EXHIBIT 10.1
ASI SOLUTIONS INCORPORATED,
X.X. XXXXXXXXXX & CO., INC.
AND
XXXXXX XXXXXXXXXX XXXXX INC.
WARRANT AGREEMENT
DATED AS OF _______, 1997
WARRANT AGREEMENT
WARRANT AGREEMENT dated as of __________, 1997 by and among ASI SOLUTIONS
INCORPORATED, a Delaware corporation (the "Company"), X.X. XXXXXXXXXX & CO.,
INC. ("Xxxxxxxxxx") and XXXXXX XXXXXXXXXX XXXXX INC. ("Janney" and, together
with Xxxxxxxxxx, the "Representatives").
WHEREAS, the Company and the Representatives have entered into an
Underwriting Agreement of even date herewith (the "Underwriting Agreement"); and
WHEREAS, the Company proposes to issue to the Representatives warrants as
hereinafter described (the "Warrants") to purchase up to an aggregate of 220,000
shares, subject to adjustment as hereinafter provided (the "Shares"), of the
Company's common stock, par value $.0l per share (the "Common Stock").
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth and for other good and valuable consideration, the parties
hereto agree as follows:
1. Issuance of Warrants; Form of Warrant. As more fully set forth below,
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the Company will issue, sell and deliver the Warrants to the Representatives or
their bona fide officers or partners, as named by the Representatives in
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accordance with Section 6(p) of the Underwriting Agreement, for an aggregate
price of $220, concurrently with the closing (the "Closing") under the
Underwriting Agreement relating to the public offering, pursuant to a
registration statement on Form S-1 (File No. 33-_____) (the "Registration
Statement"), of 2,200,000 shares of Common Stock (plus an option to purchase up
to an additional 330,000 shares of Common Stock to cover over-allotments) (the
"Offering"). Specifically, at the Closing, the Company will issue, sell and
deliver (a) _______ of the Warrants to Xxxxxxxxxx or its bona fide officers or
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partners for an aggregate price of $____ and (b) _______ of the Warrants to
Janney or its bona fide officers or partners for an aggregate price of $_____.
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The form of the Warrants shall be substantially as set forth on Exhibit A
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attached hereto. The Warrants shall be executed on behalf of the Company by the
manual or facsimile signature of the present or any future Chairman of the
Board, President or Vice President of the Company, under its corporate seal,
affixed or in facsimile, attested by the manual or facsimile signature of the
present or any future Secretary or Assistant Secretary of the Company.
2. The Warrants shall be numbered and shall be registered in a Warrant
register as they are issued. The Company shall be entitled to treat the
registered holder of any Warrant on the Warrant register (the "Warrant Holder")
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, and shall not be liable for any registration of
transfer of Warrants which are registered or are to be registered in the name of
or at the direction of a fiduciary or the nominee of a fiduciary unless made
with the actual knowledge that a fiduciary or nominee is committing a breach of
trust in requesting such registration of transfer, or with
such knowledge of such facts that its participation therein amounts to bad
faith. The Warrants shall be registered initially in the name of "X.X.
Xxxxxxxxxx & Co., Inc." and "Xxxxxx Xxxxxxxxxx Xxxxx Inc.", as the case may be,
in such denominations as Xxxxxxxxxx and Janney may request in writing to the
Company; provided however, that prior to the Closing, Xxxxxxxxxx and/or Janney
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may designate that their respective Warrants be issued in varying amounts
directly to their respective bona fide officers or partners and not to each of
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them directly in accordance with Section 6(p) of the Underwriting Agreement.
Such designation will only be made by Xxxxxxxxxx and/or Janney if they determine
such issuances would not violate the rules and interpretations of the Board of
Governors of the National Association of Securities Dealers, Inc. (the "NASD")
relating to the review of corporate financing arrangements, and subject to
applicable federal and state securities law.
3. Transfer of Warrants. The Warrants may not be transferred, assigned,
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pledged, hypothecated, sold, made subject to a security interest, or otherwise
transferred, in part or in whole, prior to the first anniversary of the
effective date of the Registration Statement (the "Effective Date"), except to
the bona fide officers or partners of the Representatives, and subject to
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applicable federal and state securities law, and only on the books of the
Company upon delivery thereof duly endorsed by the Warrant Holder or by his duly
authorized attorney or representative, or accompanied by proper evidence of
succession, assignment or authority to transfer. In all cases of transfer by an
attorney, the original power of attorney, duly approved, or an official copy
thereof, duly certified, shall be deposited with the Company. 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 with the Company in its discretion. Upon any
registration of transfer, the Company shall deliver a new Warrant or new
Warrants to the persons entitled thereto. A Warrant may be exchanged at the
option of the Warrant Holder thereof for another Warrant, or other Warrants, of
different denominations, of like tenor and representing in the aggregate the
right to purchase a like number of shares of Common Stock upon surrender to the
Company or its duly authorized agent. Notwithstanding the foregoing, the
Company shall have no obligation to cause a Warrant to be transferred on its
books to any person unless the Warrant Holder thereof shall furnish to the
Company evidence of compliance with the Securities Act of 1933, as amended (the
"Act"), and applicable state securities law, in accordance with the provisions
of Section 10 of this Agreement.
