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EXHIBIT 4.2
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. THEY
MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A
REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS
NOT REQUIRED.
Issued: December 29, 1995 CS-1
ACCELGRAPHICS, INC.
WARRANT TO PURCHASE
35,000 SHARES OF
COMMON STOCK
1. Number and Price of Shares Subject to Warrant.
(a) Warrant Purchase Agreement. This Common Stock Warrant is
executed and delivered by AccelGraphics, Inc., a California corporation (the
"COMPANY") pursuant to that certain Warrant Purchase Agreement dated as of
December 29, 1995 (the "AGREEMENT"), executed and delivered by the Company and
Intel Corporation (the "PURCHASER"). All provisions of the Agreement applicable
hereto are incorporated herein by reference.
(b) Term. Subject to the terms and conditions herein set
forth, at Purchaser's option, the Purchaser is entitled to purchase from the
Company at any time after the date of this Warrant and on or before the earlier
of (i) December 29, 1998, or (ii) the closing of a transaction or series of
transactions involving the Company's sale of all or substantially all of its
assets or the acquisition of the Company by another entity by means of merger or
other transaction as a result of which shareholders of the Company immediately
prior to such acquisition possess a minority of the voting power of the
surviving entity immediately following such acquisition (a "MERGER"), or (iii)
the closing of the initial public offering of the Company's Common Stock
registered under the Securities Act of 1933, as amended (the "1933 ACT"), up to
35,000 shares (which number of shares is subject to adjustment as described
below) of fully paid and nonassessable Common Stock of the Company.
(c) Warrant Price. Subject to adjustment as hereinafter
provided, the purchase price of one share of Common Stock shall be equal to
$2.25 per share. The purchase price of one share of Common Stock (or such
securities as may be substituted for one share of Common Stock pursuant to the
provisions hereinafter set forth) payable from time to time upon the exercise of
this Warrant (whether such price be the price specified above or an adjusted
price determined as hereinafter provided) is referred to herein as the "WARRANT
PRICE."
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2. Adjustment of Warrant Price and Number of Shares. The number and
kind of securities issuable upon the exercise of this Warrant shall be subject
to adjustment from time to time upon the happening of certain events as follows:
(a) Adjustment for Dividends in Stock or Other Securities or
Property. In case at any time or from time to time on or after the date hereof
the holders of the Common Stock of the Company (or any shares of stock or other
securities at the time receivable upon the exercise of this Warrant) shall have
received, or, on or after the record date fixed for the determination of
eligible shareholders, shall have become entitled to receive, without payment
therefor, other or additional stock or other securities or property (other than
cash) of the Company by way of dividend, then and in each case, the holder of
this Warrant shall, upon the exercise hereof, be entitled to receive, in
addition to the number of shares of Common Stock receivable thereupon, and
without payment of any additional consideration therefor, the amount of such
other or additional stock or other securities or property (other than cash) of
the Company which such holder would hold on the date of such exercise had it
been the holder of record of such Common Stock on the date hereof and had
thereafter, during the period from the date hereof to and including the date of
such exercise, retained such shares and/or all other additional stock available
by it as aforesaid during such period, giving effect to all adjustments called
for during such period by paragraphs (b) and (c) of this Section 2.
(b) Adjustment for Reclassification, Reorganization or Merger.
In case of any reclassification or change of the outstanding securities of the
Company or of any reorganization of the Company (or any other corporation the
stock or securities of which are at the time receivable upon the exercise of
this Warrant) or any similar corporate reorganization on or after the date
hereof, then and in each such case the holder of this Warrant, upon the exercise
hereof at any time after the consummation of such reclassification, change,
reorganization, merger or conveyance, shall be entitled to receive, in lieu of
the stock or other securities and property receivable upon the exercise hereof
prior to such consummation, the stock or other securities or property to which
such holder would have been entitled upon such consummation if such holder had
exercised this Warrant immediately prior thereto, all subject to further
adjustment as provided in paragraphs (a) and (c) of this Section 2; and in each
such case, the terms of this Section 2 shall be applicable to the shares of
stock or other securities properly receivable upon the exercise of this Warrant
after such consummation.
