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EXHIBIT 4.4
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON
EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF ANY STATE.
THIS WARRANT AND ANY OF SUCH SHARES MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT RELATING TO SUCH TRANSACTION UNDER
THE ACT AND ALL OTHER APPLICABLE SECURITIES LAWS OR PURSUANT TO AN
EXEMPTION FROM THE REGISTRATION PROVISIONS OF THE ACT AND OTHER
APPLICABLE SECURITIES LAWS.
COMMON STOCK WARRANT
WARRANT TO PURCHASE SHARES OF STOCK
OF ONLINE RESOURCES & COMMUNICATIONS CORPORATION
Date of Issuance:
THIS CERTIFIES that, for value received, ______________, or registered
assigns (the "Holder"), is entitled to purchase, subject to the provisions of
this Warrant, from Online Resources & Communications Corporation, a Delaware
corporation (the "Company"), at the price hereinafter set forth, that number of
shares of the one hundredth cent ($0.0001) par value Common Stock of the Company
as determined in accordance with the provisions of Article VI hereof. This
Warrant is hereinafter referred to as the "Warrant" and the shares of Common
Stock, par value $0.0001 per share issuable pursuant to the terms hereof are
hereinafter sometimes referred to as "Warrant Shares". This Warrant is issued
pursuant to the terms of that certain Note and Warrant Purchase Agreement, dated
as of May 8, 1996, by and among the Company and the Investors named therein (the
"Agreement").
ARTICLE I
CERTAIN DEFINITIONS
For all purposes of this Warrant, unless the context otherwise
requires, the following terms shall have the following respective meanings:
"Act": the Securities Act of 1933, as amended, or any similar federal
statute, and the rules and regulations of the Commission promulgated thereunder,
all as the same shall be in effect at the time.
"Common Stock": the Company's authorized shares of Common Stock, par
value $.0001 per share.
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"Commission": the Securities and Exchange Commission, or any other
federal agency then administering the Act.
"Company": Online Resources & Communications Corporation, a Delaware
corporation, located at 0000 Xxxxx Xxxxxx Xxxxx, XxXxxx, Xxxxxxxx 00000 and any
other corporation assuming or required to assume this Warrant pursuant to
Article VIII.
"Conversion Price": the Conversion Price as defined in the Notes.
"Notes": the 10% Convertible Senior Secured Notes due June 30, 1999
issued under the Agreement.
"Person": any individual, corporation, partnership, trust, limited
liability company, unincorporated organization and any government, and any
political subdivision, instrumentality or agency thereof.
"Purchase Price": the purchase price for any Warrant Share purchasable
under this Warrant.
"Warrant Office": see Section 3.1.
"Warrant Shares": the shares of Common Stock purchasable by the holder
of this Warrant upon the exercise of this Warrant.
ARTICLE II
EXERCISE OF WARRANT
2.1 Method of Exercise., To exercise this Warrant in whole or in part
at anytime and from time to time, prior to its expiration as determined in
Article IX hereof, the Holder hereof shall deliver to the Company, at the
Warrant Office designated pursuant to Section 3.1: (a) a written notice, in
substantially the form of the Subscription Notice attached hereto as Exhibit
2.1, of such Holder's election to exercise this Warrant, which notice shall
specify the number of shares of Common Stock to be purchased; (b) (i) a check
payable to the order of the Company in an amount equal to the Purchase Price as
set forth in Section 5.1 hereof for the number of shares of Common Stock being
purchased; (ii) instructions to the Company to withhold from the Warrant Shares
which otherwise would be issued to the Holder as a result of such exercise of
this Warrant, shares of Common Stock (valued at their fair market value on the
date of exercise) in satisfaction of all or part of the Purchase Price with
respect to such Warrant Shares to be purchased pursuant to such written notice
or (iii) an amount of Notes equal in principal amount to the Purchase Price with
respect to such Warrant Shares to be purchased pursuant to such written notice
and (c) this Warrant. The Company shall, as promptly as practicable and in any
event within fourteen (14) days thereafter, execute and deliver or cause to be
executed and delivered, in accordance with said notice, a certificate or
certificates representing the aggregate
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number of shares of Common Stock specified in said notice. The stock certificate
or certificates so delivered shall be in denominations of shares as may be
specified in said notice and shall be issued in the name of the Holder or such
other name as shall be designated in said notice. At the time of delivery of the
certificate or certificates, appropriate notation will be made on this Warrant
designating the number of shares purchased and this Warrant shall then be
returned to the Holder if this Warrant has been exercised in part. The Company
shall pay all expenses, taxes and other charges payable in connection with the
preparation, issuance and delivery of stock certificates, except that, in case
stock certificates shall be registered in a name or names other than the name of
the Holder of this Warrant, funds sufficient to pay all stock transfer taxes
which shall be payable upon the issuance of stock certificates shall be paid by
the Holder hereof at the time of delivering the notice of exercise mentioned
above or promptly upon receipt of a written request of the Company for payment.
