EXHIBIT 4.1
UNDERWRITER'S WARRANT AGREEMENT
THIS UNDERWRITER'S WARRANT AGREEMENT (the "Agreement"), dated as of
October __, 1996 is made and entered into by and between JAVELIN SYSTEMS, INC.,
a Delaware corporation (the "Company"), and MERIDIAN CAPITAL GROUP, INC. (the
"Warrantholder").
The Company agrees to issue and sell, and the Warrantholder agrees to
purchase, for a purchase price of $.0001 per warrant, warrants, as hereinafter
described (the "Warrants"), to purchase up to an aggregate of 85,000 shares,
subject to adjustment pursuant to the terms hereof (the "Shares") of the
Company's Common Stock, $.01 par value (the "Common Stock"), in connection with
a public offering (the "Public Offering") by the Company of up to 850,000 shares
of Common Stock pursuant to an underwriting agreement (the "Underwriting
Agreement"), dated as of October 25, 1996 between the Company and the
Warrantholder. The Warrants will be issued and sold hereunder at the rate of
one Warrant to purchase one share of Common Stock for each 10 shares of Common
Stock sold pursuant to the Underwriting Agreement, up to a maximum aggregate of
85,000 Warrants, and shall be issued in the name of the Warrantholder. The
purchase and sale of the Warrants shall occur on the First Closing Date, as
defined in the Underwriting Agreement.
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, the Company and the Warrantholder, for value received, hereby agree
as follows:
Section 1. Transferability and Form of Warrants.
1.1 Registration. The Warrants shall be numbered and shall be registered
on the books of the Company when issued. The Company may deem and treat the
Warrantholder of record as the owner of the Warrants for the purpose of any
exercise thereof and any distribution to the holder thereof and for all other
purposes.
1.2 Transfer. The Warrants shall be transferable in whole or in part
only on the books of the Company maintained at its principal office in Tustin,
California, or wherever its principal office may then be located, upon delivery
thereof duly endorsed by the Warrantholder or by its duly authorized attorney or
representative, accompanied by proper evidence of succession, assignment or
authority to transfer, and if reasonably determined by counsel to the Company,
an opinion of counsel reasonably satisfactory to the Company that such transfer
is exempt from registration under the Securities Act of 1933, as amended (the
"Act"). Upon any registration of transfer, the Company shall execute and
deliver new Warrants to the person or persons entitled thereto, and the
surrendered Warrants shall be canceled by the Company.
1.3 Limitations on Transfer of the Warrants. The Warrants shall not
be sold, transferred, assigned or hypothecated by the Warrantholder, until
October __, 1997, except that the Warrants may be transferred, in whole or in
part, to (i) one or more persons, each of whom on the date of transfer is an
officer or partner of the Warrantholder; (ii) a successor to the Warrantholder
in merger or consolidation; (iii) a purchaser of all or substantially all of the
Warrantholder's assets; or (iv) any person receiving the Warrants from one or
more of the persons listed in this subsection 1.3 at such person's or persons'
death pursuant to a will or trust or the laws of intestate succession. After one
year, a transfer of a Warrant may occur if the Warrant is exercised immediately
upon transfer, if the Warrant is not exercised immediately upon such transfer,
the Warrant shall lapse. The Warrants may be divided or combined, upon request
to the Company by the Warrantholder, into a certificate or certificates
representing the right to purchase the same aggregate number of Shares. Unless
the context indicates otherwise, the term "Warrantholder" shall include any
transferee or transferees of the Warrants pursuant to this subsection 1.3, and
the term "Warrants" shall include any and all warrants outstanding pursuant to
this Agreement, including those evidenced by a certificate or certificates
issued upon division, exchange, substitution or transfer pursuant to this
Agreement. The Warrantholder agrees that prior to making any disposition of the
Warrants or the Shares, other than to persons or entities identified in clauses
(i) through (iv), inclusive, of this Section 1.3, the Warrantholder shall give
written notice to the Company describing briefly the manner in which any such
proposed disposition is to be made; and no such disposition shall be made if the
Company has notified the Warrantholder that in the opinion of counsel,
reasonably satisfactory to the Warrantholder, a registration statement or other
notification or post-effective amendment thereto (hereinafter collectively a
"Registration Statement") under the Act is required with respect to such
disposition and no such Registration Statement has been filed by the Company,
with, and declared effective, if necessary, by, the Securities and Exchange
Commission (the "Commission").