(c) Stock Splits and Reverse Stock Splits. If at any time on
or after the date hereof the Company shall subdivide its outstanding shares of
Common Stock into a greater number of shares, the Warrant Price in effect
immediately prior to such subdivision shall thereby be proportionately reduced
and the number of shares receivable upon exercise of the Warrant shall thereby
be proportionately increased; and, conversely, if at any time on or after the
date hereof the outstanding number of shares of Common Stock shall be combined
into a smaller number of shares, the Warrant Price in effect immediately prior
to such combination shall thereby be proportionately increased and the number of
shares receivable upon exercise of this Warrant shall thereby be proportionately
decreased.
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3. No Fractional Shares. No fractional shares of Common Stock will be
issued in connection with any exercise hereunder. In lieu of any fractional
shares which would otherwise be issuable, the Company shall pay cash equal to
the product of such fraction multiplied by the Fair Market Value (as defined
below) of one share of Common Stock on the date of exercise.
4. No Shareholder Rights. This Warrant represents only the right to
purchase shares of Common Stock of the Company and shall not otherwise entitle
its holder to any of the rights of a shareholder of the Company unless and until
it is exercised in accordance with the terms hereof.
5. Exercise of Warrant.
(a) Method of Exercise. This Warrant may be exercised by the
holder hereof, in whole or in part and from time to time, by the surrender of
this Warrant at the principal office of the Company, accompanied by the
completed and executed Notice of Exercise (attached hereto as Exhibit A) and
payment of the Warrant Price. The Warrant Price may be paid (i) by check, of an
amount equal to the then applicable Warrant Price per share multiplied by the
number of shares of Common Stock then being purchased, (ii) by cancellation of
any present or future indebtedness from the Company to the holder hereof in an
amount equal to the then applicable Warrant Price per share multiplied by the
number of shares of Common Stock then being purchased, or (iii) pursuant to the
net exercise provisions set forth in Section 5(b) below. This Warrant shall be
deemed to have been exercised immediately prior to the close of business on the
date of its surrender for exercise as provided above, and the person entitled to
receive the shares of Common Stock issuable upon such exercise shall be treated
for all purposes as the holder of such shares of record as of the close of
business on such date. As promptly as practicable on or after such date and in
any event within five (5) business days thereafter, the Company at its expense
shall issue and deliver to the person or persons entitled to receive the same a
certificate or certificates for the number of full shares of Common Stock
issuable upon such exercise, together with cash in lieu of any fraction of a
share as provided above, and, unless this Warrant has been fully exercised or
has expired, a new Warrant representing the portion of the shares of Common
Stock, if any, with respect to which this Warrant shall not have been exercised,
shall also be issued to the holder hereof.
(b) Net Issue Exercise.
(i) In lieu of exercising this Warrant in the manner
provided above in Section 5(a), the holder hereof may elect to receive shares
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 Notice of Exercise (attached hereto as Exhibit A) in which event the Company
shall issue to holder a number of shares of the Company's Common Stock computed
using the following formula:
X = Y (A - B)
---------
A
Where: X = The number of shares of Common Stock to be issued to holder.
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Y = The number of shares of Common Stock purchasable
under this Warrant (at the date of such calculation).
A = The Fair Market Value (as defined below) of one
share of the Company's Common Stock (at the date of
such calculation).
B = The Warrant Price (as adjusted to the date of
such calculation).
