Exhibit 4.1
No. I-_________________ Warrant to Purchase
________ shares of Common Stock
Dated as of __________, 1999
WARRANT
TO PURCHASE COMMON STOCK OF
TELESPECTRUM WORLDWIDE INC.
THIS CERTIFIES that ______________________________ (the "Holder"), is
entitled to purchase from TeleSpectrum Worldwide Inc., a corporation organized
and existing under the laws of Delaware (the "Company"), at any time after the
first anniversary of the date hereof and until 5:00 P.M. (Eastern Time) on the
seventh anniversary hereof, _______ fully paid and nonassessable shares (the
"Warrant Shares") of Common Stock of the Company, $.001 par value per share (the
"Common Stock"), subject to adjustment as provided herein, at a purchase price
of $6.504 per share (the "Warrant Price").
1. Definitions. As used in this Warrant, the following terms have the
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respective meanings set forth below:
"Appraised Value" means, in respect of any share of Common Stock on any
date herein specified, the value attributable to such share of Common Stock if
all of the assets of the Company and its subsidiaries were sold for the
appraised value thereof as of the last day of a fiscal month to end within 60
days prior to such date specified, and thereafter liquidated in accordance with
the terms of the Company's Certificate of Incorporation, as determined in good
faith by the Board of Directors of the Company.
"Book Value" means, in respect of any share of Common Stock on any date
herein specified, the value attributable to such share of Common Stock if all of
the assets of the Company and its subsidiaries were sold for the consolidated
book value thereof as of the last day of any month immediately preceding such
date, and thereafter liquidated in accordance with the Company's Certificate of
Incorporation, as determined in accordance with generally accepted accounting
principles in the United States.
"Business Day" means any day that is not a Saturday or Sunday or a day on
which banks are required or permitted to be closed in the State of New York.
"Current Market Price" means, in respect of the Common Stock on any date
herein specified, the higher of (a) the Book Value per share of Common Stock at
such date and (b) the Appraised Value per share of Common Stock as at such date,
or if there shall then be a public market for the Common Stock, the higher of
(x) the amount set forth in clause (a) above and (y) the average of the daily
market prices for 30 consecutive Business Days ending 5 days before such date.
The daily market price for each such Business Day shall be (i) the last sale
price on such date on the principal stock exchange or over-the-counter market on
which the Common Stock is then listed or admitted to trading, (ii) if no sale
takes place on such day on any such exchange, the average of the last reported
closing bid and asked prices on such day as officially quoted on any such
exchange, (iii) if the Common Stock is not then listed or admitted to trading on
any stock exchange, the average of the last reported closing bid and asked
prices on such day in the over-the-counter market, as furnished by the National
Association of Securities Dealers Automatic Quotation System or the National
Quotation Bureau, Inc., (or if neither such corporation at the time is engaged
in the business of reporting such prices, as furnished by any similar firm then
engaged in such business or if there is no such firm, as furnished by any member
of the National Association of Securities Dealers, Inc. ("NASD") selected by the
Company).
"Expiration Date" means the date which is the seventh anniversary of the
date of this Warrant.
"Outstanding" means, when used with reference to Common Stock or any class
thereof, at any date as of which the number of shares thereof is to be
determined, all issued shares of Common Stock or of the relevant class, except
shares then owned or held by or for the account of the Company or any subsidiary
thereof, and shall include all shares issuable in respect of outstanding scrip
or any certificates representing fractional interests in shares of Common Stock
or of the relevant class.
2. Exercise of Warrant. This Warrant shall be exercisable at any time
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after the first anniversary of the date hereof until the expiration of the
Warrant as provided in Section 3 hereof, in the manner set forth in Section 4
hereof.
3. Expiration of Warrant. This Warrant, to the extent not exercised,
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shall expire and cease to be of force and effect at 5:00 P.M. (Eastern Time) on
the Expiration Date.
