THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD OR
TRANSFERRED UNLESS SUCH SALE OR TRANSFER IS IN ACCORDANCE WITH THE REGISTRATION
REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS OR SOME OTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS IS AVAILABLE WITH
RESPECT THERETO.
WARRANT
September 12, 2000 Number of Shares: 1,071,428
XXX.XXX, INC.
Void after September 12, 2005
1. Issuance. This Warrant is issued to Sapient Corporation, a Delaware
corporation ("Sapient") by XXX.XXX, Inc., a Delaware corporation (hereinafter
with its successors called the "Company") pursuant to that certain Amendment No.
1 dated as of September 7, 2000 entered into in connection with the Master
Professional Services Agreement dated as of May 22, 2000 by and between the
Company and Sapient (the Amendment and the Master Professional Services
Agreement referred to collectively as the "Services Contract").
2. Purchase Price; Number of Shares. Subject to the terms and
conditions hereinafter set forth, the registered holder of this Warrant (the
"Holder"), commencing on the date hereof, is entitled, upon surrender of this
Warrant with the subscription form attached hereto or such other form reasonably
acceptable to the Company duly executed, at the office of the Company, or such
other location as the Company shall notify the Holder of in writing, to purchase
from the Company at a price of $2.25 per share (the "Purchase Price"), One
Million Seventy One Thousand Four Hundred Twenty Eight (1,071,428) shares of
common stock of the Company (the "Shares"). Until such time as this Warrant is
exercised in full or expires, the Purchase Price and the Shares issuable upon
exercise of this Warrant are subject to adjustment as hereinafter provided.
3. Payment of Purchase Price; Net Issuance; Condition to Exercise.
--------------------------------------------------------------
(a) The Purchase Price shall be payable in cash by delivery of
immediately available funds in the form delivery of a certified check or by wire
transfer to such account designated by the Company.
(b) "Cashless Exercise:" Notwithstanding any provisions herein to the
contrary, if, at the time of exercise of this Warrant, the Company's common
stock is listed and is trading on the NASDAQ National Market or any other NASDAQ
market and the fair market value (as determined by the closing price of one
share of the Company's common stock at the close of regular trading on the
immediately preceding trading day) of one share of the Company's common stock is
greater than the applicable Purchase Price per share under this Warrant, in lieu
of paying cash upon exercise of this Warrant, the holder may elect to receive
the number of shares of common stock of the Company computed using the following
formula:
X = Y(A-B)
------
A
Where X = the number of shares of common stock to be issued to the holder;
Y = the number of shares of common stock with respect to which this
Warrant is being exercised;
A = the fair market value of one share of the Company's common stock;
and
B = then applicable per share Purchase Price under this Warrant
(c) The Holder of this Warrant shall be entitled to exercise this
Warrant to purchase Shares in part or in full at any time or from time to time
upon achievement of the "Live" or "Launch" Date, as defined in the Services
Contract (the "Delivery Date"). Prior to the Delivery Date, the Holder shall
have no right to purchase the Shares covered by this Warrant.
4. Partial Exercise. This Warrant may be exercised in part, and the
Holder shall be entitled to receive a new warrant, which shall be dated as of
the date of this Warrant, covering the number of Shares in respect of which this
Warrant shall not have been exercised.
5. Issuance Date. The person or persons in whose name or names any
certificate representing Shares is issued hereunder shall be deemed to have
become the holder of record of the Shares represented thereby as at the close of
business on the date this Warrant is exercised with respect to such Shares,
whether or not the transfer books of the Company shall be closed.
6. Expiration Date. This Warrant shall expire at the close of business
on September 12, 2005, and shall be void thereafter.
7. Reserved Shares; Valid Issuance. The Company covenants that it will
at all times from and after the date hereof reserve and keep available such
number of its authorized shares of
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common stock, free from all preemptive or similar rights therein, as will be
sufficient to permit the exercise of this Warrant in full. The Company further
covenants that any Shares that may be issued pursuant to the exercise of this
Warrant will, upon issuance, be duly and validly issued, fully paid and
nonassessable and free from all taxes, liens and charges with respect to the
issuance thereof. The Company represents that when the Shares are issued the
Shares will not be subject to any restriction other than any restriction
required by securities laws.