4. Term of Warrants; Exercise of Warrants. Each Warrant entitles the
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Warrant Holder thereof to purchase one Share at a purchase price of $____ per
Share [TO BE EQUAL TO 150% OF THE INITIAL PUBLIC OFFERING PRICE] (the "Exercise
Price") at any time from the first anniversary of the Effective Date (except as
otherwise set forth herein) until 5:00 p.m., Boston time (the "Close of
Business"), on the day immediately preceding the fifth anniversary of the
Effective Date (the "Expiration Date"). The Exercise Price and the number of
Shares issuable upon exercise of each Warrant are subject to adjustment upon the
occurrence of certain events, pursuant to the provisions of Section 8 of this
Agreement. Subject to the provisions of this Agreement, each Warrant Holder
shall have the right, which may be exercised as set forth in
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such Warrant, to purchase from the Company (and the Company shall issue and sell
to such Warrant Holder) the number of fully paid and nonassessable Shares
specified in such Warrant Holder's Warrant, upon surrender to the Company, or
its duly authorized agent, of such Warrant, with an election to purchase
attached thereto in the form of Exhibit B to this Agreement duly completed and
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signed, with (if requested by the Company within two business days of surrender
of the Warrant with the election to purchase) signatures guaranteed by a member
firm of a national securities exchange, a commercial bank (not a savings bank or
savings and loan association) or trust company located in the United States or a
member of the NASD, and upon payment to the Company of the Exercise Price, as
adjusted in accordance with the provisions of Section 8 of this Agreement, for
the number of Shares in respect of which such Warrant is then exercised.
Notwithstanding the method of exercise set forth in any Warrant, in the event
that the Warrant Holder thereof has not exercised such Warrant prior to the
Close of Business on the Expiration Date and the current market price per share
of Common Stock at the Close of Business on the Expiration Date (as determined
substantially in accordance with Section 8(d), but using the closing prices or
quotations, as the case may be, on such Expiration Date rather than a 30-day
average) is greater than the Exercise Price, then the Warrant Holder thereof
shall be deemed to have exercised such Warrant in full immediately prior to the
Close of Business on the Expiration Date (an "Automatic Exercise"). Payment of
the Exercise Price may be made in cash or by check payable to the order of the
Company in the amount obtained by multiplying the number of Shares for which
such Warrant is then being exercised by the Exercise Price then in effect (such
amount, the "Exercise Payment"), except that the Warrant Holder may, at its
option, elect to pay the Exercise Payment by delivering to the Company the
number of shares of Common Stock determined by dividing the Exercise Payment by
the current market price (as defined in paragraph (d) of Section 8) of a share
of Common Stock on the date of exercise or by cancelling a portion of such
Warrant that is equal to the number of shares determined by dividing the
Exercise Payment by the current market price (as defined in paragraph (d) of
Section 8) of a share of Common Stock as of the date of exercise. In the event
of an Automatic Exercise of any Warrant, the Warrant Holder thereof shall be
deemed to have chosen to cancel the portion of its Warrant that is equal to the
number of shares determined by dividing the Exercise Payment by the current
market price (as defined in paragraph (d) of Section 8) of a share of Common
Stock as of the Close of Business on the Expiration Date. Except as set forth
in Section 8, no adjustment shall be made for any dividends on any Shares
issuable upon exercise of a Warrant. Upon each surrender of Warrants and payment
of the Exercise Payment as aforesaid, or upon the occurrence of an Automatic
Exercise, the Company shall issue and cause to be delivered with all reasonable
dispatch (but in any event within three (3) business days) to or upon the
written order of the Warrant Holder and (subject to receipt of evidence of
compliance with the Act and applicable state securities laws in accordance with
the provisions of Section 10 of this Agreement) in such name or names as such
Warrant Holder may designate, a certificate or certificates for the number of
full Shares so purchased upon the exercise of such Warrant, together with cash,
as provided in Section 9 of this Agreement, in respect of any fractional Shares
otherwise issuable upon such surrender. 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
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become a holder of record of such Shares, as of the date of the surrender of
such Warrant and payment of the Exercise Payment as aforesaid,
or as of the date of the Automatic Exercise; provided, however, that if, at the
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date of surrender of such Warrant and payment of such Exercise Payment, the
transfer books for the Common Stock or other class of stock purchasable upon the
exercise of such Warrant shall be closed, the certificates for the Shares shall
be issuable as of the date on which such books shall next be opened (whether
before, on or after the Expiration Date), and until such date the Company shall
be under no duty to deliver any certificate for such Shares; provided further,
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however, that the transfer books of record, unless otherwise required by law,
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shall not be closed at any one time for a period longer than four (4) days. The
rights of purchase represented by a Warrant shall be exercisable, at the
election of the Warrant Holder thereof, either in full or from time to time in
part and, in the event that any Warrant is exercised in respect of less than all
of the Shares purchasable on such exercise at any time prior to the Expiration
Date, a new Warrant or new Warrants will be issued for the remaining number of
Shares specified in the Warrant or Warrants so surrendered.
5. Payment of Taxes. The Company will pay all documentary stamp taxes, if
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any, attributable to the issuance of Shares upon the exercise of a Warrant;
provided, however, that the Company shall not be required to pay any tax or
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taxes which may be payable in respect of any transfer involved in the issuance
or delivery of any certificates for Shares in a name other than that of the
Warrant Holder who exercised the Warrant in respect of which such Shares are
issued.
