Exhibit 4.2
Warrant Agreement
WARRANT AGREEMENT
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WARRANT AGREEMENT dated as of _________, 2002, between National Beauty Corp., a
Nevada corporation, (the "Company"), and the Warrant Agent (the "Warrant Agent")
whose name, address and signature are set forth below.
WHEREAS, the Company proposes to issue Common Stock Purchase Warrants, as
hereinafter described (the "Warrants"), to Warrant Holders to purchase up to an
aggregate of 4,000,000 shares (subject to adjustment as provided herein) of its
Common Stock, $.001 par value per share (the "Common Stock") (the shares of
Common Stock issuable on exercise of the Warrants being referred to herein as
the "Warrant Shares").
NOW, THEREFORE, in consideration of the foregoing and for the purposes of
defining the terms and provisions of the Warrants and the respective rights and
obligations thereunder of the Company and the registered owners of the Warrants
(the "Holders"), the Company and the Warrant Agent hereby agree as follows:
1. APPOINTMENT OF WARRANT AGENT
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The Company hereby appoints the Warrant Agent to act as agent for the Company in
accordance with the instructions set forth in this Agreement, for the benefit of
the Holders and the Company and the Warrant Agent hereby accepts such
appointment.
2. TRANSFERABILITY AND FORM OF WARRANT
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2.1 REGISTRATION. The Warrants shall be numbered and shall be registered in
a Warrant register as they are issued. The Company and the Warrant Agent shall
be entitled to treat the Holder of any Warrant as the owner in fact thereof for
all purposes, and shall not be bound to recognize any equitable or other claim
to or interest in such Warrant on the part of any other person.
2.2 The Warrants shall be transferable on the books of the Company
maintained at the principal office of the Warrant Agent upon delivery thereof
duly endorsed by the Holder or by his duly authorized attorney or
representative, or accompanied by proper evidence succession, assignment or
authority to transfer. In all cases of transfer by an attorney, the original
power of attorney, duly approved, or a copy thereof, duly certified, shall be
deposited and remain with the Warrant Agent. In case of transfer by executors,
administrators, guardians or other legal representatives, duly authenticated
evidence of their authority shall be produced, and may be required to be
deposited and remain with the Warrant Agent in its discretion. Upon any
registration of transfer the Warrant Agent shall countersign and deliver a new
Warrant or Warrants to the persons entitled thereto.
2.3 FORM OF WARRANT. The text of the Warrant and the Subscription Form
shall be substantially as set forth in Exhibit "A" attached hereto. The price
per Warrant Share and the number of Warrant Shares issuable upon exercise of
each Warrant are subject to adjustment upon the occurrence of certain events,
all as hereinafter provided. The Warrant shall be executed on behalf of the
Company by its Chairman of the Board or President under its corporate seal
reproduced thereon and attested by its Secretary or an Assistant Secretary. The
signature of any such officers on the Warrants may be manual or facsimile.
Warrants bearing the manual or facsimile signature of individuals who were at
any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any one of them shall have ceased to
hold such office prior to the delivery of such Warrants, or did not hold such
office on the date of this Agreement.
Warrants shall be dated as of the date of countersignature thereof by the
Warrant Agent either upon initial issuance or upon division, exchange,
substitution or transfer. Warrants shall be numbered serially.
3. COUNTERSIGNATURE OF WARRANTS
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The Warrants shall be countersigned by the Warrant Agent (or any successor to
the Warrant Agent then acting as Warrant Agent under this Agreement) and shall
not be valid for any purpose unless so countersigned. Warrants may be
countersigned, however, by the Warrant Agent (or by its successor as Warrant
Agent hereunder) and may be delivered by the Warrant Agent notwithstanding that
the persons whose manual or facsimile signatures appear thereon as proper
officers of the Company shall have ceased to be such officers at the time of
such countersignature, issuance or delivery. The Warrant Agent shall, upon
written instruction of the Chairman of the Board, President, or Secretary of the
Company, countersign, issue and deliver Warrants entitling the Holders thereof
to purchase not more than 4,000,000 of Warrant Shares (subject to Section 7
hereof and adjustment pursuant to Section 10 hereof) and shall countersign and
deliver Warrants as otherwise provided in this Agreement.
