EXHIBIT 4.4
EXECUTION COPY
NEITHER THIS WARRANT NOR THE SHARES OF STOCK ISSUABLE UPON EXERCISE HEREOF HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. NO SALE, TRANSFER
OR OTHER DISPOSITION OF THIS WARRANT OR SAID SHARES MAY BE EFFECTED WITHOUT (i)
AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO, OR (ii) AN OPINION OF
COUNSEL, REASONABLY SATISFACTORY TO COUNSEL TO THE COMPANY, THAT AN EXEMPTION
FROM REGISTRATION UNDER SAID ACT IS AVAILABLE.
July 17, 2003 SECOND AMENDED AND RESTATED Warrant No.: 9
STOCK PURCHASE WARRANT
To Subscribe for and Purchase Class A Common Stock of
NEXTERA ENTERPRISES, INC.
THIS SECOND AMENDED AND RESTATED STOCK PURCHASE WARRANT ("Warrant")
certifies that, for value received, Banc of America Strategic Solutions, Inc.
(together with any subsequent transferees of all or any portion of this Warrant,
the "Holder"), is entitled, upon the terms and subject to the conditions
hereinafter set forth, to subscribe for and purchase from Nextera Enterprises,
Inc., a Delaware corporation (hereinafter called the "Company"), up to two
hundred eighteen thousand, one hundred and eight-two (218,182) fully paid and
non-assessable shares of the Company's Class A Common Stock, $0.001 par value
per share (the "Shares"), at the price equal to the Exercise Price (as defined
in Section 1 hereof) (subject to adjustment as provided in Section 7 hereof).
The number and character of such Shares are subject to adjustment as provided
herein. Capitalized terms used herein and not defined herein shall have the
meanings given such terms in that certain Second Amended and Restated Credit
Agreement dated December 31, 2002, as amended by that certain First Amendment
dated as of July 8, 2003, and that certain Second Amendment dated the date
hereof, by and among Company, the Holder and the other lenders party thereto (as
the same may be further amended, restated, supplemented, or otherwise modified
from time to time, the "Credit Agreement"; and together with all related
promissory notes, mortgages, guaranties, agreements, documents and instruments
from time to time entered into by Company and any other person or obligor
pursuant thereto, the Credit Documents")
This Warrant amends and restates in its entirety that certain Warrant for
up to two hundred eighteen thousand, one hundred and eight-two (218,182) fully
paid and non-assessable shares of the Company's Class A Common Stock, $0.001 par
value per share dated December 31, 2002 (the "Prior Warrant"), made by the
Company in favor of the Holder.
1. Definitions. As used herein the following terms shall have the
following meanings:
"Act" means the Securities Act of 1933 as amended, or a similar
Federal statute and the rules and regulations of the Commission
issued under that Act, as they each may, from time to time, be in
effect.
"Additional Shares of Common Stock" shall mean all shares of Common
Stock issued (or, pursuant to Section 7(c), deemed to be issued) by
the Company after the Original Issue Date, but shall not include:
(A) shares of Common Stock issued or issuable upon conversion of
shares of all of preferred stock of the Company outstanding as of
the Original Issue Date;
(B) shares of Common Stock issued or issuable upon exercise of this
Warrant or any other warrant or option of the Company outstanding as
of the Original Issue Date;
(C) shares of Common Stock issued by way of dividend or other
distribution on shares of Common Stock excluded from the definition
of Additional Shares of Common Stock by the foregoing clause (A) or
(B) or on Common Stock so excluded; or
(D) shares issued under an employee stock purchase plan or pursuant
to options exercisable for shares of Common Stock (such number
subject to equitable adjustment in the event of any stock dividend,
stock split, combination, reorganization, recapitalization,
reclassification or other similar event), issued after the date of
this Warrant to directors, officers, employees or consultants of the
Company and any Subsidiary pursuant to any qualified or
non-qualified stock option plan or other equity incentive plan
approved by the Board of Directors of the Company, equal to the
first 30% of the outstanding stock of the Company, calculated on a
post-Original Issue Date, fully-diluted basis.
"Common Stock" shall mean the Class A Common Stock of the Company,
$0.001 par value per share.
"Convertible Securities" shall mean any evidences of indebtedness,
shares or other securities directly or indirectly convertible into
or exchangeable for Common Stock.
"Exercise Price" shall mean $0.60 per share.
"New Financing Source" shall mean a source other than the Company.
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"Option" shall mean rights, options or warrants to subscribe for,
purchase or otherwise acquire Common Stock or Convertible
Securities.