6. Mutilated or Missing Warrants. In case any Warrant shall be mutilated,
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lost, stolen or destroyed, the Company shall issue and deliver in exchange and
substitution for and upon cancellation of the mutilated Warrant, or in lieu of
and substitution for the Warrant lost, stolen or destroyed, a new Warrant of
like tenor and representing an equivalent right or interest, but only upon
receipt of evidence reasonably satisfactory to the Company of such loss, theft
or destruction of such Warrant or an indemnity, also reasonably satisfactory to
the Company.
7. Reservation of Shares, etc. There have been reserved, and the Company
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shall at all times keep reserved, out of the authorized and unissued Common
Stock, an aggregate number of shares of Common Stock sufficient to provide for
the exercise of the rights of purchase represented by the outstanding Warrants.
In addition, upon any adjustment to the number and kind of securities
purchasable upon exercise of the Warrants, the Company shall reserve, and shall
at all times thereafter keep reserved, out of the authorized and unissued Common
Stock or such other kind of securities, an aggregate number of shares of Common
Stock or shares, units or otherwise of such other kind of securities sufficient
to provide for the exercise of the rights to purchase represented by the
outstanding Warrants. After the Effective Date, the transfer agent for the
Common Stock (the "Transfer Agent"), and every subsequent Transfer Agent, if
any, for Shares issuable upon the exercise of any of the rights of purchase
represented by the Warrants, will be irrevocably authorized and directed at all
times
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until the Expiration Date to reserve such aggregate number of authorized and
unissued shares of Common Stock as shall be required for such purpose. The
Company will keep a copy of this Agreement on file with the Transfer Agent and
with every subsequent Transfer Agent for any Shares issuable upon the exercise
of the rights of purchase represented by the Warrants. The Company will supply
any such Transfer Agent with duly executed stock certificates for such purpose
and will itself provide or otherwise make available any cash which may be
distributable as provided in Section 9 of this Agreement. Any Warrant
surrendered in the exercise of the rights thereby evidenced shall be cancelled,
and until delivery to the person surrendering such Warrant of stock certificates
representing the Shares to be issued to such person as a result of such
exercise, such cancelled Warrant shall constitute sufficient evidence of the
number of Shares that have been issued upon the exercise of such Warrant. No
shares of Common Stock shall be subject to reservation in respect of any
unexercised Warrant subsequent to the Expiration Date.
8. Adjustments of Exercise Price and Number of Shares. The Exercise Price
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and the number and kind of securities purchasable upon exercise of each Warrant
shall be subject to adjustment from time to time upon the happening of certain
events, as follows:
(a) In case the Company shall (i) declare a dividend on its Common Stock in
shares of Common Stock or make a distribution in shares of Common Stock, (ii)
subdivide its outstanding shares of Common Stock into a greater number of 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
its shares of Common Stock other securities of the Company, other than any such
reclassification to which paragraph (j) of this Section 8 applies, the number of
Shares purchasable upon exercise of each Warrant immediately prior thereto shall
be adjusted so that the Warrant Holder thereof shall be entitled to receive the
kind and number of shares of Common Stock 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 issue rights, options or warrants to all
holders of its Common Stock, entitling them to subscribe for or to purchase
shares of Common Stock or securities convertible into or exchangeable for Common
Stock (other than "poison pill" rights referred to in paragraph (l) of this
Section 8) at a price per share (or having a conversion price per share) that is
lower on the record date for the determination of stockholders entitled to
receive such rights, options or warrants than the then current market price per
share of Common Stock (as defined in paragraph (d) below), the number of Shares
thereafter purchasable upon the exercise of each Warrant shall be determined by
multiplying the number of Shares theretofore purchasable upon exercise of such
Warrant by a fraction, of which the numerator shall be the number of shares of
Common Stock outstanding at the close of business
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on the record date for the determination of stockholders entitled to
receive such rights, options or warrants plus the number of additional shares of
Common Stock offered for subscription or purchase (or into which the convertible
securities so offered are initially convertible), and of which the denominator
shall be the number of shares of Common Stock outstanding at the close of
business on the record date for the determination of stockholders entitled to
receive such rights, options or warrants plus the number of shares which the
aggregate offering price of the total number of shares of Common Stock so
offered (or the aggregate initial conversion price of the convertible securities
so offered) would purchase at the then current market price per share of Common
Stock. Such adjustment shall be made whenever such rights, options or warrants
are issued, and shall become effective retroactively to the record date for the
determination of stockholders entitled to receive such rights, options or
warrants.
(c) In case the Company shall distribute to all holders of its Common Stock
shares of stock (other than Common Stock) or evidences of its indebtedness or
assets (excluding cash dividends out of retained earnings and dividends or
distributions referred to in paragraph (a) of this Section 8) or rights, options
or warrants or convertible or exchangeable securities containing the right to
subscribe for or purchase shares of Common Stock (excluding those referred to in
paragraph (b) above and paragraph (l) below), then in each case the number of
Shares thereafter purchasable upon the exercise of each Warrant shall be
determined by multiplying the number of Shares theretofore purchasable upon the
exercise of such Warrant by a fraction, of which the numerator shall be the
current market price per share of Common Stock (as defined in paragraph (d)
below) on the record date mentioned below in this paragraph (c), and of which
the denominator shall be the current market price per share of Common Stock on
such record date, 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 shares of stock or 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.
