THIS WARRANT AND THE SHARES OF COMMON STOCK PURCHASABLE UPON EXERCISE OF THIS
WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS RELATING TO SUCH SECURITIES
OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO BOUNDLESS CORPORATION THAT
SUCH REGISTRATION IS NOT REQUIRED.
Right to Purchase 50,000 Shares of
Common Stock of Boundless Corporation (subject
to adjustment as provided herein).
COMMON STOCK PURCHASE WARRANT
April 14, 1999
Boundless Corporation, a corporation organized under the laws of the
State of Delaware (the "Company"), hereby certifies that, for value received,
The Chase Manhattan Bank or registered assigns (the "Holder"), is entitled,
subject to the terms set forth below, to purchase from the Company at any time
or from time to time before 5:00 p.m., New York time, on April 14, 2004 (the
"Expiration Date"), up to 50,000 fully paid and nonassessable shares of Warrant
Stock (as hereinafter defined), $.01 par value per share, of the Company, at a
purchase price determined as follows: (a) $4.50 per share, for up to 35,000
shares and (b) $7.00 per share, for up to an additional 15,000 shares (such
purchase price per share as adjusted from time to time as herein provided is
referred to herein as the "Purchase Price"). The number and character of such
shares of Warrant Stock and the Purchase Price are subject to adjustment as
provided herein.
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
(a) The term "Company" shall include Boundless Corporation and any
corporation which shall succeed or assume the obligations of Boundless
Corporation hereunder.
(b) The term "Common Stock" includes (i) the Company's Common Stock,
$.01 par value per share, as authorized on the date of the Agreement, and (ii)
any other securities into which or for which any of the securities described in
(i) may be converted or exchanged pursuant to a plan of recapitalization,
reorganization, merger, sale of assets or otherwise.
(c) The term "Other Securities" refers to any stock (other than Common
Stock) and other securities of the Company or any other person (corporate or
otherwise) which the Holder at any time shall be entitled to receive, or shall
have received, on the exercise of the Warrant, in lieu of or in addition to
Common Stock, or which at any time shall be issuable or shall have been issued
in exchange for or in replacement of Common Stock or Other Securities pursuant
to Section 5 or otherwise.
(d) The term "Warrant Stock" means the shares of Common Stock and Other
Securities owned or to be owned upon exercise of this Warrant and all other
warrants in substantially the same form as this Warrant issued to The Chase
Manhattan Bank (successor by merger to The Chase Manhattan Bank, N.A.) in March
1998 or thereafter to its Transferees.
1. Exercise of Warrant.
1.1 Number of Shares Issuable upon Exercise. The Holder shall
be entitled to receive, upon exercise of this Warrant in whole in accordance
with the terms of subsection 1.2 or upon exercise of this Warrant in part in
accordance with subsection 1.3, shares of Warrant Stock, subject to adjustment
pursuant to Section 5.
1.2 Full Exercise. This Warrant may be exercised in full by
the Holder by surrender of this Warrant, with the form of subscription attached
as Exhibit A hereto (the Subscription Form") duly executed by the Holder, to the
Company at its principal office or at the office of its Warrant agent (as
1
provided in Section 11), accompanied by payment either (a) in cash or by
certified or official bank check payable to the order of the Company, in the
amount obtained by multiplying the number of shares of Warrant Stock for which
this Warrant is then exercisable by the Purchase Price then in effect or, (b)
the surrender to the Company of securities of the Company having an aggregate
Fair Market Value equal to the aggregate Purchase Price of the shares of Warrant
Stock being purchased upon such exercise; provided, however, that in lieu of the
method of payment under clauses (a) or (b) of this Section 1.2, the Holder may
make payment by allowing the Company to deduct from the number of shares of
Warrant Stock deliverable upon such exercise of this Warrant a number of shares
which has an aggregate Fair Market Value determined as of the date of such
exercise of this Warrant equal to the aggregate Purchase Price for all shares as
to which this Warrant is then being exercised.