"Original Issue Date" shall mean the date on which this Warrant is
originally issued.
2. Purchase Rights. The purchase rights represented by this Warrant are
exercisable by the Holder in whole or in part (and not as to a fractional
share), at any time and from time to time commencing on the date hereof and
ending at 5:00 p.m. on the date (the "Expiration Date") eighteen (18) months
after the indefeasible payment in full in cash or cash equivalents of the Credit
Obligations.
3. Exercise of Warrant; Net Issue Exercise.
3.1 Exercise of Warrant. Subject to Section 2 above, the purchase rights
represented by this Warrant may be exercised, in whole or in part and from time
to time, by the surrender of this Warrant and the duly executed Notice of
Exercise (the form of which is attached as Exhibit A) at the principal office of
the Company and by the payment to the Company, by check, of an amount equal to
the then applicable Exercise Price per share multiplied by the number of Shares
then being purchased. Upon exercise, the Holder shall be entitled to receive,
within a reasonable time, a certificate or certificates, issued in the Holder's
name or in such name or names as the Holder may direct, for the number of Shares
so purchased. The Shares so purchased shall be deemed to be issued as of the
close of business on the date on which this Warrant shall have been exercised.
3.2. Net Issue Exercise.
(a) In lieu of exercising this Warrant as set forth in Section 3.1,
the Holder may elect to receive Shares equal to the value of this Warrant
(or the portion thereof being cancelled) by surrender of this Warrant at
the principal office of the Company together with notice of such election
in which event the Company shall issue to the Holder a number of Shares
computed using the following formula:
X = Y (A - B)
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A
Where X = the number of Shares to be issued to the Holder;
Y = the number of Shares purchasable under this Warrant, or if
only a portion of this Warrant is being cancelled, the gross
number of Shares covered by the portion of this Warrant being
cancelled;
A= the fair market value of one Share, as determined by the Board of
Directors of the Company pursuant to paragraph (b) below, as at the
time the net issue election is made pursuant to this Section (the
"Determination Date"); and
B= the Exercise Price (as adjusted to the date of such calculations).
Such Shares shall be issued as soon as practicable after the Determination Date.
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(b) For purposes of this Section, fair market value of a Share shall
be determined as follows:
(A) If the Company's Common Stock is not publicly traded
at the Determination Date, the fair market value of a Share
shall be a value reasonably determined by the Company's Board
of Directors. In the event that the Holder disagrees with the
Board of Directors' determination of fair market value, then
the fair market value shall be determined by an appraiser
selected by the Holder (the "Holder's Appraiser") and whose
appraisal (the "Holder's Appraisal") shall be furnished to the
Company within 20 days after the Board of Directors'
determination of fair value, and if the Company does not
object to such determination within 15 days after receipt of
the Holder's appraisal, then the fair market value determined
by the Holder's Appraiser shall be the fair market value of a
Share. In the event that the Company objects to such
determination then the Company shall select an appraiser (the
"Company's Appraiser") who shall review the determination of
the Holder's Appraiser and issue a report thereon (the
"Company's Appraisal") within 30 days after the delivery of
the Holder's Appraisal to the Company and within 10 days after
the issuance of such report to the Holder's Appraiser, the
Holder's Appraiser and the Company's Appraiser shall meet to
negotiate in good faith to reach agreement on the fair market
value of a Share, and such agreed value shall be the fair
market value of a Share. In the event that the Company's
Appraiser and the Holder's Appraiser are unable to reach
agreement then such Appraisers shall select an appraiser (the
"Third Appraiser") within 5 days after the meeting between the
Holder's Appraiser and the Company's Appraiser, and the
average of two appraisals, consisting of the appraisal made by
the Third Appraiser and the appraisal of the Holder's
Appraiser and Company's Appraiser (whichever is closest to
that of the Third Appraiser), shall be conclusive and binding
on the Company and the Holder. The Company and the Holder
shall each pay one half (1/2) of the fees and expenses of each
of the Company's Appraiser, the Holder's Appraiser and the
Third Appraiser.
(B) if the Company's Common Stock is publicly traded on
the Determination Date, the fair market value of a Share shall
be equal to (1) the average of the closing prices quoted on
the Nasdaq Stock Exchange, Inc., if applicable, or the average
of the last bid and asked prices of the Common Stock quoted in
the Nasdaq OTC Bulletin Board or the over-the-counter-market,
or (2) if the Common Stock is then traded on a national
securities exchange, the average of the high and low closing
prices of the Common Stock listed on the principal national
securities exchange on which the Common Stock is so traded, in
each case for the twenty (20) trading days preceding the
Determination Date.
