EXHIBIT 4.1
FORM OF WARRANT AGREEMENT
Warrant Agreement, dated as of ______________, 2000 (this "Agreement"),
between XXX.XXX, INC., a Delaware corporation (the "Company"), and [American
Securities Transfer & Trust Company], a [Delaware] corporation, as warrant agent
(the "Warrant Agent").
RECITALS
WHEREAS, the Company proposes to issue and deliver warrant certificates
(the "Warrant Certificates") evidencing warrants (the "Warrants") to purchase up
to an aggregate of [__________] shares of its Common Stock (as hereinafter
defined) to holders (the "Warrant Recipients") of the common stock, no par value
("INCC Common Stock"), of Internet Communications Corporation, a Colorado
corporation ("INCC"), in connection with the consummation of the merger
contemplated by the Agreement and Plan of Merger, dated as of March 17, 2000
(the "Merger Agreement"), by and among the Company, INCC and Internet
Acquisition Corporation, a Delaware corporation and a wholly-owned subsidiary of
the Company ("IAC"); and
WHEREAS, each Warrant will entitle the registered holder thereof to
purchase one fully paid and non-assessable share of Common Stock of the Company,
par value $0.001 per share (the "Common Stock"), at a purchase price per share
equal to the Exercise Price (as hereinafter defined);
In consideration of the foregoing and for the purpose of defining the terms
and provisions of the Warrants and the respective rights and obligations
thereunder of the Company and the Holders (as hereinafter defined), the Company
and the Warrant Agent each agree as follows:
Section 1. Certain Definitions. As used in this Agreement, the following
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terms shall have the following respective meanings:
"Affiliate" shall have the meaning given to such term in Rule 12b-2
promulgated under the Securities and Exchange Act of 1934, as amended.
"Agreement" shall have the meaning set forth in the Recitals to this
Agreement.
"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in Denver, Colorado or New York, New York are authorized
by law to close.
"Call Price" means a price per Warrant Share equal to $13.00.
"Call Trigger Event" means any date prior to the Termination Date after
which the daily closing prices per share of Common Stock on NASDAQ for each of
the five (5) consecutive trading days prior thereto is greater than or equal to
the Call Price.
"Certificate of Incorporation" means the Certificate of Incorporation of
the Company.
"Closing Price" on any day means (i) if the shares of Common Stock then are
listed and traded on the NYSE, the Closing Price on such day as reported on the
NYSE Composite Transactions Tape; (ii) if shares of Common Stock then are not
listed and traded on the NYSE, the Closing Price on such day as reported by the
principal national securities exchange on which the shares of Common Stock are
listed and traded; (iii) if the shares of Common Stock then are not listed and
traded on any such securities exchange, the last reported sale price on such day
on the NASDAQ; or (iv) if the shares of Common Stock then are not traded on the
NASDAQ, the average of the highest reported bid and the lowest reported asked
price on such day as reported by the NASDAQ Quotation System.
"Common Share Equivalent" means, with respect to any security of the
Company and as of a given date, a number which is, (i) in the case of a share of
Common Stock, one, (ii) in the case of all or a portion of any right, warrant or
other security which may be exercised for a share or shares of Common Stock, the
number of shares of Common Stock receivable upon exercise of such security (or
such portion of such security), and (iii) in the case of any security
convertible or exchangeable into a share or shares of Common Stock, the number
of shares of Common Stock that would be received if such security were converted
or exchanged on such date.
"Common Stock" shall have the meaning set forth in the Recitals to this
Agreement.
"Company" shall have the meaning set forth in the Preamble to this
Agreement.
"Convertible Securities" shall have the meaning set forth in Section 8(d).
"Effective Time" means the date of the filing of a certificate of merger
with the Secretary of State of the State of Delaware in connection with the
merger of IAC with and into INCC pursuant to the Merger Agreement.
"Determination Date" shall have the meaning set forth in Section 8(f).
"Exercise Date" shall mean, as to any Warrants, the date on which the
Warrant Agent shall have received both (a) the Warrant Certificate representing
such Warrants, with the Exercise Forms therein duly executed by the Holder
thereof or his attorney duly authorized in writing, and (b) payment in cash
(including wire transfer of immediately available funds) or by certified or
official bank check or bank cashier's check payable to the Company, of an amount
in lawful money of the United States of America equal to the applicable Exercise
Price (as hereinafter defined).
"Exercise Price" means a price per Warrant Share equal to $11.50, subject
to adjustment from time to time pursuant to Section 8.
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"Expiration Date" means 5:00 p.m. New York City time on [__________],
2002. [Insert date that is the second anniversary of the Closing Date].
"Fair Market Value" as at any date of determination means, as to shares of
the Common Stock, if the Common Stock is publicly traded at such time, the
average of the daily Closing Prices of a share of Common Stock for the five (5)
consecutive trading days ending on the most recent trading day prior to the date
of determination. If the shares of Common Stock are not publicly traded at such
time, and as to all things other than the Common Stock, Fair Market Value shall
be determined in good faith by an independent nationally recognized investment
banking firm selected by the Company and acceptable to a majority of the Holders
and which shall have no other substantial relationship with the Company.
"Holder" means, with respect to any Warrant Certificate, the Person in
whose name such Warrant Certificate is registered upon the books to be
maintained by the Warrant Agent pursuant to Section 3.
"IAC" shall have the meaning set forth in the Recitals to this Agreement.
"INCC" shall have the meaning set forth in the Recitals to this Agreement.
"INCC Common Stock" shall have the meaning set forth in the Recitals to
this Agreement.
"Merger Agreement" shall have the meaning set forth in the first Recital to
this Agreement.
"NASDAQ" means the Nasdaq Stock Market, National Market System.
"NYSE" means The New York Stock Exchange, Inc.
"Options" shall have the meaning set forth in Section 8(d).
"Person" means an individual, partnership, corporation, limited liability
company, trust, joint stock company, association, joint venture, or any other
entity or organization, including a government or political subdivision or an
agency or instrumentality thereof.
"Register" shall have the meaning set forth in Section 3(a) of this
Agreement.
"Securities Act" means the Securities Act of 1933, as amended.
"Subsidiary" means, with respect to any Person, any corporation or other
entity of which a majority of the capital stock or other ownership interests
having ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions are at the time directly or
indirectly owned by such Person.
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"Warrant Agent" shall have the meaning set forth in the Preamble to this
Agreement or the successor or successors of such Warrant Agent duly appointed in
accordance with the terms hereof.
"Warrant Certificates" shall have the meaning set forth in the Recitals to
this Agreement.
"Warrant Recipients" shall have the meaning set forth in the Recitals to
this Agreement.
"Warrant Shares" means the shares of Common Stock deliverable upon exercise
of the Warrants, as adjusted from time to time.
"Warrants" shall have the meaning set forth in the Recitals to this
Agreement.
Section 2. The Warrant Certificates. (a) Upon issuance, each Warrant
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Certificate shall evidence one or more Warrants. The Warrant Certificates shall
be in registered form only and substantially in the form attached hereto as
Exhibit A. The Warrant Certificates shall be dated the date on which they are
countersigned by the Warrant Agent and may have such legends and endorsements
typed, stamped, printed, lithographed or engraved thereon as the Company may
deem appropriate and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with applicable laws, rules or
regulations including any rule or regulation of any securities exchange on which
the Warrants may be listed.