8. Dividends. If at any time during the term of this Warrant, the
Company shall subdivide the Shares, by split-up or otherwise, or combine the
Shares, or issue additional Shares in payment of a dividend on the Shares, or
any similar transaction affecting the Shares, the number of Shares issuable on
the exercise of this Warrant shall forthwith be proportionately increased in the
case of a subdivision or dividend, or proportionately decreased in the case of a
combination, and the Purchase Price shall forthwith be proportionately decreased
in the case of a subdivision or dividend, or proportionately increased in the
case of a combination.
9. Mergers and Reclassifications. If at any time during the term of
this Warrant there shall be any reclassification, capital reorganization or
change of the Shares (other than as a result of a subdivision, combination or
dividend provided for in Section 8 hereof), or any consolidation of the Company
with, or merger of the Company into, another corporation or other business
organization (other than a consolidation or merger in which the Company is the
continuing corporation and which does not result in any reclassification or
change of the outstanding Shares), or any sale or conveyance to another
corporation or other business organization of all or substantially all of the
assets of the Company, then, as a condition of such reclassification,
reorganization, change, consolidation, merger, sale or conveyance, lawful
provisions shall be made, and duly executed documents evidencing the same from
the Company or its successor shall be delivered to the Holder, so that the
Holder shall thereafter have the right to purchase, at a total price not to
exceed that payable upon the exercise of this Warrant in full, the kind and
amount of shares of stock and other securities and property receivable upon such
reclassification, reorganization, change, consolidation, merger, sale or
conveyance by a holder of the number of Shares which might have been purchased
by the Holder immediately prior to such reclassification, reorganization,
change, consolidation, merger, sale or conveyance, and in any such case
appropriate provisions shall be made with respect to the rights and interest of
the Holder to the end that the provisions hereof (including without limitation,
provisions for the adjustment of the Purchase Price and the number of Shares
issuable hereunder) shall thereafter be applicable in relation to any shares of
stock or other securities and property thereafter deliverable upon exercise
hereof.
10. Fractional Units. In no event shall any fractional Shares be issued
upon any exercise of this Warrant. If, upon exercise of this Warrant in its
entirety, the Holder would, except as provided in this Section 10, be entitled
to receive any fractional Shares, then the Company shall issue the next higher
number of full Shares, issuing a full Share with respect to such fractional
Share.
11. Notice of Adjustment. Whenever the Purchase Price is adjusted, as
herein provided, the Company shall promptly deliver to the Holder a notice
setting forth the Purchase
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Price after such adjustment and setting forth a brief statement of the facts
requiring such adjustment.
12. Notices of Record Date, Etc. In the event of:
(a) any taking by the Company of a record of the holders of
any class of securities for the purpose of determining the holders thereof who
are entitled to receive any dividend or other distribution, or any right to
subscribe for, purchase or otherwise acquire any Shares or any other securities
or property, or to receive any other right,
(b) any reclassification of the capital structure of the
Company, capital reorganization of the Company, consolidation or merger
involving the Company, or sale or conveyance of all or substantially all of its
assets, or
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company,
then and in each such event the Company will mail or cause to
be mailed to the Holder a notice specifying (i) the date on which any such
record is to be taken for the purpose of such dividend, distribution or right,
and stating the amount and character of such dividend, distribution or right, or
(ii) the date on which any such reclassification, reorganization, consolidation,
merger, sale or conveyance, dissolution, liquidation or winding-up is to take
place, and the time, if any is to be fixed, as of which the holders of record in
respect of such event are to be determined. Such notice shall be mailed at least
20 days prior to the date specified in such notice on which any such action is
to be taken.
13. Amendment. The terms of this Warrant may be amended, modified or
waived only with the written consent of the Company and the Holder.
14. Warrant Register; Transfers, Etc.
A. The Company will maintain a register containing the names
and addresses of the registered Holder of the Warrant. The Holder may change its
address as shown on the warrant register by written notice to the Company
requesting such change. Any notice or written communication required or
permitted to be given to the Holder may be given by certified mail or delivered
to the Holder at its address as shown on the warrant register.
