Exhibit 4.6
PREFERRED STOCK
WARRANT
TO PURCHASE
SHARES OF SERIES A PREFERRED
STOCK
OF
SUPERTEL HOSPITALITY,
INC.
(Void after
, 2010)
Warrant No.
THIS SECURITY HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED AND MAY NOT
BE OFFERED OR SOLD EXCEPT IN COMPLIANCE THEREWITH. THIS WARRANT AND
THE SHARES PURCHASABLE HEREUNDER ARE SUBJECT TO RESTRICTIONS ON
TRANSFER AS SET FORTH HEREIN.
UNTIL
, 2006, NEITHER ANDERSON & STRUDWICK, INCORPORATED NOR ANY
ASSIGNEE OF ALL OR A PORTION OF THE RIGHTS PURSUANT TO THIS WARRANT
MAY SELL, TRANSFER, ASSIGN, PLEDGE OR HYPOTHECATE ANY OF ITS RIGHTS
PURSUANT TO THIS WARRANT OTHER THAN TO BONA FIDE OFFICERS OF
ANDERSON & STRUDWICK, INCORPORATED .
This certifies that
Anderson & Strudwick, Incorporated (“A&S,”
and each of A&S and any successor or assign being a
“Holder”), for consideration of the payment of the sum
of $0.001 cash per Warrant Share (as defined below), the
sufficiency and receipt of which is hereby acknowledged, is
entitled to purchase from Supertel Hospitality, Inc., a Virginia
corporation (the “Company”), subject to the terms set
forth below, a maximum of
(
), newly issued, fully paid and nonassessable shares (subject to
adjustment as provided herein) of the Company’s Series A
Preferred Stock, $.01 par value per share (the “Warrant
Shares”) for cash at a price of $12.00 per share (as adjusted
as provided herein, the “Exercise Price”) or pursuant
to the cashless exercise terms in Section 1.2 at any time or
from time to time after
, 2006 and expiring at 5:00 p.m. (Eastern Time)
, 2010 (the “Expiration Date”) upon surrender to the
Company at its principal office (or at such other location as the
Company may advise the Holder in writing) of this Warrant properly
endorsed with the Form of Subscription attached hereto duly filled
in and signed and , if the cashless exercise terms in
Section 1.2 are not utilized, upon payment in cash or by check
of the aggregate Exercise Price for the number of shares for which
this Warrant is being exercised determined in accordance with the
provisions hereof. The Exercise Price is subject to adjustment as
provided in Section 3 of this Warrant and the right to
purchase the Warrant Shares and the number of Warrant Shares that
may be purchased hereunder are subject to the contingencies set
forth in this Warrant.
This Warrant is subject to the
following terms and conditions:
1. Exercise, Issuance of
Certificates, Reduction in Number of Warrant Shares
.
1.1. General . Except as
provided in Section 1.2, this Warrant is exercisable at the
option of the Holder of record hereof on or prior to the Expiration
Date, at any time or from time to time, for all or any part of the
Warrant Shares (but not for a fraction of a share) which may be
purchased hereunder, as that number may be adjusted pursuant to
Sections 1.2 or 3 of this Warrant. The Company agrees that the
Warrant Shares purchased under this Warrant shall be and are deemed
to be issued to the Holder hereof as the record owner of such
Warrant Shares as of the close of business on the date on which
this Warrant shall have been surrendered, the completed and
executed Form of Subscription delivered, and payment of the
Exercise Price in cash or by certified check, or if applicable,
submission of the cashless exercise calculation pursuant to
Section 1.2 for such Warrant Shares. Certificates for the
Warrant Shares so acquired, together with any other securities or
property (including any money) to which the Holder hereof is
entitled upon such exercise, shall be delivered to the Holder or
its transferee designated in writing to the Company by the Company
at the Company’s expense not later than ten (10) days
after the rights represented by this Warrant have been so
exercised. In case of a purchase of less than all the Warrant
Shares which may be purchased under this Warrant, the Company shall
cancel this Warrant and promptly execute and deliver to the Holder
or its transferee designated in writing to the Company a new
Warrant or Warrants of like tenor for the balance of the Warrant
Shares purchasable under the Warrant surrendered upon such
purchase. Each stock certificate so delivered shall be registered
in the name of such Holder. The Company shall pay all documentary,
stamp or similar issue or transfer taxes payable in respect of the
issue or delivery of the Warrant Shares.