As used in this Section 2.1, "Fair Market Value" shall mean the average of the
high and low sales prices of the Common Stock on the National Association of
Security Dealers Automated Quotation System ("NASDAQ") or the closing price
quoted on any exchange on which the Common Stock is listed, whichever is
applicable, as reported in the Eastern Edition of The Wall Street Journal, on
the date of exercise (or if no shares are traded on that date, the weighted
average of the means between the high and low sales prices of the Common Stock
on the nearest date before and after such date on which such shares were
traded). If the Common Stock is not traded on NASDAQ or on any exchange, the
Fair Market Value shall be determined in good faith by the Board of Directors of
the Company, on the one hand, and the Holder, on the other.
2.2 Shares to be Fully Paid and Nonassessable. All shares of Common
Stock issued upon the exercise of this Warrant shall be validly issued, fully
paid and nonassessable.
2.3 No Fractional Shares to be Issued. The Company shall not be
required upon any exercise of this Warrant to issue a certificate representing
any fraction of a share of Common Stock. Upon payment of the exercise price with
respect to any fractional shares, the Company shall pay to the Holder the cash
equivalent of such fractional shares, based on the fair market value of such
shares as reasonably determined by the Board of Directors of the Company.
2.4 Legend In Warrant Shares. Each certificate for shares of Common
Stock initially issued upon exercise of this Warrant, unless at the time of
exercise such shares are registered under the Act, shall bear a legend
substantially similar to the following:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the "Act"), or
the securities laws of any state. They may not be sold, transferred,
assigned, pledged, hypothecated, encumbered or otherwise disposed of
except pursuant to an effective registration statement relating to such
transaction under the Act and all other applicable securities laws or
pursuant to an exemption from the registration provisions of the Act
and other applicable securities laws.
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Any certificate issued at any time in exchange or substitution for any
certificate bearing such legend (except a new certificate issued upon completion
of a public distribution pursuant to a registration statement under the Act of
the securities represented thereby) shall also bear a legend substantially
similar to the foregoing, unless, in the opinion of counsel reasonably
satisfactory to the Company, the securities represented thereby need no longer
be subject to the restrictions on transferability. The provisions of Article IV
shall be binding upon all subsequent holders of this Warrant.
2.5 Acknowledgment of Continuing Obligation, The Company will, at the
time of any exercise of this Warrant in whole or in part, upon request of the
Holder hereof, acknowledge in writing its continuing obligation to such Holder
in respect of any rights to which the Holder shall continue to be entitled after
exercise in accordance with this Warrant; provided, however, that the failure of
the Holder to make any such request shall not affect the continuing obligation
of the Company to the Holder in respect of such rights.
ARTICLE III
WARRANT OFFICE; TRANSFER, DIVISION OR COMBINATION OF WARRANTS
3.1 Warrant Office. The Company shall maintain an office for certain
purposes specified herein (the "Warrant Office"), which office shall initially
be the Company's location set forth in Article I, and may subsequently be such
other office of the Company or of any transfer agent of the Common Stock in the
continental United States as to which written notice has previously been given
to all holders of Warrants.
3.2 Ownership of Warrant, The Company may deem and treat the Person in
whose name this Warrant is registered as the Holder and owner hereof
(notwithstanding any notations of ownership or writing hereon made by anyone
other than the Company) for all purposes and shall not be affected by any notice
to the contrary, until presentation of this Warrant for registration of transfer
as provided in this Article III.
3.3 Transfer of Warrant. The Company agrees to maintain at the Warrant
Office books for the registration of permitted transfers of this Warrant.
