EXHIBIT 4.3
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VOID AFTER 5:00 P.M. NEW YORK CITY
TIME ON AUGUST 26, 2004
THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER JURISDICTION. THE SECURITIES REPRESENTED HEREBY MAY
NOT BE OFFERED OR SOLD IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS OR UNLESS
OFFERED, SOLD OR TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THOSE LAWS.
Right to Purchase ________ Common Units
of Xxxxxxxx.xxx, LLC owned by e4L, Inc.
Date: August 27, 1999
STOCK PURCHASE WARRANT
THIS CERTIFIES THAT, for value received, _____________________ or its
registered assigns, is entitled to purchase from e4L, INC., a corporation
organized under the laws of the State of Delaware (the "COMPANY"), at any time
or from time to time during the period specified in Section 2 hereof,
________________________________ (____) common units (the "WARRANT SHARES") of
Xxxxxxxx.xxx, LLC ("BUYITNOW") at an exercise price per share (the "EXERCISE
PRICE") equal to the greater of (i) $5.00 or (ii) the price per share at which
Buyitnow receives equity financing of at least an aggregate of $10,000,000. The
number of Warrant Shares and the Exercise Price are subject to adjustment as
provided in Section 4 hereof. The term "WARRANTS" means this Warrant and the
other warrants of the Company to purchase common units of Buyitnow issued
pursuant to that certain Securities Purchase Agreement, dated as of the date
hereof, by and among the Company and the other signatories thereto (the
"SECURITIES PURCHASE AGREEMENT"). In addition, the holder of this Warrant has
certain rights as set forth in Section 8 hereof in the event of a change of
control of Buyitnow.
This Warrant is subject to the following terms, provisions, and
conditions:
1. MANNER OF EXERCISE; ISSUANCE OF CERTIFICATES; PAYMENT FOR SHARES.
Subject to the provisions hereof, including, without limitation, the limitations
contained in Section 4 hereof, this Warrant may be exercised by the holder
hereof, in whole or in part, by the surrender of this Warrant, together with a
completed exercise agreement in the form attached hereto (the "EXERCISE
AGREEMENT"), to the Company during normal business hours on any business day at
the Company's principal executive offices (or such
other office or agency of the Company as it may designate by notice to the
holder hereof), and upon payment to the Company in cash, by certified or
official bank check or by wire transfer for the account of the Company, of the
Exercise Price for the Warrant Shares specified in the Exercise Agreement. The
Warrant Shares so purchased shall be deemed to be sold to the holder hereof as
of the close of business on the date on which this Warrant shall have been
surrendered, the completed Exercise Agreement shall have been delivered, and
payment shall have been made for such shares as set forth above or, if such date
is not a business date, on the next succeeding business date. The Company shall
use its best efforts to deliver the certificates for the Warrant Shares so
purchased within a reasonable time after this Warrant shall have been so
exercised. If this Warrant shall have been exercised only in part, then, unless
this Warrant has expired, the Company shall, at its expense, at the time of
delivery of such certificates, deliver to the holder a new Warrant representing
the number of shares with respect to which this Warrant shall not then have been
exercised.
2. PERIOD OF EXERCISE.
(a) This Warrant is exercisable, at any time or from time to
time during the period (the "EXERCISE PERIOD") beginning on the 180th day after
the closing of an initial public offering of Buyitnow, and ending at 5:00 p.m.,
New York City time on, August 26, 2004 (the "EXPIRATION DATE").
3. ANTIDILUTION PROVISION. The Exercise Price and the number of
Warrant Shares which may be purchased hereunder shall be subject to adjustment
from time to time as provided in this Section 3.
(a) SUBDIVISION OR COMBINATION OF COMMON STOCK. If Buyitnow at
any time after the date of the initial issuance of this Warrant (the "ISSUE
DATE"), subdivides (by any stock split, stock dividend, recapitalization,
reorganization, reclassification or otherwise) its common units into a greater
number of shares, then, after the date of record for effecting such subdivision,
the Exercise Price in effect immediately prior to such subdivision will be
proportionately reduced. If Buyitnow, at any time after the Issue Date, combines
(by reverse stock split, recapitalization, reorganization, reclassification or
otherwise) its common units into a smaller number of shares, then, after the
date of record for effecting such combination, the Exercise Price in effect
immediately prior to such combination will be proportionately increased.
4. TRANSFER AND REPLACEMENT OF WARRANT.
(a) RESTRICTION ON TRANSFER. This Warrant and the rights
granted to the holder hereof are transferable, in whole or in part, upon
surrender of this Warrant, together with a properly executed assignment in the
form attached hereto, at the office or agency of the Company referred to in
Section 5 below, PROVIDED, HOWEVER, that any transfer or assignment shall be
subject to the conditions set forth in Section 4(d) hereof and to the provisions
of Sections 2(f) and 2(g) of the Securities Purchase Agreement. Until due
presentment for transfer on the books of the Company, the Company may treat the
registered holder hereof as the owner and holder hereof for all purposes, and
the Company shall not be affected by any notice to the contrary.
