1
PAGE 19 OF 76 PAGES
EXHIBIT AA
WARRANT AGREEMENT
WARRANT AGREEMENT, dated as of February 12, 1996 (the
"Additional Warrant Agreement"), by and between PHOENIX INFORMATION SYSTEMS
CORP., a Delaware corporation (the "Company") S-C PHOENIX PARTNERS, a New York
general partnership ("S-C" and, together with its successors and permitted
assigns, the "Holder").
WHEREAS, the Company proposes to issue and deliver its warrant
certificates ("Warrant Certificates") evidencing 140,000 warrants (the
"Warrants") each to purchase one newly issued share of common stock, par value
$0.01 per share, of the Company ("Common Stock") in connection with that
certain Convertible Note Purchase Agreement, dated as of December 9, 1994, by
and between the Company and S-C (the "Note Purchase Agreement") and that
certain letter agreement referencing the "Additional Warrants", dated the date
hereof, by and between the Company and S-C.
NOW THEREFORE, in consideration of the foregoing and for the
purpose of defining the terms and provisions of the Warrants and the respective
rights and obligations thereunder of the Company and the Holder, the Company
and the Holder agree as follows:
1. Certain Definitions. The following terms, as used in
this Additional Warrant Agreement, have the following meanings:
2
PAGE 20 OF 76 PAGES
(a) "Affiliate" means, with respect to S-C, (A)(a) any
Person controlling, controlled by or under common control with S-C and (b) if
(1) controlling S-C, such Person has a forty percent (40%) or more voting and
beneficial ownership interest in S-C, (2) controlled by S-C has a forty percent
(40%) or more voting and beneficial ownership interest in such Person and (3)
under common control with S-C, the Person(s) having such common control have
forty percent (40%) or more voting and beneficial ownership interest in S-C and
such Person, and (B) any Person for which ▇▇▇▇▇▇ ▇▇▇▇▇ d/b/a ▇▇▇▇▇ Fund
Management or Chatterjee Fund Management Co. LP, a Delaware limited
partnership, is acting as investment manager or investment adviser, in each
case with investment discretion. For purposes of this definition, the term
"control," when used with respect to any Person, shall include the power to
exercise discretion over the investments of such Person, and the terms
"controlling" and "controlled" have corresponding meanings.
(b) "Business Day" means any day other than a Saturday,
Sunday or day on which banks in New York City are closed for general business.
(c) "Common Stock" has the meaning set forth in the
preamble.
(d) "Exercise Period" means the period beginning on the
date hereof and ending at 5 p.m. New York City time on the third anniversary of
the date on which the Company shall have satisfied the conditions contained in
clauses (a) and (b) of the
2
3
PAGE 21 OF 76 PAGES
definition of "Tranche E Target Date" set forth in the Note Purchase Agreement.
(e) "Exercise Price" means $3.23 per share (as provided
in Section 3 and subject to adjustment as provided in Section 4).
(f) "Expiration Date" for the Warrants means the last day
of the Exercise Period.
(g) "Holder" has the meaning set forth in the preamble.
(h) "Investor Representative" shall be S-C Phoenix
Holdings, L.L.C., a Delaware limited liability company and a ganeral partner of
S-C, or its successor in interest, or the assigned representative of such
Person (it being agreed that at all times there shall be no more than one
Investor Representative).
(i) "Person" means any individual, corporation, limited
liability company, partnership, limited liability company, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
(j) "Underlying Common Stock" means the shares of Common
Stock purchasable by the Holder upon the exercise of the Warrants.
(k) "Warrants" has the meaning set forth in the preamble.
(l) "Warrant Certificates" means the certificates
evidencing the Warrants.
3
4
Page 22 of 76 Pages
2. Issue of Warrants. The Warrant Certificates shall be
in registered form only and substantially in the form attached hereto as
Exhibit A, shall be dated the date on which signed by an authorized signatory
of the Company and may have such legends and endorsements typed, stamped or
printed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Additional Warrant Agreement and the Options
Agreement. Warrant Certificates evidencing 140,000 Warrants may be executed by
any authorized officer of the Company. Warrant Certificates evidencing all
140,000 Warrants shall be delivered in the name of the Holder to the Investor
Representative on the date hereof.