(b) Warrant Certificates substantially in the form of Exhibit A
hereto and evidencing Warrants to purchase an aggregate of up to [_________]
shares of Common Stock (subject to adjustment pursuant to Sections 8 and 9)
shall be executed, on or after the date of this Agreement, by the Company and
delivered to the Warrant Agent for countersignature, and the Warrant Agent shall
thereupon countersign and deliver such Warrant Certificates upon the order and
at the direction of the Company. The names and addresses of the Warrant
Recipients shall be specified by the Company pursuant to a list of Warrant
Recipients provided to the Warrant Agent by the Company, which shall consist of
the names of those Persons who were stockholders of record of INCC as of the
Effective Time (excluding however Interwest Group, Inc., a Colorado corporation
("Interwest"), any affiliate thereof and any director of INCC), subject only to
the elimination of the names of (i) any such Persons as are entitled to receive
only a payment in lieu of a fractional Warrant in accordance with the terms of
this Agreement and (ii) any such Persons who have perfected their right to have
the fair value of their shares of INCC Common Stock judicially appraised and
paid to them in cash. The Warrant Agent is hereby authorized to countersign and
deliver Warrant Certificates as required by this Section 2(b) or by Section
3(b), 4(f) or 6 hereof. The Warrant Certificates shall be executed on behalf of
the Company by any of its duly authorized officers, either manually or by
facsimile signature printed thereon, and shall be dated the date of issuance.
The Warrant Agent shall countersign the Warrant Certificates either manually or
by facsimile signature printed thereon, and the Warrant Certificates shall not
be valid for any purpose until so countersigned. In case any duly authorized
officer of the Company whose signature shall have been placed upon any of the
Warrant Certificates shall cease to be such officer of the Company before
countersignature by
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the Warrant Agent and issue and delivery thereof, such Warrant Certificates may,
nevertheless, be countersigned by the Warrant Agent and issued and delivered
with the same force and effect as though such person had not ceased to be such
officer of the Company.
Section 3. Registration, Exchange and Transfer of Warrants. (a) The
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Warrant Agent shall keep at the principal corporate trust office of the Warrant
Agent, specified in or pursuant to Section 4(d), a register (the "Register") in
which, subject to such regulations as the Company may reasonably prescribe, the
Warrant Agent shall provide for the registration of Warrant Certificates and of
transfers or exchanges of Warrant Certificates as herein provided.
(b) At the option of the Holder, Warrant Certificates may be
exchanged at such office and upon payment of the charges hereinafter provided.
Whenever any Warrant Certificates are so surrendered for exchange, the Company
shall execute, and the Warrant Agent shall countersign and deliver, the Warrant
Certificates that the Holder making the exchange is entitled to receive;
provided, however, that the Company shall not be required to issue and deliver
Warrant Certificates representing fractional warrants.
(c) Each Warrant Certificate issued upon any registration of
transfer or exchange of Warrant Certificates shall be the valid obligation of
the Company, evidencing the same obligations, and entitled to the same benefits
under this Agreement as the Warrant Certificates surrendered for such
registration of transfer or exchange.
(d) Each Warrant Certificate surrendered for registration of
transfer or exchange shall (if so required by the Company or the Warrant Agent)
be duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Warrant Agent, duly executed by the Holder
thereof or his attorney duly authorized in writing.
(e) No service charge shall be made for any registration of
transfer or exchange of Warrant Certificates. The Company may require payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of Warrant
Certificates.
(f) Each Warrant Certificate when duly endorsed in blank shall be
negotiable and when a Warrant Certificate shall have been so endorsed, the
Holder thereof may be treated by the Company, the Warrant Agent and all other
persons dealing therewith as the sole and absolute owner thereof for any purpose
and as the person solely entitled to exercise the rights represented thereby or
to request the Warrant Agent to record the transfer thereof on the Register any
notice to the contrary notwithstanding; but until such transfer on such
Register, the Company and the Warrant Agent may treat the Holder thereof as the
owner for all purposes.
Section 4. Exercise Price, Payment of The Exercise Price, Duration And
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Exercise of Warrants Generally, Company's Call Right. (a) Each Warrant
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Certificate shall, when countersigned by the Warrant Agent, entitle the Holder
thereof, upon payment of the Exercise Price and subject to the provisions of
this Agreement, to receive one share of Common Stock for
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each whole Warrant represented thereby, subject to adjustment as herein
provided, upon payment of the Exercise Price for each of such shares.
(b) Subject to the terms and conditions set forth herein, the
Warrants shall be exercisable beginning on the date that is thirty (30) days
after the date hereof, at any time, or from time to time, until the Expiration
Date or, if such day is not a Business Day, then on the next succeeding day that
shall be a Business Day.
(c) The Warrants shall terminate and become void as of 5:00 P.M.
(Denver time) on the Expiration Date or, if such day is not a Business Day, then
as of 5:00 P.M. on the next succeeding day that shall be a Business Day, and all
rights of any Holder of a Warrant Certificate evidencing such Warrants under
this Agreement or otherwise shall cease.
(d) Subject to Sections 5 and 10 hereof, in order to exercise a
Warrant, the Holder thereof must surrender the Warrant Certificate evidencing
such Warrant, with one of the forms on the reverse of or attached to the Warrant
Certificates duly executed (with signature guaranteed), to the Warrant Agent at
its office at ________________________________, or at such other address as the
Warrant Agent may specify in writing to the Holders at their respective
addresses specified in the Register, together with payment-in-full of the
Exercise Price thereof. Upon such delivery and payment, the Holder shall be
deemed to be the holder of record of the number of shares of Common Stock
issuable upon exercise of the Warrant (or, in the case of a partial exercise of
this Warrant, the number of such shares as to which the Warrant has been
exercised), notwithstanding that the stock transfer books of the Company shall
then be closed or that certificates representing such shares shall not then be
actually delivered to the Holder.
(e) The Exercise Price must be paid in cash (including by wire
transfer of immediately available funds) or by certified or official bank check
or bank cashier's check payable to the order of the Company or by any
combination of such cash or check.
(f) The Warrants evidenced by a Warrant Certificate shall be
exercisable either as an entirety or, from time to time, for part only of the
number of whole Warrants evidenced thereby. If fewer than all of the Warrants
evidenced by a Warrant Certificate are exercised at any time, the Warrant
Certificate representing such Warrants shall be surrendered and a new Warrant
Certificate of the same tenor and for the number of Warrants that were not
exercised shall be issued by the Company. The Warrant Agent shall countersign
the new Warrant Certificate, register it in such name or names as may be
directed in writing by the Holder and deliver the new Warrant Certificate to the
person or persons entitled to receive the same.
(g) As soon as practicable on or after the Exercise Date, the Warrant
Agent shall notify the Company, and the Warrant Agent shall, within five
Business Days of the Exercise Date, deliver or cause to be delivered to or upon
any written order of any Holder appropriate evidence of ownership of any shares
of Common Stock issuable upon exercise of the Warrants or other securities or
property (including any cash, subject to any required withholding)
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to which the Holder is entitled hereunder, subject to Section 5. All funds
received upon the exercise of Warrants shall be deposited by the Warrant Agent
for the account of the Company, unless otherwise instructed in writing by the
Company.
(h) Notwithstanding anything contained herein or in the Merger
Agreement to the contrary, the Company shall have the right to call a Warrant at
any time prior to the expiration of such Warrant at the Call Price upon the
occurrence of the Call Trigger Event, subject to the provisions of this Section.
The Company shall provide written notice of the occurrence of the Call Trigger
Event to each Holder. Each Holder shall then have thirty (30) days after the
date of such notice to exercise the Warrants held by such Holder pursuant to the
terms hereof. If no action is taken by a Holder within thirty days after
receipt of notice of a Call Trigger Event, then the Warrants held by such Holder
shall be deemed terminated.
