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EXHIBIT 4.4
WARRANT AGREEMENT
AGREEMENT, dated as of this 24th day of January, 1997, by and
among ON' VILLAGE COMMUNICATIONS, INC. a California corporation (the
"Company"), AMERICAN STOCK TRANSFER & TRUST COMPANY, as warrant agent (the
"Warrant Agent"), and X.X. XXXXX INVESTMENT BANKING CORP., a New York
corporation ("Xxxxx").
W I T N E S S E T H
WHEREAS, in connection with (i) a private placement (the
"Private Placement") of a minimum of twenty (20) and a maximum of forty (40)
units ("Units") each Unit consisting of $50,000 principal amount of 10%
Promissory Notes ("Notes"), and 25,000 Class A common stock purchase warrants
("Warrants"), each Warrant exercisable to purchase one share of the Company's
Class A Common Stock, (ii) a private placement in October and November, 1996 of
units, consisting of an aggregate of $200,000 principal amount of notes and
200,000 warrants, which warrants will automatically convert into 200,000
Warrants upon the initial closing of the Private Placement, the Company will
issue up to 1,200,000 Warrants; and
WHEREAS, the Company desires the Warrant Agent to act on
behalf of the Company, and the Warrant Agent is willing to so act, in
connection with the issuance, registration, transfer, exchange and redemption
of the Warrants, the issuance of certificates representing the Warrants, the
exercise of the Warrants, and the rights of the holders thereof.
NOW THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth and for the purpose of defining the terms and
provisions of the Warrants and the certificates representing the Warrants and
the respective rights and obligations thereunder of the Company, the holders of
certificates representing the Warrants and the Warrant Agent, the parties
hereto agree as follows:
SECTION 1. Definitions. As used herein, the following
terms shall have the following meanings, unless the context shall otherwise
require:
(a) "Common Stock" shall mean stock of the Company of any
class, whether now or hereafter authorized, which has the right to participate
in the distributions of earnings and assets of the Company without limit as to
amount or percentage, which at the date hereof consists of 18,800,000
authorized shares of Class A Common Stock ("Class A Common Stock") and
1,400,000 authorized shares of Class B Common Stock.
(b) "Corporate Office" shall mean the office of the
Warrant Agent (or its successor) at which at any particular time its principal
business shall be administered, which office is located at the date hereof at
00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx.
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(c) "Exercise Date" shall mean, as to any Warrant, the
date on which the Warrant Agent shall have received both (a) the Warrant
Certificate representing such Warrant, with the exercise form thereon duly
executed by the Registered Holder thereof or his attorney duly authorized in
writing, and (b) payment in cash, or by official bank or certified check made
payable to the Company, of an amount in lawful money of the United States of
America equal to the applicable Purchase Price.
(d) "Initial Warrant Exercise Date" shall mean January
24, 1998.
(e) "Purchase Price" shall mean the purchase price to be
paid upon exercise of each Warrant in accordance with the terms hereof, which
price shall be $3.00 per share subject to (i) adjustment from time to time
pursuant to the provisions of Section 8 hereof or (ii) conversion of the
Warrants pursuant to the provisions of Section 9 hereof, and subject to the
Company's right to reduce the Purchase Price upon notice to all warrantholders.
(f) "Registered Holder" shall mean the person in whose
name any certificate representing Warrants shall be registered on the books
maintained by the Warrant Agent pursuant to Section 6.
(g) "Transfer Agent" shall mean American Stock Transfer &
Trust Company, as the Company's transfer agent, or its authorized successor, as
such.
(h) "Warrant Expiration Date" shall mean 5:00 P.M. (New
York time) on January 24, 1999; provided that if such date shall in the State
of New York be a holiday or a day on which banks are authorized to close, then
5:00 P.M. (New York time) on the next following day which in the State of New
York is not a holiday or a day on which banks are authorized to close. Upon
notice to all warrantholders the Company shall have the right to extend the
Warrant Expiration Date.
SECTION 2. Warrants and Issuance of Warrant
Certificates.
(a) A Warrant shall initially entitle the Registered
Holder of the Warrant Certificate representing such Warrant to purchase one
share of Class A Common Stock upon the exercise thereof, in accordance with the
terms hereof, subject to modification and adjustment as provided in Section 8.
(b) From time to time, up to the Warrant Expiration Date,
the Transfer Agent shall execute and deliver stock certificates in required
whole number denominations representing up to an aggregate of 1,200,000 shares
of Class A Common Stock, subject to adjustment as described herein, upon the
exercise of Warrants in accordance with this Agreement.
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(c) From time to time, up to the Warrant Expiration Date,
the Warrant Agent shall execute and deliver Warrant Certificates in required
whole number denominations to the persons entitled thereto in connection with
any transfer or exchange permitted under this Agreement; provided that no
Warrant Certificates shall be issued except (i) those initially issued
hereunder, (ii) those issued on or after the Initial Warrant Exercise Date,
upon the exercise of fewer than all Warrants represented by any Warrant
Certificate, to evidence any unexercised Warrants held by the exercising
Registered Holder, (iii) those issued upon any transfer or exchange pursuant to
Section 6; (iv) those issued in replacement of lost, stolen, destroyed or
mutilated Warrant Certificates pursuant to Section 7; and (v) at the option of
the Company, in such form as may be approved by the its Board of Directors, to
reflect (a) any adjustment or change in the Purchase Price or the number of
shares of Class A Common Stock purchasable upon exercise of the Warrants, made
pursuant to Section 8 hereof and (b) other modifications approved by
Warrantholders in accordance with Section 16 hereof.
(d) In the event of an initial public offering of the
Company's securities, the provisions of Section 9 hereof will govern in certain
circumstances described therein.
SECTION 3. Form and Execution of Warrant Certificates.
(a) The Warrant Certificates shall be substantially in the form annexed
hereto as Exhibit A (the provisions of which are hereby incorporated herein)
and may have such letters, numbers or other marks of identification or
designation and such legends, summaries or endorsements printed, lithographed,
engraved or typed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any law or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange on which the Warrants may be
listed, or to conform to usage. The Warrant Certificates shall be dated the
date of issuance thereof (whether upon initial issuance, transfer, exchange or
in lieu of mutilated, lost, stolen, or destroyed Warrant Certificates) and
issued in registered form. Warrants shall be numbered serially with the letter
W.