1.3 Partial Exercise. This Warrant may be exercised in part
(but not for a fractional share) by surrender of this Warrant in the manner and
at the place provided in subsection 1.2 except that the amount payable by the
Holder on such partial exercise shall be the amount obtained by multiplying (a)
the number of shares of Warrant Stock designated by the Holder in the
Subscription Form by (b) the Purchase Price then in effect. The method of
payment shall be as permitted by Section 1.2. On any such partial exercise, the
Company, at its expense, will forthwith issue and deliver to, or upon the order
of, the Holder a new Warrant of like tenor, in the name of the Holder hereof or
as the Holder (upon payment by such Holder of any applicable transfer taxes),
may request, subject to compliance with applicable securities laws, the number
of shares of Warrant Stock for which such Warrant may still be exercised.
1.4 Fair Market Value. Fair Market Value of a share of Warrant
Stock as of a particular date (the "Determination Date") shall mean:
(a) If the Warrant Stock is traded on an exchange or
is quoted on the National Association of Securities Dealers, Inc.
Automated Quotation ("NASDAQ") National Market System, then the the
average of the closing or last sale price, respectively, reported for
the five business days immediately preceding the Determination Date.
(b) If the Warrant Stock is not traded on an exchange
or on the NASDAQ National Market System but is traded in the
over-the-counter market or other similar organization (including the
Bulletin Board), then the average of the closing bid and asked prices
reported for the five business days immediately preceding the
Determination Date.
(c) If the Warrant Stock is not traded as provided
above, then the price determined in good faith by the Board of
Directors of the Company, provided that (1) the basis or bases of each
such determination shall be set forth in the corporate records of the
Company pertaining to meetings and other actions of such board, and (2)
such records are available to the Holder for inspection during normal
business hours of the Company upon the giving of reasonable prior
notice.
(d) If the Determination Date is the date of a
liquidation, dissolution or winding up, or any event deemed to be a
liquidation, dissolution or winding up pursuant to the Company's
charter, then all amounts to be payable per share to Holders of the
securities then comprising Warrant Stock pursuant to the charter in the
event of such liquidation, dissolution or winding up, plus all other
amounts to be payable per share in respect of the Warrant Stock in
liquidation under the charter, assuming for the purposes of this clause
(d) that all of the shares of Warrant Stock then issuable upon exercise
of all of the Warrants are outstanding at the Determination Date.
1.5 Company Acknowledgement. The Company will, at the time of
the exercise of this Warrant, upon the request of the Holder acknowledge in
writing its continuing obligation to afford to the Holder any rights to which
the Holder shall continue to be entitled after such exercise in accordance with
the provisions of this Warrant. If the Holder shall fail to make any such
request, such failure shall not affect the continuing obligation of the Company
to afford to the Holder any such rights.
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1.6 Trustee for Warrant Holders. In the event that a bank or
trust company shall have been appointed as trustee for the Holder pursuant to
subsection 4.2, such bank or trust company shall have all the powers and duties
of a warrant agent appointed pursuant to Section 11 and shall accept, in its own
name for the account of the Company or such successor person as may be entitled
thereto, all amounts otherwise payable to the Company or such successor, as the
case may be, on exercise of this Warrant pursuant to this Section 1.
2. Delivery of Stock Certificates, etc. on Exercise. The Company agrees
that the shares of Warrant Stock purchased upon exercise of this Warrant shall
be deemed to be issued to the Holder as the record owner of such shares as of
the close of business on the date on which this Warrant shall have been
surrendered and payment made for such shares as aforesaid. 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 (including the
payment by it of any applicable issue taxes) will cause to be issued in the name
of and delivered to the Holder, or as the Holder (upon payment by such Holder of
any applicable transfer taxes) may direct, subject to compliance with applicable
securities laws, a certificate or certificates for the number of duly and
validly issued, fully paid and nonassessable shares of Warrant Stock to which
the Holder shall be entitled on such exercise, plus, in lieu of any factional
share to which the Holder would otherwise be entitled, cash equal to such
fraction multiplied by the then Fair Market Value of one full share, together
with any other stock or other securities and property (including cash, where
applicable) to which the Holder is entitled upon such exercise pursuant to
Section 1 or otherwise.
