EXHIBIT 4.40
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT, AS AMENDED, OR ANY OTHER APPLICABLE SECURITIES LAWS AND
HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A
TRANSACTION THAT IS EXEMPT FROM SUCH REGISTRATION.
NO. 2-3
STOCK PURCHASE WARRANT
To Purchase 20,485 Shares of Common Stock of
FIBERCORE, INC.
THIS CERTIFIES that, for value received, FOREVERGREEN PARTNERS (the
"Holder"), is entitled, upon the terms and subject to the limitations on
exercise and the conditions hereinafter set forth, at any time on or after June
6, 2002 (the "Initial Exercise Date") and on or prior to the close of business
on the fourth anniversary of the Initial Exercise Date (the "Termination Date")
but not thereafter, to subscribe for and purchase from Fibercore, Inc., a
corporation incorporated in the State of Nevada (the "Company"), up to 20,485
shares (the "Warrant Shares") of Common Stock, par value $.001 per share, of the
Company (the "Common Stock"). The purchase price of one share of Common Stock
(the "Exercise Price") under this Warrant shall be $0.6102, subject to
adjustment hereunder. The Exercise Price and the number of Warrant Shares for
which the Warrant is exercisable shall be subject to adjustment as provided
herein. Capitalized terms used and not otherwise defined herein shall have the
meanings set forth in that certain Convertible Subordinated Debentures and
Warrants Purchase Agreement (the "Purchase Agreement"), dated January 15, 2002,
between the Company and the investors signatory thereto.
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1. Title to Warrant. Prior to the Termination Date and subject to
compliance with applicable laws, this Warrant and all rights hereunder are
transferable, in whole or in part, at the office or agency of the Company by the
Holder in person or by duly authorized attorney, upon surrender of this Warrant
together with the Assignment Form annexed hereto properly endorsed.
2. Authorization of Shares. The Company covenants that all Warrant Shares
which may be issued upon the exercise of the purchase rights represented by this
Warrant will, upon exercise of the purchase rights represented by this Warrant,
be duly authorized, validly issued, fully paid and nonassessable and free from
all taxes, liens and charges in respect of the issue thereof (other than taxes
in respect of any transfer occurring contemporaneously with such issue).
3. Exercise of Warrant.
(a) Except as provided in Section 4 herein, exercise of the purchase
rights represented by this Warrant may be made at any time or times on or
after the Initial Exercise Date and on or before the Termination Date by
the surrender of this Warrant and the Notice of Exercise Form annexed
hereto duly executed, at the office of the Company (or such other office or
agency of the Company as it may designate by notice in writing to the
registered Holder at the address of such Holder appearing on the books of
the Company) and upon payment of the Exercise Price of the shares thereby
purchased by wire transfer or cashier's check drawn on a United States
bank, the Holder shall be entitled to receive a certificate for the number
of Warrant Shares so purchased. Certificates for shares purchased hereunder
shall be delivered to the Holder within four (4) Trading Days after the
date on which this Warrant shall have been exercised as aforesaid. This
Warrant shall be deemed to have been exercised and such certificate or
certificates shall be deemed to have been issued, and Holder or any other
person so designated to be named therein shall be deemed to have become a
holder of record of such shares for all purposes, as of the date the
Warrant has been exercised by payment to the Company of the Exercise Price
and all taxes required to be paid by the Holder, if any, pursuant to
Section 5 prior to the issuance of such shares, have been paid. If the
Company fails to deliver to the Holder a certificate or certificates
representing the Warrant Shares pursuant to this Section 3(a) by the third
Trading Day after the date of exercise, then the Holder will have the right
to rescind such exercise. In addition to any other rights available to the
Holder, (i) if the Holder sells the shares it has exercised and the Holder
has provided the Company evidence of such sale reasonably satisfactory to
the Company (the "Sale"), and (ii) if the Company fails to deliver to the
Holder such certificate or certificates by the 5th Trading Day after the
date the Holder exercises this Warrant, and if after such 5th Trading Day
the Holder purchases (in an open market transaction or otherwise) Common
Stock to deliver in satisfaction of a sale by such Holder of the Warrant
Shares which the Holder anticipated receiving upon such exercise (a
"Buy-In"), then the Company shall (A) pay in cash to the Holder (in
addition to any remedies available to or elected by the Holder) the amount
by which (x) the Holder's total purchase price (including brokerage
commissions, if any) for the Common Stock so purchased exceeds (y) the
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product of (1) the aggregate number of shares of Common Stock that such
Holder anticipated receiving from the exercise at issue multiplied by (2)
the per share price at which the Common Stock was sold pursuant to the
Sale, and (B) at the option of the Holder, (x) deliver the Warrant Shares
not yet delivered pursuant to such exercise and subject to this provision,
or (y) reinstate the portion of this Warrant for which such exercise was
not honored. For example, if the Holder purchases Common Stock having a
total purchase price of $11,000 to cover a Buy-In with respect to an
attempted exercise of this Warrant with respect to which the market price
of the Warrant Shares on the date of exercise was a total of $10,000, the
Company shall be required to pay the Holder $1,000. The Holder shall
provide the Company written notice indicating the amounts payable to the
Holder in respect of the Buy-In and the basis for determining such amount.