(b) Warrant Certificates shall be executed on behalf of
the Company by its Chairman of the Board, Chief Executive Officer, President or
any Vice President and by its Secretary or an Assistant Secretary, by manual
signatures or by facsimile signatures printed thereon, and shall have imprinted
thereon a facsimile of the Company's seal. In case any officer of the Company
who shall have signed any of the Warrant Certificates shall cease to be such
officer of the Company before the date of issuance of the Warrant Certificates
and issue and delivery thereof, such Warrant Certificates may nevertheless be
issued and delivered with the same force and effect as though the person who
signed such Warrant Certificates had not ceased to be such officer of the
Company. After execution by the Company, Warrant Certificates shall be
delivered by the Warrant Agent to the Registered Holder.
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SECTION 4. Exercise.
(a) Each Warrant may be exercised by the Registered
Holder thereof at any time on or after the Initial Exercise Date, but not after
the Warrant Expiration Date, upon the terms and subject to the conditions set
forth herein and in the applicable Warrant Certificate. A Warrant shall be
deemed to have been exercised immediately prior to the close of business on the
Exercise Date and the person entitled to receive the securities deliverable
upon such exercise shall be treated for all purposes as the holder upon
exercise thereof as of the close of business on the Exercise Date. As soon as
practicable on or after the Exercise Date the Warrant Agent shall deposit the
proceeds received from the exercise of a Warrant, and promptly after clearance
of checks received in payment of the Purchase Price pursuant to such Warrants,
cause to be issued and delivered by the Transfer Agent, to the person or
persons entitled to receive the same, a certificate or certificates for the
securities deliverable upon such exercise (plus a certificate for any remaining
unexercised Warrants of the Registered Holder). Notwithstanding the foregoing,
in the case of payment made in the form of a check drawn on an account of Xxxxx
or such other investment banks and brokerage houses as the Company shall
approve, certificates shall immediately be issued without any delay. Upon the
exercise of any Warrant and clearance of the funds received, the Warrant Agent
shall promptly remit the payment received for the Warrant to the Company or as
the Company may direct in writing.
(b) If on the Exercise Date in respect of the exercise of
any Warrant, (i) the market price of the Company's Class A Common Stock is
greater than the then Purchase Price of the Warrant, (ii) the exercise of the
Warrant was solicited by a member of the National Association of Securities
Dealers, Inc. ("NASD"), (iii) the Warrant was not held in a discretionary
account, (iv) disclosure of compensation arrangements was made both at the time
of the original offering and at the time of exercise; and (v) the solicitation
of the exercise of the Warrant was not in violation of Regulation M (as such
rule or any successor rule may be in effect as of such time of exercise)
promulgated under the Securities Exchange Act of 1934, then the Warrant Agent,
simultaneously with the receipt of the proceeds upon exercise of the Warrant(s)
so exercised shall pay from the proceeds received upon exercise of the
Warrant(s), a fee of 5% of the Purchase Price to Xxxxx (of which up to 1% may
be reallowed to the dealer who solicited the exercise). Within five days after
exercise the Warrant Agent shall send Xxxxx a copy of the reverse side of each
Warrant exercised. Xxxxx shall reimburse the Warrant Agent, upon request, for
its reasonable expenses relating to compliance with this Section 4(b). In
addition, Xxxxx may at any time during business hours, examine the records of
the Warrant Agent, including its ledger of original Warrant Certificates
returned to the Warrant Agent upon exercise of Warrants. The provisions of
this paragraph may not be modified, amended or deleted without the prior
written consent of Xxxxx. Market price shall be determined in accordance with
the provisions of Section 10.
SECTION 5. Reservation of Shares; Listing; Payment of
Taxes; etc. (a) The Company covenants that it will at all times
reserve and keep available out of its authorized Class A Common Stock, solely
for the purpose of issue upon exercise of Warrants, such number
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of shares of Class A Common Stock as shall then be issuable upon the exercise
of all outstanding Warrants. The Company covenants that all shares of Class A
Common Stock which shall be issuable upon exercise of the Warrants and payment
of the Purchase Price shall, at the time of delivery, be duly and validly
issued, fully paid, nonassessable and free from all taxes, liens and charges
with respect to the issue thereof (other than those which the Company shall
promptly pay or discharge).
(b) The Company will use reasonable efforts to obtain
appropriate approvals or registrations under state "blue sky" securities laws
with respect to the exercise of the Warrants; provided, however, that the
Company shall not be obligated to file any general consent to service of
process or qualify as a foreign corporation in any jurisdiction. With respect
to any such securities laws, however, Warrants may not be exercised by, or
shares of Class A Common Stock issued to, any Registered Holder in any state in
which such exercise would be unlawful.
(c) The Company shall pay all documentary, stamp or
similar taxes and other governmental charges that may be imposed with respect
to the issuance of Warrants, or the issuance, or delivery of any shares upon
exercise of the Warrants; provided, however, that if the shares of Class A
Common Stock are to be delivered in a name other than the name of the
Registered Holder of the Warrant Certificate representing any Warrant being
exercised, then no such delivery shall be made unless the person requesting the
same has paid to the Warrant Agent the amount of transfer taxes or charges
incident thereto, if any.
(d) The Warrant Agent is hereby irrevocably authorized to
requisition the Company's Transfer Agent from time to time for certificates
representing shares of Class A Common Stock required upon exercise of the
Warrants, and the Company will authorize the Transfer Agent to comply with all
such proper requisitions.
SECTION 6. Exchange and Registration of Transfer.
Subject to the restrictions on transfer contained in the
Warrant Certificates and the Subscription Agreements between the Company and
the purchasers of Units:
(a) Warrant Certificates may be exchanged for other
Warrant Certificates representing an equal aggregate number of Warrants of the
same class or may be transferred in whole or in part; Warrant Certificates to
be exchanged shall be surrendered to the Warrant Agent at its Corporate Office,
and upon satisfaction of the terms and provisions hereof, the Company shall
execute, and the Warrant Agent shall countersign, issue and deliver in exchange
therefor the Warrant Certificate or Certificates which the Registered Holder
making the exchange shall be entitled to receive.
(b) The Warrant Agent shall keep at its office books in
which, subject to such reasonable regulations as it may prescribe, it shall
register Warrant Certificates and the transfer thereof in accordance with its
regular practice. Upon due presentment for registration of transfer
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of any Warrant Certificate at its office, the Company shall execute and the
Warrant Agent shall issue and deliver to the transferee or transferees a new
Warrant Certificate or Certificates representing an equal aggregate number of
Warrants.
(c) With respect to all Warrant Certificates presented
for registration of transfer, or for exchange or exercise, the subscription
form on the reverse thereof shall be duly endorsed, or be accompanied by a
written instrument or instruments of transfer and subscription, in form
satisfactory to the Company, duly executed by the Registered Holder or his
attorney-in-fact duly authorized in writing.
(d) The Company may require payment by such holder of a
sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith.