Section 5. Payment of Taxes. The Company shall pay any and all
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documentary, or similar issue or transfer taxes payable in respect of the
issuance or delivery of the Warrant Shares. The Company shall not, however, be
required to pay any transfer tax which may be payable in respect of any transfer
involved in the issue or delivery of Warrants or Warrant Shares (or other
securities or assets) in a name other than that in which the Warrants so
exercised were registered, and no such issue or delivery shall be made unless
and until the Person requesting such issue has paid to the Company the amount of
such transfer tax or has established, to the satisfaction of the Company, that
such transfer tax has been paid.
Section 6. Mutilated or Missing Warrant Certificates. If (a) any
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mutilated Warrant Certificate is surrendered to the Warrant Agent or (b) the
Company and the Warrant Agent receive evidence to their satisfaction of the
destruction, loss or theft of any Warrant Certificate, and there is delivered to
the Company and the Warrant Agent (in the case of destruction, loss or theft)
such security or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Company or the Warrant Agent
that such Warrant Certificate has been acquired by a bona fide purchaser, the
Company shall execute and the Warrant Agent shall countersign and deliver, in
exchange for any such mutilated Warrant Certificate or in lieu of any such
destroyed, lost or stolen Warrant Certificate, a new Warrant Certificate of like
tenor and for a like aggregate number of Warrants. Upon the issuance of any new
Warrant Certificate under this Section 6, the Company may require the payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and other expenses in connection therewith. Every
new Warrant Certificate executed and delivered pursuant to this Section 6 in
lieu of any destroyed, lost or stolen Warrant Certificate shall constitute an
original contractual obligation of the Company, whether or not the destroyed,
lost or stolen Warrant Certificate shall be at any time enforceable by anyone,
and shall be entitled to the benefits of this Agreement equally and
proportionately with any and all other Warrant Certificates duly executed and
delivered hereunder. The provisions of this Section 6 are exclusive and shall
preclude (to the extent lawful) all other rights or remedies with respect to the
replacement of mutilated, destroyed, lost or stolen Warrant Certificates.
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Section 7. Reservation of Shares; Listing. The Company shall at all times
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reserve and keep available, free from preemptive rights, and out of its
authorized but unissued Common Stock, solely for the purpose of issuance upon
exercise of Warrants as herein provided, such number of shares of Common Stock
as shall then be issuable upon exercise of all outstanding Warrants. The
Company covenants that all shares of Common Stock which shall be issuable upon
exercise of the Warrants shall, upon issue in accordance with the terms of this
Agreement, be duly and validly issued and fully paid and non-assessable and free
from all taxes, liens, and charges with respect to the issue thereof and that
upon issuance, such shares shall be listed on NASDAQ, if other shares of the
Common Stock are then listed for quotation on NASDAQ, and on each national
securities exchange on which any other shares of outstanding Common Stock are
then listed.
Section 8. Anti-dilution Provisions. So long as any Warrants are
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outstanding, the Exercise Price and the number of shares of Common Stock
issuable upon exercise of each whole Warrant shall be subject to adjustment from
time to time as follows:
(a) Common Stock Dividends, Subdivisions, Combinations. In case the
Company shall (i) pay or make a dividend or other distribution to all holders of
its Common Stock in shares of Common Stock, (ii) subdivide or split the
outstanding shares of its Common Stock into a larger number of shares, or (iii)
combine the outstanding shares of its Common Stock into a smaller number of
shares, then in each such case the number of Warrant Shares issuable upon
exercise of each whole Warrant shall be adjusted to equal the number of such
shares to which the Holder of the Warrant would have been entitled upon the
occurrence of such event had the Warrant been exercised immediately prior to the
happening of such event or, in the case of a stock dividend or other
distribution, prior to the record date for determination of stockholders
entitled thereto. An adjustment made pursuant to this Section 8(a) shall become
effective immediately after the effective date of such event retroactive to the
record date, if any, for such event.
(b) Reorganization or Reclassification. In case of any capital
reorganization or any reclassification of the capital stock of the Company
(whether pursuant to a merger or consolidation or otherwise), or in the event of
any similar transaction, each whole Warrant shall thereafter be exercisable for
the number of shares of stock or other securities or property receivable upon
such capital reorganization or reclassification of capital stock or other
transaction, as the case may be, by a holder of the number of shares of Common
Stock into which such Warrant was exercisable immediately prior to such capital
reorganization or reclassification of capital stock; and, in any case,
appropriate adjustment (as determined in good faith by the Board of Directors of
the Company) shall be made for the application of the provisions herein set
forth with respect to the rights and interests thereafter of the Holders of the
Warrants to the end that the provisions set forth herein shall thereafter be
applicable, as nearly as reasonably practicable, in relation to any shares of
stock or other securities or property thereafter deliverable upon the exercise
of the Warrants. An adjustment made pursuant to this Section 8(b)
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shall become effective immediately after the effective date of such event
retroactive to the record date, if any, for such event.
(c) Distributions of Assets or Securities Other than Common Stock.
In case the Company shall, by dividend or otherwise, distribute to all holders
of its Common Stock shares of any class of its capital stock (other than Common
Stock), or other debt or equity securities or evidences of indebtedness of the
Company, or options, rights or warrants to purchase any of such securities, cash
or other assets, then in each such case the number of Warrant Shares issuable
upon exercise of each whole Warrant shall be adjusted by multiplying the number
of Warrant Shares issuable upon exercise of each whole Warrant immediately prior
to the date of such dividend or distribution by a fraction, of which the
numerator shall be the Fair Market Value per share of Common Stock at the record
date for determining share holders entitled to such dividend or distribution,
and of which the denominator shall be such Fair Market Value per share less the
Fair Market Value of the portion of the securities, cash, other assets or
evidences of indebtedness so distributed applicable to one share of Common
Stock. An adjustment made pursuant to this Section 8(c) shall become effective
immediately after the effective date of such event retroactive to the record
date, if any, for such event.
