Exhibit 5
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THIS WARRANT AND THE SECURITIES ISSUABLE UPON ITS EXERCISE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
SECURITIES LAWS OF ANY STATE AND MAY NOT BE OFFERED, SOLD, ASSIGNED, PLEDGED,
TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH LAWS AND, IF
REQUESTED BY THE COMPANY, UPON DELIVERY OF AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY THAT THE PROPOSED TRANSFER IS EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE ACT AND SUCH LAWS.
THIS WARRANT IS SUBJECT TO AGREEMENTS, COVENANTS AND RESTRICTIONS IN REGARD TO
THE TRANSFER THEREOF AS PROVIDED IN THE PROVISIONS OF THAT CERTAIN SECURITIES
PURCHASE AGREEMENT DATED AS OF FEBRUARY 12, 2003 BY AND BETWEEN THE COMPANY AND
WARBURG PINCUS PRIVATE EQUITY VIII, L.P., A COPY OF WHICH IS ON FILE AT THE
OFFICE OF THE SECRETARY OF THE COMPANY.
▇▇▇▇▇▇▇, INC.
Common Stock Purchase Warrant
▇▇▇▇▇▇▇, Inc., a Delaware corporation (the "Company"), hereby certifies
that, for value received, Warburg Pincus Private Equity VIII, L.P. ("Warburg"),
or its assigns (the "Holder"), is entitled, subject to the terms set forth
below, to purchase from the Company, at any time and from time to time during
the period beginning on June 27, 2003 and ending on June 27, 2010 (the
"Expiration Date"), in whole or in part, an aggregate of 1,250,000 fully paid
and non-assessable shares of the Common Stock of the Company at a purchase
price, subject to the provisions of Paragraph 3 hereof, of $11.25 per share (the
"Purchase Price"). The Purchase Price and the number and character of such
shares are subject to adjustment as provided below, and the term "Common Stock"
shall mean, unless the context otherwise requires, the stock or other securities
or property at the time deliverable upon the exercise of this Warrant. This
Warrant is herein called the "Warrant."
EXERCISE OF WARRANT. The purchase rights evidenced by this Warrant shall be
exercised by the Holder surrendering this Warrant, with the form of subscription
at the end hereof duly executed by the Holder, to the Company at its office in
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, accompanied by payment, of an
amount (the "Exercise Payment") equal to the Purchase Price multiplied by the
number of shares being purchased pursuant to such exercise, payable as follows:
(i) by payment to the Company in cash, by certified or official bank check, or
by wire transfer of the Exercise Payment, (ii) by surrender to the Company for
cancellation of securities of the Company having a Market Price (as hereinafter
defined) on the date of exercise equal to the Exercise Payment; or (c) by a
combination of the methods described in clauses (a) and (b) above. In lieu of
exercising the Warrant, the holder may elect to receive a payment, payable by
the Company to the Holder only in shares of Common Stock, valued at the
Market Price on the date of exercise, equal to the difference between (i) the
Market Price on the date of exercise multiplied by the number of shares as to
which the Warrant is then being exercised and (ii) the Exercise Payment with
respect to such shares. For purposes hereof, the term "Market Price" shall mean,
with respect to any day, the volume weighted average closing price of a share of
Common Stock for the 20 consecutive trading days preceding such day on the
principal national securities exchange on which the shares of Common Stock or
securities are listed or admitted to trading or, if not listed or admitted to
trading on any national securities exchange, the average of the reported bid and
asked prices during such 20 trading day period in the over-the-counter market as
furnished by the National Quotation Bureau, Inc., or, if such firm is not then
engaged in the business of reporting such prices, as furnished by any member of
the National Association of Securities Dealers, Inc. ("NASD") selected by the
Company or, if the shares of Common Stock or securities are not publicly traded,
the fair market value thereof determined jointly by the Company and the Holder;
provided, however, that if such parties are unable to reach agreement within a
reasonable period of time, the fair market value shall be determined in good
faith by the independent investment banking firm selected jointly by the Company
and the Holder or, if that selection cannot be made within 20 days, by an
independent investment banking firm selected by the American Arbitration
Association in accordance with its rules. In no event may this Warrant be
exercised at any time after the Expiration Date.
