EXHIBIT C
NEITHER THE
OFFER NOR THE SALE OF THIS CLASS B WARRANT OR THE SHARES ISSUABLE
UPON THE EXERCISE OF THIS CLASS B WARRANT HAS BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED. EXCEPT AS
OTHERWISE SET FORTH HEREIN OR IN A SECURITIES PURCHASE AGREEMENT
DATED AS OF JUNE 1, 2009, NEITHER THIS CLASS B WARRANT NOR ANY OF
SUCH SHARES MAY BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE
ACT OR AN OPINION OF COUNSEL, IN FORM, SUBSTANCE AND SCOPE,
CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS, THAT
REGISTRATION IS NOT REQUIRED UNDER THE ACT OR UNLESS SOLD PURSUANT
TO RULE 144 OR REGULATION D OR REGULATION S UNDER THE
ACT. FURTHER, HEDGING TRANSACTIONS WITH REGARD TO THE
WARRANTS OR SHARES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH
THE SECURITIES ACT.
CLASS B COMMON STOCK PURCHASE
WARRANT
THIS
CERTIFIES THAT , for
value received, _______________________________ , or its
registered assigns, (the “ Holder ”) is entitled
to purchase from TRESTLE HOLDING, INC. (to be renamed MoqiZone
Holding Corporation) , a Delaware corporation, (the “
Company ”), at any time or from time to time during
the period specified in Section 2 hereof, _____________________
( ), which represents that number of shares of the
Company’s common stock, $0.001 par value per share (the
“ Common Stock ”), as shall be equal to fifty
percent (50%) of the number of shares of Common Stock that are
issuable upon conversion of the shares of Series A Preferred Stock
of the Company (the “ Conversion Shares ”) to be
received by the Holder in exchange for his or its Note (ie. 2,778
Conversion Shares for each $10,000 principal amount of Note
purchased and $1,000 Stated Value of each share of Series A
Preferred Stock received in exchange for such Note), all pursuant
to the terms and conditions of the “ Securities Purchase
Agreement ” (as hereinafter defined), at an exercise
price of equal to (U.S.) $3.00 per share (the “
Exercise Price ”).
As used herein,
the term “ Class B Warrant Shares ” shall mean
the shares of Common Stock that are purchasable
hereunder. The number of Class B Warrant Shares and the
Exercise Price per Class B Warrant Share are subject to adjustment
as provided in Section 4 hereof. The term “
Class B Warrants ” means this Class B Warrant and the
other Class B Warrants issued pursuant to that certain Securities
Purchase Agreement, dated as of June 1, 2009 (the “
Securities Purchase Agreement ”), by and among the
Company, the “MoqiZone Group,” the other
“Corporate Parties” (as defined therein), and the
Investors listed on the execution page thereof.
Unless
otherwise defined in this Class B Warrant, all capitalized terms,
when used herein, shall have the same meaning as is defined in the
Securities Purchase Agreement.
This Class B Warrant is subject to the following
terms, provisions, and conditions:
Procedure . Subject to the provisions hereof,
this Class B Warrant may be exercised by the Holder, in whole or in
part, by the surrender of this Class B Warrant, together with a
completed exercise agreement in the form attached hereto (the
“ Exercise Agreement ”), to the Company during
normal business hours on any day that banks are generally open for
business in New York City (a “ Business Day ”)
at the Company’s principal executive offices (or such other
office or agency of the Company as it may designate by notice to
the Holder), and upon payment to the Company in cash, by certified
or official bank check or by wire transfer for the account of the
Company of the Exercise Price for the Class B Warrant Shares
specified in the Exercise Agreement for the Class B Warrant Shares
specified in the Exercise Agreement; or by “cashless
exercise” in accordance with the provisions of sub-section
(a) below, but only when a registration statement under the
Securities Act providing for the resale of the Warrant Stock is not
then in effect, or (iii) by a combination of the foregoing methods
of payment selected by the Holder of this Warrant.
