WARRANT AND WARRANT AGREEMENT TO PURCHASE COMMON STOCK
OF
OBJECTSOFT CORPORATION
THESE SECURITIES AND THE SECURITIES ISSUABLE UPON THEIR EXERCISE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED UNLESS
COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT, A "NO ACTION"
LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION WITH RESPECT TO SUCH
TRANSFER, A TRANSFER MEETING THE REQUIREMENTS OF RULE 144 OF THE SECURITIES AND
EXCHANGE COMMISSION, OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER TO THE
EFFECT THAT ANY SUCH TRANSFER IS EXEMPT FROM SUCH REGISTRATION.
OBJECTSOFT CORPORATION (the "Company") has agreed to issue to
________________ ("Holder") this warrant to acquire _____ Thousand (_0,000)
shares of the common stock of the Company (the "Common Stock"), pursuant to the
terms provided in this Warrant and Warrant Agreement. (This Warrant and Warrant
Agreement is hereafter referred to as the "Warrant.")
Accordingly, the Company and the Holder agree as follows:
1. ISSUANCE. The Company hereby issues to the Holder the right to
purchase, subject to the provisions of this Warrant, Fifty Thousand (50,000)
shares of the Common Stock, at a price of $.50 per share, as adjusted in
accordance with the terms hereof, at any time during the period from the date of
this Warrant through and including 3:30 P.M., New York City time, on April 14,
1998 (the "Exercise Period") at which time this Warrant shall expire and become
void. The number of shares of Common Stock to be received upon the exercise of
this warrant and the price to be paid for each share of Common Stock may be
adjusted from time to time as herein set forth. The shares of Common Stock
deliverable pursuant to this Warrant as they may be adjusted from time to time
are herein referred to as "Warrant Shares" and the exercise price of a share of
Common Stock in effect at any time and as adjusted from time to time is herein
referred to as the "Exercise Price."
2. EXERCISE OF WARRANTS. This Warrant may be exercised as a whole or
in part at any time during the Exercise Period by presentation and surrender
hereof to the Company at its executive offices with the Purchase Form annexed
hereto duly executed and accompanied by payment of the Exercise Price. If this
Warrant is exercised in part, the Company will issue to the Holder a new warrant
representing the right of the Holder to purchase the remaining number of Warrant
Shares and otherwise on identical terms hereto.
3. RESERVATION OF SHARES. The Company hereby agrees that at all times
during the term of this Warrant there shall be reserved for issuance upon
exercise of this Warrant such number of shares of its Common Stock as shall be
required for issuance upon exercise of this Warrant.
4. ASSIGNMENT OR LOSS OF WARRANT. (a) This Warrant is not assignable
or transferable without the written consent of the Company, except by operation
of law or as provided in (b) below. Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant, and (in the case of loss, theft or destruction) receipt of reasonably
satisfactory indemnification, and (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will execute and deliver a new Warrant
of like tenor and date and any such lost, stolen, destroyed or mutilated Warrant
shall thereupon become void.
(b) This Warrant shall not be transferable by Holder other than to a
"Permitted Transferee" (as defined below), or a financial institution as
collateral to secure a pledge from the Holder to the financial institution in
connection with a loan from such financial institution to the Holder; PROVIDED,
that any Permitted Transferee shall be absolutely prohibited from transferring
all or any portion of this Warrant other than to Holder or another Permitted
Transferee of Holder; and PROVIDED FURTHER, that if Holder dies or becomes
incapacitated, this Warrant may be exercised by Holder's estate, legal
representative or beneficiary, as the case may be, subject to all other terms
and conditions contained in this Warrant.
(c) For purposes of this Agreement, Permitted Transferees shall
include only the members of the "immediate family" (which shall be limited to
his spouse, children, parents and siblings) of Holder, and to trusts for such
person's own benefit and/or for the benefit of members of his immediate family;
PROVIDED, that such Permitted Transferees must agree in writing to be bound by
all of the terms of this Agreement to the same extent as Holder hereunder, in
form acceptable to counsel to the Company, including but not limited to
restrictions on the exercise of this Warrant and on transfers of Shares
following exercise of this Warrant, such that any Shares so acquired shall be
held subject to the terms of this Agreement. Shares held by any Permitted
Transferee shall be aggregated with those held by the Permitted Transferee's
transferor in order to determine the number of Shares subject to the provisions
of this Agreement.
5. RIGHTS OF THE HOLDER. The Holder shall not, by virtue hereof, be
entitled to any rights of a stockholder in the Company, either at law or equity,
and the rights of the Holder are limited to those expressed in this Warrant and
are not enforceable against the Company except to the extent set forth herein.