1.1. Partial Exercise. This Warrant may be exercised for less than the full
number of shares of Common Stock, in which case the number of shares receivable
upon the exercise of this Warrant as a whole, and the sum payable upon the
exercise of this Warrant as a whole, shall be proportionately reduced. Upon any
such partial exercise, the Company at its expense will forthwith issue to the
Holder a new Warrant or Warrants of like tenor calling for the number of shares
of Common Stock as to which rights have not been exercised, such Warrant or
Warrants to be issued in the name of the Holder hereof or his or its nominee.
2. DELIVERY OF STOCK CERTIFICATES ON EXERCISE. As soon as practicable after
the exercise of this Warrant and payment of the Purchase Price, and in any event
within ten (10) days thereafter, the Company, at its expense, will cause to be
issued in the name of and delivered to the Holder a certificate or certificates
for the number of fully paid and non-assessable shares or other securities or
property to which the Holder shall be entitled upon such exercise, plus, in lieu
of any fractional share to which the Holder would otherwise be entitled, cash in
an amount determined in accordance with Paragraph 3.8 hereof. The Company agrees
that the shares so purchased shall be deemed to be issued to the Holder as the
record owner of such shares as of the close of business on the date on which
this Warrant shall have been surrendered and payment made for such shares as
aforesaid.
3. ANTI-DILUTION PROVISIONS AND OTHER ADJUSTMENTS. In order to prevent
dilution of the rights granted hereunder, the Purchase Price shall be subject to
adjustment from time to time in accordance with this Paragraph 3. Upon each
adjustment of the Purchase Price pursuant to this Paragraph 3, the registered
Holder of this Warrant shall thereafter be entitled to acquire upon exercise, at
the Purchase Price resulting from such adjustment, the number of shares of
Common Stock obtainable by multiplying the Purchase Price in effect immediately
prior to such adjustment by the number of shares of Common Stock acquirable
immediately prior to such adjustment and dividing the product thereof by the
Purchase Price resulting from such adjustment.
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3.1. Adjustment for Issue or Sale of Common Stock at Less than New Security
Market Price. Except as provided in Paragraph 3.4 below, if and whenever on or
after the date hereof, the Company shall issue or sell, or shall in accordance
with subparagraphs 3.1(1) to (9), inclusive, be deemed to have issued or sold
any shares of its Common Stock for a consideration per share less than the New
Security Market Price immediately prior to the time of such issue or sale, then,
forthwith upon such issue or sale or if such issue or sale is pursuant to any
contract or agreement (excluding Options (as defined below)), the New Security
Market Price as of the date the Company became legally bound to issue or sell
(the "Triggering Transaction"), the Purchase Price in effect immediately prior
to the time of such Triggering Transaction shall (subject to subparagraphs
3.1(1) to (9)) be reduced to the Purchase Price (calculated to the nearest tenth
of a cent) determined by multiplying the Purchase Price in effect immediately
prior to the time of such Triggering Transaction by a fraction, the numerator of
which shall be the sum of (x) the Number of Shares Outstanding immediately prior
to such Triggering Transaction multiplied by the New Security Market Price
immediately prior to such Triggering Transaction plus (y) the consideration
received by the Company upon such Triggering Transaction, and the denominator of
which shall be the product of (x) the Number of Shares Outstanding immediately
prior to such Triggering Transaction plus the number of shares issued or deemed
to be issued pursuant to subparagraphs 3.1(1) to (9) in such Triggering
Transaction, multiplied by (y) the New Security Market Price immediately prior
to such Triggering Transaction.
