EXHIBIT 10.20
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY
NOT BE TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS IT HAS BEEN REGISTERED UNDER
THAT ACT OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE.
THIS SECURITY IS SUBJECT TO RESTRICTIONS ON TRANSFER AND MAY NOT BE SOLD,
EXCHANGED, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT IN
ACCORDANCE WITH AND SUBJECT TO ALL THE TERMS AND CONDITIONS OF A CERTAIN
STOCKHOLDERS AGREEMENT DATED AS OF MARCH 12,1999, A COPY OF WHICH THE COMPANY
WILL FURNISH TO THE HOLDER OF THIS SECURITY UPON REQUEST AND WITHOUT CHARGE.
Right to Purchase
52,541 Shares
of Series B Convertible Preferred
Stock of Arctic, Inc.
No. B-4
ARCTIC, INC.
SERIES B CONVERTIBLE PREFERRED STOCK PURCHASE WARRANT
Arctic, Inc., a Delaware corporation (the "Company"), hereby certifies that, for
value received, Battery Investment Partners IV, LLC (the "Holder"), or its
successors or registered assigns, is entitled, subject to the terms set forth
below, to purchase -from the Company at any time or from time to time before
5:00 p.m., Boston, Massachusetts time, on the Expiration Date (as hereinafter
defined), Fifty-Two Thousand Five Hundred Forty-One fully paid and nonassessable
shares of Series B Convertible Preferred Stock, par value $.O1 per share, of the
Company (the "Preferred Stocks"), at a purchase price per share of $1.82 (the
"Purchase Price"). The number of such shares of Preferred Stock and the Purchase
Price are subject to adjustment as provided in this Wan-ant.
This Warrant is issued pursuant to a certain Preferred Stock and Preferred Stock
Warrant Purchase Agreement (the "Agreement"), dated as of February 25,
1999, by and among the Company and the persons named therein, a copy of which is
on file at the principal office of the Company and the holder of this Warrant
shall be entitled to the benefits of the Agreement, as provided therein. This
Warrant is one of several warrants (the "Purchaser Warrants') representing the
right to purchase up to an aggregate of 7,005,495 shares of Series B Convertible
Preferred Stock issuable pursuant to the Agreement.
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
Series B Convertible Preferred Stock Purchase Warrant -- Page 2
(a) The term "Company " shall include Arctic, Inc., a Delaware
corporation, and any corporation that shall succeed to or assume the obligations
of Arctic, Inc. hereunder.
(b) The term "Expiration Date" refers to the earlier of March 12, 2004 or
the date on which the Company consummates an "Initial Public Offering" (as
defined in, Section 50 of the Company's Certificate of Designations filed with
the Secretary of State of the State of Delaware on February 26, 1999 (the
"Certificate of Designations")).
(c) The term "Stockholders Agreement 'shall mean that certain
Stockholders Agreement of the Company dated March 12, 1999, and attached to the
Agreement as EXHIBIT 2.03F.
1. (a) EXERCISE OF WARRANT. This Warrant may be exercised in full or in
part at an), time or from time to time until the Expiration Date by the holder
hereof by surrender of this Warrant and the subscription form annexed hereto
(duly executed) by such holder, to the Company at its principal office,
accompanied by payment, in cash or by certified or official bank check payable
to the order of the Company in the amount obtained by multiplying (a) the number
of shares of Preferred Stock designated by the holder in the subscription form
by (b) the Purchase Price then in effect (or in accordance with the provisions
of Section I(b) below). On any partial exercise, the Company at its expense will
forthwith issue and deliver to or upon the order of the holder hereof a new
Warrant or Warrants of like tenor, in the name of the holder hereof or as such
holder (upon payment by such holder of any applicable transfer taxes and subject
to applicable securities laws) may request, providing in the aggregate on the
face or faces thereof for the number of shares of Preferred Stock for which such
Warrant or Warrants may still be exercised.
(b) NET ISSUE ELECTION. The Holder may elect to. receive, without the
payment by the Holder of any additional consideration, shares equal to the value
of this Warrant or any portion hereof by the surrender of this Warrant or such
portion to the Company, with the net issue election notice annexed hereto duly
executed, at the office of the Company. Thereupon, the Company shall issue to
the Holder such number of fully paid and nonassessable shares of Preferred Stock
as is computed using the following formula:
X = Y (A-B)
-------
A
where X = the number of shares to be issued to the Holder pursuant to this
Section I (b).
Y = the number of shares covered by this Warrant in respect of which
the net issue election is made pursuant to this Section I (b).
A = the Fair Market Value (as hereinafter defined) of one share of
Series B Preferred Stock, as at the time the net issue election is
made pursuant to this Section I (b).