(e) All Warrant Certificates surrendered for exercise or
for exchange in case of mutilated Warrant Certificates shall be promptly
cancelled by the Warrant Agent and thereafter retained by the Warrant Agent
until termination of this Agreement or resignation of the Warrant Agent, or,
with the prior written consent of Xxxxx, disposed of or destroyed, at the
direction of the Company.
(f) Prior to due presentment for registration of transfer
thereof, the Company and the Warrant Agent may deem and treat the Registered
Holder of any Warrant Certificate as the absolute owner thereof and of each
Warrant represented thereby (notwithstanding any notations of ownership or
writing thereon made by anyone other than a duly authorized officer of the
Company or the Warrant Agent) for all purposes and shall not be affected by any
notice to the contrary.
SECTION 7. Loss or Mutilation. Upon receipt by the
Company and the Warrant Agent of evidence satisfactory to them of the ownership
of and loss, theft, destruction or mutilation of any Warrant Certificate and
(in case of loss, theft or destruction) of indemnity satisfactory to them, and
(in the case of mutilation) upon surrender and cancellation thereof, the
Company shall execute and the Warrant Agent shall (in the absence of notice to
the Company and/or Warrant Agent that the Warrant Certificate has been acquired
by a bonafide purchaser) countersign and deliver to the Registered Holder in
lieu thereof a new Warrant Certificate of like tenor representing an equal
aggregate number of Warrants. Applicants for a substitute Warrant Certificate
shall comply with such other reasonable regulations and pay such other
reasonable charges as the Warrant Agent may prescribe.
SECTION 8. Adjustment of Exercise Price and Number of
Shares of Class A Common Stock or Warrants.
(a) Subject to the exceptions referred to in Section 8(g)
below, in the event the Company shall, at any time or from time to time after
the date hereof, sell any shares of Common Stock for a consideration per share
less than the current fair market value per share of the
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Class A Common Stock on the date of the sale (determined as provided in Section
10 hereof) or issue any shares of Common Stock as a stock dividend to the
holders of Common Stock, or subdivide or combine the outstanding shares of
Common Stock into a greater or lesser number of shares (any such sale,
issuance, subdivision or combination being herein called a "Change of Shares"),
then, and thereafter upon each further Change of Shares, the Purchase Price in
effect immediately prior to such Change of Shares shall be changed to a price
(including any applicable fraction of a cent) determined by multiplying the
Purchase Price in effect immediately prior thereto by a fraction, the numerator
of which shall be the sum of the number of shares of Common Stock outstanding
immediately prior to the issuance of such additional shares and the number of
shares of Common Stock which the aggregate consideration received (determined
as provided in subsection 8(f)(F) below), if any, for the issuance of such
additional shares would purchase at such current market price per share of
Class A Common Stock, and the denominator of which shall be the sum of the
number of shares of Common Stock outstanding immediately after the issuance of
such additional shares. Such adjustment shall be made successively whenever
such an issuance is made.
Upon each adjustment of the Purchase Price pursuant
to this Section 8, the total number of shares of Class A Common Stock
purchasable upon the exercise of each Warrant shall (subject to the provisions
contained in Section 8(b) hereof) be such number of shares (calculated to the
nearest tenth) purchasable at the Purchase Price immediately prior to such
adjustment multiplied by a fraction, the numerator of which shall be the
Purchase Price in effect immediately prior to such adjustment and the
denominator of which shall be the Purchase Price in effect immediately after
such adjustment.
(b) The Company may elect, upon any adjustment of the
Purchase Price hereunder, to adjust the number of Warrants outstanding, in lieu
of the adjustment in the number of shares of Class A Common Stock purchasable
upon the exercise of each Warrant as hereinabove provided, so that each Warrant
outstanding after such adjustment shall represent the right to purchase one
share of Class A Common Stock. Each Warrant held of record prior to such
adjustment of the number of Warrants shall become that number of Warrants
(calculated to the nearest tenth) determined by multiplying the number one by a
fraction, the numerator of which shall be the Purchase Price in effect
immediately prior to such adjustment and the denominator of which shall be the
Purchase Price in effect immediately after such adjustment. Upon each
adjustment of the number of Warrants pursuant to this Section 8, the Company
shall, as promptly as practicable, cause to be distributed to each Registered
Holder of Warrant Certificates on the date of such adjustment Warrant
Certificates evidencing, subject to Section 10 hereof, the number of additional
Warrants to which such Holder shall be entitled as a result of such adjustment
or, at the option of the Company, cause to be distributed to such Holder in
substitution and replacement for the Warrant Certificates held by him prior to
the date of adjustment (and upon surrender thereof, if required by the Company)
new Warrant Certificates evidencing the number of Warrants to which such Holder
shall be entitled after such adjustment.
(c) In case of any reclassification, capital
reorganization or other change of outstanding shares of Common Stock, or in
case of any consolidation or merger of the Company
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with or into another corporation (other than a consolidation or merger in which
the Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock), or in case of any sale or conveyance to another corporation
of the property of the Company as, or substantially as, an entirety (other than
a sale/leaseback, mortgage or other financing transaction), the Company shall
cause effective provision to be made so that each holder of a Warrant then
outstanding shall
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have the right thereafter, by exercising such Warrant, to purchase the kind and
number of shares of stock or other securities or property (including cash)
receivable upon such reclassification, capital reorganization or other change,
consolidation, merger, sale or conveyance by a holder of the number of shares
of Class A Common Stock that might have been purchased upon exercise of such
Warrant immediately prior to such reclassification, capital reorganization or
other change, consolidation, merger, sale or conveyance. Any such provision
shall include provision for adjustments that shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Section 8. The
foregoing provisions shall similarly apply to successive reclassifications,
capital reorganizations and other changes of outstanding shares of Common Stock
and to successive consolidations, mergers, sales or conveyances.
(d) Irrespective of any adjustments or changes in the
Purchase Price or the number of shares of Class A Common Stock purchasable upon
exercise of the Warrants, the Warrant Certificates theretofore and thereafter
issued shall, unless the Company shall exercise its option to issue new Warrant
Certificates pursuant to Section 2(c) hereof, continue to express the Purchase
Price per share and the number of shares purchasable thereunder as the Purchase
Price per share, and the number of shares purchasable were expressed in the
Warrant Certificates when the same were originally issued.
