts requiring
such adjustment and setting forth the computation by which such
adjustment was made. Such notice, in absence of manifest error, shall
be conclusive evidence of the correctness of such adjustment.
14. Notice of Corporate Action. If at any time
(a) the Company shall take a record of the holders of
its Common Stock for the purpose of entitling them to receive a
dividend or other distribution, or any right to subscribe for or
purchase any evidences of its indebtedness, any shares of stock of any
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class or any other securities or property, or to receive any other
right, or
(b) there shall be any capital reorganization of the
Company, any reclassification or recapitalization of the capital stock
of the Company or any consolidation or merger of the Company with, or
any sale, transfer or other disposition of all or substantially all
the property, assets or business of the Company to, another
corporation or,
(c) 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 to Holder (i) at
least 30 days' prior written notice of the date on which a record date
shall be selected for such dividend, distribution or right or for
determining rights to vote in respect of any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
liquidation or winding up, and (ii) in the case of any such
reorganization, reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up, at
least 30 days' prior written notice of the date when the same shall
take place. Such notice in accordance with the foregoing clause also
shall specify (i) the date on which any such record is to be taken for
the purpose of such dividend, distribution or right, the date on which
the holders of Common Stock shall be entitled to any such dividend,
distribution or right, and the amount and character thereof, and (ii)
the date on which any such reorganization, reclassification, merger,
consolidation, sale, transfer, disposition, dissolution, liquidation
or winding up is to take place and the time, if any such time is to be
fixed, as of which the holders of Common Stock shall be entitled to
exchange their shares of Common Stock for securities or other property
deliverable upon such disposition, dissolution, liquidation or winding
up. Each such written notice shall be sufficiently given if addressed
to Holder at the last address of Holder appearing on the books of the
Company and delivered in accordance with Section 16(d).
15. Authorized Shares. The Company covenants that during
the period the Warrant is outstanding, it will reserve from its
authorized and unissued Common Stock a sufficient number of shares to
provide for the issuance of Shares upon the exercise of any purchase
rights under this Warrant. The Company further covenants that its
issuance of this Warrant shall constitute full authority to its
officers who are charged with the duty of executing stock certificates
to execute and issue the necessary certificates for the Shares upon
the exercise of the purchase rights under this Warrant. The Company
will take all such reasonable action as may be necessary to assure
that such Shares may be issued as provided herein without violation of
any applicable law or regulation, or of any requirements of NASDAQ or
any domestic securities exchange upon which the Common Stock may be
listed.
The Company shall not by any action, including, without
limitation, amending its certificate of incorporation or through any
reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary
action, avoid or seek to avoid the observance or performance of any of
the terms of this Warrant, but will at all times in good faith assist
in the carrying out of all such terms and in the taking of all such
actions as may be necessary or appropriate to protect the rights of
Holder against impairment. Without limiting the generality of the
foregoing, the Company will (a) not increase the par value of any
shares of Common Stock receivable upon the exercise of this Warrant or
the Investor Warrants above the amount payable therefor upon such
exercise immediately prior to such increase in par value, (b) take all
such action as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and nonassessable
shares of Common Stock upon the exercise of this Warrant and the
Investor Warrants, and (c) use its best efforts to obtain all such
authorizations, exemptions or consents from any public regulatory body
having jurisdiction thereof as may be necessary to enable the Company
to perform its obligations under this Warrant and the Investor
Warrants.
Upon the request of Holder, the Company will at any time
during the period this Warrant is outstanding acknowledge in writing,
in form reasonably satisfactory to Holder, the continuing validity of
this Warrant and the obligations of the Company hereunder.
Before taking any action which would cause an adjustment
reducing the current Exercise Price below the then par value, if any,
of the shares of Common Stock issuable upon exercise of the Warrants,
the Company shall take any corporate action which may be necessary in
order that the Company may validly and legally issue fully paid and
non-assessable shares of such Common Stock at such adjusted Exercise
Price.
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<PAGE>
Before taking any action which would result in an
adjustment in the number of shares of Common Stock for which this
Warrant is exercisable or in the Exercise Price, the Company shall
obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies
having jurisdiction thereof.
16. Miscellaneous.
(a) Issue Date; Jurisdiction. The provisions of this
Warrant shall be construed and shall be given effect in all respects
as if it had been issued and delivered by the Company on the date
hereof. This Warrant shall be binding upon any successors or assigns
of the Company. This Warrant shall constitute a contract under the
laws of New York without regard to its conflict of law, principles or
rules, and be subject to arbitration pursuant to the terms set forth
in the Agreement.
(b) Restrictions. The holder hereof acknowledges
that the Warrant Shares acquired upon the exercise of this Warrant, if
not registered, will have restrictions upon resale imposed by state
and federal securities laws.
(c) Nonwaiver and Expenses. No course of dealing or
any delay or failure to exercise any right hereunder on the part of
Holder shall operate as a waiver of such right or otherwise prejudice
Holder's rights, powers or remedies, notwithstanding all rights
hereunder terminate on the Termination Date. If the Company fails to
make, when due, any payments provided for hereunder, or fails to
comply with any other provision of this Warrant, the Company shall pay
to Holder such amounts as shall be sufficient to cover any costs and
expenses including, but not limited to, reasonable attorneys' fees,
including those of appellate proceedings, incurred by Holder in
collecting any amounts due pursuant hereto or in otherwise enforcing
any of its rights, powers or remedies hereunder.
