exv10w57



 





EXHIBIT 10.57




THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE
OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. THIS WARRANT
AND THE COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT
UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO ACCERIS
COMMUNICATIONS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.



Right to Purchase up to 1,000,000 Shares of Common Stock of

Acceris Communications Inc.

(subject to adjustment as provided herein)




COMMON STOCK PURCHASE WARRANT




	 	 	 
	No. L1

	 	Issue Date: October 14, 2004







     ACCERIS COMMUNICATIONS INC., a corporation organized under the laws of the
State of Florida (“ACRS”), hereby certifies that, for value received, LAURUS
MASTER FUND, LTD., or assigns (the “Holder”), is entitled, subject to the terms
set forth below, to purchase from the Company (as defined herein) from and
after the Issue Date of this Warrant and at any time or from time to time
before 5:00 p.m., New York time, through the earlier of (i) close of business
October 13, 2009 and (ii) the date on which the average closing price of ACRS
Common Stock for any ten consecutive trading days shall equal or exceed
fifteen (15) times the Exercise Price (below) (the “Expiration Date”), up to
1,000,000 fully paid and nonassessable shares of Common Stock (as hereinafter
defined), $0.01 par value per share, at the applicable Exercise Price per share
(as defined below). The number and character of such shares of Common Stock
and the applicable Exercise Price per share are subject to adjustment as
provided herein.



     As used herein the following terms, unless the context otherwise requires,
have the following respective meanings:




     (a) The term “Company” shall include ACRS and any corporation which
shall succeed, or assume the obligations of, ACRS hereunder.




     (b) The term “Common Stock” includes (i) the Company’s Common Stock,
par value $0.01 per share; and (ii) any other securities into which or
for which any of the securities described in (a) may be converted or
exchanged pursuant to a plan of recapitalization, reorganization, merger,
sale of assets or otherwise.




     (c) The term “Other Securities” refers to any stock (other than
Common Stock) and other securities of the Company or any other person
(corporate or otherwise) which the holder of the Warrant at any time
shall be entitled to receive, or shall have received, on the exercise of
the Warrant, in lieu of or in addition to Common Stock, or



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which at any time shall be issuable or shall have been issued in
exchange for or in replacement of Common Stock or Other Securities
pursuant to Section 4 or otherwise.




     (d) The “Exercise Price” applicable under this Warrant shall be as
follows:




     (i) a price of $1.00 (which price is 125% of the average
closing price of Common Stock for the ten (10) trading days
immediately prior to the date hereof) for the first 250,000 shares
acquired hereunder;




     (ii) a price of $1.08 (which price is 135% of the average
closing price of Common Stock for the ten (10) trading days
immediately prior to the date hereof) for the next 250,000 shares
acquired hereunder; and




     (iii) a price of $1.20 (which price is 150% of the average
closing price of Common Stock for the ten (10) trading days
immediately prior to the date hereof) for any additional shares
acquired hereunder.



     2. Exercise of Warrant.



               2.1 Number of Shares Issuable upon Exercise. From and after the
date hereof through and including the Expiration Date, the Holder shall be
entitled to receive, upon exercise of this Warrant in whole or in part, by
delivery of an original or fax copy of an exercise notice in the form attached
hereto as Exhibit A (the “Exercise Notice”), up to 1,000,000 shares of Common
Stock of the Company, subject to adjustment pursuant to Section 4.



               2.2 Fair Market Value. For purposes hereof, the “Fair Market
Value” of a share of Common Stock as of a particular date (the “Determination
Date”) shall mean:




     (a) If the Company’s Common Stock is traded on the American Stock
Exchange or another national exchange or is quoted on the National or
SmallCap Market of The Nasdaq Stock Market, Inc.(“Nasdaq”), then the
closing or last sale price, respectively, reported for the last business
day immediately preceding the Determination Date.




     (b) If the Company’s Common Stock is not traded on the American
Stock Exchange or another national exchange or on the Nasdaq but is
traded on the NASD OTC Bulletin Board, then the mean of the average of
the closing bid and asked prices reported for the last business day
immediately preceding the Determination Date.




     (c) Except as provided in clause (d) below, if the Company’s Common
Stock is not publicly traded, then as the Holder and the Company agree or
in the absence of agreement by arbitration in accordance with the rules
then in effect of the American Arbitration Association, before a single
arbitrator to be chosen from a panel of persons qualified by education
and training to pass on the matter to be decided.