(d) Below Market Issuances of Common Stock and Convertible
Securities. In case the Company shall issue Common Stock (or options, rights or
warrants to purchase shares of Common Stock (collectively, "Options") or other
securities convertible into or exchangeable or exercisable for shares of Common
Stock (such other securities, collectively, "Convertible Securities")) at a
price per share (or having an effective exercise, exchange or conversion price
per share together with the purchase price thereof) less than the Fair Market
Value per share of Common Stock on the date such Common Stock (or Options or
Convertible Securities), is sold or issued (provided that no sale of securities
pursuant to an underwritten public offering shall be deemed to be for less than
Fair Market Value), then in each such case the number of Warrant Shares issuable
upon exercise of each whole Warrant shall thereafter be adjusted by multiplying
the number of Warrant Shares issuable upon exercise of each whole Warrant
immediately prior to the date of issuance of such Common Stock (or Options or
Convertible Securities) by a fraction, the numerator of which shall be (x) the
sum of (i) the number of Common Share Equivalents represented by all securities
outstanding immediately prior to such issuance and (ii) the number of additional
Common Share Equivalents represented by all securities so issued multiplied by
(y) the Fair Market Value of a share of Common Stock immediately prior to the
date of such issuance, and the denominator of which shall be (x) the product of
(A) the Fair Market Value of a share of Common Stock immediately prior to the
date of such issuance and (B) the number of Common Share Equivalents represented
by all securities outstanding immediately prior to such issuance plus (y) the
aggregate consideration received by the Company for the total number of
securities so issued plus, (z) in the case of Options or Convertible Securities,
the additional consideration required to be received by the Company upon the
exercise, exchange or conversion of such securities; provided, however, that no
adjustment shall be required in respect of issuances of Common Stock (or options
to purchase Common Stock) pursuant to stock option or other employee benefit
plans in effect on the date
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hereof, or approved by the Board of Directors of the Company after the date
hereof. Notwithstanding anything herein to the contrary, (1) no further
adjustment to the number of Warrant Shares issuable upon exercise of each whole
Warrant shall be made upon the issuance or sale of Common Stock pursuant to (x)
the exercise of any Options or (y) the conversion or exchange of any Convertible
Securities, if in each case the adjustment in the number of Warrant Shares
issuable upon exercise of each whole Warrant was made as required hereby upon
the issuance or sale of such Options or Convertible Securities or no adjustment
was required hereby at the time such Option or Convertible Security was issued,
and (2) no adjustment to the number of Warrant Shares issuable upon exercise of
each whole Warrant shall be made upon the issuance or sale of Common Stock upon
the exercise of any Options existing on the original issue date hereof, without
regard to the exercise price thereof. Notwithstanding the foregoing, no
adjustment to the number of Warrant Shares issuable upon exercise of each whole
Warrant shall be made pursuant to this paragraph upon the issuance or sale of
Common Stock, Options, or Convertible Securities in a bona fide arm's-length
transaction to any Person or group that, at the time of such issuance or sale,
is not an Affiliate of the Company. An adjustment made pursuant to this Section
8(d) shall become effective immediately after such Common Stock, Options or
Convertible Securities are sold.
(e) Below Market Distributions or Issuances of Preferred Stock or
Other Securities. In case the Company shall issue non-convertible and non-
exchangeable preferred stock (or other debt or equity securities or evidences of
indebtedness of the Company (other than Common Stock or Options or Convertible
Securities) or options, rights or warrants to purchase any of such securities)
at a price per share (or other similar unit) less than the Fair Market Value per
share (or other similar unit) of such preferred stock (or other security) on the
date such preferred stock (or other security) is sold (provided that no sale of
preferred stock or other security pursuant to an underwritten public offering
shall be deemed to be for less than its fair market value), then in each such
case the number of Warrant Shares issuable upon exercise of each whole Warrant
shall thereafter be adjusted by multiplying the number of Warrant Shares
issuable upon exercise of each whole Warrant immediately prior to the date of
issuance of such preferred stock (or other security) by a fraction, the
numerator of which shall be the product of (i) the number of Common Share
Equivalents represented by all securities outstanding immediately prior to such
issuance and (ii) the Fair Market Value of a share of Common Stock immediately
prior to the date of such issuance, and the denominator of which shall be (x)
the product of (A) the number of Common Share Equivalents represented by all
securities outstanding immediately prior to such issuance and (B) the Fair
Market Value of a share of the Common Stock immediately prior to the date of
such issuance minus (y) the difference between (1) the aggregate Fair Market
Value of such preferred stock (or other security) and (2) the aggregate
consideration received by the Company for such preferred stock (or other
security). Notwithstanding the foregoing, no adjustment to the number of
Warrant Shares issuable upon exercise of each whole Warrant shall be made
pursuant to this paragraph upon the issuance or sale of preferred stock (or
other securities of the Company other than Common Stock or Options or
Convertible Securities) in a bona fide arm's-length transaction to any Person or
group that, at the time of such issuance or sale, is not an Affiliate of the
Company. An adjustment made
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pursuant to this Section 8(e) shall become effective immediately after such
preferred stock (or other security) is sold.
(f) Above Market Repurchases of Common Stock. If at any time or from
time to time the Company or any Subsidiary thereof shall repurchase, by self-
tender offer or otherwise, any shares of Common Stock of the Company (or any
Options or Convertible Securities) at a purchase price in excess of the Fair
Market Value thereof, on the Business Day immediately prior to the earliest of
(i) the date of such repurchase, (ii) the commencement of an offer to
repurchase, or (iii) the public announcement of either (such date being referred
to as the "Determination Date"), the number of Warrant Shares issuable upon
exercise of each whole Warrant shall be adjusted by multiplying the number of
Warrant Shares issuable upon exercise of each whole Warrant immediately prior to
such Determination Date by a fraction, the numerator of which shall be the
product of (1) the number of Common Share Equivalents represented by all
securities outstanding immediately prior to such Determination Date minus the
number of Common Share Equivalents represented by the securities repurchased or
to be purchased by the Company or any Subsidiary thereof in such repurchase and
(2) the Fair Market Value of a share of Common Stock immediately prior to such
Determination Date, and the denominator of which shall be (x) the product of (A)
the number of Common Share Equivalents represented by all securities outstanding
immediately prior to the Determination Date and (B) the Fair Market Value of a
share of Common Stock immediately prior to such Determination Date minus (y) the
sum of (1) the aggregate consideration paid by the Company in connection with
such repurchase and (2) in the case of Options or Convertible Securities, the
additional consideration required to be received by the Company upon the
exercise, exchange or conversion of such securities. Notwithstanding the
foregoing, no adjustment to the number of Warrant Shares issuable upon exercise
of each whole Warrant shall be made pursuant to this paragraph upon the
repurchase, by self-tender offer or otherwise, of Common Stock (or any Options
or Convertible Security) in a bona fide arm's-length transaction from any Person
or group that, at the time of such repurchase, is not an Affiliate of the
Company.
(g) Above Market Repurchases of Preferred Stock or Other Securities.
If at any time or from time to time the Company or any Subsidiary thereof shall
repurchase, by self-tender offer or otherwise, any shares of non-convertible and
non-exchangeable preferred stock (or other debt or equity securities or
evidences of indebtedness of the Company (other than Common Stock or Options or
Convertible Securities) or options, rights or warrants to purchase any of such
securities), at a purchase price in excess of the Fair Market Value thereof, on
the Business Day immediately prior to the Determination Date, the number of
Warrant Shares issuable upon exercise of each whole Warrant shall be adjusted by
multiplying the number of Warrant Shares issuable upon exercise of each whole
Warrant immediately prior to the Determination Date by a fraction, the numerator
of which shall be the product of (i) the number of Common Share Equivalents
represented by all securities outstanding immediately prior to such
Determination Date and (ii) the Fair Market Value of a share of Common Stock
immediately prior to such Determination Date, and the denominator of which shall
be (x) the product of (A) the number of Common Share Equivalents represented by
all securities
11
outstanding immediately prior to such Determination Date and (B) the Fair Market
Value of a share of Common Stock immediately prior to such Determination Date
minus (y) the difference between (1) the aggregate consideration paid by the
Company in connection with such repurchase and (2) the aggregate Fair Market
Value of such preferred stock (or other security). Notwithstanding the
foregoing, no adjustment to the number of Warrant Shares issuable upon exercise
of each whole Warrant shall be made pursuant to this paragraph upon the
repurchase, by self-tender offer or otherwise, of non-convertible and non-
exchangeable preferred stock (or other securities of the Company other than
Common Stock or Options or Convertible Securities) in a bona fide arm's-length
transaction from any Person or group that, at the time of such repurchase, is
not an Affiliate of the Company.