(d) Notices. Any notice, request or other document
required or permitted to be given or delivered to the holder hereof by
the Company shall be delivered in accordance with the notice
provisions of the subscription agreement between the Holder and the
Company.
(e) Limitation of Liability. No provision hereof, in
the absence of affirmative action by Holder to purchase shares of
Common Stock, and no enumeration herein of the rights or privileges of
Holder hereof, shall give rise to any liability of Holder for the
purchase price of any Common Stock or as a stockholder of the Company,
whether such liability is asserted by the Company or by creditors of
the Company.
(f) Remedies. Holder, in addition to being entitled
to exercise all rights granted by law, including recovery of damages,
will be entitled to specific performance of its rights under this
Warrant. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by
it of the provisions of this Warrant and hereby agrees to waive the
defense in any action for specific performance that a remedy at law
would be adequate.
(g) Successors and Assigns. Subject to applicable
securities laws, this Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the
Company and the successors and assigns of Holder. The provisions of
this Warrant are intended to be for the benefit of all Holders from
time to time of this Warrant and shall be enforceable by any such
Holder or holder of Warrant Stock.
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<PAGE>
(h) Cooperation. The Company shall cooperate with
Holder in supplying such information as may be reasonably necessary
for Holder to complete and file any information reporting forms
presently or hereafter required by the Commission as a condition to
the availability of an exemption from the Securities Act for the sale
of any Warrant or Common Stock.
(i) Indemnification. The Company agrees to indemnify
and hold harmless Holder from and against any liabilities,
obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs, attorneys' fees, expenses and disbursements of any kind
which may be imposed upon, incurred by or asserted against Holder in
any manner relating to or arising out of any failure by the Company to
perform or observe in any material respect any of its covenants,
agreements, undertakings or obligations set forth in this Warrant;
provided, however, that the Company will not be liable hereunder to
the extent that any liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, claims, costs, attorneys' fees,
expenses or disbursements are found in a final non-appealable judgment
by a court to have resulted from Holder's negligence, bad faith or
willful misconduct in its capacity as a stockholder or warrantholder
of the Company.
(j) Amendment. This Warrant and all other Warrants
may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder.
(k) Severability. Wherever possible, each provision
of this Warrant shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this Warrant
shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
(l) Headings. The headings used in this Warrant are
for the convenience of reference only and shall not, for any purpose,
be deemed a part of this Warrant.
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IN WITNESS WHEREOF, the Company has caused this Warrant to
be executed by its officer thereunto duly authorized.
Dated: September 26, 2000
MICROS-TO-MAINFRAMES, INC.
By:
____________________
Steven H. Rothman
Chief Executive Officer and President
<PAGE>
NOTICE OF EXERCISE
To: MICROS-TO-MAINFRAMES, INC.
(1) The undersigned hereby elects to purchase ________
shares of Common Stock, par value $0.001 per share (the "Common
Stock"), of MICROS-TO-MAINFRAMES, INC. and warrants to purchase an
additional ____ shares of Common Stock pursuant to the terms of the
attached Warrant, and
- tenders herewith payment of the exercise price in full
together with all applicable transfer taxes, if any; or
- tenders the Warrant for cashless exercise
(2) Calculation of cashless exercise value, if applicable:
(3) Please issue a certificate or certificates
representing said shares of Common Stock and Warrants in the name of
the undersigned or in such other name as is specified below:
_______________________________
(Name)
_______________________________
(Address)
_______________________________
Dated:
______________________________
Signature
<PAGE>
ASSIGNMENT FORM
(To assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to exercise the warrant.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights
evidenced thereby are hereby assigned to_______________________
_______________________________________________ whose address is
_______________________________________________________________.
_______________________________________________________________
Dated: ________________________,
Holder's Signature: _____________________________
Holder's Address: _____________________________
_____________________________
Signature Guaranteed: ___________________________________________
NOTE: The signature to this Assignment Form must correspond with the
name as it appears on the face of the Warrant, without alteration or
enlargement or any change whatsoever, and must be guaranteed by a bank
or trust company. Officers of corporations and those acting in an
fiduciary or other representative capacity should file proper evidence
of authority to assign the foregoing Warrant.
<PAGE>
EXHIBIT A
W-
NEITHER THIS WARRANT NOR THE SHARES ISSUABLE UPON EXERCISE HEREOF HAVE
BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION (THE "COMMISSION") OR THE SECURITIES COMMISSION OF ANY
STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER RULE 506 OF
REGULATION D PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO
SELL NOR A SOLICITATION OF AN OFFER TO BUY THE WARRANT OR THE SHARES
ISSUABLE UPON EXERCISE HEREOF IN ANY JURISDICTION IN WHICH SUCH OFFER
OR SOLICITATION WOULD BE UNLAWFUL.
NEITHER THIS WARRANT NOR THE SHARES ISSUABLE UPON EXERCISE HEREOF MAY
BE SOLD, PLEDGED, TRANSFERRED OR ASSIGNED EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES LAWS, OR IN A TRANSACTION WHICH IS EXEMPT
FROM REGISTRATION UNDER THE PROVISIONS OF THE SECURITIES ACT AND UNDER
PROVISIONS OF APPLICABLE STATE SECURITIES LAWS AND IN THE CASE OF AN
EXEMPTION, ONLY IF THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL THAT
SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION OF THE WARRANT OR SUCH
SHARES, WHICH OPINION AND WHICH COUNSEL SHALL BE SATISFACTORY TO THE
COMPANY IN ITS SOLE DISCRETION.
