EXHIBIT 99.2
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 OR APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, ASSIGNED
OR OTHERWISE DISPOSED OF, AND NO TRANSFER OF THE SECURITIES WILL BE MADE BY THE
COMPANY OR ITS TRANSFER AGENT, IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION
OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
NICOLLETT PROCESS ENGINEERING, INC..
COMMON STOCK PURCHASE WARRANT
Date of Issuance: July 29th, 1999 Certificate No. CW-1
FOR VALUE RECEIVED, Nicollet Processing Engineering, Inc., a Minnosota
corporation (the "Company"), hereby grants to TECHinspirations Inc. (Cayman)
(the "Investor") or its registered assigns (the "Registered Holder") the right
to purchase from the Company 4,750,000 shares of Warrant Stock at a price of
$0.15 per share (as adjusted from time to time as provided herein, the "Exercise
Price"), subject to adjustments set forth herein The amount and kind of
securities receivable pursuant to the rights granted hereunder are subject to
adjustment pursuant to the provisions contained in this Warrant.
The Company acknowledges that of the purchase price paid for the
Warrants pursuant to a certain purchase agreement made with effect as of the
29th day of July 1999 between the Company and the Investor (the "Agreement"),
being the amount of one hundred dollars ($100.00) in the aggregate, has been
paid by the Investor hereof as a nonrefundable payment for the Warrant Stock
from time to time issued hereunder. Certain terms used in this Common Stock
purchase warrant (the "Warrant") are defined in section 7 hereof. Each
capitalized term used in this Warrant but not otherwise defined herein has the
meaning set forth for such term in the Agreement.
This Warrant is subject to the following provisions:
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SECTION 1
EXERCISE OF WARRANT
1.1 EXERCISE PERIOD
The Registered Holder may exercise, in whole or in part, the purchase
rights represented by this Warrant at any time and from time to time during the
periods (the "Exercise Periods") set out in the paragraphs below in respect of
that number of shares of Warrant Stock set out in such paragraph:
(a) With respect to the warrants for 1,500,000 shares of the
Warrant Stock, the same may be exercised in whole or in part
at any time after the Date of Issuance to and including the
fifth anniversary of the Date of Issuance (the "End Date").
(b) With respect to the warrants for 1,000,000 shares of the
Warrant Stock, the same may only be exercised after the
Company's Common Stock Closing Price has reached or exceeded
$1.00 per share for ten consecutive trading days and
thereafter does not trade below $1.00 per share prior to the
exercise of the warrant entitlement in this paragraph; and
further provided that the unexercised rights in this paragraph
shall be suspended if the Company's Common Stock Closing Price
falls below $1.00 (in which event, the rights hereunder may be
reactivated and thereafter suspended from time to time up to
the End Date, in accordance with the foregoing provisions of
this paragraph);
(c) With respect to the warrants for 1,000,000 shares of the
Warrant Stock, the same may only be exercised after the
Company's Common Stock Closing Price has reached or exceeded
$2.00 per share for ten consecutive trading days and
thereafter does not trade below $2.00 per share prior to the
exercise of the warrant entitlement in this paragraph; and
further provided that the unexercised rights in this paragraph
shall be suspended if the Company's Common Stock Closing Price
falls below $2.00 (in which event, the rights hereunder may be
reactivated and thereafter suspended from time to time up to
the End Date, in accordance with the foregoing provisions of
this paragraph); and
(d) With respect to the warrants for 1,250,000 shares of the
Warrant Stock, the same may only be exercised after the
Company's Common Stock Closing Price has reached or exceeded
$3.00 per share for ten consecutive trading days and
thereafter does not trade below $3.00 per share prior to the
exercise of the warrant entitlement in this paragraph; and
further provided that the unexercised rights in this paragraph
shall be suspended if the Company's Common Stock Closing Price
falls below $3.00 (in which event, the rights hereunder may be
reactivated and thereafter suspended from time to time to the
End Date, in accordance with the foregoing provisions of this
paragraph).