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4. Shares to be Issued; Reservation of Shares. The Company covenants that
the Shares that may be issued upon the exercise of the purchase rights
represented by this Warrant will, upon issuance, be fully paid and
non-assessable, and free from all liens and charges with respect to the issue
thereof. During the period within which the purchase rights represented by the
Warrant may be exercised, the Company will at all times have authorized and
reserved, for the purpose of issuance upon exercise of the purchase rights
represented by this Warrant, a sufficient number of shares of its Common Stock
to provide for the exercise of the right represented by this Warrant.
5. No Fractional Shares. No fractional shares shall be issued upon the
exercise of this Warrant. In lieu thereof, a cash payment shall be made equal to
such fraction multiplied by the fair market value of such shares of Common
Stock, as determined pursuant to Section 3.2(b) above.
6. Adjustment for Merger, Consolidation or Sale of Assets. In the event
that at any time or from time to time after the Original Issue Date, the Company
shall merge or consolidate with or into another entity or sell all or
substantially all of its assets, the Holder hereof shall thereafter have the
right to receive the kind and amount of shares of stock, other securities,
property or cash deliverable or payable to the holders of the Common Stock of
the Company that the Holder hereof upon exercise of this Warrant would have been
entitled to had the Holder hereof exercised the remaining portion of this
Warrant into shares of Common Stock immediately prior thereto.
7. Adjustment of Exercise Price and Number of Shares.
(a) Adjustment of Exercise Price and Number of Shares. The Exercise
Price and number of shares of Common Stock issuable upon the exercise of
the Warrant shall be adjusted as set forth in this Section 7 with the
intent that the rights of the Holder to exercise shall not be impaired.
(b) Adjustment for Combination, Consolidation, Stock Dividend or
Subdivision of Common Stock. If the outstanding shares of Common Stock
shall be subdivided into a greater number of shares or a dividend in
Common Stock shall be paid in respect of Common Stock, the Exercise Price
in effect immediately prior to such subdivision or at the record date of
such dividend shall simultaneously with the effectiveness of such
subdivision or immediately after the record date of such dividend be
proportionately reduced. If outstanding shares of Common Stock shall be
combined or consolidated into a smaller number of shares, the Exercise
Price in effect immediately prior to such combination or consolidation
shall, simultaneously with the effectiveness of such combination or
consolidation, be proportionately increased. When any adjustment is
required to be made in the Exercise Price, the number of shares of Common
Stock purchasable upon the exercise of this Warrant shall be changed to
the number determined by dividing (i) an amount equal to the number of
shares issuable upon the exercise of this Warrant immediately prior to
such adjustment, multiplied by the Exercise Price in effect
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immediately prior to such adjustment, by (ii) the Exercise Price in effect
immediately after such adjustment.
(c) Issue of Options and Convertible Securities Deemed Issue of
Additional Shares of Common Stock. If the Company at any time or from time
to time after the Original Issue Date shall issue any Options or
Convertible Securities or shall fix a record date for the determination of
holders of any class of securities entitled to receive any such Options or
Convertible Securities, then the maximum number of shares of Common Stock
(as set forth in the instrument relating thereto, without regard to any
provision contained therein for a subsequent adjustment of such number)
issuable upon the exercise of such Options or, in the case of Convertible
Securities or Options therefor, the conversion or exchange of such
Convertible Securities, shall be deemed to be Additional Shares of Common
Stock issued as of the time of such issue or, in case such a record date
shall have been fixed, as of the close of business on such record date,
provided that Additional Shares of Common Stock shall not be deemed to
have been issued unless the consideration per share (determined pursuant
to paragraph (e) below) of such Additional Shares of Common Stock would be
less than the Exercise Price in effect on the date of and immediately
prior to such issue, or such record date, as the case may be, and provided
further in any such case in which Additional Shares of Common Stock are
deemed to be issued:
(i) No further adjustment in the Exercise Price shall be made
upon the subsequent issue of Convertible Securities or shares of
Common Stock upon the exercise of such Options or conversion or
exchange of such Convertible Securities;
(ii) If such Options or Convertible Securities by their terms
provide, with the passage of time or otherwise, for any increase in
the consideration payable to the Company, or decrease in the number
of shares of Common Stock issuable, upon the exercise, conversion or
exchange thereof, the Exercise Price computed upon the original