     (d) If the Determination Date is the date of a liquidation,
dissolution or winding up, or any event deemed to be a liquidation,
dissolution or winding up pursuant to the Company’s charter, then all amounts to be payable per share
to holders of the



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Common Stock pursuant to the charter in the event of
such liquidation, dissolution or winding up, plus all other amounts to be
payable per share in respect of the Common Stock in liquidation under the
charter, assuming for the purposes of this clause (d) that all of the shares of Common Stock then issuable upon exercise of the Warrant are
outstanding at the Determination Date.



               2.3 Intentionally omitted.



               2.4 Trustee for Warrant Holders. In the event that a bank or trust
company shall have been appointed as trustee for the holders of the Warrant
pursuant to Subsection 3.2, such bank or trust company shall have all the
powers and duties of a warrant agent (as hereinafter described) and shall
accept, in its own name for the account of the Company or such successor person
as may be entitled thereto, all amounts otherwise payable to the Company or
such successor, as the case may be, on exercise of this Warrant pursuant to
this Section 1.



     3. Procedure for Exercise.



               3.1 Delivery of Stock Certificates, Etc., on Exercise. The Company
agrees that the shares of Common Stock purchased upon exercise of this Warrant
shall be deemed to be issued to the Holder as the record owner of such shares
as of the close of business on the date on which this Warrant shall have been
surrendered and payment made for such shares in accordance herewith. As soon
as practicable after the exercise of this Warrant in full or in part, and in
any event within three (3) business days thereafter, the Company at its expense
(including the payment by it of any applicable issue taxes) will cause to be
issued in the name of and delivered to the Holder, or as such Holder (upon
payment by such Holder of any applicable transfer taxes) may direct in
compliance with applicable securities laws, a certificate or certificates for
the number of duly and validly issued, fully paid and nonassessable shares of
Common Stock (or Other Securities) to which such Holder shall be entitled on
such exercise, plus, in lieu of any fractional share to which such holder would
otherwise be entitled, cash equal to such fraction multiplied by the then Fair
Market Value of one full share, together with any other stock or other
securities and property (including cash, where applicable) to which such Holder
is entitled upon such exercise pursuant to Section 1 or otherwise.



               3.2 Exercise. Payment may be made either (i) in cash or by
certified or official bank check payable to the order of the Company equal to
the applicable aggregate Exercise Price, (ii) with respect to fifty percent
(50%) of the number of shares of Common Stock issuable upon exercise of this
Warrant, by delivery of the Warrant, or shares of Common Stock and/or Common
Stock receivable upon exercise of the Warrant in accordance with the formula
set forth below, or (iii) by a combination of any of the foregoing methods, for
the number of Common Shares specified in such Exercise Notice (as such exercise
number shall be adjusted to reflect any adjustment in the total number of
shares of Common Stock issuable to the Holder per the terms of this Warrant)
and the Holder shall thereupon be entitled to receive the number of duly
authorized, validly issued, fully-paid and non-assessable shares of Common
Stock (or Other Securities) determined as provided herein. Notwithstanding any
provisions herein to the contrary, if the Fair Market Value of one share of
Common Stock is greater than the Exercise Price (at the date of calculation as set forth below), in lieu of
exercising this Warrant for cash, the Holder may elect to receive shares equal
to the value (as determined below) of this Warrant (or



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the portion thereof
being exercised) by surrender of this Warrant at the principal office of the
Company together with the properly endorsed Exercise Notice in which event the
Company shall issue to the Holder a number of shares of Common Stock computed
using the following formula:




	 	 	 
	X=Y

	 	(A-B)
	

	 	
 
	

	 	   A
	 
	 	 
	Where X =

	 	the number of shares of Common Stock to be issued to the
Holder
	 
	 	 
	Y =

	 	the number of shares of Common Stock purchasable under the
Warrant or, if only a portion of the Warrant is being exercised, the
portion of the Warrant being exercised (at the date of such
calculation)
	 
	 	 
	A =

	 	the Fair Market Value of one share of the Company’s Common
Stock (at the date of such calculation)
	 
	 	 
	B =

	 	Exercise Price (as adjusted to the date of such
calculation)







     4. Effect of Reorganization, Etc.; Adjustment of Exercise Price.



               4.1 Reorganization, Consolidation, Merger, Etc. In case at any
time or from time to time, the Company shall (a) effect a reorganization, (b)
consolidate with or merge into any other person, or (c) transfer all or
substantially all of its properties or assets to any other person under any
plan or arrangement contemplating the dissolution of the Company, then, in each
such case, as a condition to the consummation of such a transaction, proper and
adequate provision shall be made by the Company whereby the Holder of this
Warrant, on the exercise hereof as provided in Section 1 at any time after the
consummation of such reorganization, consolidation or merger or the effective
date of such dissolution, as the case may be, shall receive, in lieu of the
Common Stock (or Other Securities) issuable on such exercise prior to such
consummation or such effective date, the stock and other securities and
property (including cash) to which such Holder would have been entitled upon
such consummation or in connection with such dissolution, as the case may be,
if such Holder had so exercised this Warrant, immediately prior thereto, all
subject to further adjustment thereafter as provided in Section 4.