For purposes of this Paragraph 3.1, (A) the term "New Security Market
Price" shall mean, with respect to any day, the volume weighted average price of
a share of Common Stock for the trading day preceding such day on the principal
national securities exchange on which the shares of Common Stock or securities
are listed or admitted to trading or, if not listed or admitted to trading on
any national securities exchange, the average of the reported bid and asked
prices for such trading day in the over-the-counter market as furnished by the
National Quotation Bureau, Inc., or, if such firm is not then engaged in the
business of reporting such prices, as furnished by any member of the NASD
selected by the Corporation or, if the shares of Common Stock or securities are
not publicly traded, the Private Value; and (B) the term "Number of Shares
Outstanding" means, at any given time, the number of shares of Common Stock
actually outstanding at such time, plus the number of shares of Common Stock
issuable upon conversion or exercise in full of all Convertible Securities and
Options, each as defined below (including Convertible Securities and Options
outstanding on the date hereof or hereinafter issued) whether or not the
Convertible Securities or Options are convertible into or exercisable for Common
Stock at such time, but shall not include (a) any shares of Common Stock or
Convertible Securities in the treasury of the Corporation or held for the
account of the Corporation or any of its Subsidiaries, (b) any shares of Common
Stock issued or reserved for issuance under stock option, restricted stock,
retirement or executive ownership plans to the extent that such shares or
Options to purchase such shares are issued or granted after the date hereof and
(c) prior to the occurrence of a Conversion Event (as defined in the terms of
such Notes or such Series A Preferred Stock or Series B Preferred Stock), any
shares of Common Stock issuable upon conversion of the Notes or the Series A
Preferred Stock and the Series B Preferred Stock issued pursuant to the Purchase
Agreement (as defined below).
For purposes of determining the adjusted Purchase Price under this
Paragraph 3.1, the following subsections (1) to (9), inclusive, shall be
applicable:
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(1) In case the Company at any time after the date hereof shall in any
manner grant (whether directly or by assumption in a merger or otherwise)
any rights to subscribe for or to purchase, or any options for the purchase
of, Common Stock or any stock or other securities convertible into or
exchangeable for Common Stock (such rights or options being herein called
"Options" and such convertible or exchangeable stock or securities being
herein called "Convertible Securities"), whether or not such Options or the
right to convert or exchange any such Convertible Securities are
immediately exercisable, and the price per share for which the Common Stock
is issuable upon exercise, conversion or exchange (determined by dividing
(x) the total amount, if any, received or receivable by the Company as
consideration for the granting of such Options, plus the minimum aggregate
amount of additional consideration payable to the Company upon the exercise
of all such Options, plus, in the case of such Options which relate to
Convertible Securities, the minimum aggregate amount of additional
consideration, if any, payable upon the issue or sale of such Convertible
Securities and upon the conversion or exchange thereof, by (y) the total
maximum number of shares of Common Stock issuable upon the exercise of such
Options or the conversion or exchange of such Convertible Securities) shall
be less than the New Security Market Price immediately prior to the time of
the granting of such Option, then the total maximum amount of Common Stock
issuable upon the exercise of such Options (including, without limitation,
by reason of accretion or accrual of interest or dividends), or, in the
case of Options for Convertible Securities, upon the conversion or exchange
of such Convertible Securities, shall (as of the date of granting of such
Options) be deemed to be outstanding and to have been issued and sold by
the Company for such price per share. No adjustment of the Purchase Price
shall be made upon the actual issue of such shares of Common Stock or such
Convertible Securities upon the exercise of such Options, except as
otherwise provided in subparagraph (3) below.
(2) In case the Company at any time after the date hereof shall in any
manner issue (whether directly or by assumption in a merger or otherwise)
or sell any Convertible Securities, whether or not the rights to exchange
or convert thereunder are immediately exercisable, and the price per share
for which Common Stock is issuable upon such conversion or exchange
(determined by dividing (x) the total amount received or receivable by the
Company as consideration for the issue or sale of such Convertible
Securities, plus the minimum aggregate amount of additional consideration,
if any, payable to the Company upon the conversion or exchange thereof, by
(y) the total maximum number of shares of Common Stock issuable upon the
conversion or exchange of all such Convertible Securities) shall be less
than the New Security Market Price immediately prior to the time of such
issue or sale, then the total maximum number of shares of Common Stock
issuable upon conversion or exchange of all such Convertible Securities
shall (as of the date of the issue or sale of such Convertible Securities)
be deemed to be outstanding and to have been issued and sold by the Company
for such price per share. No adjustment of the Purchase Price shall be made
upon the actual issue of such Common Stock upon exercise of
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the rights to exchange or convert under such Convertible Securities, except
as otherwise provided in subparagraph (3) below.