Nothing herein shall limit the Holder's right to pursue any other remedies
available to it hereunder, at law or in equity, including, without
limitation, a decree of specific performance and/or injunctive relief with
respect to the Company's failure to timely deliver certificates
representing shares of Common Stock upon exercise of this Warrant as
required pursuant to the terms hereof.
(b) If this Warrant shall have been exercised in part, the Company
shall, at the time of delivery of the certificate or certificates
representing Warrant Shares, deliver to Holder a new Warrant evidencing the
rights of Holder to purchase the unpurchased Warrant Shares called for by
this Warrant, which new Warrant shall in all other respects be identical
with this Warrant.
(c) Notwithstanding anything herein to the contrary, in no event shall
the Holder be permitted to exercise this Warrant for Warrant Shares to the
extent that (i) the number of shares of Common Stock owned by such Holder
(other than Warrant Shares issuable upon exercise of this Warrant) plus
(ii) the number of Warrant Shares issuable upon exercise of this Warrant,
would be equal to or exceed 4.9999% of the number of shares of Common Stock
then issued and outstanding, including shares issuable upon exercise of
this Warrant held by such Holder after application of this Section 3(c). As
used herein, beneficial ownership shall be determined in accordance with
Section 13(c) of the Exchange Act. To the extent that the limitation
contained in this Section 3(c) applies, the determination of whether this
Warrant is exercisable (in relation to other securities owned by the
Holder) and of which a portion of this Warrant is exercisable shall be in
the sole discretion of such Holder, and the submission of a Notice of
Exercise shall be deemed to be such Holder's determination of whether this
Warrant is exercisable (in relation to other securities owned by such
Holder) and of which portion of this Warrant is exercisable, in each case
subject to such aggregate percentage limitation, and the Company shall have
no obligation to verify or confirm the accuracy of such determination.
Nothing contained herein shall be deemed to restrict the right of a Holder
to exercise this Warrant into Warrant Shares at such time as such exercise
will not violate the provisions of this Section 3(c). The provisions of
this Section 3(c) may be waived by the Holder upon, at the election of the
Holder, not less than 61 days' prior notice to the Company, and the
provisions of this Section 3(c) shall continue to apply until such 61st day
(or such later date, as determined by the Holder, as may be specified in
such notice of waiver). No exercise of this Warrant in violation of this
Section 3(c) but otherwise in accordance with this Warrant shall affect the
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status of the Warrant Shares as validly issued, fully-paid and
nonassessable.
(d) At anytime beginning one (1) year from the date this Warrant is
issued, in the event that the Registration Statement registering the
Warrant Shares issuable hereunder is not then effective, this Warrant may
also be exercised by means of a "cashless exercise" in which the Holder
shall be entitled to receive a certificate for the number of Warrant Shares
equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A) = the average of the high and low trading prices per share of
Common Stock on the Trading Day preceding the date of such
election;
(B) = the Exercise Price of the Warrants; and
(X) = the number of Warrant Shares issuable upon exercise of the
Warrants in accordance with the terms of this Warrant.
4. No Fractional Shares or Scrip. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant. As to any fraction of a share which Holder would otherwise be entitled
to purchase upon such exercise, the Company shall pay a cash adjustment in
respect of such final fraction in an amount equal to such fraction multiplied by
the Exercise Price.
5. Charges, Taxes and Expenses. Issuance of certificates for Warrant Shares
shall be made without charge to the Holder for any issue or transfer tax or
other incidental expense in respect of the issuance of such certificate, all of
which taxes and expenses shall be paid by the Company, and such certificates
shall be issued in the name of the Holder or in such name or names as may be
directed by the Holder; provided, however, that in the event certificates for
Warrant Shares are to be issued in a name other than the name of the Holder,
this Warrant when surrendered for exercise shall be accompanied by the
Assignment Form attached hereto duly executed by the Holder; and the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it
for any transfer tax incidental thereto.