Subject to the provisions of Article IV, this Warrant and all rights hereunder
are transferable, in whole or in part, on the books at that office, upon
surrender of this Warrant at that office, together with a written assignment of
this Warrant duly executed by the holder hereof or his duly authorized agent or
attorney and funds sufficient to pay any transfer taxes payable upon the making
of the transfer. Subject to Article IV, upon surrender and payment, the Company
shall execute and deliver a new Warrant in the name of the assignee, note
thereon the number of Warrant Shares theretofore purchased under this Warrant,
and this Warrant shall promptly be cancelled and a notation of that cancellation
made on the books of the Warrant Office. A Warrant may be exercised by a new
holder for the purchase of shares of Common Stock without having a new warrant
issued.
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3.4 Division of Warrants. This Warrant may not be divided.
3.5 Expenses of Delivery of Warrants. The Company shall pay all
expenses, taxes (other than transfer taxes), and other charges payable in
connection with the preparation, issuance and delivery of new Warrants
hereunder.
ARTICLE IV
RESTRICTIONS ON TRANSFER
4.1 Restrictions on Transfer. Notwithstanding any provisions contained
in this Warrant to the contrary, this Warrant shall not be exercisable or
transferable except upon the conditions specified in this Article IV, which
conditions are intended, among other things, to insure compliance with the
provisions of the Act in respect of the exercise or transfer of the Warrant. The
Holder of this Warrant, by acceptance hereof, agrees that it will not transfer
this Warrant prior to delivery to the Company of any required opinion of the
Holder's counsel (as the opinion and counsel are described in Section 4.2).
4.2 Opinion of Counsel. In connection with any transfer of this
Warrant, the following provisions shall apply:
(a) If, in the opinion of counsel reasonably acceptable to the Company,
a proposed transfer of this Warrant may be effected without registration of this
Warrant under the Act, the Holder of this Warrant shall be entitled to transfer
this Warrant in accordance with the proposed method of disposition; provided,
however, that if the method of disposition would, in the opinion of such
counsel, require that the Company take any action or execute and file with the
Commission or deliver to the Holder or any other person any form or document in
order to establish the entitlement of the Holder to take advantage of such
method of disposition, the Company agrees, at the cost of the Holder, to
promptly take any necessary action or execute and file or deliver any necessary
form or document. Notwithstanding the foregoing, in no event will the Company be
obligated to effect a registration under the Act so as to permit the proposed
transfer of this Warrant.
(b) If, in the opinion of such counsel, the proposed transfer of this
Warrant may not be effected without registration of this Warrant under the Act,
the holder of this Warrant shall not be entitled to transfer this Warrant until
registration is effective.
ARTICLE V
PURCHASE PRICE
5.1 Determination of Purchase Price. The Purchase Price for any Warrant
Share purchasable hereunder shall be equal to $2.50 per share; provided,
however, if the Company shall divide its outstanding shares of Common Stock by
stock split, stock dividend or otherwise, the Purchase Price shall
proportionately decrease and if the Company shall combine its outstanding
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shares of Common Stock by stock combination, reverse split or otherwise, the
Purchase Price shall proportionately increase. Notwithstanding the provisions of
this Section 5. 1, in the event that the Company does not raise on or after May
1, 1996 and prior to July 1, 1997 an aggregate of Five Million Dollars
($5,000,000), net of sales fees and commissions, from an initial public
offering, sale or other placement of shares of the Common Stock or other capital
stock of Company, the Purchase Price shall be adjusted to equal the lesser of
(i) regardless of whether any Notes are outstanding, that amount which would
then constitute the Conversion Price under the Notes assuming for such purposes,
if necessary, Notes are outstanding, or (ii) the amount which would then
constitute the Purchase Price hereunder without reference to any Purchase Price
established under (i) hereof.
5.2 Notice to Holder. Upon any adjustment to the Purchase Price
required hereunder, the Company will provide the Holder hereof with written
notice of the current Purchase Price existing under this Warrant.
ARTICLE VI
NUMBER OF WARRANT SHARES
The number of Warrant Shares issuable hereunder shall be ___________;
provided, however, if the Company shall divide its outstanding shares of Common
Stock by stock split, stock dividend or otherwise, the number of Warrant Shares
then issuable hereunder shall proportionately increase and if the Company shall
combine its outstanding shares of Common Stock by stock combination, reverse
split or otherwise, the number of Warrant Shares then issuable hereunder shall
proportionately decrease.