(3) If the additional consideration payable upon the exercise of any
Options referred to in subparagraph (1), the additional consideration, if
any, payable upon the conversion or exchange of any Convertible Securities
referred to in subparagraphs (1) or (2), or the rate at which any
Convertible Securities referred to in subparagraph (1) or (2) are
convertible into or exchangeable for Common Stock shall change at any time
(other than under or by reason of provisions providing for a weighted
average anti-dilution adjustment, whether based on issuances at below the
applicable conversion or exercise price or below market value), the
Purchase Price in effect at the time of such change shall forthwith be
readjusted to the Purchase Price which would have been in effect at such
time had such Options or Convertible Securities still outstanding provided
for such changed additional consideration or conversion rate, as the case
may be, at the time initially granted, issued or sold.
(4) On the expiration of any Option or the termination of any right to
convert or exchange any Convertible Securities as to which an adjustment to
the Conversion Price was made pursuant to paragraph (1) or (2) above, the
Purchase Price then in effect hereunder shall forthwith be increased to the
Purchase Price which would have been in effect at the time of such
expiration or termination had such Option or Convertible Securities, to the
extent outstanding immediately prior to such expiration or termination,
never been issued.
(5) In case any Options shall be issued in connection with the issue
or sale of other securities of the Company, together comprising one
integral transaction in which no specific consideration is allocated to
such Options by the parties thereto, such Options shall be deemed to have
been issued for the consideration determined in good faith by the Board of
Directors of the Company (the "Board of Directors") to be attributable to
such Options.
(6) In case any shares of Common Stock, Options or Convertible
Securities shall be issued or sold or deemed to have been issued or sold
for cash, the consideration received therefor shall be deemed to be the
amount received by the Company therefor. In case any shares of Common
Stock, Options or Convertible Securities shall be issued or sold for a
consideration other than cash, the amount of the consideration other than
cash received by the Company shall be the fair value of such consideration
as determined in good faith by the Board of Directors. In case any shares
of Common Stock, Options or Convertible Securities shall be issued in
connection with any merger in which the Company is the surviving
corporation (including the assumption or exchange of Options and
Convertible Securities of the non-surviving corporation), the amount of
consideration received by the Company therefor shall be deemed to be the
fair value of such portion of the net assets and business of the
non-surviving corporation as shall be attributed by the Board of Directors
in good faith to such Common Stock, Options or Convertible Securities, as
the case may be. The
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consideration received by the Company in connection with the issuance and
sale or deemed issuance and sale of any Common Stock, Options or
Convertible Securities shall be computed based upon the total consideration
received or determined to be received by the Company in accordance with the
terms hereof before giving effect to any customary underwriting discounts
or commissions, placement agency fees or other customary transaction
expenses typically borne by an issuer but after giving effect to any other
discounts or fees.
(7) The number of shares of Common Stock outstanding at any given time
shall not include shares owned or held by or for the account of the
Company, and the disposition of any shares so owned or held shall be
considered an issue or sale of Common Stock for the purpose of this
Paragraph 3.1.
(8) In case the Company shall declare a dividend or make any other
distribution upon the stock of the Company payable in Options or
Convertible Securities, then any Options 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.
(9) For purposes of this Paragraph 3.1, in case the Company shall take
a record of the holders of its Common Stock for the purpose of entitling
them (x) to receive a dividend or other distribution payable in Common
Stock, Options or in Convertible Securities, or (y) to subscribe for or
purchase Common Stock, Options or Convertible Securities, then such record
date shall be deemed to be the date of the issue or sale of the shares of
Common Stock deemed to have been issued or sold upon the declaration of
such dividend or the making of such other distribution or the date of the
granting of such right or subscription or purchase, as the case may be.