1.4 Form of Warrants. The text of the Warrants and the form of
election to purchase Shares shall be substantially as sct forth in Exhibit A
attached hereto. The number of Shares issuable upon exercise of the Warrants is
subject to adjustment upon the occurrence of certain events, all as hereinafter
provided. The Warrants shall be executed on behalf of the Company by its
President or by a Vice President. A Warrant bearing the signature of an
individual who was at the time of signature the proper officer of the Company
shall bind the Company, notwithstanding that such individual shall have ceased
to hold such office prior to the delivery of such Warrant or did not hold such
office on the date of this Agreement.
The Warrants shall be dated as of the date of signature thereof by the
Company either upon initial issuance or upon division, exchange, substitution or
transfer.
1.5 Legend on Shares. Each Warrant certificate and certificate of
Shares initially issued upon exercise of the Warrants shall bear the following
legend, unless, at the time of exercise, such Shares are subject to a currently
effective registration statement under the Act:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND MAY NOT BE
SOLD, EXCHANGED, HYPOTHECATED OR TRANSFERRED IN ANY MANNER EXCEPT PURSUANT TO A
REGISTRATION OR AN EXEMPTION FROM SUCH REGISTRATION AND IN COMPLIANCE WITH THE
AGREEMENT PURSUANT TO WHICH THEY WERE ISSUED."
Any certificate issued at any time in exchange or substitution for any
certificate bearing such legend (except a new certificate issued upon completion
of a public distribution pursuant to
a registration statement under the Act, of the securities represented thereby)
shall also bear the above legend unless, in the opinion of the Company's
counsel, the securities represented thereby need no longer be subject to such
restrictions. In addition, if the Shares deliverable upon exercise of any
Warrants are not subject to a currently effective Registration Statement under
the Act, the Warrantholder shall deliver to the Company such representations and
certifications as the Company, or the Company's counsel, shall reasonably
require in order to comply with applicable federal and state securities laws for
the issuance of such Shares.
Section 2. Exchange of Warrant Certificate. Any Warrant certificate may
be exchanged for another certificate or certificates entitling the Warrantholder
to purchase a like aggregate number of Shares as the certificate or certificates
surrendered then entitled the Warrantholder to purchase. Any Warrantholder
desiring to exchange a Warrant certificate shall make such request in writing
delivered to the Company, and shall surrender, properly endorsed, the
certificate evidencing the Warrant to be so exchanged. Thereupon, the Company
shall execute and deliver to the person or persons entitled thereto a new
Warrant certificate as so requested and the Warrants so surrendered for exchange
shall be canceled by the Company.
Section 3. Term of Warrants; Exercise of Warrants.
3.1 Subject to the terms of this Agreement, the Warrantholder shall have
the right, at any time during the period commencing at 9:00 a.m., Pacific Time,
on October __, 1997 and ending at 5:00 p.m., Pacific Time, on October __, 2001
(the "Termination Date"), to purchase from the Company up to the number of fully
paid and nonassessable Shares to which the Warrantholder may at the time be
entitled to purchase pursuant to this Agreement, upon surrender to the Company,
at its principal office, of the certificate evidencing the Warrants to be
exercised, together with the purchase form on the reverse thereof duly filled in
and signed, and upon payment to the Company of the Warrant Price (as defined in
and determined in accordance with the provisions of this Section 3 and Sections
7 and 8 hereof), for the number of Shares in respect of which such Warrants are
then exercised, but in no event for less than 100 Shares (unless less than an
aggregate of 100 Shares are then purchasable under all outstanding Warrants held
by a Warrantholder). Payment of the aggregate Warrant Price shall be made in
cash, by check, or as set forth in Section 3.3
3.2 The Warrants shall be exercisable, at the election of the
Warrantholder, either in full or from time to time in part. Any Warrants not
surrendered to the Company for exercise in accordance with this Section 3.1
prior to 5:00 p.m., Pacific Time, on the Termination Date shall be void.
