EXHIBIT 4.11
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR APPLICABLE STATE SECURITIES LAWS. THE
WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF UNLESS IT HAS BEEN REGISTERED UNDER THOSE LAWS OR UNLESS THE
COMPANY HAS RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO IT THAT SUCH
DISPOSITION IS IN COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE STATE
SECURITIES LAWS.
Right to Purchase 10,250,000 Shares
of Common Stock of Vsource, Inc.
VSOURCE, INC.
Common Stock Purchase Warrant
VSOURCE, INC., a Delaware corporation (the "Company"), hereby certifies
that, for value received, BAPEF Investments XII Ltd. (the "Holder"), whose
address is c/o International Private Equity Services Ltd., X.X. Xxx 000, 00-00
Xxxxxxxx Xxxx, Xxxxxxx XX GY13ZD, is entitled, subject to the terms set forth
below, to purchase from the Company at any time or from time to time on or
before 5:00 p.m., Pacific Standard time, on July 12, 2006 (the "Expiration
Date") Ten Million Two Hundred Fifty Thousand (10,250,000) fully paid and
nonassessable shares of common stock of the Company (the "Common Stock") at a
purchase price per share equal to the Purchase Price, as defined herein. The
number of such shares of Common Stock and the Purchase Price are subject to
adjustment as provided in this Warrant. The initial purchase price for shares
subject to this Warrant will be 10/100 Dollars ($0.10) per share (the "Initial
Purchase Price"), and will be adjusted from time to time as provided herein.
The Initial Purchase Price or, if such price has been adjusted, the price per
share of Common Stock as last adjusted pursuant to the terms hereof is referred
to as the "Purchase Price" herein.
1. EXERCISE OF WARRANT.
(a) At any time while the Conversion Conditions have been satisfied,
this Warrant may be exercised by the Holder hereof in full or in part at
any time or from time to time until the Expiration Date by surrender of
this Warrant and the subscription form annexed hereto (duly executed by the
Holder), to the Company, and by making payment in cash or by certified or
official bank check payable to the order of the Company, in the amount
obtained by multiplying (i) the number of shares of Common Stock designated
by the Holder in the subscription form by (ii) the Purchase Price then in
effect. On any partial exercise the Company will forthwith issue and
deliver to or upon the order of the Holder hereof a new
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Warrant of like tenor, in the name of the Holder hereof, providing in the
aggregate on the face or faces thereof for the purchase of the number of
shares of Common Stock for which such Warrant may still be exercised.
(b) At any time while the Conversion Conditions have been satisfied,
in lieu of exercising this Warrant as provided above, the Holder may elect
to receive, without the payment by the Holder of any additional
consideration, shares of Common Stock equal to the value of this Warrant
(or the portion thereof being canceled) by surrender of this Warrant at the
principal office of the Company together with the subscription form
attached hereto indicating such election, in which event the Company shall
issue to the holder hereof a number of Warrant Shares computed using the
following formula:
Y(A-B)
------
X = A
Where: X = The number of shares of Common Stock to be issued to the
Holder pursuant to this net exercise;
Y = The number of shares of Common Stock designated by the Holder
in the subscription form;
A = The then fair market value of one share of Common Stock as of
the date the election is made;
B = The Exercise Price (as adjusted to the date of the election).
For purposes of this Section 1(b), the fair market value of one share of
Common Stock as of a particular date shall be determined as follows: (i) if
traded on a securities exchange or through the Nasdaq National Market or
SmallCap System, the value shall be deemed to be the average of the closing
prices of the securities on such exchange over the thirty (30) day period
ending three (3) days prior to the net exercise election; (ii) if traded
over-the-counter, the value shall be deemed to be the average of the
closing prices over the thirty (30) day period ending three (3) days prior
to the net exercise; and (iii) if there is no active public market, the
value shall be the fair market value thereof, as determined in good faith
by the Board of Directors of the Company.