STOCK PURCHASE WARRANT
To Purchase _________ Shares of Common Stock of
MICROS-TO-MAINFRAMES, INC.
THIS CERTIFIES that, for value received, ________________ (the
"Holder"), is entitled, upon the terms and subject to the conditions
hereinafter set forth, at any time on or prior to 5:00 p.m., New York
City time on September 25, 2005 (the "Termination Date") but not
thereafter, to subscribe for and purchase from MICROS-TO-MAINFRAMES,
INC., a corporation incorporated in New York (the
"Company"),___________________ shares (the "Warrant Shares") of common
stock, par value $0.001 per share of the Company (the "Common Stock").
The purchase price of one share of Common Stock (the "Exercise Price")
under this Warrant shall be $ 5.00 per share. The Exercise Price and
the number of shares for which the Warrant is exercisable shall be
subject to adjustment as provided herein.
1. Title of Warrant. Prior to the expiration hereof and
subject to compliance with applicable laws, this Warrant and all
rights hereunder are transferable, in whole or in part, at the office
or agency of the Company by the holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant together with the
Assignment Form annexed hereto properly endorsed.
2. Authorization of Shares. The Company covenants that
all shares of Common Stock which may be issued upon the exercise of
rights represented by this Warrant will, upon exercise of the rights
represented by this Warrant, be duly authorized, validly issued, fully
paid and nonassessable and free from all taxes, liens and charges in
respect of the issue thereof (other than taxes in respect of any
transfer occurring contemporaneously with such issue).
3. Exercise of Warrant. Except as provided in Section 4
herein, exercise of the purchase rights represented by this Warrant
may be made at any time or times, before the close of business on the
Termination Date, or such earlier date on which this Warrant may
terminate as provided in this Warrant, by the surrender of this
Warrant and the Notice of Exercise Form annexed hereto duly executed,
at the office of the Company (or such other office or agency of the
Company as it may designate by notice in writing to the registered
holder hereof at the address of such holder appearing on the books of
the Company) and upon payment of the Exercise Price of the shares
1
<PAGE>
thereby purchased by cash, check, bank draft or by wire transfer of
funds to an account designated by the Company whereupon the holder of
this Warrant shall be entitled (subject to collection of funds if
payment is by check) to receive a certificate for the number of shares
of Common Stock so purchased. This Warrant shall be deemed to have
been exercised and such certificate or certificates shall be deemed to
have been issued, and Holder or any other person so designated to be
named therein shall be deemed to have become a holder of record of
such shares for all purposes, as of the date the Warrant has been
exercised by payment to the Company of the Warrant purchase price and
all taxes required to be paid by Holder, if any, pursuant to Section 5
prior to the issuance of such shares have been paid. If this Warrant
shall have been exercised in part, the Company shall, at the time of
delivery of the certificate or certificates representing Warrant
Shares, deliver to Holder a new Warrant evidencing the rights of
Holder to purchase the unpurchased shares of Common Stock called for
by this Warrant, which new Warrant shall in all other respects be
identical with this Warrant.
4. No Fractional Shares or Scrip. No fractional shares or
scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which Holder would
otherwise be entitled to purchase upon such exercise, the Company
shall pay a cash adjustment in respect of such final fraction in an
amount equal to the same fraction of the closing market price per
share of Common Stock on the date of exercise of this Warrant.
5. Charges, Taxes and Expenses. Issuance of certificates
for shares of Common Stock upon the exercise of this Warrant shall be
made without charge to the holder hereof for any issue or transfer tax
or other incidental expense in respect of the issuance of such
certificate, all of which taxes and expenses shall be paid by the
Company, and such certificates shall be issued in the name of the
holder of this Warrant or in such name or names as may be directed by
the holder of this Warrant; provided, however, that in the event
certificates for shares of Common Stock are to be issued in a name
other than the name of the holder of this Warrant, this Warrant when
surrendered for exercise shall be accompanied by the Assignment Form
attached hereto duly executed by the holder hereof; and provided
further, that upon any transfer involved in the issuance or delivery
of any certificates for shares of Common Stock, the Company may
require, as a condition thereto, the payment of a sum sufficient to
reimburse it for any transfer tax incidental thereto.
6. Closing of Books. The Company will not close its
shareholder books or records in any manner which prevents the timely
exercise of this Warrant.
7. Transfer, Division and Combination. (a) Subject to
compliance with any applicable securities laws, transfer of this
Warrant and all rights hereunder, in whole or in part, shall be
registered on the books of the Company to be maintained for such
purpose, upon surrender of this Warrant at the principal office of the
Company, together with a written assignment of this Warrant
substantially in the form attached hereto duly executed by Holder or
its agent or attorney and funds sufficient to pay any transfer taxes
payable upon the making of such transfer. Upon such surrender and, if
required, such payment, the Company shall execute and deliver a new
Warrant or Warrants in the name of the assignee or assignees and in
the denomination specified in such instrument of assignment, and shall
issue to the assignor a new Warrant evidencing the portion of this
Warrant not so assigned, and this Warrant shall promptly be cancelled.
A Warrant, if properly assigned, may be exercised by a new Holder for
the purchase of shares of Common Stock without having a new Warrant
issued.