3.2 The Warrants shall be deemed to have been exercised immediately prior
to the close of business on the date of their surrender for exercise as provided
above, and the person entitled to receive the Shares issuable upon such exercise
shall be treated for all purposes as the holder of record of such shares as of
the close of business on such date. As promptly as practicable on or after such
date and in any event within ten (10) days thereafter, the Company at its
expense shall issue and deliver to the person or persons entitled to receive the
same a certificate or certificates for the number of full Shares issuable upon
such exercise together with cash, as provided in Section 9 hereof, in respect of
any fractional Shares otherwise issuable upon such surrender; provided that if
the Shares deliverable upon exercise of any Warrants are not subject to a
currently effective Registration Statement under the Act, the Warrantholder has
delivered such representations and certifications as the Company, or the
Company's counsel, may reasonably require pursuant to Section 1.5 hereof. In
the event that the Warrants are exercised in part, the Company at its expense
will execute and deliver new Warrants of like tenor exercisable for the number
of Shares for which the Warrants may then be exercised.
3.3 In lieu of exercising the Warrants, the Warrantholder may elect to
receive Shares equal to the value of the Warrants (or the portion thereof being
canceled) by the surrender of the Warrants at the principal office of the
Company together with notice of such election in which event the Company shall
issue to the Warrantholder a number of shares of Common Stock computed using the
following formula:
Y (A - B)
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X= A
Where
X - The number of Shares to be issued to Warrantholder.
Y - The number of Shares purchasable under the Warrant, or if only a
portion of the Warrant is being exercised, the portion of the Warrant being
canceled on such date.
A - The Current Market Price of one share of the Company's Common Stock
(as defined in Section 9).
B - Warrant Price (as adjusted to the date of such calculations).
Section 4. Payment of Taxes. The Company will pay all documentary stamp
taxes, if any, attributable to the initial issuance of the Warrants or the
Shares; provided, however, that the Company shall not be required to pay any tax
which may be payable with respect to any secondary transfer of the Warrants or
the Shares.
Section 5. Mutilated or Missing Warrants. In case the certificate or
certificates evidencing the Warrants shall be mutilated, lost, stolen or
destroyed, the Company shall, at the request of the Warrantholder, issue and
deliver in exchange and substitution for and upon cancellation of the mutilated
certificate or certificates, or in lieu of and substitution for the certificate
or certificates lost, stolen or destroyed, a new Warrant certificate or
certificates of like tenor and representing an equivalent right or interest, but
only upon receipt of evidence satisfactory to the Company of such loss, theft or
destruction of such Warrant.
Section 6. Reservation of Shares. There has been reserved, and the
Company shall at all times keep reserved so long as the Warrants remain
outstanding, out of its authorized Common Stock, such number of shares of Common
Stock as shall be subject to purchase under the Warrants.
Section 7. Warrant Price. The price per Share at which Shares shall
be purchasable upon the exercise of the Warrants (the "Warrant Price") shall be
$6.25 subject to further adjustment pursuant to Section 8 hereof.