(c) For purposes of this Section 1, "Conversion Conditions" means
either:
(1) The Company has (A) adopted, had approved by its shareholders
and has filed with the Secretary of State of Delaware (and there shall
remain in effect) an amendment to the Company's Certificate of
Incorporation to increase the authorized shares of the Company's
Common Stock to at least 200 million shares and (B) obtained the
approval of its shareholders of the issuance of shares of Common Stock
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upon the exercise of this Warrant pursuant to Sections 1(a) or 1(b)
hereof, or
(2) The Company has determined not to seek one or both of the
approvals referred to in clause (1) above, and the Company has
received an opinion of counsel, which has not been withdrawn, to the
effect that (A) such approval that is not being sought is not required
for the Company to issue shares of Common Stock upon the exercise of
this Warrant pursuant to Sections 1(a) or 1(b) hereof, (B) such shares
of Common Stock, upon issuance, will be fully paid, validly issued and
nonassessable, and (C) such issuance would not violate the rules or
regulations of any securities exchange or market on which any of the
Company's securities is then listed, if any
The Company will give the Holder prompt written notice of (a) the satisfaction
of the Conversion Conditions, and (b) if at any time after satisfaction of the
Conversion Conditions pursuant to clause (2) above, the Conversion Conditions
cease to be satisfied.
(d) In the event that the Conversion Conditions are not satisfied
prior to February 15, 2002, or the Conversion Conditions fail to be
satisfied at any time on or after February 15, 2002, then the Holder shall
have the right, at any time after June 30, 2002, to require the Company to
redeem all or any portion of this Warrant for a redemption price equal to
the number of shares of Common Stock into which this Warrant is otherwise
exercisable multiplied by the greater of (i) $0.30 (adjusted to reflect
stock splits, stock dividends and similar transactions) or (ii) the fair
market value of one share of Common Stock (as determined pursuant to
Section 1(b) hereof)(the "Redemption Amount"); provided, that in no event
shall the Redemption Amount exceed $0.35 per share (adjusted to reflect
stock splits, stock dividends and similar transactions). In order to
complete a redemption pursuant to this Section 1(d), the Holder shall
submit to the Company an executed notice setting forth the number of shares
subject to this Warrant to be redeemed (a "Redemption Notice") along with
this Warrant. The Company shall pay the Holder the Redemption Amount, in
cash, with respect to each share subject to this Warrant being redeemed
pursuant to the Redemption Notice within ten (10) business days of the
Company's receipt of a Redemption Notice.
2. DELIVERY OF STOCK CERTIFICATES, ETC., ON EXERCISE. As soon as
practicable after the exercise of this Warrant, the Company will cause to be
issued in the name of and delivered to the Holder hereof a certificate for the
number of fully paid and nonassessable shares of Common Stock (or Other
Securities) to which the Holder shall be entitled on such exercise, plus, in
lieu of any fractional share to which the Holder would otherwise be entitled,
cash equal to such fraction multiplied by the then current fair market value as
determined pursuant to Section 1(b) above of one full share, together with any
other stock or other securities or property (including cash, where applicable)
to which the Holder is entitled upon such exercise. "Other Securities" shall
mean any stock (other than Common Stock) and other securities of the Company or
any other person (corporate or otherwise) which the Holder at any time shall be
entitled to receive, or shall have received, on the exercise of this Warrant, in
lieu of or in addition to Common Stock, or which at any time shall be issuable
or shall have
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been issued in exchange for or in replacement of Common stock or Other
Securities pursuant to Sections 3 or 4.
3. ADJUSTMENTS.
(a) Initial Purchase Price: Subsequent Adjustment of Price and Number
of Purchaseable Shares. The Initial Purchase Price will be adjusted from
time to time as provided below. The Initial Purchase Price or, if such
price has been adjusted, the price per share of Common Stock as last
adjusted pursuant to the terms hereof is referred to as the "Purchase
Price" herein. Upon each adjustment of the Purchase Price, the Holder will
thereafter be entitled to purchase, at the Purchase Price resulting from
such adjustment, the number of shares of Common Stock obtained by
multiplying the Purchase Price in effect immediately before such adjustment
by the number of shares of Common Stock purchasable pursuant to this
Warrant immediately before such adjustment and dividing the product by the
Purchase Price resulting from such adjustment.
(b) Adjustment for Stock Splits and Combinations. If the Company at
any time or from time to time after the date of this Warrant effects a
subdivision of the outstanding Common Stock, by stock split or otherwise,
the Purchase Price then in effect immediately before that subdivision shall
be proportionately decreased; and, conversely, if the Company at any time
or from time to time after the date of this Warrant combines the
outstanding shares of Common Stock, by reverse stock split or otherwise,
the Purchase Price then in effect immediately before that combination
shall be proportionately increased. Any adjustment under this Section 3(b)
shall become effective at the close of business on the date the subdivision
or combination becomes effective.
