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 APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS RELATING TO SUCH SECURITIES
OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO EDUCATIONAL VIDEO
CONFERENCING, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.
COMMON STOCK PURCHASE WARRANT
, 1997
EDUCATIONAL VIDEO CONFERENCING, INC., a corporation organized under the
laws of the State of Delaware (the "Company"), hereby certifies that, for value
received, _______________________, or registered assigns (the "Holder"), is
entitled, subject to the terms set forth below, to purchase from the Company at
any time before 5:00 p.m., New York City time, on ______________, 2002 (the
"Expiration Date"), ____________ fully paid and nonassessable shares of Warrant
Stock (as hereinafter defined), $.0001 par value per share, of the Company, at a
purchase price of $2.00 per share (such purchase price per share as adjusted
from time to time as herein provided is referred to herein as the "Purchase
Price"). The number and character of such shares of Warrant Stock and the
Purchase Price 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 Educational Video
Conferencing, Inc. and any corporation which shall succeed or assume
the obligations of such company hereunder.
(b) The term "Common Stock" includes (i) the Company's Common
Stock, $.0001 par value per share, as authorized on the date of the
Agreement, and (ii) any other securities into which or for which any of
the securities described in (i) 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 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 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 3
or otherwise.
(d) The term "Warrant Stock" means the shares of Common Stock
and Other Securities owned or to be owned upon exercise of this
Warrant, and all other warrants in substantially the same form as this
Warrant (this Warrant and such other warrants being
collectively, the "Warrants") referred to in that certain Confidential
Offering Memorandum dated September 4, 1997 and the Subscription
Agreement between the Company and the Holder to whom this Warrant was
originally issued (the "Agreement"). This Warrant is entitled to the
benefits of, and is subject to, the obligations imposed by the
Agreement, including with respect to the registration for resale to the
public of the Common Stock issuable upon exercise of this Warrant.
1. Exercise.
1.1. Preconditions to Exercise. Before this Warrant can be
exercised the following shall occur:
(a) Subject to Section 1.1(c), the Holder shall notify the
Company in writing that the Holder is considering exercising this Warrant. As
soon as practicable after receiving such notice, the Company shall advise the
Holder of the investor suitability requirements, if any, that must be satisfied
by the Holder as a condition of such exercise.
(b) If the Holder satisfies the Company regarding the Holder's
suitability to exercise this Warrant, the Company will, subject to Section
1.1(c), provide the Holder with such information regarding the Company and an
investment in the Warrant Stock as the Company can obtain without unreasonable
effort or expense (the "Warrant Exercise Materials"), in order to permit the
Holder to determine whether to purchase Warrant Stock upon exercise of this
Warrant.
(c) The Company may, at any time, in its sole discretion,
decide to provide all holders of the Warrants with the Warrant Exercise
Materials. Subject to satisfying investor suitability requirements, the Warrants
will be exercisable for 30 days (or such longer period as the Company permits)
after delivery of the Warrant Exercise Materials to the holders of the Warrants.
The Company shall be deemed to have satisfied the requirements of Section
1.1(b), if it has complied with this Section 1.1(c) within six months prior to
receiving a notice from the Holder pursuant to Section 1.1(a).
1.2. Full Exercise. This Warrant may be exercised in full only
by the Holder by surrender of this Warrant, with the form of subscription
agreement required by the Company, duly completed and executed by the Holder, to
the Company at its principal office or at the office of its Warrant agent (as
provided in Section 6), accompanied by payment in cash or by certified or
official bank check payable to the order of the Company, in the amount obtained
by multiplying the number of shares of Warrant Stock for which this Warrant is
then exercisable by the Purchase Price then in effect.
1.3. Delivery of Stock Certificates, etc. on Exercise. The
Company agrees that the shares of Warrant 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 as aforesaid. As soon as
practicable after the exercise of this Warrant in full, and in any event within
10 business days thereafter, the Company will cause to be issued in the name of
and delivered to the Holder, or as the Holder (upon payment by such Holder of
any applicable transfer taxes) may direct, subject to compliance with applicable
securities laws, a certificate or certificates for the number of duly and
validly issued, fully paid and nonassessable shares of Warrant Stock to which
the Holder shall be entitled on such exercise, plus, in lieu of any
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fractional share to which the Holder would otherwise be entitled, cash equal to
such fraction multiplied by the then fair market value of one full share, as
determined by the Company in its sole discretion, together with any other stock
or other securities and property (including cash, where applicable) to which the
Holder is entitled upon such exercise.