6. Closing of Books. The Company will not close its stockholder books or
records in any manner which prevents the timely exercise of this Warrant.
7. Transfer, Division and Combination.
(a) Subject to compliance with any applicable securities laws,
transfer of this Warrant and all rights hereunder, in whole or in part,
shall be registered on the books of the Company to be maintained for such
purpose, upon surrender of this Warrant at the principal office of the
Company, together with a written assignment of this Warrant substantially
in the form attached hereto duly executed by the Holder or its agent or
attorney and funds sufficient to pay any transfer taxes payable upon the
making of such transfer. In the event that the Holder wishes to transfer a
portion of this Warrant, the Holder shall transfer at least 100,000 shares
underlying this Warrant to any such transferee. Upon such surrender and, if
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required, such payment, the Company shall execute and deliver a new Warrant
or Warrants in the name of the assignee or assignees and in the
denomination or denominations specified in such instrument of assignment,
and shall issue to the assignor a new Warrant evidencing the portion of
this Warrant not so assigned, and this Warrant shall promptly be cancelled.
A Warrant, if properly assigned, may be exercised by a new holder for the
purchase of Warrant Shares without having a new Warrant issued.
Notwithstanding any provision herein, the Holder shall not sell, assign,
pledge, encumber, or otherwise transfer this Warrant or any rights
hereunder to any person or entity without the consent of the Company, which
consent shall not be unreasonably withheld; provided, however, in no event
shall the Holder assign this Warrant to any person, entity or company that,
in the reasonable judgment of the Company, are in direct competition with
the Company, including but not limited to, persons, entities or companies
in the telecommunications industry, data communications industry or the
business of manufacturing optical fiber or preform.
(b) This Warrant may be divided or combined with other Warrants upon
presentation hereof at the aforesaid office of the Company, together with a
written notice specifying the names and denominations in which new Warrants
are to be issued, signed by the Holder or its agent or attorney. Subject to
compliance with Section 7(a), as to any transfer which may be involved in
such division or combination, the Company shall execute and deliver a new
Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice.
(c) The Company shall prepare, issue and deliver at its own expense
(other than transfer taxes) the new Warrant or Warrants under this Section
7.
(d) The Company agrees to maintain, at its aforesaid office, books for
the registration and the registration of transfer of the Warrants.
8. No Rights as Shareholder until Exercise. This Warrant does not entitle
the Holder to any voting rights or other rights as a shareholder of the Company
prior to the exercise hereof. Upon the surrender of this Warrant and the payment
of the aggregate Exercise Price, the Warrant Shares so purchased shall be and be
deemed to be issued to such Holder as the record owner of such shares as of the
close of business on the later of the date of such surrender or payment.
9. Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants
that upon receipt by the Company of evidence reasonably satisfactory to it of
the loss, theft, destruction or mutilation of this Warrant or any stock
certificate relating to the Warrant Shares, and in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to it (which shall
not include the posting of any bond), and upon surrender and cancellation of
such Warrant or stock certificate, if mutilated, the Company will make and
deliver a new Warrant or stock certificate of like tenor and dated as of such
cancellation, in lieu of such Warrant or stock certificate.
10. Saturdays, Sundays, Holidays, etc. If the last or appointed day for the
taking of any action or the expiration of any right required or granted herein
shall be a Saturday, Sunday or a legal holiday, then such action may be taken or
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such right may be exercised on the next succeeding day not a Saturday, Sunday or
legal holiday.
11. Adjustments of Exercise Price and Number of Warrant Shares.
(a) Stock Splits, etc. The number and kind of securities purchasable
upon the exercise of this Warrant and the Exercise Price shall be subject
to adjustment from time to time upon the happening of any of the following.