3. Adjustment for Dividends in Other Stock, Property, Reclassification,
etc. In case at any time or from time to time, the Holders of securities then
comprising Warrant Stock shall have received, or (on or after the record date
fixed for the determination of shareholders eligible to receive) shall have
become entitled to receive, without payment therefor,
(a) other or additional stock or other securities or
property (other than cash) by way of dividend, or
(b) any cash (excluding cash dividends payable solely
out of earnings or earned surplus of the Company), or
(c) other or additional stock or other securities or
property (including cash) by way of spin-off, split-up,
reclassification, recapitalization, combination of shares or similar
corporate rearrangement other than additional shares of Warrant Stock
issued as a stock dividend or in a stock split (adjustments in respect
of which are provided for in Section 5),
then and in each such case the Holder, on the exercise hereof as provided in
Section 1, shall be entitled to receive the amount of stock and other securities
and property (including cash in the cases referred to in subdivisions (b) and
(c) of this Section 3) which the Holder would hold on the date of such exercise
if on the date hereof the Holder had been the holder of record of the number of
shares of Warrant Stock called for on the face of this Warrant and had
thereafter, during the period from the date hereof to and including the date of
such exercise, retained such shares and all such other or additional stock and
other securities and property (including cash in the cases referred to in
subdivisions (b) and (c) of this Section 3) receivable by the Holder as
aforesaid during such period, giving effect to all adjustments called for during
such period by Section 4 and 5.
4. Adjustment for Reorganization, Consolidation, Merger, etc.
4.1 Reorganization, Consolidation, Merger etc. In case at any
time or from time to time, the Company shall (a) effect a reorganization, (b)
consolidate with or merge into any other person, or (c) transfer all or
substantially all of its properties or assets to any other person under any plan
or arrangement contemplating the dissolution of the Company, then, in each such
case, as a condition to the consummation of such a transaction, proper and
adequate provision shall be made by the Company whereby the Holder, on the
exercise hereof as provided in Section 1 at any time after the consummation of
such reorganization, consolidation or merger or the effective date of such
dissolution, as the case may be, shall receive, in lieu of the Warrant Stock
3
issuable on such exercise prior to such consummation or such effective date, the
stock and other securities and property (including cash) to which the Holder
would have been entitled upon such consummation or in connection with such
dissolution, as the case may be, if the Holder had so exercised this Warrant,
immediately prior thereto, all subject to further adjustment thereafter as
provided in Sections 3 and 5.
4.2 Dissolution. In the event of any dissolution of the
Company following the transfer of all or substantially all of its properties or
assets in a transaction contemplated by Section 4.1(c), the Company,
simultaneously with such dissolution, shall distribute or cause to be
distributed to the Holder the stock and other securities and property (including
cash, were applicable) which would be receivable by the Holder if the Holder had
exercised its Warrant in full immediately prior to such dissolution, less an
amount of stock, other securities, property and cash with a value equal to the
Purchase Price.
4.3 Continuation of Terms. Upon any reorganization,
consolidation, merger or transfer referred to in this Section 4, this Warrant
shall continue in full force and effect and the terms hereof shall be applicable
to the shares of stock and other securities and property receivable on the
exercise of this Warrant after the consummation of such reorganization,
consolidation or merger, as the case may be, and shall be binding upon the
issuer of any such stock or other securities, including, in the case of any such
transfer, the person acquiring all or substantially all of the properties or
assets of the Company, whether or not such person shall have expressly assumed
the terms of this Warrant as provided in Section 6.
5. Extraordinary Events Regarding Warrant Stock. In the event that the
Company shall (a) issue additional shares of the Warrant Stock as a dividend or
other distribution on outstanding Warrant Stock, (b) subdivide its outstanding
shares of Warrant Stock, or (c) combine its outstanding shares of the Warrant
Stock into a smaller number of shares of the Warrant Stock, then, in each such
event, the Purchase Price shall, simultaneously with the happening of such
event, be adjusted by multiplying the then Purchase Price by a fraction, the
numerator of which shall be the number of shares of Warrant Stock outstanding
immediately prior to such event and the denominator of which shall be the number
of shares of Warrant Stock outstanding immediately after such event, and the
product so obtained shall thereafter be the Purchase Price then in effect. The
Purchase Price, as so adjusted, shall be readjusted in the same manner upon the
happening of any successive event or events described herein in this Section 5.