2. Adjustment for Reorganization, Consolidation, Merger, etc.
2.1. 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, 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 Warrant Stock
issuable on such exercise prior to such consummation or such effective date, the
stock and other securities and property (including cash) to which the Holder
would have been entitled upon such consummation or in connection with such
dissolution, as the case may be, if the Holder had so exercised this Warrant,
immediately prior thereto, all subject to further adjustment thereafter as
provided in Section 3.
2.2. Dissolution. In the event of any dissolution of the
Company following the transfer of all or substantially all of its properties or
assets in a transaction contemplated by Section 2.1(c), the Company,
simultaneously with such dissolution, shall distribute or cause to be
distributed to the Holder the stock and other securities and property (including
cash, were applicable) which would be receivable by the Holder if the Holder had
exercised this Warrant in full immediately prior to such dissolution, less an
amount of stock, other securities, property and cash with a value equal to the
Purchase Price.
2.3. Continuation of Terms. Upon any reorganization,
consolidation, merger or transfer referred to in this Section 2, 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, as the case may be, and shall be binding upon the
issuer 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.
3. Extraordinary Events Regarding Warrant Stock. In the event
that the Company shall (a) issue additional shares of the Warrant Stock as a
dividend or other distribution on outstanding Warrant Stock, (b) subdivide its
outstanding shares of Warrant Stock, or (c) combine its outstanding shares of
the Warrant Stock into a smaller number of shares of the Warrant Stock, then, in
each such event, the Purchase Price shall, simultaneously with the happening of
such event, be adjusted by multiplying the then Purchase Price by a fraction,
the numerator of which shall be the number of shares of Warrant Stock
outstanding immediately prior to such event and the denominator of which shall
be the number of shares of Warrant Stock outstanding immediately after such
event, and the product so obtained shall thereafter be the Purchase Price then
in effect. The Purchase 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 3. The number of shares of Warrant Stock that the Holder shall
thereafter, on the exercise hereof as provided
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in Section 1, be entitled to receive shall be increased to a number determined
by multiplying the number of shares of Warrant Stock that would otherwise (but
for the provisions of this Section 3) be issuable on such exercise by a fraction
of which (a) the numerator is the Purchase Price that would otherwise (but for
the provisions of this Section 3) be in effect, and (b) the denominator is the
Purchase Price in effect on the date of such exercise.
4. 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 this Warrant, all shares of Warrant Stock from
time to time issuable on the exercise of this Warrant.
5. 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 will
execute and deliver, in lieu thereof, a new Warrant of like tenor.
6. Warrant Agent. The Company may, by written notice to each
holder of the Warrant, appoint an agent having an office in New York, NY for the
purpose of issuing Warrant Stock (or Other Securities) on the exercise of this
Warrant or for exchanging or replacing this Warrant, or any of the foregoing,
and, thereafter, any such issuance, exchange or replacement, as the case may be,
shall be made at such office by such agent.
7. 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.
8. Notices, etc. All notices and other communications from the
Company to the Holder or the Holder to the Company shall be delivered by hand
(which shall include overnight delivery by Federal Express or similar service)
or mailed by first class registered or certified mail, postage prepaid, to the
Company at its principal office and to the Holder at such address as may have
been furnished to the Company in writing by the Holder or, until the 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. Notices
shall be deemed given upon receipt, when delivered by hand, and 48 hours after
mailing, when mailed.
9. 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 construed and enforced in
accordance with and governed by the laws of New York. 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.
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IN WITNESS WHEREOF, the Company has executed this Warrant as of the
date first written above.
EDUCATIONAL VIDEO CONFERENCING, INC.
By:
---------------------------------
Title:
------------------------------
Attest:
By:
---------------------------------
Title:
------------------------------
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Exhibit A
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 Warrant Stock of Educational Video Conferencing, Inc. to 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 Educational Video Conferencing, Inc. with full power of substitution in the
premises.
================================================================================
Transferees Percentage Transferred Number
Transferred
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
================================================================================
Dated: ___________________, 19__ ________________________________
(Signature must conform to name
of Holder as specified on the
Signed in the presence of: face of the warrant)
________________________________ ________________________________
(Name) (Address)
ACCEPTED AND AGREED:
[TRANSFEREE]
________________________________
(Address)
________________________________ ________________________________
(Name) (Address Cont.)
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