Exhibit 4.3
THE WARRANT REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES TO BE ISSUED UPON
ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
1933 (THE "SECURITIES ACT") OR APPLICABLE STATE SECURITIES LAWS (THE "STATE
ACTS") AND SHALL NOT BE SOLD OR TRANSFERRED UNLESS SUCH SALE OR TRANSFER HAS
BEEN REGISTERED UNDER THE SECURITIES ACT AND STATE ACTS, OR AN EXEMPTION FROM
THE REGISTRATION REQUIREMENTS IS AVAILABLE, THE AVAILABILITY OF WHICH MUST BE
ESTABLISHED TO THE SATISFACTION OF THE COMPANY.
REDEMPTION WARRANT
WARRANT NO. ___________ NUMBER OF SHARES: _________
SMARTIRE SYSTEMS, INC.
COMMON STOCK, PAR VALUE $.001 PER SHARE
This Warrant is issued to ___________________ ("Holder") by SmarTire
Systems, Inc., a Yukon Territory corporation (hereinafter with its successors
called the "Company").
For value received and subject to the terms and conditions hereinafter
set out, in the event that the Company exercises its right of redemption for
either all or a portion of the outstanding 5% convertible debentures which were
issued to the Holder pursuant to a private placement by the Company, and upon
three (3) days advanced written notice to the Holder by the Company, the Holder
shall receive for every $100,000 invested, a warrant to purchase 50,000 shares
of common stock, par value $.001 per share ("Common Shares") of the Company. The
warrants are exercisable at 120% of the closing bid price on the Company's
common stock as reported by Bloomberg, L.P. for the trading day immediately
preceding the date on which the notice of exercise is sent to the Company. Such
exercise price per Common Share, adjusted from time to time as provided herein,
is referred to as the "Exercise Price."
1. The Holder may exercise this Warrant, in whole or in part, upon
surrender of this Warrant, with the exercise form annexed hereto duly executed,
at the office of the Company, or such other office as the Company shall notify
the Holder in writing, together with a certified or bank cashier's check payable
to the order of the Company in the amount of the Exercise Price times the number
of Common Shares being exercised.
2. The person or persons in whose name or names any certificate
representing Common Shares is issued hereunder shall be deemed to have become
the holder of record of the Common Shares represented thereby as of the close of
business on the date on which this Warrant is exercised with respect to such
shares, whether or not the transfer books of the Company shall be closed. Until
such time as this Warrant is exercised or terminates, the Exercise Price payable
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and the number and character of securities issuable upon exercise of this
Warrant are subject to adjustment as hereinafter provided.
3. Unless previously exercised, this Warrant shall expire at 5:00 p.m.
Eastern Standard Time, two (2) years from the date of issuance and shall be void
thereafter or can be extended at the Company's discretion ("Expiration Date").
4. The Company covenants that it will at all times reserve and keep
available a number of its authorized Common Shares, free from all preemptive
rights, which will be sufficient to permit the exercise of this Warrant. The
Company further covenants that such shares as may be issued pursuant to the
exercise of this Warrant will, upon issuance, be duly and validly issued, fully
paid and nonassessable and free from all taxes, liens, and charges.
5. If the Company subdivides its outstanding Common Shares, by split-up
or otherwise, or combines its outstanding Common Shares, the Exercise Price then
applicable to shares covered by this Warrant shall forthwith be proportionately
decreased in the case of a subdivision, or proportionately increased in the case
of a combination.
6. If (a) the Company reorganizes its capital, reclassifies its capital
stock, consolidates or merges with or into another corporation (but only if the
Company is not the surviving corporation and no longer has more than a single
shareholder) or sells, transfers or otherwise disposes of all or substantially
all its property, assets, or business to another corporation, and (b) 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 exercise
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 Shares, then (c) Holder shall have the right thereafter to
receive, upon exercise of this Warrant, the same number of shares of common
stock of the successor or acquiring corporation and Other Property receivable
upon such reorganization, reclassification, merger, consolidation, or
disposition of assets as a holder of the number of Common Shares for which this
Warrant is exercisable immediately prior to such event. At the time of such
reorganization, reclassification, merger, consolidation or disposition of
assets, the successor or acquiring corporation 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 by resolution of the Board of Directors of the
Company) in order to adjust the number of shares of the common stock of the
successor or acquiring corporation for which this Warrant is exercisable. For
purposes of this section, "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
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foregoing provisions of this section shall similarly apply to successive
reorganizations, reclassifications, mergers, consolidations, or disposition of
assets.
7. If a voluntary or involuntary dissolution, liquidation or winding up
of the Company (other than in connection with a merger or consolidation of the
Company) is at any time proposed during the term of this Warrant, the Company
shall give written notice to the Holder at least thirty days prior to the record
date of the proposed transaction. The notice shall contain: (1) the date on
which the transaction is to take place; (2) the record date (which must be at
least thirty days after the giving of the notice) as of which holders of the
Common Shares entitled to receive distributions as a result of the transaction
shall be determined; (3) a brief description of the transaction; (4) a brief
description of the distributions, if any, to be made to holders of the Common
Shares as a result of the transaction; and (5) an estimate of the fair market
value of the distributions. On the date of the transaction, if it actually
occurs, this Warrant and all rights existing under this Warrant shall terminate.