The number of shares of Warrant Stock that the Holder shall thereafter, on the
exercise hereof as provided in Section 1, be entitled to receive shall be
increased to a number determined by multiplying the number of shares of Warrant
Stock that would otherwise (but for the provisions of this Section 5) be
issuable on such exercise by a fraction of which (a) the numerator is the
Purchase Price that would otherwise (but for the provisions of this Section 5)
be in effect, and (b) the denominator is the Purchase Price in effect on the
date of such exercise.
6. Chief Financial Officer's Certificate as to Adjustments. In each
case of any adjustment or readjustment in the shares of Warrant Stock issuable
on the exercise of the Warrants, the Company at its expense will promptly cause
its Chief Financial Officer to compute such adjustment or readjustment in
accordance with the terms of the Warrant and prepare a certificate setting forth
such adjustment or readjustment and showing in detail the facts upon which such
adjustment or readjustment is based, including a statement of (a) the
consideration received or receivable by the Company for any additional shares of
Warrant Stock issued or sold or deemed to have been issued or sold, (b) the
number of shares of Warrant Stock outstanding or deemed to be outstanding, and
(c) the Purchase Price and the number of shares of Warrant Stock to be received
upon exercise of this Warrant, in effect immediately prior to such adjustment or
readjustment and as adjusted or readjusted as provided in this Warrant. The
Company will forthwith mail a copy of each such certificate to the Holder and
any Warrant agent of the Company (appointed pursuant to Section 11 hereof),
7. Reservation of Stock, Issuable on Exercise of Warrant. The Company
will at all times reserve and keep available, solely for issuance and delivery
on the exercise of this Warrant, all shares of Warrant Stock from time to time
issuable on the exercise of this Warrant.
4
8. Assignment, Exchange of Warrant. Subject to compliance with
applicable Securities laws, this Warrant, and the rights evidenced hereby, may
be transferred by the Holder (the "Transferor") with respect to any or all of
the shares of Warrant Stock underlying this Warrant. On the surrender for
exchange of this Warrant, with the Transferor's endorsement in the form of
Exhibit B attached hereto (the "Transferor Endorsement Form") to the Company,
the Company at its expense but with payment by the Transferor of any applicable
transfer taxes will issue and deliver to or on the order of the Transferor
thereof a new Warrant or Warrants of like tenor, in the name of the Transferor
and/or the transferee(s) specified in such Transferor Endorsement Form (each a
"Transferee"), calling in the aggregate on the face or faces thereof for the
number of shares of Warrant Stock called for on the face or faces of the Warrant
so surrendered by the Transferor. Each Transferee shall be entitled (pro rata
according to the number of shares of Warrant Stock issuable under the
Transferee's new Warrant) to those benefits accruing to the Transferor under
this Warrant prior to the date of issue of such new Warrant or Warrants.
9. Registration Rights: Procedure; Indemnification.
9.1 Registration Rights.
(a) On one occasion, on and after the time that this
Warrant first becomes exercisable but not later than the third
anniversary date of this Warrant, the Company, upon a written request
therefor from any registered holder or holders of more than 50% of the
total number of shares of Warrant Stock shall prepare and file a
registration statement with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the
"Securities Act"), covering the Warrant Stock that is the subject of
such request to the extent required to permit the sale or other
disposition of the Warrant Stock so registered by the holders thereof
(collectively, the "Seller"). The underwriter, if any, of an offering
registered pursuant to this Subsection 9.1(a) shall be selected by the
holders or persons entitled to be holders of at least a majority of the
Warrant Stock for which registration has been requested and shall be
reasonably acceptable to the Company. In the event the Warrant Stock is
included in a registration statement that includes securities to be
sold for the account of the Company, such written request for
registration shall be deemed to have been given pursuant to Subsection
9.1(b), rather than this Subsection 9.1(a), and the rights of the
holders of Warrant Stock covered by such written request shall be
governed by Subsection 9.1(b). In the event that the Company has
granted or hereafter grants to other holders of its securities the
right to participate in any registration requested by the holders of
the Warrant Stock pursuant to this Section 9.1(a), and the
underwriters, if any, of any such registered offering are of the
opinion that the inclusion of all shares requested to be included in
such registration would adversely affect the marketing of such shares,
then, the number of shares included in such offering shall be
determined on pro rata basis according to the total number of shares
requested to be included by each requesting party. However, if any
registration demanded under this Section 9.1(a) results in the
registration of less than 75% of the shares of Warrant Stock for which
registration was requested pursuant hereto, then the holders of the
Warrant and the Warrant Stock shall be deemed not to have utilized
their one-time right to demand such registration.