Section 8. Adjustments. The number and kind of securities purchasable
upon the exercise of the Warrants and the Warrant Price shall be subject to
adjustment from time to time upon the happening of certain events, as follows:
8.1 Mergers, Consolidations or Sale of Assets. If at any time there
shall be a capital reorganization (other than a combination or subdivision of
Common Stock otherwise provided for herein), or a merger or consolidation of the
Company with or into another corporation, or the sale of the Company's
properties and assets as, or substantially as, an entirety to any other person,
then, as a part of such reorganization, merger, consolidation or sale, lawful
provision shall be made so that the Warrantholder shall thereafter be entitled
to receive upon exercise of the Warrants and payment of the Warrant Price, the
number of shares of stock or other securities or property of the Company or the
successor corporation resulting from such reorganization, merger, consolidation
or sale, to which a holder of the Shares deliverable upon exercise of the
Warrants would have been entitled under the provisions of the agreement in such
reorganization, merger, consolidation or sale if the Warrants had been exercised
immediately before consummation of such reorganization, merger, consolidation or
sale. In any such case, appropriate adjustment (as determined in good faith by
the Company's Board of Directors) shall be made in the application of the
provisions of the Warrants with respect to the rights and interests of the
Warrantholder after the reorganization, merger, consolidation or sale to the end
that the provisions of the Warrants (including adjustment of the Warrant Price
then in effect and the number of Shares) shall be applicable after that event,
as near as reasonably may be, in relation to any shares or other property
deliverable after that event upon exercise of the Warrants.
8.2 Splits, Subdivisions and Dividends. In the event the Company should
at any time or from time to time fix a record date for the effectuation of a
split or subdivision of the outstanding shares of Common Stock or the
determination of the holders of Common Stock entitled to receive a dividend or
other distribution payable in additional shares of Common Stock or other
securities or rights convertible into, or entitling the holder thereof to
receive directly or indirectly, additional shares of Common Stock (hereinafter
referred to as the "Common Stock Equivalents") without payment of any
consideration by such holder for the additional shares of Common Stock or Common
Stock Equivalents (including the additional shares of Common Stock issuable upon
conversion or exercise thereof), then, as of such record date (or the date of
such distribution, split or subdivision if no record date is fixed), the per
share Warrant Price shall be appropriately decreased and the number of Shares
shall be appropriately increased in proportion to such increase of outstanding
shares.
8.3 Combination or Reverse Split of Shares. If the number of shares of
Common Stock outstanding at any time after the date hereof is decreased by a
combination of, or a reverse split affecting, the outstanding shares of Common
Stock, the Warrant Price shall be appropriately increased and the number of
Shares shall be appropriately decreased in proportion to such decrease
in outstanding shares.
8.4 No Adjustment. No adjustment in the number of Shares purchasable
pursuant to the Warrants shall be required unless such adjustment would require
an increase or decrease of at least one percent in the number of Shares then
purchasable upon the exercise of the Warrants or, if the Warrants are not then
exercisable, the number of Shares purchasable upon the exercise of the Warrants
on the first date thereafter that the Warrants become exercisable; provided,
however, that any adjustments which by reason of this subsection 8.4 are not
required to be made immediately shall be carried forward and taken into account
in any subsequent adjustment.
8.5 Notice of Adjustment. Whenever the number of Shares purchasable upon
the exercise of the Warrants is adjusted as herein provided, the Company shall
cause to be promptly mailed to the Warrantholder by first class mail, postage
prepaid, notice of such adjustment and a certificate of the chief financial
officer of the Company setting forth the number of Shares purchasable upon the
exercise of the Warrants and the Warrant Price after such adjustment, a brief
statement of the facts requiring such adjustment and the computation by which
such adjustment was made.
Section 9. Fractional Interests; Current Market Price. The Company shall
not be required to issue fractional Shares on the exercise of the Warrants. If
any fraction of a Share would, except for the provisions of this Section 9, be
issuable on the exercise of the Warrants (or specified portion thereof), the
Company shall pay an amount in cash equal to the then Current Market Price
multiplied by such fraction. For purposes of this Agreement, the term, "Current
Market Price" shall mean the average of the per share closing bid prices of the
Company's Common Stock quoted in the Over-the-Counter Market summary or the
average of the per share closing prices quoted on the Nasdaq National Market or
on any exchange on which the Common Stock is listed, whichever is applicable, as
published in the Western Edition of the Wall Street Journal (or, if not so
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reported, as otherwise reported by the Nasdaq System) for five (5) trading days
prior to the date notice of exercise is given to the Company. If trading in the
Common Stock is not reported by the Nasdaq system, the bid price referred to
above shall be the average of the lowest bid price for five (5) trading days as
reported in the "pink sheets" published by the National Quotation Bureau,
Incorporated. If the Common Stock is quoted on the Nasdaq National Market or
listed on any exchange, the closing price referred to above shall be the last
reported sales price or, in case no such reported sale takes place on such day,
the average of the reported closing bid and asked prices.