6. PROTECTION AGAINST DILUTION.
6.1 If at any time and from time to time the Company shall
(i) declare a dividend or make a distribution in shares of Common Stock, (ii)
subdivide its outstanding shares of Common Stock, (iii) combine its outstanding
shares of Common Stock or (iv) otherwise effect a recapitalization of such
character that the shares of Common Stock shall be changed into or become
exchangeable for a greater or lesser number of shares of Common Stock, then the
Exercise Price in
effect on the record date of such dividend or distribution or the effective date
of such subdivision, combination or reclassification (individually an "Event"
and collectively the "Events") shall be adjusted, or further adjusted, to a
price (to the nearest cent) determined by multiplying (i) the Exercise Price in
effect immediately prior to such Event by (ii) a fraction, the numerator of
which shall be the number of shares of Common Stock outstanding immediately
prior to such Event, and the denominator of which shall be the number of shares
of Common Stock outstanding immediately after such Event. Upon each adjustment
in the Exercise Price resulting from an Event, the number of Warrant Shares
shall be adjusted (to the nearest one-thousandth share) by multiplying (i) the
number of Warrant Shares for which the Warrant was exercisable immediately prior
to such Event by (ii) a fraction, the numerator of which shall be the Exercise
Price in effect immediately prior to such Event, and the denominator of which
shall be the Exercise Price in effect immediately after such Event. Notice of
each such adjustment and each such readjustment shall be forthwith mailed to the
Holder setting forth such adjustments or readjustments and the facts and
calculations thereof in reasonable detail. Any dividend paid or distributed upon
the Common Stock in stock of any other class of securities convertible into
shares of Common Stock shall be treated as a dividend paid in Common Stock to
the extent that shares of Common Stock are issuable upon the conversion thereof.
6.2 In case: (i) a distribution in the form of stock or
other securities of any other corporation or other entity shall be made or paid
by the Company on, or with respect to, the then outstanding shares of Common
Stock, (ii) the Company shall effect a recapitalization of such character that
the shares of Common Stock will be changed into or become exchangeable for
shares of Common Stock with a different par value or no par value, (iii) the
Company (or a successor corporation) shall be consolidated or merged with or
into another corporation or entity or shall sell, lease or convey all or
substantially all of its assets in exchange for stock or property (including
cash) with the view of distribution such stock or property to its shareholders,
or (iv) the Board of Directors of the Company shall declare any dividend or
other distribution in cash or any evidence of the Company's indebtedness (other
than convertible securities) with respect to the shares of Common Stock, each
share of Common Stock issuable upon exercise of this Warrant shall be replaced
by, and/or shall include, as the case may be, for the purposes hereof, the
stock, property, cash or evidence of indebtedness issued or distributed in
respect of each share of Common Stock upon such recapitalization,
reclassification, merger, sale, lease, conveyance or distribution as the Holder
would have been entitled to had the Holder exercised this Warrant immediately
prior to any such occurrence, and adequate provision to that effect shall be
made at the time thereof.
6.3 In case:
6.3.1. of any classification, reclassification or other
reorganization of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, or the sale, lease or conveyance
of all or substantially all of the assets of the Company; or
6.3.2. of the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, and in any such case, the Company shall mail to the Holder, at least 15
days prior thereto, a notice stating the date or expected date on which a record
is to be taken. Such notice shall also specify the date or expected date, if any
is to be fixed, as of which holders of Common Stock of record shall be entitled
to exchange their shares of Common Stock for securities or other property
deliverable upon such classification, reclassification, reorganization,
consolidation, merger, conveyance, dissolution, liquidation, winding up or any
other appropriate action, as the case may be.
7. TRANSFER TO COMPLY WITH THE SECURITIES ACT. This Warrant has not
been registered under the Securities Act of 1933, as amended, (the "Act") and
has been issued to the Holder for investment and not with a view to the
distribution of either the Warrant or the Warrant Shares. Neither this Warrant
nor any of the Warrant Shares or any other security issued or issuable upon
exercise of this Warrant may be sold, transferred, pledged or hypothecated in
the absence of an effective registration statement under the Act relating to
such security or an opinion of counsel satisfactory to the Company that
registration is not required under the Act. Each certificate for the Warrant,
the Warrant Shares and any other security issued or issuable upon exercise of
this Warrant shall contain a legend on the face thereof, in form and substance
satisfactory to counsel for the Company, setting forth the restrictions on
transfer contained in this Section.
