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EXHIBIT 4.7
THIS WARRANT AND THE UNDERLYING SHARES OF
COMMON STOCK HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933 (THE “SECURITIES ACT”), OR ANY OTHER
SECURITIES LAWS, HAVE BEEN TAKEN FOR INVESTMENT, AND MAY NOT BE
SOLD OR TRANSFERRED OR OFFERED FOR SALE OR TRANSFER UNLESS A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND OTHER
APPLICABLE SECURITIES LAWS WITH RESPECT TO SUCH SECURITIES IS
THEN IN EFFECT, OR IN THE OPINION OF COUNSEL TO THE ISSUER OF
THESE SECURITIES, SUCH REGISTRATION UNDER THE SECURITIES ACT AND
OTHER APPLICABLE SECURITIES LAWS IS NOT REQUIRED.
WARRANT FOR THE PURCHASE OF SHARES OF
COMMON STOCK OF ECOSPHERE TECHNOLOGIES, INC.
THIS IS TO CERTIFY that, for value received,
Heller Capital Investments, LLC, its successors and assigns
(collectively, the “Holders”), are entitled to
purchase, subject to the terms and conditions hereinafter set
forth, 1,000,000 shares of Ecosphere Technologies, Inc., a
Delaware corporation (the “Company”) common stock,
$0.01 par value per share (“Common Stock”), and to
receive certificates for the Common Stock so purchased.
The exercise price of this Warrant is $0.15 per share,
subject to adjustment as provided below (the “Exercise
Price”). This Warrant replaces a 1,000,000 share
Warrant dated March 6, 2007 exercisable at $0.48 per share.
1.
Exercise Period and Vesting. This
Warrant is exercisable by the Holders at any time through 5:00
p.m., New York, New York time, March 6, 2011 (the
“Exercise Period”). This Warrant will terminate
automatically and immediately upon the expiration of the
Exercise Period.
2.
Exercise of Warrant; Cashless Exercise.
This Warrant may be exercised, in whole or in part, at any
time and from time to time during the Exercise Period.
Such exercise shall be accomplished by tender to the
Company of an amount equal to the Exercise Price multiplied by
number of underlying shares being purchased (the “Purchase
Price”), either (a) in cash, by wire transfer or by
certified check or bank cashier’s check, payable to the
order of the Company, or (b) by surrendering such number of
shares of Common Stock received upon exercise of this Warrant
with an aggregate Fair Market Value (as defined below) equal to
the Purchase Price (as described in the following paragraph (a
“Cashless Exercise”), together with presentation and
surrender to the Company of this Warrant with an executed
subscription agreement in substantially the form attached hereto
as Exhibit A (the “Subscription”). Upon
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receipt of the foregoing, the Company will
deliver to the Holder, as promptly as possible, a certificate or
certificates representing the shares of Common Stock so
purchased, registered in the name of the Holder or its
transferee (as permitted under Section 3 below). With
respect to any exercise of this Warrant, the Holder will for all
purposes be deemed to have become the holder of record of the
number of shares of Common Stock purchased hereunder on the date
a properly executed Subscription and payment of the Purchase
Price is received by the Company (the “Exercise
Date”), irrespective of the date of delivery of the
certificate evidencing such shares, except that, if the date of
such receipt is a date on which the stock transfer books of the
Company are closed, such person will be deemed to have become
the holder of such shares at the close of business on the next
succeeding date on which the stock transfer books are open.
Fractional shares of Common Stock will not be issued upon
the exercise of this Warrant. In lieu of any fractional
shares that would have been issued but for the immediately
preceding sentence, the Holder will be entitled to receive cash
equal to the current market price of such fraction of a share of
Common Stock on the trading day immediately preceding the
Exercise Date. In the event this Warrant is exercised in
part, the Company shall issue a new Warrant to the Holder
covering the aggregate number of shares of Common Stock as to
which this Warrant remains exercisable for.
If the Holder elects to conduct a Cashless
Exercise, the Company shall cause to be delivered to the Holder
a certificate or certificates representing the number of shares
of Common Stock computed using the following formula:
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X = Y
(A-B)
A
Where:
X
=
the number of shares of Common Stock to be issued to Holder;
Y
=
the portion of the Warrant (in number of shares of Common
Stock) being exercised by Holder (at the date of such
calculation);
A
=
the Fair Market Value (as defined below) of one share of
Common Stock on the Exercise Date, calculated by taking the
average Fair Market Value over the last 10 trading days (not
including the Exercise Date); and
B
=
Warrant Price (as adjusted to the date of such calculation).
