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EXHIBIT 10.10
THIS WARRANT AND THE SHARES OF SERIES A CONVERTIBLE
PREFERRED STOCK ISSUED UPON ITS EXERCISE ARE SUBJECT TO
THE RESTRICTIONS ON TRANSFER SET FORTH IN SECTION 4 OF THIS
WARRANT
Warrant No. A-1 Number of Shares: 21,250
(subject to adjustment)
Date of Issuance: July 27, 1999
XxxxxxxXxxxxx.xxx, Inc.
Series A Convertible Preferred Stock Purchase Warrant
(Void after July 27, 2004)
XxxxxxxXxxxxx.xxx, Inc., a Delaware corporation (the "Company"), for
value received, hereby certifies that Xxxxxx Xxxxxx Partners LLC, or its
registered assigns (the "Registered Holder"), is entitled, subject to the terms
set forth below, to purchase from the Company, at any time or from time to time
on or after the date of issuance and on or before July 27, 2004 at not later
than 5:00 p.m. (New York City time) (the "Expiration Time"), 21,250 shares of
the Company's Series A Convertible Preferred Stock, $0.01 par value per share
(the "Preferred Stock"), at a purchase price of $14.08 per share. In the event
that the Preferred Stock is converted into the Company's Class A Common Stock,
$0.01 par value per share, or any successor class of stock (the "Class A Common
Stock"), this Warrant shall be exercisable for the Class A Common Stock (such
event, the "Conversion Event"). The shares purchasable upon exercise of this
Warrant, and the purchase price per share, each as adjusted from time to time
pursuant to the provisions of this Warrant, are hereinafter referred to as the
"Warrant Shares" and the "Purchase Price," respectively. "Capital Stock" shall
mean the Preferred Stock for all purposes prior to the Conversion Event, and
shall mean the Class A Common Stock for all purposes on and after the Conversion
Event.
1. Exercise.
(a) This Warrant may be exercised by the Registered Holder, in
whole or in part, by surrendering this Warrant, with the purchase form appended
hereto as Exhibit I duly executed by such Registered Holder or by such
Registered Holder's duly authorized attorney, at the principal office of the
Company, or at such other office or agency as the Company may designate,
accompanied by payment in full, in lawful money of the United States, of the
Purchase Price payable in respect of the number of Warrant Shares purchased upon
such exercise.
(b) The Registered Holder may, at its option, elect to pay
some or all of the Purchase Price payable upon an exercise of this Warrant by
canceling a portion of this Warrant
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exercisable for such number of Warrant Shares as is determined by dividing (i)
the total Purchase Price payable in respect of the number of Warrant Shares
being purchased upon such exercise by (ii) the excess of the Fair Market Value
per share of Capital Stock as of the effective date of exercise, as determined
pursuant to subsection 1(d) below (the "Exercise Date") over the Purchase Price
per share. If the Registered Holder wishes to exercise this Warrant pursuant to
this method of payment with respect to the maximum number of Warrant Shares
purchasable pursuant to this method, then the number of Warrant Shares so
purchasable shall be equal to the total number of Warrant Shares, minus the
product obtained by multiplying (x) the total number of Warrant Shares by (y) a
fraction, the numerator of which shall be the Purchase Price per share and the
denominator of which shall be the Fair Market Value per share of Capital Stock
as of the Exercise Date. The Fair Market Value per share of Capital Stock shall
be determined as follows:
(i) If the Capital Stock is listed on a national
securities exchange, the Nasdaq National Market, the Nasdaq system, or another
nationally recognized exchange or trading system as of the Exercise Date, the
Fair Market Value per share of Capital Stock shall be deemed to be the last
reported sale price per share of Capital Stock thereon on the Exercise Date; or,
if no such price is reported on such date, such price on the next preceding
business day (provided that if no such price is reported on the next preceding
business day, the Fair Market Value per share of Capital Stock shall be
determined pursuant to clause (ii)).
(ii) If the Capital Stock is not listed on a national
securities exchange, the Nasdaq National Market, the Nasdaq system or another
nationally recognized exchange or trading system as of the Exercise Date, the
Fair Market Value per share of Capital Stock shall be deemed to be the amount
most recently determined by the Board of Directors to represent the fair market
value per share of the Capital Stock; and, upon request of the Registered
Holder, the Board of Directors (or a representative thereof) shall promptly
notify the Registered Holder of the Fair Market Value per share of Capital
Stock. Notwithstanding the foregoing, if the Board of Directors has not made
such a determination within the three-month period prior to the Exercise Date,
then (A) the Fair Market Value per share of Capital Stock shall be the amount
next determined by the Board of Directors to represent the fair market value per
share of the Capital Stock, (B) the Board of Directors shall make such a
determination within 15 days of a request by the Registered Holder that it do
so, and (C) the exercise of this Warrant pursuant to this subsection 1(b) shall
be delayed until such determination is made.