(e) After each adjustment of the Purchase Price pursuant
to this Section 8, the Company will promptly prepare a certificate signed by
the Chairman, Chief Executive Officer or President, and by the Treasurer or an
Assistant Treasurer or the Secretary or an Assistant Secretary, of the Company
setting forth: (i) the Purchase Price as so adjusted, (ii) the number of
shares of Class A Common Stock purchasable upon exercise of each Warrant after
such adjustment, and, if the Company shall have elected to adjust the number of
Warrants, the number of Warrants to which the registered holder of each Warrant
shall then be entitled, and (iii) a brief statement of the facts accounting for
such adjustment. The Company will promptly file such certificate with the
Warrant Agent and cause a brief summary thereof to be sent by ordinary first
class mail to Xxxxx and to each registered holder of Warrants at his last
address as it shall appear on the registry books of the Warrant Agent. No
failure to mail such notice nor any defect therein or in the mailing thereof
shall affect the validity thereof except as to the holder to whom the Company
failed to mail such notice, or except as to the holder whose notice was
defective. The affidavit of an officer of the Warrant Agent or the Secretary
or an Assistant Secretary of the Company that such notice has been mailed
shall, in the absence of fraud, be prima facie evidence of the facts stated
therein.
(f) For purposes of Section 8(a) and 8(b) hereof, the
following provisions (A) to (F) shall also be applicable:
(A) The number of shares of Common Stock
outstanding at any given time shall include shares of Common
Stock owned or held by or for the account of the Company and
the sale or issuance of such treasury shares or the
distribution of any such treasury shares shall not be
considered a Change of Shares for purposes of said sections.
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(B) No adjustment of the Purchase Price shall be
made unless such adjustment would require an increase or
decrease of at least $.10 in such price; provided that any
adjustments which by reason of this clause (B) are not
required to be made shall be carried forward and shall be made
at the time of and together with the next subsequent
adjustment which, together with any adjustment(s) so carried
forward, shall require an increase or decrease of at least
$.10 in the Purchase Price then in effect hereunder.
(C) In case of (1) the sale by the Company for
cash of any rights or warrants to subscribe for or purchase,
or any options for the purchase of, Common Stock or any
securities convertible into or exchangeable for Common Stock
without the payment of any further consideration other than
cash, if any (such convertible or exchangeable securities
being herein called "Convertible Securities"), or (2) the
issuance by the Company, without the receipt by the Company of
any consideration therefor, of any rights or warrants to
subscribe for or purchase, or any options for the purchase of,
Common Stock or Convertible Securities, in each case, if (and
only if) the consideration payable to the Company upon the
exercise of such rights, warrants or options shall consist of
cash, whether or not such rights, warrants or options, or the
right to convert or exchange such Convertible Securities, are
immediately exercisable, and the price per share for which
Common Stock is issuable upon the exercise of such rights,
warrants or options or upon the conversion or exchange of such
Convertible Securities (determined by dividing (x) the minimum
aggregate consideration payable to the Company upon the
exercise of such rights, warrants or options, plus the
consideration received by the Company for the issuance or sale
of such rights, warrants or options, plus, in the case of such
Convertible Securities, the minimum aggregate amount of
additional consideration, if any, other than such Convertible
Securities, payable upon the conversion or exchange thereof,
by (y) the total maximum number of shares of Common Stock
issuable upon the exercise of such rights, warrants or options
or upon the conversion or exchange of such Convertible
Securities issuable upon the exercise of such rights, warrants
or options) is less than the current market value of the Class
A Common Stock on the date of the issuance or sale of such
rights, warrants or options, then the total maximum number of
shares of Common Stock issuable upon the exercise of such
rights, warrants or options or upon the conversion or exchange
of such Convertible Securities (as of the date of the issuance
or sale of such rights, warrants or options) shall be deemed
to be outstanding shares of Common Stock for purposes of
Sections 8(a) and 8(b) hereof and shall be deemed to have been
sold for cash in an amount equal to such price per share.
(D) In case of the sale by the Company for cash
of any Convertible Securities, whether or not the right of
conversion or exchange thereunder is immediately exercisable,
and the price per share for which Common Stock is issuable
upon the conversion or exchange of such Convertible Securities
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(determined by dividing (x) the total amount of consideration
received by the Company for the sale of such Convertible
Securities, plus the minimum aggregate amount of additional
consideration, if any, other than such Convertible Securities,
payable upon the conversion or exchange thereof, by (y) the
total maximum number of shares of Common Stock issuable upon
the conversion or exchange of such convertible Securities) is
less than the current market value of the Class A Common Stock
on the date of the sale of such Convertible Securities, then
the total maximum number of shares of Common Stock issuable
upon the conversion or exchange of such Convertible Securities
(as of the date of the sale of such Convertible Securities)
shall be deemed to be outstanding shares of Common Stock for
purposes of Sections 8(a) and 8(b) hereof and shall be deemed
to have been sold for cash in an amount equal to such price
per share.
(E) If the exercise or purchase price provided
for in any right, warrant or option referred to in (C) above,
or the rate at which any Convertible Securities referred to in
(C) or (D) above are convertible into or exchangeable for
Common Stock, shall change at any time (other than under or by
reason of provisions designed to protect against dilution),
the Purchase Price then in effect hereunder shall forthwith be
readjusted to such Purchase Price as would have obtained (1)
had the adjustments made upon the issuance or sale of such
rights, warrants, options or Convertible Securities been made
upon the basis of the issuance of only the number of shares of
Common Stock theretofore actually delivered (and the total
consideration received therefor) upon the exercise of such
rights, warrants or options or upon the conversion or exchange
of such Convertible Securities, (2) had adjustments been made
on the basis of the Purchase Price as adjusted under clause
(1) for all transactions (which would have affected such
adjusted Purchase Price) made after the issuance or sale of
such rights, warrants, options or Convertible Securities, and
(3) had any such rights, warrants, options or Convertible
Securities then still outstanding been originally issued or
sold at the time of such change. On the expiration of any
such right, warrant or option or the termination of any such
right to convert or exchange any such Convertible Securities,
the Purchase Price then in effect hereunder shall forthwith be
readjusted to such Purchase Price as would have obtained (a)
had the adjustments made upon the issuance or sale of such
rights, warrants, options or Convertible Securities been made
upon the basis of the issuance of only the number of shares of
Common Stock theretofore actually delivered (and the total
consideration received therefor) upon the exercise of such
rights, warrants or options or upon the conversion or exchange
of such Convertible Securities and (b) had adjustments been
made on the basis of the Purchase Price as adjusted under
clause (a) for all transactions (which would have affected
such adjusted Purchase Price) made after the issuance or sale
of such rights, warrants, options or Convertible Securities.
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(F) In case of the sale for cash of any shares of
Common Stock, any Convertible Securities, any rights or
warrants to subscribe for or purchase, or any options for the
purchase of, Common Stock or Convertible Securities, the
consideration received by the Company therefore shall be
deemed to be the gross sales price therefor without deducting
therefrom any expense paid or incurred by the Company or any
underwriting discounts or commissions or concessions paid or
allowed by the Company in connection therewith.