3.2. Subdivisions and Combinations. In case the Company shall at any time
(i) subdivide the outstanding Common Stock or (ii) issue a dividend on its
outstanding Common Stock payable in shares of Common Stock, the Purchase Price
in effect immediately prior to such dividend or subdivision shall be
proportionately reduced by the same ratio as the subdivision or dividend. In
case the Company shall at any time combine its outstanding Common Stock, the
Purchase Price in effect immediately prior to such combination shall be
proportionately increased by the same ratio as the combination.
3.3. Reorganization, Reclassification, Consolidation, Merger or Sale of
Assets. If any capital reorganization or reclassification of the capital stock
of the Company, or consolidation or merger of the Company with or into another
person, or the sale of all or substantially all of its assets to another person
shall be effected in such a way that holders of Common Stock shall be entitled
to receive stock, securities, cash or other property with respect to or in
exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provision
shall be made whereby each Holder shall have the right to acquire and receive,
upon exercise of this Warrant, such shares of stock, securities, cash or other
property issuable or payable (as part of the reorganization, reclassification,
consolidation, merger or sale) with respect to or in exchange for
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such number of outstanding shares of the Common Stock as would have been
received upon exercise of this Warrant at the Purchase Price then in effect. The
Company will not effect any such consolidation, merger or sale, unless prior to
the consummation thereof the successor person (if other than the Company)
resulting from such consolidation or merger or the person purchasing such assets
shall assume by written instrument mailed or delivered to the Holder at the last
address of the Holder appearing on the books of the Company, the obligation to
deliver to the Holder such shares of stock, securities or assets as, in
accordance with the foregoing provisions, the Holder may be entitled to
purchase. Notwithstanding the foregoing, in the event of any consolidation or
merger of the Company with another person in which all outstanding shares of
Common Stock are converted into the right to receive cash, the Company shall
have the right to extinguish the Warrant upon the consummation of such
consolidation or merger if the holder of the Warrant is entitled to receive upon
such consummation, in respect of each share of Common Stock for which the
Warrant is then exercisable, the same amount (net of the Purchase Price) in cash
as a holder of a share of Common Stock will receive in such transaction.
3.4. No Adjustment for Exercise of Certain Options, Warrants, Etc. The
provisions of this Paragraph 3 shall not apply to the following shares of Common
Stock issued, issuable or deemed outstanding under subparagraphs 3.1(1) to (9)
inclusive: (i) shares of Common Stock issued or issuable upon (A) conversion of
(x) the Company's notes (the "Notes") (and including any cash payment for Excess
Shares (as such term is defined in the Notes)), (y) the Company's Series A
Convertible Preferred Stock (the "Series A Preferred Stock") or (z) the
Company's Series B Convertible Preferred Stock (the "Series B Preferred Stock"),
and (B) the exercise of these Warrants, in each case issued or issuable under
the Securities Purchase Agreement dated as of February 12, 2003 between the
Company and Warburg (the "Purchase Agreement"), (ii) other warrants to purchase
Common Stock issued or issuable to the Holder pursuant to the Purchase Agreement
and the Common Stock issuable upon exercise thereof, (iii) warrants issued to
lenders of non-convertible debt and the Common Stock issuable upon exercise
thereof; provided such warrants do not exceed, in the aggregate, 5% of the
issued and outstanding shares of Common Stock and the terms thereof have been
approved by the Board of Directors, (iv) shares of Common Stock issued as
consideration for bona fide acquisitions, mergers, joint ventures or similar
transactions, provided that the terms thereof are approved by the Board of
Directors, (v) shares of Common Stock issued or issuable pursuant to any stock
option, stock purchase or similar plan or arrangement for the benefit of the
employees, directors or consultants of the Company or its subsidiaries, duly
adopted by the Board of Directors and (vi) shares of Common Stock issued in a
bona fide underwritten public offering underwritten by a nationally recognized
investment bank pursuant to an effective registration under the Securities Act
of 1933, as amended, or any similar statute then in force.