(ii) For purposes of this Section 5(b), the term
"FAIR MARKET VALUE" means the value of the Company's Common Stock on the
pertinent date, determined as follows:
(a) If the Common Stock of the Company is
traded on a stock exchange on such date, then the Fair Market Value will be
equal to the average of the closing price reported by the applicable
composite-transactions report for the 20 trading days prior to such date;
(b) If the Common Stock of the Company is
traded on the Nasdaq National Market, then the Fair Market Value will be equal
to the average of the last-transaction price quoted by the Nasdaq National
Market for the 20 trading days prior to such date;
(c) If the exercise of this Warrant is to be
effective as of the closing of the Company's initial public offering of its
Common Stock pursuant to a registration statement filed pursuant to the 1933
Act, then the Fair Market Value will be equal to the "price to public" specified
for such stock in the final prospectus for such public offering;
(d) If the exercise of this Warrant is to be
effective as of the closing of a Merger, then the Fair Market Value will be an
amount consistent with the value of the Common Stock implied by such transaction
or transactions; and
(e) If none of the foregoing provisions is
applicable, then the Fair Market Value will be determined by the Board of
Directors of the Company in good faith on such basis as it deems appropriate.
6. Certificate of Adjustment. Whenever the Warrant Price or number or
type of securities issuable upon exercise of this Warrant is adjusted, as herein
provided, the Company shall promptly deliver to the record holder of this
Warrant a certificate of an officer of the Company setting forth the nature of
such adjustment and a brief statement of the facts requiring such adjustment.
7. Transfer of Warrant. This Warrant may not be transferred by the
Purchaser without the written consent of the Company.
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8. Replacement of Warrants. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of any
Warrant and, in the case of any such loss, theft or destruction of any Warrant,
on delivery of an indemnity agreement or security reasonably satisfactory in
form and amount to the Company or, in the case of any such mutilation, on
surrender and cancellation of such Warrant, the Company at its expense will
execute and deliver, in lieu thereof, a new Warrant of like tenor.
9. Registration Rights. The Purchaser shall have the registration
rights contained in the Amended and Restated Rights Agreement dated June 20,
1995 between the Company and certain shareholders of the Company, as set forth
on Exhibit A thereto.
10. Miscellaneous. This Warrant shall be governed by the laws of the
State of California. The headings in this Warrant are for purposes of
convenience and reference only, and shall not be deemed to constitute a part
hereof. This Warrant may be changed, waived, discharged or terminated only by an
instrument in writing signed by the Company and the registered holder hereof.
All notices and other communications from the Company to the holder of this
Warrant shall be mailed by first class registered or certified mail, postage
prepaid, to the address furnished to the Company in writing by the last holder
of this Warrant who shall have furnished an address to the Company in writing.
The invalidity or unenforceability of any provision hereof shall in no way
affect the validity or enforceability of any other provisions.
11. Attorney's Fees. If any action at law or in equity (including
arbitration) is necessary to enforce or interpret the terms of this Warrant, the
prevailing party shall be entitled to reasonable attorney's fees, costs and
necessary disbursements in addition to any other relief to which such party may
be entitled.
12. Notice. The Company shall give Purchaser written notice of any
sale, merger, consolidation or public offering referred to in Section 1(b) or
any cash dividend declared on the Company's Common Stock at least twenty (20)
days prior to the closing of any such sale, merger, consolidation or public
offering or the record date fixed for the determination of shareholders eligible
for such dividend and shall deliver a copy of the preliminary prospectus with
respect to any such public offering to Purchaser promptly after it becomes
available.
This Common Stock Warrant is issued as of the 29th day of December,
1995.
ACCELGRAPHICS, INC.
By: /s/ Xxxxx X. Xxxx
______________________________
Xxxxx X. Xxxx, Chief Financial
Officer and Vice President,
Operations
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EXHIBIT A
NOTICE OF EXERCISE
To: Secretary of AccelGraphics, Inc.
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. ___) hereby irrevocably elects to purchase ________ shares of the
Common Stock of AccelGraphics, Inc. covered by such Warrant. The undersigned
herewith makes payment of $____________, representing the full purchase price
for such shares at the price per share provided for in such Warrant. Such
payment takes the form of (check applicable box or boxes):
\ \ a check for $_______ in lawful money of the United States;
\ \ cancellation of $________ of indebtedness from the Company to
the undersigned; or
\ \ the cancellation of such portion of the attached Warrant as is
exercisable for a total of ________ Warrant Shares (using a
Fair Market Value of $_________ per share for purposes of this
calculation).
Date:_________________ Signature:_____________
Address:_____________
_____________
_____________
