Exhibit 10.17
Warrant No. 1
NEITHER THIS WARRANT NOR THE UNITS ISSUABLE UPON EXERCISE HEREOF MAY BE
TRANSFERRED, SOLD, ASSIGNED, PLEDGED, ENCUMBERED, HYPOTHECATED OR OTHERWISE
DISPOSED OF UNLESS SUCH TRANSFER, SALE, ASSIGNMENT, PLEDGE, ENCUMBRANCE,
HYPOTHECATION OR OTHER DISPOSITION COMPLIES WITH THE PROVISIONS OF THE
SUBSCRIPTION AGREEMENT DATED AS OF APRIL 1, 1998 (A COPY OF WHICH IS ON FILE
WITH ▇▇▇▇▇▇▇▇▇.▇▇▇ LLC (TOGETHER WITH ITS SUCCESSORS, THE "COMPANY") AND WHICH
SHALL BE MAILED TO THE HOLDER HEREOF WITHOUT CHARGE WITHIN FIVE DAYS AFTER
RECEIPT BY THE COMPANY OF A WRITTEN REQUEST THEREFOR FROM SUCH HOLDER) AND
THE LLC AGREEMENT REFERENCED THEREIN. IN ADDITION TO THE RESTRICTIONS ON
TRANSFER SET FORTH OR REFERRED TO IN SUCH AGREEMENT, NO TRANSFER, SALE,
ASSIGNMENT, PLEDGE, ENCUMBRANCE, HYPOTHECATION OR OTHER DISPOSITION OF THIS
WARRANT OR THE UNITS ISSUABLE UPON EXERCISE HEREOF MAY BE MADE EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND THEIR RULES AND REGULATIONS IN EFFECT THEREUNDER (THE
"ACT"), AND ALL APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS OR (B) IF SUCH
TRANSFER, SALE, ASSIGNMENT, PLEDGE, ENCUMBRANCE, HYPOTHECATION OR OTHER
DISPOSITION IS EXEMPT FROM THE PROVISIONS OF THE ACT AND, IF REQUIRED BY THE
COMPANY, THE COMPANY HAS BEEN FURNISHED WITH AN OPINION OF COUNSEL FOR THE
HOLDER, WHICH OPINION AND COUNSEL SHALL BE REASONABLY SATISFACTORY TO THE
COMPANY, TO THAT EFFECT. THE HOLDER OF THIS WARRANT, BY ACCEPTANCE HEREOF,
AGREES TO BE BOUND BY ALL OF THE PROVISIONS OF THE AFORESAID AGREEMENTS.
▇▇▇▇▇▇▇▇▇.▇▇▇ LLC
(Organized under the laws of the State of Delaware)
Void after 5:00 p.m., New York City time, on April 15, 2003
Warrant for the Purchase of 50,000 Units
FOR VALUE RECEIVED, ▇▇▇▇▇▇▇▇▇.▇▇▇ LLC, a Delaware limited liability
company (the "Company"), hereby certifies that
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(the "Holder") is entitled, subject to the provisions of this warrant (the
"Warrant"), to purchase from the Company, at any time, or from time to time
during the period commencing at 9:00 a.m. New York City local time on April 15,
1998 (the "Base Date"), and expiring at 5:00 p.m. New York City
local time on April 15, 2003 (the "Termination Date") up to FIFTY THOUSAND
UNITS of the Company at a price of $1.00 per Unit (such exercise price per
unit, as adjusted, being hereinafter referred to as the "Exercise Price").
The term "Unit" means the Units of the Company as constituted on the Base
Date, together with any other equity securities that may be issued by the
Company in addition thereto or in substitution therefor. The number of
Units to be received upon the exercise of this Warrant may be adjusted from
time to time as hereinafter set forth. The Units deliverable upon such
exercise, and as adjusted from time to time, are hereinafter sometimes
referred to as "Warrant Units".
Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of this Warrant, and (in the
case of loss, theft or destruction) of reasonably satisfactory
indemnification, and upon surrender and cancellation of this Warrant, if
mutilated, the Company shall execute and deliver a new Warrant of like tenor
and date.
