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Exhibit
4.2
THIS WARRANT AND THE SHARES OF COMMON
STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE
SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS, OR FLO
CORPORATION SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL THAT
REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER
THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT
REQUIRED.
WARRANT TO
PURCHASE
SHARES OF COMMON
STOCK
OF
FLO
CORPORATION
Expires April 3,
2013
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No.:
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Number of Shares:
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| Date of
Issuance: April 3, 2008 |
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FOR VALUE RECEIVED, subject
to the provisions hereinafter set forth, the undersigned, FLO
Corporation, a Delaware corporation (together with its successors
and assigns, the “ Issuer ”), hereby certifies
that
or its registered assigns is entitled to subscribe for and
purchase, during the Term (as hereinafter defined), up to
(
) shares (subject to adjustment as hereinafter provided) of the
duly authorized, validly issued, fully paid and non-assessable
Common Stock of the Issuer, at an exercise price per share equal to
the Warrant Price then in effect, subject, however, to the
provisions and upon the terms and conditions hereinafter set forth.
Capitalized terms used in this Warrant and not otherwise defined
herein shall have the respective meanings specified in
Section 9 hereof.
1. Term . The term of
this Warrant shall commence on April 3, 2008 and shall expire
at 5:00 p.m., eastern time, on April 3, 2013 (such period, the
“ Term ”).
2. Method of Exercise;
Payment; Issuance of New Warrant; Transfer and Exchange
.
(a) Time of Exercise .
The purchase rights represented by this Warrant may be exercised in
whole or in part at any time during the Term.
(b) Method of Exercise
.
(i) The Holder hereof may
exercise this Warrant, in whole or in part, by the surrender of
this Warrant (with the exercise form attached hereto duly executed)
at the principal office of the Issuer, and by the payment to the
Issuer of an amount of consideration therefor equal to the Warrant
Price in effect on the date of such exercise multiplied by the
number of shares of Warrant Stock with respect to which this
Warrant is then being exercised, payable at
such Holder’s election
(A) by certified or official bank check or by wire transfer to
an account designated by the Issuer, (B) by “cashless
exercise” in accordance with subsection (ii) of this
Section 2(b), but only when there is no effective registration
statement under the Securities Act covering the resale of the
shares of Common Stock issuable upon exercise hereof or (C) by
a combination of the foregoing methods of payment selected by the
Holder of this Warrant.
(ii) Cashless Exercise
. Notwithstanding any provisions herein to the contrary, if at any
time after October 3, 2008, there is no effective registration
statement under the Securities Act covering the resale of the
shares of Common Stock issuable upon exercise hereof, then 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 computed using
the following formula:
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Where
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X = |
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the
number of shares of Common Stock to be issued to the
Holder; |
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Y = |
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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; |
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A = |
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the
Warrant Price; and |
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B = |
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the Per
Share Market Value of one share of Common Stock on the date of
exercise. |
(c) Issuance of Stock
Certificates . In the event of any exercise of the rights
represented by this Warrant in accordance with and subject to the
terms and conditions hereof, (i) certificates for the shares
of Warrant Stock so purchased shall be dated the date of such
exercise and delivered to the Holder hereof within a reasonable
time, not exceeding three (3) Trading Days after such exercise
or, at the request of the Holder (provided that a registration
statement under the Securities Act providing for the resale of the
Warrant Stock is then in effect), issued and delivered to the
Depository Trust Company (“ DTC ”) account on
the Holder’s behalf via the Deposit Withdrawal Agent
Commission System (“ DWAC ”) within a reasonable
time, not exceeding three (3) Trading Days after such
exercise, and the Holder hereof shall be deemed for all purposes to
be the holder of the shares of Warrant Stock so purchased as of the
date of such exercise, and (ii) unless this Warrant has
expired, a new Warrant representing the number of shares of Warrant
Stock, if any, with respect to which this Warrant shall not then
have been exercised (less any amount thereof which shall have been
canceled in payment or partial payment of the Warrant Price as
hereinabove provided) shall also be issued to the Holder hereof at
the Issuer’s expense within such time.
(d) Transferability of
Warrant . Subject to Section 2(f), this Warrant may be
transferred by a Holder without the consent of the Issuer. If
transferred pursuant to this paragraph and subject to the
provisions Section 2(f), this Warrant may be transferred on
the books of the Issuer by the Holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant at the
principal office of the Issuer, properly endorsed (by the Holder
executing an
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assignment in the form attached hereto)
and upon payment of any necessary transfer tax or other
governmental charge imposed upon such transfer. This Warrant is
exchangeable at the principal office of the Issuer for Warrants for
the purchase of the same aggregate number of shares of Warrant
Stock, each new Warrant to represent the right to purchase such
number of shares of Warrant Stock as the Holder hereof shall
designate at the time of such exchange. All Warrants issued on
transfers or exchanges shall be dated the Original Issue Date and
shall be identical with this Warrant except as to the number of
shares of Warrant Stock issuable pursuant hereto.
