Exhibit 4.3
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED
OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH
SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE
SECURITIES LAWS IS NOT REQUIRED.
SERIES B WARRANT TO PURCHASE
SHARES OF COMMON STOCK
OF
GLOWPOINT, INC.
Expires March 31, 2011
No.: W-B-06- __ Number of Shares: ___________
Date of Issuance: March 31, 2006
FOR VALUE RECEIVED, the undersigned, Glowpoint, Inc., a Delaware
corporation (together with its successors and assigns, the "Issuer"), hereby
certifies that _______________________________ or its registered assigns is
entitled to subscribe for and purchase, during the Term (as hereinafter
defined), up to ____________________________________ (_____________) shares
(subject to adjustment as hereinafter provided) of the duly authorized, validly
issued, fully paid and non-assessable Common Stock of the Issuer, at an exercise
price per share equal to the Warrant Price then in effect, subject, however, to
the provisions and upon the terms and conditions hereinafter set forth.
Capitalized terms used in this Warrant and not otherwise defined herein shall
have the respective meanings specified in Section 8 hereof.
1. Term. The term of this Warrant shall commence on March 31,
2006 and shall expire at 5:00 p.m., eastern time, on March 31, 2011 (such period
being the "Term").
2. Method of Exercise; Payment; Issuance of New Warrant; Transfer
and Exchange.
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(a) Time of Exercise. The purchase rights represented by this
Warrant may be exercised in whole or in part only in the event the Issuer fails
to achieve positive operating income (determined in accordance with GAAP),
excluding the restructuring costs and non-cash charges listed on Schedule A
attached hereto, for the fourth quarter of 2006, commencing on the date that the
Issuer makes available to the public its financial statements for the fourth
quarter of 2006 and ending upon expiration of the Term; provided, however, the
purchase rights represented by this Warrant may not be exercised and shall be
deemed null, void and of no further force or effect in the event that (i) the
Notes are prepaid prior to the date that the Issuer makes available to the
public its financial statements for the fourth quarter of 2006 or (ii) the
Issuer consummates a business combination, merger or other change in control
transaction prior to the date that the Issuer makes available to the public its
financial statements for the fourth quarter of 2006.
(b) Method of Exercise. The Holder hereof may exercise this
Warrant, in whole or in part, by the surrender of this Warrant (with the
exercise form attached hereto duly executed) at the principal office of the
Issuer, and by the payment to the Issuer of an amount of consideration therefor
equal to the Warrant Price in effect on the date of such exercise multiplied by
the number of shares of Warrant Stock with respect to which this Warrant is then
being exercised, payable at such Holder's election (i) by certified or official
bank check or by wire transfer to an account designated by the Issuer, (ii) by
"cashless exercise" in accordance with the provisions of Section 2(c), or (iii)
by a combination of the foregoing methods of payment selected by the Holder of
this Warrant.
(c) Cashless Exercise. Notwithstanding any provisions herein to
the contrary if the Per Share Market Value of one share of Common Stock is
greater than the Warrant Price (at the date of calculation as set forth below),
in lieu of exercising this Warrant by payment of cash, the Holder may exercise
this Warrant by a cashless exercise and shall receive the number of shares of
Common Stock equal to an amount (as determined below) by surrender of this
Warrant at the principal office of the Issuer together with the properly
endorsed Notice of Exercise in which event the Issuer shall issue to the Holder
a number of shares of Common Stock computed using the following formula:
X = Y - (A)(Y)
------
B
Where X = the number of shares of Common Stock to be issued to
the Holder.
Y = the number of shares of Common Stock purchasable
upon exercise of all of the Warrant or, if only a
portion of the Warrant is being exercised, the
portion of the Warrant being exercised.
A = the Warrant Price.
B = the Per Share Market Value of one share of Common
Stock.
(d) Issuance of Stock Certificates. In the event of any exercise
of this Warrant in accordance with and subject to the terms and conditions
hereof, (i) certificates for the shares of
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Warrant Stock so purchased shall be dated the date of such exercise and
delivered to the Holder hereof within a reasonable time, not exceeding three (3)
Trading Days after the exercise notice is delivered to the Issuer (the "Delivery
Date") or, at the request of the Holder (provided that a registration statement
under the Securities Act providing for the resale of the Warrant Stock is then
in effect), issued and delivered to the Depository Trust Company ("DTC") account
on the Holder's behalf via the Deposit Withdrawal Agent Commission System
("DWAC") within a reasonable time, not exceeding three (3) Trading Days after
such exercise, and the Holder hereof shall be deemed for all purposes to be the
holder of the shares of Warrant Stock so purchased as of the date of such
exercise and (ii) unless this Warrant has expired, a new Warrant representing
the number of shares of Warrant Stock, if any, with respect to which this
Warrant shall not then have been exercised (less any amount thereof which shall
have been canceled in payment or partial payment of the Warrant Price as
hereinabove provided) shall also be issued to the Holder hereof at the Issuer's
expense within such time.
(e) Compensation for Buy-In on Failure to Timely Deliver
Certificates Upon Exercise. In addition to any other rights available to the
Holder, if the Issuer fails to cause its transfer agent to transmit to the
Holder a certificate or certificates representing the Warrant Stock pursuant to
an exercise on or before the Delivery Date, and if after such date the Holder is
required by its broker to purchase (in an open market transaction or otherwise)
shares of Common Stock to deliver in satisfaction of a sale by the Holder of the
Warrant Stock which the Holder anticipated receiving upon such exercise (a
"Buy-In"), then the Issuer shall (1) pay in cash to the Holder the amount by
which (x) the Holder's total purchase price (including brokerage commissions, if
any) for the shares of Common Stock so purchased exceeds (y) the amount obtained
by multiplying (A) the number of shares of Warrant Stock that the Issuer was
required to deliver to the Holder in connection with the exercise at issue times
(B) the price at which the sell order giving rise to such purchase obligation
was executed, and (2) at the option of the Holder, either reinstate the portion
of the Warrant and equivalent number of shares of Warrant Stock for which such
exercise was not honored or deliver to the Holder the number of shares of Common
Stock that would have been issued had the Issuer timely complied with its
exercise and delivery obligations hereunder. For example, if the Holder
purchases Common Stock having a total purchase price of $11,000 to cover a
Buy-In with respect to an attempted exercise of shares of Common Stock with an
aggregate sale price giving rise to such purchase obligation of $10,000, under
clause (1) of the immediately preceding sentence the Issuer shall be required to
pay the Holder $1,000. The Holder shall provide the Issuer written notice
indicating the amounts payable to the Holder in respect of the Buy-In, together
with applicable confirmations and other evidence reasonably requested by the
Issuer. Nothing herein shall limit a Holder's right to pursue any other remedies
available to it hereunder, at law or in equity including, without limitation, a
decree of specific performance and/or injunctive relief with respect to the
Issuer's failure to timely deliver certificates representing shares of Common
Stock upon exercise of this Warrant as required pursuant to the terms hereof.