4. EXCHANGE OF WARRANT CERTIFICATES
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Each Warrant certificate may be exchanged for another certificate or
certificates entitling the Holder thereof to purchase a like aggregate number of
Warrant Shares as the certificate or certificates surrendered then entitle such
Holder to purchase. Any Holder desiring to exchange a Warrant certificate or
certificates shall make such request in writing delivered to the Warrant Agent
and shall surrender, properly endorsed, the certificate or certificates to be so
exchanged. Thereupon, the Warrant Agent shall countersign and deliver to the
person entitled thereto a new Warrant certificate or certificates, as the case
may be, as so requested.
5. TERM OF WARRANTS: EXERCISE OF WARRANTS
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5.1 TERM OF WARRANTS. Subject to the terms of this Agreement, each Holder
shall have the right, which may be exercised commencing on issuance and until
the close of business on ___________, 2005 to purchase from the Company the
number of fully paid and non-assessable Warrant Shares which the Holder may at
the time be entitled to purchase on exercise of such Warrants.
5.2 EXERCISE OF WARRANTS. Warrants may only be exercised for the purchase of
whole Warrant Shares. Warrants may be exercised upon surrender to the Company
at the principal office of the Warrant Agent of the certificate or certificates
evidencing the Warrants to be exercised (except as otherwise provided below),
together with the form of election to purchase on the reverse thereof duly
filled in and signed, and upon payment to the Warrant Agent for the account of
the Company of the Warrant Price (as defined in and determined in accordance
with the provisions of Sections 9 and 10 hereof), for the number of Warrant
Shares in respect of which such Warrants are then exercised.
Subject to Section 6 hereof, upon such surrender of Warrants and payment of the
Warrant Price as aforesaid, the Company shall issue and cause to be delivered
with all reasonable dispatch to or upon the written order of the Holder, and in
such name or names as the Holder may designate, a certificate or certificates
for the number of full Warrant Shares so purchased upon the exercise of such
Warrants, together with cash, as provided in Section 12 hereof, in respect of
any fractional Warrant Shares otherwise issuable upon such exercise of
Warrants. Such certificate or certificates shall be deemed to have been issued
and any person so designated to be named therein shall be deemed to have become
holder of record of such Warrant Shares as of the date of the surrender of such
Warrants and payment of such Warrant Price, as aforesaid; provided, however,
that if, at the date of surrender of such Warrants and payment of such Warrant
Price, the transfer books for the Warrant Shares or other class of stock
purchasable upon the exercise of such Warrants shall be closed, the
certificates for the Warrant Shares in respect of which such Warrants are then
exercised shall be issuable as of the date on which such books shall next be
opened and until such date the Company shall be under no duty to deliver any
certificate for such Warrant Shares provided further, however that the transfer
books of record, unless otherwise required by law, shall not be closed at any
one time for a period of longer than twenty days. The rights of purchase
represented by the Warrants shall be exercisable, at the election of the
Holders thereof, either in full or from time to time in part, and in the event
that a certificate evidencing Warrants is exercised in respect of less than all
of the Warrant Shares purchasable on such exercise at any time prior to the date
of expiration of the Warrant, a new certificate evidencing the remaining Warrant
or Warrants will be issued, and the Warrant Agent is hereby irrevocably
authorized to countersign and to deliver the required new Warrant certificate or
certificates pursuant to the provisions of this Section and of Section 3 hereof;
and the Company, whenever required by the Warrant Agent will supply the Warrant
Agent with Warrant certificates duly executed on behalf of the Company for such
purpose.
6. PAYMENT OF TAXES
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The Company will pay all documentary stamp taxes, if any, attributable to the
initial issuance of Warrant Shares upon the exercise of Warrants; provided,
however, that the Company shall not be required to pay any tax or taxes which
may be payable in respect of any transfer involved in the issue or deliver of
any Warrants or certificates for Warrant Shares in a name other than that of the
registered Holder of Warrants in respect of which such Warrants Shares are
issued.
7. MUTILATED OR MISSING WARRANTS
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In case any of the certificates evidencing the Warrants shall be mutilated,
lost, stolen or destroyed the Company may in its discretion issue and the
Warrant Agent shall countersign and deliver in exchange and substitution for and
upon cancellation of the mutilated Warrant certificate, or in lieu of and
substitution for the Warrant certificate lost, stolen or destroyed, a new
Warrant certificate of like tenor and representing an equivalent right or
interest; but only upon receipt of evidence satisfactory to the Company and the
Warrant Agent of such loss, theft or destruction of such Warrant and indemnity
if requested, also satisfactory to them. An applicant for such a substitute
Warrant certificate shall also comply with such other reasonable regulations and
pay such other reasonable charges as the Company or the Warrant Agency may
prescribe.