3.5. Notices of Record Date, Etc. In the event that:
(1) the Company shall declare any cash dividend upon its Common Stock
other than the Company's regular quarterly cash dividend, or
(2) the Company shall declare any dividend upon its Common Stock
payable in stock or make any special dividend or other distribution to the
holders of its Common Stock, or
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(3) the Company shall offer for subscription pro rata to the holders
of its Common Stock any additional shares of stock of any class or other
rights, or
(4) there shall be any (i) consolidation, merger, reorganization or
other form of acquisition of or by the Company in which the Company's
stockholders immediately prior to the transaction retain less than 50% of
the voting power or economic interest in the surviving or resulting entity
(or its parent) or (ii) the sale of the Company's assets in excess of a
majority of the Company's assets (valued at fair market value as determined
in good faith by the Board of Directors), or
(5) there shall be a voluntary or involuntary dissolution, liquidation
or winding up of the Company;
then, in connection with such event, the Company shall give to the Holder:
(a) at least twenty (20) days' prior written notice of the date on which
the books of the Company shall close or a record shall be taken for
such dividend, distribution or subscription rights or for determining
rights to vote in respect of any such reorganization,
reclassification, consolidation, merger, sale, dissolution,
liquidation or winding up; and
(b) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up,
at least twenty (20) days' prior written notice of the date when the
same shall take place. Such notice in accordance with the foregoing
clause (i) shall also specify, in the case of any such dividend,
distribution or subscription rights, the date on which the holders of
Common Stock shall be entitled thereto, and such notice in accordance
with the foregoing clause (ii) shall also specify the date on which
the holders of Common Stock shall be entitled to exchange their Common
Stock for securities or other property deliverable upon such
reorganization, reclassification consolidation, merger, sale,
dissolution, liquidation or winding up, as the case may be. Each such
written notice shall be given by first class mail, postage prepaid,
addressed to the Holder at the address of the Holder as shown on the
books of the Company.
3.6. Grant, Issue or Sale of Options, Convertible Securities, or Rights. If
at any time or from time to time on or after the date of issuance hereof and
prior to the Expiration Date, the Company shall grant, issue or sell any
Options, Convertible Securities or rights to purchase property (the "Purchase
Rights") pro rata to the record holders of any class of Common Stock and such
grants, issuances or sales do not result in an adjustment of the Purchase Price
under Paragraph 3.1 hereof, then the Holder shall be entitled to acquire (within
thirty (30) days after the later to occur of the initial exercise date of such
Purchase Rights or receipt by such holder of the notice concerning Purchase
Rights to which such Holder shall be entitled under Paragraph 3.5) and upon the
terms applicable to such Purchase Rights either:
(i) the aggregate Purchase Rights which the Holder could have acquired
if it had held the number of shares of Common Stock acquirable upon
exercise
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of this Warrant immediately before the grant, issuance or sale of such
Purchase Rights; provided that if any Purchase Rights were distributed to
holders of Common Stock without the payment of additional consideration by
such holders, corresponding Purchase Rights shall be distributed to the
exercising Holder as soon as possible after such exercise and it shall not
be necessary for the Holder specifically to request delivery of such
rights; or
(ii) in the event that any such Purchase Rights shall have expired or
shall expire prior to the end of said thirty (30) day period, the number of
shares of Common Stock or the amount of property which the Holder could
have acquired upon such exercise at the time or times at which the Company
granted, issued or sold such expired Purchase Rights.
3.7. Adjustment by Board of Directors. If any event occurs as to which, in
the opinion of the Board of Directors, the provisions of this Paragraph 3 are
not strictly applicable or if strictly applicable would not fairly protect the
rights of the Holder in accordance with the essential intent and principles of
such provisions, then the Board of Directors shall make an adjustment in the
application of such provisions, in accordance with such essential intent and
principles, so as to protect such rights as aforesaid, but in no event shall any
adjustment have the effect of increasing the Purchase Price as otherwise
determined pursuant to any of the provisions of this Paragraph 3 except in the
case of a combination of shares of a type contemplated in Paragraph 3.2 and then
in no event to an amount larger than the Purchase Price as adjusted pursuant to
Paragraph 3.2.