(f) Transferability of Warrant. Subject to Section 2(h) hereof,
this Warrant may be transferred by a Holder without the consent of the Issuer.
If transferred pursuant to this paragraph, this Warrant may be transferred on
the books of the Issuer by the Holder hereof in person or by duly authorized
attorney, upon surrender of this Warrant at the principal office of the Issuer,
properly endorsed (by the Holder executing an assignment in the form attached
hereto) and upon payment of any necessary transfer tax or other governmental
charge imposed
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upon such transfer. This Warrant is exchangeable at the principal office of the
Issuer for Warrants to purchase the same aggregate number of shares of Warrant
Stock, each new Warrant to represent the right to purchase such number of shares
of Warrant Stock as the Holder hereof shall designate at the time of such
exchange. All Warrants issued on transfers or exchanges shall be dated the
Original Issue Date and shall be identical with this Warrant except as to the
number of shares of Warrant Stock issuable pursuant thereto.
(g) Continuing Rights of Holder. The Issuer will, at the time of
or at any time after each exercise of this Warrant, upon the request of the
Holder hereof, acknowledge in writing the extent, if any, of its continuing
obligation to afford to such Holder all rights to which such Holder shall
continue to be entitled after such exercise in accordance with the terms of this
Warrant, provided that if any such Holder shall fail to make any such request,
the failure shall not affect the continuing obligation of the Issuer to afford
such rights to such Holder.
(h) Compliance with Securities Laws.
(i) The Holder of this Warrant, by acceptance hereof,
acknowledges that this Warrant and the shares of Warrant Stock to be
issued upon exercise hereof are being acquired solely for the Holder's
own account and not as a nominee for any other party, and for
investment, and that the Holder will not offer, sell or otherwise
dispose of this Warrant or any shares of Warrant Stock to be issued
upon exercise hereof except pursuant to an effective registration
statement, or an exemption from registration, under the Securities Act
and any applicable state securities laws.
(ii) Except as provided in paragraph (iii) below, this
Warrant and all certificates representing shares of Warrant Stock
issued upon exercise hereof shall be stamped or imprinted with a legend
in substantially the following form:
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON
EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE
SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND
UNDER APPLICABLE STATE SECURITIES LAWS OR THE ISSUER SHALL
HAVE RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
THE ISSUER THAT REGISTRATION OF SUCH SECURITIES UNDER THE
SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE
SECURITIES LAWS IS NOT REQUIRED.
(iii) The Issuer agrees to reissue this Warrant or
certificates representing any of the Warrant Stock, without the legend
set forth above if at such time, prior to making any transfer of any
such securities, the Holder shall give written notice to the Issuer
describing the manner and terms of such transfer. Such proposed
transfer will not be
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effected until: (a) either (i) the Issuer has received an opinion of
counsel reasonably satisfactory to the Issuer, to the effect that the
registration of such securities under the Securities Act is not
required in connection with such proposed transfer, (ii) a registration
statement under the Securities Act covering such proposed disposition
has been filed by the Issuer with the Securities and Exchange
Commission and has become effective under the Securities Act, (iii) the
Issuer has received other evidence reasonably satisfactory to the
Issuer that such registration and qualification under the Securities
Act and state securities laws are not required, or (iv) the Holder
provides the Issuer with reasonable assurances that such security can
be sold pursuant to Rule 144 under the Securities Act; and (b) either
(i) the Issuer has received an opinion of counsel reasonably
satisfactory to the Issuer, to the effect that registration or
qualification under the securities or "blue sky" laws of any state is
not required in connection with such proposed disposition, or (ii)
compliance with applicable state securities or "blue sky" laws has been
effected or a valid exemption exists with respect thereto. The Issuer
will respond to any such notice from a holder within three (3) business
days. In the case of any proposed transfer under this Section 2(h), the
Issuer will use reasonable efforts to comply with any such applicable
state securities or "blue sky" laws, but shall in no event be required,
(x) to qualify to do business in any state where it is not then
qualified, (y) to take any action that would subject it to tax or to
the general service of process in any state where it is not then
subject, or (z) to comply with state securities or "blue sky" laws of
any state for which registration by coordination is unavailable to the
Issuer. The restrictions on transfer contained in this Section 2(h)
shall be in addition to, and not by way of limitation of, any other
restrictions on transfer contained in any other section of this
Warrant. Whenever a certificate representing the Warrant Stock is
required to be issued to a Holder without a legend, in lieu of
delivering physical certificates representing the Warrant Stock,
provided the Issuer's transfer agent is participating in the DTC Fast
Automated Securities Transfer program, the Issuer shall use its
reasonable best efforts to cause its transfer agent to electronically
transmit the Warrant Stock to the Holder by crediting the account of
the Holder's Prime Broker with DTC through its DWAC system (to the
extent not inconsistent with any provisions of this Warrant or the
Purchase Agreement).
(i) Accredited Investor Status. In no event may the Holder
exercise this Warrant in whole or in part unless the Holder is an "accredited
investor" as defined in Regulation D under the Securities Act.
3. Stock Fully Paid; Reservation and Listing of Shares;
Covenants.
(a) Stock Fully Paid. The Issuer represents, warrants, covenants
and agrees that all shares of Warrant Stock which may be issued upon the
exercise of this Warrant or otherwise hereunder will, when issued in accordance
with the terms of this Warrant, be duly authorized, validly issued, fully paid
and nonassessable and free from all taxes, liens and charges created by or
through the Issuer. The Issuer further covenants and agrees that during the
period within which this Warrant may be exercised, the Issuer will at all times
have authorized and reserved for the purpose of issuance upon exercise of this
Warrant a number of shares of Common Stock equal to at least one hundred twenty
percent (120%) of the aggregate number of shares of Common Stock to provide for
the exercise of this Warrant.
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(b) Reservation. If any shares of Common Stock required to be
reserved for issuance upon exercise of this Warrant or as otherwise provided
hereunder require registration or qualification with any governmental authority
under any federal or state law before such shares may be so issued, the Issuer
will in good faith use its best efforts as expeditiously as possible at its
expense to cause such shares to be duly registered or qualified. If the Issuer
shall list any shares of Common Stock on any securities exchange or market it
will, at its expense, list thereon, maintain and increase when necessary such
listing, of, all shares of Warrant Stock from time to time issued upon exercise
of this Warrant or as otherwise provided hereunder (provided that such Warrant
Stock has been registered pursuant to a registration statement under the
Securities Act then in effect), and, to the extent permissible under the
applicable securities exchange rules, all unissued shares of Warrant Stock which
are at any time issuable hereunder, so long as any shares of Common Stock shall
be so listed. The Issuer will also so list on each securities exchange or
market, and will maintain such listing of, any other securities which the Holder
of this Warrant shall be entitled to receive upon the exercise of this Warrant
if at the time any securities of the same class shall be listed on such
securities exchange or market by the Issuer.