8. RESERVATION OF WARRANT SHARES; PURCHASE OF WARRANTS
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8.1 RESERVATION OF WARRANT SHARES. There have been reserved, and the Company
shall at all times keep reserved and available, out of its authorized Common
Stock, such number of shares of Common Stock as shall be sufficient to provide
for the exercise of the rights of purchase represented by the outstanding
Warrants. The Transfer Agent for the Common Stock and every subsequent transfer
agent for any shares of the Company's capital stock issuable upon the exercise
of any of such rights of purchase will be irrevocably authorized and directed at
all times to reserve such number of authorized shares as shall be requisite for
such purpose. The Company will keep a copy of this Agreement on file with the
Transfer Agent or its successors and with every subsequent transfer agent for
any shares of the Company's capital stock issuable upon the exercise of the
rights of purchase represented by the Warrants. The Warrant Agent is hereby
irrevocably authorized to requisition from time to time from the Transfer Agent
or its successors the stock certificates required to honor outstanding Warrants
upon exercise thereof in accordance with the terms of this Agreement. The
Company will supply such Transfer Agent or its successors with duly executed
stock certificates for such purposes and will provide or otherwise make
available any cash which may be payable as provided in Section 12 hereof. All
Warrants surrendered in the exercise of the rights thereby evidenced shall be
canceled by the Warrant Agent and shall thereafter be delivered to the Company.
8.2 PURCHASE OF WARRANTS BY THE COMPANY. The Company shall have the right,
except as limited by law, other agreement or herein, to purchase or otherwise
acquire Warrants at such times, in such manner and for such consideration as it
may deem appropriate.
8.3 CANCELLATION OF WARRANTS. In the event the Company shall purchase or
otherwise acquire Warrants, the same shall thereupon be delivered to the Warrant
Agent and be cancelled by it and retired. The Warrant Agent shall cancel any
Warrants surrendered for exchange, substitution, transfer or exercise in whole
or in part.
9. WARRANT PRICE
The price per share at which Warrant Shares shall be purchasable upon exercise
of Warrants (the "Warrant Price") shall be $.25 per share from the date that the
Warrants are issued until ________, 2005 subject to adjustment pursuant to
Section 10 hereof.
10. ADJUSTMENT OF WARRANT PRICE AND NUMBER OF WARRANT SHARES
The number and kind of securities purchasable upon the exercise of the Warrants
and the Warrant Price shall be subject to adjustment from time to time upon the
happening of certain events, as hereinafter defined.
10.1 MECHANICAL ADJUSTMENTS. Except as provided below, the number of Warrant
Shares purchasable upon the exercise of each Warrant and the Warrant Price shall
be subject to adjustment as follows:
(A) In case the Company shall (i) pay a dividend in shares of Common Stock
or make a distribution in shares of Common Stock, (ii) subdivide its outstanding
shares of Common Stock, (iii) combine its outstanding shares of Common Stock
into a smaller number of shares of Common Stock, or (iv) issue by
reclassification of recapitalization of its shares of Common Stock other
securities of the Company, the number of Warrant Shares purchasable upon
exercise of each Warrant immediately prior thereto shall be adjusted so that the
Holder of each Warrant shall be entitled to receive the kind and number of
Warrant Shares or other securities of the Company which he would have owned or
have been entitled to receive after the happening of any of the events described
above, had such Warrant been exercised immediately prior to the happening of
such event or any record date with respect thereto. An adjustment made pursuant
to this paragraph (a) shall become effective immediately after the effective
date of such event retroactive to the record date, if any, for such event.
(B) In case the Company shall distribute to all holders of its shares of
Common Stock evidence of its indebtedness or assets (excluding cash dividends or
distributions payable out of consolidated earnings or earned surplus and
dividends or distributions referred to in paragraph (a) above) or rights,
options or warrants or convertible or exchangeable securities containing the
right to subscribe for or purchase shares of Common Stock, then in each case the
number of Warrant Shares thereafter purchasable upon the exercise of each
Warrant, by a fraction, of which the numerator shall be the then current market
price per share of Common Stock (as defined in Section 10.1 (c) hereof) on the
date of such distribution, and of which the denominator shall be the then
current market price per share of Common Stock, less the then fair value (as
determined by the Board of Directors of the Company, whose determination shall
be conclusive) of the portion of the assets or evidences of indebtedness so
distributed or of such subscription rights, options or warrants, or of such
convertible or exchangeable securities applicable to one share of Common Stock.