issue thereof (or upon the occurrence of a record date with respect
thereto), and any subsequent adjustments based thereon, shall, upon
any such increase or decrease becoming effective, be recomputed to
reflect such increase or decrease insofar as it affects such Options
or the rights of conversion or exchange under such Convertible
Securities;
(iii) No readjustment pursuant to clause (ii) above shall have
the effect of increasing the Exercise Price to an amount which
exceeds the lower of (A) the Exercise Price immediately prior to the
adjustment affected upon the original issue of Options or
Convertible Securities (or upon the occurrence of a record date with
respect thereto) pursuant to the provisions hereof, or (B) the
Exercise Price that would have resulted from any issuance of
Additional Shares of Common Stock between the original adjustment
date and such readjustment date;
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(iv) Upon the expiration or termination of any unexercised
Option, the Exercise Price shall be readjusted to the Exercise Price
which would have been in effect at the time of such expiration or
termination had such Option never been issued (but including the
recalculation of any intervening adjustments), and the Additional
Shares of Common Stock deemed issued as the result of the original
issue of such Option shall not be deemed issued for the purposes of
any subsequent adjustment of the Exercise Price; and
(v) In the event of any change in the number of shares of
Common Stock issuable upon the exercise, conversion or exchange of
any Option or Convertible Security, including, but not limited to, a
change resulting from the antidilution provisions thereof, the
Exercise Price then in effect shall forthwith be readjusted to such
Exercise Price as would have obtained had the adjustment which was
made upon the issuance of such Option or Convertible Security (prior
to such change) been made upon the basis of such change, but no
further adjustment shall be made for the actual issuance of Common
Stock upon the exercise or conversion of any such Option or
Convertible Security.
(d) Adjustment of Exercise Price Upon Issuance of Additional Shares
of Common Stock. In the event the Company shall at any time after the
Original Issue Date issue Additional Shares of Common Stock (including
Additional Shares of Common Stock deemed to be issued pursuant to
paragraph (c) above), without consideration or for a consideration per
share less than the Exercise Price in effect on the date of and
immediately prior to such issue, then and in such event, such Exercise
Price shall be reduced, concurrently with such issue, to a price
(calculated to the nearest cent) calculated as follows:
(i) The adjusted Exercise Price shall be equal to a fraction:
(A) the numerator of which shall be the number of shares of Common
Stock outstanding immediately prior to such issue (including shares
described in clause (ii) below), plus the number of shares of Common
Stock which the aggregate consideration received by the Company for
the total number of Additional Shares of Common Stock so issued
would purchase at such Exercise Price; and (B) the denominator of
which shall be the number of shares of Common Stock outstanding
immediately prior to such issue (including shares described in
clause (ii) below) plus the number of such Additional Shares of
Common Stock so issued.
(ii) For the purposes of clause (i), the number of shares of
Common Stock outstanding immediately prior to such issue shall be
calculated on a fully diluted basis, as if all Convertible
Securities had been fully converted into shares of Common Stock
immediately prior to such issuance and the Warrant and any other
outstanding Options had been fully exercised immediately prior to
such issuance (and any resulting Convertible Securities fully
converted into Common Stock) as of such date.
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(iii) The applicable Exercise Price shall not be reduced at
the time of any issuance of Additional Shares of Common Stock if the
amount of such reduction would be an amount less than $0.01, but any
such amount shall be carried forward and reduction with respect
thereto shall be made at the time and together with any subsequent
reduction which, together with such amount and any other amounts so
carried forward, shall aggregate $0.01 or more.
(e) Determination of Consideration. For purposes of paragraph (d),
the consideration received by the Company for the issue of any Additional
Shares of Common Stock shall be computed as follows:
(i) Cash and Property: Such consideration shall:
(A) insofar as it consists of cash, be computed at the
aggregate of cash received by the Company;
(B) insofar as it consists of property other than cash,
be computed at the fair market value thereof at the time of
such issue, as determined in good faith by the Board of
Directors; and
(C) in the event Additional Shares of Common Stock are
issued together with other shares or securities or other
assets of the Company for consideration which covers both, be
the proportion of such consideration so received, computed as
provided in clauses (A) and (B) above, as determined in good
faith by the Board of Directors.