(c) Covenants. The Issuer shall not by any action including,
without limitation, amending the Certificate of Incorporation or the by-laws of
the Issuer, or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other action, avoid or
seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms
and in the taking of all such actions as may be necessary or appropriate to
protect the rights of the Holder hereof against dilution (to the extent
specifically provided herein) or impairment. Without limiting the generality of
the foregoing, the Issuer will (i) not permit the par value, if any, of its
Common Stock to exceed the then effective Warrant Price, (ii) not amend or
modify any provision of the Certificate of Incorporation or by-laws of the
Issuer in any manner that would adversely affect the rights of the Holders of
the Warrants, (iii) take all such action as may be reasonably necessary in order
that the Issuer may validly and legally issue fully paid and nonassessable
shares of Common Stock, free and clear of any liens, claims, encumbrances and
restrictions (other than as provided herein) upon the exercise of this Warrant,
and (iv) use its best efforts to obtain all such authorizations, exemptions or
consents from any public regulatory body having jurisdiction thereof as may be
reasonably necessary to enable the Issuer to perform its obligations under this
Warrant.
(d) Loss, Theft, Destruction of Warrants. Upon receipt of evidence
satisfactory to the Issuer of the ownership of and the loss, theft, destruction
or mutilation of any Warrant and, in the case of any such loss, theft or
destruction, upon receipt of indemnity or security satisfactory to the Issuer
or, in the case of any such mutilation, upon surrender and cancellation of such
Warrant, the Issuer will make and deliver, in lieu of such lost, stolen,
destroyed or mutilated Warrant, a new Warrant of like tenor and representing the
right to purchase the same number of shares of Common Stock.
4. Adjustment of Warrant Price. The price at which such shares of
Warrant Stock may be purchased upon exercise of this Warrant shall be subject to
adjustment from time to time as set forth in this Section 4. The Issuer shall
give the Holder notice of any event described below which requires an adjustment
pursuant to this Section 4 in accordance with the notice provisions set forth in
Section 5.
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(a) Recapitalization, Reorganization, Reclassification,
Consolidation, Merger or Sale.
(i) In case the Issuer after the Original Issue Date
shall do any of the following (each, a "Triggering Event"): (a)
consolidate or merge with or into any other Person and the Issuer shall
not be the continuing or surviving corporation of such consolidation or
merger, or (b) permit any other Person to consolidate with or merge
into the Issuer and the Issuer shall be the continuing or surviving
Person but, in connection with such consolidation or merger, any
Capital Stock of the Issuer shall be changed into or exchanged for
Securities of any other Person or cash or any other property, or (c)
transfer all or substantially all of its properties or assets to any
other Person, or (d) effect a capital reorganization or
reclassification of its Capital Stock, then, and in the case of each
such Triggering Event, proper provision shall be made so that, upon the
basis and the terms and in the manner provided in this Warrant, the
Holder of this Warrant shall be entitled upon the exercise hereof at
any time after the consummation of such Triggering Event, to the extent
this Warrant is not exercised prior to such Triggering Event, to
receive at the Warrant Price in effect at the time immediately prior to
the consummation of such Triggering Event in lieu of the Common Stock
issuable upon such exercise of this Warrant prior to such Triggering
Event, the Securities, cash and property to which such Holder would
have been entitled upon the consummation of such Triggering Event if
such Holder had exercised the rights represented by this Warrant
immediately prior thereto (including the right of a shareholder to
elect the type of consideration it will receive upon a Triggering
Event), subject to adjustments (subsequent to such corporate action) as
nearly equivalent as possible to the adjustments provided for elsewhere
in this Section 4; provided, however, in the event that the Per Share
Market Value is less than the Warrant Price at the time of such
Triggering Event, the Holder shall receive an amount in cash equal to
the value of this Warrant calculated in accordance with the
Black-Scholes formula. Notwithstanding the foregoing to the contrary,
this Section 4(a)(i) shall only apply if the surviving entity pursuant
to any such Triggering Event is a company that has a class of equity
securities registered pursuant to the Securities Exchange Act of 1934,
as amended, and its common stock is listed or quoted on a national
securities exchange, national automated quotation system or the OTC
Bulletin Board. In the event that the surviving entity pursuant to any
such Triggering Event is not a public company that is registered
pursuant to the Securities Exchange Act of 1934, as amended, or its
common stock is not listed or quoted on a national securities exchange,
national automated quotation system or the OTC Bulletin Board, then the
Holder shall have the right to demand that the Issuer pay to the Holder
an amount in cash equal to the value of this Warrant calculated in
accordance with the Black-Scholes formula.
(ii) Notwithstanding anything contained in this Warrant to
the contrary and so long as the surviving entity pursuant to any
Triggering Event is a company that has a class of equity securities
registered pursuant to the Securities Exchange Act of 1934, as amended,
and its common stock is listed or quoted on a national securities
exchange, national automated quotation system or the OTC Bulletin
Board, a Triggering Event shall not be deemed to have occurred if,
prior to the consummation thereof, each Person (other than the Issuer)
which may be required to deliver any Securities, cash or property upon
the exercise of this Warrant as provided herein shall assume, by
written instrument delivered to, and reasonably satisfactory to, the
Holder of this Warrant, (A) the
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obligations of the Issuer under this Warrant (and if the Issuer shall
survive the consummation of such Triggering Event, such assumption
shall be in addition to, and shall not release the Issuer from, any
continuing obligations of the Issuer under this Warrant) and (B) the
obligation to deliver to such Holder such Securities, cash or property
as, in accordance with the foregoing provisions of this subsection (a),
such Holder shall be entitled to receive, and such Person shall have
similarly delivered to such Holder an opinion of counsel for such
Person, which counsel shall be reasonably satisfactory to such Holder,
or in the alternative, a written acknowledgement executed by the
President or Chief Financial Officer of the Issuer, stating that this
Warrant shall thereafter continue in full force and effect and the
terms hereof (including, without limitation, all of the provisions of
this subsection (a)) shall be applicable to the Securities, cash or
property which such Person may be required to deliver upon any exercise
of this Warrant or the exercise of any rights pursuant hereto.
(b) Stock Dividends, Subdivisions and Combinations.