Such adjustment shall be made whenever any such distribution is made, and shall
become effective on the date of distribution retroactive to the record date for
the determination of stockholders entitled to receive such distribution.
(C) For the purpose of any computation under Section 10.1(b) and Section 12
hereof, the current market price per share of Common Stock at any date shall be
the average closing bid price of the Common Stock (if then traded in the
over-the-counter market) or the average closing price of the Common Stock (if
then traded on NASDAQ's National Market System or on a national securities
exchange) for the five consecutive trading days ending the day prior to the date
as of which such computation is made. If the Common Stock is not so listed or
admitted to unlisted trading privileges and bid or closing prices are not so
reported, the current market price per share shall be determined in such
reasonable manner as may be prescribed by the Board of Directors of the Company.
(D) No adjustment in the number of Warrant Shares purchasable hereunder
shall be required unless such adjustment would require an increase or decrease
of at least 1% in the number of Warrant Shares purchasable upon the exercise of
each Warrant; provided, however, that any adjustments which by reason of this
Section 10.1(d) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations shall be made to
the nearest one-thousandth of a share.
(E) Whenever the number of Warrant Shares purchasable upon the exercise of
each Warrant is adjusted, as herein provided, the Warrant Price payable upon
exercise of each Warrant in effect immediately prior to such adjustment, shall
be adjusted by multiplying such Warrant Price immediately prior to such
adjustment by a fraction, of which the numerator shall be the number of Warrant
Shares purchasable upon the exercise of each Warrant immediately prior to such
adjustment, and of which the denominator shall be the number of Warrant Shares
so purchasable immediately thereafter.
(F) For the purpose of this Section 10.1, the term "shares of Common Stock"
shall mean (i) the class of stock designated as the Common Stock of the Company
at the date of this Agreement, or (ii) any other class of stock resulting from
successive changes or reclassification of such shares consisting solely of
changes in par value, or from par value to no par value, or from no par value to
par value. In the event that at any time, as a result of an adjustment made
pursuant to paragraph (a) above, the Holders shall become entitled to purchase
any shares of the Company other than shares of Common Stock, thereafter the
number of such other shares so purchasable upon exercise of each Warrant and the
Warrant Price of such shares shall be subject to adjustment from time to time in
a manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Warrants Shares contained in Section 10.1(a) through Section
10.1(e), inclusive, above, and the provisions of Section 5 and Sections 10.2 and
10.3 hereof, with respect to the Warrant Shares, shall apply on like terms to
any such other shares.
10.2 NOTICE OF ADJUSTMENT. Whenever the number Warrant Shares purchasable
upon the exercise of each Warrant or the Warrant Price of such Warrant Shares is
adjusted, as herein provided, the Company shall cause the Warrant Agent promptly
to mail by first class mail, postage repaid, to each Holder notice of such
adjustment or adjustments, and shall deliver to the Warrant Agent a certificate
of a firm of independent public accountants selected by the Board of Directors
of the Company (who may be the regular accountants employed by the Company)
setting forth the number of Warrant Shares purchasable upon the exercise of each
Warrant and the Warrant Price of such Warrant Shares 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
certificate shall be conclusive of the correctness of such adjustment. The
Warrant Agent shall be entitled to rely on such certificate and shall be under
no duty or responsibility with respect to any such certificate, except to
exhibit the same, from time to time, to any Holder desiring an inspection
thereof during reasonable business hours. The Warrant Agent shall not at any
time be under any duty or responsibility to any Holders to determine whether any
facts exist which may require any adjustment of the Warrant Price or the number
of Warrant Share or other stock or property purchasable on exercise thereof, or
with respect to the nature or extent of any such adjustment when made, or with
respect to the method employed in making such adjustment.
10.3 NO ADJUSTMENT FOR DIVIDENDS. Except as provided in Subsection 10.1, no
adjustment in respect of any cash dividend shall be made during the term of a
Warrant or upon the exercise of a Warrant.