(h) Readjustment of the Number of Warrant Shares Issuable Upon
Exercise of Each Whole Warrant. If (i) the purchase price provided for in any
Option or the additional consideration, if any, payable upon the conversion or
exchange of any Convertible Securities or the rate at which any Convertible
Securities, in each case as referred to in paragraphs (b) and (f) above, are
convertible into or exchangeable for Common Stock shall change at any time
(other than under or by reason of provisions designed to protect against
dilution upon an event which results in a related adjustment pursuant to this
Section 8), or (ii) any of such Options or Convertible Securities shall have
irrevocably terminated, lapsed or expired, the number of Warrant Shares then
issuable upon exercise of each whole Warrant shall forthwith be readjusted
(effective only with respect to any exercise of Warrants after such
readjustment) to the number of Warrant Shares issuable upon exercise of each
whole Warrant which would then be in effect had the adjustment made upon the
issuance, sale, distribution or grant of such Options or Convertible Securities
been made based upon such changed purchase price, additional consideration or
conversion rate, as the case may be (in the case of any event referred to in
clause (i) of this paragraph (h)) or had such adjustment not been made (in the
case of any event referred to in clause (ii) of this paragraph (h)).
(i) Exercise Price Adjustment. Upon each adjustment of the number of
Warrant Shares issuable upon exercise of each whole Warrant pursuant to this
Section 8, the Exercise Price of each Warrant outstanding immediately prior to
such adjustment shall thereafter be equal to an adjusted Exercise Price per
Warrant Share determined (to the nearest cent) by multiplying the Exercise Price
for each whole Warrant immediately prior to such adjustment by a fraction, the
numerator of which shall be the number of Warrant Shares issuable upon exercise
of each whole Warrant immediately prior to such adjustment and the denominator
of which shall be the number of Warrant Shares issuable upon exercise of each
whole Warrant immediately after such adjustment.
(j) Consideration. If any shares of Common Stock, Options or
Convertible Securities shall be issued, sold or distributed for cash, the
consideration received in respect thereof shall be deemed to be the amount
received by the Company therefor, before deduction therefrom of any reasonable,
customary and adequately documented expenses incurred in connection therewith.
If any shares of Common Stock, Options or Convertible Securities shall
12
be issued, sold or distributed for a consideration other than cash, the amount
of the consideration other than cash received by the Company shall be deemed to
be the Fair Market Value of such consideration, before deduction of any
reasonable, customary and adequately documented expenses incurred in connection
therewith. If any shares of Common Stock, Options or Convertible Securities
shall be issued in connection with any merger in which the Company is the
surviving corporation, the amount of consideration therefor shall be deemed to
be the Fair Market Value of such portion of the assets and business of the non-
surviving corporation as shall be attributable to such Common Stock, Options or
Convertible Securities, as the case may be. If any Options shall be issued in
connection with the issuance and sale of other securities of the Company,
together comprising one integral transaction in which no specific consideration
is allocated to such Options by the parties thereto, such Options shall be
deemed to have been issued without consideration.
(k) No Impairment. The Company will not, by amendment of its
Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Company, but will at all
times in good faith assist in the carrying out of all the provisions of this
Section 8 and in the taking of all such action as may be necessary or
appropriate in order to protect the conversion rights of the Holders of the
Warrants against impairment. Without limiting the generality of the foregoing,
the Company will not increase the par value of any shares of Common Stock
issuable on the exercise of the Warrants above the amount payable therefor on
such exercise.
(l) Certificate as to Adjustments. Upon the occurrence of each
adjustment or readjustment of the number of Warrant Shares issuable upon
exercise of each whole Warrant pursuant to this Section 8, the Company, at its
expense, shall promptly compute such adjustment or readjustment in accordance
with the terms hereof and furnish to the Warrant Agent a certificate setting
forth such adjustment or readjustment and showing in detail the facts upon which
such adjustment or readjustment is based. The Company shall, upon the written
request at any time of any Holder of the Warrants, furnish or cause to be
furnished to such Holder a like certificate setting forth (1) such adjustments
and readjustments and (2) the number of Warrant Shares and the amount, if any,
of other property which at the time would be received upon the exercise of this
Warrant.
(m) Proceedings Prior to Any Action Requiring Adjustment. As a
condition precedent to the taking of any action which would require an
adjustment pursuant to this Section 8, the Company shall take any action which
may be necessary, including obtaining regulatory approvals or exemptions, in
order that the Company may thereafter validly and legally issue as fully paid
and nonassessable all Warrant Shares which the Holders are entitled to receive
upon exercise thereof.
(n) Notice of Adjustment. Upon the record date or effective date, as
the case may be, of any action which requires or might require an adjustment or
readjustment pursuant to
13
this Section 8, the Company shall forthwith file in the custody of its Secretary
or an Assistant Secretary at its principal executive office and with its
transfer agent and the Warrant Agent, an officers' certificate showing the
adjusted number of Warrant Shares determined as herein provided, setting forth
in reasonable detail the facts requiring such adjustment and the manner of
computing such adjustment. Each such officers' certificate shall be signed by
the chairman, president or chief financial officer of the Company and by the
secretary or any assistant secretary of the Company. Each such officers'
certificate shall be made available at all reasonable times for inspection by
the Holder or any Holder of a Warrant executed and delivered pursuant to Section
3(b) and the Company shall, forthwith after each such adjustment, mail a copy,
by first-class mail, of such certificate to the Holder or any such Holder.
(o) Payments in Lieu of Adjustment. The Holder shall, at its
option, be entitled to receive, in lieu of the adjustment pursuant to Section
8(c) otherwise required thereof, on (but not prior to) the date of exercise of
the Warrants, the evidences of indebtedness, other securities, cash, property or
other assets which such Holder would have been entitled to receive if it had
exercised its Warrants for Warrant Shares immediately prior to the record date
with respect to such distribution. Any Holder may exercise its option under this
Section 8(o) by delivering to the Company a written notice of such exercise
simultaneously with its notice of exercise of this Warrant.
Section 9. Consolidation, Merger or Sale of Assets. In case of any
---------------------------------------
consolidation of the Company with, or merger of the Company into, any other
Person, any merger of another Person into the Company (other than a merger which
does not result in any reclassification, conversion, exchange or cancellation of
outstanding shares of Common Stock) or any sale or transfer of all or
substantially all of the assets of the Company to the Person formed by such
consolidation or resulting from such merger or which acquires such assets, as
the case may be, each Holder of Warrants shall have the right thereafter to
exercise its Warrants for the kind and amount of securities, cash and other
property receivable upon such consolidation, merger, sale or transfer by a
holder of the number of shares of Common Stock for which such Holder's Warrants
may have been exercised immediately prior to such consolidation, merger, sale or
transfer. Adjustments for events subsequent to the effective date of such a
consolidation, merger, sale or transfer of assets shall be as nearly equivalent
as may be practicable to the adjustments provided for herein. In any such
event, effective provisions shall be made in the certificate or articles of
incorporation of the resulting or surviving corporation, in any contract of
sale, merger, conveyance, lease, transfer or otherwise so that the provisions
set forth herein for the protection of the rights of the Holders of the Warrants
shall thereafter continue to be applicable; and any such resulting or surviving
corporation shall expressly assume the obligation to deliver, upon exercise,
such shares of stock, other securities, cash and property. The provisions of
this Section 9 shall similarly apply to successive consolidations, mergers,
sales, leases or transfers.