(d) For the purpose of any computation under paragraphs (b) and (c) of this
Section 8 or under Section 4 or Section 9, the current market price per share of
Common Stock at any date shall be deemed to be the average of the daily closing
prices per share for the 30 consecutive trading days commencing 45 trading days
before the date of such computation. The closing price for each day shall be the
last reported sale price regular way or, in case no such reported sale takes
place on such day, the average of the closing bid and asked prices regular way
for such day, in either case on the principal national securities exchange on
which the shares of Common Stock are listed or admitted to trading, or if the
Common Stock is not listed or admitted to trading on any national securities
exchange, but is traded in the over-the-counter market, the closing sale price
of the Common Stock or, in case no sale is publicly reported, the average of the
closing bid and asked quotations for the Common Stock on the Nasdaq National
Market System ("NASDAQ") or any comparable system, or if the
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Common Stock is not listed on NASDAQ or a comparable system, the closing
sale price of the Common Stock or, in case no sale is publicly reported, the
average of the closing bid and asked prices as furnished by two members of the
NASD selected from time to time by the Company for that purpose.
(e) No adjustment in the number of Shares purchasable upon exercise of each
Warrant shall be required unless such adjustment would require an increase or
decrease of at least one percent (1%) in the number of Shares purchasable upon
the exercise of each Warrant; provided, however, that any adjustments which by
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reason of this paragraph (e) 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.
(f) Whenever the number of Shares purchasable upon the exercise of each
Warrant is adjusted, as herein provided, the Exercise Price shall be adjusted by
multiplying such Exercise Price immediately prior to such adjustment by a
fraction, of which the numerator shall be the number of Shares purchasable upon
the exercise of each Warrant immediately prior to such adjustment, and of which
the denominator shall be the number of Shares so purchasable immediately
thereafter.
(g) For the purpose of this Section 8, 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, any Warrant Holder shall become entitled to
purchase any shares of capital stock 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 Exercise Price thereof 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 Shares contained in this Section 8, and
the provisions of Sections 4, 5, 7, 9 and 12, with respect to the Shares, shall
apply on like terms to any such other shares.
(h) The Company may, at its option, at any time during the term of a
Warrant, reduce, either temporarily or permanently, the then current Exercise
Price to any amount deemed appropriate by the Board of Directors of the Company;
provided, however, that any such reduction may be temporary only to the extent
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that Warrant Holders receive written notice from the Company stating the term of
such temporary reduction; and further provided, that following the expiration of
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such temporary reduction, the Exercise Price may not be raised to an amount in
excess of the Exercise Price in effect immediately prior to such temporary
reduction.
(i) Whenever the number of Shares purchasable upon the exercise of each
Warrant or the Exercise Price of such Shares is adjusted, as herein provided,
the Company
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shall promptly mail by first class mail, postage prepaid, to each Warrant Holder
notice of such adjustment or adjustments. The Company may retain a firm of
independent public accountants (who may be the regular accountants employed by
the Company) to make any computation required by this Section 8 and shall cause
such accountants to prepare a certificate setting forth the number of Shares
purchasable upon the exercise of each Warrant and the Exercise Price thereof
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 evidence of the correctness of such
adjustment, and each Warrant Holder shall have the right to inspect such
certificate during reasonable business hours.
(j) In case of any consolidation of the Company with or merger of the
Company with and into another corporation or other entity or any consolidation
with or merger of any other corporation or other entity with and into the
Company (other than a merger which does not result in a reclassification,
conversion, exchange or cancellation of Shares and in which the Company is the
surviving corporation) or in case of any sale or conveyance to another
corporation or other person or entity of the property of the Company as an
entirety or substantially as an entirety, (i) notwithstanding the provisions of
Section 4 hereof, each Warrant Holder shall have the right to exercise any
Warrant then held immediately prior to such consolidation, merger, sale or
conveyance upon payment of the Exercise Price then in effect and (ii) with
respect to any Warrants which are not exercised as provided in clause (i) above,
the Company or such successor or purchasing corporation or person or entity (or
an affiliate of such successor or purchasing corporation or person or entity),
as the case may be, agrees that each Warrant Holder shall have the right after
the happening of any such consolidation, merger, sale or conveyance (except for
a consolidation, merger, sale or conveyance in which the consideration received
by the Company's stockholders consists solely of cash) upon payment of the
Exercise 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 and the securities issued upon
such exercise been held since the date of such exercise; provided, however, that
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in the event any such transaction as described above shall be effected for a
consideration per share of Common Stock consisting only of cash in an amount
less than the Exercise Price at the time (as adjusted pursuant hereto)
multiplied by two, each Warrant Holder shall have the right to receive, as of
the effective time of such transaction and in cancellation of his Warrant, the
fair value of such Warrant as of the time immediately prior to such transaction
(without taking such transaction into account) as determined in good faith by
the Board of Directors of the Company. The provisions of this paragraph (j)
shall similarly apply to successive consolidations, mergers, sales or
conveyances.