3.8. Fractional Shares. The Company shall not issue fractions of shares of
Common Stock upon exercise of this Warrant or scrip in lieu thereof. If any
fraction of a share of Common Stock would, except for the provisions of this
Paragraph 3.8, be issuable upon exercise of this Warrant, the Company shall in
lieu thereof pay to the person entitled thereto an amount in cash equal to such
fraction, calculated to the nearest one-hundredth (1/100) of a share, multiplied
by the New Security Market Price for the Common Stock.
3.9. Officers' Statement as to Adjustments. Whenever the Purchase Price
shall be adjusted as provided in Paragraph 3 hereof, the Company shall forthwith
file at each office designated for the exercise of this Warrant, a statement,
signed by the President, any Vice President or Treasurer of the Company, showing
in reasonable detail the facts requiring such adjustment and the Purchase Price
that will be effective after such adjustment. The Company shall also cause a
notice setting forth any such adjustments to be sent by mail, first class,
postage prepaid, to the record Holder at his or its address appearing on the
stock register. If such notice relates to an adjustment resulting from an event
referred to in Paragraph 3.5, such notice shall be included as part of the
notice required to be mailed and published under the provisions of Paragraph 3.5
hereof.
4. NO DILUTION OR IMPAIRMENT. The Company will not, by amendment of its
certificate of incorporation or through reorganization, consolidation, merger,
dissolution, sale of assets or any other voluntary action, avoid or seek to
avoid the observance or performance of any of the terms of this Warrant, but
will at all times in good faith assist in the carrying out of all such terms and
in the taking of all such action as may be necessary or
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appropriate in order to protect the rights of the Holder against dilution or
other impairment. Without limiting the generality of the foregoing, the Company
will not increase the par value of any shares of stock receivable upon the
exercise of this Warrant above the amount payable therefor upon such exercise,
and at all times will take all such action as may be necessary or appropriate in
order that the Company may validly and legally issue fully paid and
non-assessable stock upon the exercise of this Warrant.
5. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS. The
Company shall at all times reserve and keep available out of its authorized but
unissued stock, solely for the issuance and delivery upon the exercise of this
Warrant and other similar Warrants, such number of its duly authorized shares of
Common Stock as from time to time shall be issuable upon the exercise of this
Warrant and all other similar Warrants at the time outstanding.
6. 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 loss, theft or destruction) upon delivery of an indemnity
agreement (with surety if reasonably required) in an amount reasonably
satisfactory to it, or (in the case of mutilation) upon surrender and
cancellation thereof, the Company will issue, in lieu thereof, a new Warrant of
like tenor.
7. REMEDIES. The Company stipulates that the remedies at law of the Holder
in the event of any default by the Company in the performance of or compliance
with any of the terms of this Warrant may not be adequate, and that the Holders
shall have the right to seek to have the same specifically enforced.
8. NEGOTIABILITY, ETC. This Warrant is issued upon the following terms, to
all of which each taker or owner hereof consents and agrees:
8.1. Subject to (i) the legend appearing on the first page hereof and (ii)
Sections 7.1 and 7.4 of the Purchase Agreement, title to this Warrant may be
transferred by endorsement (by the Holder executing the form of assignment at
the end hereof including guaranty of signature) and delivery in the same manner
as in the case of a negotiable instrument transferable by endorsement and
delivery.
8.2. Any person in possession of this Warrant properly endorsed is
authorized to represent himself as absolute owner hereof and is granted power to
transfer absolute title hereto by endorsement and delivery hereof to a bona fide
purchaser hereof for value; each prior taker or owner waives and renounces all
of his equities or rights in this Warrant in favor of every such bona fide
purchaser, and every such bona fide purchaser shall acquire title hereto and to
all rights represented hereby.
8.3. Until this Warrant is transferred on the books of the Company, the
Company may treat the registered Holder as the absolute owner hereof for all
purposes without being affected by any notice to the contrary.
8.4. Prior to the exercise of this Warrant, the Holder shall not be
entitled to any rights of a shareholder of the Company with respect to shares
for which this Warrant shall be
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exercisable, including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any preemptive rights, and shall
not be entitled to receive any notice of any proceedings of the Company, except
as provided herein.