Section 10. No Rights as Stockholder; Notices to Warrantholders.
Nothing contained in this Agreement or in the Warrants shall be construed as
conferring upon the Warrantholder or its respective transferees any rights as a
stockholder of the Company, including the right to vote, receive dividends,
consent or receive notices as a stockholder in respect of any meeting of
stockholders for the election of directors of the Company or any other matter.
If, however, at any time prior to the expiration of the Warrants and prior to
their exercise, any one or more of the following events shall occur:
(a) any action which would require an adjustment pursuant to Section 8;
or
(b) a dissolution, liquidation or winding up of the Company (other than
in connection with a consolidation, merger or sale of its property, assets and
business as an entirety or substantially as an entirety) shall be proposed:
then the Company shall give notice in writing of such event to the
Warrantholder, as provided in Section 14 hereof, at least 20 days prior to the
date fixed as a record date or the date of closing the transfer books for the
determination of the stockholders entitled to any relevant dividend,
distribution, subscription rights or other rights or for the determination of
stockholders entitled to vote on such proposed dissolution, liquidation or
winding up. Such notice shall specify such record date or the date of closing
the transfer books, as the case may be. The failure to mail or receive such
notice or any defect therein shall not affect the validity of any action taken
with respect thereto.
Section 11. Registration Rights.
11.1 Company Registration. If the Company shall determine to register
any of its securities either for its own account or the account of security
holders of the Company on a registration statement on form X-0, X-0, X-0, XX-0
or SB-2, the Company will (i) promptly give to each Warrantholder and each
holder of Shares, at their respective addresses as they appear on the records of
the Company, written notice thereof and (ii) use its best efforts to include in
such registration (and any related qualification under blue sky laws or other
compliance), and in any underwriting involved therein, all the Shares specified
in a written request made by any Warrantholder or holder of Shares within thirty
(30) days after delivery of the written notice from the Company. Such written
request may specify some or all of a Warrantholder's Shares. The Company shall
be obligated to include such Shares in the registration only for the seven year
period ending October __, 2003.
11.2 Underwriting. If the registration of which the Company gives
notice is for a registered public offering involving an underwriting, the
Company shall so advise the Warrantholder or holder of Shares as a part of the
written notice given. In such event the right of any Warrantholder or holder of
Shares to registration pursuant to Section 11.1 shall be conditioned upon such
Warrantholder's or holder of Shares participation in such underwriting and the
inclusion of such Warrantholder's (or holder of Shares) Shares in the
underwriting to the extent provided herein.
11.3 Request for Registration. In addition to any registration
statement filed pursuant to Section 11.1 above, during the four-year period
beginning on October __, 1997 and ending on October __, 2001, the Company will,
as promptly as practicable (but in any event within 60 days), after written
request (the "Request") by the Warrantholder, or by a person or persons holding
(or having the right to acquire by virtue of holding the Warrants) at least 50%
of the Shares which have been (or may be) issued upon exercise of the Warrants,
prepare and file at its own expense a registration statement with the Commission
and appropriate Blue Sky authorities sufficient to permit the public offering of
the Shares and will use its best efforts at its own expense through its
officers, directors, auditors and counsel, in all matters necessary or
advisable, to cause such registration statement to become effective as promptly
as practicable and to maintain such effectiveness so as to permit resale of the
Shares covered by the Request until the earlier of the time that all such Shares
have been sold or the expiration of ninety (90) days from the effective date of
the Registration Statement (the "Minimum Period"). The Company shall be
obligated to file and have declared effective a total of only one registration
statement pursuant to a Request hereunder.