In the event that this Warrant has not been exercised in full as of the
End Date, the Registered Holder's right to exercise this Warrant in
respect of any remaining unexercised Warrant Stock shall expire and be
of no further force and effect.
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1.2 EXERCISE PROCEDURE
(a) This Warrant shall be deemed to have been exercised when the
Company has received all of the following items (the "Exercise
Time") in respect of that number of shares of Warrant Stock
specified in the Exercise Agreement and authorized for
purchase pursuant to Section 1.1 above::
(i) a completed Exercise Agreement, as described in
Section 1.3 below, executed by the Person exercising
all or part of the rights represented by this Warrant
(the "Purchaser");
(ii) this Warrant;
(iii) if this Warrant is not registered in the name of the
Purchaser, an Assignment or Assignments in the form
set forth in Exhibit II hereto evidencing the
assignment of this Warrant to the Purchaser, in which
case the Registered Holder shall have complied with
the provisions set forth in Section 9 hereof; and,
(iv) either
(A) a check payable to the Company in an amount
equal to the product of the Exercise Price
multiplied by the number of shares of
Warrant Stock being purchased upon such
exercise (the "Aggregate Exercise Price"),
(B) the surrender to the Company of debt or
equity securities of the Company having a
Market Price equal to the Aggregate Exercise
Price of the Warrant Stock being purchased
upon such exercise (provided that for
purposes of this subparagraph, the Market
Price of any note or other debt security or
any preferred stock shall be deemed to be
equal to the aggregate outstanding principal
amount or liquidation value thereof plus all
accrued and unpaid interest thereon or
accrued or declared and unpaid dividends
thereon) or
(C) a written notice to the Company that the
Purchaser is exercising the Warrant (or a
portion thereof) by authorizing the Company
to withhold from issuance a number of shares
of Warrant Stock issuable upon such exercise
of the Warrant which when multiplied by the
Market Price of the Warrant Stock is equal
to the Aggregate Exercise Price (and such
withheld shares shall no longer be issuable
under this Warrant).
(a) Certificates for shares of Warrant Stock purchased upon
exercise of this Warrant shall be delivered by the Company to
the Purchaser (or the Person specified in the applicable
Exercise Agreement, as provided in Section 1.3 below) within
five
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business days after the date of the Exercise Time. Unless
this Warrant has expired or all of the purchase rights
represented hereby have been exercised, the Company shall
prepare a new Warrant, substantially identical hereto,
representing the rights formerly represented by this Warrant
which have not expired or been exercised and shall, within
such five-day period, deliver such new Warrant to the Person
designated for delivery in the Exercise Agreement.
Notwithstanding that this Warrant may have expired or that all
of the purchase rights represented hereby may have been
exercised, the rights of the Registered Holder hereof
otherwise represented by this Warrant shall survive such
expiration or exercise.
(e) The Warrant Stock issuable upon the exercise of this Warrant
shall be deemed to have been issued to the Purchaser at the
Exercise Time, and the Purchaser shall be deemed for all
purposes to have become the record holder of such Warrant
Stock at the Exercise Time.
(f) The issuance of certificates for shares of Warrant Stock upon
exercise of this Warrant shall be made without charge to the
Registered Holder or the Purchaser for any issuance tax in
respect thereof or other cost incurred by the Company in
connection with such exercise and the related issuance of
shares of Warrant Stock. Each share of Warrant Stock issuable
upon exercise of this Warrant shall, upon payment of the
Exercise Price therefor, be fully paid and nonassessable and
free from all liens and charges with respect to the issuance
thereof.
(g) The Company shall not close its books against the transfer of
this Warrant or of any share of Warrant Stock issued or
issuable upon the exercise of this Warrant in any manner which
interferes with the timely exercise of this Warrant. The
Company shall from time to time take all such action as may be
necessary to assure that the par value per share of the
unissued Warrant Stock acquirable upon exercise of this
Warrant is at all times equal to or less than the sum of the
Exercise Price then in effect plus the portion of the purchase
price of the Warrant allocated (as described in the preface
above) as payment for one share of the Warrant Stock issuable
hereunder.