In case the Company shall (i) pay a dividend in shares of Common Stock or
make a distribution in shares of Common Stock to holders of its outstanding
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 of Common Stock, or (iv) issue any
shares of its capital stock in a reclassification of the Common Stock, then
the number of Warrant Shares purchasable upon exercise of this Warrant
immediately prior thereto shall be adjusted so that the Holder shall be
entitled to receive the kind and number of Warrant Shares or other
securities of the Company which it would have owned or have been entitled
to receive had such Warrant been exercised in advance thereof. Upon each
such adjustment of the kind and number of Warrant Shares or other
securities of the Company which are purchasable hereunder, the Holder shall
thereafter be entitled to purchase the number of Warrant Shares or other
securities resulting from such adjustment at an Exercise Price per Warrant
Share or other security obtained by multiplying the Exercise Price in
effect immediately prior to such adjustment by the number of Warrant Shares
purchasable pursuant hereto immediately prior to such adjustment and
dividing by the number of Warrant Shares or other securities of the Company
resulting from such adjustment. An adjustment made pursuant to this
paragraph shall become effective immediately after the effective date of
such event retroactive to the record date, if any, for such event.
(b) Anti-Dilution Provisions. During the Exercise Period, the Exercise
Price and the number of Warrant Shares issuable hereunder and for which
this Warrant is then exercisable pursuant to Section 1 hereof shall be
subject to adjustment from time to time as provided in this Section 11(b).
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 up or
down to the nearest cent.
(i) Adjustment of Exercise Price. If and whenever the Company
issues or sells, or in accordance with Section 8(b) hereof is deemed
to have issued or sold, any shares of Common Stock for a consideration
per share of less than the Set Price (as that term is defined in the
Convertible Subordinated Debenture issued in connection herewith) or
for no consideration (collectively, a "Dilutive Issuance"), then
effective immediately upon the Dilutive Issuance, the Exercise Price
will be reduced so that the Exercise Price in effect immediately
following the Dilutive Issuance will be equal to the Exercise Price
multiplied by a fraction, of which the denominator shall be the number
of shares of the Common Stock (excluding treasury shares, if any)
outstanding on the date of issuance of such Capital Share Equivalent
plus the number of Capital Share Equivalents offered for subscription
or purchase, and of which the numerator shall be the number of shares
of the Common Stock (excluding treasury shares, if any) outstanding on
the date of issuance of such Capital Share Equivalent plus the number
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of shares which the aggregate offering price of the total number of
shares so offered would purchase at the Exercise Price.
(ii) Effect on Exercise Price of Certain Events. For purposes of
determining the adjusted Exercise Price under Section 11(b) hereof,
the following will be applicable:
(A) Issuance of Rights or Options. If the Company in any
manner issues or grants any warrants, rights or options, whether
or not immediately exercisable, to subscribe for or to purchase
Common Stock or other securities exercisable, convertible into or
exchangeable for Common Stock (collectively "Convertible
Securities") (such warrants, rights and options to purchase
Common Stock or Convertible Securities are hereinafter referred
to as "Options") and the price per share for which Common Stock
is issuable upon the exercise of such Options is less than the
Set Price (the Options so priced, the "Below Set Price Options"),
then the maximum total number of shares of Common Stock issuable
upon the exercise of all such Below Set Price Options (assuming
full exercise, conversion or exchange of Convertible Securities,
if applicable) will, as of the date of the issuance or grant of
such Below Set Price Options, be deemed to be outstanding and to
have been issued and sold by the Company for such price per
share. For purposes of the preceding sentence, the "price per
share for which Common Stock is issuable upon the exercise of
such Below Set Price Options" is determined by dividing (i) the
total amount, if any, received or receivable by the Company as
consideration for the issuance or granting of all such Below Set
Price Options, plus the minimum aggregate amount of additional
consideration, if any, payable to the Company upon the exercise
of all such Below Set Price Options, plus, in the case of
Convertible Securities issuable upon the exercise of such Below
Set Price Options, the minimum aggregate amount of additional
consideration payable upon the exercise, conversion or exchange
thereof at the time such Convertible Securities first become
exercisable, convertible or exchangeable, by (ii) the maximum
total number of shares of Common Stock issuable upon the exercise
of all such Below Set Price Options (assuming full conversion of
Convertible Securities, if applicable). No further adjustment to
the Exercise Price will be made upon the actual issuance of such
Common Stock upon the exercise of such Below Set Price Options or
upon the exercise, conversion or exchange of Convertible
Securities issuable upon exercise of such Below Set Price
Options.