If at any time the Issuer shall:
(i) make or issue or set a record date for the
holders of the Common Stock for the purpose of entitling them to
receive a dividend payable in, or other distribution of, shares of
Common Stock,
(ii) subdivide its outstanding shares of Common
Stock into a larger number of shares of Common Stock, or
(iii) combine its outstanding shares of Common
Stock into a smaller number of shares of Common Stock,
then (1) the number of shares of Common Stock for which this Warrant is
exercisable immediately after the occurrence of any such event shall be adjusted
to equal the number of shares of Common Stock which a record holder of the same
number of shares of Common Stock for which this Warrant is exercisable
immediately prior to the occurrence of such event would own or be entitled to
receive after the happening of such event, and (2) the Warrant Price then in
effect shall be adjusted to equal (A) the Warrant Price then in effect
multiplied by the number of shares of Common Stock for which this Warrant is
exercisable immediately prior to the adjustment divided by (B) the number of
shares of Common Stock for which this Warrant is exercisable immediately after
such adjustment.
(c) Certain Other Distributions. If at any time the Issuer shall
make or issue or set a record date for the holders of the Common Stock for the
purpose of entitling them to receive any dividend or other distribution of:
(i) cash (other than a cash dividend payable out
of earnings or earned surplus legally available for the payment of
dividends under the laws of the jurisdiction of incorporation of the
Issuer),
(ii) any evidences of its indebtedness, any
shares of stock of any class or any other securities or property of any
nature whatsoever (other than cash, Common
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Stock Equivalents or Additional Shares of Common Stock), or
(iii) any warrants or other rights to subscribe
for or purchase any evidences of its indebtedness, any shares of stock
of any class or any other securities or property of any nature
whatsoever (other than cash, Common Stock Equivalents or Additional
Shares of Common Stock),
then (1) the number of shares of Common Stock for which this Warrant is
exercisable shall be adjusted to equal the product of the number of shares of
Common Stock for which this Warrant is exercisable immediately prior to such
adjustment multiplied by a fraction (A) the numerator of which shall be the Per
Share Market Value of Common Stock at the date of taking such record and (B) the
denominator of which shall be such Per Share Market Value minus the amount
allocable to one share of Common Stock of any such cash so distributable and of
the fair value (as determined in good faith by the Board of Directors of the
Issuer) of any and all such evidences of indebtedness, shares of stock, other
securities or property or warrants or other subscription or purchase rights so
distributable, and (2) the Warrant Price then in effect shall be adjusted to
equal (A) the Warrant Price then in effect multiplied by the number of shares of
Common Stock for which this Warrant is exercisable immediately prior to the
adjustment divided by (B) the number of shares of Common Stock for which this
Warrant is exercisable immediately after such adjustment. A reclassification of
the Common Stock (other than a change in par value, or from par value to no par
value or from no par value to par value) into shares of Common Stock and shares
of any other class of stock shall be deemed a distribution by the Issuer to the
holders of its Common Stock of such shares of such other class of stock within
the meaning of this Section 4(c) and, if the outstanding shares of Common Stock
shall be changed into a larger or smaller number of shares of Common Stock as a
part of such reclassification, such change shall be deemed a subdivision or
combination, as the case may be, of the outstanding shares of Common Stock
within the meaning of Section 4(b).
(d) Issuance of Additional Shares of Common Stock.
(i) In the event the Issuer shall at any time following
the Original Issue Date issue any Additional Shares of Common Stock (otherwise
than as provided in the foregoing subsections (a) through (c) of this Section
4), at a price per share less than the Warrant Price then in effect or without
consideration, then the Warrant Price upon each such issuance shall be adjusted
to that price determined by multiplying the Warrant Price then in effect by a
fraction:
(A) the numerator of which shall be equal to the
sum of (x) the number of shares of Outstanding Common Stock
immediately prior to the issuance of such Additional Shares of
Common Stock plus (y) the number of shares of Common Stock
(rounded to the nearest whole share) which the aggregate
consideration for the total number of such Additional Shares
of Common Stock so issued would purchase at a price per share
equal to the Warrant Price then in effect, and
(B) the denominator of which shall be equal to
the number of shares of Outstanding Common Stock immediately
after the issuance of such Additional Shares of Common Stock.
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(ii) No adjustment of the number of shares of Common Stock
for which this Warrant shall be exercisable shall be made under paragraph (i) of
Section 4(d) upon the issuance of any Additional Shares of Common Stock which
are issued pursuant to the exercise of any Common Stock Equivalents, if any such
adjustment shall previously have been made upon the issuance of such Common
Stock Equivalents (or upon the issuance of any warrant or other rights therefor)
pursuant to Section 4(e).
(e) Issuance of Common Stock Equivalents. If at any time the
Issuer shall issue or sell any Common Stock Equivalents, whether or not the
rights to exchange or convert thereunder are immediately exercisable, and the
aggregate price per share for which Common Stock is issuable upon such
conversion or exchange plus the consideration received by the Issuer for
issuance of such Common Stock Equivalent divided by the number of shares of
Common Stock issuable pursuant to such Common Stock Equivalent (the "Aggregate
Per Common Share Price") shall be less than the Warrant Price then in effect, or
if, after any such issuance of Common Stock Equivalents, the price per share for
which Additional Shares of Common Stock may be issuable thereafter is amended or
adjusted, and such price as so amended shall make the Aggregate Per Common Share
Price be less than the Warrant Price in effect at the time of such amendment or
adjustment, then the Warrant Price upon each such issuance or amendment shall be
adjusted as provided in Section 4(d). No further adjustment of the Warrant Price
then in effect shall be made under this Section 4(e) upon the issuance of any
Common Stock Equivalents which are issued pursuant to the exercise of any
warrants or other subscription or purchase rights therefor, if any such
adjustment shall previously have been made upon the issuance of such warrants or
other rights pursuant to this Section 4(e). No further adjustments of the
Warrant Price then in effect shall be made upon the actual issue of such Common
Stock upon conversion or exchange of such Common Stock Equivalents.
(f) Superseding Adjustment. If, at any time after any adjustment
of the number of shares of Common Stock for which this Warrant is exercisable
and the Warrant Price then in effect shall have been made pursuant to Section
4(e) as the result of any issuance of Common Stock Equivalents, and (i) such
Common Stock Equivalents, or the right of conversion or exchange in such Common
Stock Equivalents, shall expire, and all or a portion of such or the right of
conversion or exchange with respect to all or a portion of such Common Stock
Equivalents, as the case may be, shall not have been exercised, or (ii) the
consideration per share for which shares of Common Stock are issuable pursuant
to such Common Stock Equivalents shall be increased, then such previous
adjustment shall be rescinded and annulled and the Additional Shares of Common
Stock which were deemed to have been issued by virtue of the computation made in
connection with the adjustment so rescinded and annulled shall no longer be
deemed to have been issued by virtue of such computation. Upon the occurrence of
an event set forth in this Section 4(f), there shall be a recomputation made of
the effect of such Common Stock Equivalents on the basis of: (i) treating the
number of Additional Shares of Common Stock theretofore actually issued or
issuable pursuant to the previous exercise of Common Stock Equivalents or any
such right of conversion or exchange, as having been issued on the date or dates
of any such exercise and for the consideration actually received and receivable
therefor, and (ii) treating any such Common Stock Equivalents which then remain
outstanding as having been granted or issued immediately after the time of such
increase of the consideration per share for which Additional Shares of Common
Stock are issuable under such Common Stock
-10-
Equivalents; whereupon a new adjustment of the number of shares of Common Stock
for which this Warrant is exercisable and the Warrant Price then in effect shall
be made, which new adjustment shall supersede the previous adjustment so
rescinded and annulled.