The Holder agrees with the Company that this Warrant is issued, and
all the rights hereunder shall be paid, subject to all of the conditions,
limitations and provisions set forth herein.
1. Exercise of Warrant. This Warrant may be exercised in whole or
in part at any time, or from time to time, during the period commencing at
9:00 a.m. New York City local time, on the Base Date and expiring at 5:00
p.m., New york City local time, on the Termination Date or if such day is a
day on which banking institutions in the City of New York are authorized by
law to close, then on the next succeeding day that shall not be such a day, by
presentation and surrender hereof to the Company at its principal office with
the Warrant Exercise Form attached hereto duly executed and accompanied by
payment (either in cash or by certified or official bank check, payable to
the order of the Company), of the Exercise Price for the number of Units
specified in such Form and instruments of transfer, if appropriate, duly
executed by the Holder or his or her duly authorized attorney. If this
Warrant should be exercised in part only, the Company shall, upon surrender
of this Warrant for cancellation, execute and deliver a new Warrant
evidencing the rights of the Holder thereof to purchase the balance of the
Units purchasable hereunder. Upon receipt by the Company of this Warrant,
together with the Exercise Price, in proper form for exercise, the Holder
shall be deemed to be the holder of record of the Units issuable upon such
exercise, notwithstanding that the transfer books of the Company shall then
be closed or that certificates representing such Units shall not then be
actually delivered to the Holder. The Company shall pay any and all
documentary stamp or similar issue or transfer taxes payable in respect of
the issue or delivery of Units on exercise of this Warrant.
2. Reservation of Units. The Company will at all times reserve for
issuance and delivery upon exercise of this Warrant all Units or other
equity securities of the Company (and other securities and property) from
time to time receivable upon exercise of this Warrant. All such Units (and
other securities and property) shall be duly authorized and, when issued upon
such exercise, shall be validly issued, fully paid and nonassessable and free
of all preemptive rights.
3. Restrictions Upon Transferability of Warrant and Warrant Stock:
Transfer to Comply with the Securities Act of 1933 and the Subscription
Agreement. Neither this Warrant nor the
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Warrant Units issuable upon exercise of this Warrant have been registered
under the Securities Act of 1933, as amended (the "Act"). Holders hereof and
thereof shall be subject to such restrictions upon the sale or other
disposition thereof, all as more fully set forth in or referred to in the
Subscription Agreement of even date herewith between the Company and the
Holder (the "Subscription Agreement") and the Limited Liability Company
Agreement of the Company dated as of July 18, 1997 (as same may be amended,
the "LLC Agreement"). The Subscription Agreement and the LLC Agreement are
incorporated by reference as an integral part of this Warrant.
4. Exchange, Transfer, Assignment of Loss of Warrant. This Warrant cannot
be exchanged, transferred or assigned otherwise than in accordance with the
provisions of the Subscription Agreement and the LLC Agreement. If the
provisions of the Subscription Agreement are complied with, upon surrender of
this Warrant to the Company with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the heir,
devisee or assignee named in such instrument of assignment and this Warrant
shall promptly be cancelled.
5. Rights of the Holder. The Holder shall not, by virtue hereof, be
entitled to any rights of a Unitholder of the Company, either at law or in
equity, and the rights of the Holder are limited to those expressed in this
Warrant.
6. Redemption. This Warrant is not redeemable by the Company.
7. Adjustment of Exercise Price and Number and Kind of Securities
Purchasable upon Exercise of Warrant.
(a) Definitions. As used in this Agreement, the following terms have
the following respective meanings:
(i) "Options" means any right, option, or warrant to subscribe
for, purchase, or otherwise acquire Units or Convertible Securities.
(ii) "Convertible Securities" means any evidences of
indebtedness, units or other securities directly or indirectly convertible
into or exchangeable for Units.
(iii) "Issue" means to grant, issue, sell assume, or fix a record
date for determining persons entitled to receive, any security (including
Options), whichever of the foregoing is the first to occur.