(c) The Registered Holder may, at its option, when permitted
by law and applicable regulations (including the rules of the Nasdaq National
Market and the National Association of Securities Dealers, Inc. ("NASD")), elect
to pay some or all of the Purchase Price payable upon the exercise of this
Warrant through a "same day sale" commitment from the Registered Holder (and, if
applicable, a broker-dealer that is a member of NASD ("NASD Dealer")), whereby
the Registered Holder irrevocably elects to exercise this Warrant and to sell at
least that number of Warrant Shares so purchased to pay the aggregate Purchase
Price (and up to all of the Warrant Shares so purchased) and the Registered
Holder (or, if applicable, the NASD Dealer) commits upon sale (or, in the case
of the NASD Dealer, upon receipt) of such Warrant Shares to forward the
aggregate Purchase Price directly to the Company, with any proceeds in excess of
the aggregate Purchase Price being for the benefit of the Registered Holder.
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(d) Each exercise of this Warrant shall be deemed to have been
effected immediately prior to the close of business on the day on which this
Warrant shall have been surrendered to the Company as provided in subsection
1(a) above. At such time, the person or persons in whose name or names any
certificates for Warrant Shares shall be issuable upon such exercise as provided
in subsection 1(e) below shall be deemed to have become the holder or holders of
record of the Warrant Shares represented by such certificates.
(e) As soon as practicable after the exercise of this Warrant
in full or in part, and in any event within 10 days thereafter, the Company, at
its expense, will cause to be issued in the name of, and delivered to, the
Registered Holder, or as such Holder (upon payment by such Holder of any
applicable transfer taxes) may direct:
(i) a certificate or certificates for the number of
full Warrant Shares to which such Registered Holder shall be entitled upon such
exercise plus, in lieu of any fractional share to which such Registered Holder
would otherwise be entitled, cash in an amount determined pursuant to Section 3
hereof; and
(ii) in case such exercise is in part only, a new
warrant or warrants (dated the date hereof) of like tenor, calling in the
aggregate on the face or faces thereof for the number of Warrant Shares equal
(without giving effect to any adjustment therein) to the number of such shares
called for on the face of this Warrant minus the sum of (a) the number of such
shares purchased by the Registered Holder upon such exercise plus (b) the number
of Warrant Shares (if any) covered by the portion of this Warrant cancelled in
payment of the Purchase Price payable upon such exercise pursuant to subsections
1(b) or 1(c) above.
2. Adjustments.
(a) If outstanding shares of the Company's Capital Stock shall
be subdivided into a greater number of shares or a dividend in Capital Stock
shall be paid in respect of Capital Stock, the Purchase 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 Capital Stock shall be combined into a smaller number of
shares, the Purchase Price in effect immediately prior to such combination
shall, simultaneously with the effectiveness of such combination, be
proportionately increased. When any adjustment is required to be made in the
Purchase Price, the number of Warrant Shares 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 Purchase Price in effect
immediately prior to such adjustment, by (ii) the Purchase Price in effect
immediately after such adjustment.
(b) If there shall occur any capital reorganization or
reclassification of the Company's Capital Stock (other than a change in par
value or a subdivision or combination as provided for in subsection 2(a) above),
or any consolidation or merger of the Company with or into another corporation,
or a transfer of all or substantially all of the assets of the Company,
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then, as part of any such reorganization, reclassification, consolidation,
merger or sale, as the case may be, lawful provision shall be made so that the
Registered Holder of this Warrant shall have the right thereafter to receive
upon the exercise hereof the kind and amount of shares of stock or other
securities or property which such Registered Holder would have been entitled to
receive if, immediately prior to any such reorganization, reclassification,
consolidation, merger or sale, as the case may be, such Registered Holder had
held the number of shares of Capital Stock which were then purchasable upon the
exercise of this Warrant. In any such case, appropriate adjustment (as
reasonably determined in good faith by the Board of Directors of the Company)
shall be made in the application of the provisions set forth herein with respect
to the rights and interests thereafter of the Registered Holder of this Warrant,
such that the provisions set forth in this Section 2 (including provisions with
respect to adjustment of the Purchase Price) shall thereafter be applicable, as
nearly as is reasonably practicable, in relation to any shares of stock or other
securities or property thereafter deliverable upon the exercise of this Warrant.