10.4 PRESERVATION OF PURCHASE RIGHTS UPON CONSOLIDATION, ETC. In case of
any consolidation of the Company with or merger of the Company into another
corporation, or in case of any sale or conveyance to another corporation of the
property of the Company as an entirety or substantially as an entirety, the
Company or such successor or purchasing corporation, as the case may be, shall
execute with the Warrant Agent an agreement that each Holder shall have the
right thereafter upon payment of the Warrant Price in effect immediately prior
to such action to purchase upon exercise of each Warrant the kind and amount of
shares and other securities and property which he would have owned or have been
entitled to receive after the happening of such consolidation, merger, sale or
conveyance, had such Warrant been exercised immediately prior to such action.
The Company shall mail by first class mail, postage prepaid, to each Holder,
notice of the execution of any such agreement. Such agreement shall provide for
adjustments, which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 10. The provision of this Section 10.4
shall similarly apply to successive consolidations, mergers, sales or
conveyances. The Warrant Agent shall be under no duty or responsibility to
determine the correctness of any provisions contained in any such agreement
relating either to the kind or amount of shares of stock or other securities or
property receivable upon exercise of Warrants or with respect to the method
employed and provided therein for any adjustments.
10.5 REDUCTION OF WARRANT PRICE. The Company shall have the right to reduce
the Warrant Price at any time upon thirty days prior written notice to all
Holders.
10.6 STATEMENT ON WARRANTS. Irrespective of any adjustments in the Warrant
Price or the number of kind of shares purchasable upon the exercise of the
Warrants, Warrant certificates theretofore or thereafter issued may continue to
express the same price and number and kind of shares as are stated in the
Warrant certificates initially issuable pursuant to this Agreement.
11. EXPIRATION OF WARRANTS
At the close of business on ___________, 2005 all outstanding Warrants shall
become void, and all rights of all Holders thereof and thereunder and under this
Agreement shall cease.
12. FRACTIONAL SHARES
The Company shall not be required to issue fractional Warrant Shares on the
exercise of Warrants. The number of full Warrant Shares which shall be issuable
upon the exercise of Warrants shall be computed on the basis of the aggregate
number of Warrant Shares purchasable on exercise of the Warrant so presented.
If any fraction of a Warrant Share would, except for the provisions of this
Section 12, be issuable on the exercise of any Warrant (or specified portion
thereof), the Company shall pay an amount in cash equal to the then current
market price per Warrant Share (as defined in Section 10.1(c) above) multiplied
by such fraction.
13. NO RIGHTS AS STOCKHOLDERS; NOTICE TO HOLDERS
Nothing contained in this Agreement or in any of the Warrants shall be construed
as conferring upon the Holders or their transferees the right to vote or to
receive dividends or to consent to or receive notice as stockholders in respect
of any meeting of stockholders for the election of Directors of the Company or
any other matter, or any rights whatsoever as stockholders of the Company. If,
however, at any time prior to the expiration of the Warrants and prior to their
exercise, any of the following events shall occur:
(A) the Company shall declare any dividend payable in any securities upon
its shares of Common Stock, or make any distribution (other than a cash
dividend) to the Holders of its shares of Common Stock; or
(B) the Company shall offer to the holders of its shares of Common Stock any
additional shares of Common Stock or securities convertible into shares of
Common Stock or any rights to subscribe thereto; or
(C) a dissolution, liquidation or winding up of the Company (other than in
connection with a consolidation, merger, or sale of all or substantially all of
its property, assets, and business as an entirety) shall be proposed; then, in
any one or more of said events, the Company shall (i) give notice in writing of
such event to the Warrant Agent and the Holders as provided in Section 19 hereof
and (ii) cause notice of such event to be published once in one or more
newspapers printed in the English language and in general circulation in Carson
City, Nevada such giving of notice and publication to be completed at least
fifteen days prior to the date fixed as a record date or the date of closing the
transfer books for the determination of the stockholders entitled to such
dividend, distribution, or subscription rights, or for the determination of
stockholders entitled to vote on such proposed dissolution, liquidation or
winding up. Such notice shall specify such record date or the date of closing
the transfer books, as the case may be. Failure to publish or mail such notice
or any defect therein or in the publication or mailing thereof shall not affect
the validity of any action taken in connection with such dividend, distribution
or subscription rights, or proposed dissolution, liquidation or winding up.