(h) The Company shall assist and co-operate with any Registered
Holder or Purchaser required to make any governmental filings
or obtain any governmental approvals prior to or in connection
with any exercise of this Warrant (including, without
limitation, making any filings required to be made by the
Company).
(i) Notwithstanding any other provision hereof, if an exercise of
any portion of this Warrant is to be made in connection with a
public offering of the Company's Stock, the exercise of any
portion of this Warrant may, at the election of the holder
hereof, be conditioned upon the consummation of the public
offering in which case such exercise shall not be deemed to be
effective until the consummation of such public offering.
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(j) The Company shall at all times reserve and keep available out
of its authorized but unissued shares of Warrant Stock, solely
for the purpose of issuance upon the exercise of the Warrants,
such number of shares of Warrant Stock as are issuable upon
the exercise of all outstanding Warrants. All shares of
Warrant Stock which are so issuable shall, when issued, be
duly and validly issued, fully paid and nonassessable and free
from all taxes, liens and charges. The Company shall take all
such actions as may be necessary to assure that all such
shares of Warrant Stock may be so issued without violation of
any applicable law or governmental regulation or any
requirements of any domestic securities exchange upon which
shares of Warrant Stock or Common may be listed (except for
official notice of issuance which shall be immediately
delivered by the Company upon each such issuance).
1.3 EXERCISE AGREEMENT
With respect to any exercise of this Warrant, the Exercise Agreement shall be
substantially in the form set forth in Exhibit I hereto, except that if the
shares of Warrant Stock are not to be issued in the name of the Person in whose
name this Warrant is registered, the Exercise Agreement shall also state the
name of the Person to whom the certificates for the shares of Warrant Stock are
to be issued, and if the number of shares of Warrant Stock to be issued does not
include all the shares of Warrant Stock purchasable hereunder, it shall also
state the name of the Person to whom a new Warrant for the unexercised portion
of the rights hereunder is to be delivered. Such Exercise Agreement shall be
dated the actual date of execution thereof.
SECTION 2
ADJUSTMENT OF NUMBER OF SHARES
2.1 APPLICATION AND EXERCISE PRICE
In order to prevent dilution of the rights granted under this Warrant, the
number of shares of Warrant Stock obtainable upon exercise of this Warrant shall
be subject to adjustment from time to time as provided in this Section 2. Upon
each adjustment of the number of shares of Warrant Stock obtainable upon
exercise of this Warrant, the Warrant Exercise Price shall be adjusted by
multiplying the Warrant Exercise Price in effect immediately prior to such
adjustment by a fraction, the numerator of which is the number of shares of
Warrant Stock obtainable upon exercise immediately prior to such adjustment and
the denominator of which is the number of shares of Warrant Stock obtainable
upon exercise immediately after such adjustment.
2.2 SUBDIVISION OR COMBINATION OR COMMON STOCK
If the Company at any time subdivides (by any stock split, stock dividend,
recapitalization or otherwise) one or more classes of its outstanding shares of
Common Stock into a greater number of shares, the number of shares of Warrant
Stock obtainable upon exercise of this Warrant shall be proportionately
increased. If the Company at any time combines (by reverse stick split or
otherwise) one or more classes of its outstanding shares of Common Stock into
smaller number of shares, the number of shares of Warrant Stock obtainable upon
exercise of this Warrant shall be proportionately decreased.