(c) Adjustment for Certain Dividends and Distributions. In the event
the Company at any time or from time to time after the date of this Warrant
either makes, or fixes a record date for the determination of holders of
Common Stock entitled to receive, a dividend or other distribution payable
in additional shares of Common Stock, then and in each such event the
Purchase Price then in effect shall be decreased as of the time of such
issuance or, in the event such a record date is fixed, as of the close of
business on such record date, by multiplying the Purchase Price then in
effect by a fraction (1) the numerator of which is the total number of
shares of Common Stock issued and outstanding immediately prior to the time
of such issuance on the close of business on such record date, and (2) the
denominator of which shall be (i) the total number of shares of Common
Stock issued and outstanding immediately prior to the time of such issuance
or the close of business on such record date plus (ii) the number of shares
of Common Stock issuable in payment of such dividend or distribution;
provided, however, that if such record date is fixed and such dividend is
not fully paid or if such distribution is not fully made on the date fixed
therefor, the Purchase Price shall be recomputed accordingly as of the
close of business on such record date or date fixed therefor and thereafter
the Purchase Price shall be adjusted pursuant to this Section 3(c) as of
the time of actual payment of such dividend or distribution. For purposes
of the foregoing
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formula, "the total number of shares of Common Stock issued and
outstanding" on a particular date shall include shares of Common Stock
issuable upon conversion of stock or securities convertible into Common
Stock and the exercise of warrants, options or rights for the purchase of
Common Stock which are outstanding on such date.
(d) Adjustments for Other Dividends and Distributions. In the event
the Company at any time or from time to time after the date of this Warrant
makes, or fixes a record date for the determination of holders of Common
Stock entitled to receive, a dividend or other distribution payable in
securities of the Company other than shares of Common Stock, then and in
each such event, provision shall be made so that the Holder shall receive
upon exercise hereof, in addition to the number of shares of Common Stock
receivable thereupon, the amount of securities of the Company which it
would have received had this Warrant been converted into Common Stock as of
the date of such event and had it thereafter, during the period from the
date of such event to and including the date of exercise, retained such
securities receivable by it as aforesaid during such period, subject to all
other adjustments called for during such period under this Section 3 with
respect to the rights of the Holder.
(e) Adjustment for Recapitalization, Reclassification, or Exchange. If
the Common Stock issuable upon the exercise of this Warrant is changed into
the same or a different number of shares of any class or classes of stock
of the Company, whether by recapitalization, reclassification or other
exchange (other than a subdivision or combination of shares, or a stock
dividend or a reorganization, merger, consolidation or sale of assets,
provided for elsewhere in this Section 3), then and in any such event the
Holder shall have the right thereafter to exercise this Warrant to purchase
the kind and amount of stock and other securities and property receivable
upon such recapitalization, reclassification or other exchange by holders
of the number of shares of Common Stock which might have been purchased
under this Warrant immediately prior to such recapitalization,
reclassification or other exchange, all subject to further adjustment as
provided herein.
(f) Reorganizations, Mergers, Consolidations or Sales of Assets. If at
any time or from time to time there is a capital reorganization of the
Common Stock (other than a subdivision or combination of shares or a stock
dividend or a recapitalization, reclassification or other exchange of
shares, provided for elsewhere in this Section 3) or a merger or
consolidation of the Company with or into another corporation, or the sale
of all or substantially all of the Company's assets to any other person,
then, as a part of such capital reorganization, merger, consolidation or
sale, provision shall be made so that the Holder shall thereafter be
entitled to receive upon exercise of this Warrant the number of shares of
stock or other securities or property of the Company, or of the successor
corporation resulting from such capital reorganization, merger,
consolidation or sale, to which a holder of the number of shares of Common
Stock deliverable upon such conversion would have been entitled on such
capital reorganization, merger, consolidation or sale. In any such case,
appropriate adjustment shall be made in the application of the provisions
of this Section 3 with respect to the rights of the Holder after the
capital reorganization, merger, consolidation or sale to the end that the
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provisions of this Section 3 (including the number of shares deliverable
upon exercise of this Warrant) shall continue to be applicable after that
event and shall be as nearly equivalent to the provisions hereof as may be
practicable.
(g) Sale of Shares Below Conversion Price.
(1) If at any time or from time to time after the date hereof
the Company issues or sells, or is deemed by the express provisions
of this Section 3(g) to have issued or sold, Additional Shares of
Common Stock (as hereinafter defined), other than as a dividend or
other distribution on any class of stock as provided in Section 2 and
other than upon a subdivision or combination of shares of Common
Stock as provided in Section 2, for an Effective Price (as
hereinafter defined) less than the then existing Conversion Price,
then and in each such case the then existing Conversion Price shall
be reduced to such Effective Price.