               4.2 Dissolution. In the event of any dissolution of the Company
following the transfer of all or substantially all of its properties or assets,
the Company, concurrently with any distributions made to holders of its Common
Stock, shall at its expense deliver or cause to be delivered to the Holder the
stock and other securities and property (including cash, where applicable)
receivable by the Holder of the Warrant pursuant to Section 3.1, or, if the
Holder shall so instruct the Company, to a bank or trust company specified by
the Holder and having its principal office in New York, NY as trustee for the
Holder of the Warrant (the “Trustee”).



               4.3 Continuation of Terms. Upon any reorganization, consolidation,
merger or transfer (and any dissolution following any transfer) referred to in
this Section 3, this Warrant shall continue in full force and effect and the terms hereof shall
be applicable to the shares of stock and other securities and property
receivable on the exercise of this Warrant after the consummation of such
reorganization, consolidation or merger or the effective date of dissolution
following any such transfer, as the case may be, and shall be binding upon the
issuer



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of any such stock or other securities, including, in the case of any
such transfer, the person acquiring all or substantially all of the properties
or assets of the Company, whether or not such person shall have expressly
assumed the terms of this Warrant as provided in Section 4. In the event this
Warrant does not continue in full force and effect after the consummation of
the transactions described in this Section 3, then the Company’s securities and
property (including cash, where applicable) receivable by the Holders of the
Warrant will be delivered to Holder or the Trustee as contemplated by Section
3.2.




     5. Extraordinary Events Regarding Common Stock. In the event that
the Company shall (a) issue additional shares of the Common Stock as a dividend
or other distribution on outstanding Common Stock, (b) subdivide its
outstanding shares of Common Stock, or (c) combine its outstanding shares of
the Common Stock into a smaller number of shares of the Common Stock, then, in
each such event, the Exercise Price shall, simultaneously with the happening of
such event, be adjusted by multiplying the then Exercise Price by a fraction,
the numerator of which shall be the number of shares of Common Stock
outstanding immediately prior to such event and the denominator of which shall
be the number of shares of Common Stock outstanding immediately after such
event, and the product so obtained shall thereafter be the Exercise Price then
in effect. The Exercise Price, as so adjusted, shall be readjusted in the same
manner upon the happening of any successive event or events described herein in
this Section 4. The number of shares of Common Stock that the holder of this
Warrant shall thereafter, on the exercise hereof as provided in Section 1, be
entitled to receive shall be increased to a number determined by multiplying
the number of shares of Common Stock that would otherwise (but for the
provisions of this Section 4) be issuable on such exercise by a fraction of
which (a) the numerator is the Exercise Price that would otherwise (but for the
provisions of this Section 4) be in effect, and (b) the denominator is the
Exercise Price in effect on the date of such exercise.



     6. Certificate as to Adjustments. In each case of any adjustment
or readjustment in the shares of Common Stock (or Other Securities) issuable on
the exercise of the Warrant, upon the prior written request of the Holder,
the Company at its expense will promptly cause its Chief Financial Officer or
other appropriate designee to compute such adjustment or readjustment in
accordance with the terms of the Warrant and prepare a certificate setting
forth such adjustment or readjustment and showing in detail the facts upon
which such adjustment or readjustment is based, including a statement of (a)
the consideration received or receivable by the Company for any additional
shares of Common Stock (or Other Securities) issued or sold or deemed to have
been issued or sold, (b) the number of shares of Common Stock (or Other
Securities) outstanding or deemed to be outstanding, and (c) the Exercise Price
and the number of shares of Common Stock to be received upon exercise of this
Warrant, in effect immediately prior to such adjustment or readjustment and as
adjusted or readjusted as provided in this Warrant. The Company will forthwith
mail a copy of each such certificate to the holder of the Warrant and any
Warrant agent of the Company (appointed pursuant to Section 11 hereof).