(h) Other Provisions applicable to Adjustments under this Section.
The following provisions shall be applicable to the making of adjustments of the
number of shares of Common Stock for which this Warrant is exercisable and the
Warrant Price then in effect provided for in this Section 4:
(i) Computation of Consideration. To the extent that any
Additional Shares of Common Stock or any Common Stock Equivalents (or any
warrants or other rights therefor) shall be issued for cash consideration, the
consideration received by the Issuer therefor shall be the amount of the cash
received by the Issuer therefor, or, if such Additional Shares of Common Stock
or Common Stock Equivalents are offered by the Issuer for subscription, the
subscription price, or, if such Additional Shares of Common Stock or Common
Stock Equivalents are sold to underwriters or dealers for public offering
without a subscription offering, the initial public offering price (in any such
case subtracting any amounts paid or receivable for accrued interest or accrued
dividends and without taking into account any compensation, discounts or
expenses paid or incurred by the Issuer for and in the underwriting of, or
otherwise in connection with, the issuance thereof). In connection with any
merger or consolidation in which the Issuer is the surviving corporation (other
than any consolidation or merger in which the previously outstanding shares of
Common Stock of the Issuer shall be changed to or exchanged for the stock or
other securities of another corporation), the amount of consideration therefore
shall be, deemed to be the fair value, as determined reasonably and in good
faith by the Board, of such portion of the assets and business of the
nonsurviving corporation as the Board may determine to be attributable to such
shares of Common Stock or Common Stock Equivalents, as the case may be. The
consideration for any Additional Shares of Common Stock issuable pursuant to any
warrants or other rights to subscribe for or purchase the same shall be the
consideration received by the Issuer for issuing such warrants or other rights
plus the additional consideration payable to the Issuer upon exercise of such
warrants or other rights. The consideration for any Additional Shares of Common
Stock issuable pursuant to the terms of any Common Stock Equivalents shall be
the consideration received by the Issuer for issuing warrants or other rights to
subscribe for or purchase such Common Stock Equivalents, plus the consideration
paid or payable to the Issuer in respect of the subscription for or purchase of
such Common Stock Equivalents, plus the additional consideration, if any,
payable to the Issuer upon the exercise of the right of conversion or exchange
in such Common Stock Equivalents. In the event of any consolidation or merger of
the Issuer in which the Issuer is not the surviving corporation or in which the
previously outstanding shares of Common Stock of the Issuer shall be changed
into or exchanged for the stock or other securities of another corporation, or
in the event of any sale of all or substantially all of the assets of the Issuer
for stock or other securities of any corporation, the Issuer shall be deemed to
have issued a number of shares of its Common Stock for stock or securities or
other property of the other corporation computed on the basis of the actual
exchange ratio on which the transaction was predicated, and for a consideration
equal to the fair market value on the date of such transaction of all such stock
or securities or other property of the other corporation. In the event any
consideration received by the Issuer for any securities consists of property
other than cash, the fair market value thereof at the time of issuance or as
otherwise applicable shall be as determined in good faith by the Board. In the
event Common Stock is issued with other shares
-11-
or securities or other assets of the Issuer for consideration which covers both,
the consideration computed as provided in this Section 4(h)(i) shall be
allocated among such securities and assets as determined in good faith by the
Board.
(ii) When Adjustments to Be Made. The adjustments required
by this Section 4 shall be made whenever and as often as any specified event
requiring an adjustment shall occur, except that any adjustment of the number of
shares of Common Stock for which this Warrant is exercisable that would
otherwise be required may be postponed (except in the case of a subdivision or
combination of shares of the Common Stock, as provided for in Section 4(b)) up
to, but not beyond the date of exercise if such adjustment either by itself or
with other adjustments not previously made adds or subtracts less than one
percent (1%) of the shares of Common Stock for which this Warrant is exercisable
immediately prior to the making of such adjustment. Any adjustment representing
a change of less than such minimum amount (except as aforesaid) which is
postponed shall be carried forward and made as soon as such adjustment, together
with other adjustments required by this Section 4 and not previously made, would
result in a minimum adjustment or on the date of exercise. For the purpose of
any adjustment, any specified event shall be deemed to have occurred at the
close of business on the date of its occurrence.
(iii) Fractional Interests. In computing adjustments under
this Section 4, fractional interests in Common Stock shall be taken into account
to the nearest one one-hundredth (1/100th) of a share.
(iv) When Adjustment Not Required. If the Issuer shall
take a record of the holders of its Common Stock for the purpose of entitling
them to receive a dividend or distribution or subscription or purchase rights
and shall, thereafter and before the distribution to stockholders thereof,
legally abandon its plan to pay or deliver such dividend, distribution,
subscription or purchase rights, then thereafter no adjustment shall be required
by reason of the taking of such record and any such adjustment previously made
in respect thereof shall be rescinded and annulled.
(i) Form of Warrant after Adjustments. The form of this Warrant
need not be changed because of any adjustments in the Warrant Price or the
number and kind of Securities purchasable upon the exercise of this Warrant.
(j) Escrow of Warrant Stock. If after any property becomes
distributable pursuant to this Section 4 by reason of the taking of any record
of the holders of Common Stock, but prior to the occurrence of the event for
which such record is taken, and the Holder exercises this Warrant, any shares of
Common Stock issuable upon exercise by reason of such adjustment shall be deemed
the last shares of Common Stock for which this Warrant is exercised
(notwithstanding any other provision to the contrary herein) and such shares or
other property shall be held in escrow for the Holder by the Issuer to be issued
to the Holder upon and to the extent that the event actually takes place, upon
payment of the current Warrant Price. Notwithstanding any other provision to the
contrary herein, if the event for which such record was taken fails to occur or
is rescinded, then such escrowed shares shall be cancelled by the Issuer and
escrowed property returned.