(iv) "Additional Units" means all Units (including reissued
Units) issued (or deemed to be issued pursuant to Section 7(b)) after the date
of issuance of this Warrant.
(b) Deemed Issuance of Additional Units. The Units issuable upon
exercise of an Option (including the Units issuable upon conversion or
exercise of a Convertible Security issuable pursuant to an Option) are deemed
to be Issued when the Option is Issued. The Units ultimately issuable upon
conversion or exercise of a Convertible Security (other than a Convertible
Security
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Issued pursuant to an Option) shall be deemed Issued upon issuance of the
Convertible Security. The maximum amount of Units issuable is determined
without regard to any future adjustments permitted under the instrument
creating the Options or Convertible Securities.
(c) Adjustment of Exercise Price for Diluting Issuances.
(i) Weighted Average Adjustment. If the Company issues
Additional Units after the date of this Agreement and the consideration per
share of Additional Units (determined pursuant to Section 7(h)) is less than
the Exercise Price in effect immediately before such Issue, the Exercise
Price in effect immediately before such issue shall be reduced, concurrently
with such Issue, to a price (calculated to the nearest cent) determined by
multiplying the Exercise Price by a fraction:
(A) the numerator of which is the number of Units
outstanding immediately before such Issue plus the number of Units that the
aggregate consideration received by the Company for such Additional Units
would purchase at the Exercise Price in effect immediately before such Issue,
and
(B) the denominator of which is the number of Units
outstanding immediately before such Issue plus the number of such Additional
Units.
(ii) Adjustment of Number of Units. Upon each adjustment of
the Exercise Price, the number of Units issuable upon exercise of this
Warrant shall be increased to equal the quotient obtained by dividing (a) the
product resulting from multiplying (i) the number of Units issuable upon
exercise of this Warrant and (ii) the Exercise Price, in each case as in
effect immediately before such adjustment, by (b) the adjusted Exercise Price.
(iii) Securities Deemed Outstanding. For the purpose of this
Section 7(c), all securities issuable upon exercise of any outstanding
Convertible Security or Options, warrants, or other rights to acquire
securities of the Company shall be deemed to be outstanding.
(d) No Adjustment for Issuances Following Deemed Issuances. No
adjustment to the Exercise Price shall be made upon the exercise of Options
or conversion of Convertible Securities.
(e) Adjustment Following Changes in Terms of Options or
Convertible Securities. If the consideration payable to, or the amount of
Units Issuable by, the Company increases or decreases, respectively, pursuant
to the terms of any outstanding Options or Convertible Securities, the
Exercise Price shall be recomputed to reflect such increase or decrease. The
recomputation shall be made as of the time of the issuances of the Options or
Convertible Securities. Any changes in the Exercise Price that occurred after
such issuance because Additional Units were issued or deemed Issued shall
also be recomputed.
(f) Recomputation Upon Expiration of Options or Convertible
Securities. The Exercise Price computed upon the original Issue of any
Options or Convertible Securities, and any
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subsequent adjustments based thereon, shall be recomputed when any Options or
rights of conversion under Convertible Securities expires without having been
exercised. In the case of Convertible Securities or Options for Units, the
Exercise Price shall be recomputed as if the only Additional Units were the
Units actually Issued upon the exercise of such securities, if any, and as if
the only consideration received therefor was the consideration actually
received upon the Issue, exercise or conversion of the Options or Convertible
Securities. In the case of Options for Convertible Securities, the Exercise
Price for this Warrant shall be recomputed as if the only Convertible
Securities Issued were the Convertible Securities actually Issued upon the
exercise thereof, if any, and as if the only consideration received therefor
was the consideration actually received by the Company (determined pursuant
to Section 7(i)), if any, upon the Issue of the Options for the Convertible
Securities.
(g) Limit on Readjustments. No readjustment of the Exercise Price for
this Warrant pursuant to Section 7(e) or 7(f) shall increase the Exercise
Price more than the amount of any decrease made in respect of the Issue of
any Options or Convertible Securities.
(h) Computation of Consideration. The consideration received by the
Company for the Issue of any Additional Units shall be computed as follows:
(i) Cash. Cash shall be valued at the amount of cash received by
the Company, excluding amounts paid or payable for accrued interest or
accrued dividends.