(ii) Options and Convertible Securities. The consideration per
share received by the Company for Additional Shares of Common Stock
deemed to have been issued pursuant to paragraph (c), relating to
Options and Convertible Securities, shall be determined by dividing:
(A) the total amount, if any, received or receivable by
the Company as consideration for the issue of such Options or
Convertible Securities, plus the minimum aggregate amount of
additional consideration (as set forth in the instruments
relating thereto, without regard to any provision contained
therein for a subsequent adjustment of such consideration)
payable to the Company upon the exercise of such Options or
the conversion or exchange of such Convertible Securities, or
in the case of Options for Convertible Securities, the
exercise of such Options for Convertible Securities and the
conversion or exchange of such Convertible Securities; by
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(B) the maximum number of shares of Common
Stock (as set forth in the instrument relating
thereto, without regard to any provision contained
therein for a subsequent adjustment of such number)
issuable upon the exercise of such Options or the
conversion or exchange of such Convertible
Securities.
(f) Certificate as to Adjustments. Upon the occurrence of each
adjustment or readjustment of the Exercise Price pursuant to this Section
7, the Company at its expense shall promptly compute such adjustment or
readjustment in accordance with the terms hereof and furnish to the Holder
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 the Holder, furnish
or cause to be furnished to such holder a like certificate setting forth
(i) such adjustments and readjustments, (ii) the Exercise Price at the
time in effect, and (iii) the number of shares of Common Stock and the
amount, if any, of other property which at the time would be received upon
the exercise of the Warrant.
8. No Rights as a Shareholder. This Warrant does not entitle the Holder to
any voting rights or other rights as a shareholder of the Company prior to
exercise of this Warrant and the payment for the Shares so purchased.
Notwithstanding the foregoing, the Company agrees to transmit to the Holder such
information, documents and reports as are generally distributed to holders of
the capital stock of the Company concurrently with the distribution thereof to
the shareholders. Upon valid exercise of this Warrant and payment for the Shares
so purchased in accordance with the terms of the Warrant, the Holder shall be
deemed a shareholder of the Company.
9. Sale or Transfer of the Warrant; Legend. The Warrant and the Shares
shall not be sold or transferred unless either (i) they first shall have been
registered under the Act, or (ii) the Company first shall have been furnished
with an opinion of legal counsel reasonably satisfactory to the Company to the
effect that such sale or transfer is exempt from the registration requirements
of the Act. Each certificate representing any Warrant shall bear the legend set
out on page 1 hereof. Each certificate representing any Shares shall bear a
legend substantially in the following form, as appropriate:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE
OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED.
Such Warrant and Shares may be subject to additional restrictions on transfer
imposed under applicable state and federal securities law.
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10. Put Right. Commencing on the earlier of December 31, 2004 and (ii) the
date upon which the Loans (as defined in the Credit Agreement) owed to Holder
and the other lenders party to the Credit Agreement have been paid in full in
cash or Cash equivalents and in each case (i) and (ii) prior to the Expiration
Date, the Holder shall have the right, exercised by the delivery of written
notice to the Company (a "Put Notice"), to require the Company to cancel the
unexercised portion of this Warrant, and all related rights in exchange for a
cash payment (the "Put Payment") equal to $0.23 per-share payable to the Holder
within ten (10) days of receipt by the Company of the Put Notice and the
original Warrant for cancellation.
11. Call Option. At any time during the one year period following the
indefeasible payment in full in cash or cash equivalents of the Credit
Obligations, and prior to June 30, 2004, the Company shall have the right
exercised by the delivery of written notice to the Holder (a "Call Notice") to
cancel this Warrant and the purchase rights hereunder in exchange for a cash
payment (the "Call Payment") equal to $0.5288 per share, payable to the Holder
within five (5) days after delivery by the Company of the Call Notice, provided
however, that any payment made pursuant to this Section 11 may only be made out
of a New Financing Source. Notwithstanding anything to the contrary contained
herein, the Holder shall be entitled to exercise this Warrant in whole or in
part at any time after the receipt of the Call Notice until the receipt by the
Holder of the Call Payment. In the event that the Holder chooses to exercise all
or a portion of the Warrant after receipt of the Call Notice, the Company shall
have the option to rescind such Call Notice or to exercise its call option with
respect to that portion of the Warrant which remains unexercised through the
delivery of a pro rata portion of the Call Payment. The Company shall have the
right to exercise the call option set forth herein one time only.
12. Modifications and Waivers. This Warrant may not be changed, waived,
discharged or terminated except by an instrument in writing signed by the party
against which enforcement of the same is sought.
13. Notices. Any notice, request or other document required or permitted
to be given or delivered to the Holder or the Company shall be sufficiently
given or made if sent by registered or certified mail, postage prepaid,
addressed to the parties as provided below:
If to Holder: Banc of America Strategic Solutions, Inc.