3. Exercise Price; Exercise of Warrants.
(a) Exercise Price. Each Warrant shall entitle
the Holder, subject to the provisions of this Additional Warrant Agreement, to
purchase one share of Common Stock at a purchase price per share equal to the
Exercise Price.
(b) Exercise of Warrants Generally.
(1) Exercise During Exercise Period.
The aggregate number of Warrants that may be exercised at any time during the
Exercise Period shall be 140,000. All Warrants not exercised during the
Exercise Period shall expire at 5 p.m. New York City time on the Expiration
Date.
(2) Liquidation Event. If the Company
is liquidated in accordance with the provisions of its Certificate of
Incorporation, then the Warrants shall be deemed to have been exercised.
5
Page 23 of 76 Pages
(3) Method of Exercise; Payment of
Exercise Price. In order to exercise any or all of the Warrants represented by
a Warrant Certificate, the Holder must surrender the Warrant Certificate to the
Company for exercise, with the reverse side of the Warrant Certificate duly
executed, together with any required payment in full of the Exercise Price for
each share of Underlying Common Stock to which the Holder is entitled, any such
payment of the Exercise Price to be made by check or wire transfer to an
account designated by the Company. If the Holder elects to exercise only a
portion of the Warrants represented by the Warrant Certificate or Certificates
registered in its name, then the remaining portion of the Warrants shall be
returned to the Holder in the form of a new Warrant Certificate. Upon
surrender of a Warrant Certificate and the payment of the Exercise Price in
conformity with the foregoing provisions, the Company shall promptly issue to
the Holder share certificates representing the Underlying Common Stock to which
the Holder is entitled, registered in the name of the Holder or the name or
names of such Affiliates of the Holder as may be directed in writing by the
Holder, and shall deliver such share certificates to the Person or Persons
entitled to receive the same. The Company shall issue such share certificates
within five Business Days after the payment of the Exercise Price of the
Warrants by the Holder, but such shares shall be deemed issued and outstanding
on the date the Warrant is exercised and the Exercise Price is paid to the
Company.
6
PAGE 24 OF 76 PAGES
(c) Exercise by Surrender of Warrant; Exercise
with Shares of Common Stock. In addition to the method of exercise set forth
in Section 3(b)(3) above and in lieu of any cash payment required thereunder,
the Holder shall have the right at any time and from time to time to exercise
the Warrants in full or in part (i) by surrendering its Warrant Certificate in
the manner specified in Section 3(b)(3) in exchange for the number of shares of
Common Stock equal to the product of (x) the number of shares as to which the
Warrants are being exercised multiplied by (y) a fraction, the numerator of
which is the Market Price (as defined hereafter) of the Common Stock less the
Exercise Price and the denominator of which is such Market Price, or (ii) by
surrendering the Warrant Certificate in the manner specified in Section 3(b)(3)
above and making any required payment in whole or in part of the Exercise Price
for each share of Underlying Common Stock to which the Holder is entitled with
shares of Common Stock (valued at the Market Price). As used herein, "Market
Price" shall mean the average of the closing prices of the Common Stock sales
on all domestic exchanges on which the Common Stock may at the time be listed,
or, if there shall have been no sales on any such exchange on any day, the
average of the highest bid and lowest asked prices on all such exchanges at the
end of such day, or, if on any day the Common Stock shall not be so listed, the
average of the representative bid and asked prices quoted in the NASDAQ System
as of 3:30 p.m. New York City time, or if on any day the Common Stock shall not
be quoted in the NASDAQ System, the average of the high and low
7
PAGE 25 OF 76 PAGES
bid and asked prices on such day in the domestic over-the-counter market as
reported by the National Quotation Bureau, Incorporation or any similar
successor organization, in each such case averaged over a period of 30
consecutive Business Days immediately prior to the date of exercise; provided
that if the Common Stock is listed on any domestic exchange the term "Business
Days" as used in this sentence shall mean business days on which such exchange
is open for trading. If at any time the Common Stock is not listed on any
domestic exchange or quoted in the NASDAQ System or the domestic
over-the-counter market, the Market Price shall be deemed to be the fair market
value thereof as of the date of exercise, determined by an independent
appraiser selected by the Company and acceptable to the Holder.