(e) Continuing Rights of
Holder . The Issuer will, at the time of or at any time after
each exercise of this Warrant, upon the request of the Holder
hereof, acknowledge in writing the extent, if any, of its
continuing obligation to afford to such Holder all rights to which
such Holder shall continue to be entitled after such exercise in
accordance with the terms of this Warrant, provided , that
if any such Holder shall fail to make any such request, the failure
shall not affect the continuing obligation of the Issuer to afford
such rights to such Holder.
(f) Compliance with
Securities Laws .
(i) The Holder of this
Warrant, by acceptance hereof, acknowledges that this Warrant or
the shares of Warrant Stock to be issued upon exercise hereof are
being acquired solely for the Holder’s own account and not as
a nominee for any other party, and not with a view to or in
connection with a distribution, and that the Holder will not offer,
sell or otherwise dispose of this Warrant or any shares of Warrant
Stock to be issued upon exercise hereof except pursuant to an
effective registration statement, or an exemption from
registration, under the Securities Act and any applicable state
securities laws.
(ii) Except as provided in
paragraph (iii) below, this Warrant and all certificates
representing shares of Warrant Stock issued upon exercise hereof
shall be stamped or imprinted with a legend in substantially the
following form:
THIS WARRANT AND THE SHARES
OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”) OR ANY STATE SECURITIES LAWS AND MAY
NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED
UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS
OR FLO CORPORATION SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL
THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND
UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT
REQUIRED.
(iii) The restrictions
imposed by this subsection (f) upon the transfer of this
Warrant or the shares of Warrant Stock to be purchased upon
exercise hereof shall terminate (A) when such Securities shall
have been resold pursuant to an effective registration statement
under the Securities Act, (B) upon the Issuer’s receipt
of an
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opinion of counsel, in form
and substance reasonably satisfactory to the Issuer, addressed to
the Issuer to the effect that such restrictions are no longer
required to ensure compliance with the Securities Act and state
securities laws or (C) upon the Issuer’s receipt of
other evidence reasonably satisfactory to the Issuer that such
registration and qualification under the Securities Act and state
securities laws are not required, which shall be deemed to include
a customary Rule 144 representation letter from the Holder.
Whenever such restrictions shall cease and terminate as to any such
Securities, the Holder thereof shall be entitled to receive from
the Issuer (or its transfer agent and registrar), without expense
(other than applicable transfer taxes, if any), new Warrants (or,
in the case of shares of Warrant Stock, new stock certificates) of
like tenor not bearing the applicable legend required by paragraph
(ii) above relating to the Securities Act and state securities
laws.
3. Stock Fully Paid;
Reservation and Listing of Shares; Covenants .
(a) Stock Fully Paid .
The Issuer represents, warrants, covenants and agrees that all
shares of Warrant Stock which may be issued upon the exercise of
this Warrant or otherwise hereunder will, upon issuance, be duly
authorized, validly issued, fully paid and non-assessable and free
from all taxes, liens and charges created by or through Issuer. The
Issuer further covenants and agrees that during the period within
which this Warrant may be exercised, the Issuer will at all times
have authorized and reserved for the purpose of the issue upon
exercise of this Warrant a sufficient number of shares of Common
Stock to provide for the exercise of this Warrant.
(b) Reservation . If
any shares of Common Stock required to be reserved for issuance
upon exercise of this Warrant or as otherwise provided hereunder
require registration or qualification with any governmental
authority under any federal or state law before such shares may be
so issued, the Issuer will in good faith use commercially
reasonable efforts as expeditiously as possible at its expense to
cause such shares to be duly registered or qualified. If the Issuer
shall list any shares of Common Stock on any securities exchange or
market, it will, at its expense, list thereon, maintain and
increase when necessary such listing of all shares of Warrant Stock
from time to time issued upon exercise of this Warrant or as
otherwise provided hereunder (provided that such Warrant Stock has
been registered pursuant to a then-effective registration statement
under the Securities Act), and, to the extent permissible under the
applicable securities exchange rules, all unissued shares of
Warrant Stock which are at any time issuable hereunder, so long as
any shares of Common Stock shall be so listed. The Issuer will also
so list on each securities exchange or market, and will maintain
such listing of, any other Securities which the Holder of this
Warrant shall be entitled to receive upon the exercise of this
Warrant if at the time any Securities of the same class shall be
listed on such securities exchange or market by the
Issuer.