11.4 Expenses. All fees, disbursements and out-of-pocket expenses in
connection with the filing of any registration statement under this Section 11
(or obtaining the opinion of counsel and any no-action position of the
Commission with respect to sales under Rule 144) and in complying with
applicable securities and Blue Sky laws shall be borne by the Company including
reasonable fees of one counsel for the Warrantholder or holder of Shares. The
Company at its expense will supply any Warrantholder and any holder of Shares
with copies of such registration statement and the prospectus included therein
and other related documents, and any opinions and no-action letters in such
quantities as may be reasonably requested by the Warrantholder or holder of
Shares.
11.5 The Company agrees that until all Shares have been sold under a
registration statement or pursuant to Rule 144 under the Act, it will keep
current in filing all materials required to be filed with the Commission in
order to permit the holders of such securities to sell the same under Rule 144.
Section 12. Indemnification.
12.1 In the event of the filing of any registration statement with
respect to the Shares pursuant to Section 11 hereof, the Company will indemnify
the Warrantholder, its officers, directors and partners, legal counsel and
accountants and each person controlling such Warrantholder within the meaning of
Section 15 of the Act, with respect to which registration, qualification or
compliance has been effected pursuant to Section 11 hereof, against all
expenses, claims, losses, damages and liabilities (or actions, proceedings or
settlements in respect thereof) arising out of or based on any untrue statement
(or alleged untrue statement) of a material fact contained in any prospectus,
offering circular or other document (including any related registration
statement, notification or the like) incident to any such registration,
qualification or compliance, or based on any omission (or alleged omission) to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, or any violation by the Company of the
Act or any rule or regulation thereunder applicable to the Company and relating
to action or inaction required of the Company in connection with any such
registration, qualification or compliance, and will reimburse such
Warrantholder, its officers, directors, partners, legal counsel and accountants
and each person controlling such Warrantholder, for any legal and any other
expenses reasonably incurred in connection with investigating and defending or
settling any such claim, loss, damage, liability or action, provided that the
Company will not be liable in any such case to the extent that any such claim,
loss, damage, liability or expense arises out of or is based on any untrue
statement or omission based upon written information furnished to the Company by
the Warrantholder and stated to be specifically for use therein.
12.2 The Warrantholder will, if Shares held by it are included in the
securities as to which such registration, qualification or compliance is being
effected, indemnify the Company, each of its directors, officers, partners,
legal counsel and accountants against all claims, losses, damages and
liabilities (or actions, proceedings or settlements in respect thereof)
arising out of or based on any untrue statement (or
alleged untrue statement) of a material fact contained in any such registration
statement, prospectus, offering circular or other document, or any omission (or
alleged omission) to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and will reimburse
the Company, its directors, officers, partners, legal counsel and accountants,
for any legal or any other expenses reasonably incurred in connection with
investigating or defending any such claim, loss, damage, liability or action, in
each case to the extent, but only to the extent, that such untrue statement (or
alleged untrue statement) or omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document in
reliance upon and in conformity with written information furnished to the
Company by the Warrantholder; provided, however, that the obligations of the
Warrantholder hereunder shall not apply to amounts paid in settlement of any
such claims, losses, damages or liabilities (or actions in respect thereof) if
such settlement is effected without the consent of the Warrantholder (which
consent shall not be unreasonably withheld).
12.3 Each party entitled to indemnification under this Section 12 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or any litigation resulting
therefrom, shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld), and the Indemnified Party may participate in such
defense at such party's expense, and provided further that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 12, to the extent such
failure is not prejudicial. No Indemnifying Party, in the defense of any such
claim or litigation, shall, except with the consent of each Indemnified Party,
consent to entry of any judgment or enter into any settlement which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party of a release from all liability in respect to such
claim or litigation. Each Indemnified Party shall furnish such information
regarding itself or the claim in question as an Indemnifying Party may
reasonably request in writing and as shall be reasonably required in connection
with defense of such claim and litigation resulting therefrom.