14. DISPOSITION OF PROCEEDS ON EXERCISE OF WARRANTS; INSPECTION OF WARRANT
AGREEMENT
The Warrant Agent shall account promptly to the Company with respect to Warrants
exercised and concurrently pay the Company all monies received by the Warrant
Agent for the purchase of the Warrant Shares through the exercise of such
Warrants.
The Warrant Agent shall keep copies of this Agreement and any notices given or
received hereunder available for inspection by the Holders during normal
business hours at its principal office. The Company shall supply the Warrant
Agent from time to time with such numbers of copies of this Agreement as the
Warrant Agent may request.
15. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT
Any corporation into which the Warrant Agent may be merged or with which it may
be consolidated, or any corporation resulting from any merger or consolidation
to which the Warrant Agent shall be a party, shall be the successor to the
Warrant Agent hereunder without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor Warrant Agent under
the provisions of Section 17 hereof. In case at the time such successor the
Warrant Agent shall succeed to the agency created by this Agreement, any of the
Warrants shall have been countersigned but not delivered, any such successor to
the Warrant Agent may adopt the countersignature of the original Warrant Agent
and deliver such Warrants so countersigned; and in case at that time any of the
Warrants shall not have been countersigned, any successor the Warrant Agent may
countersign such Warrants either in the name of the predecessor Warrant Agent
or in the name of the successor Warrant Agent; and in all such cases Warrants
shall have the full force provided in the Warrants and in this Agreement.
In case at any time the name of the Warrant Agent shall be changed and at such
time any of the Warrants shall have been countersigned but not delivered, the
Warrant Agent may adopt the countersignatures under its prior name and deliver
such Warrants so countersigned; and in case at that time any of the Warrants
shall not have been countersigned, the Warrant Agent may countersign such
Warrants wither in its prior name or in its changed name; and in all such cases
such Warrants shall have the full force provided in the Warrants and in this
Agreement.
16. CONCERNING THE WARRANT AGENT
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The Warrant Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all of which the Company
and the Holders, by their acceptance of Warrants, shall be bound:
16.1 CORRECTNESS OF STATEMENTS. The statements contained herein and in the
Warrants shall be taken as statements of the Company and the Warrant Agent
assumes no responsibility for the correctness of any of the same except such as
describe the Warrant Agent or action taken by it. The Warrant Agent assumes no
responsibility with respect to the distribution of the Warrants except as herein
otherwise provided.
16.2 BREACH OF COVENANTS. The Warrant Agent shall not be responsible for
any failure of the Company to comply with the covenants contained in this
Agreement or in the Warrants to be complied with by the Company.
16.3 PERFORMANCE OF DUTIES. The Warrant Agent may execute any of the rights
or powers hereby vested in it or perform any duty hereunder either itself or by
or through its attorneys or agents (which shall not include its employees).
16.4 RELIANCE ON COUNSEL. The Warrant Agent may consult at any time with
legal counsel satisfactory to it (who may be counsel for the Company), and the
Warrant Agent shall incur no liability or responsibility to the Company or to
any Holder in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with the opinion or the advice of such counsel.
16.5 PROOF OF ACTIONS TAKEN. Whenever in the performance of its duties
under this Agreement the Warrant Agent shall deem it necessary or desirable that
any fact or matter be proved or established by the Company prior to taking or
suffering any action hereunder, such fact or matter (unless other evidence in
respect thereof be herein specifically prescribed) may be deemed conclusively to
be proved and established by a certificate signed by the Chairman of the Board,
President, Treasurer or Secretary of the Company and delivered to the Warrant
Agent; and such certificate shall be full authorization to the Warrant Agent for
any action taken or suffered in good faith by it under the provisions of this
Agreement in reliance upon such certificate.
16.6 COMPENSATION. The Company agrees to pay the Warrant Agent reasonable
compensation for all services rendered by the Warrant Agent in the performance
of its duties under this Agreement, to reimburse the Warrant Agent for all
expenses, taxes and governmental charges and other charges of any kind and
nature incurred by the Warrant Agent in the performance of its duties under this
Agreement, and to indemnify the Warrant Agent and hold it harmless against any
and all liabilities, including judgments, costs and fees arising as a result of
the Warrant Agent's negligence or bad faith.
