EXHIBIT 4.4
Annex IV
to
Subscription
Agreement
VOID AFTER 5:00 P.M. NEW YORK CITY
TIME ON MARCH 21, 2005
THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER JURISDICTION. THE SECURITIES REPRESENTED HEREBY MAY NOT BE
OFFERED OR SOLD IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER APPLICABLE SECURITIES LAWS OR UNLESS OFFERED, SOLD OR
TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THOSE LAWS.
Right to Purchase [INSERT PRO RATA
PORTION OF 250,000] Common Units Of
XxxXxXxx.xxx, LLC owned by e4L, Inc.
No. BW-
Date: March 21, 2000
COMMON UNIT PURCHASE WARRANT
THIS CERTIFIES THAT, for value received, _________________ or its
registered assigns, is entitled to purchase from e4L, Inc., a corporation
organized under the laws of the State of Delaware (the "Company"), at any time
or from time to time during the period specified in Section 2 hereof, [INSERT
PRO RATA PORTION OF 250,000] common units (the "Warrant Shares") of
XxxXxXxx.xxx, LLC ("BuyItNow") at an exercise price per share (the "Exercise
Price") equal to $5.00. The number of Warrant Shares and the Exercise Price are
subject to adjustment as provided in Section 3 hereof. This Warrant is issued
pursuant to the Subscription Agreement, dated as of March 21, 2000 (the
"Subscription Agreement"), between the Company and the original holder of this
Warrant. In addition, the holder of this Warrant has certain rights as set forth
in Section 8 hereof in the event of a change of control of BuyItNow.
This Warrant is subject to the following terms, provisions, and
conditions:
1. Manner of Exercise; Issuance of Certificates; Payment for Shares.
Subject to the provisions hereof, including, without limitation, the limitations
contained in Section 4 hereof, this Warrant may be exercised by the holder
hereof, in whole or in part, by the surrender of this Warrant, together with a
completed exercise agreement in the form attached hereto (the "Exercise
Agreement"), to the Company during normal business hours on any business day at
the Company's principal executive offices (or such other office or agency of the
Company as it may designate by notice to the holder hereof), and upon payment to
the Company in cash, by certified or official bank check or by wire transfer for
the account of the Company, of the Exercise Price for the Warrant Shares
specified in the Exercise Agreement. The Warrant Shares so purchased shall be
deemed to
be sold to the holder hereof as of the close of business on the date on which
this Warrant shall have been surrendered, the completed Exercise Agreement shall
have been delivered, and payment shall have been made for such shares as set
forth above or, if such date is not a business day, on the next succeeding
business day. The Company shall use its best efforts to deliver the certificates
for the Warrant Shares so purchased within a reasonable time after this Warrant
shall have been so exercised, but in no event later than five business
thereafter. If this Warrant shall have been exercised only in part, then, unless
this Warrant has expired, the Company shall, at its expense, at the time of
delivery of such certificates, deliver to the holder a new Warrant representing
the number of shares with respect to which this Warrant shall not then have been
exercised.
2. Period of Exercise.
(a) This Warrant is exercisable, at any time or from time to time
during the period (the "Exercise Period") beginning on the Issue Date (as
defined herein), and ending at 5:00 p.m., New York City time, on March 21, 2005
(the "Expiration Date").
3. Antidilution Provision. The Exercise Price and the number of Warrant
Shares which may be purchased hereunder shall be subject to adjustment from time
to time as provided in this Section 3.
(a) Subdivision or Combination of Common Stock. If BuyItNow at any
time after the date of the initial issuance of this Warrant (the "Issue Date"),
subdivides (by any stock split, stock dividend, recapitalization,
reorganization, reclassification or otherwise) its common units into a greater
number of units, then, after the date of record for effecting such subdivision,
the Exercise Price in effect immediately prior to such subdivision will be
proportionately reduced. If BuyItNow, at any time after the Issue Date, combines
(by reverse stock split, recapitalization, reorganization, reclassification or
otherwise) its common units into a smaller number of units, then, after the date
of record for effecting such combination, the Exercise Price in effect
immediately prior to such combination will be proportionately increased.
4. Transfer and Replacement of Warrant.
(a) Restriction on Transfer. This Warrant and the rights granted to
the holder hereof are transferable, in whole or in part, upon surrender of this
Warrant, together with a properly executed assignment in the form attached
hereto, at the office or agency of the Company referred to in Section 5 below,
provided, however, that any transfer or assignment shall be subject to the
conditions set forth in Section 4(d) hereof and to the provisions of Sections
4(a) and 4(b) of the Subscription Agreement. Until due presentment for transfer
on the books of the Company, the Company may treat the registered holder hereof
as the owner and holder hereof for all purposes, and the Company shall not be
affected by any notice to the contrary.