(b) This Warrant may be divided or combined with other
Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and
denominations in which new Warrants are to be issued, signed by Holder
or its agent or attorney. Subject to compliance with Section 7(a), as
to any transfer which may be involved in such division or combination,
the Company shall execute and deliver a new Warrant or Warrants in
exchange for the Warrant or Warrants to be divided or combined in
accordance with such notice.
(c) The Company shall prepare, issue and deliver at
its own expense (other than transfer taxes) the new Warrant or
Warrants under this Section 7.
(d) The Company agrees to maintain, at its aforesaid
office, books for the registration and the registration of transfer of
the Warrants.
2
<PAGE>
8. No Rights as Shareholder until Exercise. This Warrant
does not entitle the holder hereof to any voting rights or other
rights as a shareholder of the Company prior to the exercise thereof.
Upon the surrender of this Warrant and the payment of the aggregate
Exercise Price, the Warrant Shares so purchased shall be and be deemed
to be issued to such holder as the record owner of such shares as of
the close of business on the later of the date of such surrender or
payment.
9. Loss, Theft, Destruction or Mutilation of Warrant. The
Company represents and warrants that upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction
or mutilation of this Warrant certificate or any stock certificate
relating to the Warrant Shares, and in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to it,
and upon surrender and cancellation of such Warrant or stock
certificate, if mutilated, the Company will make and deliver a new
Warrant or stock certificate of like tenor and dated as of such
cancellation, in lieu of such Warrant or stock certificate.
10. Saturdays, Sundays, Holidays, etc. If the last or
appointed day for the taking of any action or the expiration of any
right required or granted herein shall be a Saturday, Sunday or a
legal holiday, then such action may be taken or such right may be
exercised on the next succeeding day not a Saturday, Sunday or legal
holiday.
3
<PAGE>
11. Adjustment of Exercise Price and Number of Warrant Shares. The
number and kind of securities purchasable upon the exercise of this
Warrant and the Exercise Price shall be subject to adjustment from
time to time upon the happening of any of the following.
(a) Issuance or Sale of Common Stock. Except as hereinafter
provided, in case the Company shall, at any time after the date
hereof, issue or sell any shares of Common Stock (other than the
issuances or sales referred to in Section 11(f) hereof), including
shares held in the Company's treasury and shares of Common Stock
issued upon the exercise of any options, rights or warrants to
subscribe for shares of Common Stock (other than the issuances or
sales of Common Stock pursuant to rights to subscribe for such Common
Stock distributed pursuant to Paragraph 11(i) hereof) and shares of
Common Stock issued upon the direct or indirect conversion or exchange
of securities for shares of Common Stock, for a consideration per
share less than both the "Market Price" (as defined in Paragraph 11
(a)(vi) hereof) per share of Common Stock determined as of the trading
day immediately preceding such issuance or sale and the Exercise Price
in effect immediately prior to such issuance or sale, or without
consideration, then forthwith upon such issuance or sale, the Exercise
Price shall (until another such issuance or sale) be reduced to the
price (calculated to the nearest full cent) determined by multiplying
the Exercise Price in effect immediately prior to such issuance or
sale by a fraction, the numerator of which shall be the sum of (1) the
number of shares of Common Stock outstanding immediately prior to such
issuance or sale multiplied by the Exercise Price immediately prior to
such issuance or sale plus (2) the consideration received by the
Company upon such issuance or sale, and the denominator of which shall
be the product of (x) the total number of shares of Common Stock
outstanding immediately after such issuance or sale, multiplied by (y)
the Exercise Price immediately prior to such issuance or sale;
provided, however, that in no event shall the Exercise Price be
adjusted pursuant to this computation to an amount in excess of the
Exercise Price in effect immediately prior to such computation, except
in the case of a combination of outstanding shares of Common Stock, as
provided by Section 11(c) hereof.
For the purposes of this Section 11, the term "Exercise Price" shall
mean the exercise price of this Warrant, as adjusted from time to time
pursuant to the provisions of this Section 11.
For the purposes of any computation to be made in
accordance with this Section 11(a), the following provisions shall be
applicable:
(i) In case of the issuance or sale of shares of Common Stock
for a consideration part or all of which shall be cash, the amount of
the cash consideration therefor shall be deemed to be the amount of
cash received by the Company for such shares (or, if shares of Common
Stock are offered by the Company for subscription, the subscription
price, or, if such securities shall be sold to underwriters or dealers
for a public offering without a subscription offering, the public
offering price) before deducting therefrom any compensation paid or
discount allowed in the sale, underwriting or purchase thereof by
underwriters or dealers or others performing similar services, or any
expenses incurred in connection therewith.
(ii) In case of the issuance or sale (otherwise than as a
dividend or other distribution on any stock of the Company) of shares
of Common Stock for a consideration part or all of which shall be
other than cash, the amount of the consideration therefor other than
cash shall be deemed to be the value of such consideration as
determined in good faith by the Board of Directors of the Company.
(iii) Shares of 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 day following
the record date for the determination of stockholders entitled to
receive such dividend or other distribution and shall be deemed to
have been issued without consideration.
(iv) The reclassification of securities of the Company other
than shares of Common Stock into securities including shares of Common
Stock shall be deemed to involve the issuance of such shares of Common
Stock for a consideration other than cash immediately prior to the
close of business on the date fixed for the determination of
securityholders entitled to receive such shares, and the value of the
consideration allocable to such shares of Common Stock shall be
determined as provided in subparagraph (ii) of this Section 11(a).