Section 10. Fractional Shares. No fractional shares or scrip representing
-----------------
fractional shares shall be issued upon the exercise of the Warrants and in lieu
of delivery of any such fractional share upon any exercise thereof, the Company
shall pay to the Holder an amount in
14
cash equal to such fraction multiplied by the Fair Market Value thereof;
provided, however, that, in the event that the Company combines or reclassifies
the outstanding shares of its Common Stock into a smaller number of shares, it
shall be required to issue fractional shares to a Holder if the Holder exercises
all or any part of its Warrants, unless the Holder has consented in writing to
such reduction and provided the Company with a written waiver of its right to
receive fractional shares in accordance with this Section 10. If more than one
Warrant shall be presented for exercise in full at the same time by the same
Holder, the number of full shares of Common Stock that shall be issuable upon
such exercise thereof shall be computed on the basis of the aggregate number of
shares of Common Stock acquirable on exercise of the Warrants so presented. The
Holders, by their acceptance of the Warrant Certificates, expressly waive any
and all rights to receive any fraction of a share of Common Stock or a stock
certificate representing a fraction of a share of Common Stock.
Section 11. No Stock Rights. Prior to the exercise of the Warrants, no
---------------
Holder of a Warrant Certificate, as such, shall be entitled to vote or be deemed
the holder of shares of Common Stock or any other securities of the Company that
may at any time be issuable on the exercise thereof, nor shall anything
contained herein be construed to confer upon any Holder of a Warrant
Certificate, as such, the rights of a stockholder of the Company or the 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,
to exercise any preemptive right, to receive notice of meetings or other actions
affecting stockholders (except as provided herein), or to receive dividends or
subscription rights or otherwise.
Section 12. The Warrant Agent. (a) The Company hereby appoints the
-----------------
Warrant Agent to act as agent of the Company as set forth in this Agreement.
The Warrant Agent hereby accepts the appointment as agent of the Company and
agrees to perform that agency upon the terms and conditions herein set forth, by
all of which the Company and the Holders of Warrants, by their acceptance
thereof, shall be bound. No implied duties or obligations shall be read into
this Agreement against the Warrant Agent. The Warrant Agent shall not by
countersigning Warrant Certificates or by any other act hereunder be deemed to
make any representation as to validity or authorization of the Warrants or the
Warrant Certificates (except as to its countersignature thereon) or of any
securities or other property delivered upon exercise of any Warrant, or as to
the number or kind or amount of stock or other securities or other property
deliverable upon exercise of any Warrant. The Warrant Agent shall not have any
duty to calculate or determine any adjustments with respect either to the kind
and amount of shares or other securities or any property receivable by Holders
upon the exercise or tender of Warrants required from time to time, and the
Warrant Agent shall have no duty or responsibility in determining the accuracy
or correctness of any such calculation, other than to apply any adjustment,
notice of which is given by the Company to the Warrant Agent to be mailed to the
Holders in accordance with Section 8(i). The Warrant Agent shall not (i) be
liable for any recital or statement of fact contained herein or in the Warrant
Certificates or for any action taken, suffered or omitted by it in good faith on
the belief that any Warrant Certificate or any other documents or any signatures
are genuine or properly authorized, (ii) be responsible for any
15
failure on the part of the Company to comply with any of its covenants and
obligations contained in this Agreement or in the Warrant Certificates, or (iii)
be liable for any act or omission in connection with this Agreement except for
its own negligence or willful misconduct. The Warrant Agent is hereby authorized
to accept instructions with respect to the performance of its duties hereunder
from any officer of the Company and to apply to any such officer for
instructions (which instructions will be promptly given in writing when
requested) and the Warrant Agent shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with the instructions of
any such officer, except for its own negligence or willful misconduct, but in
its discretion the Warrant Agent may in lieu thereof accept other evidence of
such or may require such further or additional evidence as it may deem
reasonable.
(b) The Warrant Agent shall not be under any obligation or duty to
institute, appear in or defend any action, suit or legal proceeding in respect
hereof, unless first indemnified to its satisfaction, but this provision shall
not affect the power of the Warrant Agent to take such action as the Warrant
Agent may consider proper, whether with or without such indemnity. The Warrant
Agent shall promptly notify the Company in writing of any claim made or action,
suit or proceeding instituted against it arising out of or in connection with
this Agreement.
(c) The Company will perform, execute, acknowledge and deliver or
cause to be performed, executed, acknowledged and delivered all such further
acts, instruments and assurances as may reasonably be required by the Warrant
Agent in order to enable it to carry out or perform its duties under this
Agreement.
(d) The Company agrees to pay to the Warrant Agent compensation for
all services rendered by it hereunder as the Company and the Warrant Agent may
agree from time to time, and to reimburse the Warrant Agent for reasonable
expenses and disbursements incurred in connection with the execution and
administration of this Agreement (including the reasonable compensation and the
expenses of its counsel), and further agrees to indemnify the Warrant Agent for,
and to hold it harmless against any loss, liability or expense incurred without
gross negligence or bad faith on its part, arising out of or in connection with
the acceptance and administration of this Agreement, including the reasonable
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.
(e) The Warrant Agent and any stockholder, director, officer or
employee of the Warrant Agent may buy, sell and deal in any of the Warrants or
other securities of the Company or its Affiliates or become pecuniarily
interested in transactions in which the Company or its Affiliates may be
interested, or contract with or lend money to the Company or its Affiliates or
otherwise act as fully and freely as though it were not the Warrant Agent under
this Agreement. Nothing herein shall preclude the Warrant Agent from acting in
any other capacity for the Company or for any other legal entity.
(f) Anything in this Agreement to the contrary notwithstanding, in no
event shall the Warrant Agent be liable for special, indirect or consequential
loss or damage of any
16
kind whatsoever (including but not limited to loss of profits), even if the
Warrant Agent has been advised of the form of action.
Section 13. Resignation And Removal of Warrant Agent; Appointment of
--------------------------------------------------------
Successor. (a) No resignation or removal of the Warrant Agent and no
---------
appointment of a successor warrant agent shall become effective until the
acceptance of appointment by the successor warrant agent provided herein. The
Warrant Agent may resign its duties and be discharged from all further duties
and liability hereunder (except liability arising as a result of the Warrant
Agent's own negligence, bad faith or willful misconduct) after giving written
notice to the Company. The Company may remove the Warrant Agent upon written
notice, and the Warrant Agent thereupon in like manner be discharged from all
further duties and liabilities hereunder, except as aforesaid. Upon such
resignation or removal, the Company shall appoint in writing a new warrant
agent. If the Company shall fail to make such appointment within a period of 60
days after it has been notified in writing of such resignation by the resigning
Warrant Agent or after such removal, then a Holder may apply to any court of
competent jurisdiction for the appointment of a new warrant agent. Any new
warrant agent, whether appointed by the Company or by such a court, shall be a
corporation doing business under the laws of the United States or any State
thereof, in good standing and having a combined capital and surplus of not less
than $50,000,000. The combined capital and surplus of any such new warrant
agent shall be deemed to be the combined capital and surplus as set forth in the
most recent annual report of its condition published by such warrant agent prior
to its appointment, provided that such reports are published at least annually
pursuant to law or to the requirements of a Federal or state supervising or
examining authority. After acceptance in writing of such appointment by the new
warrant agent, it shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named herein as the Warrant Agent,
without any further assurance, conveyance, act or deed; but if for any reason it
shall be necessary or expedient to execute and deliver any further assurance,
conveyance, act or deed, the same shall be done at the expense of the Company
and shall be legally and validly executed and delivered by the resigning or
removed Warrant Agent. Not later than the effective date of any such
appointment, the Company shall give notice thereof to the resigning or removed
Warrant Agent. Failure to give any notice provided for in this Section,
however, or any defect therein, shall not affect the legality or validity of the
resignation of the Warrant Agent or the appointment of a new warrant agent, as
the case may be.