B = the Purchase Price in effect under this Warrant at the time the net
issue election is made pursuant to this Section I (b).
Series B Convertible Preferred Stock Purchase Warrant -- Page 3
The Board shall promptly respond in writing to an inquiry by the Holder as to
the fair market value of one share of Series B Preferred Stock.
2. DELIVER, OF STOCK CERTIFICATES. etc., on Exercise. As soon as
practicable after the exercise of this Warrant, and in any event within 10 days
thereafter, the Company at its expense (including the payment by it of any
applicable issue or stamp taxes) will cause to be issued in the name of and
delivered to the holder hereof, or as such holder (upon payment by such holder
of any applicable transfer taxes and subject to applicable securities laws) may
direct, a certificate or certificates for the number of fully paid and
nonassessable shares of Preferred Stock to which such holder shall be entitled
on such exercise, in such denominations as may be requested by such holder,
plus, in lieu of any fractional share to which such holder would otherwise be
entitled, cash equal to such fraction multiplied by the then current market
value (as determined in good faith by the Board of Directors) of one full share,
together with any other stock or other securities and property (including cash,
where applicable) to which such holder is entitled upon such exercise pursuant
to Section I or otherwise.
3. COVENANTS AS TO PREFERRED STOCK AND COMMON STOCK. The Company
covenants and agrees that all shares of Preferred Stock which may be issued upon
the exercise of this Warrant, and all shares of Common Stock, par value $.01 per
share (the "Common Stock"), of the Company, which may be issued upon the
conversion of the Preferred Stock, will, upon issuance, be validly issued, fully
paid and non-assessable and free from all taxes, liens and charges with respect
to the issue thereof. Without limiting the generality of the foregoing, the
Company covenants that it will from time to time take all such actions as may be
requisite to assure that the stated or par value per share of Preferred Stock is
at all times equal to or less than the then effective Purchase Price per share
of Preferred Stock issuable upon exercise of this Warrant. The Company further
covenants and agrees that the Company will at all times have authorized and
reserved, free from preemptive rights, a sufficient number of shares of its
Preferred Stock to provide for the exercise of this Warrant and shares of Common
Stock to provide for the conversion of the Preferred Stock. If and so long as
the Preferred Stock issuable, upon the exercise of this Warrant or the Common
Stock issuable upon conversion of the Preferred Stock is listed on any national
securities exchange, the Company will, if permitted by the rules of such
exchange, list and keep listed on such exchange, upon official notice of
issuance, all such shares of capital stock that are so listed.
4. NO AMENDMENT OF CERTIFICATE OF INCORPORATION, ETC. The Company -shall
not, without the written consent of the holders of at least a majority in
interest of the Purchaser Warrants, (i) amend, alter or repeal the provisions of
the Certificate of Designations as in existence on the date hereof, insofar as
they relate to the rights, preferences and privileges of the Preferred Stock, or
(ii) authorize or effect any stock dividend payable in shares of Preferred Stock
or any other class or series of preferred stock of the Company or any
subdivision, split-up or combination of any outstanding shares of Preferred
-Stock or any other class or series of preferred stock of the Company.
5. NO STOCKHOLDER RIGHTS . This Warrant shall not entitle the holder
hereof to any voting -rights or other rights as a stockholder of the Company.
Series B Convertible Preferred Stock Purchase Warrant -- Page 4
6. RESTRICTIONS ON TRANSFER. RIGHTS UNDER PURCHASE AGREEMENT; Etc. The
holder of this Warrant by acceptance hereof agrees that the transfer of this
Warrant, the shares of Preferred Stock issuable upon the exercise of all or any
portion of this Warrant and the shares of Common Stock issuable upon conversion
of such shares of Preferred Stock are subject to the provisions of the
Agreement, the Stockholders Agreement and this Warrant, the shares of Preferred
Stock issuable upon exercise of all or any portion of this Warrant, and the
shares of Common Stock issuable upon conversion of such shares of Preferred
Stock shall be entitled to all rights and benefits accorded thereto in the
Agreement and the Stockholders Agreement, and the applicable provisions of the
Agreement and the Stockholders Agreement are hereby incorporated herein by
reference.
7. TRANSFER OF WARRANT. Subject to the provisions of the Stockholders
Agreement and subject to applicable securities laws, this Warrant and all rights
hereunder are transferable, in whole or in part, at the agency or office of the
Company referred to in Section 1, by the holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant properly endorsed. Subject
to the provisions of the Stockholders Agreement and sub . etc to applicable
securities laws, each taker and holder of this Warrant, by taking or holding the
same, consents and agrees that this Warrant, when endorsed, in blank, shall be
deemed negotiable, and, when so endorsed the holder hereof may be treated -by
the Company and all other persons dealing with this Warrant as the absolute
owner hereof for any purposes and as the person entitled to exercise the rights
represented by this Wan-ant, or to the transfer hereof on the books of the
Company, any notice to the contrary notwithstanding; but until each transfer on
such books, the Company may treat the registered holder hereof as the owner
hereof for all purposes.