4. Adjustments. The Exercise Price shall be subject to
adjustment as follows:
(a) In the event the Company shall issue
additional shares of Common Stock (or securities convertible into or
exchangeable for Common Stock) in a stock dividend, stock distribution or
subdivision paid with respect to Common Stock, or declare any dividend or other
distribution payable with additional shares of Common Stock (or securities
convertible into or exchangeable for Common Stock) with respect to Common Stock
or effect a split or subdivision of the outstanding shares of Common Stock, the
Exercise Price shall, concurrently with the effectiveness of such stock
dividend, stock distribution or subdivision, or the earlier declaration
thereof, be proportionately decreased, and the number of Underlying Common
8
PAGE 26 OF 76 PAGES
Stock shall be proportionately adjusted so that, to avoid dilution of the
Holder's position, the Holder shall thereafter be entitled to receive at such
adjusted price an additional number of shares of the Company's Common Stock
which such Holder would have owned or would have been entitled to receive upon
or by reason of any of the events described above, had the Warrants been
exercised immediately prior to the happening of such event.
(b) In the event the outstanding shares of Common
Stock shall be combined or consolidated, by reclassification or otherwise, into
a lesser number of shares of Common Stock, the Exercise Price shall,
concurrently with the effectiveness of such combination or consolidation, be
proportionately increased and the number of Underlying Common Stock shall be
proportionately adjusted so that the Holder of any Warrant exercised after such
date shall be entitled to receive, upon payment of the same aggregate amount as
would have been payable before such date, the aggregate number of shares of
Common Stock which the Holder would have owned upon such exercise and been
entitled to receive, if such Warrant had been exercised immediately prior to
the happening of such combination or consolidation.
(c) In the event of any consolidation or merger
of the Company with or into another corporation or the conveyance of all or
substantially all of the assets of the Company to another corporation or
entity, the Warrants shall thereafter be exercisable for the number of shares
of capital stock or other securities or property to which a holder of the
number of shares of Common Stock deliverable upon conversion hereof would have
9
PAGE 27 OF 76 PAGES
been entitled upon such consolidation, merger or conveyance; and, in any such
case, appropriate adjustment shall be made in the application of the provisions
herein set forth with respect to the rights and interests of the Holder
thereafter, to the end that the provisions set forth herein (including
provisions with respect to adjustments in the Exercise Price) shall thereafter
be applicable, as nearly as may be practicable, in relation to any shares of
stock or other property thereafter deliverable upon the exercise of Warrants.
At the request of the Holder, the resulting or surviving entity in any such
consolidation or merger, if other than the Company, shall acknowledge in
writing the Holder's rights hereunder.
5. Loss or Mutilation. Upon receipt by the Company of
evidence satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Warrant Certificate and of indemnity
satisfactory to it, and (in the case of mutilation) upon surrender and
cancellation thereof, then, in the absence of notice to the Company that the
Warrants represented thereby have been acquired by a bona fide purchaser, the
Company shall deliver to the Holder, in exchange for or in lieu of the lost,
stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate
of the same tenor and for a like aggregate number of Warrants. Upon the
issuance of any new Warrant Certificate under this Section 5, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and other expenses in connection
herewith. Every new Warrant Certificate executed and delivered
10
PAGE 28 OF 76 PAGES
pursuant to this Section 5 in lieu of any lost, stolen or destroyed Warrant
Certificate shall constitute a contractual obligation of the Company, whether
or not the allegedly lost, stolen or destroyed Warrant Certificate shall be at
any time enforceable by anyone, and shall be entitled to the benefit of this
Additional Warrant Agreement equally and proportionately with any and all other
Warrant Certificates duly executed and delivered hereunder. The provisions of
this Section 5 are exclusive and shall preclude (to the extent lawful) all
other rights or remedies with respect to the replacement of mutilated, lost,
stolen, or destroyed Warrant Certificates.
6. Reservation and Authorization of Common Stock. The
Company shall, at all times until the Warrants have been exercised or have
expired, reserve and keep available for issue upon the exercise of Warrants
such number of its authorized but unissued shares of Common Stock as is
sufficient for the purpose of permitting the exercise in full of all
outstanding Warrants.
7. Limitations on Transfer; Warrant Transfer Books. The
Warrants may be sold, transferred, pledged, assigned, hypothecated or otherwise
disposed of (collectively, "transferred") only to Affiliates of the Holder.