-12-
5. Notice of Adjustments. Whenever the Warrant Price or Warrant
Share Number shall be adjusted pursuant to Section 4 hereof (for purposes of
this Section 5, each an "adjustment"), the Issuer shall cause its Chief
Financial Officer to prepare and execute a certificate setting forth, in
reasonable detail, the event requiring the adjustment, the amount of the
adjustment, the method by which such adjustment was calculated (including a
description of the basis on which the Board made any determination hereunder),
and the Warrant Price and Warrant Share Number after giving effect to such
adjustment, and shall cause copies of such certificate to be delivered to the
Holder of this Warrant promptly after each adjustment. Absent manifest error,
such certificate shall be final and binding on the parties hereto.
6. Fractional Shares. No fractional shares of Warrant Stock will
be issued in connection with any exercise hereof, but in lieu of such fractional
shares, the Issuer shall round the number of shares to be issued upon exercise
up to the nearest whole number of shares.
7. Ownership Cap and Certain Exercise Restrictions. (a)
Notwithstanding anything to the contrary set forth in this Warrant, at no time
may a Holder of this Warrant exercise this Warrant if the number of shares of
Common Stock to be issued pursuant to such exercise would exceed, when
aggregated with all other shares of Common Stock owned by such Holder at such
time, the number of shares of Common Stock which would result in such Holder
beneficially owning (as determined in accordance with Section 13(d) of the
Exchange Act and the rules thereunder) in excess of 4.9% of the then issued and
outstanding shares of Common Stock; provided, however, that upon a holder of
this Warrant providing the Issuer with sixty-one (61) days notice (pursuant to
Section 12 hereof) (the "Waiver Notice") that such Holder would like to waive
this Section 7(a) with regard to any or all shares of Common Stock issuable upon
exercise of this Warrant, this Section 7(a) will be of no force or effect with
regard to all or a portion of the Warrant referenced in the Waiver Notice;
provided, further, that this provision shall be of no further force or effect
during the sixty-one (61) days immediately preceding the expiration of the term
of this Warrant.
(b) The Holder may not exercise the Warrant hereunder to
the extent such exercise would result in the Holder beneficially owning (as
determined in accordance with Section 13(d) of the Exchange Act and the rules
thereunder) in excess of 9.9% of the then issued and outstanding shares of
Common Stock, including shares issuable upon exercise of the Warrant held by the
Holder after application of this Section; provided, however, that upon a holder
of this Warrant providing the Issuer with a Waiver Notice that such holder would
like to waive this Section 7(b) with regard to any or all shares of Common Stock
issuable upon exercise of this Warrant, this Section 7(b) shall be of no force
or effect with regard to those shares of Warrant Stock referenced in the Waiver
Notice; provided, further, that this provision shall be of no further force or
effect during the sixty-one (61) days immediately preceding the expiration of
the term of this Warrant.
8. Definitions. For the purposes of this Warrant, the following
terms have the following meanings:
"Additional Shares of Common Stock" means all shares of Common
Stock issued by the Issuer after the Original Issue Date, and all
shares of Other Common, if any, issued by the Issuer after the Original
Issue Date, except: (i) securities issued (other than
-13-
for cash) in connection with a merger, acquisition, or consolidation,
(ii) securities issued pursuant to the conversion or exercise of
convertible or exercisable securities issued or outstanding on or prior
to the date of the Purchase Agreement or issued pursuant to the
Purchase Agreement (so long as the conversion or exercise price in such
securities are not amended to lower such price and/or adversely affect
the Holders), (iii) the Warrant Stock, (iv) securities issued in
connection with bona fide strategic license agreements or other
partnering arrangements so long as such issuances are not for the
purpose of raising capital, (v) Common Stock issued or the issuance or
grants of options to purchase Common Stock pursuant to the Issuer's
stock option plans and employee stock purchase plans outstanding as
they exist on the Original Issue Date, (vi) any warrants issued to the
placement agent and its designees for the transactions contemplated by
the Purchase Agreement, (vii) the payment of any dividends on the
Issuer's Series B convertible preferred stock, (viii) securities issued
pursuant to a bona fide firm underwritten public offering of the
Issuer's securities, (ix) the payment of liquidated damages pursuant to
the Registration Rights Agreement dated February 17, 2004 between the
Issuer and the parties listed therein and (x) the issuance of Common
Stock upon the exercise or conversion of any securities described in
clauses (i) through (viii) above.
"Board" shall mean the Board of Directors of the Issuer.
"Capital Stock" means and includes (i) any and all shares,
interests, participations or other equivalents of or interests in
(however designated) corporate stock, including, without limitation,
shares of preferred or preference stock, (ii) all partnership interests
(whether general or limited) in any Person which is a partnership,
(iii) all membership interests or limited liability company interests
in any limited liability company, and (iv) all equity or ownership
interests in any Person of any other type.
"Certificate of Incorporation" means the Certificate of
Incorporation of the Issuer as in effect on the Original Issue Date,
and as hereafter from time to time amended, modified, supplemented or
restated in accordance with the terms hereof and thereof and pursuant
to applicable law.
"Common Stock" means the Common Stock, $0.0001 par value per
share, of the Issuer and any other Capital Stock into which such stock
may hereafter be changed.
"Common Stock Equivalent" means any Convertible Security or
warrant, option or other right to subscribe for or purchase any
Additional Shares of Common Stock or any Convertible Security.
"Convertible Securities" means evidences of Indebtedness,
shares of Capital Stock or other Securities which are or may be at any
time convertible into or exchangeable for Additional Shares of Common
Stock. The term "Convertible Security" means one of the Convertible
Securities.
"Governmental Authority" means any governmental, regulatory or
self-regulatory entity, department, body, official, authority,
commission, board, agency or instrumentality, whether federal, state or
local, and whether domestic or foreign.
-14-
"Holders" mean the Persons who shall from time to time own any
Warrant. The term "Holder" means one of the Holders.
"Independent Appraiser" means a nationally recognized or major
regional investment banking firm or firm of independent certified
public accountants of recognized standing (which may be the firm that
regularly examines the financial statements of the Issuer) that is
regularly engaged in the business of appraising the Capital Stock or
assets of corporations or other entities as going concerns, and which
is not affiliated with either the Issuer or the Holder of any Warrant.
"Issuer" means Glowpoint, Inc., a Delaware corporation, and
its successors.
"Majority Holders" means at any time the Holders of Warrants
exercisable for a majority of the shares of Warrant Stock issuable
under the Warrants at the time outstanding.
"Notes" means the senior secured convertible promissory notes
issued by the Issuer to the Purchasers pursuant to the Purchase
Agreement.
"Original Issue Date" means March 31, 2006.
"OTC Bulletin Board" means the over-the-counter electronic
bulletin board.
