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Exhibit 10.2
THE SECURITIES REPRESENTED BY THIS WARRANT HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (“1933 ACT”) OR ANY STATE
SECURITIES LAWS. SUCH SECURITIES MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION THEREFROM UNDER THE 1933 ACT AND ANY APPLICABLE
STATE SECURITIES LAWS.
2007-001
WARRANT TO PURCHASE SHARES
OF THE COMMON STOCK OF
GLOBAL REALTY DEVELOPMENT CORP.
(Void after Expiration Date – July
[ ], 2012)
Warrant
Number:
Number
of Shares of Common Stock:
[ ]
Issue
Date: July
[ ],
2007 (“ Issuance Date
”)
This
certifies that [________________________] or its successors or
assigns (“ Holder ”)
shall be entitled to purchase from GLOBAL REALTY
DEVELOPMENT CORP. , a Delaware corporation (“
Company ”), having its
principal place of business at 11555 Heron Bay Boulevard,
Suite 200, Coral Springs, Florida 33076,
[_____________________] [(_______)] fully paid and
non-assessable shares of the Company’s common stock, par
value $.001 per share (“ Common
Stock ”), at a price per share equal to
the Exercise Price (as defined below) (the “
Warrant Shares ”). Capitalized
terms used herein and not otherwise defined shall have the
respective meanings set forth in the related Note and Warrant
Purchase Agreement (the “ Purchase
Agreement ”), 12% Senior Promissory Notes
(individually, a “ Note
” and collectively, the “
Notes ”), and the Registration
Rights Agreement (the “ Registration Rights
Agreement ”), each entered into or issued
in connection with this warrant (“
Warrant ”).
This
Warrant is being issued to the Holder in connection with up to
a $6,000,000 Loan evidenced by the Notes, which are due and
payable one hundred and eighty (180) days (unless extended by
the Company for up to an additional 180 days) from the date of
issuance. This Warrant is one of several which will
be identical except for names and amounts. An
aggregate of up to 18,000,000 Initial Warrants (as defined
below) will be issued by the Company if the full $6,000,000
Loan is completed. The Initial Warrants are being
issued on the basis of three (3) warrants for every $1.00 of
Notes issued by the Company (the “ Initial
Warrants ”). In addition to the
Initial Warrants, each Offering Unit includes an additional
warrant (the “ Additional
Warrant ”) to purchase one (1) share of
Common Stock for each Offering Unit. The Additional
Warrants are identical in all terms to the Initial Warrants
(together, the “ Warrants
”), except that the Additional Warrants are escrowed
with an Escrow Agent and will be distributed to the Note
Holders only upon an Event of Default or a Registration
Failure.
The
initial exercise price (“ Exercise
Price” ) of this Warrant will be equal to
$0.45 per share, subject to adjustment upon the occurrence of
the events described in Section 2 of this
Warrant.
This
Warrant shall be immediately exercisable into shares of Common
Stock at any time, or from time-to-time, up to and including
5:00 p.m. (New York time) on July [ ], 2012
(“ Expiration Date ”);
provided, however, if such date is not a Business Day, then on
the Business Day immediately following such
date. This Warrant is exercisable in whole or in
part upon the surrender to the Company at its principal place
of business (or at such other location as the Company may
advise the Holder in writing) of this Warrant properly
endorsed with a form of exercise notice substantially the form
attached hereto as Exhibit A (the
“ Exercise
Notice ”
) duly filled in and signed and, if applicable, upon
payment in cash or by wire transfer of immediately available
funds of an amount equal to the applicable Exercise Price
multiplied by the number of Common Stock as to which this
Warrant is being exercised (the “Aggregate
Exercise Price” ).
1.
Exercise; Issuance of Certificates; Payment for
Shares.