ARTICLE VII
RECLASSIFICATION, REORGANIZATION OR MERGER
In case of any reclassification, capital reorganization or other change
of outstanding shares of Common Stock of the Company, or in case of any
consolidation or merger of the Company with or into another corporation (other
than a merger with a subsidiary in which merger the Company is the continuing
corporation or which does not result in any reclassification, capital
reorganization or other change of outstanding shares of Common Stock), the
Company shall cause effective provision to be made so that the Holder hereof
shall have the right thereafter by exercising this Warrant to purchase the kind
and amount of shares of stock and other securities and property receivable upon
such reclassification, capital reorganization or other change, consolidation or
merger, as such holder would have been entitled to receive had such holder
exercised this Warrant immediately prior to such reclassification, change,
consolidation or merger. Any such provision shall include provision for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments, herein provided, of the Purchase Price 'and the number of Warrant
Shares purchasable and receivable upon the
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exercise of this Warrant. The foregoing provisions of this Article VII shall
similarly apply to successive reclassification, capital reorganizations and
changes of shares of Common Stock and to successive consolidations and mergers.
ARTICLE VIII
DISTRIBUTIONS, LIQUIDATION OR DISSOLUTION
8.1 Certain Distributions. In case the Company shall, at any time,
prior to the Expiration Date set forth in Article IX hereof, make any
distribution of its assets to holders of its capital stock as a partial
liquidation distribution or by way of return of capital, other than as a
dividend payable out of earnings or any surplus legally available for dividends
under the laws of the State of Delaware, then the Holder, upon the exercise of
this Warrant prior to any such distribution but after the date of record for the
determination of those holders of capital stock entitled to such distribution of
assets, shall be entitled to receive, in addition to the shares of Common Stock
issuable on such exercise, upon such distribution the amount of such assets (or
at the option of the Company a sum equal to the value thereof at the time of
such distribution to holders of capital stock as such value is determined by the
Board of Directors of the Company in good faith), which would have been payable
to the holder had it been the holder of record of such shares of capital stock
on the record date for the determination of those holders of capital stock
entitled to such distribution.
8.2 Dissolution or Liquidation. In case the Company shall, at any time
prior to the Expiration Date set forth in Article IX hereof, dissolve, liquidate
or wind up its affairs, the Holder shall be entitled, upon the exercise of this
Warrant and prior to any such distribution in dissolution of liquidation, to
receive on such exercise, in lieu of the shares of Common Stock which the Holder
would have been entitled to receive, the same kind and amount of assets as would
have been distributed or paid to the Holder upon any such dissolution,
liquidation or winding up, with respect to such shares of Common Stock had the
holder been the Holder of record of such shares of Common Stock on the record
date for the determination of those holders of Common Stock entitled to receive
any such liquidation distribution.
ARTICLE IX
EXPIRATION
This Warrant shall terminate at 5:00 p.m. Eastern time on April 30,
2001. The Company shall give, by first class mail, postage prepaid, addressed to
the Holder, at the address of the Holder as shown on the books of the Company at
least twenty (20) days prior written notice of (i) the date on which the books
of the Company shall close for determining rights to vote in respect of any
merger, consolidation or transfer of assets which would result in the expiration
of this Warrant and (ii) in reference to a merger, consolidation, or transfer of
assets of the Company, the date on which the holders of Common Stock shall be
entitled to exchange their shares for securities or property resulting from such
merger, consolidation or transfer of assets.
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ARTICLE X
CERTAIN COVENANTS OF THE COMPANY
The Company covenants and agrees that it will reserve and set apart and
have at all times, free from preemptive rights, a number of shares of Common
Stock or other securities or property deliverable upon the exercise of this
Warrant sufficient to enable it at any time to fulfill all its obligations
hereunder.
ARTICLE XI
MISCELLANEOUS
11.1 Entire Agreement. This Warrant contains the entire agreement
between the holder hereof and the Company with respect to the purchase of the
Warrant Shares and supersedes all prior arrangements or understandings with
respect thereto.