The Company shall cause to be kept at the principal executive office of the
Company a register in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide the registration of Warrant Certificates
and transfers or exchanges of Warrant Certificates as herein provided.
11
PAGE 29 OF 76 PAGES
The Holder of a Warrant Certificate, by its acceptance
thereof, covenants and agrees that the Warrants are being acquired, and the
Underlying Common Stock to be purchased upon the exercise of this Warrant will
be acquired, as an investment and not with a view to the distribution thereof
and will not be sold or transferred except in accordance with the applicable
provisions of the Securities Act of 1933, as amended (the "Act") and the rules
and regulations promulgated thereunder, and that neither this Warrant nor any
of the Underlying Common Stock may be offered or sold except (i) pursuant to an
effective registration statement under the Act, (ii) to the extent applicable,
pursuant to Rule 144 under the Act (or any similar rule under the Act relating
to the disposition of securities), or (iii) pursuant to an exemption from
registration under the Act.
The Warrant Certificates and, upon exercise of the Warrants,
in part or in whole, certificates representing the Underlying Common Stock
shall bear a legend substantially similar to the following:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Act"), and may not be offered or sold except (i) pursuant to
an effective registration statement under the Act, (ii) to the
extent applicable, pursuant to Rule 144 under the Act (or any
similar rule under the Act relating to the disposition of
securities), or (iii) pursuant to an exemption from
registration under the Act."
At the option of the Holder, Warrant Certificates may be
exchanged at such office upon payment of the charges
12
PAGE 30 OF 76 PAGES
hereinafter provided. Whenever any Warrant Certificates are so surrendered for
exchange, the Company shall execute and deliver the Warrant Certificates that
the Holder is entitled to receive. All Warrant Certificates issued upon any
registration of transfer or exchange of Warrant Certificates shall be the valid
obligations of the Company, evidencing the same obligations, and entitled to
the same benefits under this Additional Warrant Agreement, as the Warrant
Certificates surrendered for such registration of transfer or exchange.
Every Warrant Certificate surrendered for registration of
transfer or exchange shall (if so required by the Company) be duly endorsed, or
be accompanied by a written instrument of transfer in form satisfactory to the
Company duly executed by the Holder. No service charge shall be made for any
registration of transfer or exchange of Warrant Certificates. The Company may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer of
Warrant Certificates.
8. No Voting or Dividend Rights. Prior to the exercise
of the Warrants, the Holder, as a Holder of Warrant Certificates, shall not be
entitled to any rights of a shareholder of the Company, including, without
limitation, the right to vote, to receive dividends or other distributions or
to exercise any preemptive right, but each Holder of Warrant Certificates shall
receive all notices sent to shareholders of the Company, including any notice
of meetings of shareholders, and shall have the right to attend or observe such
meetings.
13
PAGE 31 OF 76 PAGES
9. Notices. Any notice, demand or delivery authorized
by this Additional Warrant Agreement shall be in writing and shall be
sufficiently given or made upon receipt thereof, if made by personal delivery
or facsimile transmission (with confirmed receipt thereof), or four Business
Days after mailed, if sent by first-class mail, postage prepaid, addressed to
the Investor Representative or the Company, as the case may be, at their
respective addresses below, or such other address as shall have been furnished
in accordance with this Section 10 to the party giving or making such notice,
demand or delivery:
(a) If to the Company, to it at:
Phoenix Information Systems Corp.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
(b) If to the Holder, to the Investor
Representative at:
S-C Phoenix Holdings, L.L.C.
c/o The Chatterjee Group
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
With an additional copy to:
▇▇▇▇▇ Fund Management
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
10. Applicable Law. This Additional Warrant Agreement
and each Warrant Certificate issued hereunder shall be governed by, and
construed in accordance with, the internal laws of the
14
PAGE 32 OF 76 PAGES
State of New York, without regard to the conflicts of law principles thereof.
The Company and each Holder hereby submit to the nonexclusive jurisdiction of
the United States District Court for the Southern District of New York and of
any New York State court sitting in New York City for purposes of all legal
proceedings arising out of or relating to this Additional Warrant Agreement and
the transactions contemplated hereby. The Company and the Holder irrevocably
waive, to the fullest extent permitted by law, any objection which they may now
or hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court has
been brought in an inconvenient forum.