16.7 LEGAL PROCEEDINGS. The Agent shall be under no obligation to
institute any action, suit or legal proceeding or to take any other action
likely to involve expense unless the Company or one or more Holders shall
furnish the Warrant Agent with reasonable security and indemnity for any costs
and expenses which may be incurred, but the provision shall not affect the power
of the Warrant Agent to take such action as the Warrant Agent may consider
proper, whether with or without any such security or indemnity. All rights of
action under this Agreement or under any of the Warrants may be enforced by the
Warrant Agent without possession of any of the Warrants or the production
thereof at any trial or other proceeding relative thereto, and any such action,
suit or proceeding instituted by the Warrant Agent shall be brought in its name
as Warrant Agent, and any recovery of judgment shall be for the ratable benefit
of the Holders, as their respective rights or interests may appear.
16.8 OTHER TRANSACTIONS IN SECURITIES OF COMPANY. The Warrant Agent and any
stockholder, director, officer or employee of the Warrant Agent may buy, sell or
deal in any of the Warrants, or other securities of the Company or become
pecuniarily interested in any transaction in which the Company may be
interested, or contract with the Company or otherwise act as fully and freely as
though it were not Warrant Agent under this Agreement. Nothing herein shall
preclude the Warrant Agent from acting in any other capacity for the Company or
for any other legal entity.
16.9 LIABILITY OF WARRANT AGENT. The Warrant Agent shall act hereunder
solely as agent, and its duties shall be determined solely by the provisions
thereof. The Warrant Agent shall not be liable for anything which it may do or
refrain from doing in connection with this Agreement except for its own
negligence or bad faith.
16.10 RELIANCE ON DOCUMENTS. The Warrant Agent will not incur any
liability or responsibility to the Company or to any Holder for any action taken
in reliance on any notice, resolution, waiver, consent, order, certificate, or
other paper, document of instrument reasonably believed by it to be genuine and
to have been signed, sent or present by the proper party or parties.
16.11 VALIDITY OF AGREEMENT, ETC. The Warrant Agent shall not be under any
responsibility in respect of the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the Warrant Agent) or in
respect of the validity or execution of any Warrant (except its countersignature
thereof) or in respect of the necessity or the extent of any adjustment to the
Warrant Price or the number of Warrant Shares purchasable under a Warrant; nor
shall the Warrant Agent by any act hereunder be deemed to make any
representation or warranty as to the authorization, reservation, value or
registration under securities laws of any Warrant Shares (or other stock) to be
issued pursuant to this Agreement or any Warrant, as to whether any Warrant
Share (or other stock) will, when issued, be validly issued, fully paid and
non-assessable, or as to the Warrant Price or the number of amount of Warrant
Shares or other securities or other property issuable upon exercise of any
Warrant of the method employed in making any adjustment to the foregoing.
16.12 INSTRUCTIONS FROM COMPANY. The Warrant Agent is hereby authorized
and directed to accept instructions with respect to the performance of its
duties hereunder from the Chairman of the Board, the President, the Secretary or
the Treasurer of the Company and, with respect to Section 2.2 hereof, the
representative, and to apply to such officers or the representative, as the case
may be, for advice or instructions in connection with its duties, and shall not
be liable for any action taken or suffered to be taken by it in good faith in
accordance with instruction of any such officer or officers or the
representative, as the case may be.
17. CHANGE OF WARRANT AGENT
--------------------------
The Warrant Agent may resign and be discharged from all further duties and
liabilities under this Agreement (except liabilities arising as a result of the
Warrant Agent's own negligence or bad faith) by giving to the Company thirty
days prior notice in writing. The Warrant Agent may be removed by like notice
to the Warrant Agent from the Company. If the Warrant Agent shall resign or be
removed or shall otherwise become incapable of acting, the Company shall appoint
a successor to the Warrant Agent. If the Company shall fail to make such
appointment within a period of thirty days after such removal or after it has
been notified in writing of such resignation or incapacity by the resigning or
incapacitated Warrant Agent or by any Holder (who shall with such notice submit
his Warrant for inspection by the Company), then the Holder may apply to any
court of competent jurisdiction for the appointment of a successor to the
Warrant Agent. Any successor Warrant agent, whether appointed by the Company or
such a court, shall be a bank or trust company, in good standing, incorporated
under the laws of the United States of America or any state thereof and having
at the time of its appointment as Warrant agent a combined capital and surplus
of a least $50,000,000, or a stock transfer company. After acceptance in
writing of such appointment is received by the Company, the successor agent
shall be vested with the same powers, rights, duties and responsibilities as if
it had been originally named as Warrant Agent without further act or deed; but
the former Warrant Agent shall deliver and transfer to the successor Warrant
agent any property at the time held by it hereunder, and legally and validly
execute and deliver any further assurance, conveyance, act or deed necessary for
that purpose. Failure to file any notice provided for in this Section 17,
however, or any defect therein, shall not affect the legality or validity of the
resignation or removal of the Warrant Agent or the appointment of the successor
Warrant agent, as the case may be. In the event of such resignation or removal,
the successor Warrant agent shall mail by first class mail, postage prepaid, to
each Holder, written notice of such resignation or removal and the name and
address of such successor Warrant agent.