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1.1
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General. This Warrant is exercisable in full,
or in part for 5,000 or more shares, in increments of 5,000 shares,
except for the final exercise which may be for the remainder, at
the option of the Holder of record at any time or from time, to
time, up to the Expiration Date for all of the shares of Common
Stock (but not for a fraction of a share) which may be purchased
hereunder. In the case of the exercise of less than all
of the Warrant Shares represented hereby, the Company shall cancel
this warrant certificate upon the surrender hereof and shall
execute and deliver a new warrant certificate or warrant
certificates of like tenor for the balance of such Warrant Shares.
The
Company agrees that the shares of Common Stock purchased under this
Warrant shall be and are deemed to be issued to the Holder hereof
as the record owner of such shares as of the close of business on
the date on which the Exercise Notice is delivered to the Company
via facsimile; provided, however, that in such case this Warrant
shall be surrendered to the Company within three (3) Business
Days. Certificates for the shares of Common Stock so
purchased, together with any other securities or property to which
the Holder is entitled upon such exercise, shall be delivered to
the Holder by the Company at the Company’s expense within a
reasonable time after the rights represented by this Warrant have
been so exercised, and in any event, within three (3) Business Days
of such exercise and delivery of the Exercise Price. The Company
shall, issue and deliver to the transfer agent for its Common Stock
(the “Transfer Agent ”)
irrevocable instructions to issue and deliver or cause to be
delivered to such Holder the number of Warrant Shares
exercised. Each Common Stock certificate so delivered
shall be in such denominations of 5,000 or more shares of Common
Stock, in increments of 5,000, as may be requested by the Holder
hereof and shall be registered on the Company’s books in the
name designated by such Holder, provided that no Holder of this
Warrant shall be permitted to exercise any warrants to the extent
that such exercise would cause any Holder to be the beneficial
owner of 5% or more of the then outstanding Company’s Common
Stock, at that given time. This limitation shall not be
deemed to prevent any Holder from acquiring more than an aggregate
of 5% of the Common Stock, so long as such Holder does not
beneficially own, or have the right to beneficially own, 5% or more
of the Company’s Common Stock at any given time.
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This
Warrant may be exercised, in whole at any time or in part from
time to time, commencing on the date hereof and prior to 5:00
P.M., New York time, on
July [ ],
2012, by the Holder by the facsimile delivery of the Exercise
Notice on the date of the exercise and by surrender of this
Warrant within three (3) Business Days from the exercise day
at the address set forth hereof, together with proper payment
of the Aggregate Exercise Price payable hereunder for the
Warrant Shares, or the proportionate part thereof if this
Warrant is exercised in part. Payment for the
Warrant Shares shall be made in cash or by wire transfer of
immediately available fund. If this Warrant is
exercised in part, this Warrant must be exercised for a number
of whole shares of the Common Stock, and the Holder is
entitled to receive a new Warrant covering the Warrant Shares
which have not been exercised and setting forth the
proportionate part of the Aggregate Exercise Price applicable
to such Warrant Shares. Upon such surrender of this
Warrant the Company will (a) issue a certificate or
certificates in the name of the Holder for the largest number
of whole shares of the Common Stock to which the Holder shall
be entitled and (b) deliver the other securities and
properties receivable upon the exercise of this Warrant, or
the proportionate part thereof if this Warrant is exercised in
part, pursuant to the provisions of this Warrant.
In
the event the Holder’s Note issued together with this
Warrant is not paid on or before Maturity Date, the Holder may
pay the Exercise Price through a cashless exercise (a “
Cashless Exercise ”),
as hereinafter provided. The Holder may effect a
Cashless Exercise in lieu of making payment of the Aggregate
Exercise Price in cash or wire transfer and, elect instead to
receive upon such exercise the “Net Number” of
shares of Common Stock determined according to the following
formula:
X = Y x
(A-B)/A
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X
= the Net Number of Warrant Shares to be issued to the
Holder;
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Y
= the number of Warrant Shares with respect to which this Warrant
is being exercised;
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A
= the Market Price (as defined in the Section 2.4 below) as of the
Exercise Date; and
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For
purposes of Rule 144, it is intended and acknowledged that the
Warrant Shares issued in a Cashless Exercise transaction shall
be deemed to have been acquired by the Holder, and the holding
period for the Warrant Shares required by Rule 144 shall be
deemed to have been commenced, on the Issuance
Date.