(b) Any corporation into which the Warrant Agent or any new warrant
agent may be merged or any corporation resulting from any consolidation to which
the Warrant Agent or any new warrant agent shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Warrant Agent, shall be a successor Warrant Agent under this Agreement without
any further act, provided that such corporation (i) would be eligible for
appointment as successor to the Warrant Agent under the provisions of Section
12(a) or (ii) is a wholly owned subsidiary of the Warrant Agent. Any such
successor Warrant Agent shall promptly cause notice of its succession as Warrant
Agent to be mailed first-class mail, postage prepaid) to each Holder at such
Holder's last address as shown on the Register.
17
Section 14. Money And Other Property Deposited With The Warrant Agent.
---------------------------------------------------------
Any moneys, securities or other property that at any time shall be deposited on
behalf of the Company with the Warrant Agent pursuant to this Agreement shall be
and are hereby assigned, transferred and set over to the Warrant Agent in trust
for the purpose for which such moneys, securities or other property shall have
been deposited; provided, however, such moneys, securities or other property
need not be segregated from other funds, securities or other property except to
the extent required by law.
Section 15. NOTICES. (a) Except as otherwise provided in Section 15 (b),
-------
any notice, demand or delivery authorized by this agreement shall be
sufficiently given or made when mailed if sent by first-class mail, postage
prepaid, addressed to any Holder at such Holder's address shown on the Register
and to the Company or the Warrant Agent as follows:
If to the Company: XXX.XXX, Inc.
000 00/xx/ Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx, Vice President and General
Counsel
with a copy to: Xxxxx, Johnson, Robinson, Xxxx & Xxxxxxxxx, P.C.
000 00/xx/ Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxx, Esq.
Xxxxxxxxxx, Xxxxx & Xxxxxx, P.C.
000 00/xx/ Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
If to the Warrant
Agent: American Securities Transfer & Trust Company
[ADDRESS]
Attention: _________________
or such other address as shall have been furnished to the party giving or making
such notice, demand or delivery.
(b) Any notice required to be given by the Company to the Holders
shall be made by mailing by registered mail, return receipt requested, to the
Holders at their respective addresses shown on the Register. The Company hereby
irrevocably authorizes the Warrant Agent, in the name and at the expense of the
Company, to mail any such notice upon receipt
18
thereof from the Company. Any notice that is mailed in the manner herein
provided shall be conclusively presumed to have been duly given when mailed,
whether or not the Holder receives the notice.
SECTION 16. Amendments; Waivers. (a) The Company may from time to time
-------------------
supplement or amend this Agreement without the consent of any Holder, in order
to (i) cure any ambiguity or correct or supplement any provision herein that may
be defective or inconsistent with any other provision herein or (ii) add to the
covenants and agreements of the Company for the benefit of the Holders, or
surrender any rights or powers reserved to or conferred upon the Company in this
Agreement. Upon the delivery of a certificate from an appropriate officer of
the Company which states that the proposed supplement or amendment is in
compliance with the terms of this Section 16, the Warrant Agent shall join with
the Company in the execution and delivery of any such supplemental agreements
unless it affects the Warrant Agent's own rights, duties or immunities hereunder
in which case such party may, but shall not be required to, join in such
execution and delivery.
(b) With the consent of the registered Holders of at least a majority
in number of the Warrants at the time outstanding, the Company and the Warrant
Agent may at any time and from time to time by supplemental agreement or
amendment add any provisions to or change in any manner or eliminate any of the
provisions of this Agreement or of any supplemental agreement or modify in any
manner the rights and obligations of the Warrant holders and of the Company;
provided, however, that no such supplemental agreement or amendment shall,
without the consent of the registered Holder of each outstanding Warrant
affected thereby:
(i) alter the provisions of this Agreement so as to affect adversely
the terms upon which the Warrants are exercisable; or
(ii) reduce the number of Warrants outstanding the consent of whose
Holders is required for any such supplemental agreement or amendment.
Upon the delivery of a certificate from an appropriate officer of the Company
which states that the proposed supplement or amendment is in compliance with the
terms of this section, the Warrant Agent shall join with the Company in the
execution and delivery of any such supplemental agreements unless it affects the
Warrant Agent's own rights, duties or immunities hereunder in which case such
party may, but shall not be required to, join in such execution and delivery.
(c) No failure or delay by either party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
19
Section 17. Persons Benefitting. This Agreement shall be binding upon and
-------------------
inure to the benefit of the Company and the Warrant Agent, and their respective
successors, assigns, beneficiaries, executors and administrators, and each
registered Holder of the Warrants. Nothing in this Agreement is intended or
shall be construed to confer upon any person, other than the Company, the
Warrant Agent and the Holders of the Warrants, any right, remedy or claim under
or by reason of this Agreement or any part hereof.
Section 18. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be deemed an original, but all of which
together constitute one and the same instrument.
Section 19. Surrender of Certificates. Any Warrant Certificate
-------------------------
surrendered for exercise or purchase or otherwise acquired by the Company shall,
if surrendered to the Company, be delivered to the Warrant Agent, and all
Warrant Certificates surrendered or so delivered to the Warrant Agent shall be
promptly cancelled by such Warrant Agent and shall not be reissued by the
Company. The Warrant Agent shall deliver such cancelled Warrant Certificates to
the Company.
Section 20. Termination of Agreement. This Agreement shall terminate and
------------------------
be of no further force and effect on the earlier of (a) the Expiration Date or
(b) the date on which all of the Warrants have been exercised, except that the
provisions of Sections 11 and 13 shall continue in full force and effect after
such termination date.
Section 21. Governing Law. This Agreement and the Warrants issued
-------------
hereunder and all rights arising hereunder and thereunder shall be construed and
determined in accordance with the internal laws of the state of Delaware, and
the performance hereof and thereof shall be governed and enforced in accordance
with such laws.
Section 22. Interpretation. When a reference is made in this Agreement to
--------------
a Section, such reference shall be to a Section of this Agreement unless
otherwise indicated. Whenever the words "include", "includes" or "including"
are used in this Agreement, they shall be deemed to be followed by the words
"without limitation". The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement. The definitions
contained in this Agreement are applicable to the singular as well as the plural
forms of such terms and to the masculine as well as to the feminine and neuter
genders of such term. References to a Person are also to its permitted
successors and assigns and, in the case of an individual, to his heirs and
estate, as applicable.
[SIGNATURE PAGE FOLLOWS]
20
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by its officer thereunto duly authorized as of the date first above
written.
XXX.XXX, INC.
By:__________________________________________
Name:
Title:
AMERICAN SECURITIES TRANSFER & TRUST COMPANY, as
Warrant Agent
By:__________________________________________
Name:
Title:
21
EXHIBIT A
---------
FORM OF FACE OF WARRANT CERTIFICATE
WARRANTS TO PURCHASE COMMON STOCK
OF XXX.XXX, INC.
No.__________ Certificate for Warrants -----
This certifies that ______________________, or registered assigns, is the
registered holder of the number of Warrants set forth above (the "Warrants").