(c) When any adjustment is required to be made in the Purchase
Price, the Company shall promptly mail to the Registered Holder a certificate
setting forth the Purchase Price after such adjustment and setting forth a brief
statement of the facts requiring such adjustment. Such certificate shall also
set forth the kind and amount of stock or other securities or property into
which this Warrant shall be exercisable following the occurrence of any of the
events specified in subsections 2(a) or (b) above.
3. Fractional Shares. The Company shall not be required upon the
exercise of this Warrant to issue any fractional shares, but shall make an
adjustment therefor in cash on the basis of the Fair Market Value per share of
Capital Stock, as determined pursuant to subsection 1(b) above.
4. Requirements for Transfer.
(a) This Warrant and the Warrant Shares shall not be sold or
transferred unless either (i) they first shall have been registered under the
Securities Act of 1933, as amended (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.
(b) Notwithstanding the foregoing, no registration or opinion
of counsel shall be required for (i) a transfer by a Registered Holder which is
a partnership to a partner of such partnership or a retired partner of such
partnership who retires after the date hereof, or to the estate of any such
partner or retired partner, if the transferee agrees in writing to be subject to
the terms of this Section 4, (ii) a transfer by a Registered Holder which is a
limited liability company to a member of such limited liability company or a
retired member of such limited liability company who retires after the date
hereof, or to the estate of any such member or retired member, or (iii) a
transfer made in accordance with Rule 144 under the Act.
(c) Each certificate representing Warrant Shares shall bear a
legend substantially in the following form:
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"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and
may not be offered, sold or otherwise transferred, pledged or
hypothecated unless and until such securities are registered
under such Act or an opinion of counsel satisfactory to the
Company is obtained to the effect that such registration is
not required."
The foregoing legend shall be removed from the certificates representing any
Warrant Shares, at the request of the holder thereof, at such time as they
become eligible for resale pursuant to Rule 144(k) under the Act.
5. No Impairment. The Company will not, by amendment of its
charter or through reorganization, consolidation, merger, dissolution, sale of
assets or any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times in good
faith assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the
holder of this Warrant against impairment.
6. Liquidating Dividends. If the Company pays a dividend or makes
a distribution on the Capital Stock payable otherwise than in cash out of
earnings or earned surplus (determined in accordance with generally accepted
accounting principles) except for a stock dividend payable in shares of Capital
Stock (a "Liquidating Dividend"), then the Company will pay or distribute to the
Registered Holder of this Warrant, upon the exercise hereof, in addition to the
Warrant Shares purchased upon such exercise, the Liquidating Dividend which
would have been paid to such Registered Holder if he had been the owner of
record of such Warrant Shares immediately prior to the date on which a record is
taken for such Liquidating Dividend or, if no record is taken, the date as of
which the record holders of Capital Stock entitled to such dividends or
distribution are to be determined.
7. Notices of Record Date, etc. In case:
(a) the Company shall take a record of the holders of its
Capital Stock (or other stock or securities at the time deliverable upon the
exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution, or to receive any right to subscribe
for or purchase any shares of stock of any class or any other securities, or to
receive any other right; or
(b) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company with or into another corporation (other than a
consolidation or merger in which the Company is the surviving entity), or any
transfer of all or substantially all of the assets of the Company; or
(c) of the voluntary or involuntary dissolution, liquidation
or winding-up of the Company,
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then, and in each such case, the Company will mail or cause to be mailed to the
Registered Holder of this Warrant a notice specifying, as the case may be, (i)
the date on which a record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such dividend,
distribution or right, or (ii) the effective date on which such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up is to take place, and the time, if any is to be fixed, as of which
the holders of record of Capital Stock (or such other stock or securities at the
time deliverable upon the exercise of this Warrant) shall be entitled to
exchange their shares of Capital Stock (or such other stock or securities) for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up. Such notice shall be mailed at least ten (10) days prior to the
record date or effective date for the event specified in such notice.
8. Reservation of Stock. The Company will at all times reserve
and keep available, solely for issuance and delivery upon the exercise of this
Warrant, such number of shares of Preferred Stock and/or Class A Common Stock,
as the case may be, and other stock, securities and property, as from time to
time shall be issuable upon the exercise of this Warrant.