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1.4
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Shares to be Fully Paid; Reservation of
Shares . The Company
covenants and agrees that all shares of Common Stock which may be
issued upon the exercise of the rights represented by this Warrant
will, upon issuance, be duly authorized, validly issued, fully paid
and nonassessable and free from all preemptive rights of any
shareholder and free of all taxes, liens and charges with respect
to the issue thereof. The Company further covenants and
agrees that, during the period within which the rights represented
by this Warrant may be exercised, the Company will at all times
have authorized and reserved, for the purpose of issue or transfer
upon exercise of the subscription rights evidenced by this Warrant,
a sufficient number of shares of authorized but unissued Common
Stock, when and as required to provide for the exercise of the
rights represented by this Warrant. The Company will
take all such action as may be necessary to assure that such shares
of Common Stock may be issued as provided herein without violation
of any applicable law or regulation, or of any requirements of any
domestic securities exchange upon which the Common Stock or other
securities may be listed; provided, however, that the Company shall
not be required to effect a registration under federal or state
securities laws with respect to such exercise other than as
required by Section 7.7 herein. The Company will not
take any action which would result in any adjustment of the
Exercise Price if the total number of shares of Common Stock
issuable after such action upon exercise of all outstanding
warrants, together with all shares of Common Stock then outstanding
and all shares of Common Stock then issuable upon exercise of all
options and upon the conversion of all convertible securities then
outstanding, would exceed the total number of shares of Common
Stock or equity securities then authorized by the Company’s
Certificate of Incorporation, as amended (“
Company Charter ”).
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1.5
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Buy In. In addition to any other rights available to a
Holder, if the Company fails to deliver to the Holder a certificate
representing Warrant Shares by the third Trading Day after the date
on which delivery of such certificate is required by this Warrant,
and if after such third Trading Day the Holder purchases (in an
open market transaction or otherwise) shares of Common Stock to
deliver in satisfaction of a sale by the Holder on or after the
Exercise Date of the Warrant Shares that the Holder anticipated
receiving from the Company (a
“Buy-In” ), then the Company
shall, within three Trading Days after the Holder’s request
and in the Holder’s discretion, either (i) pay cash to the
Holder in an amount equal to the Holder’s total purchase
price (including brokerage commissions, if any) for the shares of
Common Stock so purchased (the “Buy-In
Price” ), at which point the
Company’s obligation to deliver such certificate (and to
issue such Common Stock) shall terminate, or (ii) promptly honor
its obligation to deliver to the Holder a certificate or
certificates representing such Common Stock and pay cash to the
Holder in an amount equal to the excess (if any) of the Buy-In
Price over the product of (A) such number of shares of Common
Stock, times (B) the closing price on the date of the event giving
rise to the Company’s obligation to deliver such
certificate. Notwithstanding the foregoing, the Company
shall have no liability under this subsection for the Buy-In Price
if it has complied with the requirements of subsection 1.1 above
and notwithstanding it using its best efforts to have the Transfer
Agent deliver the Warrant Shares to the Holders within three (3)
trading days of the Holder’s request such Warrant Shares are
not delivered on a timely basis.
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2.
Determination or Adjustment of Exercise Price and Number of
Shares. The Exercise Price and the number of
shares purchasable upon the exercise of this Warrant shall be
subject to adjustment from time to time upon the occurrence of
certain events described in this Section 2. 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.