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2.3 REORGANIZATION, RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE
Any recapitalization, reorganization, reclassification, consolidation, merger,
sale of all or substantially all of the Company's assets to another Person or
other transaction which is effected in such a way that holders of Common Stock
are entitled to receive (either directly or upon subsequent liquidation) stock,
securities or assets with respect to or in exchange for Common Stock is referred
to herein as an "Organic Change". Prior to the consummation of any Organic
Change, the Company shall make appropriate provision (in form and substance
satisfactory to the Registered Holder) with respect to such holders' rights and
interests to insure that the provisions of this Section 2 and Sections 3 and 4
hereof shall thereafter be applicable to the Warrants (including, in the case of
any such consolidation, merger or sale in which the successor entity or
purchasing entity is other than the Company and in which the value of the Common
Stock reflected by the terms of such consolidation, merger or sale multiplied by
the ratio of the Market Price in effect immediately prior to such consolidation,
merger or sale divided by such value of the Common Stock). The Company shall not
effect any such consolidation, merger or sale, unless prior to the consummation
thereof, the successor entity (if other than the Company) resulting from
consolidation or merger or the entity purchasing such assets assumes by written
instrument (in the form and substance satisfactory to the Registered Holder) the
obligation to deliver to each such holder such shares of stock, securities or
assets as, in accordance with the foregoing provisions, such holder may be
entitled to acquire.
2.4 NOTICES
(v) Immediately upon any adjustment of the number of shares of
Warrant Stock acquirable upon exercise of this Warrant, the
company shall give written notice thereof to the Registered
Holder, setting forth in reasonable detail and certifying the
calculation of such adjustment.
(vi) The Company shall give written notice to each holder of
Underlying Warrant Stock at least 20 days prior to the date on
which the Company closes its books or takes a record (A) with
respect to any dividend or distribution upon the Common Stock,
(B) with respect to any pro rata subscription offer to holders
of Common Stock; or (C) for determining rights to vote with
respect to any Organic Change, dissolution or liquidation.
2.5 NO AVOIDANCE
In the event that the Company shall enter into any transaction for the purpose
of avoiding the application of the provisions of this Section 2, the benefits
provided by such provisions shall nevertheless apply and be preserved.
SECTION 3
LIQUIDATING AND OTHER DIVIDENDS
3.1 PAYMENT OF LIQUIDATING DIVIDENDS
Subject to Section 4, if the Company declares or pays a dividend upon the Common
Stock payable otherwise than in cash out of earnings or earned surplus
(determined in accordance with
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GAAP), including a stock dividend payable in shares of Common Stock (a
"Liquidating Dividend"), then the Company shall pay to the Registered Holder
of this Warrant at the time of payment thereof the Liquidating Dividend which
would have been paid to such Registered Holder on the Warrant Stock had this
Warrant been fully exercised in respect of that number of shares of
Underlying Warrant Stock that the Registered Holder is otherwise entitled at
that time to exercise this Warrant pursuant to Section 1.1 hereof (the
"Applicable Shares") immediately prior to the time as of which a record is
taken for such Liquidation Dividend, or, if no record is taken, the time as
of which the record holders of Common Stock entitled to such dividends are to
be determined.
3.2 ADJUSTMENT OF NUMBER OF SHARES IN CONNECTION WITH OTHER DIVIDENDS
Subject to Section 4, if the Company declares or pays a dividend upon the Common
Stock in cash out of earnings or earned surplus (determined in accordance with
GAAP), then:
(a) such Dividend shall be allocated proportionately to the
holders of outstanding Common Stock and holders of all
Warrants as though all Warrants (and, to the extent required
by the terms thereof, any other warrants, options or other
rights to acquire shares of Common Stock) for Applicable
Shares immediately prior to the date on which a record was
taken for such Dividend, or, if no record was taken, the date
as of which the record holders of Common Stock entitled to
such dividends were determined;
(b) the amount allocable to the holders of Warrants shall be
deposited by the Company in a separate interest-bearing
account concurrently with the payment of such Dividend to the
holders of Common Stock; and
(c) the amount allocated to the Warrants, plus all accrued
interest thereon, shall be paid to each holder thereof
promptly after the exercise of the Warrants by such holder in
the amount allocable to the Common Stock obtained by such
holder upon exercise.