000 Xxxxxxx Xxxxxx
XX0-000-0000
Attn: Xxxx Xxxxxxxx, Managing Director
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with a copy to:
Xxxxx Xxxxxxx Berlack Israels LLP
Xxx Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx, Esquire
Xxxx X. Xxxxx, Esquire
If to Company: Nextera Enterprises, Inc.
Xxx Xxxxxxxxx Xxxxxx - 0xx Xxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxxx,
Chief Financial Officer
with a copy to: Maron & Sandler
0000 0xx Xxxxxx
Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx, Esquire
14. Loss, Theft, Destruction or Mutilation of Warrant. The Company
covenants with the Holder that upon its receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant or any stock certificate and, in the case of any such loss, theft
or destruction, of an indemnity or security reasonably satisfactory to it, and
upon reimbursement to the Company of all reasonable expenses incidental thereto,
and upon surrender and cancellation of this Warrant or stock certificate, if
mutilated, the Company will make and deliver a new Warrant or stock certificate,
of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant or
stock certificate.
15. Representations and Warranties of Holder. By accepting this Warrant,
the Holder represents and warrants that it is acquiring this Warrant and the
Shares for its own account, for investment and not with a view to, or for sale
in connection with, any distribution thereof or any part thereof. Holder
represents and warrants that it is (a) experienced in the evaluation of
businesses similar to the Company, (b) is able to fend for itself in the
transactions contemplated by this Warrant, (c) has such knowledge and experience
in financial and business matters as to be capable of evaluating the merits and
risks of an investment in the Company, (d) has the ability to bear the economic
risks of an investment in the Company, (e) has been furnished with or has had
access to such information as is specified in subparagraph (b)(2) of Rule 502
promulgated under the Act and (f) has been afforded the opportunity to ask
questions of and to receive answers from the Company and to obtain any
additional information necessary to make an informed investment decision with
respect to an investment in the Company. The Holder further represents that it
is an "accredited investor" as defined in Rule 501(a) of Regulation D under the
Act.
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16. Representations and Warranties of Company. The Company represents
that:
(a) The execution and delivery of this Warrant has been duly
authorized by the Company's Board of Directors and constitutes the
legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency, or
other laws affecting the enforcement of creditors' rights in general
and except that the enforceability of the obligations hereunder is
subject to general principals of equity (regardless of whether such
enforceability is considered in a proceeding at equity or at law).
Neither the execution nor the delivery of this Warrant, nor
fulfillment of nor compliance with the terms and provisions of this
Warrant, nor the issuance of Shares upon exercise of the Warrant,
will violate the terms of the certificate of incorporation or
by-laws of the Company or, to the best of the Company's knowledge,
any agreement (including any agreement with stockholders),
instrument, judgment, decree or statute to which the Company is
subject.
(b) As of December 31, 2002, the authorized capital stock of
the Company consisted of (i) 99,300,000 shares of Common Stock,
$0.001 par value per share, 95,000,000 shares of which are
designated as Class A Common Stock, of which 31,885,896 shares are
issued and outstanding, and 4,300,000 shares of which are designated
as Class B Common Stock, of which 3,869,570 shares are issued and
outstanding, and (ii) 10,000,000 shares of Preferred Stock, $0.001
par value per share 600,000 shares of which are designated as Series
A Cumulative Convertible Preferred Stock, of which 39,544 shares are
issued and outstanding.
(c) Except as set forth in subparagraph (b) above, and in
registration statements filed by the Company under the Act or in any
report filed by the Company under the Securities Exchange Act of
1934, as amended, the Company has not authorized any rights (either
preemptive or other) or options to subscribe for or purchase from
the Company, or any warrants or other agreements providing for or
requiring the issuance by the Company of, any capital stock or any
securities convertible into or exchangeable for its capital stock.
(d) Sufficient shares of authorized but unissued shares of
Common Stock of the Company have been reserved by appropriate
corporate action with the prospective exercise of the Warrant, and,
the issuance of either the Warrant or the shares of Common Stock
upon exercise of the Warrant will not require any further corporate
action by the stockholders or directors of the Company, will not be
subject to preemptive rights (unless the exercise of the same has
been irrevocably waived) in any present stockholders of the Company
and will not conflict with any provision of any agreement to which
the Company is a party or by which it is bound, and such Common
Stock, when issued upon exercise of the Warrant in accordance with
its terms, will be duly authorized, fully paid and non-assessable.