(k) Notwithstanding any adjustment in the Exercise Price or the number or
kind of shares purchasable upon the exercise of a Warrant pursuant to this
Agreement, a certificate for a Warrant issued prior or subsequent to such
adjustment may continue to express
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the same price and number and kind of shares as are initially issuable pursuant
to this Agreement.
(l) Notwithstanding the foregoing, in the event that the Company shall
distribute "poison pill" rights pursuant to a "poison pill" stockholder rights
plan (the "Rights"), the Company shall, in lieu of making any adjustment
pursuant to Section 8(b) or Section 8(c) hereof, make proper provision so that
each Warrant Holder who exercises a Warrant after the record date for such
distribution and prior to the expiration or redemption of the Rights shall be
entitled to receive upon such exercise, in addition to the Shares issuable upon
such exercise, a number of Rights to be determined as follows: (i) if such
exercise occurs on or prior to the date for the distribution to the holders of
Rights of separate certificates evidencing such Rights (the "Distribution
Date"), the same number of Rights to which a holder of a number of shares of
Common Stock equal to the number of Shares issuable upon such exercise at the
time of such exercise in accordance with the terms and provisions of and
applicable to the Rights; and (ii) if such exercise occurs after the
Distribution Date, the same number of Rights to which a holder of the number of
Shares into which the Warrant so exercised was exercisable immediately prior to
the Distribution Date would have been entitled on the Distribution Date in
accordance with the terms and provisions of and applicable to the Rights.
9. Fractional Interests. The Company shall not be required to issue
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fractions of Shares on the exercise of a Warrant. If more than one Warrant
shall be presented for exercise in full at the same time by the same Warrant
Holder, the number of Shares which shall be issuable upon the exercise thereof
shall be computed on the basis of the aggregate number of Shares purchasable on
exercise of the Warrants so presented. If any fraction of a Share would, except
for the provisions of this Section 9, be issuable on the exercise of any Warrant
(or specified portions thereof), the Company shall purchase such fraction from
the Warrant Holder for an amount in cash equal to the same fraction of the
current market price per share of Common Stock (determined as provided in
paragraph (d) of Section 8) on the date of exercise.
10. Restrictions on Disposition. The issuance of the Warrants has been
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registered under the Act pursuant to the Registration Statement. The
Representatives represent and warrant to the Company that they understand that
neither the Warrants nor the Shares may be transferred except pursuant to (i) an
effective registration statement under the Act or (ii) any available rule or
exemption from registration under the Act permitting such disposition.
11. Certificates to Bear Legends. Each Warrant shall be subject to a
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stop-transfer order and the certificate or certificates therefor shall bear the
following legend:
THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
SECURITIES LAWS AND NEITHER THE WARRANTS REPRESENTED BY THIS
CERTIFICATE NOR
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THE SECURITIES ISSUABLE UPON EXERCISE HEREOF MAY BE
OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR (ii) ANY AVAILABLE RULE OR EXEMPTION FROM
REGISTRATION UNDER SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES.
The Shares or other securities issued upon exercise of a Warrant shall be
subject to a stop-transfer order and the certificate or certificates evidencing
any such Shares or securities shall bear a legend in substantially the following
form:
THE SHARES OR SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR ANY STATE SECURITIES LAWS AND THE SHARES OR OTHER SECURITIES
REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, OR
(ii) ANY AVAILABLE RULE OR EXEMPTION FROM REGISTRATION UNDER SUCH ACT
RELATING TO THE DISPOSITION OF SECURITIES.
12. Registration Rights.
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(a) Demand Registration Rights. The Company covenants and agrees with
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the Representatives and any other or subsequent Warrant Holder(s) or registered
holder(s) of Shares or registered holder(s) of other securities for which the
Warrants become exercisable (for purposes of this Section 12, collectively, the
"Warrant Holders" and each a "Warrant Holder") that, upon written request (a
"Registration Request") of the then Warrant Holder(s) of at least a majority of
the securities issued and issuable pursuant to the Warrants, made at any time
within the period commencing on the first anniversary of the Effective Date and
ending at the Close of Business on the Expiration Date, the Company will file
with all deliberate speed and, in any event, within 45 days after receipt of
such Registration Request, at its sole expense, no more than once, and at the
Warrant Holders' expense, no more than once, a registration statement or a
Regulation A offering statement (as requested by the Warrant Holders and if
permitted under the Securities Act) registering or qualifying the Shares or
other securities for which the Warrants become exercisable for sale. Within 15
days after receiving any such notice, the Company shall give notice to the other
Warrant Holders advising that the Company is proceeding with such registration
statement or Regulation A offering statement and offering to include therein the
Shares or other securities for which the Warrants become exercisable of such
Warrant Holders. The Company shall not be obligated to any such other Warrant
Holder unless such other Warrant Holder shall accept such offer by notice in
writing
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to the Company within 10 days after receipt of such notice from the
Company. No other securities of the Company shall be entitled to participate in
such registration or qualification. The Company will use its best efforts,
through its officers, directors, auditors and counsel in all matters necessary
or advisable, to file and cause to become effective such registration statement
or Regulation A offering statement (if permitted under the Securities Act) as
promptly as practicable and for a period of two years thereafter to reflect in
the registration statement or Regulation A offering statement (if permitted
under the Securities Act) financial statements which are prepared in accordance
with Section 10(a)(3) of the Securities Act and any facts or events arising
that, individually or in the aggregate, represent a fundamental or material
change in the information set forth in the registration statement or Regulation
A offering statement to enable any Warrant Holder to exercise Warrants and to
sell Shares or other securities for which the Warrants become exercisable,
during such two-year period. If any registration pursuant to this paragraph (a)
is an underwritten offering, the Company will select an underwriter (or managing
underwriter if such offering should be syndicated) approved by the Warrant
Holders of a majority of the Warrants or Shares or other securities for which
the Warrants become exercisable to be included in such registration.