Shares shall
have been registered for resale pursuant to an effective
registration statement. The Class B Warrant Shares so
purchased shall be deemed to be issued to the Holder or such
Holder’s designee, as the record owner of such shares, as of
the close of business on the date on which the completed Exercise
Agreement shall have been delivered, and payment shall have been
made for such shares as set forth above. Certificates
for the Class B Warrant Shares so purchased, representing the
aggregate number of shares specified in the Exercise Agreement,
shall be delivered to the Holder (without restrictive legend
thereon when such exercise occurs while a registration statement
registering under the Securities Act of 1933, as amended (the
“ Securities Act ”) the resale of the Class B
Warrant Shares so purchased is effective or such Class B Warrant
Shares so purchased may be resold by the Holder pursuant to Rule
144 or any similar successor rule) within a reasonable time, not
exceeding three (3) Business Days, after this Class B Warrant shall
have been so exercised. The certificates so delivered
shall be in such denominations as may be requested by the Holder
and shall be registered in the name of the Holder or such other
name as shall be designated by the Holder. If this Class
B Warrant shall have been exercised only in part, then, at the
option of the Holder (i) the Holder may surrender this Class B
Warrant to the Company and, unless this Class B Warrant has
expired, the Company shall, at its expense, within a reasonable
time, not exceeding three (3) Business Days, after this Class B
Warrant shall have been so exercised, deliver to the Holder a new
Class B Warrant representing the number of shares with respect to
which this Class B Warrant shall not then have been exercised, or
(ii) the Holder may retain this Class B Warrant and the Class B
Warrant Shares purchasable under this Class B Warrant shall be
reduced by such number of Class B Warrant Shares so exercised by
the Holder and properly delivered by the Company
hereunder.
Notwithstanding
any provisions herein to the contrary and commencing one (1) year
following the Original Issue Date if (1) the Per Share Market Value
of one share of Common Stock is greater than the Warrant Price (at
the date of calculation as set forth below) and (ii) a registration
statement under the Securities Act providing for the resale of the
Warrant Stock is not then in effect by the date such registration
statement is required to be effective pursuant to the Registration
Rights Agreement (as defined in the Securities Purchase Agreement)
or not effective at any time during the Effectiveness Period (as
defined in the Registration Rights Agreement) in accordance with
the terms of the Registration Rights Agreement, unless the
registration statement is not effective as a result of the Issuer
exercising its rights under Section 3(n) of the Registration Rights
Agreement, in lieu of exercising this Warrant by payment of cash,
the Holder may exercise this Warrant by a cashless exercise and
shall receive the number of shares of Common Stock equal to an
amount (as determined below) by surrender of this Warrant at the
principal office of the Issuer together with the properly endorsed
Notice of Exercise in which event the Issuer shall issue to the
Holder a number of shares of Common Stock computed using the
following formula:
Where X
= the
number of shares of Common Stock to be issued to the
Holder.
Y
= the
number of shares of Common Stock purchasable upon exercise of all
of the Warrant or, if only a portion of the Warrant is being
exercised, the portion of the Warrant being exercised.
B
= the
Per Share Market Value of one share of Common Stock.
(i) Notwithstanding
anything to the contrary set forth in this Class B Warrant, at no
time may a Holder of this Class B Warrant exercise their Class B
Warrant if the number of shares of Common Stock to be issued
pursuant to such exercise would cause the number of shares of
Common Stock owned by such Holder at such time to exceed, when
aggregated with all other shares of Common Stock owned by such
Holder and its affiliates at such time, the number of shares of
Common Stock which would result in such Holder, its affiliates, any
investment manager having discretionary investment authority over
the accounts or assets of such Holder, or any other persons whose
beneficial ownership of Common Stock would be aggregated with such
Holder’s for purposes of Section 13(d) and Section 16 of the
Exchange Act, beneficially owning (as determined in accordance with
Section 13(d) of the Exchange Act and the rules thereunder) in
excess of 9.99% of the then issued and outstanding shares of Common
Stock; provided, however, that upon a Holder of this Class B
Warrant providing the Corporation with sixty-one (61) day Waiver
Notice that such Holder would like to waive this Section (b)(i)
with regard to any or all shares of Common Stock issuable upon
exercise of this Class B Warrant, this Section (b)(i) shall be of
no force or effect with regard to those shares of Common Stock
referenced in the Waiver Notice; provided, further, that during the
sixty-one (61) day period prior to the expiration of the Exercise
Period, the Holder may waive this Section 1(b)(i) by providing a
Waiver Notice at any time during such sixty-one (61) day period;
provided, further, that any Waiver Notice provided during the
sixty-one (61) day period prior to the expiration of the Exercise
Period will not be effective until the last day of the Exercise
Period.