(B) Issuance of Convertible Securities. If the Company in
any manner issues or sells any Convertible Securities, whether or
not immediately convertible (other than where the same are
issuable upon the exercise of Options) and the price per share
for which Common Stock is issuable upon such exercise, conversion
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or exchange is less than the Set Price, then the maximum total
number of shares of Common Stock issuable upon the exercise,
conversion or exchange of all such Convertible Securities will,
as of the date of the issuance of such Convertible Securities, be
deemed to be outstanding and to have been issued and sold by the
Company for such price per share. For the purposes of the
preceding sentence, the "price per share for which Common Stock
is issuable upon such exercise, conversion or exchange" is
determined by dividing (i) the total amount, if any, received or
receivable by the Company as consideration for the issuance or
sale of all such Convertible Securities, plus the minimum
aggregate amount of additional consideration, if any, payable to
the Company upon the exercise, conversion or exchange thereof at
the time such Convertible Securities first become exercisable,
convertible or exchangeable, by (ii) the maximum total number of
shares of Common Stock issuable upon the exercise, conversion or
exchange of all such Convertible Securities. No further
adjustment to the Exercise Price will be made upon the actual
issuance of such Common Stock upon exercise, conversion or
exchange of such Convertible Securities.
(C) Change in Option Price or Conversion Rate. If there is a
change at any time in (i) the amount of additional consideration
payable to the Company upon the exercise of any Options; (ii) the
amount of additional consideration, if any, payable to the
Company upon the exercise, conversion or exchange of any
Convertible Securities; or (iii) the rate at which any
Convertible Securities are convertible into or exchangeable for
Common Stock (in each such case, other than under or by reason of
provisions designed to protect against dilution), the Exercise
Price in effect at the time of such change will be readjusted to
the Exercise Price which would have been in effect at such time
had such Options or Convertible Securities still outstanding
provided for such changed additional consideration or changed
conversion rate, as the case may be, at the time initially
granted, issued or sold.
(D) Treatment of Expired Options and Unexercised Convertible
Securities. If, in any case, the total number of shares of Common
Stock issuable upon exercise of any Option or upon exercise,
conversion or exchange of any Convertible Securities is not, in
fact, issued and the rights to exercise such Option or to
exercise, convert or exchange such Convertible Securities shall
have expired or terminated, the Exercise Price then in effect
will be readjusted to the Exercise Price which would have been in
effect at the time of such expiration or termination had such
Option or Convertible Securities, to the extent outstanding
immediately prior to such expiration or termination (other than
in respect of the actual number of shares of Common Stock issued
upon exercise or conversion thereof), never been issued.
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(E) Calculation of Consideration Received. If any Common
Stock, Options or Convertible Securities are issued, granted or
sold for cash, the consideration received therefor for purposes
of this Warrant will be the amount received by the Company
therefor, before deduction of reasonable commissions,
underwriting discounts or allowances or other reasonable expenses
paid or incurred by the Company in connection with such issuance,
grant or sale. In case any Common Stock, Options or Convertible
Securities are issued or sold for a consideration part or all of
which shall be other than cash, the amount of the consideration
other than cash received by the Company will be the fair market
value of such consideration, except where such consideration
consists of securities, in which case the amount of consideration
received by the Company will be the Market Price thereof as of
the date of receipt. In case any Common Stock, Options or
Convertible Securities are issued in connection with any merger
or consolidation in which the Company is the surviving
corporation, the amount of consideration therefor will be deemed
to be the fair market value of such portion of the net assets and
business of the non-surviving corporation as is attributable to
such Common Stock, Options or Convertible Securities, as the case
may be. The fair market value of any consideration other than
cash or securities will be determined in good faith by an
investment banker or other appropriate expert of national
reputation selected by the Company and reasonably acceptable to
the holder hereof, with the costs of such appraisal to be borne
by the Company.
(F) Exceptions to Adjustment of Exercise Price. No
adjustment to the Exercise Price will be made (i) upon the
exercise of this Warrant or any other warrant of this series or
of any other series issued by the Company, or upon the issuance,
conversion, or redemption of, or payment of interest under, any
Convertible Securities issued pursuant to the Purchase Agreement;
(ii) upon the exercise or conversion of any Convertible
Securities, options or warrants issued and outstanding on the
initial issuance date of this Warrant; (iii) upon the issuance of
Common Stock or issuance, grant exercise or conversion of any
Convertible Securities which may hereafter be issued, granted,
exercised or converted (x) as compensation to employees,
consultants, brokers, investment bankers or members of the
Company's Board of Directors, or (y) under any employee benefit
plan of the Company now existing or to be implemented in the
future, so long as the issuance of such Common Stock or
Convertible Securities is approved by a majority of the
non-employee members of the Board of Directors of the Company or
a majority of the members of a committee of non-employee
directors established for such purpose; (iv) upon the issuance of
Common Stock or Convertible Securities in a public offering,
whether or not underwritten and upon the exercise or conversion
of such Convertible Securities; (v) upon the issuance of Common
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Stock or Convertible Securities in any transaction of the nature
contemplated by Rule 145, promulgated under the Securities Act;
or (vi) in connection with any strategic partnership or joint
venture or acquisition (the primary purpose of which is not to
raise equity capital for the Company) or (vii) the issuance of
Common Stock or the issuance, grant, exercise or conversion of
Convertible Securities issued to a bank or equipment lessor
(pursuant to transactions the primary purpose of which is not to
raise equity capital for the Company.