Section 13. Contribution. If the indemnification provided for in Section
12 is held by a court of competent jurisdiction to be unavailable to an
Indemnified Party with respect to any loss, liability, claim, damage or expense
referred to therein, then the Indemnifying Party, in lieu of indemnifying such
Indemnified Party hereunder, shall contribute to the amount paid or payable by
such Indemnified Party as a result of such loss, liability, claim, damage or
expense in such proportion as is appropriate to reflect the relative fault of
the Indemnifying Party on the one hand and of the Indemnified Party on the other
in connection with the statements or omissions which resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations. The relative fault of the Indemnifying Party and of the
Indemnified Party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
Indemnifying Party or by the Indemnified Party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
Section 14. Notices. Any notice pursuant to this Agreement by the
Company or by a Warrantholder or a holder of Shares shall be in writing and
shall be deemed to have been duly given on the date of delivery or refusal
indicated on the return receipt if delivered or mailed by certified mail,
return receipt requested:
(a) If to the Warrantholder or a holder of Shares addressed to
Meridian Capital Group, Inc., 0000 XxxXxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx Xxxxx,
Xxxxxxxxxx 00000, Attention: Mr. Xxxxx Xxxxxxx.
(b) If to the Company addressed to it at 0000X Xxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxx 00000, Attention: President.
Each party may from time to time change the address to which notices to it are
to be delivered or mailed hereunder by notice in accordance herewith to the
other party.
Section 15. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company, the Warrantholder, or the
holders of Shares shall bind and inure to the benefit of their respective
successors and assigns hereunder.
Section 16. Merger or Consolidation of the Company. The Company will not
merge or consolidate with or into any other corporation or sell all or
substantially all of its property to another corporation, unless the provisions
of Section 8 are complied with.
Section 17. Applicable Law. This Agreement shall be deemed to be a
contract made under the laws of the State of California and for all purposes
shall be construed in accordance with the laws of said State.
Section 18. Benefits of this Agreement. Nothing in this Agreement shall
be construed to give to any person or corporation other than the Company, the
Warrantholder and the holders of Shares any legal or equitable right, remedy or
claim under this Agreement. This Agreement shall be for the sole and exclusive
benefit of the Company, the Warrantholder and the holders of Shares.
Section 19. Amendments. This Agreement may be amended only by a written
instrument executed by duly authorized representatives of the Company and the
Warrantholder.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed, all as of the day and year first above written.
JAVELIN SYSTEMS, INC.
By:
Name: Xxxxxxx X. Xxxxx
Title: President
MERIDIAN CAPITAL GROUP, INC.
By:
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Chief Executive Officer
Exhibit A
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS
AND MAY NOT BE SOLD, EXCHANGED, HYPOTHECATED OR TRANSFERRED IN ANY MANNER EXCEPT
PURSUANT TO A REGISTRATION OR AN EXEMPTION FROM SUCH REGISTRATION AND IN
COMPLIANCE WITH THE AGREEMENT PURSUANT
TO WHICH THEY WERE ISSUED
Warrant Certificate No. ______
UNDERWRITER'S WARRANT TO PURCHASE 85,000 SHARES
OF COMMON STOCK
VOID AFTER 5:00 P.M.
PACIFIC TIME ON OCTOBER __, 2001
JAVELIN SYSTEMS, INC.
INCORPORATED UNDER THE LAWS
OF THE STATE OF DELAWARE
This certifies that, for value received, Meridian Capital Group, Inc., the
registered holder hereof or assigns ("Warrantholder"), is entitled to purchase
from JAVELIN SYSTEMS, INC. (the "Company"), at any time during the period
commencing at 9:00 a.m., Pacific Time, on October __, 1997, and before 5:00
p.m., Pacific Time, October __, 2001 at the purchase price per share of $6.25
(the "Warrant Price"), the number of Shares of Common Stock of the Company set
forth above (the "Shares"). The number of Shares issuable upon exercise of each
Warrant evidenced hereby and the Warrant Price shall be subject to adjustment
from time to time as set forth in the Underwriter's Warrant Agreement referred
to below.