(2) For the purpose of making any adjustment required under this
Section 3(g), the consideration received by the Company for any issue
or sale of securities shall (A) to the extent it consists of cash be
computed at the amount of cash received by the Company, (B) to the
extent it consists of property other than cash, be computed at the
fair value of that property as determined in good faith by the Board,
and (C) if Additional Shares of Common Stock, Convertible Securities
(as hereinafter defined) or rights or options to purchase either
Additional Shares of Common Stock or Convertible Securities are
issued or sold together with other stock or securities or other
assets of the Company for a consideration which covers both, be
computed as the portion of the consideration so received that may be
reasonably determined in good faith by the Board to be allocable to
such Additional Shares of Common Stock, Convertible Securities or
rights or options.
(3) For the purpose of the adjustment required under this
Section 3(g), if the Company issues or sells any rights or options
for the purchase of, or stock or other securities convertible into,
Additional Shares of Common Stock (such convertible stock or
securities being hereinafter referred to as "Convertible Securities")
and if the Effective Price of such Additional Shares of Common Stock
is less than the Conversion Price then in effect, then in each case
the Company shall be deemed to have issued at the time of the
issuance of such rights or options or Convertible Securities the
maximum number of Additional Shares of Common Stock issuable upon
exercise or conversion thereof and to have received as consideration
for the issuance of such shares an amount equal to the total amount
of the consideration, if any, received by the Company for the
issuance of such rights or options or Convertible Securities, plus,
in the case of such rights or options, the minimum amounts of
consideration, if any, payable to the Company upon the exercise of
such rights or options, plus, in the case of Convertible Securities,
the minimum amounts of consideration, if any, payable to the Company
(other than by cancellation of liabilities
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or obligations evidenced by such Convertible Securities) upon the
conversion thereof. No further adjustment of the Conversion Price,
adjusted upon the issuance of such rights, options or Convertible
Securities, shall be made as a result of the actual issuance of
Additional Shares of Common Stock on the exercise of any such rights
or options or the conversion of any such Convertible Securities. If
any such rights or options or the conversion privilege represented by
any such Convertible Securities shall expire without having been
exercised, the Conversion Price adjusted upon the issuance of such
rights, options or Convertible Securities shall be readjusted to the
Conversion Price which would have been in effect had an adjustment
been made on the basis that the only Additional Shares of Common Stock
so issued were the Additional Shares of Common Stock, if any, actually
issued or sold on the exercise of such rights or options or rights of
conversion of such Convertible Securities, and such Additional Shares
of Common Stock, if any, were issued or sold for the consideration
actually received by the Company upon such exercise, plus the
consideration, if any, actually received by the Company for the
granting for all such rights or options, whether or not exercised,
plus the consideration received for issuing or selling the Convertible
Securities actually converted, plus the consideration, if any,
actually received by the Company (other than by cancellation of
liabilities or obligations evidenced by such Convertible Securities)
on the conversion of such Convertible Securities.
(4) "Additional Shares of Common Stock" shall mean all shares of
Common Stock issued (or deemed issued hereunder) by the Company after
the date hereof, whether or not subsequently reacquired or retired by
the Company, other than: (A) shares of Common Stock issued upon
conversion or exchange of the Series 3-A Preferred Stock or any other
options or warrants or convertible securities outstanding or issuable
on the date hereof; (B) shares of Common Stock issued upon conversion
or exchange of the Series 2-A Preferred Stock pursuant to Section 7 of
the Certificate of Designation creating the Series 2-A Preferred
Stock; (C) shares of Common Stock issued upon conversion or exchange
of the Series 1-A Preferred Stock pursuant to Article 4, Section C.5
of the Certificate of Incorporation; (D) shares of Common Stock
issuable or issued to the directors, officers and employees of or
consultants to the Company pursuant to a plan approved by the Board of
Directors of the Company and (E) shares of Common Stock issuable or
issued pursuant to equipment financing or leasing arrangements, and
(F) shares of Common Stock issuable pursuant to the warrants, if any,
which may be issued in connection with the Exchangeable Note and
Warrant Purchase Agreement dated as of July 12, 2001, by and among the
Company, XxxXxx000.xxx Ltd., NetCel360 Sdn Bhd, and the Purchasers
named therein. The "Effective Price" of Additional Shares of Common
Stock shall mean the quotient determined by dividing the total number
of Additional Shares of Common Stock issued or sold, or deemed to have
been issued or sold by the Company under this Section 3(g), into the
aggregate consideration received, or deemed to have been
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received by the Company for such issue under this Section 3(g), for
such Additional Shares of Common Stock.