SECTION 4
QUALIFICATION FOR SECTION 3 DIVIDENDS
4.1 PROVISO
The Registered Holder shall only be entitled to receive the Liquidating
Dividends or other dividends payable to the Registered Holder on Applicable
Shares pursuant to Section 3 if, within 30 days of receipt of notice of the
decision to declare such dividends, the Registered Holder exercises this Warrant
in respect of such Applicable Shares and pays to the Company the Purchase Price
therefor.
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SECTION 5
PURCHASE RIGHTS
5.1 ENTITLEMENT
If at any time the Company grants, issue or sells any Options, Convertible
Securities or rights to purchase stock, warrants, securities or other property
pro rata to the record holders of Common Stock (the "PURCHASE RIGHTS"), then the
Registered holder of this Warrant shall be entitled to obtain, upon the same
terms on which holders of Common Stock are to receive such Purchase Rights, the
aggregate purchase Rights which such holder could have acquired if such holder
had held the number of shares of Warrant Stock acquirable upon complete exercise
of this Warrant immediately before the time as of which a record is taken for
the grant, issuance or sale of such Purchase Rights, or, if no such record is
taken, the time as of which the record holders of Common Stock are to be
determined for the grant, issue or sale of such Purchase Rights.
SECTION 6
CERTIFICATES, NOTICES AND CONSENTS
6.1 CERTIFICATES
Upon the occurrence of any event requiring adjustments to the number of shares
subject to this Warrant pursuant to Section 2, the Company shall mail to each
holder of Underlying Warrant Stock (by registered or certified mail, postage
prepaid) a certificate signed by the authorized signing officers of the Company,
setting forth in reasonable detail the events requiring the adjustment and the
method by which such proposed adjustment was calculated, specifying the adjusted
number of shares subject to this Warrant after giving effect to the proposed
adjustment.
6.2 NOTICE
If the Company after the date hereof shall propose to:
(a) Pay any dividend payable in stock to the holders of Common
Stock or to make any other distribution to the holders of
Common Stock or any extraordinary dividend or Liquidating
Dividend directly or indirectly attributable to proceeds from
the sale or other disposition of a significant business or
asset of the Company;
(b) Offer to the holders of Common Stock rights to subscribe for
or purchase any additional shares of any class of stock or any
other rights or options;
(c) Effect any reclassification except the subdivision or
combination of shares of outstanding Common Stock; or
(d) Effect any Organic Change or sale transaction described in
Section 2.4 or the liquidation, dissolution or winding up of
the Company;
then, in each such case, the Company shall mail (by registered or certified
mail, postage prepaid) to the holders of Underlying Warrant Stock notice of such
proposed action, which shall specify
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the date on which the books of the Company shall close, or a record date
shall be established, for determining holders of Common Stock entitled to
receive such stock dividends or other distribution of such rights or options,
or the date on which other distribution of such rights or options, or the
date on which such reclassification, reorganization, consolidation, merger,
sale, transfer, other disposition, liquidation, dissolution or winding up
shall take place or commence, as the case may be, and the date as of which it
is expected that holders of Common Stock of record shall be entitled to
receive securities or other property deliverable upon such action, if any
such date is to be fixed. Such notice shall be mailed, in the case of any
action covered by clauses (a), (b) or (c) above, at least 10 days prior to
the record date for determining holders of Common Stock for purposes of
receiving such payment or offer and, in the case of any action covered by
clause (c) above, at least 10 days prior to the date upon which such action
takes place, and, in the case of any action covered by clause (d) above, at
least 30 days prior to the date upon which such action takes place, at least
20 days prior to the date on which the Company closes its books or takes a
record for determining rights to vote with respect to any event covered by
clause (d) and 30 days prior to any record date to determine holders of
Common Stock entitled to receive such securities or other property.
6.3 FAILURE AND DEFECTS
Failure to file any certificate or notice or to mail any notice, or any defect
in any certificate or notice, pursuant to this Section 6 shall not affect the
legality or validity of the adjustment of the Exercise Price and/or number of
shares of Warrant Stock subject to this Warrant pursuant to Section 2 hereof.