8. REORGANIZATIONS, Etc. In case of any capital reorganization, of any
reclassification of the stock of the Company (other than a change in par value
or from par value to no par value or from no par value to -par value or as a
result of a stock dividend or subdivision, split-up or combination of shares),
or the consolidation or merger of the Company with or into another corporation
(other than a consolidation or merger in which the Company is the continuing
corporation and which does not result in any change in the Preferred Stock) or
of the sale of all or substantially all the properties and assets of the Company
as an entirety to any other corporation, this Warrant shall, after such
reorganization, reclassification, consolidation, merger or sale, be exercisable
for the kind and number of shares of stock or other securities or property of
the Company or of the corporation resulting from such consolidation or surviving
such merger or to which such properties and assets shall have been sold or of
such other person to which such holder would have been entitled if he had held
the Preferred Stock issuable upon the exercise hereof immediately prior to such
reorganization, reclassification, consolidation, merger or sale.
9. EXCHANGE OF WAN-ANT. This Warrant is exchangeable upon the surrender
hereof by the holders hereof at the office or agency of the Company designated
in Section I hereof, for new Warrants of like tenor representing in the
aggregate the rights to subscribe for and purchase the number of shares which
may be subscribed for and purchased hereunder, each of such new Warrants to
represent the right to subscribe for and purchase such number of shares as shall
be designated by said holders hereof at the time of such surrender.
Series B Convertible Preferred Stock Purchase Warrant -- Page 5
10. LOST. STOLEN. MUTILATED OR DESTROYED WARRANT - If this Wan-ant is
lost, stolen, mutilated or destroyed, the Company may, on such terms as to
indemnity or otherwise as it may in its discretion impose (which shall, in the
case of a mutilated Warrant, include the surrender thereof), issue a new Warrant
of like denomination and tenor as the Warrant so lost, stolen, mutilated or
destroyed. Any such new Warrant shall constitute a contractual obligation of the
Company, whether or not the allegedly lost, stolen, mutilated or destroyed
Warrant shall be at any time enforceable by anyone.
11. MISCELLANEOUS. This Warrant and any term 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 governed by and construed in accordance with
the General Corporation Law of the State of Delaware as to matters within the
scope thereof, and as to all other matters shall be governed by, and construed
in accordance with, the internal laws of the State of Connecticut. The headings
in this Warrant are for purposes of reference only, and shall not limit or
otherwise affect any of the terms hereof. This Warrant is being executed as an
instrument under seat. The invalidity or unenforceability of any provision
hereof shall in no way affect the validity or enforceability of any other
provision.
12. NOTICE PRIOR TO PUBLIC OFFERING. The Company shall give each Holder
at least twenty (20) days prior written notice of the effectiveness of any
registration statement filed with the Securities and Exchange Commission under
the Securities Act of 1933, as amended.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
Series B Convertible Preferred Stock Purchase Warrant -- Page 6
IN WITNESS WHEREOF, this Warrant has been executed this 9th day of April, 1999.
ARCTIC, INC.
By: /s/ XXXX XXXXXXX
[Corporate Seal] ----------------------------
Title: ________________________
Attest: _______________________
By: _________________________
Title: ________________________
FORM OF SUBSCRIPTION
(To be signed only on exercise of Warrant)
TO ARCTIC. INC.
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise this Warrant for. and to purchase thereunder,
_________________ shares of Series B Convertible Preferred Stock of ARCTIC, INC.
and herewith makes payment of $________________________ therefor in cash, or
elects to surrender the right to purchase ____shares of Series B Convertible
Preferred Stock pursuant to Section I (b) of this Warrant, and requests that the
certificates for such shares be issued in the name of, and delivered to
_______________________________________ whose address is
_________________________________________________________________.
Dated: _____________________ ________________________________
(Signature must conform to name
of holder as specified on the
face of the Warrant)
________________________________
________________________________
(Address)
FORM OF ASSIGNMENT
(To be signed only on transfer of Warrant)
For value received, the undersigned hereby sells, assigns, and transfers unto
_______________________ the right represented by the within Warrant to purchase
____ shares of Series B Convertible Preferred Stock of ARCTIC, INC. to which the
within Warrant relates, and appoints ______________as its Attorney to transfer
such right on the books of ARCTIC, INC. with full power of substitution in the
premises.
Dated: ________________________ ________________________________
(Signature must conform to name
of holder as specified on the
face of the Warrant)
Signed in the presence of
________________________________