B. This Warrant may not be transferred by the Holder with
respect to any or all of the Shares purchasable hereunder without the express,
written consent of the Company and in compliance with applicable federal and
state securities laws other than to an affiliated company controlled by or under
common control with the Holder. If the Company consents to any such transfer,
upon surrender of this Warrant to the Company, together with the assignment
hereof properly endorsed, for transfer of this Warrant as an entirety by the
Holder, the Company shall issue a new warrant of the same denomination to the
assignee. Upon surrender of this Warrant to the Company, together with the
assignment hereof properly endorsed, by the Holder for transfer with respect to
a portion of the Shares purchasable hereunder, the Company shall issue a new
4
warrant to the assignee, in such denomination as shall be requested by the
Holder hereof, and shall issue to such Holder a new warrant covering the number
of Shares in respect of which this Warrant shall not have been transferred.
C. In case this Warrant shall be mutilated, lost, stolen or
destroyed, the Company shall issue a new warrant of like tenor and denomination
and deliver the same (i) in exchange and substitution for and upon surrender and
cancellation of any mutilated Warrant, or (ii) in lieu of any Warrant lost,
stolen or destroyed, upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft or destruction of such Warrant (including a
reasonably detailed affidavit with respect to the circumstances of any loss,
theft or destruction) and of indemnity reasonably satisfactory to the Company.
15. Governing Law. The provisions and terms of this Warrant shall be
governed by and construed in accordance with the internal laws of the State of
Delaware.
16. Successors and Assigns. This Warrant shall be binding upon the
Company's successors and assigns and shall inure to the benefit of the Holder's
successors, legal representatives and permitted assigns.
17. Business Days. If the last or appointed day for the taking of any
action required or the expiration of any right granted herein shall be a
Saturday or Sunday or a legal holiday in Boston, Massachusetts, then such action
may be taken or right may be exercised on the next succeeding day which is not a
Saturday or Sunday or such a legal holiday.
18. Registration Rights. Upon exercise of this Warrant in whole or in
part, the Holder shall be entitled to piggyback registration rights with respect
to all shares of the Company's common stock received upon exercise thereof. In
the event that the Company shall propose to register any of its shares of common
stock under the Securities Act of 1933, as amended, the Company will give prompt
written notice to the Holder of its intent to effect such registration. Upon
receipt of an election to participate in such registration by the Holder, the
Company will include in such registration all shares of common stock of the
Company which the Holder has elected to include. In the event that the Company
is reasonably unable to include all of the shares of common stock which the
Holder has elected to include, the number of shares of common stock elected to
be included shall be reduced on a pro rata basis with the other shareholders
5
whose shares are being including in such registration (other than the Company).
The costs and expenses, other than underwriting discounts and commissions with
respect to the common stock, of such registration shall be borne by the Company.
Notwithstanding the foregoing, Sapient's piggyback registration rights hereunder
shall be subordinate to those of existing security holders in the event of a
cutback in a managed public offering.
Dated: September 13, 2000 XXX.XXX, INC.
By: /s/ Xxxx Xxxxxxxxxxx
---------------------------
Xxxx Xxxxxxxxxxx
Attest: /s/ Xxxxxxxx Xxxxxxx Chief Operating Officer
--------------------
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WARRANT TO SAPIENT CORPORATION
September 12, 2000 Number of Shares: 1,071,428
SIGNATURE PAGE
Subscription
To:__________________________
Date:_________________________
The undersigned hereby subscribes for __________ Shares covered by the
Warrant dated September 12, 2000 issued by XXX.XXX, Inc. to Sapient Corporation.
The certificate(s) for such Shares shall be issued in the name of the
undersigned or as otherwise indicated below:
______________________________
Signature
______________________________
Name for Registration
______________________________
Mailing Address
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Assignment
----------
For value received ____________________________ hereby sells,
assigns and transfers unto ______________________________________
--------------------------------------------------------------------------
Please print or typewrite name and address of Assignee
-----------------------------------------------------------------
the within Warrant, and does hereby irrevocably constitute and appoint _________
its attorney to transfer the within Warrant on the books of the within named
Company with full power of substitution on the premises.
Dated:_______________________
_______________________
In the Presence of:
-----------------------------
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