SECTION 7
DEFINITIONS
The following terms have the meanings set forth below:
"COMMON" means the Common Stock, par value $0.01 per share, of the Company.
"CLOSING PRICE"of any security of the Company with reference to any particular
date means, the closing price on that day on the principal securities exchange
on which such security may at that time be listed or quoted (determined by
virtue of general trading volume), including for this purpose, the NASDAQ stock
market, or, if there have been no such sales on such exchange on that day, the
average of the highest bid and lowest asked price on that exchange during that
day, or, if on that day such security is not so listed or quoted, the average of
the highest bid and lowest asked price on such date in the domestic
over-the-counter market as reported by the National Quotation Bureau, Inc., or
any similar successor organization; provided that if the particular date is not
a business date on which such securities may be traded, the particular date
shall be deemed to be the first immediately preceding date on which such
securities may generally be traded. If it any time such security is not listed
on any domestic exchange or quoted on the NASDAQ stock market or the domestic
over-the-counter market, the "Closing Price" shall be, for that day, the fair
value of the security on that day determined jointly by the Company and
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the Warrant Holder (with disputes to be resolved in the manner herein
provided for the resolution of disputes on the determination of Market Price
under similar circumstances).
"COMMON STOCK" means, collectively, Common and any capital stock of any class of
the Company hereafter authorized which is not limited to a fixed sum or
percentage of par or stated value in respect to the rights of the holders
thereof to participate in dividends or in the distribution of assets upon any
liquidation, dissolution or winding up of the Company.
"CONVERTIBLE SECURITIES" means any stock or securities directly or indirectly
convertible into or exchangeable for Common Stock including the Common Stock to
which this Warrant relates.
"DATE OF ISSUANCE" means the date of initial issuance of the Warrants pursuant
to the Agreement (as of immediately after such issuance) regardless of the
number of times new certificates representing the unexpired and unexercised
rights formerly represented by this Warrant shall be issued.
"GAAP" means those accounting principles which are recognized as being generally
accepted in the United States of America from time to time, consistently
applied.
"MARKET PRICE" means as to any security (other than the Warrants) the average of
the closing prices of such security's sales on all domestic securities exchanges
on which such security may at the time be listed or quoted, including for this
purpose, The NASDAQ Stock Market, or, if there have been no sales on any such
exchange on any day, the average of the highest bid and lowest asked prices on
all such exchanges at the end of such day, or, if on any day such security is
not so listed or quoted, the average on the highest bid and lowest asked prices
on such day in the domestic over-the-counter market as reported by the National
Quotation Bureau, Incorporated, or any similar successor organization, in each
such case averaged over a period of 21 days consisting of the day as of which
"MARKET PRICE" is being determined and the 20 consecutive business days prior to
such day; provided that if such security is listed on any domestic securities
exchange the term "business day" as used in this sentence means business days on
which such exchange is open for trading. If at any time such security is not
listed on any domestic securities exchange or quoted on The NASDAQ Stock Market
or the domestic over-the-counter market, the "MARKET PRICE" shall be the fair
value thereof determined jointly by the Company and the Warrant Holder; provided
that if such holder and the Company are unable to agree within 10 days of
delivery of the notice by the Company in connection with the event giving rise
to the determination of Market Price (or, if earlier, within 3 days of delivery
of a notice by the Company to the holders of Underlying Warrant Stock or by the
Warrant Holder to the Company, in either case requesting designation of an
independent arbitrator), then by an investment banking firm selected by the
American Arbitration Association. The fees and expenses of such investment
banking firm shall be paid by the Company. Any determination of Market Price of
a security will be made without giving effect to any discount for any lack of
liquidity attributable to a lack of a public market for such security, any block
discount or discount attributable to the size of any Person's holdings of such
security, any minority interest or any voting rights thereof or lack thereof.