11.2 Waiver and Amendment, This Warrant is one of several Common Stock
Warrants issued pursuant to that certain Note and Warrant Purchase Agreement,
dated as of May 8, 1996, by and among the Company and the Investors party
thereto (the "Common Stock Warrants"). Any term or provision of this Warrant may
be waived at any time and any term or provision of this Warrant may be amended
or supplemented at any time by agreement of the holders of those Common Stock
Warrants representing more than fifty percent (50%) of all Warrant Shares then
issuable upon exercise of all such outstanding Common Stock Warrants and the
Company, except that any waiver of any term or condition, or any amendment or
supplementation, of this Warrant must be in writing and except that no change in
the number of shares issuable upon exercise, the rights in liquidation or
distribution, the purchase price upon exercise and the provisions of this
Section 11.2 shall be effective without the written consent of each Warrant
holder affected thereby. A waiver of any breach or failure to enforce any of the
terms or conditions of this Warrant shall not in any way affect, limit or waive
a party's rights hereunder at any time to enforce strict compliance thereafter
with any term or condition of this Warrant.
11.3 Illegality. In the event that any one or more of the provisions
contained in this Warrant shall be determined to be invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in any other respect and the remaining
provisions of this Warrant shall not, at the election of the party for whom the
benefit of the provision exists, be in any way impaired.
11.4 Filing of Warrant. A copy of this Warrant shall be filed in the
records of the Company.
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11.5 Notice. Any notice or other document required or permitted to be
given or delivered to the Holder hereof shall be delivered, including by a
nationally recognized overnight courier service, or sent by certified or
registered mail, to such Holder at the last address shown on the books of the
Company maintained at the Warrant Office for the registration of, and the
registration of transfer of, the Warrant or at any more recent address of which
any holder hereof shall have notified the Company in writing. Any notice or
other document required or permitted to be given or delivered to the Company,
shall be delivered, including by a nationally recognized overnight courier
service, at, or sent by certified or registered mail to, the Warrant Office,
attention: President, or such other address within the United States of America
as shall have been furnished by the Company to the Holder hereof.
11.6 Limitation of Liability: Not Stockholders. No provision of this
Warrant shall be construed as conferring upon the Holder hereof the right to
vote, consent, receive dividends or receive notice other than as herein
expressly provided in respect of meetings of stockholders for the election of
directors of the Company or any other matter whatsoever as a stockholder of the
Company. No provision hereof, in the absence of affirmative action by the Holder
hereof to purchase Warrant Shares, and no enumeration herein of the rights or
privileges of the Holder hereof, shall give rise to any liability of such Holder
for the purchase price of any Warrant Shares or as a stockholder of the Company,
whether such liability is asserted by the Company or by creditors of the
Company.
11.7 Loss, Destruction, Etc, of Warrant. Upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft, mutilation or
destruction of the Warrant, and in the case of any such loss, theft or
destruction, upon delivery of a bond of indemnity in such form and amount as
shall be reasonably satisfactory to the Company, or in the event of such
mutilation, upon surrender and cancellation of the Warrant, the Company will
make and deliver a new Warrant, of like tenor, in lieu of such lost, stolen,
destroyed or mutilated Warrant. Any Warrant issued under the provisions of this
Section 11.7 in lieu of any Warrant alleged to be lost, destroyed or stolen, or
in lieu of any mutilated Warrant, shall constitute an original contractual
obligation on the part of the Company.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed in
its name by its Chairman and CEO and its corporate said to be impressed hereon
and attested by its Secretary.
THE COMPANY:
ONLINE RESOURCES &
COMMUNICATIONS CORPORATION
By:
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Chairman and CEO
Attest:
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Secretary
[Corporate Seal]
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EXHIBIT 2.1
WARRANT
SUBSCRIPTION NOTICE
Dated ___________
The undersigned hereby irrevocably elects to exercise its right to
purchase __________ shares of the Common Stock, $.0001 par value per share, of
Online Resources & Communications Corporation, such right being pursuant to a
Warrant dated ________________________, 1996, and as issued to the undersigned
by Online Resources & Communications Corporation, and remits herewith the sum of
$ ___________________ in payment for same in accordance with the Purchase Price
specified in such Warrant.
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name
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(Please typewrite or print in block letters)
Address
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Signature
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Shares Heretofore Purchased
Under Warrant
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