11. Successors and Assigns. The provisions of this
Additional Warrant Agreement shall inure to the benefit of and be binding upon
the respective successors and permitted assigns of the parties. The Holder may
not assign any of its rights hereunder separate from a transfer of the Warrants
in accordance with Section 7 hereof. Nothing in this Additional Warrant
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations or liabilities under or by reason of this Additional
Warrant Agreement.
12. Counterparts. This Additional Warrant Agreement may be
executed by one or more of the parties to this Additional Warrant Agreement in
any number of separate counterparts, each
15
PAGE 33 OF 76 PAGES
of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
13. Captions and Headings. The captions and headings used in
this Additional Warrant Agreement are used for convenience only and are not to
be considered in construing or interpreting this Additional Warrant Agreement.
14. Amendments and Waivers. Any term of this Additional
Warrant Agreement may be amended and the observance of any term of this
Additional Warrant Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), only with the written
consent of the Company and the Holder. Any amendment or waiver effected in
accordance with this paragraph shall be binding upon the Holder, each future
holder of the Warrants and the Company.
15. Severability. If one or more provisions of this
Additional Warrant Agreement are held to be unenforceable under applicable law,
such provisions shall be excluded from this Additional Warrant Agreement and
the balance of the Agreement shall be interpreted as if such provision were so
excluded and shall be enforceable in accordance with its terms.
16
PAGE 34 OF 76 PAGES
IN WITNESS WHEREOF, the parties hereto have caused this
Additional Warrant Agreement to be duly executed as of the day and year first
above written.
PHOENIX INFORMATION SYSTEMS CORP.
By /s/
----------------------------------
Name:
Title:
S-C PHOENIX PARTNERS
By S-C PHOENIX HOLDINGS, L.L.C.,
a General Partner
By /s/
----------------------------------
Name:
Title:
17
PAGE 35 OF 76 PAGES
EXHIBIT A
FORM OF WARRANT CERTIFICATE
THE WARRANTS REPRESENTED BY THIS CERTIFICATE
AND THE OTHER SECURITIES ISSUABLE UPON EXERCISE
THEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE
OFFERED OR SOLD EXCEPT (i) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT, (ii) TO THE EXTENT
APPLICABLE, PURSUANT TO RULE 144 UNDER THE ACT (OR ANY
SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION
OF SECURITIES), OR (iii) PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER THE ACT.
THIS WARRANT CERTIFICATE AND THE WARRANTS
REPRESENTED HEREBY ARE TRANSFERABLE ONLY
IN ACCORDANCE WITH THE PROVISIONS SET FORTH IN
THE Additional Warrant Agreement REFERRED TO BELOW.
WARRANTS TO PURCHASE COMMON STOCK
OF PHOENIX INFORMATION SYSTEMS CORP.
No.___ 140,000 Warrants
This certifies that _______________________ is the owner of
the number of Warrants set forth above, each of which represents the right to
purchase from PHOENIX INFORMATION SYSTEMS CORP., a Delaware corporation (the
"Company"), the number of shares of Common Stock, par value $0.01 per share, of
the Company ("Common Stock") determined in accordance with the Additional
Warrant Agreement referred to below at the purchase price set forth in the
Additional Warrant Agreement (the "Exercise Price"), upon surrender hereof at
the office of the Company at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ with the Exercise Subscription Form on the reverse
hereof duly executed and with payment in full (by bank check or wire transfer
to an account designated by the Company) of the purchase price for the shares
as to which the Warrant(s) represented by this Warrant Certificate are
18
PAGE 36 OF 76 PAGES
exercised, or by surrender of this Warrant Certificate in lieu of cash payment,
all subject to the terms and conditions hereof and of the Additional Warrant
Agreement referred to below. The Warrants will expire at 5 p.m. New York City
time on the Expiration Date.
This Warrant Certificate is issued under and in accordance
with a Additional Warrant Agreement, dated as of February 12, 1996 (the
"Additional Warrant Agreement"), between the Company and S-C Phoenix Partners,
is subject to the terms and provisions contained therein, to all of which terms
and provisions the holder of this Warrant Certificate consents by acceptance
hereof. The Additional Warrant Agreement is hereby incorporated herein by
reference and made a part hereof. Reference is hereby made to the Additional
Warrant Agreement for a full description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Company and the holders of
the Warrants. Capitalized defined terms used herein have the same meanings as
in the Additional Warrant Agreement. Copies of the Additional Warrant
Agreement are on file at the office of the Company and may be obtained by
writing to the Company at the following address:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
The number of shares of the Common Stock of the Company purchasable upon the
exercise of each Warrant and the price per share are set forth in the
Additional Warrant Agreement.