4. Method of Exercise.
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(a) This Warrant may be exercised in whole or in part (but not as to
fractional shares) by the surrender of the Warrant, with the Purchase Agreement
attached hereto as Annex A properly completed and duly executed, at the
principal office of the Company or such other location which at that time shall
be the principal office of the Company (the "Principal Office"), and upon
payment to it of the Warrant Price for each Warrant Share to be purchased upon
such exercise (the aggregate of the Warrant Price for all shares to be exercised
being referred to herein as the "Purchase
Price"). The Purchase Price shall be paid by delivering either (i) a certified
check, bank draft or wire transfer of immediately available funds to the order
of the Company.
(b) In lieu of exercising this Warrant for cash, the Holder may elect
to surrender this Warrant at the Principal Office together with notice of such
election in which event the Company shall issue to the Holder a number of
Warrant Shares computed using the following formula:
X = Y(A-B)
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A
Where X = the number of Warrant Shares to be issued to the Holder
Y = the number of Warrant Shares purchasable under the Warrant
or, if only a portion of the Warrant is being exercised, the
portion of the Warrant being canceled (at the date of
exercise)
A = Current Market Price on the date of exercise
B = Warrant Price (as adjusted on the date of exercise).
(c) The Holder shall be treated for all purposes as the holder of the
Warrant Shares as of the close of business on the date of exercise, and
certificates for the Warrant Shares so purchased shall be delivered to the
person so entitled, properly endorsed for transfer or accompanied by appropriate
stock powers, within a reasonable time, not exceeding five days, after such
exercise. Unless this Warrant shall have expired, a new Warrant of like tenor
and for such number of Warrant Shares as the Holder shall direct, representing
in the aggregate the right to purchase that number of Warrant Shares with
respect to which this Warrant shall not have been exercised, shall also be
issued to the Holder within such time.
5. Certain Covenants. The Company shall cause all Warrant Shares to be
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listed on each national securities exchange or securities quotation system, if
any, on which the other outstanding shares of Common Stock of the Company are
then listed or quoted. The Company shall (i) use its reasonable best efforts to
comply with the current public information requirements of Rule 144 ("Rule 144")
under the 1933 Act and (ii) at all times Rule 144 is available for use by
▇▇▇▇▇▇, furnish the Holder upon request with all information within the
possession of the Company required for the preparation and filing of Rule 144.
6. Adjustment of Purchase Price and Number of Shares. The number of
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shares of Common Stock purchasable upon the exercise of this Warrant and/or the
Exercise Price shall be subject to adjustment from time to time upon the
happening of certain events as follows:
6.1 Stock Dividends, Subdivisions or Combinations. If the Company at any
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time while the Warrant remains outstanding and unexpired shall:
(a) subdivide its outstanding shares of Common Stock into a larger
number of shares of Common Stock,
(b) combine its outstanding shares of Common Stock into a smaller
number of shares of Common Stock, or
(c) pay a dividend or make a distribution in shares of its Common
Stock,
then the number of shares of Common Stock purchasable upon the exercise of this
Warrant immediately after the occurrence of any such event shall be adjusted to
equal the number of shares of Common Stock that a record holder of the same
number of shares of Common Stock represented by this Warrant immediately prior
to the occurrence of such event would own or be entitled to receive after the
happening of such event and the Warrant Price shall be proportionately adjusted
such that the aggregate exercise price of this Warrant remains unchanged.