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"PERSON" means an individual, a partnership, a limited liability company, a
joint venture, a corporation, a trust, an unincorporated organization and a
government or any department or agency thereof.
"REGISTERED HOLDER" with respect to any Warrant means the Person who is
reflected as the holder thereof on the register maintained by the Company for
such purpose, and "REGISTERED HOLDERS" at any time means all Registered Holder
of Warrants then outstanding.
"UNDERLYING WARRANT STOCK" means (i) Common Stock issued or issuable upon
exercise of this Warrant and any Common Stock issued or issuable with respect to
such Common Stock by way of stock dividend or stock split or in connection with
a combination or other reorganization. For purposes of this Warrant, any Person
who holds Warrants shall be deemed to be the holder of the Underlying Warrant
Stock obtainable upon exercise of the Warrants in connection with the transfer
thereof or otherwise regardless of any restriction or limitation on the exercise
of the Warrants. As to any particular shares of Underlying Warrant Stock, such
shares shall cease to be Underlying Warrant Stock when they have been (a)
effectively registered under the SECURITIES ACT and disposed of in accordance
with the registration statement covering them or (b) distributed to the public
through a broker, dealer or market maker pursuant to Rule 144 under the
SECURITIES ACT (or any similar provision then in force).
"UNDERLYING WARRANT STOCK HOLDER" AND "WARRANT HOLDER" means, respectively, any
holder of Underlying Warrant Stock or of a Warrant.
"WARRANT STOCK" means the Common; provided that if there is a change such that
the securities issuable upon exercise of the Warrants originally exercisable
into Common are issued by an entity other than the Company or there is a change
in the class of securities so issuable, then the term "Common Warrant Stock"
shall mean one share of the security issuable upon exercise of such Warrants if
such security is issuable in shares, or shall mean the smallest unit in which
such security is issuable if such security is not issuable in shares. .
SECTION 8
GENERAL
8.1 NO VOTING RIGHTS; LIMITATIONS OF LIABILITY
Prior to the exercise of this Warrant and except as otherwise specifically
provided herein, this Warrant shall not entitle the holder hereof to any voting
rights or other rights as a stockholder of the Company. No provision hereof, in
the absence of affirmative action by the Registered Holder to purchase Warrant
Stock, and no enumeration herein of the rights or privileges of the Registered
Holder shall give rise to any liability of such holder for the exercise of
Warrants hereunder or as a stockholder of the Company.
8.2 WARRANT TRANSFERABLE
Subject to this Section 8.2, this Warrant and all rights hereunder are
transferable, in whole or in part, without charge to the Registered Holder, upon
surrender of this Warrant with a properly executed Assignment (in the form of
EXHIBIT II hereto) at the principal office of the Company.
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The Registered Holder, by acceptance hereof, represents and warrants that (a)
it is acquiring this Warrant for its own account for investment purposes only
and not with a view to its resale or distribution and (b) it has no present
intention to resell or otherwise dispose of all or any part of this Warrant.
Other than pursuant to registration under federal and state securities laws
or an exemption from such registration, the availability of which the Company
shall determine in its sole discretion, (y) the Company will not accept the
exercise of this Warrant or issue certificates for shares of Warrant Stock
and (z) neither this Warrant nor any shares of Warrant Stock may be sold,
pledged, assigned or otherwise disposed of (whether voluntarily or
involuntarily). The Company man condition such issuance or sale, pledge,
assignment or other disposition on the receipt from the party to whom this
Warrant is to be so transferred or to whom Warrant Stock is to be issued or
so transferred of any representations and agreement requested by the Company
in order to permit such issuance or transfer to be made pursuant to
exemptions from registration under federal and applicable state securities
laws. Each certificate representing this Warrant (or any part hereof) and any
shares of Warrant Stock shall be stamped with appropriate legends setting
forth these restrictions on transferability. The Registered Holder, by
acceptance hereof, agrees to give written notice to the Company before
exercising transferring this Warrant or transferring any shares of Warrant
Stock of the Registered Holder's intention to do so, describing briefly the
manner of any proposed exercise or transfer. Within thirty (30) days after
receiving such written notice, the Company shall notify the Registered Holder
as to whether such exercise or transfer may be effected.