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17. Registration Rights.
(a) Piggy Back Registration Rights. If (but without any
obligation to do so) the Company shall determine to register (a
"Company Registration") any of its securities for its own account or
for any other person (other than a registration under the Act of
shares issued in connection with any acquisition of any entity or
business, shares issuable solely upon the exercise of stock options,
or shares issuable solely pursuant to employee benefit plans or
arrangements, including registration statements on Form X-0, X-0 or
any successor form), the Company shall do the following:
(i) promptly give the Holder written notice thereof
(which shall include a list of the jurisdictions in which the
Company intends to attempt to register or qualify such
securities under the applicable blue sky or other state
securities laws); and
(ii) include among the securities which it then
registers or qualifies all Registrable Securities (as defined
below) specified in a written request or requests, made within
fifteen (15) days after receipt of the written notice from the
Company, by the Holder. The Holder shall have the right to
withdraw its request for inclusion of its Registrable
Securities in any registration statement by giving written
notice to the Company of its request to withdraw. The Company
may withdraw a Company Registration at any time prior to the
time it becomes effective whether or not the Holder has
elected to include Registrable Securities (as defined below)
in such registration. For purposes of this Warrant, the term
"Registrable Securities" shall mean all shares of Common Stock
issued and issuable upon exercise of the Warrant; provided
however, that shares of Common Stock which are "Registrable
Securities" shall cease to be Registrable Securities (a) upon
any sale pursuant to a registration statement under the Act,
Section 4(1) of the Act or Rule 144 promulgated under the Act
or (b) at such time as such shares of Common Stock are freely
saleable under Rule 144(k) promulgated under the Act (or a
successor provision).
(b) Limitations of Registration. If and to the extent that the
Holder shall have, at the time of the delivery of the written
request referred to in subparagraph (a) above, no present intention
of selling or distribution, the Company shall be obligated to effect
such registration, qualification or compliance with respect to the
Holder's Registrable Securities only if and to the extent, in each
case, that such registration, qualification and compliance are at
the time permitted by the applicable statutes or rules and
regulations thereunder or the practices of the governmental
authority concerned.
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(c) Registration Procedures. In the case of each registration,
qualification or compliance pursuant to this Section 17, the Company
will keep the Holder advised in writing as to the initiation of
proceedings for such registration, qualification and compliance and
as to the completion thereof, and will advise the Holder, upon
written request, of the progress of such proceedings. At the expense
of the Company, the Company will (i) keep such registration,
qualification and compliance current and effective for a period of
the earlier of (A) 120 days, or (B) until the Holder has completed
the distributions relating thereto, including, without limitation,
the filing of post-effective amendments and supplements to any
registration statement or prospectus, as necessary to permit the
sale or distribution of Registrable Securities not theretofore sold
or distributed, and (ii) take all necessary action under any
applicable blue sky or other state securities laws to permit such
exercise, sale or distribution, all as reasonably requested by such
Holder; provided, however, that the Company shall not be required in
connection therewith to qualify as a foreign corporation in any
jurisdiction in which it is not now so qualified or to take any
action that would subject it to general consent to service of
process or taxation. The Company shall not be required to file,
cause to become effective or maintain the effectiveness of any
registration statement that contemplates a distribution of
securities on a delayed or continuous basis pursuant to Rule 415
under the Act.
(d) Registration Rights. Anything to the contrary in Section
17 notwithstanding, in connection with any Company Registration, the
Company shall not be required to include any of the Holder's
Registrable Securities in such Company Registration unless the
Holder accepts the terms of the underwriting as agreed upon between
the Company and the underwriters selected by it (or by other persons
entitled to select the underwriters), and then only in such quantity
as the underwriters determine in their sole discretion will not
jeopardize the success of the offering by the Company or will not
adversely affect the aggregate proceeds to the Company from the
offering. If the total amount of securities, including Registrable
Securities and all other securities requested to be included in such
offering by any stockholder of the Company, exceeds the amount of
securities that the underwriters determine in their sole discretion
is compatible with the success of the offering or the aggregate
proceeds to the Company from the offering, then the number of Shares
to be offered for the account of the Holder and all such other
persons participating in such registration shall be reduced (to zero
if necessary) or limited pro rata in proportion to the respective
number of Shares requested to be registered by the Holder and each
other person to reduce the total number of Shares requested to be
included in such offering to the number of Shares, if any,
recommended by such underwriters.