(h) Certificate of Adjustment. Upon the occurrence of each adjustment
or readjustment of the Purchase Price and/or the number of shares of Common
Stock subject to this Warrant, the Company at its expense shall promptly
compute such adjustment or readjustment in accordance with the terms
hereof, and shall prepare and furnish to the Holder a certificate setting
forth such adjustment or readjustment and showing in detail the facts upon
which such adjustment or readjustment is based.
4. EXERCISE UPON REORGANIZATION, CONSOLIDATION, MERGER, ETC. In case at any
time or from time to time, the Company intends to (a) effect a reorganization,
(b) consolidate with or merge into any other person, (c) sell or transfer all or
substantially all of its properties or assets to any other person, (d)
dissolve, (e) consummate an initial public offering of its securities; or if
the Company is sold through the sale of its capital stock, then,
notwithstanding any other provision of this Warrant, in each such case, as a
condition of such reorganization, consolidation, merger, sale dissolution,
conveyance, or offering the Company shall give at least fifteen (15) business
days notice to the Holder of such pending transaction whereby the Holder shall
have the right to exercise this Warrant prior to any such reorganization,
consolidation, merger, sale, dissolution, conveyance or offering. Any exercise
of this Warrant pursuant to notice under this Section shall be conditioned upon
the closing of such reorganization, consolidation, merger, sale, dissolution,
conveyance or offering which is the subject of the notice and the exercise of
this Warrant shall not be deemed to have occurred until immediately prior to the
closing of such transaction.
5. FURTHER ASSURANCES. The Company will take all action that may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable shares of stock, free from all taxes, liens and
charges with respect to the issue thereof, on the exercise of all or any portion
of this Warrant from time to time outstanding.
6. NOTICES OF RECORD DATE, ETC. In the event of:
(a) any taking by the Company of a record of the holders of any class
of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend on, or any right to subscribe for,
purchase or otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other right, or
(b) any capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company or any transfer of all
or substantially all of the assets of the Company to or the sale,
consolidation or merger of the Company with, to or into any other person,
or
(c) Any voluntary or involuntary dissolution, liquidation or
winding-up of the
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Company;
then and in each such event the Company will mail or cause to be mailed to the
Holder, at least fifteen (15) business days prior to such record date, a notice
specifying (i) the date on which any such record is to be taken for the purpose
of such dividend, distribution or right, and stating the amount and character
of such dividend, distribution or right, (ii) the date on which any such
reorganization, reclassification, recapitalization, transfer, consolidation,
merger, dissolution, liquidation or winding up is to take place, and the time,
if any is to be fixed, as of which the holders of record of Common Stock (or
Other Securities) shall be entitled to exchange their shares of Common Stock
(or Other Securities) for securities or other property deliverable on
such reorganization, reclassification, recapitalization, transfer,
consolidation, merger, dissolution, liquidation or winding-up, and (iii) the
amount and character of any stock or other securities, or rights or options
with respect thereto, proposed to be issued or granted, the date of such
proposed issue or grant and the persons or class of persons to whom such
proposed issue or grant is to be offered or made. Such notice shall also state
that the action in question or the record date is subject to the effectiveness
of a registration statement under the Securities Act or a favorable vote of
stockholders if either is required. Such notice shall be mailed at least
fifteen (15) business days prior to the date specified in such notice on which
any such action is to be taken or the record date, whichever is earlier. The
Holder shall use its best efforts to decide whether to exercise this Warrant
within ten (10) days of its receipt of such notice.
7. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS. The
Company will at all times reserve and keep available out of its authorized but
unissued shares of capital stock, solely for issuance and delivery on the
exercise of this Warrant, a sufficient number of shares of Common Stock (or
Other Securities) to effect the full exercise of this Warrant and the exercise,
conversion or exchange of any other warrant or security of the Company
exercisable for, convertible into, exchangeable for or otherwise entitling the
Holder to acquire shares of Common Stock (or Other Securities), and if at any
time the number of authorized but unissued shares of Common Stock (or Other
Securities) shall not be sufficient to effect such exercise, conversion or
exchange, the Company shall take such action as may be necessary to increase
its authorized but unissued shares of Common Stock (or Other Securities) to
such number as shall be sufficient for such purposes.