5
<PAGE>
(v) The number of shares of Common Stock at any one time
outstanding shall include the aggregate number of shares issued or
issuable upon the exercise of options, rights or warrants and upon the
conversion or exchange of convertible or exchangeable securities.
(vi) As used herein, the phrase "Market Price" at any date shall
be deemed to be the average of the last reported sale price, or, in
case no such reported sale takes place on such day, the average of the
last reported sale prices for the last five trading days, in either
case as officially reported by the principal securities exchange on
which the Common Stock is listed or admitted to trading or as reported
on the Nasdaq Stock Market, or, if the Common Stock is not listed or
admitted to trading on any national securities exchange or quoted on
the Nasdaq Stock Market, the closing bid quotation on the OTC Bulletin
Board or otherwise in the over-the-counter market as furnished by the
National Association of Securities Dealers, Inc. through Nasdaq or a
similar organization if Nasdaq is no longer reporting such
information, or if the Common Stock is not quoted on Nasdaq or the OTC
Bulletin Board, as determined in good faith by resolution of the Board
of Directors of the Company, based on the best information available
to it for the day immediately preceding such issuance or sale. If the
Common Stock is listed or admitted to trading on a national securities
exchange and also quoted on the Nasdaq Stock Market, the Market Price
shall be determined as hereinabove provided by reference to the prices
reported in the Nasdaq Stock Market; provided that if the Common Stock
is listed or admitted to trading on the New York Stock Exchange, the
Market Price shall be determined as hereinabove provided by reference
to the prices reported by such exchange.
(b) Options, Rights, Warrants and Convertible and
Exchangeable Securities. Except in the case of the Company issuing
rights to subscribe for shares of Common Stock distributed pursuant to
Section 11(i) hereof, if the Company shall at any time after the date
hereof issue options, rights or warrants to subscribe for shares of
Common Stock, or issue any securities convertible into or exchangeable
for shares of Common Stock, in each case other than the issuances or
sales referred to in Section 11(f) hereof, (i) for a consideration per
share less than the lesser of (a) the Exercise Price in effect
immediately prior to the issuance of such options, rights or warrants,
or such convertible or exchangeable securities, or (b) the Market
Price determined as of the trading day immediately preceding such
issuance, or (ii) without consideration, the Exercise Price in effect
immediately prior to the issuance of such options, rights or warrants,
or such convertible or exchangeable securities, as the case may be,
shall be reduced to a price determined by making a computation in
accordance with the provisions of Section 11(a) hereof, provided that:
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<PAGE>
(i) The aggregate maximum number of shares of Common
Stock, as the case may be, issuable under all the outstanding options,
rights or warrants shall be deemed to be issued and outstanding at the
time all the outstanding options, rights or warrants were issued, and
for a consideration equal to the minimum purchase price per share
provided for in the options, rights or warrants at the time of
issuance, plus the consideration (determined in the same manner as
consideration received on the issue or sale of shares in accordance
with the terms of Section 11(a) hereof), if any, received by the
Company for the options, rights or warrants, and if no minimum
purchase price is provided in the options, rights or warrants, then
the minimum purchase price shall be equal to zero; provided, however,
that upon the expiration or other termination of the options, rights
or warrants, if any thereof shall not have been exercised, the number
of shares of Common Stock deemed to be issued and outstanding pursuant
to this Section 11(b) (and for the purposes of subparagraph (v) of
Section 11(a) hereof) shall be reduced by such number of shares as to
which options, warrants and/or rights shall have expired or terminated
unexercised, and such number of shares shall no longer be deemed to be
issued and outstanding, and the Exercise Price then in effect shall
forthwith be readjusted and thereafter be the price which it would
have been had adjustment been made on the basis of the issuance only
of shares actually issued or issuable upon the exercise of those
options, rights or warrants as to which the exercise rights shall not
have expired or terminated unexercised.
(ii) The aggregate maximum number of shares of Common
Stock issuable upon conversion or exchange of any convertible or
exchangeable securities shall be deemed to be issued and outstanding
at the time of issuance of such securities, and for a consideration
equal to the consideration (determined in the same manner as
consideration received on the issue or sale of shares of Common Stock
in accordance with the terms of Section 11 (a) hereof) received by the
Company for such securities, plus the minimum consideration, if any,
receivable by the Company upon the conversion or exchange thereof;
provided, however, that upon the expiration or other termination of
the right to convert or exchange such convertible or exchangeable
securities (whether by reason of redemption or otherwise), the number
of shares deemed to be issued and outstanding pursuant to this
subparagraph (ii) (and for the purpose of subparagraph (v) of Section
11(a) hereof) shall be reduced by such number of shares as to which
the conversion or exchange rights shall have expired or terminated
unexercised, and such number of shares shall no longer be deemed to be
issued and outstanding, and the Exercise Price then in effect shall
forthwith be readjusted and thereafter be the price which it would
have been had adjustment been made on the basis of the issuance only
of the shares actually issued or issuable upon the conversion or
exchange of those convertible or exchangeable securities as to which
the conversion or exchange rights shall not have expired or terminated
unexercised. No adjustment will be made pursuant to this subparagraph
(ii) upon the issuance by the Company of any convertible or
exchangeable securities pursuant to the exercise of any option, right
or warrant exercisable therefor, to the extent that adjustments in
respect of such options, rights or warrants were previously made
pursuant to the provisions of subparagraph (i) of this Section 11(b).