(g) No adjustment to the Purchase Price of the Warrants
or to the number of shares of Common Stock purchasable upon the exercise of
each Warrant will be made, however,
(i) upon the exercise of any of the options
presently outstanding under the Company's Stock Option Plan
(the "Plan") for officers, directors and certain other key
personnel of the Company; or
(ii) upon the grant or exercise of any other
options which may hereafter be granted or exercised under the
Plan or under any other employee benefit plan of the Company;
or
(iii) upon the sale or exercise of the Warrants or
any other Warrants issued by the Company; or
(iv) upon the issuance of any shares of Common
Stock or warrants sold to the public or the underwriter in the
Company's initial public offering, or upon exercise of
warrants comprising or underlying any Units sold in the
Company's initial public offering, including any shares or
warrants underlying the underwriter's warrants or unit
purchase option; or
(v) upon the issuance or sale of Common Stock or
Convertible Securities upon the exercise of any rights or
warrants to subscribe for or purchase, or any options for the
purchase of, Common Stock or Convertible Securities, whether
or not such rights, warrants or options were outstanding on
the date of the original sale of the Warrants or were
thereafter issued or sold; or
(vi) upon the issuance or sale of Common Stock
upon conversion or exchange of any Convertible Securities,
whether or not any adjustment in the Purchase Price was made
or required to be made upon the issuance or sale of such
Convertible Securities and whether or not such Convertible
Securities were outstanding on the date of the original sale
of the Warrants or were thereafter issued or sold; or
(vii) upon any amendment to or change in the terms
of any rights or warrants to subscribe for or purchase, or
options for the purchase of, Common
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13
Stock or Convertible Securities or in the terms of any
Convertible Securities, including, but not limited to, any
extension of any expiration date of any such right, warrant or
option, any change in any exercise or purchase price provided
for in any such right, warrant or option, any extension of any
date through which any Convertible Securities are convertible
into or exchangeable for Common Stock or any change in the
rate at which any Convertible Securities are convertible into
or exchangeable for Common Stock (other than rights, warrants,
options or Convertible Securities issued or sold after the
close of business on the date of the original issuance of the
Warrants (i) for which an adjustment in the Purchase Price
then in effect was theretofore made or required to be made,
upon the issuance or sale thereof, or (ii) for which such an
adjustment would have been required had the exercise or
purchase price of such rights, warrants or options at the time
of the issuance or sale thereof or the rate of conversion or
exchange of such Convertible Securities, at the time of the
sale of such Convertible Securities, or the issuance or sale
of rights or warrants to subscribe for or purchase, or options
for the purchase of, such Convertible Securities, been the
price or rate as changed, in which case the provisions of
Section 8(f)(E) hereof shall be applicable if, but only if,
the exercise or purchase price thereof, as changed, or the
rate of conversion or exchange thereof, as changed, consists
of cash or requires the payment of additional consideration,
if any, consisting of cash and the Company did not receive any
consideration other than cash, if any, in connection with such
change).
(h) As used in this Section 8, the term "Common Stock"
shall mean and include the Company's Common Stock authorized on the date of the
original issue of the Units and shall also include any capital stock of any
class of the Company thereafter authorized which shall not be limited to a
fixed sum or percentage in respect of the rights of the holders thereof to
participate in dividends and in the distribution of assets upon the voluntary
liquidation, dissolution or winding up of the Company; provided, however, that
the shares issuable upon exercise of the Warrants shall include only shares of
such class designated in the Company's Restated Articles of Incorporation as
Common Stock on the date of the original issue of the Units or (i), in the case
of any reclassification, change, consolidation, merger, sale or conveyance of
the character referred to in Section 8(c) hereof, the stock, securities or
property provided for in such section or (ii), in the case of any
reclassification or change in the outstanding shares of Common Stock issuable
upon exercise of the Warrants as a result of a subdivision or combination or
consisting of a change in par value, or from par value to no par value, or from
no par value to par value, such shares of Common Stock as so reclassified or
changed.
(i) Any determination as to whether an adjustment in the
Purchase Price in effect hereunder is required pursuant to Section 8, or as to
the amount of any such adjustment, if required, shall be binding upon the
holders of the Warrants and the Company if made in good faith by the Board of
Directors of the Company.
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14
(j) If and whenever the Company shall declare any
dividends or distributions or grant to the holders of Common Stock, as such,
rights or warrants to subscribe for or to purchase, or any options for the
purchase of, Common Stock or securities convertible into or exchangeable for or
carrying a right, warrant or option to purchase Common Stock, the Company shall
notify each of the then Registered Holders of the Warrants of such event prior
to its occurrence to enable such Registered Holders to exercise their Warrants
and participate as holders of Common Stock in such event.
SECTION 9. Conversion of Warrants and Registration Under
The Securities Act of 1933.
(a) In the event the Company consummates an initial
public offering of its securities ("IPO") through the Placement Agent, and the
securities offered in the IPO include warrants which are exercisable to
purchase common stock ("Class A Warrants"), the Warrants will be automatically
converted on the closing date of the IPO with no action needed on the part of
the holder into Class A Warrants with the identical terms as the Class A
Warrants offered to the public, which may be redeemed by the Company under
certain conditions. On such closing date, this Warrant Agreement shall
terminate and the Class A Warrants into which the Warrants convert will be
governed by the warrant agreement covering the Class A Warrants sold in the
IPO.
(b) The Company agrees to register for resale (i) the
Class A Warrants into which the Warrants are exchangeable, (ii) the warrants
issuable upon exercise thereof, if any, (the "Class B Warrants") and the shares
of Class A Common Stock issued or issuable upon exercise of the Class A and
Class B Warrants under the Securities Act of 1933, as amended (the "Act")
contemporaneously with its initial public offering as more fully set forth in
Section IV of the Subscription Agreement between the Company and each of the
investors in the Private Placement, subject to certain contractual restrictions
applicable to the Holder.
SECTION 10. Fractional Warrants and Fractional Shares.