Notwithstanding the foregoing, the Company may postpone the filing of such
registration statement or offering statement for a reasonable period of time
after receipt of the original written Registration Request (not exceeding 90
days) if, in the good faith opinion of the Company's Board of Directors,
effecting the registration would adversely affect a material or other comparable
transaction or would require the Company to make public disclosure of
information the public disclosure of which would have a material adverse effect
upon the Company.
(b) Piggyback Registration Rights. The Company covenants and agrees
-----------------------------
with the Representatives and any other or subsequent Warrant Holder(s) that if,
at any time within the period commencing on the first anniversary of the
Effective Date and ending at the Close of Business on the day immediately
preceding the seventh anniversary of the Effective Date, it proposes to register
any class of security under the Act in a primary registration on behalf of the
Company or in a secondary registration on behalf of holders of such securities
and the registration form to be used may be used for registration of the Shares
or other securities for which the Warrants become exercisable, the Company will
give prompt written notice (which, in the case of a registration pursuant to the
exercise of demand registration rights other than those provided in Section
12(a) of this Agreement, shall be within 10 business days after the Company's
receipt of notice of such exercise and, in any event, shall be at least 45 days
prior to such filing) to each Warrant Holder (regardless of whether the Warrant
Holder shall have theretofore availed himself or herself of the right provided
in Section 12(a)) at the addresses appearing on the records of the Company of
its intention to effect a registration. The Company will offer to include in
such registration such number of Shares or other securities for which the
Warrants are exercisable with respect to which the Company has received written
requests for inclusion therein within 10 days after receipt of notice from the
Company; provided, that if such registration is to be underwritten, the
--------
Company shall not be required to include the Shares or other securities for
which the Warrants become exercisable in such
11
registration to the extent the managing underwriter(s) determines in
good faith that such inclusion would materially adversely affect the offering
being made by such registration. All registrations requested pursuant to this
Section 12(b) are referred to herein as "Piggyback Registrations." This
paragraph is not applicable to a registration statement filed by the Company on
Forms S-4 or S-8 or any successor forms.
(c) Action to be Taken by the Company. In connection with the
---------------------------------
registration of the Shares or other securities for which the Warrants become
exercisable in accordance with paragraphs (a) or (b) above, the Company agrees
to:
(i) bear the expense of any registration or qualification
under paragraph (a), on one occasion, or under paragraph (b), on any number
of occasions, including but not limited to legal, accounting and printing
fees; provided, however, that in no event shall the Company be
-------- -------
obligated to pay (A) any fees and disbursements of any counsel for the
Warrant Holder(s), or (B) any underwriters' discount or commission in
respect to such Shares or other securities for which the Warrants become
exercisable, payment of which shall, in each case, be the sole
responsibility of the respective Warrant Holder(s) thereof;
(ii) use its best efforts to register or qualify the Shares or
other securities for which the Warrants become exercisable for offer or sale
under state securities or blue sky laws of such jurisdictions as the Warrant
Holders shall reasonably request and do any and all other acts and things
which may be necessary or advisable to enable the Warrant Holders to
consummate the proposed sale, transfer or other disposition of such
securities in any jurisdiction;
(iii) furnish to each holder copies of any registration
statement for the Shares or other securities for which the Warrants become
exercisable, any prospectus included in any such registration statement and
all amendments and supplements to such documents, in each case as soon as
available and in such quantities as such Warrant Holder may from time to
time reasonably request; and
(iv) if registration is to be pursuant to an underwritten
offering, enter into a cross-indemnity agreement in customary form, with
each underwriter, if any, and each Warrant Holder of securities included in
such registration statement.
13. Notices to Warrant Holders; Dissolution; Exercise Rights.
--------------------------------------------------------
(a) Nothing contained in this Agreement or in any Warrant shall be
construed as conferring upon any Warrant Holder the right to vote or to receive
dividends or to consent or to receive notice as a stockholder in respect of the
meetings of stockholders or the election of directors of the Company or any
other matter, or any rights whatsoever as a stockholder of the Company;
provided, however, that in the event that a meeting of
-------- -------
12
stockholders shall be called to consider and take action on a proposal for the
voluntary dissolution of the Company or a consolidation, merger or sale of all
or substantially all of its property, assets, business and goodwill as an
entirety, then, in that event, the Company shall cause a notice thereof to be
sent by first-class mail, postage prepaid, at least 20 business days prior to
the date fixed as a record date or the date of closing the transfer books in
relation to such meeting, to each Warrant Holder at such Warrant Holder's
address appearing on the Warrant register. If such notice shall have been so
given and if such a voluntary dissolution shall be authorized at such meeting or
any adjournment thereof, then (i) notwithstanding the provisions of Section 4
hereof, each Warrant Holder shall have the right, at the election of the Warrant
Holder, (A) to exercise any Warrant then held immediately prior to such
voluntary dissolution upon payment of the Exercise Price then in effect or (B)
to receive, as of the effective date of the dissolution, the fair value of such
Warrant as of the time immediately prior to the authorization of the dissolution
(without taking the dissolution into account) as determined by the Board of
Directors of the Company and (ii) from and after the date on which such
voluntary dissolution shall have been duly authorized by the stockholders, the
purchase rights represented by such Warrant and all other rights with respect
thereto shall cease and terminate.