8.3 WARRANT EXCHANGEABLE FOR DIFFERENT DENOMINATIONS
This Warrant is exchangeable, upon the surrender hereof by the Registered Holder
at the principal office of the Company, for new Warrants of like tenor
representing in the aggregate the purchase rights hereunder, and each of such
new Warrants shall represent such portion of such rights as is designated by the
Registered Holder at the time of such surrender. All Warrants representing
portions of the rights hereunder are referred to herein as "WARRANTS".
8.4 REPLACEMENT
Upon receipt of evidence reasonably satisfactory to the Company (an affidavit of
the Registered Holder shall be satisfactory) of the loss, theft, destruction or
mutilation of any certificate evidencing this Warrant, and in the case of any
such loss, theft or destruction , upon receipt of an indemnity reasonably
satisfactory to the Company (it being understood that an unsecured indemnity by
any Registered Holder who is a Purchaser or Affiliate of the Purchaser will in
any event be satisfactory), or in the case of any such mutilation, upon
surrender and cancellation of such certificate, the Company shall (at is
expense) execute and deliver in lieu of such certificate a new certificate of
like tenor and dated the date of such lost, stolen, destroyed or mutilated
certificate.
8.5 NOTICES
Except as otherwise expressly provided herein, all notices referred to in this
Warrant shall be in writing and shall be delivered personally, sent by reputable
express courier service (charges prepaid) or sent by registered or certified
mail, return receipt requested, postage prepaid and shall be deemed to have been
given when so delivered, sent or deposited in the U.S. Mail (i) to the Company,
at its principal executive offices, (ii) to the Registered Holder of this
Warrant or to any
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other holder of Underlying Warrant Stock, at such holder's address as it
appears in the records of the Company (unless otherwise indicated by any such
holder).
8.6 AMENDMENT AND WAIVER
Except as otherwise provided herein, the provisions of the Warrants may be
amended and the Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, only if the Company has
obtained the written consent of the Registered Holder.
8.7 DESCRIPTIVE HEADINGS; GOVERNING LAW
The descriptive headings of the several Sections and paragraphs of this Warrant
are inserted for convenience only and do not constitute a part of this Warrant.
The corporate law of the State of Minnesota shall govern all issues concerning
the relative rights of the Company and its stockholders. All other questions
concerning the construction, validity and interpretation of this Warrant shall
be governed by and construed and enforced in accordance with the laws of the
State of Minnesota, without giving effect to any choice of law or conflict
provision or rule (whether of the State of Minnesota or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
State of Minnesota.
CERTAIN EXPENSES
The Company shall pay all expenses incurred in connection with, and all taxes
(other than stock transfer taxes) and other governmental charges that may be
imposed in respect of, the issuance, sale and delivery of the Warrants or the
shares of Warrant Stock.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
and attested by its duly authorized officers under its corporate seal and to be
dated the date first set forth above.
NICOLLETT PROCESSING
ENGINEERING, INC.
Per:
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Title
Attest:
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Secretary
EXHIBIT I
EXERCISE AGREEMENT
To: Dated:
The undersigned, pursuant to the provisions set forth in the attached
Warrant (Certificate No. PW-____), hereby agrees to subscribe for the purchase
of ____ shares of the Warrant Stock covered by such Warrant and makes payment
herewith in full therefor at the price per share provided by such Warrant.
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Signature
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Address
EXHIBIT II
ASSIGNMENT
FOR VALUE RECEIVED, __________________________________________________
hereby sells, assigns and transfers all of the rights of the undersigned under
the attached Warrant (Certificate No. PW-_____ ) with respect to the number of
shares of the Warrant Stock covered thereby set forth below, unto:
NAME OF ASSIGNEE ADDRESS NO. OF SHARES
Dated:
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Signature
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Witness