8. REGISTRATION RIGHTS.(i) If at any time or from time to time
following the date hereof, the Company shall determine to register any
distribution of its securities with the Securities and Exchange Commission,
either for its own account or the account of a security holder or holders, in a
registration statement covering the sale of shares of Common Stock to the
general public pursuant to a public offering in compliance with the Act (except
with respect to any registration filed on Form X-0, Xxxx X-0 or such other form
which does not include substantially the same information as would be included
in a registration statement covering the sale of shares of Common Stock to the
general public), the Company will: (a) give to Holder written notice thereof at
least 30 days before the initial filing of such registration statement (which
shall include a list of the jurisdictions in which the Company intends to
attempt to qualify such securities under the applicable blue sky or other state
securities laws); and (b) use its best efforts to include in such registration
(and any related qualification under blue sky laws) and in any underwriting
involved therein, all the Shares specified in a written request, made within 30
days after receipt of such written notice from the Company, by Holder, except as
set forth in subparagraphs (ii) or (iii) below.
(ii) If the distribution is to be underwritten, the right
of Holder to registration pursuant to this Section 8 shall be conditioned upon
Holder's participation in the underwriting and the inclusion of Holder's Shares
in the underwriting to the extent provided herein. Holder shall (together with
the Company) enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by the Company.
Holder shall furnish to the Company such written information concerning Holder
and the distribution proposed by Holder as the Company may reasonably request.
(iii) Notwithstanding any other provision of this Section
8, if the underwriter determines that marketing factors require a limitation of
the number of shares to be underwritten, and such determination is made by such
underwriter in writing and in good faith, then
the underwriter may limit the number of Holder's Shares to be included in the
registration and underwriting, or may exclude Holder's Shares entirely from such
registration and underwriting, provided that the underwriter limits all proposed
selling shareholders on a pro-rata basis.
(iv) All expenses incurred in connection with any
registration or qualification pursuant to this Agreement, including, without
limitation, all registration, filing and qualification fees, printing expenses,
fees and disbursements of counsel for the Company, and expenses and fees of any
special audits incidental to or required by such registration, shall be borne by
the Company; PROVIDED, HOWEVER, that the Company in any event shall not be
required to pay the fees of Holder's legal counsel, brokerage fees, or
underwriters, fees, discounts or commissions relating to Holder's Shares (such
legal fees, brokerage fees, and underwriters, fees, discounts or commissions to
be borne by Holder).
(v) In the case of each registration effected by the
Company pursuant to this Agreement, the Company will: (i) keep such registration
or qualification pursuant to this Section 8 effective for a period of 90 days or
until Holder has completed the distribution described in the registration
statement relating thereto, whichever first occurs, and (ii) furnish such number
of prospectuses and other documents incident thereto as Holder from time to time
may reasonably request.
(vi) The registration rights granted to Holder pursuant to
this Section 8 are assignable to his Estate and his Permitted Transferees in
connection with a transfer of any Shares to such persons.
9. NOTICES. Any notice or other communication required or permitted
hereunder shall be in writing and shall be delivered personally, telegraphed,
telexed, sent by facsimile transmission or sent by certified, registered or
express mail, postage pre-paid. Any such notice shall be deemed given when so
delivered personally, telegraphed, telexed or sent by facsimile transmission,
or, if mailed, two days after the date of deposit in the United States mails, as
follows:
(i) if to the Company, to:
OBJECTSOFT CORPORATION
00 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx X. X. Xxxxx, Chairman
(ii) if to the Holder, to:
Any party may be notice given in accordance with this Section to the other
parties designate another address or person for receipt of notices hereunder.
10. SUPPLEMENTS AND AMENDMENTS; WHOLE AGREEMENT. This Warrant may be
amended or supplemented only by an instrument in writing signed by the parties
hereto. This Warrant contains the full understanding of the parties hereto with
respect to the subject matter hereof and thereof and there are no
representations, warranties, agreements or understandings other than expressly
contained herein and therein.
11. GOVERNING LAW. This Warrant shall be deemed to be a contract made
under the laws of the State of New Jersey and for all purposes shall be governed
by and construed in accordance with the laws of such State applicable to
contracts to be made and performed entirely within such State.
12. COUNTERPARTS. This Warrant may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
13. DESCRIPTIVE HEADINGS. Descriptive headings of the several
Sections of this Warrant are inserted for convenience only and shall not control
or affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the 15th day of April, 1993.
OBJECTSOFT CORPORATION
By: _____________________________
Xxxxxx X. Xxxxxx, President
__________________________________
Xxxxx X. X. Xxxxx, Chairman