(b) In the event the Company intends to make any distribution on its
Common Stock (or other securities which may be purchasable in lieu thereof upon
the exercise of a Warrant), including, without limitation, any such distribution
to be made in connection with a consolidation or merger in which the Company is
the continuing corporation, or to issue subscription rights or warrants to
holders of its Common Stock, the Company shall cause a notice of its intention
to make such distribution to be sent by first-class mail, postage prepaid, at
least 10 business days prior to the date fixed as a record date or the date of
closing the transfer books in relation to such distribution, to each registered
Warrant Holder at such Warrant Holder's address appearing on the Warrant
register.
14. Notices. Any notice pursuant to this Agreement to be given or made by
-------
any Warrant Holder to the Company shall be sufficiently given or made as of the
third business day following mailing if sent by first-class mail, postage
prepaid, or as of the day after mailing if sent by a nationally recognized
overnight courier, addressed as follows (or to such other address as the Company
may designate by notice given in accordance with this Section 14 to the Warrant
Holder(s)):
ASI Solutions Incorporated
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: President
Notices or demands authorized by this Agreement to be given or made by the
Company to any Warrant Holder shall be sufficiently given or made (except as
otherwise provided in this Agreement) as of the third business day following
mailing if sent by first-class mail, postage
13
prepaid, or as of the day after mailing if sent by a nationally recognized
overnight courier, addressed to such Warrant Holder at the address of such
Warrant Holder as shown on the Warrant register, Common Stock register or the
register for such other security for which the Warrants become exercisable.
15. Covenant as to Certain Transactions. The Company shall not consummate
-----------------------------------
any consolidation, merger, sale or conveyance (as described in Section 8(j)
hereof) unless prior thereto (a) the successor or purchasing corporation (or an
affiliate of such successor or purchasing corporation), as the case may be,
shall have a sufficient aggregate number of authorized shares and other
securities which have not been issued or reserved for issuance to permit the
exercise in full of the Warrants in accordance with Section 8(j) hereof and (b)
the Company and such successor or purchasing corporation or affiliate shall have
executed and delivered to each Warrant Holder a supplemental agreement
confirming that the requirements of Section 8(j) hereof shall be promptly
performed in accordance with their terms and that such consolidation, merger,
sale or conveyance shall not result in a default by the Company, such successor
or purchasing corporation or such affiliate under this Agreement (as the same
shall have been assumed by such successor or purchasing corporation or such
affiliate) and further providing that such successor or purchasing corporation
or such affiliate shall assume all obligations of the Company hereunder and
agree to be bound hereby. In the event of and after the happening of any such
consolidation, merger, sale or conveyance, the term "the Company," as used
herein, shall be deemed to refer to such successor or purchasing corporation or
such affiliate, as the case may be.
16. Governing Law. This Agreement and each Warrant issued hereunder shall
-------------
be governed by and construed in accordance with the substantive laws of the
State of Delaware without giving effect to the principles of conflicts of law
thereof.
17. Counterparts. The Agreement may be executed in any number of
------------
counterparts, each of which so executed shall be deemed to be an original; but
such counterparts together shall constitute one and the same instrument.
14
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day, month and year first above written.
ASI SOLUTIONS INCORPORATED
By:_______________________________________
Name:
Title:
X.X. XXXXXXXXXX & CO., INC.
By:_______________________________________
Name:
Title:
XXXXXX XXXXXXXXXX XXXXX INC.
By:_______________________________________
Name:
Title:
15
EXHIBIT A
---------
(Form of Warrant Certificate)
THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
SECURITIES LAWS AND NEITHER THE WARRANTS REPRESENTED BY THIS CERTIFICATE NOR THE
SECURITIES ISSUABLE UPON EXERCISE HEREOF MAY BE OFFERED OR SOLD EXCEPT PURSUANT
TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, OR (ii) ANY AVAILABLE
RULE OR EXEMPTION FROM REGISTRATION UNDER SUCH ACT RELATING TO THE DISPOSITION
OF SECURITIES.
No._________ ______ Warrants
VOID AFTER 5:00 P.M. BOSTON TIME
ON _____________, 2002
ASI SOLUTIONS INCORPORATED
Warrant Certificate
THIS CERTIFIES THAT, for value received, _________________, or registered
assigns, is the owner of the number of Warrants set forth above, each of which
entitles the owner thereof to purchase at any time from _______________, 1998
(except as otherwise set forth in the Warrant Agreement referred to below),
until 5:00 p.m., Boston time on __________, 2002 (the "Expiration Date"), one
fully paid and nonassessable share of the common stock, par value $.0l per share
(the "Common Stock"), of ASI SOLUTIONS INCORPORATED, a Delaware corporation (the
"Company"), at the purchase price of $_________ per share (the "Exercise
Price"), upon presentation and surrender of this Warrant Certificate with the
Form of Election to Purchase duly executed. The number of Warrants evidenced by
this Warrant Certificate (and the number of shares of Common Stock which may be
purchased upon exercise hereof) set forth above, and the Exercise Price per
share set forth above, are the number and Exercise Price as of the date of
original issuance of the Warrants, based on the shares of Common Stock of the
Company as constituted at such date. As provided in the Warrant Agreement
referred to below, the Exercise Price and the number or kind of securities which
may be purchased upon the exercise of the Warrants evidenced by this Warrant
Certificate are, upon the happening of certain events, subject to modification
and adjustment.