Each Warrant entitles the holder thereof (a "Holder"), subject to the provisions
contained herein and in the Warrant Agreement referred to below, to purchase
from XXX.XXX, Inc., a Delaware corporation (the "Company"), one share of Common
Stock, par value $0.001 per share, of the Company ("Common Stock"), at the
exercise price (the "Exercise Price") of $11.50 per share, subject to adjustment
upon the occurrence of certain events. This Warrant Certificate shall terminate
and become void as of the close of business on [DATE THAT IS 2 YEARS AFTER
CLOSING DATE] (the "Expiration Date"); provided, however, that if the last day
for the exercise of the Warrants shall not be a Business Day, then the Warrants
may be exercised on the next succeeding Business Day (as defined in the Warrant
Agreement) following the Expiration Date.
This Warrant Certificate is issued under and in accordance with the Warrant
Agreement, dated as of ____________, 2000 (the "Warrant Agreement"), between the
Company and American Securities Transfer & Trust Company, as warrant agent (the
"Warrant Agent", which term includes any successor Warrant Agent under the
Warrant Agreement), and is subject to the terms and provisions contained in the
Warrant Agreement, to all of which terms and provisions the Holder of this
Warrant Certificate consents by acceptance hereof. The Warrant Agreement is
hereby incorporated herein by reference and made a part hereof. Reference is
hereby made to the Warrant Agreement for a full statement of the respective
rights, limitations of rights, duties, obligations and immunities thereunder of
the Company, the Warrant Agent and the Holders of the Warrants. As provided in
the Warrant Agreement and subject to the terms and conditions therein set forth,
the Warrants are exercisable on the date that is thirty days after the date
hereof. At 5:00 P.M. (New York City time) on the Expiration Date, each Warrant
not exercised prior thereto shall terminate and become void and of no value;
provided, however, that if the last day for the exercise of the Warrants shall
not be a Business Day, then the Warrants may be exercised until 5:00 P.M. (New
York City time) on the next succeeding Business Day following the Expiration
Date.
The Exercise Price and the number of shares of Common Stock issuable upon
the exercise of each whole Warrant are subject to adjustment as provided in the
Warrant Agreement.
In order to exercise a Warrant, the registered holder hereof must surrender
this Warrant Certificate at the office of the Warrant Agent, with the Exercise
Subscription Form on the reverse hereof duly executed by the Holder hereof, with
signature guaranteed as therein specified, together with any required payment in
full of the Exercise Price then in effect or the
1
share(s) of Common Stock as to which the Warrant(s) represented by this Warrant
Certificate are submitted for exercise, all subject to the terms and conditions
hereof and of the Warrant Agreement. Any such payment of the Exercise Price
shall be paid in cash (including by wire transfer of immediately available
funds) or by certified or official bank check or bank cashier's check payable to
the order of the Company or by any combination of such cash or check.
The Company will pay all documentary stamp taxes, if any, attributable to
the initial issuance of Common Stock upon the exercise of Warrants; provided,
however, that the Company shall not be required to pay any tax or other
governmental charge which may be payable in respect of any transfer involved in
the issue or delivery of any Warrant Certificates or certificates for Common
Stock issued upon the exercise of Warrants in a name other than that of the
registered Holder of such Warrants, and the Company shall not register any such
transfer or issue any such certificate until such tax or governmental charge, if
required, shall have been paid.
This Warrant Certificate and all rights hereunder are transferable by the
registered holder hereof, in whole or in part, on the register of the Company,
upon surrender of this Warrant Certificate for registration of transfer at the
principal corporate trust office of the Warrant Agent maintained for such
purpose in the City of Denver, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Warrant Agent
duly executed by the Holder hereof, or his attorney duly authorized in writing,
with signature guaranteed as specified in the attached Form of Assignment. Upon
any partial transfer, the Company will issue and deliver to such holder a new
Warrant Certificate or Certificates with respect to any portion not so
transferred; provided, however, that the Company shall not be required to issue
and deliver Warrant Certificates representing fractional warrants.
No service charge shall be made for any registration of transfer or
exchange of the Warrant Certificates, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
This Warrant Certificate and the Warrant Agreement are subject to amendment
as provided in the Warrant Agreement.
All terms used in this Warrant Certificate that are defined in the Warrant
Agreement shall have the meanings assigned to them in the Warrant Agreement.
Copies of the Warrant Agreement are on file at the office of the Warrant
Agent and may be obtained by writing to the Warrant Agent at the following
address: [ADDRESS], Attention: _____________________.
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This Warrant Certificate shall not be valid for any purpose until it shall
have been countersigned by the Warrant Agent.
Dated: ______________, ______
XXX.XXX, INC.
By:__________________________________________
Name:
Title:
Countersigned:
AMERICAN SECURITIES TRANSFER & TRUST COMPANY, as Warrant Agent
By:________________________
Name:
Title:
3
FORM OF REVERSE OF WARRANT CERTIFICATE
EXERCISE SUBSCRIPTION FORM
(To be executed only upon exercise of Warrants)
To: XXX.XXX, Inc.
The undersigned irrevocably exercises __________________ of the Warrants
for the purchase of one share per Warrant (subject to adjustment) of Common
Stock, par value $0.001 per share, of XXX.XXX, Inc. represented by this Warrant
Certificate hereof and herewith makes payment of $_____________ (such amount
shall be paid in cash (including by wire transfer of immediately available
funds) or by certified or official bank check or bank cashier's check payable to
the order of XXX.XXX, Inc. or by any combination of such cash or check),
representing the Exercise Price for such Warrants so exercised. On the terms
and conditions specified in this Warrant Certificate and the Warrant Agreement
therein referred to, the undersigned hereby surrenders this Warrant Certificate
and all right, title and interest therein to and directs that the shares of
Common Stock deliverable upon the exercise of such Warrants be registered or
placed in the name and at the address specified below and delivered thereto.
Date:______________, _____ ____________________________________
(Name - Please Print)
____________________________________
(Signature of Owner)(1)
____________________________________
(Xxxxxx Xxxxxxx)
____________________________________
(City) (State) (Zip Code)
____________________________________
(Signature Guaranteed by)
(1) The signature must correspond with the name as written upon the face of the
within Warrant Certificate in every particular, without alteration or
enlargement or any change whatever, and must be guaranteed.
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Securities and/or check to be issued to:______________________________________
Please insert social security or identifying number:__________________________
Name:_________________________________________________________________________
Street Address:_______________________________________________________________
City, State and Zip Code:_____________________________________________________
Any unexercised Warrants evidenced by the within Warrant Certificate to be
issued to:____________________________________________________________________
Please insert social security or identifying number:__________________________
Name:_________________________________________________________________________
Street Address:_______________________________________________________________
City, State and Zip Code:_____________________________________________________
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FORM OF ASSIGNMENT
FOR VALUE RECEIVED the undersigned registered holder of the within Warrant
Certificate hereby sells, assigns, and transfers unto the Assignee(s) named
below (including the undersigned with respect to any Warrants constituting a
part of the Warrants evidenced by the within Warrant Certificate not being
assigned hereby) all of the right of the undersigned under the within Warrant
Certificate, with respect to the number of whole Warrants set forth below:
Social Security
Number or Other
Identifying Number of Number of
Name of Assignees Address Assignees Warrants
---------------------------------------------------------------------------------------------------
and does hereby irrevocably constitute and appoint ________________________ the
undersigned's attorney to make such transfer on the books of the Warrant Agent
maintained for that purpose, with full power of substitution in the premises.
Date:_______________, _____
________________________________________________
(Signature of Owner) (2)
________________________________________________
(Street Address)
________________________________________________
(City) (State) (Zip Code)
________________________________________________
(Signature Guaranteed by)
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(2) The signature must correspond with the name as written upon the face of the
within Warrant Certificate in every particular, without alteration or
enlargement or any change whatever, and must be guaranteed.
7