(ii) Property. Property other than cash shall be computed at the
fair market value thereof at the time of the Issue as determined in good faith
by [the Board of Managers] of the Company.
(iii) Mixed Consideration. The consideration for Additional Units
Issued together with other property of the Company for consideration that
covers both shall be determined in good faith by the Board of Managers of the
Company.
(iv) Options and Convertible Securities. The consideration per
Additional Unit for Options and Convertible Securities shall be determined by
dividing:
(A) the total amount, if any, received or receivable by the
Company for the Issue of the Options or Convertible Securities, plus the
minimum amount of additional consideration (as set forth in the instruments
relating thereto, without regard to any provision contained therein for a
subsequent adjustment of such consideration) payable to the Company upon
exercise of the Options or conversion of the Convertible Securities, by
(B) the maximum amount of Units (as set forth in the
instruments relating thereto, without regard to any provision contained
therein for a subsequent adjustment of such number) ultimately Issuable upon
the exercise of such Options or the conversion of such Convertible Securities.
(i) Unit Distributions. In case at any time the Company shall declare a
dividend
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or make any other distribution upon any Units of the Company which is payable
in Unit or Convertible Securities, any Units or Convertible Securities, as
the case may be, issuable in payment of such dividend or distribution shall
be deemed to have been issued or sold without consideration.
(j) Subdivision or Combination of Units. In case the Company shall at
any time subdivide the outstanding Units into a greater number of Units, the
Exercise Price in effect immediately prior to such subdivision shall be
proportionately reduced and the number of Units issuable upon exercise of
this Warrant immediately prior to such subdivision shall be proportionately
increased, and conversely, in case the outstanding Units shall be combined at
any time into a smaller number of Units, the Exercise Price in effect
immediately prior to such combination shall be proportionately increased and
the number of Units issuable upon exercise of this Warrant immediately prior
to such combination shall be proportionately reduced.
(k) Adjustments for Consolidation, Merger, Sale of Assets,
Reorganization, etc. In case the Company (i) consolidates with or merges into
any other entity and is not the continuing or surviving entity of such
consolidation or merger, or (ii) permits any other entity to consolidate with
or merge into the Company and the Company is the continuing or surviving
Company but, in connection with such consolidation or merger, the Units are
changed into or exchanged for units or other securities of any other entity
or cash or any other assets, or (iii) transfers all or substantially all of
its properties and assets to any other entity, or (iv) effects a
reorganization or reclassification of the equity of the Company in such a way
that holders of Units shall be entitled to receive stock, securities, cash or
assets with respect to or in exchange for Units, then, and in each such case,
proper provision shall be made so that, upon the exercise of this Warrant at
any time after the consummation of such consolidation, merger, transfer,
reorganization or reclassification, each Holder shall be entitled to receive
(at the aggregate Exercise Price in effect for Units issuable upon such
exercise of this Warrant immediately prior to such consummation), in lieu of
Units issuable upon such exercise of this Warrant prior to such consummation,
the stock and other securities, cash and assets to which such Holder would
have been entitled upon such consummation if such Holder had so exercised
this Warrant immediately prior thereto (subject to adjustments subsequent to
such action as nearly equivalent as possible to the adjustments provided for
in this Section 7).
(l) Notice of Adjustment. Whenever the number of Units issuable upon the
exercise of this Warrant or the Exercise Price for this Warrant is adjusted,
as provided in this Section 7, the Company shall prepare and mail to each
Holder a certificate setting forth (i) the Exercise Price and the number of
Units issuable upon the exercise of this Warrant after such adjustment, (ii)
a brief statement of the facts requiring such adjustment and (iii) the
computation by which such adjustment was made.
(m) No Change of Warrant Necessary. Irrespective of any adjustment in
the Exercise Price for this Warrant or in the number or kind of securities
issuable upon exercise of this Warrant, unless the Holder of this Warrant
otherwise requests, this Warrant may continue to express the same price and
number and kind of Units as are stated in this Warrant as initially issued.
