EXHIBIT 10.5
AGREEMENT AND AMENDMENT TO WARRANT TO PURCHASE
COMMON STOCK
THIS AGREEMENT AND AMENDMENT TO WARRANT TO PURCHASE COMMON STOCK (the
"Amendment") is made as of July 12, 1999 by and among At Home Corporation, a
---------
Delaware corporation ("Parent"), iMall, Inc., a Nevada corporation (the
------
"Company"), and the undersigned holder of that certain Warrant to Purchase
-------
Common Stock executing this Amendment (the "Holder").
------
R E C I T A L S
A. WHEREAS, the Company has previously issued to and Holder
-------------
currently holds that certain Warrant to Purchase Common Stock of iMall, Inc.
under which the Holder may acquire up to shares of the Company's
------------
Common Stock at a per share price of three dollars and twenty cents ($3.20)
during the period from December 19, 1997 until December 5, 2002 (the "Warrant").
-------
B. WHEREAS, in connection with the merger of the Company and a wholly-owned
subsidiary of Parent pursuant to that certain Agreement and Plan of Merger dated
as of July 12, 1999 (the "Merger Agreement") among Parent, the Company and Shop
----------------
Nevada, Inc., a Nevada corporation and a wholly-owned subsidiary of Parent (the
"Merger"), in order to induce Parent to consummate the Merger, Holder and the
------
Company have agreed to amend the Warrant and to certain other agreements
pursuant to this Amendment.
C. WHEREAS, pursuant to the Merger Agreement, at the effective time of the
Merger each Company Warrant whether or not then exercisable will be assumed by
Parent. Each Company Warrant so assumed by Parent will continue to have, and be
subject to, the same terms and conditions set forth in the applicable Company
Warrant except as amended hereby and each Company Warrant will be exercisable
(or will become exercisable in accordance with its terms) at an exercise price
and for a number of whole shares of Parent Common Stock as adjusted by the
exchange ratio.
NOW THEREFORE, in consideration of the foregoing recitals and mutual
promises set forth herein, the receipt and sufficiency of which are hereby
acknowledged, the parties do hereby agree as follows:
1. Subsections (f)(2), (f)(4), (f)(5), (f)(7) and (f)(8) of the Warrant
are each hereby terminated in their entirety and deleted from the Warrant.
2. Subsection (f)(6) of the Warrant is hereby renumbered as subsection
(f)(2) and amended in its entirely to read as follows:
(2) Whenever the Exercise Price payable upon exercise of each Warrant
is adjusted pursuant to Subsection (1) above, the number of Shares
purchasable upon exercise of this Warrant shall simultaneously be
adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the product
so obtained by the Exercise Price, as adjusted.
3. Subsection (f)(9) of the Warrant is hereby renumbered as subsection
(f)(3) and the first sentence of such subsection is amended in its entirely to
read as follows:
(3) No adjustment in the Exercise Price shall be required unless such
adjustment would require an increase or decrease of at least five
cents ($0.05) in such price; provided, however, that any adjustments
which by reason of this Subsection (3) are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations under this
Section (f) shall be made to the nearest cent or to the nearest one-
hundredth of a share, as the case may be. Anything in this Section
(f) to the contrary notwithstanding, the Company shall be entitled,
but shall not be required, to make such changes in the Exercise Price,
in addition to those required by this Section (f), as it shall
determine, in its sole discretion, to be advisable in order that any
dividend or distribution in shares of Common Stock, or any
subdivision, reclassification or combination of Common Stock hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities convertible
into Common Stock (including Warrants).
4. Subsection (f)(10) of the Warrant is hereby renumbered as subsection
(f)(4) and amended in its entirety to read as follows:
(4) Whenever the Exercise Price is adjusted, as herein provided, the
Company shall promptly but no later than 10 days after any request for
such an adjustment by the Holder, cause a notice setting forth the
adjusted Exercise Price and adjusted number of Shares issuable upon
exercise of each Warrant, and, if requested, information describing
the transactions giving rise to such adjustments, to be mailed to the
Holders at their last addresses appearing in the Warrant Register, and
shall cause a certified copy thereof to be mailed to its transfer
agent, if any. The Company may retain a firm of independent certified
public accountants selected by the Board of Directors (who may be the
regular accountants employed by the Company) to make any computation
required by this Section (f), and a certificate signed by such firm
shall be conclusive evidence of the correctness of such adjustment.
2
5. Subsection (f)(11) of the Warrant is hereby renumbered as subsection
(f)(5) and amended in its entirety to read as follows:
(5) In the event that at any time, as a result of an adjustment made
pursuant to Subsection (1) above, the Holder of this Warrant
thereafter shall become entitled to receive any shares of the Company,
other than Common Stock, thereafter the number of such other shares so
receivable upon exercise of this Warrant 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 Common
Stock contained in Subsection (1) above.
6. Subsection (f)(12) of the Warrant is hereby renumbered as subsection
(f)(6).
7. Section (k)(2) of the Warrant is hereby terminated in its entirety and
deleted from the Warrant.
8. Agreement Regarding Registration Rights. Parent agrees (i) to file
---------------------------------------
with the Securities and Exchange Commission a registration statement on Form S-3
within 30 days of the effective time of the Merger (subject to the normal
blackout policies of Parent; provided that Parent will cause the registration
statement to be filed as quickly as practicable thereafter); (ii) to use all
commercially reasonable efforts to cause the registration statement to be
declared effective as soon as possible; (iii) to promptly deliver prospectuses
relating to such registration statement to Holder upon the request of Holder;
and (iv) to maintain the effectiveness of such registration statement for one
year after the effective time of the Merger (subject to customary blackouts). In
consideration of the foregoing, the undersigned Holder of the Warrant on behalf
of such Holder and all assignees and transferees of the Warrant (the "Warrant
-------
Holder"), hereby waives, following the effective time of the Merger, all rights
------
to require that the Company or any successor thereof register the Warrant or any
Warrant Shares or to otherwise participate in a registration of the Warrant or
any Warrant Shares pursuant to subsection (j)(2) of the Warrant, and hereby
agrees not to provide the Company or any successor thereof with notice pursuant
to subsection (j)(2) of the Warrant.
9. Conditioned Effectiveness. Notwithstanding anything to the contrary
-------------------------
herein, the effectiveness of this Amendment is expressly conditioned
upon the effectiveness of the Merger of Parent and the Company.
Except as expressly amended hereunder, each term, condition and provision
of the Warrant shall remain in full force and effect.
3
IN WITNESS WHEREOF, the undersigned parties have executed this Amendment to
the Warrant as of the date first written above.
THE COMPANY PARENT
iMall, Inc. At Home Corporation
By: By:
-------------------------- --------------------------
Name: Name:
------------------------ ------------------------
Title: Title:
------------------------ -----------------------
HOLDER
By:
--------------------------
Name:
------------------------
Title:
-----------------------
4