(iii) Notice of Adjustment. Upon the occurrence of any event
which requires any adjustment of the Exercise Price, then, and in each
such case, the Company shall give notice thereof to the holder of this
Warrant, which notice shall state the Exercise Price resulting from
such adjustment and the increase or decrease in the number of Warrant
Shares purchasable at such price upon exercise, setting forth in
reasonable detail the method of calculation and the facts upon which
such calculation is based, provided that such notice shall not contain
any material nonpublic information. Such calculation shall be
certified by the chief financial officer of the Company.
(iv) Minimum Adjustment of Exercise Price. No adjustment of the
Exercise Price shall be made in an amount of less than 1% of the
Exercise Price in effect at the time such adjustment is otherwise
required to be made, but any such lesser adjustment shall be carried
forward and shall be made at the time and together with the next
subsequent adjustment which, together with any adjustments so carried
forward, shall amount to not less than 1% of such Exercise Price.
(v) Certain Events. If, at any time during the Exercise Period,
any event occurs of the type contemplated by the adjustment provisions
of this Section 11 but not expressly provided for by such provisions,
the Company will give notice of such event as provided in Section 11
hereof, and the Company's Board of Directors will make an appropriate
adjustment in the Exercise Price and the number of shares of Common
Stock acquirable upon exercise of this Warrant so that the rights of
the holder shall be neither enhanced nor diminished by such event.
(vi) Certain Definitions. "Common Stock Deemed Outstanding" shall
mean the number of shares of Common Stock actually outstanding (not
including shares of Common Stock held in the treasury of the Company),
plus (x) in the case of any adjustment hereunder resulting from the
issuance of any Options, the maximum total number of shares of Common
Stock issuable upon the exercise of the Options for which the
adjustment is required (including any Common Stock issuable upon the
conversion of Convertible Securities issuable upon the exercise of
such Options), and (y) in the case of any adjustment required
hereunder resulting from the issuance of any Convertible Securities,
the maximum total number of shares of Common Stock issuable upon the
exercise, conversion or exchange of the Convertible Securities for
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which the adjustment is required, as of the date of issuance of such
Convertible Securities, if any.
12. Reorganization, Reclassification, Merger, Consolidation or Disposition
of Assets. In case the Company shall reorganize its capital, reclassify its
capital stock, consolidate or merge with or into another corporation (where the
Company is not the surviving corporation or where there is a change in or
distribution with respect to the Common Stock of the Company), or sell, transfer
or otherwise dispose of all or substantially all its property, assets or
business to another corporation and, pursuant to the terms of such
reorganization, reclassification, merger, consolidation or disposition of
assets, shares of common stock of the successor or acquiring corporation, or any
cash, shares of stock or other securities or property of any nature whatsoever
(including warrants or other subscription or purchase rights) in addition to or
in lieu of common stock of the successor or acquiring corporation ("Other
Property"), are to be received by or distributed to the holders of Common Stock
of the Company, then the Holder shall have the right thereafter to receive, at
their option, (a) upon exercise of this Warrant, the number of shares of Common
Stock of the successor or acquiring corporation or of the Company, if it is the
surviving corporation, and Other Property receivable upon or as a result of such
reorganization, reclassification, merger, consolidation or disposition of assets
by a Holder of the number of shares of Common Stock for which this Warrant is
exercisable immediately prior to such event, or (b) cash equal to the value of
this Warrant as determined in accordance with the Black-Sholes option pricing
formula. In case of any such reorganization, reclassification, merger,
consolidation or disposition of assets, the successor or acquiring corporation
(if other than the Company) shall expressly assume the due and punctual
observance and performance of each and every covenant and condition of this
Warrant to be performed and observed by the Company and all the obligations and
liabilities hereunder, subject to such modifications as may be deemed
appropriate (as determined in good faith by resolution of the Board of Directors
of the Company) in order to provide for adjustments of Warrant Shares for which
this Warrant is exercisable which shall be as nearly equivalent as practicable
to the adjustments provided for in this Section 12. For purposes of this Section
12, "common stock of the successor or acquiring corporation" shall include stock
of such corporation of any class which is not preferred as to dividends or
assets over any other class of stock of such corporation and which is not
subject to redemption and shall also include any evidences of indebtedness,
shares of stock or other securities which are convertible into or exchangeable
for any such stock, either immediately or upon the arrival of a specified date
or the happening of a specified event and any warrants or other rights to
subscribe for or purchase any such stock. The foregoing provisions of this
Section 12 shall similarly apply to successive reorganizations,
reclassifications, mergers, consolidations or disposition of assets.