(c) Covenants . The
Issuer shall not by any action including, without limitation,
amending the Certificate of Incorporation or Bylaws of the Issuer
or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of Securities or any other
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 the Holder hereof against impairment. Without limiting
the generality of the foregoing, the Issuer will
(i) not
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permit the par value, if any, of its
Common Stock to exceed the then-effective Warrant Price,
(ii) not amend or modify any provision of the Certificate of
Incorporation or Bylaws of the Issuer in any manner that would
adversely affect the rights of the Holders of the Warrants,
(iii) take all such action as may be reasonably necessary in
order that the Issuer may validly and legally issue fully paid and
nonassessable shares of Common Stock, free and clear of any liens,
claims, encumbrances and restrictions (other than as provided
herein or under applicable securities laws) upon the exercise of
this Warrant, and (iv) use commercially reasonable efforts to
obtain all such authorizations, exemptions or consents from any
public regulatory body having jurisdiction thereof as may be
reasonably necessary to enable the Issuer to perform its
obligations under this Warrant.
(d) Loss, Theft,
Destruction of Warrants . Upon receipt of evidence satisfactory
to the Issuer of the ownership of and the loss, theft, destruction
or mutilation of any Warrant and, in the case of any such loss,
theft or destruction, upon receipt of indemnity or security
satisfactory to the Issuer or, in the case of any such mutilation,
upon surrender and cancellation of such Warrant, the Issuer will
make and deliver, in lieu of such lost, stolen, destroyed or
mutilated Warrant, a new Warrant of like tenor and representing the
right to purchase the same number of shares of Common
Stock.
4. Adjustment of Warrant
Price . The price at which shares of Common Stock for which
this Warrant is exercisable may be purchased upon exercise of this
Warrant shall be subject to adjustment from time to time as set
forth in this Section 4. The Issuer shall give the Holder
notice of any event described below which requires an adjustment
pursuant to this Section 4 in accordance with
Section 5.
(a) Recapitalization,
Reorganization, Reclassification, Consolidation, Merger or Sale
.
(i) In case the Issuer after
the Original Issue Date shall do any of the following (each, a
“ Triggering Event ”): (a) consolidate with
or merge into any other Person and the Issuer shall not be the
continuing or surviving corporation of such consolidation or
merger, or (b) permit any other Person to consolidate with or
merge into the Issuer and the Issuer shall be the continuing or
surviving Person but, in connection with such consolidation or
merger, any Capital Stock of the Issuer shall be changed into or
exchanged for securities of any other Person or cash or any other
property, or (c) transfer all or substantially all of its
properties or assets to any other Person, or (d) effect a
capital reorganization or reclassification of its Capital Stock,
then, and in the case of each such Triggering Event, proper
provision shall be made so that, upon the basis and the terms and
in the manner provided in this Warrant, the Holder of this Warrant
shall be entitled upon the exercise hereof at any time after the
consummation of such Triggering Event, to the extent this Warrant
is not exercised prior to such Triggering Event, to receive at the
Warrant Price in effect at the time immediately prior to the
consummation of such Triggering Event in lieu of the Common Stock
issuable upon such exercise of this Warrant prior to such
Triggering Event, the securities, cash and property to which such
Holder would have been entitled upon the consummation of such
Triggering Event if such Holder had exercised the rights
represented by this Warrant immediately prior thereto, subject to
adjustments (subsequent to such corporate action) as nearly
equivalent as possible to the adjustments provided for elsewhere in
this Section 4.
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(ii) Notwithstanding anything
contained in this Warrant to the contrary, a Triggering Event shall
not be deemed to have occurred if, prior to the consummation
thereof, each Person (other than the Issuer) which may be required
to deliver any securities, cash or property upon the exercise of
this Warrant as provided herein shall assume, by written instrument
delivered to, and reasonably satisfactory to, the Holder of this
Warrant, (A) the obligations of the Issuer under this Warrant
(and if the Issuer shall survive the consummation of such
Triggering Event, such assumption shall be in addition to, and
shall not release the Issuer from, any continuing obligations of
the Issuer under this Warrant) and (B) the obligation to
deliver to such Holder such securities, cash or property as, in
accordance with the foregoing provisions of this subsection (a),
such Holder shall be entitled to receive, and such Person shall
have similarly delivered to such Holder an opinion of counsel for
such Person, which counsel shall be reasonably satisfactory to such
Holder, or in the alternative, a written acknowledgement executed
by the President or Chief Financial Officer of the Issuer, stating
that this Warrant shall thereafter continue in full force and
effect and the terms hereof (including, without limitation, all of
the provisions of this subsection (a)) shall be applicable to the
securities, cash or property which such Person may be required to
deliver upon any exercise of this Warrant or the exercise of any
rights pursuant hereto.