     7. Reservation of Stock, Etc., Issuable on Exercise of Warrant.
The Company will at all times reserve and keep available, solely for issuance
and delivery on the exercise of the Warrant, shares of Common Stock (or Other
Securities) from time to time issuable on the exercise of the Warrant.



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     8. Assignment; Exchange of Warrant. Subject to compliance with
applicable securities laws, this Warrant, and the rights evidenced hereby, may
be transferred by any registered holder hereof (a “Transferor”) in whole or in
part. On the surrender for exchange of this Warrant, with the Transferor’s
endorsement in the form of Exhibit B attached hereto (the “Transferor
Endorsement Form”) and together with evidence reasonably satisfactory to the
Company demonstrating compliance with applicable securities laws, which shall
include, without limitation, the provision of a legal opinion from the
Transferor’s counsel (at the Company’s expense) that such transfer is exempt
from the registration requirements of applicable securities laws, and with
payment by the Transferor of any applicable transfer taxes) will issue and
deliver to or on the order of the Transferor thereof a new Warrant of like
tenor, in the name of the Transferor and/or the transferee(s) specified in such
Transferor Endorsement Form (each a “Transferee”), calling in the aggregate on
the face or faces thereof for the number of shares of Common Stock called for
on the face or faces of the Warrant so surrendered by the Transferor.



     9. Replacement of Warrant. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of this Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.



     10. Registration Rights. The Holder of this Warrant has been
granted certain registration rights by the Company. These registration rights
are set forth in a Registration Rights Agreement entered into by the Company
and Holder dated as of even date of this Warrant.



     11. Maximum Exercise. The Holder shall not be entitled to exercise
this Warrant on an exercise date, in connection with that number of shares of
Common Stock which would be in excess of the sum of (i) the number of shares of
Common Stock beneficially owned by the Holder and its affiliates on an exercise
date, and (ii) the number of shares of Common Stock issuable upon the exercise
of this Warrant with respect to which the determination of this proviso is
being made on an exercise date, which would result in beneficial ownership by
the Holder and its affiliates of more than 4.99% of the outstanding shares of
Common Stock of the Company on such date. For the purposes of the proviso to
the immediately preceding sentence, beneficial ownership shall be determined in
accordance with Section 13(d) of the Securities Exchange Act of 1934, as
amended, and Regulation 13d-3 thereunder. Notwithstanding the foregoing, the
restriction described in this paragraph may be revoked upon 75 days prior
notice from the Holder to the Company and is automatically null and void upon
an Event of Default under the Note made by the Company to the Holder dated the
date hereof (as amended, modified or supplemented from time to time, the
“Note”).



     12. Warrant Agent. The Company may, by written notice to the each
Holder of the Warrant, appoint an agent for the purpose of issuing Common Stock
(or Other Securities) on the exercise of this Warrant pursuant to Section 1,
exchanging this Warrant pursuant to Section 7, and replacing this Warrant
pursuant to Section 8, or any of the foregoing, and thereafter any such



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issuance, exchange or replacement, as the case may be, shall be made at such
office by such agent.




     13. Transfer on the Company’s Books. Until this Warrant is
transferred on the books of the Company, the Company may treat the registered
holder hereof as the absolute owner hereof for all purposes, notwithstanding
any notice to the contrary.



     14. Notices, Etc. All notices and other communications from the
Company to the Holder of this Warrant shall be mailed by first class registered
or certified mail, postage prepaid, at such address as may have been furnished
to the Company in writing by such Holder or, until any such Holder furnishes to
the Company an address, then to, and at the address of, the last Holder of this
Warrant who has so furnished an address to the Company.



     15. Miscellaneous. This Warrant and any term hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought. This Warrant shall be governed by and construed in
accordance with the laws of State of New York without regard to principles of
conflicts of laws. Any action brought concerning the transactions contemplated
by this Warrant shall be brought only in the state courts of New York or in the
federal courts located in the state of New York; provided, however, that the
Holder may choose to waive this provision and bring an action outside the state
of New York. The individuals executing this Warrant on behalf of the Company
agree to submit to the jurisdiction of such courts and waive trial by jury.
The prevailing party shall be entitled to recover from the other party its
reasonable attorney’s fees and costs. In the event that any provision of this
Warrant is invalid or unenforceable under any applicable statute or rule of
law, then such provision shall be deemed inoperative to the extent that it may
conflict therewith and shall be deemed modified to conform with such statute or
rule of law. Any such provision which may prove invalid or unenforceable under
any law shall not affect the validity or enforceability of any other provision
of this Warrant. The headings in this Warrant are for purposes of reference
only, and shall not limit or otherwise affect any of the terms hereof. The
invalidity or unenforceability of any provision hereof shall in no way affect
the validity or enforceability of any other provision hereof. The Company and
the holder each acknowledge that its respective legal counsel participated in
the preparation of this Warrant and, therefore, stipulates that the rule of
construction that ambiguities are to be resolved against the drafting party
shall not be applied in the interpretation of this Warrant to favor any party
against the other party.