8. TRANSFER OF WARRANT. This Warrant cannot be transferred without the
prior written consent of the Company, which consent shall not be unreasonably
withheld; provided. However, the Holder may transfer this Warrant to any of its
affiliates without such consent so long as such transfer complies with all
applicable securities laws.
9. NO RIGHTS AS A STOCKHOLDER. This Warrant shall not entitle the Holder
hereof to any voting rights or other rights as a stockholder of the Company.
10. NOTICES, ETC. All notices which are required to be given pursuant to
this Warrant
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shall be in writing and shall be delivered by certified mail, return receipt
requested, first class postage prepaid, or sent by overnight express or
similarly recognized overnight delivery with receipt acknowledged or by
facsimile, with a copy thereof sent by one of the other means. Notices shall be
deemed to have been given at the time delivered and shall be addressed as
follows or to such other address as a party may designate by proper notice
hereunder.
If to Holder: To the address set forth on the
first page hereof.
If to the Company: Vsource, Inc.
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Attn.: CFO
11. SECURITIES LAWS. By acceptance of this Warrant, the Holder represents
to the Company that the Holder is "accredited investor" within the meaning of
Rule 501 of Regulation D adopted under the Securities Act, as presently in
effect, or not a "U.S. person" within the meaning of Rule 902 adopted under the
Securities Act and is acquiring the Securities in an "offshore transaction" as
defined in Rule 902, that this Warrant is being acquired for the Holder's own
account and for the purpose of investment and not with a view to, or for sale in
connection with, the distribution thereof, nor with any present intention of
distributing or selling the Warrant or the Common Stock issuable upon exercise
of the Warrant, and that it is an investor in securities of companies in the
development stage and acknowledges that it can bear the economic risk of its
investment and has such knowledge and experience in financial or business
matters that it is capable of evaluating the merits and risks of the investment
in the shares subject to this Warrant. The Holder acknowledges and agrees that
this Warrant and the Common Stock issuable upon exercise of this Warrant (if
any) have not been (and at the time of acquisition by the Holder, will not have
been or will not be) registered under the Securities Act or under the securities
laws of any state, in reliance upon certain exemptive provisions of such
statutes. The Holder further recognizes and acknowledges that because this
Warrant and the Common Stock issuable upon exercise of this Warrant are
unregistered, they may not be eligible for resale, and may only be resold in the
future pursuant to an effective registration statement under the Securities Act
and any applicable state securities laws, or pursuant to a valid exemption from
such registration requirements and that the Holder must, therefore, bear the
economic risk of such investment indefinitely.
12. LEGEND. Unless theretofore registered for resale under the Securities
Act, each certificate for shares issued upon exercise of this Warrant shall bear
the following or a similar legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
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BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
APPLICABLE STATE SECURITIES LAWS. THE SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE RESOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY
THAT SUCH DISPOSITION IS IN COMPLIANCE WITH THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS.
13. MISCELLANEOUS. This Warrant and any terms hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. This Warrant shall be construed and enforced in accordance with and
governed by the internal laws of the State of California, without regard to
conflict of laws principles. The headings in this Warrant are for purposes of
reference only, and shall not limit or otherwise affect any of the terms hereof.
The invalidity or unenforceability of any provision hereof shall in no way
affect the validity or enforceability of any other provision.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed on
its behalf by one of its officers thereunto duly authorized as of July 12, 2001.
VSOURCE, INC.
By: [SIGNATURE]
-------------------------------
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FORM OF SUBSCRIPTION
VSOURCE, INC.
(To be signed only on exercise of Warrant)
TO: VSOURCE, INC.
1. The undersigned Holder of the attached original, executed Warrant
hereby elects to exercise its purchase right under such Warrant with respect to
shares of Common Stock, as defined in the Warrant, of Vsource, Inc., a Delaware
corporation (the "Company").
2. The undersigned Holder is hereby paying the aggregate purchase price
for such shares of Common Stock (the "Exercise Shares") (i) by the enclosed
certified or official bank check payable in United States dollars to the order
of the Company in the amount of $ , or (ii) by wire transfer of United
States funds to the account of the Company in the amount of $ , which
transfer has been made before or simultaneously with the delivery of this Form
of Subscription pursuant to the instructions of the Company, or (iii) electing
to exercise the attached Warrant for shares purchasable under the
Warrant pursuant to the net exercise provisions of Section 1(b) of such Warrant.
3. Please issue a stock certificate or certificates representing the
appropriate number of shares of Common Stock in the name of the undersigned
Holder.
Dated:
-----------------------------------
Signature of Holder
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