8.5. The Company shall not be required to pay any Federal or state transfer
tax or charge that may be payable in respect of any transfer involved in the
transfer or delivery of this Warrant or the issuance or conversion or delivery
of certificates for Common Stock in a name other than that of the registered
Holder or to issue or deliver any certificates for Common Stock upon the
exercise of this Warrant until any and all such taxes and charges shall have
been paid by the Holder or until it has been established to the Company's
satisfaction that no such tax or charge is due.
9. TERMINATION OF WARRANT. Upon a termination of the Purchase Agreement in
accordance with its terms, this Warrant shall automatically terminate without
any further action on the part of the Holder or the Company if, at the time of
such termination of the Purchase Agreement, there has been no Initial Closing
(each as defined in the Purchase Agreement) and either (i) the conditions set
forth in Section 6.1(f), 6.2(a) or 6.2(b) of the Purchase Agreement, or (ii) the
conditions set forth in Section 6.1(k) or 6.1(l) of the Purchase Agreement as a
result of a failure to satisfy the condition set forth in paragraph IV(f) of the
Summary of Terms and Conditions attached as Schedule 1.21 to the Purchase
Agreement, shall not have been satisfied or waived.
10. SUBDIVISION OF RIGHTS. This Warrant (as well as any new warrants issued
pursuant to the provisions of this paragraph) is exchangeable, upon the
surrender hereof by the Holder, at the principal office of the Company for any
number of new warrants of like tenor and date representing in the aggregate the
right to subscribe for and purchase the number of shares of Common Stock which
may be subscribed for and purchased hereunder.
11. MAILING OF NOTICES, ETC. All notices and other communications from the
Company to the Holder shall be mailed by first-class 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.
12. HEADINGS, ETC. The headings in this Warrant are for purposes of
reference only, and shall not limit or otherwise affect the meaning hereof.
13. CHANGE, WAIVER, ETC. Neither this Warrant nor any term hereof may be
changed, waived, discharged or terminated orally but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
14. GOVERNING LAW. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE.
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▇▇▇▇▇▇▇, INC.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Dated: June 27, 2003
Attest:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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[To be signed only upon exercise of Warrant]
EXERCISE NOTICE
---------------
▇▇▇▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
The undersigned hereby elects to purchase, pursuant to the provisions of the
Warrant to purchase shares of Common Stock, par value $0.001 per share, issued
by ▇▇▇▇▇▇▇, Inc. and held by the undersigned, the original of which is attached
hereto, and (check the applicable box):
[ ] Tenders herewith payment of the Exercise Payment (as defined in the
Warrant) in full in the form of cash, certified check, official bank check
or wire transfer or check in the amount of $__________________ for
_______________ shares of such securities.
[ ] Confirms that payment of the Exercise Payment (as defined in the Warrant)
in full by means of a wire transfer in the amount of $__________________
for _______________ shares of such securities has been made to the Company.
[ ] Elects to surrender to the Company for cancellation securities of the
Company having Market Price (as defined in the Warrant) on the date hereof
equal to the Exercise Payment for ________ shares of such Common Stock as
to which the Warrant is being exercised.
[ ] Elects to receive that number of shares of Common Stock (valued at the
Market Price on the date hereof) equal to the difference between the Market
Price (as defined in the Warrant), multiplied by the number of shares as to
which the Warrant is being exercised and the Exercise Payment (as defined
in the Warrant) with respect to such shares.
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The undersigned hereby represents and warrants that the undersigned is
acquiring such shares for its own account for investment purposes only, and not
for resale or with a view to distribution of such shares or any part thereof.
The undersigned requests that the certificates for such shares be issued in
the name of, and be delivered to ______________________, whose address is
________________________.
Dated:
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(Signature must conform in all respects to name of Holder as specified on the
face of the Warrant)
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Address
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[To be signed only upon 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 Common Stock of ▇▇▇▇▇▇▇, Inc. to which the
within Warrant relates, and appoints ____________________ attorney to transfer
said right on the books of ▇▇▇▇▇▇▇, Inc, with full power of substitution in the
premises.
Dated:
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(Signature must conform in all respects to name of Holder as specified on the
face of the Warrant)
------------------------------
Address
In the presence of:
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