[Balance of page intentionally left blank;

signature page follows.]




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     IN WITNESS WHEREOF, the Company has executed this Warrant as of the date
first written above.



	 	 	 	 	 	 	 
	 	 	ACCERIS COMMUNICATIONS INC.
	 
	 	 	 	 	 	 
	

	 	By:

Name:

Title:
	 	




	 	 







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Exhibit A




FORM OF SUBSCRIPTION

(To Be Signed Only On Exercise Of Warrant)




	 	 	 	 	 	 	 
	TO:	 	ACCERIS COMMUNICATIONS INC.
	

	 	Attention:
	 	Chief Financial Officer	 	 







     The undersigned, pursuant to the provisions set forth in the attached
Warrant (No.                   ), hereby irrevocably elects to purchase (check applicable
box):



	 	 	 
	                   

	 	_________ shares of the Common Stock covered by such Warrant; or
	 
	 	 
	                   

	 	the maximum number of shares of Common Stock covered by such Warrant pursuant
to the cashless exercise procedure set forth in Section 2.







     The undersigned herewith makes payment of the full Exercise Price for such
shares at the price per share provided for in such Warrant, which is
$_______. Such payment takes the form of (check applicable box or boxes):



	 	 	 
	                   

	 	$                    in lawful money of the United States; and/or
	 
	 	 
	                   

	 	the cancellation of such portion of the attached Warrant as is exercisable for
a total of                    shares of Common Stock (using a Fair Market Value of
$                    per share for purposes of this calculation); and/or
	 
	 	 
	                   

	 	the cancellation of such number of shares of Common Stock as is necessary, in
accordance with the formula set forth in Section 2.2, to exercise this Warrant
with respect to the maximum number of shares of Common Stock purchasable
pursuant to the cashless exercise procedure set forth in Section 2.







     The undersigned requests that the certificates for such shares be issued
in the name of, and delivered to                                                           whose address is                                                                             .



     The undersigned represents and warrants that all offers and sales by the
undersigned of the securities issuable upon exercise of the within Warrant
shall be made pursuant to registration of the Common Stock under the Securities
Act of 1933, as amended (the “Securities Act”) or pursuant to an exemption from
registration under the Securities Act.



	 	 	 	 	 
	Dated:                                       	 	

(Signature must conform to name of holder as specified on the face
of the Warrant)
	 
	 	 	 	 
	

	 	Address:
	 	










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Exhibit B




FORM OF TRANSFEROR ENDORSEMENT

(To Be Signed Only On Transfer Of Warrant)




     For value received, the undersigned hereby sells, assigns, and transfers
unto the person(s) named below under the heading “Transferees” the right
represented by the within Warrant to purchase the percentage and number of
shares of Common Stock of ACCERIS COMMUNICATIONS INC. into which the within
Warrant relates specified under the headings “Percentage Transferred” and
“Number Transferred,” respectively, opposite the name(s) of such person(s) and
appoints each such person Attorney to transfer its respective right on the
books of ACCERIS COMMUNICATIONS INC. with full power of substitution in the
premises.



	 	 	 	 	 	 	 
	 	 	 	 	Percentage	 	 
	Transferees
	 	Address
	 	Transferred
	 	Number Transferred

	 
	


	 	

	 	

	 	

	


	 	

	 	

	 	

	


	 	

	 	

	 	

	


	 	

	 	

	 	








	 	 	 	 	 
	Dated:                                       	 	

	 	 	(Signature must conform to name of holder as
specified on the face of the Warrant)
	 
	 	 	 	 
	

	 	Address:
	 	

	

	 	 	 	

	 	 	SIGNED IN THE PRESENCE OF:
	 
	 	 	 	 
	 	 	

	

	 	(Name)
	 
	 	 	 	 
	ACCEPTED AND AGREED:
	 	 	 	 
	[TRANSFEREE]
	 	 	 	 
	                                      
	 	 	 	 
	              (Name)
	 	 	 	 







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