(iii) If any change shall occur in the price per share
provided for in any of the options, rights or warrants referred to in
subparagraph (i) of this Section 11(b), or in the price per share at
which the securities referred to in subparagraph (ii) of this Section
11(b) are convertible or exchangeable, or if any such options, rights
or warrants are exercised at a price greater than the minimum purchase
price provided for in such options, rights or warrants, or any such
securities are converted or exercised for more than the minimum
consideration receivable by the Company upon such conversion or
exchange, the options, rights or warrants or conversion or exchange
rights, as the case may be, shall be deemed to have expired or
terminated on the date when such price change became effective in
respect of shares not theretofore issued pursuant to the exercise or
conversion or exchange thereof, and the Company shall be deemed to
have issued upon such date new options, rights or warrants or
convertible or exchangeable securities at the new price with respect
of the number of shares issuable upon the exercise of such options,
rights or warrants or the conversion or exchange of such convertible
or exchangeable securities; provided, however, that no adjustment
shall be made pursuant to this subparagraph (iii) with respect to any
change in the price per share provided for in any of the options,
rights or warrants referred to in subparagraph (i) of this Section
11(b), or in the price per share at which the securities referred to
in subparagraph (ii) of this Section 11(b) are convertible or
exchangeable, which change results from the application of the anti-
dilution provisions thereof in connection with an event for which,
subject to subparagraph (iv) of Section 11(f), an adjustment to the
Exercise Price and the number of securities issuable upon exercise of
this Warrant will be required to be made pursuant to this Section 11.
(c) Subdivision and Combination. In case the Company
shall at any time after the date hereof subdivide or combine the
outstanding shares of Common Stock, the Exercise Price shall forthwith
be proportionately decreased in the case of subdivision or increased
in the case of combination.
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(d) Adjustment in Number of Warrant Shares. Upon
each adjustment of the Exercise Price pursuant to the provisions of
this Section 11, the number of shares of Common Stock issuable upon
the exercise of this Warrant shall be adjusted to the nearest full
whole number by multiplying a number equal to the Exercise Price in
effect immediately prior to such adjustment by the number of shares of
Common Stock issuable upon exercise of this Warrant immediately prior
to such adjustment and dividing the product so obtained by the
adjusted Exercise Price.
(e) Reclassification, Consolidation, Merger, etc. In
case of any reclassification or change of the outstanding shares of
Common Stock (other than a change in par value to no par value, or
from no par value to par value, or as a result of a subdivision or
combination), or in the case of any consolidation of the Company with,
or merger of the Company into, another corporation (other than a
consolidation or merger which does not result in any reclassification
or change of the outstanding shares of Common Stock, except a change
as a result of a subdivision or combination of such shares or a change
in par value, as aforesaid), or in the case of a sale or conveyance to
another corporation of the property of the Company as an entirety, the
Holder shall thereafter have the right to purchase the kind and number
of shares of stock and other securities and property receivable upon
such reclassification, change, consolidation, merger, sale or
conveyance as if the Holder were the owner of the shares of Common
Stock underlying this Warrant immediately prior to any such events at
a price equal to the product of (x) the number of shares of Common
Stock issuable upon exercise of this Warrant and (y) the Exercise
Price in effect immediately prior to the record date for such
reclassification, change, consolidation, merger, sale or conveyance as
if such Holder had exercised this Warrant.
(f) No Adjustment of Exercise Price in Certain Cases.
Notwithstanding anything herein to the contrary, no adjustment of the
Exercise Price shall be made:
(i) Upon the issuance of shares of Common Stock that
may be acquired upon the exercise of warrants to purchase an aggregate
of 6,000 shares of Common Stock identical to this Warrant issued upon
exercise of warrants granted to the designees of Sunrise Securities
Corp. in connection with a private offering of the Company's
securities; or
(ii) Upon (i) the issuance of options pursuant to the
Company's stock option plans in effect on the date hereof or as
hereafter amended in accordance with the terms thereof or any other
employee or executive stock option or award plan approved by
stockholders of the Company or the sale by the Company of any shares
of Common Stock pursuant to the exercise of any such options, or (ii)
the sale by the Company of any shares of Common Stock pursuant to the
exercise of any options or warrants issued and outstanding on the date
hereof.
(g) Dividends and Other Distributions with Respect to
Outstanding Securities. In the event that the Company shall at any
time after the date hereof and prior to the exercise and expiration of
this Warrant declare a dividend (other than a dividend consisting
solely of shares of Common Stock or a cash dividend or distribution
payable out of current or retained earnings) or otherwise distribute
to the holders of Common Stock any monies, assets, property, rights,
evidences of indebtedness, securities (other than such a cash dividend
or distribution or dividend consisting solely of shares of Common
Stock), whether issued by the Company or by another person or entity,
or any other thing of value, the Holder of this Warrant shall
thereafter be entitled, in addition to the shares of Common Stock or
other securities receivable upon the exercise thereof, to receive,
upon the exercise of this Warrant, the same monies, property, assets,
rights, evidences of indebtedness, securities or any other thing of
value that the Holder would have been entitled to receive at the time
of such dividend or distribution as if the Holder was the owner of the
shares of Common Stock underlying this Warrant. At the time of any
such dividend or distribution, the Company shall make appropriate
reserves to ensure the timely performance of the provisions of this
Section 11(h).