"Other Common" means any other Capital Stock of the Issuer of
any class which shall be authorized at any time after the date of this
Warrant (other than Common Stock) and which shall have the right to
participate in the distribution of earnings and assets of the Issuer
without limitation as to amount.
"Outstanding Common Stock" means, at any given time, the
aggregate amount of outstanding shares of Common Stock, assuming full
exercise, conversion or exchange (as applicable) of all options,
warrants and other Securities which are convertible into or exercisable
or exchangeable for, and any right to subscribe for, shares of Common
Stock that are outstanding at such time.
"Person" means an individual, corporation, limited liability
company, partnership, joint stock company, trust, unincorporated
organization, joint venture, Governmental Authority or other entity of
whatever nature.
"Per Share Market Value" means on any particular date (a) the
last closing sale price per share of the Common Stock on such date on
the OTC Bulletin Board or another registered national stock exchange on
which the Common Stock is then listed, or if there is no such price on
such date, then the closing sale price on such exchange or quotation
system on the date nearest preceding such date, or (b) if the Common
Stock is not listed then on the OTC Bulletin Board or any registered
national stock exchange, the last closing sale price for a share of
Common Stock in the over-the-counter market, as reported by the OTC
Bulletin Board or in the National Quotation Bureau Incorporated or
-15-
similar organization or agency succeeding to its functions of reporting
prices) at the close of business on such date, or (c) if the Common
Stock is not then reported by the OTC Bulletin Board or the National
Quotation Bureau Incorporated (or similar organization or agency
succeeding to its functions of reporting prices), then the average of
the "Pink Sheet" quotes for the five (5) Trading Days preceding such
date of determination, or (d) if the Common Stock is not then publicly
traded the fair market value of a share of Common Stock as determined
by an Independent Appraiser selected in good faith by the Majority
Holders; provided, however, that the Issuer, after receipt of the
determination by such Independent Appraiser, shall have the right to
select an additional Independent Appraiser, in which case, the fair
market value shall be equal to the average of the determinations by
each such Independent Appraiser; and provided, further that all
determinations of the Per Share Market Value shall be appropriately
adjusted for any stock dividends, stock splits or other similar
transactions during such period. The determination of fair market value
by an Independent Appraiser shall be based upon the fair market value
of the Issuer determined on a going concern basis as between a willing
buyer and a willing seller and taking into account all relevant factors
determinative of value, and shall be final and binding on all parties.
"Purchase Agreement" means the Note and Warrant Purchase
Agreement dated as of March 31, 2006, among the Issuer and the
Purchasers.
"Purchasers" means the purchasers of the Notes and the
Warrants issued by the Issuer pursuant to the Purchase Agreement.
"Securities" means any debt or equity securities of the
Issuer, whether now or hereafter authorized, any instrument convertible
into or exchangeable for Securities or a Security, and any option,
warrant or other right to purchase or acquire any Security. "Security"
means one of the Securities.
"Securities Act" means the Securities Act of 1933, as amended,
or any similar federal statute then in effect.
"Subsidiary" means any corporation at least 50% of whose
outstanding Voting Stock shall at the time be owned directly or
indirectly by the Issuer or by one or more of its Subsidiaries, or by
the Issuer and one or more of its Subsidiaries.
"Term" has the meaning specified in Section 1 hereof.
"Trading Day" means any day during which The New York Stock
Exchange shall be open for business.
"Voting Stock" means, as applied to the Capital Stock of any
corporation, Capital Stock of any class or classes (however designated)
having ordinary voting power for the election of a majority of the
members of the Board of Directors (or other governing body) of such
corporation, other than Capital Stock having such power only by reason
of the happening of a contingency.
-16-
"Warrants" means the Warrants issued and sold pursuant to the
Purchase Agreement, including, without limitation, this Warrant, and
any other warrants of like tenor issued in substitution or exchange for
any thereof pursuant to the provisions of Section 2(c), 2(d) or 2(e)
hereof or of any of such other Warrants.
"Warrant Price" initially means $0.01, as such price may be
adjusted from time to time as shall result from the adjustments
specified in this Warrant, including Section 4 hereto.
"Warrant Share Number" means at any time the aggregate number
of shares of Warrant Stock which may at such time be purchased upon
exercise of this Warrant, after giving effect to all prior adjustments
and increases to such number made or required to be made under the
terms hereof.
"Warrant Stock" means Common Stock issuable upon exercise of
any Warrant or Warrants or otherwise issuable pursuant to any Warrant
or Warrants.
9. Other Notices. In case at any time:
(A) the Issuer shall make any
distributions to the holders of
Common Stock; or
(B) the Issuer shall authorize the
granting to all holders of its
Common Stock of rights to subscribe
for or purchase any shares of
Capital Stock of any class or other
rights; or
(C) there shall be any reclassification
of the Capital Stock of the Issuer;
or
(D) there shall be any capital
reorganization by the Issuer; or
(E) there shall be any (i) consolidation
or merger involving the Issuer or
(ii) sale, transfer or other
disposition of all or substantially
all of the Issuer's property, assets
or business (except a merger or
other reorganization in which the
Issuer shall be the surviving
corporation and its shares of
Capital Stock shall continue to be
outstanding and unchanged and except
a consolidation, merger, sale,
transfer or other disposition
involving a wholly-owned
Subsidiary); or
(F) there shall be a voluntary or
involuntary dissolution, liquidation
or winding-up of the Issuer or any
partial liquidation of the Issuer or
distribution to holders of Common
Stock;
then, in each of such cases, the Issuer shall give written notice to the Holder
of the date on which (i) the books of the Issuer shall close or a record shall
be taken for such dividend, distribution or
-17-
subscription rights or (ii) such reorganization, reclassification,
consolidation, merger, disposition, dissolution, liquidation or winding-up, as
the case may be, shall take place. Such notice also shall specify the date as of
which the holders of Common Stock of record shall participate in such dividend,
distribution or subscription rights, or shall be entitled to exchange their
certificates for Common Stock for securities or other property deliverable upon
such reorganization, reclassification, consolidation, merger, disposition,
dissolution, liquidation or winding-up, as the case may be. Such notice shall be
given at least twenty (20) days prior to the action in question and not less
than ten (10) days prior to the record date or the date on which the Issuer's
transfer books are closed in respect thereto. Except as otherwise specifically
provided herein, no holder, as such, of this Warrant shall be entitled to vote
or receive dividends or be deemed the holder of shares of the Issuer for any
purpose, nor shall anything contained in this Warrant be construed to confer
upon the holder hereof, as such, any of the rights of a stockholder of the
Issuer or any right to vote, give or withhold consent to any corporate action
(whether any reorganization, issue of stock, reclassification of stock,
consolidation, merger, conveyance or otherwise), receive notice of meetings,
receive dividends or subscription rights, or otherwise, prior to the issuance to
the holder of this Warrant of the Warrant Shares which he or she is then
entitled to receive upon the due exercise of this Warrant. This Warrant entitles
the Holder to receive copies of all financial and other information distributed
or required to be distributed to the holders of the Common Stock.