(n) Treasury Units. The number of Units outstanding at any given time
shall not include Units owned or held by or for the account of the Company.
The disposition of any Units
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owned or held by or for the account of the Company shall be considered an
issue of Units for the purposes of this Section 7.
(o) Certain Adjustment Rules.
(i) The provisions of this Section 7 shall similarly apply to
successive transactions.
(ii) If the Company shall declare any distribution referred
to in Section 7(i) and if any Holder exercises all or any part of this
Warrant after such declaration but before the payment of such distribution,
the Company may elect to defer, until the payment of such distribution,
issuing to such Holder the Units issuable upon such exercise of this Warrant
on the basis of the applicable Exercise Price in effect prior to such
adjustment; provided, however, that the Company shall deliver to each such
Holder a due ▇▇▇▇ or other appropriate instrument evidencing such Holder's
right to receive such additional Units upon the payment of such distribution.
(iii) If the Company shall declare any distribution referred
to in Section 7(i) and shall legally abandon such distribution prior to
payment, then no adjustment shall be made pursuant to this Section 7 in
respect of such declaration.
(p) Exceptions to Adjustment to Purchase Price. Notwithstanding
anything herein to the contrary, no adjustment to the Exercise Price for this
Warrant or the number of Units issuable upon exercise of this Warrant shall
be made in the case of the following:
(i) the issuance of any Units upon any exercise of this
Warrant or any adjustment of the Exercise Price for this Warrant;
(ii) the grant of issuance of Options to purchase Units to
employees, officers or directors of the Company; and
(iii) the issuance of any Units upon the exercise of any
Options outstanding as of the date hereof.
8. Legend. Upon exercise of this Warrant and the issuance of any of the
Warrant Units hereunder, all certificates representing Units shall bear on
the face thereof substantially the following legends, insofar as is
consistent with Delaware Law:
"The Units represented by this certificate have not been registered
under the Securities Act of 1933, as amended, and may not be sold,
offered for sale, assigned, transferred or otherwise disposed of,
unless registered pursuant to the provisions of that Act or an
opinion of counsel to the Company is obtained stating that such
disposition is in compliance with an available exemption from such
registration."
9. Applicable Law. This Warrant is issued under and shall for all
purposes be governed by and construed in accordance with the laws of the
State of Connecticut.
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10. Notice. Notices and other communications to be given hereunder
shall be given in accordance with the Subscription Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed on
its behalf, by its duly authorized officer.
▇▇▇▇▇▇▇▇▇.▇▇▇ LLL
By /s/ ▇▇▇ ▇▇▇▇▇▇
--------------------------
▇▇▇ ▇▇▇▇▇▇
Its President
Dated: April 15, 1998
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WARRANT EXERCISE FORM
The undersigned hereby irrevocably elects to exercise to the extent of
purchasing _________ Units of ▇▇▇▇▇▇▇▇▇.▇▇▇ LLC and hereby makes payment at
the rate of $_______ per share or an aggregate of $_________ in payment
therefor.
____________________________
Name of Registered Holder
____________________________
Signature
____________________________
Signature, if held jointly
____________________________
Date
INSTRUCTIONS FOR ISSUANCE OF UNITS
(If other than to the registered holder of the within warrant)
Name_______________________________________________________________________
(Please typewrite or print in block letters)
Address____________________________________________________________________
___________________________________________________________________________
Social Security or Taxpayer Identification Number__________________________
ASSIGNMENT FORM
The Holder hereby assigns and transfers unto
Name_______________________________________________________________________
(Please typewrite or print in block letters)
Address____________________________________________________________________
___________________________________________________________________________
the right to purchase Units of ▇▇▇▇▇▇▇▇▇.▇▇▇ LLC represented by this
Warrant to the extent of ____ Units as to which such right is exercisable and
does hereby irrevocably constitute and appoint ____________ Attorney, to
transfer the same on the books of the Company with full power of substitution
in the premises.
DATED:________________________ ____________________________
Name of Registered Holder
____________________________
Signature
____________________________
Signature, if held jointly
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