6.2 Reclassification, Consolidation or Merger. At any time while this
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Warrant remains outstanding and unexpired, in case of any reclassification or
change of outstanding securities issuable upon exercise of this Warrant (other
than a change in par value, or from par value to no par value, or from no par
value to par value or as a result of an event described in Sections 6.1(a) or
(b) above) or in case of any consolidation or merger of the Company with or into
another corporation (other than a merger with another corporation in which the
Company is a continuing corporation and which does not result in any
reclassification or change, other than a change in par value, or from par value
to no par value, or from no par value to par value), or in the case of any sale
or transfer to another corporation of the property of the Company as an entirety
or substantially as an entirety, the Company shall, without payment of any
additional consideration therefor, execute a new Warrant providing that the
Holder shall have the right to exercise such new Warrant (upon terms not less
favorable to the Holder than those then applicable to this Warrant) and to
receive upon such exercise, in lieu of each share of Common Stock of the Company
theretofore issuable upon exercise of this Warrant, the kind and amount of
shares of stock, other securities, money or property receivable upon such
reclassification, change, consolidation, merger, sale or transfer by the Holder
of one share of Common Stock issuable upon exercise of this Warrant had this
Warrant been exercised immediately prior to such reclassification, change,
consolidation, merger, sale or transfer. Such new Warrant shall provide for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 6. The provisions of this Section 6.2
shall similarly apply to successive reclassification, changes, consolidations,
mergers, sales and transfers.
6.3 Liquidating Dividends, Etc. If the Company at any time while this
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Warrant remains outstanding and unexpired makes a distribution of its assets to
the holders of its Common Stock as a dividend in liquidation or by way of return
of capital or other than as a dividend payable out of earnings or surplus
legally available for dividends under applicable law or any distribution to such
holders made in respect of the sale of all or substantially all of the Company's
assets (other than under the circumstances otherwise provided for in this
Section 6), the holder of this Warrant shall be entitled to receive upon the
exercise hereof, in addition to the shares of Common Stock receivable upon such
exercise, and without payment of any consideration other than the Warrant Price,
an amount in cash equal to the value of such distribution per share of Common
Stock multiplied by the number of shares of Common Stock which, on the record
date for such distribution, are issuable upon exercise of this Warrant (with no
further adjustment being made following any event which causes a subsequent
adjustment in the number of shares of Common Stock issuable upon the exercise
hereof), and an appropriate provision therefor should be made a part of any such
distribution. The value of a distribution which is paid in other than cash shall
be determined in good faith by the Company's Board of Directors.
6.4 Other Action Affecting Common Stock. If after the date hereof the
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Company shall take any action affecting the outstanding number of shares of
Common Stock, other than an action described in any of the foregoing subsections
of Section 6 hereof, inclusive, that would have a materially adverse effect upon
the rights of the Holder, the Warrant Price shall be adjusted in such manner and
at such time as the Board of Directors on the advice of the Company's
independent public accountants may in good faith determine to be equitable in
the circumstances.
6.5 Other Provisions Applicable to Adjustment under this Section. The
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following provisions shall be applicable to the making of any adjustment of the
number of shares of Common Stock issuable upon exercise of this Warrant provided
for in this Section 6:
(a) When Adjustments to Be Made. The adjustments required by this
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Section 6 shall be made whenever and as often as any specified event
requiring an adjustment shall occur, except that any adjustment of the
number of shares of Common Stock issuable upon exercise of the Warrant that
would otherwise be required may be postponed (except in the case of a
subdivision or combination of shares of the Common Stock, as provided for
in Section 6.1) up to, but not beyond the date of exercise if such
adjustment either by itself or with other adjustments not previously made
adds or subtracts less than 1% of the shares of Common Stock issuable upon
exercise of the Warrant immediately prior to the making of such adjustment.
Any adjustment representing a change less than such minimum amount (except
as aforesaid) which is postponed shall be carried forward and made as soon
as such adjustment, together with other adjustments required by this
Section 6 and not previously made, would result in a minimum adjustment or
on the
date of exercise. For the purpose of any adjustment, any specified
event shall be deemed to have occurred at the close of business on the
date of its occurrence.
(b) When Adjustment Not Required. If the Company shall take a
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record of the holders of its Common Stock for the purpose of entitling
them to receive a dividend or distribution or subscription or purchase
rights and shall, thereafter and before the distribution to
stockholders thereof, legally abandon its plan to pay or deliver such
dividend, distribution, subscription or purchase rights, then
thereafter no adjustment shall be required by reason of the taking of
such record and any such adjustment previously made in respect thereof
shall be rescinded and annulled.