(a) If the number of shares of Class A Common Stock
purchasable upon the exercise of each Warrant is adjusted pursuant to Section 8
hereof, the Company shall nevertheless not be required to issue fractions of
shares, upon exercise of the Warrants or otherwise, or to distribute
certificates that evidence fractional shares. With respect to any fraction of
a share called for upon any exercise hereof, the Company shall pay to the
Holder an amount in cash equal to such fraction multiplied by the current
market value of such fractional share, determined as follows:
(1) If the Class A Common Stock is listed on a
national securities exchange or admitted to unlisted trading
privileges on such exchange or listed for trading on the
Nasdaq National Market System ("NMS"), the current market
value shall be the last reported sale price of the Class A
Common Stock on such
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15
exchange on the last business day prior to the date of
exercise of this Warrant or if no such sale is made on such
day or no closing sale price is quoted, the average of the
closing bid and asked prices for such day on such exchange or
system; or
(2) If the Class A Common Stock is listed in the
over-the-counter market (other than on NMS) or admitted to
unlisted trading privileges, the current market value shall be
the mean of the last reported bid and asked prices reported by
the National Quotation Bureau, Inc. on the last business day
prior to the date of the exercise of this Warrant; or
(3) If the Class A Common Stock is not so listed
or admitted to unlisted trading privileges and bid and asked
prices are not so reported, the current market value shall be
an amount determined in such reasonable manner as may be
prescribed by the Board of Directors of the Company.
SECTION 11. Warrant Holders Not Deemed Shareholders. No
holder of Warrants shall, as such, be entitled to vote or to receive dividends
or be deemed the holder of Common Stock that may at any time be issuable upon
exercise of such Warrants for any purpose whatsoever, nor shall anything
contained herein be construed to confer upon the holder of Warrants, as such,
any of the rights of a shareholder of the Company or any right to vote for the
election of directors or upon any matter submitted to shareholders at any
meeting thereof, or to give or withhold consent to any corporate action
(whether upon any recapitalization, issue or reclassification of stock, change
of par value or change of stock to no par value, consolidation, merger or
conveyance or otherwise), or to receive notice of meetings, or to receive
dividends or subscription rights, until such Holder shall have exercised such
Warrants and been issued shares of Class A Common Stock in accordance with the
provisions hereof.
SECTION 12. Rights of Action. All rights of action with
respect to this Agreement are vested in the respective Registered Holders of
the Warrants, and any Registered Holder of a Warrant, without consent of the
Warrant Agent or of the holder of any other Warrant, may, on his own behalf and
for his own benefit, enforce against the Company his right to exercise his
Warrants for the purchase of shares of Class A Common Stock in the manner
provided in the Warrant Certificate and this Agreement.
SECTION 13. Agreement of Warrant Holders. Every holder
of a Warrant, by his acceptance thereof, consents and agrees with the Company,
the Warrant Agent and every other holder of a Warrant that:
(a) The Warrants are transferable only on the registry
books of the Warrant Agent by the Registered Holder thereof in person or by his
attorney duly authorized in writing and only if the Warrant Certificates
representing such Warrants are surrendered at the office of the Warrant Agent,
duly endorsed or accompanied by a proper instrument of transfer satisfactory
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16
to the Warrant Agent and the Company in their sole discretion, together with
payment of any applicable transfer taxes; and
(b) The Company may deem and treat the person in whose
name the Warrant Certificate is registered as the holder and as the absolute,
true and lawful owner of the Warrants represented thereby for all purposes, and
the Company shall not be affected by any notice or knowledge to the contrary,
except as otherwise expressly provided in Section 7 hereof.
SECTION 14. Cancellation of Warrant Certificates. If the
Company shall purchase or acquire any Warrant or Warrants, the Warrant
Certificate or Warrant Certificates evidencing the same shall thereupon be
cancelled by it and retired. The Warrant Agent shall also cancel Common Stock
following exercise of any or all of the Warrants represented thereby or
delivered to it for transfer, splitup, combination or exchange.
SECTION 15. Concerning the Warrant Agent. The Warrant
Agent acts hereunder as agent and in a ministerial capacity for the Company,
and its duties shall be determined solely by the provisions hereof. The
Warrant Agent shall not, by issuing and delivering Warrant Certificates or by
any other act hereunder be deemed to make any representations as to the
validity, value or authorization of the Warrant Certificates or the Warrants
represented thereby or of any securities or other property delivered upon
exercise of any Warrant or whether any stock issued upon exercise of any
Warrant is fully paid and nonassessable.
The Warrant Agent shall account promptly to the Company with
respect to Warrants exercised and concurrently pay the Company, as provided in
Section 4, all moneys received by the Warrant Agent upon the exercise of such
Warrants. The Warrant Agent shall, upon request of the Company from time to
time, deliver to the Company such complete reports of registered ownership of
the Warrants and such complete records of transactions with respect to the
Warrants and the shares of Common Stock as the Company may request. The
Warrant Agent shall also make available to the Company and Xxxxx for inspection
by their agents or employees, from time to time as either of them may request,
such original books of accounts and record (including original Warrant
Certificates surrendered to the Warrant Agent upon exercise of Warrants) as may
be maintained by the Warrant Agent in connection with the issuance and exercise
of Warrants hereunder, such inspections to occur at the Warrant Agent's office
as specified in Section 17, during normal business hours.
The Warrant Agent shall not at any time be under any duty or
responsibility to any holder of Warrant Certificates to make or cause to be
made any adjustment of the Purchase Price provided in this Agreement, or to
determine whether any fact exists which may require any such adjustments, or
with respect to the nature or extent of any such adjustment, when made, or with
respect to the method employed in making the same. It shall not (i) be liable
for any recital or statement of facts contained herein or for any action taken,
suffered or omitted by it in reliance on any Warrant Certificate or other
document or instrument believed by it in good faith to be genuine and to have
been signed or presented by the proper party or parties, (ii) be responsible
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17
for any failure on the part of the Company to comply with any of its covenants
and obligations contained in this Agreement or in any Warrant Certificate, or
(iii) be liable for any act or omission in connection with this Agreement
except for its own negligence or wilful misconduct.
The Warrant Agent may at any time consult with counsel
satisfactory to it (who may be counsel for the Company) and shall incur no
liability or responsibility for any action taken, suffered or omitted by it in
good faith in accordance with the opinion or advice of such counsel.
Any notice, statement, instruction, request, direction, order
or demand of the Company shall be sufficiently evidenced by an instrument
signed by the Chairman of the Board, Chief Executive Officer, President, any
Vice President, its Secretary, or Assistant Secretary (unless other evidence in
respect thereof is herein specifically prescribed). The Warrant Agent shall
not be liable for any action taken, suffered or omitted by it in accordance
with such notice, statement, instruction, request, direction, order or demand
believed by it to be genuine.
The Company agrees to pay the Warrant Agent reasonable
compensation for its services hereunder and to reimburse it for its reasonable
expenses hereunder; it further agrees to indemnify the Warrant Agent and save
it harmless against any and all losses, expenses and liabilities, including
judgments, costs and counsel fees, for anything done or omitted by the Warrant
Agent in the execution of its duties and powers hereunder except losses,
expenses and liabilities arising as a result of the Warrant Agent's negligence
or wilful misconduct.