13. Voluntary Adjustment by the Company. The Company may at any time during
the term of this Warrant reduce the then current Exercise Price to any amount
and for any period of time deemed appropriate by the Board of Directors of the
Company.
14. Notice of Adjustment. Whenever the number of Warrant Shares or number
or kind of securities or other property purchasable upon the exercise of this
Warrant or the Exercise Price is adjusted, as herein provided, the Company shall
promptly mail by registered or certified mail, return receipt requested, to the
Holder notice of such adjustment or adjustments setting forth the number of
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Warrant Shares (and other securities or property) purchasable upon the exercise
of this Warrant and the Exercise Price of such Warrant Shares (and other
securities or property) after such adjustment, setting forth a brief statement
of the facts requiring such adjustment and setting forth the computation by
which such adjustment was made. Such notice, in the absence of manifest error,
shall be conclusive evidence of the correctness of such adjustment.
15. Notice of Corporate Action. If at any time:
(a) the Company shall take a record of the holders of its Common Stock
for the purpose of entitling them to receive a dividend or other
distribution, or any right to subscribe for or purchase any evidences of
its indebtedness, any shares of stock of any class or any other securities
or property, or to receive any other right, or
(b) there shall be any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company or
any consolidation or merger of the Company with, or any sale, transfer or
other disposition of all or substantially all the property, assets or
business of the Company to, another corporation or,
(c) there shall be a voluntary or involuntary dissolution, liquidation
or winding up of the Company,
then, in any one or more of such cases, the Company shall give to Holder (i) at
least 20 days' prior written notice of the date on which a record date shall be
selected for such dividend, distribution or right or for determining rights to
vote in respect of any such reorganization, reclassification, merger,
consolidation, sale, transfer, disposition, liquidation or winding up, and (ii)
in the case of any such reorganization, reclassification, merger, consolidation,
sale, transfer, disposition, dissolution, liquidation or winding up, at least 20
days' prior written notice of the date when the same shall take place. Such
notice in accordance with the foregoing clause also shall specify (i) the date
on which any such record is to be taken for the purpose of such dividend,
distribution or right, the date on which the holders of Common Stock shall be
entitled to any such dividend, distribution or right, and the amount and
character thereof, and (ii) the date on which any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
dissolution, liquidation or winding up is to take place and the time, if any
such time is to be fixed, as of which the holders of Common Stock shall be
entitled to exchange their Warrant Shares for securities or other property
deliverable upon such disposition, dissolution, liquidation or winding up. Each
such written notice shall be sufficiently given if addressed to Holder at the
last address of Holder appearing on the books of the Company and delivered in
accordance with Section 17(d).
16. Authorized Shares. The Company covenants that during the period the
Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of the Warrant
Shares upon the exercise of any purchase rights under this Warrant. The Company
further covenants that its issuance of this Warrant shall constitute full
authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for the Warrant
Shares upon the exercise of the purchase rights under this Warrant. The Company
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will take all such reasonable action as may be necessary to assure that such
Warrant Shares may be issued as provided herein without violation of any
applicable law or regulation, or of any requirements of the Principal Market
upon which the Common Stock may be listed.
The Company shall not by any action, including, without limitation,
amending its certificate of incorporation 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 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 Holder
against impairment. Without limiting the generality of the foregoing, the
Company will (a) not increase the par value of any Warrant Shares above the
amount payable therefor upon such exercise immediately prior to such increase in
par value, (b) take all such action as may be necessary or appropriate in order
that the Company may validly and legally issue fully paid and nonassessable
Warrant Shares upon the exercise of this Warrant, and (c) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents
from any public regulatory body having jurisdiction thereof as may be necessary
to enable the Company to perform its obligations under this Warrant.