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For purposes of the foregoing calculation, Fair
Market Value shall mean: (i) if the principal
trading market for such securities is a national securities
exchange, The Nasdaq Stock Market or the Over-the-Counter
Bulletin Board (“OTCBB”) (or a similar system then
in use), the last reported sales price on the principal market
the trading day immediately prior to such Exercise Date; or (ii)
if (i) is not applicable, and if bid and ask prices
for shares of Common Stock are reported by the principal trading
market or the National Quotation Bureau, the average of the high
bid and low ask prices so reported for the trading day
immediately prior to such Exercise Date. Notwithstanding
the foregoing, if there is no last reported sales price or bid
and ask prices, as the case may be, for the day in question,
then Fair Market Value shall be determined as of the
latest day prior to such day for which such last reported sales
price or bid
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and ask prices, as the case may be, are
available, unless such securities have not been traded on an
exchange or in the over-the-counter market for 30 or more days
immediately prior to the day in question, in which case the Fair
Market Price shall be determined in good faith by, and reflected
in a formal resolution of, the board of directors of the
Company. The Company acknowledges and agrees that this
Warrant was issued on the Issuance Date.
3.
Transferability and Exchange.
(a)
This Warrant, and the Common Stock issuable upon
the exercise hereof, may not be sold, transferred, pledged or
hypothecated unless the Company shall have been provided with an
opinion of counsel reasonably satisfactory to the Company that
such transfer is not in violation of the Securities Act, and any
applicable state securities laws. Subject to the
satisfaction of the aforesaid condition, this Warrant and the
underlying shares of Common Stock shall be transferable from
time to time by the Holders upon written notice to the Company.
If this Warrant is transferred, in whole or in part, the
Company shall, upon surrender of this Warrant to the Company,
deliver to each transferee a Warrant evidencing the rights of
such transferee to purchase the number of shares of Common Stock
that such transferee is entitled to purchase pursuant to such
transfer. The Company may place a legend similar to the
legend at the top of this Warrant on any replacement Warrant and
on each certificate representing shares issuable upon exercise
of this Warrant or any replacement Warrants. Only registered
Holders may enforce the provisions of this Warrant against the
Company. A transferee of the original registered Holders
becomes a registered Holder only upon delivery to the Company of
the original Warrant and an original Assignment, substantially
in the form set forth in Exhibit B attached hereto.
(b)
This Warrant is exchangeable upon its surrender
by the Holders to the Company for new Warrants of like tenor and
date representing in the aggregate the right to purchase the
number of shares purchasable hereunder, each of such new
Warrants to represent the right to purchase such number of
shares as may be designated by the Holders at the time of such
surrender (not to exceed the aggregate number of shares
underlying this Warrant).
4.
Adjustments to Exercise Price and Number of
Shares Subject to Warrant . The Exercise Price and the
number of shares of Common Stock purchasable upon the exercise
of this Warrant are subject to adjustment from time to time upon
the occurrence of any of the events specified in this Section 4.
For the purpose of this Section 4, “Common
Stock” means shares now or hereafter authorized of any
class of common stock of the Company, however designated, that
has the right to participate in any distribution of the assets
or earnings of the Company without limit as to per share amount
(excluding, and subject to any prior rights of, any class or
series of preferred stock).
(a)
In case the Company shall (i) pay a dividend or
make a distribution in shares of Common Stock to holders of
shares of Common Stock, (ii) subdivide its outstanding shares of
Common Stock into a greater number of shares, (iii) combine its
outstanding shares of Common Stock into a smaller number of
shares, or (iv) issue by reclassification of its shares of
Common Stock other securities of the Company, then the Exercise
Price in effect at the time of the record date for such dividend
or on the effective date of such subdivision, combination or
reclassification, and/or the number and kind of securities
issuable on such date, shall be proportionately adjusted so that
the Holders of the Warrant thereafter exercised shall be
entitled to receive the aggregate number and kind of shares of
Common Stock (or such other securities
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other than Common Stock) of the Company, at the
same aggregate Exercise Price, that, if such Warrant had been
exercised immediately prior to such date, the Holders would have
owned upon such exercise and been entitled to receive by virtue
of such dividend, distribution, subdivision, combination or
reclassification. Such adjustment shall be made
successively whenever any event listed above shall occur.
(b)
In case the Company shall fix a record date for
the making of a distribution to all holders of Common Stock
(including any such distribution made in connection with a
consolidation or merger in which the Company is the surviving
corporation) of cash, evidences of indebtedness or assets, or
subscription rights or warrants, the Exercise Price to be in
effect after such record date shall be determined by multiplying
the Exercise Price in effect immediately prior to such record
date by a fraction, the numerator of which shall be the Fair
Market Value per share of Common Stock on such
record date, less the amount of cash so to be distributed or the
Fair Market Value (as determined in good faith by, and reflected
in a formal resolution of, the board of directors of the
Company) of the portion of the assets or evidences of
indebtedness so to be distributed, or of such subscription
rights or warrants, applicable to one share of Common Stock, and
the denominator
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