1.2. Net Issue Exercise of
Warrant . Notwithstanding any provisions herein to the
contrary, if the fair market value of one share of Series A
Preferred Stock is greater than the Exercise Price (at the date of
calculation as set forth below), in lieu of exercising this Warrant
for cash, Holder may elect to receive shares of Series A Preferred
Stock equal to the value (as determined below) of this Warrant (or
the portion thereof being canceled) by surrender of this Warrant at
the principal office of the Company together with the properly
endorsed Form of Subscription in which event the Company shall
issue to the Holder a number of shares of Series A Preferred Stock
computed using the following formula:
X = Y (A-B)
A
Where X = the number of shares of
Series A Preferred Stock to be issued to Holder
Y = the number of shares of Series A
Preferred Stock purchasable under the Warrant or, if only a portion
of the Warrant is being exercised, the portion of the Warrant being
canceled (at the date of such calculation)
2
A = the Fair Market Value of one
share of the Company’s Series A Preferred Stock (at the date
of such calculation)
B = Exercise Price (as adjusted to
the date of such calculation)
For the purposes of this Warrant,
the term “Fair Market Value” of a share of the
Company’s Series A Preferred Stock shall mean (a) if the
shares of Series A Preferred Stock then are listed and traded on
the New York Stock Exchange, Inc. (“NYSE”), the average
of the closing prices as reported on the NYSE Composite
Transactions Tape for the ten (10) trading days immediately
preceding the date of on which the Warrant Shares are deemed issued
pursuant to Section 1.1; (B) if the shares of Series A
Preferred Stock then are not listed and traded on the NYSE, the
average of the closing prices as reported by the principal national
securities exchange on which the shares are listed and traded for
the ten (10) trading days immediately preceding the date of on
which the Warrant Shares are deemed issued pursuant to
Section 1.1; (C) if the shares of Series A Preferred
Stock then are not listed and traded on any such securities
exchange, average of the closing prices on the National Market of
the National Association of Securities Dealers, Inc. Automated
Quotation System (“NASDAQ”) for the ten
(10) trading days immediately preceding the date of on which
the Warrant Shares are deemed issued pursuant to Section 1.1;
or (D) if the shares Series A Preferred Stock then are not
traded on the NASDAQ National Market, the average of the average
highest reported bid and lowest reported asked price for the ten
(10) trading days immediately preceding the date of on which
the Warrant Shares are deemed issued pursuant to Section 1.1
as reported by NASDAQ. If on any determination date the shares of
Series A Preferred Stock are not quoted by any such organization,
the Fair Market Value of a share of Series A Preferred Stock shall
be the fair market value of such share on such determination date
as determined by the Board of Directors. If the Holder shall object
to any determination by the Board of Directors of the Fair Market
Value of the Series A Preferred Stock, the Fair Market Value of a
share of Series A Preferred Stock shall be determined by an
independent appraiser retained by the Company and reasonably
acceptable to the Holder, with the expense to be borne by the
Holder if the Fair Market Value as determined by such appraiser
equals or exceeds the Fair Market Value as determined by the Board
of Directors, and by the Company if the Fair Market Value as
determined by such appraiser is less than the Fair Market Value as
determined by the Board of Directors.
2. Reservation of Shares .
The Company hereby agrees that at all times there shall be reserved
for issuance and delivery upon exercise of this Warrant such number
of authorized but unissued Warrant Shares (and common stock into
which such Warrant Shares are convertible) as will be sufficient to
permit the full exercise of this Warrant. The Company covenants and
agrees that all Warrant Shares, and all shares of common stock
issuable upon conversion of such Warrant Shares, shall be duly
authorized and, upon issuance in accordance herewith, shall be
validly issued, fully paid and nonassessable, and free of all
liens, security interests, charges and other encumbrances or
restrictions upon sale and free and clear of preemptive or similar
rights, except for restrictions on transfer provided for herein or
under applicable federal and state securities laws.
3
3. Adjustment of Exercise Price
and Number of Shares for Equity Events . The Exercise Price and
the total number of Warrant Shares shall be subject to adjustment
from time to time upon the occurrence of certain events described
in this Section 3. Upon each adjustment of the Exercise Price,
the Holder of this Warrant shall thereafter be entitled to
purchase, at the Exercise Price resulting from such adjustment, the
number of shares obtained by multiplying the Exercise Price in
effect immediately prior to such adjustment by the number of shares
purchasable pursuant hereto immediately prior to such adjustment,
and dividing the product thereof by the Exercise Price resulting
from such adjustment.
3.1. Dividends; Subdivision or
Combination of Stock .
(a) In the case the Company shall at
any time after the date hereof (i) declare a dividend or make
a distribution on Series A Preferred Stock payable in Series A
Preferred Stock, (ii) subdivide or split the outstanding
Series A Preferred Stock, (iii) combine or reclassify the
outstanding Series A Preferred Stock into a smaller number of
shares, or (iv) issue any shares of its capital stock in a
reclassification of Series A Preferred Stock (including any such
reclassification in connection with a consolidation or merger in
which the Company is the continuing corporation), the Exercise
Price in effect at the time of the record date for such dividend or
distribution or of the effective date of such subdivision, split,
combination or reclassification shall be proportionately adjusted
so that the exercise of this Warrant after such time shall entitle
the holder to receive the aggregate number of shares of Series A
Preferred Stock or other securities of the Company (or shares of
any security into which such shares of Series A Preferred Stock
have been reclassified pursuant to clause 3.1(a)(iii) or 3.1(a)(iv)
above) which, if this Warrant had been exercised immediately prior
to such time, such holder would have owned upon such exercise and
been entitled to receive by virtue of such dividend, distribution,
subdivision, split, combination or reclassification. Such
adjustment shall be made successively whenever any event listed
above shall occur.
(b) In the event that, at any time
as a result of the provisions of this paragraph 3.1 the Holder of
this Warrant upon subsequent exercise shall become entitled to
receive any shares of capital stock of the Company other than
Series A Preferred Stock, the number of such other shares so
receivable upon exercise of this Warrant shall thereafter be
subject to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions contained
herein.
(c) Upon each adjustment of the
Exercise Price as a result of the calculations made in paragraphs
3.1(a) hereof, the number of Warrant Shares for which this Warrant
is exercisable immediately prior to the making of such adjustment
shall thereafter evidence the right to purchase, at the adjusted
Exercise Price, that number of Warrant Shares obtained by
(i) multiplying the number of Warrant S