The Warrant Agent may resign its duties and be discharged from
all further duties and liabilities hereunder (except liabilities arising as a
result of the Warrant Agent's own negligence or wilful misconduct), after
giving 30 days' prior written notice to the Company. At least 15 days prior to
the date such resignation is to become effective, the Warrant Agent shall cause
a copy of such notice of resignation to be mailed to the Registered Holder of
each Warrant Certificate at the Company's expense. Upon such resignation, or
any inability of the Warrant Agent to act as such hereunder, the Company shall
appoint a new warrant agent in writing. If the Company shall fail to make such
appointment within a period of 15 days after it has been notified in writing of
such resignation by the resigning Warrant Agent, then the Registered Holder of
any Warrant Certificate may apply to any court of competent jurisdiction for
the appointment of a new warrant agent. Any new warrant agent, whether
appointed by the Company or by such a court, shall be a bank or trust company
having a capital and surplus, as shown by its last published report to its
stockholders, of not less than $10,000,000 or a stock transfer company. After
acceptance in writing of such appointment by the new warrant agent is received
by the Company, such new warrant agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named herein
as the Warrant Agent, without any further assurance, conveyance, act or deed;
but if for any reason it shall be necessary or expedient to execute and deliver
any further assurance, conveyance, act or deed, the same shall be done at the
expense of the Company and shall be legally and validly executed and delivered
by the resigning Warrant Agent. Not later than the effective date of any such
appointment the
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18
Company shall file notice thereof with the resigning Warrant Agent and shall
forthwith cause a copy of such notice to be mailed to the Registered Holder of
each Warrant Certificate.
Any corporation into which the Warrant Agent or any new
warrant agent may be converted or merged or any corporation resulting from any
consolidation to which the Warrant Agent or any new warrant agent shall be a
party or any corporation succeeding to the trust business of the Warrant Agent
shall be a successor warrant agent under this Agreement without any further
act, provided that such corporation is eligible for appointment as successor to
the Warrant Agent under the provisions of the preceding paragraph. Any such
successor warrant agent shall promptly cause notice of its succession as
warrant agent to be mailed to the Company and to the Registered Holder of each
Warrant Certificate.
The Warrant Agent, its subsidiaries and affiliates, and any of
its or their officers or directors, may buy and hold or sell Warrants or other
securities of the Company and otherwise deal with the Company in the same
manner and to the same extent and with like effects as though it were not
Warrant Agent. Nothing herein shall preclude the Warrant Agent from acting in
any other capacity for the Company or for any other legal entity.
SECTION 16. Modification of Agreement. Subject to the
provisions of Section 4(b), the parties hereto may by supplemental agreement
make any changes or corrections in this Agreement (i) that it shall deem
appropriate to cure any ambiguity or to correct any defective or inconsistent
provision or manifest mistake or error herein contained; (ii) to reflect an
increase in the number of Warrants which are to be governed by this Agreement
resulting from an increase in the size of the Private Placement; or (iii) that
it may deem necessary or desirable and which shall not adversely affect the
interests of the holders of Warrant Certificates; provided, however, that this
Agreement shall not otherwise be modified, supplemented or altered in any
respect except with the consent in writing of the Registered Holders of Warrant
Certificates representing not less than 50% of the Warrants then outstanding;
and provided, further, that no change in the number or nature of the securities
purchasable upon the exercise of any Warrant, or the Purchase Price therefor,
or the acceleration of the Warrant Expiration Date, shall be made without the
consent in writing of the Registered Holder of the Warrant Certificate
representing such Warrant, other than such changes as are specifically
prescribed by this Agreement as originally executed.
SECTION 17. Notices. All notices, requests, consents and
other communications hereunder shall be in writing and shall be deemed to have
been made when delivered or mailed first class registered or certified mail,
postage prepaid as follows: if to the Registered Holder of a Warrant
Certificate, at the address of such holder as shown on the registry books
maintained by the Warrant Agent; if to the Company, at 000 X.Xx Xxxxxxx Xxxx.,
Xxxxx 000, Xxx Xxxxxxx, XX 00000, Attention: Xxxx Xxxxxx, Chief Executive
Officer; if to the Warrant Agent, at its Corporate Office and if to Xxxxx, at
X.X. Xxxxx Investment Banking Corp., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxx X. Xxxx, Esq.
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19
SECTION 18. Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York,
without reference to principles of conflict of laws.
SECTION 19. Binding Effect. This Agreement shall be
binding upon and inure to the benefit of the Company and the Warrant Agent (and
their respective successors and assigns) and the holders from time to time of
Warrant Certificates. Nothing in this Agreement is intended or shall be
construed to confer upon any other person any right, remedy or claim, in equity
or at law, or to impose upon any other person any duty, liability or
obligation.
SECTION 20. Termination. This Agreement shall terminate
on the earlier to occur of (i) the close of business on the Expiration Date of
all the Warrants; (ii) the closing date of an IPO which results in the
conversion of the Warrants; and (iii) the date upon which all Warrants have
been exercised.
SECTION 21. Counterparts. This Agreement may be executed
in counterparts, which taken together shall constitute a single document.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first above written.
ON'VILLAGE COMMUNICATIONS, INC.
By: ____________________________________
Xxxx Xxxxxx, Chief Executive Officer
X.X. XXXXX INVESTMENT BANKING CORP.
By: ____________________________________
Xxxxxx X. Xxxx, Vice Chairman and
General Counsel
AMERICAN STOCK TRANSFER & TRUST
COMPANY
By: ____________________________________
Authorized Officer
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20
THIS WARRANT AND ANY SHARES OF CLASS A COMMON STOCK ISSUABLE UPON ITS EXERCISE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE
TRANSFERRED UNTIL (1) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
(THE "ACT") SHALL HAVE BECOME EFFECTIVE WITH RESPECT THERETO, OR (2) RECEIPT BY
ON'VILLAGE COMMUNICATIONS, INC. (THE "COMPANY") OF AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO ON'VILLAGE COMMUNICATIONS, INC. TO THE EFFECT THAT
REGISTRATION UNDER THE ACT IS NOT REQUIRED IN CONNECTION WITH SUCH PROPOSED
TRANSFER NOR IS SUCH TRANSFER IN VIOLATION OF ANY APPLICABLE STATE SECURITIES
LAWS.
No. Warrants
VOID AFTER JANUARY __, 1999
WARRANT CERTIFICATE FOR PURCHASE
OF CLASS A COMMON STOCK
ON'VILLAGE COMMUNICATIONS, INC.