(h) Subscription Rights for Shares of Common Stock or
Other Securities. In case the Company shall at any time after the
date hereof and prior to the exercise of this Warrant in full issue
any rights to subscribe for shares of Common Stock or any other
securities of the Company to all the holders of Common Stock, the
Holder of this Warrant shall be entitled, in addition to the shares of
Common Stock or other securities receivable upon the exercise of this
Warrant, to receive such rights at the time such rights are
distributed to the other stockholders of the Company but only to the
extent of the number of shares of Common Stock, if any, for which this
Warrant remains exercisable.
(i) Notice in Event of Dissolution. In case of
the dissolution, liquidation or winding-up of the Company, all rights
under this Warrant 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 registered Holder
of this Warrant, as the same shall appear on the books and records of
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<PAGE>
the Company, by registered mail at least thirty (30) days prior to
such termination date."
12. Voluntary Adjustment by the Company. The Company
may at any time during the term of this Warrant, reduce the then
current Exercise Price to any amount and for any period of time deemed
appropriate by the Board of Directors of the Company.
13. Notice of Adjustment. Whenever the number of Warrant
Shares or number or kind of securities or other property purchasable
upon the exercise of this Warrant or the Exercise Price is adjusted,
as herein provided, the Company shall promptly mail by registered or
certified mail, return receipt requested, to the holder of this
Warrant notice of such adjustment or adjustments setting forth the
number of Warrant Shares (and other securities or property)
purchasable upon the exercise of this Warrant and the Exercise Price
of such Warrant Shares (and other securities or property) after such
adjustment, setting forth a brief statement of the facts requiring
such adjustment and setting forth the computation by which such
adjustment was made. Such notice, in absence of manifest error, shall
be conclusive evidence of the correctness of such adjustment.
14. Notice of Corporate Action. If at any time
(a) the Company shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive a dividend
or other distribution, or any right to subscribe for or purchase any
evidences of its indebtedness, any shares of stock of any class or any
other securities or property, or to receive any other right, or
(b) there shall be any capital reorganization of the
Company, any reclassification or recapitalization of the capital stock
of the Company or any consolidation or merger of the Company with, or
any sale, transfer or other disposition of all or substantially all
the property, assets or business of the Company to, another
corporation or,
(c) 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 to Holder (i) at least 30 days'
prior written notice of the date on which a record date shall be
selected for such dividend, distribution or right or for determining
rights to vote in respect of any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
liquidation or winding up, and (ii) in the case of any such
reorganization, reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up, at
least 30 days' prior written notice of the date when the same shall
take place. Such notice in accordance with the foregoing clause also
shall specify (i) the date on which any such record is to be taken for
the purpose of such dividend, distribution or right, the date on which
the holders of Common Stock shall be entitled to any such dividend,
distribution or right, and the amount and character thereof, and (ii)
the date on which any such reorganization, reclassification, merger,
consolidation, sale, transfer, disposition, dissolution, liquidation
or winding up is to take place and the time, if any such time is to be
fixed, as of which the holders of Common Stock shall be entitled to
exchange their shares of Common Stock for securities or other property
deliverable upon such disposition, dissolution, liquidation or winding
up. Each such written notice shall be sufficiently given if addressed
to Holder at the last address of Holder appearing on the books of the
Company and delivered in accordance with Section 16(d).
15. Authorized Shares. The Company covenants that during
the period the Warrant is outstanding, it will reserve from its
authorized and unissued Common Stock a sufficient number of shares to
provide for the issuance of the Warrant Shares upon the exercise of
any purchase rights under this Warrant. The Company further covenants
that its issuance of this Warrant shall constitute full authority to
its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for the
Warrant Shares upon the exercise of the purchase rights under this
Warrant. The Company will take all such reasonable action as may be
necessary to assure that such Warrant Shares may be issued as provided
herein without violation of any applicable law or regulation, or of
any requirements of NASDAQ or any domestic securities exchange upon
which the Common Stock may be listed.
The Company shall not by any action, including, without
limitation, amending its certificate of incorporation or through any
reorganization, transfer of assets, consolidation, merger,
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<PAGE>
dissolution, issue or sale of securities or any other voluntary
action, avoid or seek to avoid the observance or performance of any of
the terms of this Warrant, but will at all times in good faith assist
in the carrying out of all such terms and in the taking of all such
actions as may be necessary or appropriate to protect the rights of
Holder against impairment. Without limiting the generality of the
foregoing, the Company will (a) not increase the par value of any
shares of Common Stock receivable upon the exercise of this Warrant
above the amount payable therefor upon such exercise immediately prior
to such increase in par value, (b) take all such action as may be
necessary or appropriate in order that the Company may validly and
legally issue fully paid and nonassessable shares of Common Stock upon
the exercise of this Warrant, and (c) use its best efforts to obtain
all such authorizations, exemptions or consents from any public
regulatory body having jurisdiction thereof as may be necessary to
enable the Company to perform its obligations under this Warrant.
Upon the request of Holder, the Company will at any time
during the period this Warrant is outstanding acknowledge in writing,
in form reasonably satisfactory to Holder, the continuing validity of
this Warrant and the obligations of the Company hereunder.
Before taking any action which would cause an adjustment
reducing the current Exercise Price below the then par value, if any,
of the shares of Common Stock issuable upon exercise of the Warrants,
the Company shall take any corporate action which may be necessary in
order that the Company may validly and legally issue fully paid and
non-assessable shares of such Common Stock at such adjusted Exercise
Price.