(b) REPLACEMENT OF WARRANT. Upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction, or
mutilation of this Warrant and, in the case of any such loss, theft, or
destruction, upon delivery of an indemnity agreement reasonably satisfactory in
form and amount to the Company, or, in the case of any such mutilation, upon
surrender and cancellation of this Warrant, the Company, at its expense, will
execute and deliver, in lieu thereof, a new Warrant of like tenor.
(c) CANCELLATION. Upon the surrender of this Warrant in
connection with any transfer or replacement as provided in this Section 4, this
Warrant shall be promptly canceled by the Company.
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(d) EXERCISE OR TRANSFER WITHOUT REGISTRATION. If, at the time
of the surrender of this Warrant in connection with any exercise, transfer, or
exchange of this Warrant, this Warrant (or, in the case of any exercise, the
Warrant Shares issuable hereunder), shall not be registered under the Securities
Act and under applicable state securities or blue sky laws, the Company may
require, as a condition of allowing such exercise, transfer, or exchange, (i)
that the holder or transferee of this Warrant, as the case may be, furnish to
the Company a written opinion of counsel (which opinion shall be in form,
substance and scope customary for opinions of counsel in comparable
transactions) to the effect that such exercise, transfer, or exchange may be
made without registration under the Securities Act and under applicable state
securities or blue sky laws, (ii) that the holder or transferee execute and
deliver to the Company an investment letter in form and substance acceptable to
the Company and (iii) that the transferee be an "ACCREDITED INVESTOR" as defined
in Rule 501(a) promulgated under the Securities Act; PROVIDED that no such
opinion, letter, status as an "accredited investor" shall be required in
connection with a transfer pursuant to Rule 144 under the Securities Act.
5. NOTICES. Any notices required or permitted to be given under the
terms of this Warrant shall be sent by certified or registered mail (return
receipt requested) or delivered personally or by courier or by confirmed
telecopy, and shall be effective five days after being placed in the mail, if
mailed, or upon receipt or refusal of receipt, if delivered personally or by
courier, or by confirmed telecopy, in each case addressed to a party. The
addresses for such communications shall be:
If to the Company:
e4L, Inc.
00000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxxx
with a copy to:
Xxxxx, Xxxxxxxx, Xxxxxx, Xxxxxxxxx & Xxxxxx LLP
000 X. Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxxxx, III, Esquire
If to the holder, at such address as such holder shall have provided in writing
to the Company, or at such other address as such holder furnishes by notice
given in accordance with this Section 9.
6. GOVERNING LAW. This Warrant shall be governed by and construed in
accordance with the laws of the State of Delaware applicable to contracts made
and to be performed in the State of Delaware.
7. MISCELLANEOUS.
(a) AMENDMENTS. This Warrant and any provision hereof may only
be amended by an instrument in writing signed by the Company and the holder
hereof.
(b) DESCRIPTIVE HEADINGS. The descriptive headings of the
several Sections of this Warrant are inserted for purposes of reference only,
and shall not affect the meaning or construction of any of the provisions
hereof.
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(c) BUSINESS DAY. For purposes of this Warrant, the term
"business day" means any day, other than a Saturday or Sunday or a day on which
banking institutions in the State of New York are authorized or obligated by
law, regulation or executive order to close.
8. SALE OF BUYITNOW.
(a) PAYMENT BY THE COMPANY. So long as the Exercise Period
shall not have commenced, in case of any consolidation of Buyitnow with, or
merger of Buyitnow into any other corporation, or in case of any sale or
conveyance of all of the outstanding units of Buyitnow or all or substantially
all of its assets other than in connection with a plan of complete liquidation
of Buyitnow (collectively, a "CHANGE OF CONTROL TRANSACTION") at any time after
the third (3rd) anniversary of the Issue Date and prior to the Expiration Date,
the Company shall pay to the holder of this Warrant pursuant to and in
accordance with Section 8(b), an amount of cash or other consideration (the
"BUYITNOW BUYOUT PAYMENT") determined in accordance with the following formula:
B = W x ( (C / N) - E)
Where:
B = The amount of the Buyitnow Buyout Payment, which payment
shall be in the same form (i.e., cash or non-cash) as the
consideration which the Company receives for its Buyitnow
common units pursuant to the Change of Control Transaction.
W = The number of Warrant Shares issuable upon exercise of this
Warrant on the date of consummation of the Change of Control
Transaction.
C = The Value (as defined below) of the consideration received
by the Company in the Change of Control Transaction.
N = The number of common units of Buyitnow held by the Company
immediately prior to the consummation of the Change of Control
Transaction.
E = The Exercise Price of this Warrant on the date of
consummation of the Change of Control Transaction.