9. Exchange of Warrants. Upon the surrender by the Registered
Holder of any Warrant or Warrants, properly endorsed, to the Company at the
principal office of the Company, the Company will, subject to the provisions of
Section 4 hereof, issue and deliver to or upon the order of such Holder, at the
Company's expense, a new Warrant or Warrants of like tenor, in the name of such
Registered Holder or as such Registered Holder (upon payment by such Registered
Holder of any applicable transfer taxes) may direct, calling in the aggregate on
the face or faces thereof for the number of shares of Capital Stock called for
on the face or faces of the Warrant or Warrants so surrendered.
10. Replacement of Warrants. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.
11. Transfers, etc.
(a) The Company will maintain a register containing the names
and addresses of the Registered Holders of this Warrant. Any Registered Holder
may change its or his address as shown on the warrant register by written notice
to the Company requesting such change.
(b) Subject to the provisions of Section 4 hereof, this
Warrant and all rights hereunder are transferable, in whole or in part, upon
surrender of this Warrant with a properly executed assignment (in the form of
Exhibit II hereto) at the principal office of the Company.
(c) Until any transfer of this Warrant is made in the warrant
register, the Company may treat the Registered Holder of this Warrant as the
absolute owner hereof for all
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purposes; provided, however, that if and when this Warrant is properly assigned
in blank, the Company may (but shall not be obligated to) treat the bearer
hereof as the absolute owner hereof for all purposes, notwithstanding any notice
to the contrary.
12. Mailing of Notices, etc. All notices and other communications
from the Company to the Registered Holder of this Warrant shall be mailed by
overnight courier, first-class, certified or registered mail, postage prepaid,
to the address furnished to the Company in writing by the last Registered Holder
of this Warrant who shall have furnished an address to the Company in writing.
All notices and other communications from the Registered Holder of this Warrant
or in connection herewith to the Company shall be mailed by overnight courier,
first-class, certified or registered mail, postage prepaid, to the Company at
its principal office. If the Company should at any time change the location of
its principal office, it shall give prompt written notice to the Registered
Holder of this Warrant and thereafter all references in this Warrant to the
location of its principal office at the particular time shall be as so specified
in such notice.
13. No Rights as Stockholder. Until the exercise of this Warrant,
the Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a stockholder of the Company.
14. Change or Waiver. Any term of this Warrant may be changed or
waived only by an instrument in writing signed by the party against which
enforcement of the change or waiver is sought.
15. Headings. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
16. Governing Law. This Warrant will be governed by and construed
in accordance with the internal laws of the State of New York without giving
effect to its conflict-of-laws rules.
17. HSR Act. The Company hereby acknowledges that the exercise of
this Warrant by the Registered Holder may subject the Company and/or the
Registered Holder to the filing requirements of the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), and that the Registered
Holder may be prevented from exercising this Warrant until the expiration or
early termination of all waiting periods imposed by the HSR Act (the "HSR Act
Restrictions"). If on or before the Expiration Time, the Registered Holder has
sent the Purchase Form, attached hereto as Exhibit I, to the Company and the
Registered Holder has not been able to complete the exercise of this Warrant
prior to the Expiration Time because of HSR Act Restrictions, the Registered
Holder shall be entitled to complete the process of exercising this Warrant in
accordance with the procedures contained herein, notwithstanding the fact that
completion of the exercise of this Warrant would take place after the Expiration
Time.
XXXXXXXXXXXXX.XXX, INC.
By:________________________________
Title:_____________________________
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EXHIBIT I
PURCHASE FORM
To:_________________ Dated:______________
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. ___), hereby irrevocably elects to purchase _____ shares of the
_______ Stock covered by such Warrant. The undersigned herewith makes payment of
$____________, representing the full purchase price for such shares at the price
per share provided for in such Warrant. Such payment takes the form of (check
applicable box or boxes):
[ ] $_________ in lawful money of the United States, and/or
[ ] the cancellation of such portion of the attached Warrant
as is exercisable for a total of ______ Warrant Shares
(using a Fair Market Value of $_______ per share for
purposes of this calculation).
Signature:__________________________
Address:____________________________
____________________________
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EXHIBIT II
ASSIGNMENT FORM
FOR VALUE RECEIVED, ________________________________________
hereby sells, assigns and transfers all of the rights of the undersigned under
the attached Warrant (No. ____) with respect to the number of shares of _______
Stock covered thereby set forth below, unto:
Name of Assignee Address No. of Shares
---------------- ------- -------------
Dated:______________ Signature:_______________________________
Dated:______________ Witness:_________________________________
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