This Class B
Warrant is exercisable, commencing on or after the consummation of
the Trestle Reverse Split and the filing by Trestle with the
Secretary of State of the State of Delaware of the Certificate of
Designations for the Series A Preferred Stock, and may be exercised
at any time or from time to time thereafter, until 6:00 p.m., New
York, New York time on May 31, 2012, when this Class B Warrant
shall expire (the “ Exercise Period
”).
3.
Certain Agreements of the Company . The
Company hereby covenants and agrees as follows:
a.
Shares to be Fully Paid . All Class B
Warrant Shares will, upon issuance in accordance with the terms of
this Class B Warrant, be validly issued, fully paid, and
non-assessable and free from all taxes, liens, and charges with
respect to the issue thereof.
b.
Reservation of Shares . During the
Exercise Period, the Company shall at all times have authorized,
and reserved for the purpose of issuance upon exercise of this
Class B Warrant, a sufficient number of shares of Common Stock to
provide for the exercise of this Class B Warrant.
c.
Listing . If the Company’s Common
Stock is listed as of the date of this Class B Warrant, or if so
listed in the future, the Company shall maintain its listing of its
Common Stock on each national securities exchange or automated
quotation system, as the case may be, and shall maintain such
listing of any other shares of capital stock of the Company
issuable upon the exercise of this Class B Warrant if and so long
as any shares of the same class shall be listed on such national
securities exchange or automated quotation system.
d.
Certain Actions Prohibited . The Company
will not, by amendment of its charter 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 to be observed or performed by it hereunder, but will
at all times in good faith assist in the carrying out of all the
provisions of this Class B Warrant and in the taking of all such
action as may reasonably be requested by the Holder of this Class B
Warrant in order to protect the exercise privilege of the Holder of
this Class B Warrant against dilution or other impairment,
consistent with the tenor and purpose of this Class B
Warrant. Without limiting the generality of the
foregoing, the Company (i) will not increase the par value of any
shares of Common Stock receivable upon the exercise of this Class B
Warrant above the Exercise Price then in effect, and (ii) will take
all such actions 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
Class B Warrant.
e.
Successors and Assigns . This Class B
Warrant will be binding upon any entity succeeding to the Company
by merger, consolidation, or acquisition of all or substantially
all the Company’s assets.
f.
Delivery of Common Stock by Electronic Transfer
. In lieu of delivering physical certificates
representing the Common Stock issuable upon exercise, provided the
Company’s transfer agent is participating in the Depository
Trust Company (“ DTC ”) Fast Automated
Securities Transfer program and the Company has activated such
programs, upon request of the Holder and its compliance with the
provisions contained in Section 1, the Company shall use its best
efforts to cause its transfer agent to electronically transmit the
Common Stock issuable upon exercise to the Holder by crediting the
account of Holder’s Prime Broker with DTC through its Deposit
Withdrawal Agent Commission system.
4.
Antidilution Provisions . The Exercise
Price and the number of Class B Warrant Shares, as the case may be,
shall be subject to adjustment from time to time as provided in
this Section 4 ; provided, that the
anti-dilution adjustments contemplated by Section 4e below
shall expire on a date which shall be the twelve (12) month
anniversary of the effective date of the Registration
Statement. In the event that any adjustment of the
Exercise Price as required herein results in a fraction of a cent,
such Exercise Price shall be rounded down to the nearest
cent.
a.
Reorganization, Consolidation, Merger, etc.;
Reclassification . In case at any time or from
time to time, the Company shall effect any merger, reorganization,
restructuring, reverse stock split, consolidation, sale of all or
substantially all of the Company’s assets or any similar
transaction or related transactions (each such transaction, a
“ Fundamental Change ”), then, in each such
case, as a condition to the consummation of such a transaction,
proper and adequate provision shall be made by the Company whereby
the Holder of this Warrant, on the exercise hereof, at any time
after the consummation of such Fundamental Change, shall receive,
in lieu of the Warrant Shares issuable on such exercise prior to
such consummation or such effective date, the stock and other
securities and property (including cash) to which such Holder would
have been entitled upon such consummation of a Fundamental Change
if such Holder had so exercised this Warrant, immediately prior
thereto.
If the Company
at any time shall, by reclassification or otherwise, change the
Common Stock into the same or a different number of securities of
any class or classes that may be issued or outstanding, this
Warrant shall thereafter be deemed to evidence the right to
purchase an adjusted number of such securities and kind of
securities as would have been issuable as the result of such change
with respect to the Common Stock immediately prior to such
reclassification or other change.
b.
Dissolution . In the event of any
dissolution of th
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