Before taking any action which would result in an
adjustment in the number of shares of Common Stock for which this
Warrant is exercisable or in the Exercise Price, the Company shall
obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies
having jurisdiction thereof.
16. Miscellaneous.
(a) Issue Date; Jurisdiction. The provisions of this
Warrant shall be construed and shall be given effect in all respects
as if it had been issued and delivered by the Company on the date
hereof. This Warrant shall be binding upon any successors or assigns
of the Company. This Warrant shall constitute a contract under the
laws of New York without regard to its conflict of law, principles or
rules, and be subject to arbitration pursuant to the terms set forth
in the Agreement.
(b) Restrictions. The holder hereof acknowledges
that the Warrant Shares acquired upon the exercise of this Warrant, if
not registered, will have restrictions upon resale imposed by state
and federal securities laws.
(c) Nonwaiver and Expenses. No course of dealing or
any delay or failure to exercise any right hereunder on the part of
Holder shall operate as a waiver of such right or otherwise prejudice
Holder's rights, powers or remedies, notwithstanding all rights
hereunder terminate on the Termination Date. If the Company fails to
make, when due, any payments provided for hereunder, or fails to
comply with any other provision of this Warrant, the Company shall pay
to Holder such amounts as shall be sufficient to cover any costs and
expenses including, but not limited to, reasonable attorneys' fees,
including those of appellate proceedings, incurred by Holder in
collecting any amounts due pursuant hereto or in otherwise enforcing
any of is rights, powers or remedies hereunder.
(d) Notices. Any notice, request or other document
required or permitted to be given or delivered to the holder hereof by
the Company shall be delivered in accordance with the notice
provisions of the subscription agreement between the Holder and the
Company.
(e) Limitation of Liability. No provision hereof, in
the absence of affirmative action by Holder to purchase shares of
Common Stock, and no enumeration herein of the rights or privileges of
Holder hereof, shall give rise to any liability of Holder for the
purchase price of any Common Stock or as a stockholder of the Company,
whether such liability is asserted by the Company or by creditors of
the Company.
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(f) Remedies. Holder, in addition to being entitled
to exercise all rights granted by law, including recovery of damages,
will be entitled to specific performance of its rights under this
Warrant. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by
it of the provisions of this Warrant and hereby agrees to waive the
defense in any action for specific performance that a remedy at law
would be adequate.
(g) Successors and Assigns. Subject to applicable
securities laws, this Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the
Company and the successors and assigns of Holder. The provisions of
this Warrant are intended to be for the benefit of all Holders from
time to time of this Warrant and shall be enforceable by any such
Holder or holder of Warrant Stock.
(h) Cooperation. The Company shall cooperate with
Holder in supplying such information as may be reasonably necessary
for Holder to complete and file any information reporting forms
presently or hereafter required by the Commission as a condition to
the availability of an exemption from the Securities Act for the sale
of any Warrant or Restricted Common Stock.
(i) Indemnification. The Company agrees to indemnify
and hold harmless Holder from and against any liabilities,
obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs, attorneys' fees, expenses and disbursements of any kind
which may be imposed upon, incurred by or asserted against Holder in
any manner relating to or arising out of any failure by the Company to
perform or observe in any material respect any of its covenants,
agreements, undertakings or obligations set forth in this Warrant;
provided, however, that the Company will not be liable hereunder to
the extent that any liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, claims, costs, attorneys' fees,
expenses or disbursements are found in a final non-appealable judgment
by a court to have resulted from Holder's negligence, bad faith or
willful misconduct in its capacity as a stockholder or warrantholder
of the Company.
(j) Amendment. This Warrant and all other Warrants
may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder.
(k) Severability. Wherever possible, each provision
of this Warrant shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this Warrant
shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
(l) Headings. The headings used in this Warrant are
for the convenience of reference only and shall not, for any purpose,
be deemed a part of this Warrant.
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IN WITNESS WHEREOF, the Company has caused this Warrant to
be executed by its officer thereunto duly authorized.
Dated: September 26, 2000
MICROS-TO-MAINFRAMES, INC.
By:______________________
Steven H. Rothman
Chief Executive Officer and President
<PAGE>
NOTICE OF EXERCISE
To: MICROS-TO-MAINFRAMES, INC.
(1) The undersigned hereby elects to purchase ________
shares of Common Stock, par value $0.001 per share (the "Common
Stock"), of MICROS-TO-MAINFRAMES, INC. pursuant to the terms of the
attached Warrant, and tenders herewith payment of the exercise price
in full, together with all applicable transfer taxes, if any.
(2) Please issue a certificate or certificates representing
said shares of Common Stock in the name of the undersigned or in such
other name as is specified below:
_______________________________
(Name)
_______________________________
(Address)
_______________________________
Dated:
______________________________
Signature
<PAGE>
ASSIGNMENT FORM
(To assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to exercise the warrant.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights
evidenced thereby are hereby assigned to
_______________________________________________ whose address is
_______________________________________________________________.
_______________________________________________________________
Dated: ________________________,
Holder's Signature: _____________________________
Holder's Address: _____________________________
_____________________________
Signature Guaranteed: ___________________________________________
NOTE: The signature to this Assignment Form must correspond with the
name as it appears on the face of the Warrant, without alteration or
enlargement or any change whatsoever, and must be guaranteed by a bank
or trust company. Officers of corporations and those acting in an
fiduciary or other representative capacity should file proper evidence
of authority to assign the foregoing Warrant.
14