(b) On one occasion, on and after the time that this
Warrant first becomes exercisable, if the Company at any time proposes
to register any of its securities under the Securities Act for sale to
the public, whether for its own account or for the account of other
security Holders or both (except with respect to registration
statements on Forms X-0, X-0 or another form not available for
registering the Warrant Stock that may be acquired upon exercise of
this Warrant for sale to the public), each such time it will give at
least 45 days' prior written notice to the Holder of its intention so
to do. Upon the written request of the Holder, received by the Company
within 30 days after the giving of any such notice by the Company, to
register any of the Warrant Stock owned or to be owned by the Holder
pursuant to the exercise of this Warrant, the Company will cause such
Warrant Stock as to which registration shall have been so requested to
5
be included in the securities to be covered by the registration
statement proposed to be filed by the Company, all to the extent
required to permit the sale or other disposition of the Warrant Stock
so registered by the Seller. In the event that any registration
pursuant to this Section 9 shall be, in whole or in part, an
underwritten public offering of Warrant Stock, the number of shares of
Warrant Stock to be included in such an underwriting may be reduced by
the Company and the managing underwriter if and to the extent that the
Company and the underwriter shall be of the opinion that such inclusion
would adversely affect the marketing of the securities to be sold by
the Company therein; provided, however, that the Company shall notify
the Seller in writing of any such reduction. In the event that the
underwriters notify the Company that inclusion of shares of Warrant
Stock would adversely affect the marketing of the securities to be sold
by the Company, and, as a result of such determination, the holders of
the Warrants or shares of Warrant Stock are unable to include at least
75% of the shares for which registration was requested pursuant to this
Section 9.1(b), then holders of the Warrants and Warrants Stock shall
be deemed not to have utilized their one-time right to participate in a
registration by the Company of any of its securities. Notwithstanding
the forgoing provisions, the Company may withdraw any registration
statement referred to in this Section 9 without thereby incurring any
liability to the Seller.
(c) As a condition of registration pursuant to this
Section 9, the Company may require that this Warrant be exercised, to
the extent of the Warrant Stock to be registered, prior to the filing
of the registration statement in the event the Company's ability to use
a Form S-3 or similar form of registration statement is conditioned
upon the issuance of the stock to be registered prior to the filing of
the registration statement. Prior to exercising its right to require
the exercise of the Warrant contemplated by the preceding sentence,
however, the Company shall use commercially reasonable efforts (which
shall not require the Company to make any payment or to surrender any
right) to effect such registration without requirement of any exercise
of the Warrant, including trying to obtain the agreement of any
underwriters participating in such registration to purchase the
Warrants directly from the holders thereof for a purchase price equal
to the price per Warrant Share at which such shares shall be offered to
the public, less any underwriting commissions and less the Purchase
Price.