(b) BUYITNOW BUYOUT PAYMENT. Within ten (10) business days
after the consummation of a Change of Control Transaction, the Company shall
provide written notice (the "BUYOUT NOTICE") to the holder of this Warrant
stating that a Change of Control Transaction has occurred, along with a
calculation of the amount of the payment (and the form of the consideration
thereof) which the holder of this Warrant may receive. If the holder of this
Warrant desires to receive such payment, such holder shall submit to the
Company, within ten (10) business days after receipt of the Buyout Notice, this
Warrant and a written notice which indicates that the holder of this Warrant
desires to receive the Buyitnow Buyout Payment. Subject to any applicable time
and/or other restrictions imposed upon the Company by the documents relating to
the Change of Control Transaction, the Company shall pay the Buyitnow Buyout
Payment to the holder of this Warrant within ten (10) business days after
receipt of this Warrant, the aforementioned notice and the receipt by the
Company of the full consideration which the Company is entitled to receive in
connection with the Change of Control Transaction.
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(c) STATUS OF WARRANT. Upon tender of this Warrant in
accordance with Section 8(b), this Warrant shall be null and void and of no
further force and effect, except as to the right of the holder to receive the
Buyitnow Buyout Payment.
(d) DEFINITIONS. For purposes of this Section 8,
"VALUE" means (i) with respect to cash, the amount thereof
and (ii) with respect to consideration other than cash, the fair market value of
such consideration, except where such consideration consists of securities, in
which case the amount of consideration will be the Market Price thereof as of
the date of the consummation of the Change of Control Transaction. The fair
market value of any consideration other than cash or securities will be
determined in good faith by an investment banker or other appropriate expert of
national reputation selected by the Company and reasonably acceptable to the
holder hereof, with the costs of such appraisal to be borne by the Company.
"MARKET PRICE" means the volume weighted average sale
prices on the principal trading market for a security for the trading day
immediately preceding the date of the consummation of the Change of Control
Transaction, or, if the Market Price cannot be calculated as of such date on the
foregoing basis, the Market Price shall be the fair market value as reasonably
determined by an investment banking firm selected by the Company and reasonably
acceptable to the holder hereof, with the costs of such appraisal to be borne by
the Company.
9. ASSIGNMENT OF REGISTRATION RIGHTS. The Company hereby assigns to the
holder of this Warrant all of its rights with respect to the registration of all
Warrant Shares for which this Warrant may be exercised (which rights are set
forth in the Registration Rights Agreement, dated as of June 7, 1999, among
XxxXxXxx.xxx L.L.C., e4L, Inc. and BuyItNow, Inc. (the "Buyitnow Registration
Rights Agreement"), a copy of which is attached hereto as Exhibit A; provided
that the holder of this Warrant assumes the Company's obligations in respect of
the Warrant Shares set forth in the Buyitnow Registration Rights Agreement.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer.
E4L, INC.
By:
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Name:
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Title:
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FORM OF EXERCISE AGREEMENT
(TO BE EXECUTED BY THE HOLDER IN ORDER TO EXERCISE THE WARRANT)
To: e4L, Inc.
00000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxxx
The undersigned hereby irrevocably exercises the right to purchase
_____________ common units of Xxxxxxxx.xxx, LLC, evidenced by the attached
Warrant, and herewith makes payment of the Exercise Price with respect to such
shares in full, all in accordance with the conditions and provisions of said
Warrant.
(i) The undersigned agrees not to offer, sell, transfer or otherwise
dispose of any Common Stock obtained on exercise of the Warrant, except under
circumstances that will not result in a violation of the Securities Act of 1933,
as amended, or any state securities laws, and agrees that the following legend
may be affixed to the stock certificate for the Common Stock hereby subscribed
for if resale of such Common Stock is not registered or if Rule 144 is
unavailable:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR THE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES. THE SECURITIES REPRESENTED HEREBY MAY
NOT BE OFFERED OR SOLD IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS OR UNLESS
OFFERED, SOLD OR TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THOSE LAWS.
(ii) The undersigned hereby assumes the Company's obligations under the
Buyitnow Registration Rights Agreement in respect of the Warrant Shares.
(iii) The undersigned requests that stock certificates for such shares
be issued, and a Warrant representing any unexercised portion hereof be issued,
pursuant to the Warrant in the name of the Holder and delivered to the
undersigned at the address set forth below:
Dated:
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Signature of Holder
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Name of Holder (Print)
Address:
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FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and
transfers all the rights of the undersigned under the within Warrant, with
respect to the number of shares of Common Stock covered thereby set forth
hereinbelow, to:
NAME OF ASSIGNEE ADDRESS NO OF SHARES
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, and hereby irrevocably constitutes and appoints ______________
________________________ as agent and attorney-in-fact to transfer said Warrant
on the books of the within-named corporation, with full power of substitution in
the premises.
Dated: _____________________, ____,
In the presence of
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Name:
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Signature:
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Title of Signing Officer or Agent (if any):
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Address:
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Note: The above signature should correspond
exactly with the name on the face of the
within Warrant.