(b) Replacement of Warrant. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction, or mutilation of
this Warrant and, in the case of any such loss, theft, or destruction, upon
delivery of an indemnity agreement reasonably satisfactory in form and amount to
the Company, or, in the case of any such mutilation, upon surrender and
cancellation of this Warrant, the Company, at its expense, will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
(c) Cancellation. Upon the surrender of this Warrant in connection
with any transfer or replacement as provided in this Section 4, this Warrant
shall be promptly canceled by the Company.
(d) Exercise or Transfer Without Registration. If, at the time of
the surrender of this Warrant in connection with any exercise, transfer, or
exchange of this Warrant, this Warrant (or, in the case of any exercise, the
Warrant Shares issuable hereunder), shall not be registered under the
-2-
Securities Act and under applicable state securities or blue sky laws, the
Company may require, as a condition of allowing such exercise, transfer, or
exchange, (i) that the holder or transferee of this Warrant, as the case may be,
furnish to the Company a written opinion of counsel (which opinion shall be in
form, substance and scope customary for opinions of counsel in comparable
transactions) to the effect that such exercise, transfer, or exchange may be
made without registration under the Securities Act and under applicable state
securities or blue sky laws, (ii) that the holder or transferee execute and
deliver to the Company an investment letter in form and substance acceptable to
the Company and (iii) that the transferee be an "accredited investor" as defined
in Rule 501(a) promulgated under the Securities Act; provided that no such
opinion, letter or status as an "accredited investor" shall be required in
connection with a transfer pursuant to Rule 144 under the Securities Act.
5. Notices. Any notices required or permitted to be given under the terms
of this Warrant shall be sent by certified or registered mail (return receipt
requested) or delivered personally or by courier or by confirmed telecopy, and
shall be effective five days after being placed in the mail, if mailed, or upon
receipt or refusal of receipt, if delivered personally or by courier, or by
confirmed telecopy, in each case addressed to a party. The addresses for such
communications shall be:
If to the Company:
e4L, Inc.
00000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxxx
with a copy to:
Klehr, Harrison, Xxxxxx, Branzburg & Xxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxxxx, III, Esquire
If to the holder, at such address as such holder shall have provided in writing
to the Company, or at such other address as such holder furnishes by notice
given in accordance with this Section 5.
6. Governing Law. This Warrant shall be governed by and construed in
accordance with the laws of the State of Delaware applicable to contracts made
and to be performed in the State of Delaware.
7. Miscellaneous.
(a) Amendments. This Warrant and any provision hereof may only be
amended by an instrument in writing signed by the Company and the holder hereof.
(b) Descriptive Headings. The descriptive headings of the several
Sections of this Warrant are inserted for purposes of reference only, and shall
not affect the meaning or construction of any of the provisions hereof.
(c) Business Day. For purposes of this Warrant, the term "business
day" means any day, other than a Saturday or Sunday or a day on which banking
institutions in the State of New York are authorized or obligated by law,
regulation or executive order to close.
-3-
8. Sale of BuyItNow.
(a) Payment by the Company. In case of any consolidation of BuyItNow
with, or merger of BuyItNow into any other corporation, or in case of any sale
or conveyance of all of the outstanding units of BuyItNow or all or
substantially all of its assets other than in connection with a plan of complete
liquidation of BuyItNow (collectively, a "Change of Control Transaction") at any
time after the Issue Date and prior to the Expiration Date, the Company shall
pay to the holder of this Warrant pursuant to and in accordance with Section
8(b), an amount of cash or other consideration (the "BuyItNow Buyout Payment")
determined in accordance with the following formula:
B = W x ( (C / N) - E)
Where:
B = The amount of the BuyItNow Buyout Payment, which payment shall
be in the same form (i.e., cash or non-cash) as the consideration
which the Company receives for its BuyItNow common units pursuant to
the Change of Control Transaction.
W = The number of Warrant Shares issuable upon exercise of this
Warrant on the date of consummation of the Change of Control
Transaction.
C = The Value (as defined below) of the consideration received by
the Company in the Change of Control Transaction.
N = The number of common units of BuyItNow held by the Company
immediately prior to the consummation of the Change of Control
Transaction.
E = The Exercise Price of this Warrant on the date of consummation
of the Change of Control Transaction.