19
PAGE 37 OF 76 PAGES
All shares of Common Stock issuable by the Company upon the
exercise of Warrants and the payment of the Exercise Price therefor shall be
validly issued, fully paid and nonassessable. The Company shall not be
required, however, to pay any tax, withholding or other charge imposed in
connection with the issuance of any shares of Common Stock upon the exercise of
Warrants, and, in such case, the Company shall not be required to issue or
deliver any stock certificate until such tax, withholding or other charge has
been paid or it has been established to the Company's satisfaction that no tax,
withholding or other charge is due. This Warrant Certificate and all rights
hereunder are transferable, subject to the terms of the Additional Warrant
Agreement, by the registered holder hereof, in whole or in part, upon surrender
of this Warrant Certificate duly endorsed, or accompanied by a written
instrument of transfer in form satisfactory to the Company duly executed by the
registered holder and upon payment of any necessary transfer tax or other
governmental charge imposed upon such transfer. Upon any partial transfer, the
Company will issue and deliver to such holder a new Warrant Certificate or
Certificates with respect to any portion not so transferred.
This Warrant Certificate shall be void and all rights
represented hereby shall cease on the Expiration Date.
20
PAGE 38 OF 76 PAGES
Dated:___________, 19__
PHOENIX INFORMATION SYSTEMS CORP.
By /s/
----------------------------------
Name:
Title:
21
PAGE 39 OF 76 PAGES
FORM OF REVERSE OF WARRANT CERTIFICATE
EXERCISE SUBSCRIPTION FORM
(To be executed only upon exercise of Warrant)
To: Phoenix Information Systems Corp.
The undersigned irrevocably exercises ____________ of the
Warrants evidenced by this Warrant Certificate for the purchase of shares of
Common Stock, par value $0.01 per share, of PHOENIX INFORMATION SYSTEMS CORP.
and has arranged to make payment of $___________ (such payment being made by
bank check or wire transfer to the account designated by Phoenix Information
Systems Corp., and constituting the Exercise Price (as defined in the
Additional Warrant Agreement) for the shares as to which the Warrants evidenced
by this Warrant Certificate are exercised) or has surrendered this Warrant
Certificate in lieu of cash payment in accordance with the terms of Section
3(c) of the Additional Warrant Agreement, all on the terms and conditions
specified in this Warrant Certificate and the Additional Warrant Agreement
herein referred to. The undersigned hereby irrevocably surrenders this Warrant
Certificate and all right, title and interest therein to Phoenix Information
Systems Corp. and directs that the shares of Common Stock deliverable upon the
exercise of
22
PAGE 40 OF 76 PAGES
said Warrants be registered or placed in the name and at the address specified
below and delivered thereto. Date: , 19 .
--------- --
------------------------------------(1)
Signature of Owner
------------------------------------
(Street Address)
------------------------------------
(City) (State) (Zip Code)
Securities and/or check to be issued to:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
------------------------
(1) The signature must correspond with the name as written upon the face
of this Warrant Certificate in every particular, without alteration or
enlargement or any change whatever.
23
PAGE 41 OF 76 PAGES
FORM OF ASSIGNMENT
For VALUE RECEIVED, the undersigned registered holder of this
Warrant Certificate hereby sells, assigns and transfers unto the Assignee(s)
named below (including the undersigned with respect to any Warrants
constituting a part of the Warrants evidenced by this Warrant Certificate not
being assigned hereby) all of the right of the undersigned under this Warrant
Certificate, with respect to the number of Warrants set forth below:
Social Security
Names of or other Identifying Number of
Assignees Address Number of Assignee(s) Warrants
--------- ------- --------------------- --------
and does hereby irrevocably constitute and appoint _______________ the
undersigned's attorney to make such transfer on the books of Phoenix
Information Systems Corp. maintained for the purpose, with full power of
substitution.
Dated: ___________, 19__
____________________________________
__________________________________
________________________
(1) The signature must correspond with the name as written upon the face
of this Warrant Certificate in every particular, without alteration or
enlargement or any change whatever.