10. Amendment and Waiver. Any term, covenant, agreement or
condition in this Warrant may be amended, or compliance therewith may be waived
(either generally or in a particular instance and either retroactively or
prospectively), by a written instrument or written instruments executed by the
Issuer and the Majority Holders; provided, however, that no such amendment or
waiver shall reduce the Warrant Share Number, increase the Warrant Price,
shorten the period during which this Warrant may be exercised or modify any
provision of this Section 10 without the consent of the Holder of this Warrant.
No consideration shall be offered or paid to any person to amend or consent to a
waiver or modification of any provision of this Warrant unless the same
consideration is also offered to all holders of the Warrants.
11. Governing Law; Jurisdiction. This Warrant shall be governed by
and construed in accordance with the internal laws of the State of New York,
without giving effect to any of the conflicts of law principles which would
result in the application of the substantive law of another jurisdiction. This
Warrant shall not be interpreted or construed with any presumption against the
party causing this Warrant to be drafted. The Issuer and the Holder agree that
venue for any dispute arising under this Warrant will lie exclusively in the
state or federal courts located in New York County, New York, and the parties
irrevocably waive any right to raise forum non conveniens or any other argument
that New York is not the proper venue. The Issuer and the Holder irrevocably
consent to personal jurisdiction in the state and federal courts of the state of
New York. The Issuer and the Holder consent to process being served in any such
suit, action or proceeding by mailing a copy thereof to such party at the
address in effect for notices to it under this Warrant and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing in this Section 11 shall affect or limit any right to serve
process in any other manner permitted by law. The parties hereby waive all
rights to a trial by jury.
12. Notices. Any notice, demand, request, waiver or other
communication required or permitted to be given hereunder shall be in writing
and shall be effective (a) upon hand
-18-
delivery by telecopy or facsimile at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the second business day following the date of mailing
by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be:
If to the Issuer: Glowpoint, Inc.
000 Xxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Chief Executive Officer
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
with copies (which copies
shall not constitute notice
to the Issuer) to: Winston & Xxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx X.X. Xxxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
If to any Holder: At the address of such Holder set forth on
Exhibit A to this Agreement, with copies to
Holder's counsel as set forth on
Exhibit A or as specified in writing by such
Holder with copies to:
with copies (which copies
shall not constitute notice)
to: Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx X. Xxxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
Any party hereto may from time to time change its address for notices
by giving written notice of such changed address to the other party hereto.
13. Warrant Agent. The Issuer may, by written notice to each
Holder of this Warrant, appoint an agent having an office in New York, New York
for the purpose of issuing shares of Warrant Stock on the exercise of this
Warrant pursuant to subsection (b) of Section 2 hereof, exchanging this Warrant
pursuant to subsection (d) of Section 2 hereof or replacing this Warrant
pursuant to subsection (d) of Section 3 hereof, 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.
-19-
14. Remedies. The Issuer stipulates that the remedies at law of
the Holder of this Warrant in the event of any default or threatened default by
the Issuer in the performance of or compliance with any of the terms of this
Warrant are not and will not be adequate and that, to the fullest extent
permitted by law, such terms may be specifically enforced by a decree for the
specific performance of any agreement contained herein or by an injunction
against a violation of any of the terms hereof or otherwise.
15. Successors and Assigns. This Warrant and the rights evidenced
hereby shall inure to the benefit of and be binding upon the successors and
assigns of the Issuer, the Holder hereof and (to the extent provided herein) the
Holders of Warrant Stock issued pursuant hereto, and shall be enforceable by any
such Holder or Holder of Warrant Stock.
16. Modification and Severability. If, in any action before any
court or agency legally empowered to enforce any provision contained herein, any
provision hereof is found to be unenforceable, then such provision shall be
deemed modified to the extent necessary to make it enforceable by such court or
agency. If any such provision is not enforceable as set forth in the preceding
sentence, the unenforceability of such provision shall not affect the other
provisions of this Warrant, but this Warrant shall be construed as if such
unenforceable provision had never been contained herein.
17. Headings. The headings of the Sections of this Warrant are for
convenience of reference only and shall not, for any purpose, be deemed a part
of this Warrant.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
-20-
IN WITNESS WHEREOF, the Issuer has executed this Series B Warrant as of
the day and year first above written.
GLOWPOINT, INC.
By:
---------------------------------
Name:
Title:
-21-
Schedule A
Restructuring Costs
1. $200,000 in connection with severance payments for reduction in force,
defined as any costs related to a reduction in force, including ongoing
contractual payments for employees terminated in support of
restructuring of the business.
2. $50,000 in connection with termination liabilities, defined as any
costs to terminate a contract or consolidate facilities as part of the
restructuring plan.
3. The costs of this capital raise, defined as the amortization of costs
related to this financing, calculated in accordance with GAAP.
4. $450,000 of depreciation expense, calculated in accordance with GAAP.
5. $150,000 of deferred non-cash compensation expense, calculated in
accordance with GAAP.
-22-
EXERCISE FORM
SERIES B WARRANT
GLOWPOINT, INC.
The undersigned _______________, pursuant to the provisions of the within
Warrant, hereby elects to purchase _____ shares of Common Stock of Glowpoint,
Inc. covered by the within Warrant.
Dated: _________________ Signature
---------------------------
Address ____________________
____________________
Number of shares of Common Stock beneficially owned or deemed beneficially owned
by the Holder on the date of Exercise: _________________________
ASSIGNMENT
FOR VALUE RECEIVED, _________________ hereby sells, assigns and transfers unto
__________________ the within Warrant and all rights evidenced thereby and does
irrevocably constitute and appoint _____________, attorney, to transfer the said
Warrant on the books of the within named corporation.
Dated: _________________ Signature
---------------------------
Address ____________________
____________________
PARTIAL ASSIGNMENT
FOR VALUE RECEIVED, _________________ hereby sells, assigns and transfers unto
__________________ the right to purchase _________ shares of Warrant Stock
evidenced by the within Warrant together with all rights therein, and does
irrevocably constitute and appoint ___________________, attorney, to transfer
that part of the said Warrant on the books of the within named corporation.
Dated: _________________ Signature
---------------------------
Address ____________________
____________________
FOR USE BY THE ISSUER ONLY:
-23-
This Warrant No. W-___ canceled (or transferred or exchanged) this _____ day of
___________, _____, shares of Common Stock issued therefor in the name of
_______________, Warrant No. W-_____ issued for ____ shares of Common Stock in
the name of _______________.
-24-