This certifies that FOR VALUE RECEIVED
________________________ or registered assigns (the "Registered Holder") is
the owner of the number of Warrants ("Warrants") specified above. Each Warrant
initially entitles the Registered Holder to purchase, subject to the terms and
conditions set forth in this Certificate and the Warrant Agreement (as
hereinafter defined), one fully paid and nonassessable share of Class A Common
Stock ("Class A Common Stock") of On'Village Communications, Inc., a California
corporation (the "Company") at any time commencing January __, 1998 and prior
to the Expiration Date (as hereinafter defined), upon the presentation and
surrender of this Warrant Certificate with the Subscription Form on the reverse
hereof duly executed, at the corporate office of American Stock Transfer &
Trust Company, as Warrant Agent, or its successor (the "Warrant Agent"),
accompanied by payment of an amount equal to $3.00 for each Warrant (the
"Purchase Price") in lawful money of the United States of America in cash or by
official bank or certified check made payable to the Company. The Company may,
at its election, reduce the Purchase Price.
This Warrant Certificate and each Warrant represented hereby
are issued pursuant to and are subject in all respects to the terms and
conditions set forth in the Warrant Agreement (the "Warrant Agreement"), dated
January __, 1997 by and among the Company, the Warrant Agent and X.X. Xxxxx
Investment Banking Corp.
21
In the event of certain contingencies provided for in the
Warrant Agreement, the Purchase Price or the number of shares of Class A Common
Stock subject to purchase upon the exercise of each Warrant represented hereby
are subject to modification or adjustment.
Each Warrant represented hereby is exercisable at the option
of the Registered Holder, but no fractional shares of Class A Common Stock will
be issued. In the case of the exercise of less than all the Warrants
represented hereby, the Company shall cancel this Warrant Certificate upon the
surrender hereof and shall execute and deliver a new Warrant Certificate or
Warrant Certificates of like tenor, which the Warrant Agent shall countersign,
for the balance of such Warrants.
The term "Expiration Date" shall mean 5:00 P.M. (New York
time) on January __, 1999. If such date shall in the State of New York be a
holiday or a day on which the banks are authorized to close, then the
Expiration Date shall mean 5:00 P.M. (New York time) the next following day
which in the State of New York is not a holiday or a day on which banks are
authorized to close. The Company may, at its election, extend the Expiration
Date.
This Warrant Certificate is exchangeable, upon the surrender
hereof by the Registered Holder at the corporate office of the Warrant Agent,
for a new Warrant Certificate or Warrant Certificates of like tenor
representing an equal aggregate number of Warrants, each of such new Warrant
Certificates to represent such number of Warrants as shall be designated by
such Registered Holder at the time of such surrender. Upon due presentment
with any tax or other governmental charge imposed in connection therewith, for
registration of transfer of this Warrant Certificate at such office, a new
Warrant Certificate or Warrant Certificates representing an equal aggregate
number of Warrants will be issued to the transferee in exchange therefor,
subject to the limitations provided in the Warrant Agreement.
Prior to the exercise of any Warrant represented hereby, the
Registered Holder shall not be entitled to any rights of a stockholder of the
Company, including, without limitation, the right to vote or to receive
dividends or other distributions, and shall not be entitled to receive any
notice of any proceedings of the Company, except as provided in the Warrant
Agreement.
Prior to due presentment for registration of transfer hereof,
the Company may deem and treat the Registered Holder as the absolute owner
hereof and of each Warrant represented hereby (notwithstanding any notations of
ownership or writing hereon made by anyone other than a duly authorized officer
of the Company) for all purposes and shall not be affected by any notice to the
contrary.
The Company has agreed to pay a fee of 5% of the Purchase
Price upon certain conditions as specified in the Warrant Agreement upon the
exercise of this Warrant.
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22
This Warrant will automatically convert into a like number of
new warrants under certain circumstances in the event the Company completes an
initial public offering of its securities having the terms and conditions
specified in the Warrant Agreement.
This Warrant Certificate shall be governed by and construed in
accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the Company has caused this Warrant
Certificate to be duly executed, manually or in facsimile by two of its
officers thereunto duly authorized and a facsimile of its corporate seal to be
imprinted hereon.
ON'VILLAGE COMMUNICATIONS, INC.
Dated: _____________, 1997
By ____________________________________
Xxxx Xxxxxx, Chief Executive Officer
By ____________________________
Xxxxx X. Xxxxxx, Secretary
[seal]
AMERICAN STOCK TRANSFER & TRUST
COMPANY
By ___________________________________
Authorized Officer
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23
SUBSCRIPTION FORM
To Be Executed by the Registered Holder
in Order to Exercise Warrants
The undersigned Registered Holder hereby irrevocably elects to
exercise ___________ Warrants represented by this Warrant Certificate, and to
purchase the securities issuable upon the exercise of such Warrants, and
requests that certificates for such securities shall be issued in the name of
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
____________________________________________
____________________________________________
____________________________________________
____________________________________________
[please print or type name and address]
and be delivered to
____________________________________________
____________________________________________
____________________________________________
____________________________________________
[please print or type name and address]
and if such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, that a new Warrant Certificate for the balance of such
Warrants be registered in the name of, and delivered to, the Registered Holder
at the address stated below.
The undersigned represents that the exercise of the within
Warrant was solicited by a member of the National Association of Securities
Dealers, Inc. If not solicited by an NASD member, please write "unsolicited"
in the space below. Unless otherwise indicated by listing the name of another
NASD member firm, it will be assumed that the exercise was solicited by X.X.
Xxxxx Investment Banking Corp.
______________________________________
(Name of NASD Member if other
than X.X. Xxxxx Investment
Banking Corp.)
-4-
24
Dated: ______________________
X____________________________
_____________________________
Address
________________________________
Taxpayer Identification Number
_____________________________
Signature Guaranteed
_____________________________
-5-
25
ASSIGNMENT
To Be Executed by the Registered Holder
in Order to Assign Warrants
FOR VALUE RECEIVED, ____________________ hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
____________________________________________
____________________________________________
____________________________________________
____________________________________________
[please print or type name and address]
_________________________ of the Warrants represented by this Warrant
Certificate, and hereby irrevocably constitutes and appoints
____________________________________ _______________________________ Attorney
to transfer this Warrant Certificate on the books of the Company, with full
power of substitution in the premises.
Dated: ____________________
X________________________
Signature Guaranteed
_________________________
THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE
GUARANTEED BY A COMMERCIAL BANK OR TRUST COMPANY OR A MEMBER FIRM OF THE
AMERICAN STOCK EXCHANGE, NEW YORK STOCK EXCHANGE, PACIFIC STOCK EXCHANGE OR
MIDWEST STOCK EXCHANGE.
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