8. In no event shall any fractional Common Share of the Company be
issued upon any exercise of this Warrant. If, upon exercise of this Warrant as
an entirety, the Holder would, except as provided in this Section 8, be entitled
to receive a fractional Common Share, then the Company shall issue the next
higher number of full Common Shares, issuing a full share with respect to such
fractional share. If this Warrant is exercised at one time for less than the
maximum number of Common Shares purchasable upon the exercise hereof, the
Company shall issue to the Holder a new warrant of like tenor and date
representing the number of Common Shares equal to the difference between the
number of shares purchasable upon full exercise of this Warrant and the number
of shares that were exercised upon the exercise of this Warrant.
9. No adjustments in the Exercise Price shall be required unless such
adjustment would require an increase or decrease of at least five cents in such
price, provided however, that any adjustments which by reason of this Section 9
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment.
10. Whenever the Exercise Price is adjusted, as herein provided, the
Company shall promptly deliver to the Holder a certificate setting forth the
Exercise Price after such adjustment and setting forth a brief statement of the
facts requiring such adjustment.
11. If at any time prior to the expiration or exercise of this Warrant,
the Company shall pay any dividend or make any distribution upon its Common
Shares or shall make any subdivision or combination of, or other change in its
Common Shares, the Company shall cause notice thereof to be mailed, first class,
postage prepaid, to Holder at least thirty full business days prior to the
record date set for determining the holders of Common Shares who shall
participate in such dividend, distribution, subdivision, combination or other
change. Such notice shall also specify the record date as of which holders of
Common Shares who shall participate in such dividend or distribution is to be
determined. Failure to give such notice, or any defect therein, shall not affect
the legality or validity of any dividend or distribution.
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12. The Company will maintain a register containing the names and
addresses of the Holder and any assignees of this Warrant. Holder may change its
address as shown on the warrant register by written notice to the Company
requesting such change. Any notice or written communication required or
permitted to be given to the Holder may be delivered by confirmed facsimile or
telecopy or by a recognized overnight courier, addressed to Holder at the
address shown on the warrant register.
13. This Warrant has not been registered under the Securities Act of
1933, as amended (the "Securities Act"), or any state securities laws ("State
Acts") or regulations in reliance upon exemptions under the Securities Act, and
exemptions under the State Acts. Subject to compliance with the Securities Act
and State Acts, this Warrant and all rights hereunder are transferable in whole
or in part, at the office of the Company at which this Warrant is exercisable,
upon surrender of this Warrant together with the assignment hereof properly
endorsed.
14. In case this Warrant shall be mutilated, lost, stolen, or
destroyed, the Company may issue a new warrant of like tenor and denomination
and deliver the same (a) in exchange and substitution for and upon surrender and
cancellation of any mutilated Warrant, or (b) in lieu of any Warrant lost,
stolen, or destroyed, upon receipt of evidence satisfactory to the Company of
the loss, theft or destruction of such Warrant (including a reasonably detailed
affidavit with respect to the circumstances of any loss, theft, or destruction)
and of indemnity with sufficient surety satisfactory to the Company.
15. Unless a current registration statement under the Securities Act,
shall be in effect with respect to the securities to be issued upon exercise of
this Warrant, the Holder, by accepting this Warrant, covenants and agrees that,
at the time of exercise hereof, and at the time of any proposed transfer of
securities acquired upon exercise hereof, the Company may require Holder to make
such representations, and may place such legends on certificates representing
the Common Shares issuable upon exercise of this Warrant, as may be reasonably
required in the opinion of counsel to the Company to permit such Common Shares
to be issued without such registration.
16. This Warrant does not entitle Holder to any of the rights of a
stockholder of the Company.
17. Nothing expressed in this Agreement and nothing that may be implied
from any of the provisions hereof is intended, or shall be construed, to confer
upon, or give to, any person or corporation other than the parties to this
Agreement any covenant, condition, stipulation, promise, or agreement contained
herein, and all covenants, conditions, stipulations, promises and agreements
contained herein shall be for the sole and exclusive benefit of the parties
hereto and their respective successors and assigns.
18. The provisions and terms of this Warrant shall be construed in
accordance with the laws of the Province of British Columbia, Canada.
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IN WITNESS WHEREOF, this Warrant has been duly executed by the Company
as of the ______ day of _________, 2004.
SMARTIRE SYSTEMS, INC.
By:
----------------------------
Robert Rudman
President & Chief Executive Officer
HOLDER:
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FORM OF EXERCISE
Date: ____________________
To: SMARTIRE SYSTEMS, INC.
The undersigned hereby subscribes for _______ shares of common stock of
SmarTire Systems, Inc. covered by this Warrant. The certificate(s) for such
shares should be issued in the name of the undersigned or as otherwise indicated
below:
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Signature:
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Printed Name
----------------------------
Name for Registration, if different
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Street Address
----------------------------
City, State and Zip Code
----------------------------
Social Security Number
ASSIGNMENT
For Value Received, the undersigned hereby sells, assigns and transfers
unto the assignee(s) set forth below the within Warrant certificate, together
with all right, title and interest therein, and hereby irrevocably constitutes
and appoints ___________________________________ attorney, to transfer the said
Warrant on the books of the within-named Company with respect to the number of
Common Shares set forth below, with full power of substitution in the premises.
Social Security or
other Identifying
Name(s) of Number(s) of No. of
Assignee(s) Assignee(s) Address Shares
- ----------- ------------------ ------- -------
Dated: _______________
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Signature
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT
MUST CORRESPOND WITH THE NAME AS WRITTEN
UPON THE FACE OF THE WARRANT IN EVERY
PARTICULAR, WITHOUT ALTERATION OR
ENLARGEMENT, OR ANY CHANGE WHATSOEVER.
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Print Name and Title