16
This Warrant Certificate is subject to, and entitled to the benefits of,
all of the terms, provisions and conditions of an agreement dated as of
__________, 1997 (the "Warrant Agreement") by and among the Company, X.X.
Xxxxxxxxxx & Co., Inc. and Xxxxxx Xxxxxxxxxx Xxxxx Inc., which Warrant Agreement
is hereby incorporated herein by reference and made a part hereof and to which
Warrant Agreement reference is hereby made for a full description of the rights,
limitations of rights, duties and immunities hereunder of the Company and the
holder of the Warrant Certificate. Copies of the Warrant Agreement are on file
at the principal office of the Company.
This Warrant Certificate, with or without other Warrant Certificates, upon
surrender at the principal office of the Company, may be exchanged for another
Warrant Certificate or Warrant Certificates of like tenor and date evidencing
Warrants entitling the holder to purchase a like aggregate number of shares of
Common Stock as the Warrants evidenced by the Warrant Certificate or Warrant
Certificates so surrendered entitled such holder to purchase. If this Warrant
Certificate shall be exercised in part, the holder hereof shall be entitled to
receive upon surrender hereof another Warrant Certificate or Warrant
Certificates for the number of whole Warrants not exercised.
No fractional shares of Common Stock will be issued upon the exercise of
any Warrant or Warrants evidenced hereby, but in lieu thereof, a cash payment
will be made by the Company, as provided in the Warrant Agreement.
No holder of this Warrant Certificate shall be entitled to vote or receive
dividends or be deemed the holder of Common Stock or any other securities which
may at any time be issuable on the exercise hereof for any purpose, nor shall
anything contained in the Warrant Agreement or herein be construed to confer
upon the holder hereof, as such, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or upon any matter
submitted to stockholders at any meeting thereof, or to give or withhold consent
to any corporate action (whether upon any recapitalization, issue of stock,
reclassification of stock, change of par value or change of stock to no par
value, consolidation, merger, conveyance, or otherwise) or, except as provided
in the Warrant Agreement, to receive notice of meetings or to receive dividends
or subscription rights or otherwise, until the Warrant or Warrants evidenced by
this Warrant Certificate shall have been exercised and the shares of Common
Stock or other securities shall have become deliverable as provided in the
Warrant Agreement.
If this Warrant shall be surrendered for exercise within any period during
which the transfer books for the Company's Common Stock or other securities
purchasable upon the exercise of this Warrant are closed for any purpose, the
Company shall not be required to make delivery of certificates for the shares of
Common Stock or other securities purchasable upon such exercise until the date
of the reopening of said transfer books, subject to the terms of the Warrant
Agreement.
17
IN WITNESS WHEREOF, ASI SOLUTIONS INCORPORATED has caused the signature of
its President and Secretary to be printed hereon and its corporate seal to be
printed hereon.
Dated:
ASI SOLUTIONS INCORPORATED
By:_______________________________________
President
Attest:
___________________________________
Secretary
18
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to transfer the
Warrant Certificates.)
FOR VALUE RECEIVED, ____________________________________________
hereby sells, assigns and transfers unto
_________________________________________, this Warrant Certificate, together
with all right, title and interest therein, and does hereby irrevocably
constitute and appoint _______________________________________________ to
transfer the within Warrant Certificate on the books of the within-named
Company, with full power of substitution.
Dated: _______________________, _____
__________________________________________
Signature
Signature Guaranteed:
NOTICE
The signature on the foregoing Assignment must correspond in all
respects to the name as written upon the face of this Warrant Certificate,
without alteration, enlargement or any change whatsoever.
Accepted:
___________________________
Assignee:
19
EXHIBIT B
---------
FORM OF
ELECTION TO PURCHASE
(To be executed if holder desires to exercise the Warrant Certificate).
TO ASI SOLUTIONS INCORPORATED:
The undersigned hereby irrevocably elects to exercise __________
Warrants represented by this Warrant Certificate to purchase the shares of
Common Stock issuable upon the exercise of such Warrants and requests that
certificates for such shares be issued in the name of:
Please insert social security or other
identifying number
______________________________
_______________________________________________________________________________
(Please print name and address)
________________________________________________________________________________
If such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, a new Warrant Certificate for the balance remaining of such
Warrants shall be registered in the name of and delivered to:
Please insert social security or other
identifying number
______________________________
_______________________________________________________________________________
(Please print name and address)
_______________________________________________________________________________
Dated:_______________, 19__
__________________________________________
Signature
Signature Guaranteed:
20
NOTICE
The signature on the foregoing election to purchase must correspond in
all respects to the name as written upon the face of this Warrant Certificate,
without alteration, enlargement or any change whatsoever.
359307.c5
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