9.2 Registration Procedures. If and whenever the Company is
required by the provisions hereof to effect the registration of any shares of
Warrant Stock under the Securities Act, the Company will, as expeditiously as
possible:
(a) prepare and file with the Securities and Exchange
Commission (the "Commission") a registration statement with respect to
such securities and use its best efforts to cause such registration
statement to become and remain effective for the period of the
distribution contemplated thereby (determined as hereinafter provided):
(b) prepare and file with the Commission such
amendments and supplements to such registration statement and the
prospectus used in connection therewith as may be necessary to keep
such registration statement effective for the period specified in
paragraph (a) above and comply with the provisions of the Securities
Act with respect to the disposition of all of the Warrant Stock covered
by such registration statement in accordance with the Seller's intended
method of disposition set forth in such registration statement for such
period;
(c) furnish to the Seller, and to each underwriter,
if any, such number of copies of the registration statement and the
prospectus included therein (including each preliminary prospectus) as
such persons reasonably may request in order to facilitate the public
sale or their disposition of the securities covered by such
registration statement;
6
(d) use its best efforts to register or qualify the
Seller's Warrant Stock covered by such registration statement under the
securities or "blue sky" laws of such jurisdictions as the Seller or,
in the case of an underwritten public offering, the managing
underwriter reasonably shall request, provided, however, that the
Company shall not for any such purpose be required to qualify generally
to transact business as a foreign corporation in any jurisdiction where
it is not so qualified or to consent to general service of process in
any such jurisdiction;
(e) list the Warrant Stock covered by such
registration statement with any securities exchange market system on
which the Warrant Stock of the Company is then listed or traded;
(f) immediately notify the Seller and each
underwriter, if any, at any time when a prospectus relating to the
Warrant Stock is required to be delivered under the Securities Act, of
the happening of any event of which the Company has knowledge as a
result of which such prospectus, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing;
(g) make available for inspection by the Seller, any
underwriter participating in any distribution pursuant to such
registration statement, and any attorney, accountant or other agent
retained by the Seller or underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and cause
the Company's officers, directors and employees to supply all
information reasonably requested by the Seller, underwriter, attorney,
accountant or agent in connection with such registration statement.
For purposes of this Section 9, the period of distribution of
securities in a firm commitment underwritten public offering shall be deemed to
extend until each underwriter has completed the distribution of all securities
purchased by it, or sooner if the managing underwriter consents, and the period
of distribution of securities in any other registration shall be deemed to
extend until the earlier of the sale of all securities covered thereby and 120
days after the effective date thereof.
In connection with each registration hereunder, the Seller
will furnish to the Company, in writing such information, with respect to itself
and the proposed distribution by it as reasonably shall be necessary in order to
assure compliance with federal and applicable state securities laws. In
connection with each registration pursuant to this Section 9 covering an
underwritten public offering, the Company and the Seller agree to enter into a
written agreement with the managing underwriter in such form and containing such
provisions as are customary in the securities business for such an arrangement
between such underwriter and companies of the Company's size and investment
stature.
9.3 Expenses. All expenses incurred by the Company in
complying with this Section 9, including, without limitation, all registration
and filing fees, printing expenses, fees and disbursements of counsel and
independent public accountants for the Company, fees and expenses (including
counsel fees) incurred in connection with complying with state securities or
"blue sky" laws, fees of the National Association of Securities Dealers, Inc.,
transfer taxes, fees of transfer agents and registrars and costs of insurance
are called "Registration Expenses." All underwriting discounts and selling
commissions applicable to the sale of Warrant Stock, including any fees and
disbursements of any special counsel to the Seller, are called "Selling
Expenses."
The Company will pay all Registration Expenses in connection
with up to two registration statements filed under this Section 9. All Selling
Expenses in connection with each registration statement under this Section 9
shall be borne by the Seller in proportion to the number of shares sold by the
Seller relative to the number of shares sold under such registration statement
or as all sellers thereunder may agree.
7
9.4 Indemnification and Contribution.
(a) In the event of a registration of any Warrant
Stock under the Securities Act pursuant to this Section 9, the Company
will indemnify and hold harmless the Seller, each underwriter of such
Warrant Stock thereunder and each other person, if any, who controls
such Seller or underwriter within the meaning of the Securities Act,
against any losses, claims, damages or liabilities, joint or several,
to which the Seller, or such underwriter or controlling person may
become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any registration statement
under which such Warrant Stock was registered under the Securities Act
pursuant to this Section 9, any preliminary prospectus or final
prospectus contained therein, or any amendment or supplement thereof,
or arise out of or arc based upon the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will
reimburse the Seller, each such underwriter and each such controlling
person for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim,
damage, liability or action; provided, however, that the Company will
not be liable to the provider of information giving rise to any claim
in any such case if and to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission so made in
conformity with information furnished by any such Seller, the
underwriter or any such controlling person about itself in writing
specifically for use in such registration statement or prospectus.