(b) Stock Dividends,
Subdivisions and Combinations . If at any time the Issuer
shall:
(i) take a record of the
holders of its Common Stock for the purpose of entitling them to
receive a dividend payable in, or other distribution of, shares of
Common Stock,
(ii) subdivide its
outstanding shares of Common Stock into a larger number of shares
of Common Stock, or
(iii) combine its outstanding
shares of Common Stock into a smaller number of shares of Common
Stock,
then (1) the number of shares of
Common Stock for which this Warrant is exercisable immediately
after the occurrence of any such event shall be adjusted to equal
the number of shares of Common Stock which a record holder of the
same number of shares of Common Stock for which this Warrant is
exercisable immediately prior to the occurrence of such event would
own or be entitled to receive after the happening of such event,
and (2) the Warrant Price then in effect shall be adjusted to
equal (A) the Warrant Price then in effect multiplied by the
number of shares of Common Stock for which this Warrant is
exercisable immediately prior to the adjustment divided by
(B) the number of shares of Common Stock for which this
Warrant is exercisable immediately after such
adjustment.
(c) Certain Other
Distributions . If at any time the Issuer shall take a record
of the holders of its Common Stock for the purpose of entitling
them to receive any dividend or other distribution of:
(i) cash (other than a cash
dividend payable out of earnings or earned surplus legally
available for the payment of dividends under the laws of the
jurisdiction of incorporation of the Issuer),
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(ii) any evidences of its
indebtedness, any shares of stock of any class or any other
securities or property of any nature whatsoever (other than cash,
Common Stock Equivalents or Additional Shares of Common Stock),
or
(iii) any warrants or other
rights to subscribe for or purchase any evidences of its
indebtedness, any shares of stock of any class or any other
securities or property of any nature whatsoever (other than cash,
Common Stock Equivalents or Additional Shares of Common
Stock),
then (1) the number of shares of
Common Stock for which this Warrant is exercisable shall be
adjusted to equal the product of the number of shares of Common
Stock for which this Warrant is exercisable immediately prior to
such adjustment multiplied by a fraction (A) the numerator of
which shall be the Per Share Market Value of Common Stock at the
date of taking such record and (B) the denominator of which
shall be such Per Share Market Value minus the amount allocable to
one share of Common Stock of any such cash so distributable and of
the fair value (as determined in good faith by the Board) of any
and all such evidences of indebtedness, shares of stock, other
securities or property or warrants or other subscription or
purchase rights so distributable, and (2) the Warrant Price
then in effect shall be adjusted to equal (A) the Warrant
Price then in effect multiplied by the number of shares of Common
Stock for which this Warrant is exercisable immediately prior to
the adjustment divided by (B) the number of shares of Common
Stock for which this Warrant is exercisable immediately after such
adjustment. A reclassification of the Common Stock (other than a
change in par value, or from par value to no par value or from no
par value to par value) into shares of Common Stock and shares of
any other class of stock shall be deemed a distribution by the
Issuer to the holders of its Common Stock of such shares of such
other class of stock within the meaning of this Section 4(c)
and, if the outstanding shares of Common Stock shall be changed
into a larger or smaller number of shares of Common Stock as a part
of such reclassification, such change shall be deemed a subdivision
or combination, as the case may be, of the outstanding shares of
Common Stock within the meaning of Section 4(b).
(d) Issuance of Additional
Shares of Common Stock .
(i) In the event the Issuer
shall at any time issue any Additional Shares of Common Stock
(otherwise than as provided in the foregoing subsections
(b) through (c) of this Section 4 and other than
Permitted Issuances) at a price per share less than the Warrant
Price then in effect or without consideration, then the Warrant
Price upon each such issuance shall be reduced to a price equal to
the per share price paid for such additional shares of Common
Stock; provided , however , that, notwithstanding the
foregoing, if, subsequent to the Original Issue Date and prior to
such issuance and sale, the Issuer shall have completed an equity
or equity-linked financing with gross proceeds in an amount of at
least $10 million at a price of at least $1.00 per share, then the
Warrant Price upon such issuance shall be adjusted to that price
(rounded to the nearest cent) determined by multiplying the Warrant
Price then in effect by a fraction:
(A)
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