18. IDENTITY OF TRANSFER AGENT
-----------------------------
Forthwith upon the appointment of any subsequent transfer agent for the Common
Stock or any other shares of the Company's capital stock issuable upon the
exercise of the Warrants, the Company will file with the Warrant Agent a
statement setting forth the name and address of such subsequent transfer agent.
19. NOTICES
-------
Any notice pursuant to the Agreement by the Company, or by any Holder to the
Warrant Agent, or by the Warrant Agent or by any Holder to the Company, shall be
in writing and shall be mailed first class, postage prepaid, or deliver (a) to
the Company, at its offices Attention: President; (b) the Holder of the Warrant;
at the address shown on the records of the Company or (c) to Warrant Agent, at
its offices. Each party hereto may from time to time change address to which
notices to it are to be delivered or mailed hereunder by notice in writing to
the other party.
Any notice mailed pursuant to this Agreement by the Company or the Warrant Agent
to the Holders shall be in writing and shall be mailed first class, postage
prepaid, or delivered to such Holders at their respective addresses on the books
of the Warrant Agent.
20. SUPPLEMENTS AND AMENDMENTS
----------------------------
The company and the Warrant Agent may from time to time supplement or amend this
Agreement, in order to cure any ambiguity or to correct or supplement any
provision contained herein which may be defective or inconsistent with any other
provision herein, or to make any other provisions in regard to matters or
questions arising hereunder which the Company and the Warrant Agent may deem
necessary or desirable, and which shall not be inconsistent with the provisions
of the Warrants and which shall not adversely affect the interests of the
Holders; provided, however, that this Agreement shall not otherwise be
supplemented or amended in any respect except with the consent in writing of the
Holders of Warrants representing not less than 50% of the Warrants then
outstanding; and provided further that no change in the number or nature of the
securities purchasable upon the exercise of any Warrant, or the Purchase Price
therefore shall be made without the consent in writing of the Holder of the
certificate representing such Warrant, other than changes as are specifically
prescribed by this Agreement as originally executed.
21. SUCCESSORS
----------
All the covenants and provisions of this Agreement by or for the benefit of the
Company or the Warrant Agent shall bind and inure to the benefit of their
respective successors and assigns.
22. APPLICABLE LAW
---------------
This Agreement and each Warrant issued hereunder shall be governed by and
construed in accordance with the laws of the State of Nevada, without giving
effect to any principles of conflicts of law.
23. BENEFITS OF THIS AGREEMENT
-----------------------------
Nothing in this Agreement shall be construed to give any person or corporation
other than the Company, the Warrant Agent and the Holders any legal or equitable
right, remedy or claim under this Agreement, this Agreement shall be for the
sole and exclusive benefit of the Company, the Warrant Agent and the Holders of
the Warrants.
24. COUNTERPARTS
------------
This Agreement may be executed in any number of counterparts, and each of such
counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same instrument.
25. CAPTIONS
--------
The captions of the Sections and Subsections of this Agreement have been
inserted for convenience only and shall have no substantive effect.
26. TERMINATION
-----------
This Agreement shall terminate at the close of business on ________, 2005 or
such earlier date upon which all Warrants have been exercised, except that the
Warrant Agent shall account to the Company for any cash held by the Warrant
Agent after the termination hereof.
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IN WITNESS WHEREOF this Warrant Agreement has been executed by the undersigned
to be effective as of the date set forth above.
National Beauty Corp.
By: ______________
Name: Edward Roth
Title: President
Warrant Agent
By: _____________
Name: _____________
Title: ______________
_____________________