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(e) Indemnification. The Company will indemnify, defend and
hold harmless the Holder to the fullest extent that such agreement
is enforceable under applicable law against all claims, losses,
damages and liabilities (or actions in respect thereof) arising out
of or based on any untrue statement (or alleged untrue statement) of
material fact contained therein (or in any related registration
statement, notification or the like) 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,
or any violation by the Company of any rule or regulation
promulgated under the Act 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
the Holder for any legal or any other expenses reasonably incurred
in connection with investigating or defending any such claim, loss,
damage, liability or action provided, however, that the Company will
not be liable in any such case to the extent that any such claim,
loss, damage or liability arises out of or is based on any untrue
statement or omission based upon written information furnished to
the Company by an instrument duly executed by the Holder and stated
to be specifically for use therein.
(f) The Holder will indemnify, defend and hold harmless the
Company to the fullest extent that such agreement is enforceable
under applicable law against all claims, losses, damages and
liabilities (or actions in respect thereof) arising out of or based
on any untrue statement (or alleged untrue statement) of material
fact contained therein (or in any related registration statement,
notification or the like) 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, or any
violation by the Holder of any rule or regulation promulgated under
the Act applicable to the Holder and relating to action or inaction
required of the Holder in connection with any such registration,
qualification or compliance, and will reimburse the Company 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 (and only to the extent) that
such claims, losses, damages, liabilities and actions relate to
reliance on any untrue statement or omission based upon written
information furnished to the Company by an instrument duly executed
by the Holder and stated to be specifically for use in the
registration statement, provided, however, that such Holder's
obligations hereunder shall be limited to an amount equal to the
proceeds received by such Holder of the Registrable Securities sold
in such registration.
(g) Notwithstanding the foregoing, to the extent that the
provisions on indemnification contained in the underwriting
agreement entered into in
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connection with a Company Registration are in conflict with the
provisions of this Section 17, the provisions in the underwriting
agreement shall control.
18. Binding Effect on Successors. This Warrant shall be binding upon any
corporation succeeding the Company by merger, consolidation or acquisition of
all or substantially all of the Company's assets, and all of the obligations of
the Company relating to the Shares issuable upon exercise of this Warrant shall
survive the exercise and termination of this Warrant and all of the covenants
and agreements of the Company shall inure to the benefit of the successors and
assigns of the Holder.
19. Amendments. No approval, consent, amendment or waiver of this
Agreement shall be effective unless in writing and signed by the Company and
Holder.
20. Counterparts. This Agreement may be executed in any number of
counterparts and each such counterpart shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.
21. Governing Law. This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the Commonwealth of Massachusetts.
22. Entire Agreement. This Warrant constitutes the entire agreement among
the parties hereto pertaining to the subject matter hereof, and any and all
other written or oral agreements relating to the subject matter hereof existing
among any of the parties hereto are expressly cancelled, including, but not
limited to, the Prior Warrant.
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IN WITNESS WHEREOF, the parties have caused this Warrant to be executed by
their duly authorized representatives as of the date first above written.
NEXTERA ENTERPRISES, INC.,
as Company
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxxxxx
Chief Financial Officer
BANC OF AMERICA STRATEGIC
SOLUTIONS, INC.,
as Lender and Holder
By: /s/ Xxxx Xxxxxxxx
--------------------------------------
Xxxx Xxxxxxxx
Managing Director
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EXHIBIT A
NOTICE OF EXERCISE
To: NEXTERA ENTERPRISES, INC.
1. The undersigned hereby elects to purchase _______ shares of Common
Stock of Nextera Enterprises, Inc. pursuant to the terms of the attached
Warrant, and tenders herewith payment of the purchase price of such shares in
full.
2. Please issue a certificate or certificates representing said shares in
the name of the undersigned or in such other name or names as are specified
below.
3. The undersigned represents that the aforesaid shares of Common Stock
are being acquired for the account of the undersigned for investment and not
with a view to, or for resale in connection with, the distribution thereof and
that the undersigned has no present intention of distributing or reselling such
shares. The undersigned further represents that such shares shall not be sold or
transferred unless either (1) they first shall have been registered under the
Securities Act of 1933, as amended, or (ii) the Company first shall have been
furnished with an opinion of legal counsel reasonably satisfactory to the
Company to the effect that such sale or transfer is exempt from the registration
requirement.
4. In the event of partial exercise, please re-issue an appropriate
Warrant exercisable into the remaining shares.
-------------------------------
(Name)
-------------------------------
(Address)
-------------------------------
(Signature)
-------------------------------
(Date)
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