The Warrants evidenced hereby may be exercised in whole or in part by
presentation of this Warrant Certificate with the Purchase Form attached hereto
duly executed (with a signature guarantee as provided thereon) and simultaneous
payment of the Warrant Price at the principal office of the Company pursuant to
the terms of the Underwriter's Warrant Agreement.
The Warrant evidenced hereby represent the right to purchase an
aggregate of up to 85,000 Shares, subject to certain adjustments, and are issued
under and in accordance with a Underwriter's Warrant Agreement, dated as of
October __, 1996 (the "Underwriter's Warrant Agreement"), between the Company
and Meridian Capital Group, Inc. and are subject to the terms and provisions
contained in the Underwriter's Warrant Agreement, to all of which the
Warrantholder by acceptance hereof consents.
Upon any partial exercise of the Warrants evidenced hereby, there shall be
signed and issued
to the Warrantholder a new Warrant Certificate in respect of the Shares of
Common Stock as to which the Warrants evidenced hereby shall not have been
exercised. These Warrants may be exchanged at the office of the Company by
surrender of this Warrant Certificate properly endorsed for one or more new
Warrants of the same aggregate number of Shares of Common Stock as evidenced by
the Warrant or Warrants exchanged. No fractional Shares of Common Stock will be
issued upon the exercise of rights to purchase hereunder, but the Company shall
pay the cash value of any fraction upon the exercise of one or more Warrants.
These Warrants are transferable at the office of the Company in the manner and
subject to the limitations set forth in the Underwriter's Warrant Agreement.
This Warrant Certificate does not entitle any Warrantholder to any of the
rights of a stockholder of the Company.
JAVELIN SYSTEMS, INC.
By: _____________________________
Dated: October __, 1996
JAVELIN SYSTEMS, INC.
PURCHASE FORM
JAVELIN SYSTEMS, INC.
0000X Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxx 00000
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant Certificate for, and to purchase
thereunder, ____________________ Shares of Common Stock (the "Shares") provided
for therein, and requests that certificates for the Shares be issued in the name
of:
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(Please Print or Type Name)
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(Address, including zip code)
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(Social Security No. or Tax I.D. No.)
and, if said number of Shares shall not be all the Shares purchasable hereunder,
that a new Warrant Certificate for the balance of the Shares purchasable under
the Warrant Certificate be registered in the name of the undersigned
Warrantholder or his Assignee as below indicated and delivered to the address
stated below.
Name of Warrantholder
or Assignee:
-------------------------------------------------------------
(Please Print)
Address:
-----------------------------------------------------------------
Signature: Dated:
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Note: The signature on this purchase must correspond with the name as it
appears upon the face of the within Warrant Certificate in every particular,
without alteration or enlargement or any change whatever.
Signature Guaranteed:
------------------------------------------
(Signature must be guaranteed by a bank or trust company having an
office or correspondent in the United States or by a member firm of a
registered securities exchange or the National Association of
Securities Dealers, Inc.)
ASSIGNMENT
(To be signed only upon assignment of Warrants)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
the assignee named below all of the rights of the undersigned represented by the
attached Warrant with respect to the number of Shares covered by the Warrant set
forth below:
(Name and Address of Assignee Must Be Printed or Typewritten)
Social Security No. No. of
Name of Assignee or Tax I.D. No. Address Shares
---------------- ------------------- -------------------- ------
--------------------
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and does hereby irrevocably constitute and appoint
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Attorney to transfer said Warrants on the books of the Company, with full power
of substitution in the premises.
Dated:
------------------------- ------------------------------
Signature of Registered Holder
Note: The signature on this assignment must correspond with the names as it
appears upon the face of the within Warrant Certificate in every
particular, without alteration or enlargement or any change whatever.
Signature Guaranteed:
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(Signature must be guaranteed by a bank or trust company having an
office or correspondent in the United States or by a member firm of a
registered securities exchange or the National Association of Securities
Dealers, Inc.)
SCHEDULE I
Initial Distribution of Warrants
--------------------------------
Name Amount
---- ------
Meridian Capital Group, Inc. 100%
Total 100%