Before taking any action which would result in an adjustment in the number
of Warrant Shares for which this Warrant is exercisable or in the Exercise
Price, the Company shall obtain all such authorizations or exemptions thereof,
or consents thereto, as may be necessary from any public regulatory body or
bodies having jurisdiction thereof.
17. Miscellaneous.
(a) Jurisdiction. This Warrant shall constitute a contract under the
laws of New York, without regard to its conflict of law, principles or
rules.
(b) Restrictions. The Holder acknowledges that the Warrant Shares
acquired upon the exercise of this Warrant, if not registered, will have
restrictions upon resale imposed by state and federal securities laws.
(c) Nonwaiver and Expenses. No course of dealing or any delay or
failure to exercise any right hereunder on the part of Holder shall operate
as a waiver of such right or otherwise prejudice Holder's rights, powers or
remedies, notwithstanding all rights hereunder terminate on the Termination
Date. If the Company willfully and knowingly fails to comply with any
provision of this Warrant, which results in any material damages to the
Holder, the Company shall pay to Holder such amounts as shall be sufficient
to cover any costs and expenses including, but not limited to, reasonable
attorneys' fees, including those of appellate proceedings, incurred by
Holder in collecting any amounts due pursuant hereto or in otherwise
enforcing any of its rights, powers or remedies hereunder.
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(d) Notices. Any notice, request or other document required or
permitted to be given or delivered to the Holder by the Company shall be
delivered in accordance with the notice provisions of the Purchase
Agreement.
(e) Limitation of Liability. No provision hereof, in the absence of
affirmative action by Holder to purchase Warrant Shares, and no enumeration
herein of the rights or privileges of Holder, shall give rise to any
liability of Holder for the purchase price of any Common Stock or as a
stockholder of the Company, whether such liability is asserted by the
Company or by creditors of the Company.
(f) Remedies. Holder, in addition to being entitled to exercise all
rights granted by law, including recovery of damages, will be entitled to
specific performance of its rights under this Warrant. The Company agrees
that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this Warrant and
hereby agrees to waive the defense in any action for specific performance
that a remedy at law would be adequate.
(g) Successors and Assigns. Subject to applicable securities laws,
this Warrant and the rights and obligations evidenced hereby shall inure to
the benefit of and be binding upon the successors of the Company and the
successors and permitted assigns of Holder. The provisions of this Warrant
are intended to be for the benefit of all Holders from time to time of this
Warrant and shall be enforceable by any such Holder or holder of Warrant
Shares.
(h) Amendment. This Warrant may be modified or amended or the
provisions hereof waived with the written consent of the Company and the
Holder.
(i) Severability. Wherever possible, each provision of this Warrant
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Warrant shall be prohibited by
or invalid under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the
remainder of such provisions or the remaining provisions of this Warrant.
(j) Headings. The headings used in this Warrant are for the
convenience of reference only and shall not, for any purpose, be deemed a
part of this Warrant.
********************
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by
its officer thereunto duly authorized.
Dated: ________, 2002
FIBERCORE, INC.
By:______________________________________
Robert P. Lobban, CFO
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NOTICE OF EXERCISE
To: Fibercore, Inc.
(1) The undersigned hereby elects to purchase ________ Warrant Shares (the
"Common Stock"), of Fibercore, Inc. pursuant to the terms of the attached
Warrant, and tenders herewith payment of the exercise price in full, together
with all applicable transfer taxes, if any.
(2) Please issue a certificate or certificates representing said Warrant
Shares in the name of the undersigned or in such other name as is specified
below:
---------------------------
The Warrant Shares shall be delivered to the following:
NAME: TAX IDENTIFICATION NUMBER (if applicable)
- ------------------------------- ---------------------------
- ------------------------------- ---------------------------
- ------------------------------- ---------------------------
[PURCHASER]
By:______________________________
Name:
Title:
Dated:___________________________
ASSIGNMENT FORM
(To assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to exercise the warrant.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby
are hereby assigned to
_______________________________________________ whose address is
_______________________________________________________________.
_______________________________________________________________
Dated: ______________, _______
Holder's Signature: _____________________________
Holder's Address: _____________________________
_____________________________
Signature Guaranteed: ___________________________________________
NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatsoever, and must be guaranteed by a bank or trust company. Officers
of corporations and those acting in an fiduciary or other representative
capacity should file proper evidence of authority to assign the foregoing
Warrant.