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2.1
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Subdivision or Combination of Common Stock. In
case the Company shall at any time subdivide or reclassify its
outstanding shares of Common Stock into a greater number of shares,
the Exercise Price in effect immediately prior to such subdivision
shall be proportionately reduced, and conversely, in case the
outstanding shares of Common Stock of the Company shall be combined
or reclassified into a smaller number of shares, the Exercise Price
in effect immediately prior to such combination shall be
proportionately increased.
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2.2
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Dividends in Common Stock, Other Stock, Property,
Reclassification . If at any time or from time
to time the holders of Common Stock (or any shares of stock or
other securities at the time receivable upon the exercise of this
Warrant) shall have received or become entitled to receive, without
payment therefore:
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2.2.1
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Stock,
Common Stock or any shares of capital stock or other securities
which are at any time directly or indirectly convertible into or
exchangeable for Common Stock, or any rights or options to
subscribe for, purchase or otherwise acquire any of the foregoing
by way of dividend or other distribution,
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2.2.2
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Any
cash paid or payable otherwise than as a cash dividend,
or
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2.2.3
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Stock,
Common Stock or additional capital stock or other securities or
property (including cash) by way of spinoff, split-up,
reclassification, combination of shares or similar corporate
rearrangement, (other than shares of Common Stock issued as a stock
split or adjustments in respect of which shall be covered by the
terms of Section 2.1 above), then and in each such case, the Holder
hereof shall, upon the exercise of this Warrant, be entitled to
receive, in addition to the number of shares of Common Stock or
other capital stock receivable thereupon, and without payment of
any additional consideration therefore, the amount of stock and
other securities and property (including cash in the cases referred
to in clause (2.2.2) above and this clause (2.2.3)) which such
Holder would hold on the date of such exercise had he been the
holder of record of such Common Stock as of the date on which
holders of Common Stock received or became entitled to receive such
shares or all other additional stock and other securities and
property.
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2.3
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Reorganization, Reclassification, Consolidation, Merger or
Sale .
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2.3.1
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If
any recapitalization, reclassification or reorganization of the
capital stock of the Company, or any consolidation or merger of the
Company with another corporation, or the sale of all or
substantially all of its assets or other transaction shall be
effected in such a way that holders of Common Stock shall be
entitled to receive stock, securities, or other assets or property
(an “ Organic Change ”),
then, as a condition of such Organic Change, lawful and adequate
provisions shall be made by the Company whereby the Holder hereof
shall thereafter have the right, upon exercise of this Warrant, to
purchase and receive (in lieu of the shares of the Common
Stock of the Company immediately theretofore purchasable and
receivable upon the exercise of the rights represented by this
Warrant) such shares of stock, securities or other assets or
property as may be issued or payable with respect to or in exchange
for a number of outstanding shares of such Common Stock equal to
the number of shares of such stock immediately theretofore
purchasable and receivable upon the exercise of the rights
represented by this Warrant. In the event of any Organic
Change, appropriate provision shall be made by the Company with
respect to the rights and interests of the Holder of this Warrant
to the end that the provisions hereof (including, without
limitation, provisions for adjustments of the Exercise Price and of
the number of shares purchasable and receivable upon the exercise
of this Warrant) shall thereafter be applicable, in relation to any
shares of stock, securities or assets thereafter deliverable upon
the exercise hereof. The Company will not effect any such
consolidation, merger or sale unless, prior to the consummation
thereof, the successor corporation (if other than the Company)
resulting from such consolidation or the corporation purchasing
such assets shall assume by written instrument executed and mailed
or delivered to the Holder hereof at the last address of such
Holder appearing on the books of the Company, the obligation to
deliver to such Holder, upon Holder’s exercise of this
Warrant and payment of the purchase price in accordance with the
terms hereof, such shares of stock, securities or assets as, in
accordance with the foregoing provisions, such Holder may be
entitled to purchase.
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2.3.2
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No
adjustment of the Exercise Price, however, shall be made in an
amount less than $.01 per share, but any such lesser adjustment
sh
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