(b) BuyItNow Buyout Payment. Within ten (10) business days after the
consummation of a Change of Control Transaction, the Company shall provide
written notice (the "Buyout Notice") to the holder of this Warrant stating that
a Change of Control Transaction has occurred, along with a calculation of the
amount of the payment (and the form of the consideration thereof) which the
holder of this Warrant may receive. If the holder of this Warrant desires to
receive such payment, such holder shall submit to the Company, within ten (10)
business days after receipt of the Buyout Notice, this Warrant and a written
notice which indicates that the holder of this Warrant desires to receive the
BuyItNow Buyout Payment. Subject to any applicable time and/or other
restrictions imposed upon the Company by the documents relating to the Change of
Control Transaction, the Company shall pay the BuyItNow Buyout Payment to the
holder of this Warrant within ten (10) business days after receipt of this
Warrant, the aforementioned notice and the receipt by the Company of the full
consideration which the Company is entitled to receive in connection with the
Change of Control Transaction.
(c) Status of Warrant. Upon tender of this Warrant in accordance
with Section 8(b), this Warrant shall be null and void and of no further force
and effect, except as to the right of the holder to receive the BuyItNow Buyout
Payment.
(d) Definitions. For purposes of this Section 8,
"Value" means (i) with respect to cash, the amount thereof and
(ii) with respect to consideration other than cash, the fair market value of
such consideration, except where
-4-
such consideration consists of securities, in which case the amount of
consideration will be the Market Price thereof as of the date of the
consummation of the Change of Control Transaction. The fair market value of any
consideration other than cash or securities will be determined in good faith by
an investment banker or other appropriate expert of national reputation selected
by the Company and reasonably acceptable to the holder hereof, with the costs of
such appraisal to be borne by the Company.
"Market Price" means the volume weighted average sale prices
on the principal trading market for a security for the trading day immediately
preceding the date of the consummation of the Change of Control Transaction, or,
if the Market Price cannot be calculated as of such date on the foregoing basis,
the Market Price shall be the fair market value as reasonably determined by an
investment banking firm selected by the Company and reasonably acceptable to the
holder hereof, with the costs of such appraisal to be borne by the Company.
9. Assignment of Registration Rights. The Company hereby assigns to the
holder of this Warrant all of its rights with respect to the registration of all
Warrant Shares for which this Warrant may be exercised (which rights are set
forth in Exhibit G to the Operating Agreement, dated as of June 7, 1999, as
amended, among XxxXxXxx.xxx L.L.C., e4L, Inc. and BuyItNow, Inc. (the "BuyItNow
Registration Rights"), a copy of which is attached hereto as Exhibit A; provided
that the holder of this Warrant assumes the Company's obligations in respect of
the Warrant Shares set forth in the BuyItNow Registration Rights.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed on
its behalf by one of its officers thereunto duly authorized.
Dated: ________________, 2000
e4L, INC.
By: __________________________________
Name:
Title:
-6-
FORM OF EXERCISE AGREEMENT
(To be Executed by the Holder in order to Exercise the Warrant)
To: e4L, Inc.
00000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxxx
The undersigned hereby irrevocably exercises the right to purchase
_____________ common units of XxxXxXxx.xxx, LLC, evidenced by the attached
Warrant, and herewith makes payment of the Exercise Price with respect to such
shares in full, all in accordance with the conditions and provisions of said
Warrant.
8. The undersigned agrees not to offer, sell, transfer or otherwise
dispose of any Common Stock obtained on exercise of the Warrant, except under
circumstances that will not result in a violation of the Securities Act of 1933,
as amended, or any state securities laws, and agrees that the following legend
may be affixed to the stock certificate for the Common Stock hereby subscribed
for if resale of such Common Stock is not registered or if Rule 144 is
unavailable:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR THE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. THE SECURITIES REPRESENTED HEREBY MAY NOT BE
OFFERED OR SOLD IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER APPLICABLE SECURITIES LAWS OR UNLESS OFFERED, SOLD OR
TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THOSE LAWS.
9. The undersigned hereby assumes the Company's obligations under the
BuyItNow Registration Rights Agreement in respect of the Warrant Shares.
(iii) The undersigned requests that stock certificates for such shares be
issued, and a Warrant representing any unexercised portion hereof be issued,
pursuant to the Warrant in the name of the Holder and delivered to the
undersigned at the address set forth below:
Dated:_________________ ____________________________________________
Signature of Holder
____________________________________________
Name of Holder (Print)
Address:____________________________________
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
all the rights of the undersigned under the within Warrant, with respect to the
number of shares of Common Stock covered thereby set forth hereinbelow, to:
Name of Assignee Address No of Shares
---------------- ------- ------------
, and hereby irrevocably constitutes and appoints ____________________________,
as agent and attorney-in-fact to transfer said Warrant on the books of the
within-named corporation, with full power of substitution in the premises.
Dated: ____________________, ____,
In the presence of
__________________________________
Name: _____________________________________
Signature: ________________________________
Title of Signing Officer or Agent (if any):
___________________________________________
Address: __________________________________
__________________________________
Note: The above signature should correspond
exactly with the name on the face of
the within Warrant.