(b) In the event of a registration of any of the
Warrant Stock under the Securities Act pursuant to Section 9, the
Seller will indemnify and hold harmless the Company, each person, if
any, who controls the Company within the meaning of the Securities Act,
each officer of the Company who signs the registration statement, each
director of the Company, each underwriter and each person who controls
any underwriter within the meaning of the Securities Act, against all
losses, claims, damages or liabilities, joint or several, to which the
Company or such officer, director, underwriter or controlling person
may become subject under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration
statement under which such Warrant Stock was registered under the
Securities Act pursuant to this Section 9, any preliminary prospectus
or final prospectus contained therein, or any amendment or supplement
thereof, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and will
reimburse the Company and each such officer, director, underwriter and
controlling person for any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such loss,
claim, damage, liability or actions, provided, however, that the Seller
will be liable hereunder in any such case if and only to the extent
that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission
or alleged omission made in reliance upon and in conformity with
information pertaining to such Seller, as such, furnished in writing to
the Company by such Seller specifically for use in such registration
statement or prospectus, and provided, further, however, that the
liability of the Seller hereunder shall be limited to the proportion of
any such loss, claim, damage, liability or expense which is equal to
the proportion that the public offering price of the Warrant Stock sold
by the Seller under such registration statement bears to the total
public offering price of all securities sold thereunder, but not in any
event to exceed the proceeds received by the Seller from the sale of
Warrant Stock covered by such registration statement.
(c) Promptly after receipt by an indemnified party
hereunder of notice of the commencement of any actions such indemnified
8
party shall, if a claim in respect thereof is to be made against the
indemnifying party hereunder, notify the indemnifying party in writing
thereof, but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to such indemnified
party other than under this Section 9.4(c) and shall only relieve it
from any liability which it may have to such indemnified party under
this Section 9.4(c) if and to the extent the indemnifying party is
prejudiced by such omission. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be
entitled to participate in and, to the extent it shall wish, to assume
and undertake the defense thereof with counsel reasonably satisfactory
to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume and
undertake the defense thereof, the indemnifying party shall not be
liable to such indemnified party under this Section 9.4(c) for any
legal expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation and of liaison with counsel so selected, provided,
however, that, if the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be reasonable defenses
available to it which are different from or additional to those
available to the indemnifying party or if the interests of the
indemnified party reasonably may be deemed to conflict with the
interest of the indemnifying party or if the indemnifying party shall
not have assumed or undertaken the defense of such action with counsel
reasonably satisfactory to such indemnified party, the indemnified
party shall have the right to select one separate counsel and to assume
such legal defenses and otherwise to participate in the defense of such
action, with the expenses and fees of such separate counsel and other
expenses related to such participation to be reimbursed by the
indemnifying party as incurred.
(d) In order to provide for just and equitable
contribution to joint liability under the Securities Act in any case in
which either (i) the Seller, or any controlling person of the Seller,
makes a claim for indemnification pursuant to this Section 9.4 but it
is judicially determined (by the entry of a final judgment or decree by
a court of competent jurisdiction and the expiration of time to appeal
or the denial of the last right of appeal) that such indemnification
may not be enforced in such case notwithstanding the fact that this
Section 9.4 provides for indemnification in such case, or (ii)
contribution under the Securities Act may be required on the part of
the Seller or controlling person of the Seller in circumstances for
which indemnification is provided under this Section 9.4; then, and in
each such case, the Company and the Seller will contribute to the
aggregate losses, claims, damages or liabilities to which they may be
subject (after contribution from others) in such proportion so that the
Seller is responsible for the portion represented by the percentage
that the public offering price of its securities offered by the
registration statement bears to the public offering price of all
securities offered by such registration statement, and the Company is
responsible for the remaining portion; provided, however, that, in any
such case, (A) the Seller will not be required to contribute any amount
in excess of the net proceeds received by such Seller from the sale of
all such securities offered by it pursuant to such registration
statement; and (B) no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 10(f) of the
Securities Act) will be entitled to contribution from any person or
entity who was not guilty of such fraudulent misrepresentation.
10. Replacement of Warrant. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of this Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.
9
11. Warrant Agent. The Company may, by written notice to the each
holder of the Warrant, appoint an agent having an office in New York, NY for the
purpose of issuing Warrant Stock (or Other Securities) on the exercise of this
Warrant pursuant to Section 1, exchanging this Warrant pursuant to Section 8,
and replacing this Warrant pursuant to Section 10, or any of the foregoing, and
thereafter any such issuance, exchange or replacement, as the case may be, shall
be made at such office by such agent.
12. Transfer on the Company's Books. Until this Warrant is transferred
on the books of the Company, the Company may treat the registered holder hereof
as the absolute owner hereof for all purposes, notwithstanding any notice to the
contrary.
13. Notices, etc. All notices and other communications from the Company
to the Holder shall be mailed by first class registered or certified mail,
postage prepaid, at such address as may have been furnished to the Company in
writing by the Holder or, until the Holder furnishes to the Company an address,
then to, and at the address of, the last Holder of this Warrant who has so
furnished an address to the Company. Notices shall be deemed given 48 hours
after mailing.
14. Miscellaneous. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. This Warrant shall be construed and enforced in accordance with and
governed by the laws of New York. The headings in this Warrant are for purposes
of reference only, and shall not limit or otherwise affect any of the terms
hereof. The invalidity or unenforceability of any provision hereof shall in no
way affect the validity or enforceability of any other provision.
IN WITNESS WHEREOF, the Company has executed this Warrant under seal as
of the date first written above.
BOUNDLESS CORPORATION
By:
-------------------------------
Title: Vice President
Witness:
By:
--------------------------
10
Exhibit A
FORM OF SUBSCRIPTION
(To be signed only on exercise of Warrant)
TO: BOUNDLESS CORPORATION
The undersigned, the Holder of the within Warrant, hereby irrevocably
elects to exercise this Warrant for, and to purchase thereunder, shares of
Warrant Stock of Boundless Corporation and herewith makes payment of $ therefor
by [delivery of a check in such amount] [hereby instructing Boundless
Corporation to deduct from the enclosed Warrant a number of shares of Warrant
Stock having an aggregate Fair Market Value equal to $ as of the
date hereof, which amount represents the Purchase Price for the shares for which
the within Warrant is hereby exercised, and which is equal to shares of
Warrant Stock], and requests that the certificates for such shares be issued in
the name of, and delivered to whose address is.
Dated:
-----------------------------------
(Signature must conform to name of
Holder as specified on the face of
the Warrant)
(Address)
-----------------------------------
-----------------------------------
-----------------------------------
11
Exhibit B
FORM OF TRANSFEROR ENDORSEMENT
(To be signed only on transfer of Warrant)
For value received, the undersigned hereby sells, assigns, and
transfers unto the person(s) named below under the heading "Transferees" the
right represented by the within Warrant to purchase the percentage and number of
shares of Warrant Stock of Boundless Corporation to which the within Warrant
relates specified under the headings "Percentage Transferred" and "Number
Transferred", respectively, opposite the name(s) of such person(s) and appoints
each such person Attorney to transfer its respective right on the books of
Boundless Corporation with full power of substitution in the premises.
Transferees Percentage Transferred Number Transferred
----------- ---------------------- ------------------
Dated:
------------------------------
(Signature must conform to name
of Holder as specified on the
face of the warrant)
Signed in the presence of:
---------------------------------
(Name)
(Address)
------------------------------
------------------------------
------------------------------
ACCEPTED AND AGREED:
---------------------------------
[TRANSFEREE]
(Address)
------------------------------
------------------------------
------------------------------
---------------------------------
(Name)
(Address)
---------------------------------
---------------------------------
---------------------------------
12