(c) Escrow of Warrant Stock. If after any property becomes
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distributable pursuant to this Section 6 by reason of the taking of
any record of the holders of Common Stock, but prior to the occurrence
of the event for which such record is taken, and the Holder exercises
this Warrant, any additional shares of Common Stock obtainable upon
exercise by reason of such adjustment shall be deemed the last shares
of Common Stock for which this Warrant is exercised (notwithstanding
any other provision to the contrary herein) and such shares or other
property shall be held in escrow for the Holder by the Company to be
transferred to the Holder upon and to the extent that the event
actually takes place, upon payment of the Warrant Price.
Notwithstanding any other provision to the contrary herein, if the
event for which such record was taken fails to occur or is rescinded,
then such escrowed shares shall be canceled by the Company and
escrowed property returned.
7. Notice of Adjustments. Whenever the number of shares of Common Stock
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issuable upon exercise of this Warrant shall be adjusted pursuant to Section 6
hereof, the Company shall promptly notify the Holder in writing of such
adjustment, setting forth in reasonable detail the event requiring the
adjustment, the amount of the adjustment, the method by which such adjustment
was calculated (including a description of the basis on which the Company's
Board of Directors made any determination hereunder), and the number of shares
of Common Stock obtainable upon exercise of this Warrant and any change in the
Warrant Price after giving effect to such adjustment. Such notice shall be
mailed (by first class and postage prepaid) to the Holder.
8. Voting. The Holder shall not have any voting rights with respect to
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the Warrant Shares until the exercise of this Warrant, and thereafter, the
Holder shall have all voting rights with respect to the Warrant Shares for which
exercise is made hereunder.
9. Representations and Warranties of the Company. The Company hereby
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represents and warrants to the Holder as follows:
(a) This Warrant has been duly authorized by all necessary corporate
action on the part of the Company and has been duly executed by a duly
authorized officer of the Company and constitutes a valid and binding obligation
of the Company.
(b) Neither the execution and delivery of this Warrant, nor the
consummation of the transactions contemplated hereby, will violate or result in
any violation of or be in conflict with or constitute a default under any term
of the charter or bylaws of the Company or of any agreement, instrument,
judgment, decree, order, statute, rule or governmental regulation applicable to
the Company.
(c) Upon exercise of this Warrant and payment of the Warrant Price
for each Warrant Share by the Holder, the Warrant Shares will be duly issued,
fully paid and nonassessable shares of Common Stock and free from all taxes,
liens and changes with respect to the issuance thereof.
10. Loss, Theft, Destruction or Mutilation. Upon receipt by the Company of
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evidence reasonably satisfactory to it that this Warrant has been mutilated,
destroyed, lost or stolen, and in the case of any destroyed, lost or stolen
Warrant, a bond of indemnity reasonably satisfactory to the Company, or in the
case of a mutilated Warrant, upon surrender and cancellation thereof, the
Company will execute and deliver in the Holder's name, in exchange and
substitution for the Warrant so mutilated, destroyed, lost or stolen, a new
Warrant of like tenor substantially in the form thereof with appropriate
insertions and variations.
11. Successors and Assigns. This Warrant and the rights evidenced hereby
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shall inure to the benefit of and be binding upon the successors of the Company
and the Holder.
12. Amendment. This Warrant may be modified with the written consent of
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the Company and the Holder.
13. Transferability. Except for a "Permitted Transfer", no holder may
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Transfer this Warrant or, prior to the exercise of this Warrant (and then only
to the extend of such exercise), any Warrant Shares issuable upon exercise of
this Warrant. A "Permitted Transfer" means any Transfer to (a) the spouse or
children of a holder or a trust or fiduciary that acts for the benefit of any
such spouse or children, in either case, for bona fide family planning purposes,
(b) the personal representative or estate of a deceased holder if such Transfer
is made pursuant to a will or other estate-related Transfer at the time of death
or (c) with respect to any holder that is a partnership, to any direct or
indirect owner of any partnership interest therein. A "Transfer" means any
actual or proposed disposition of all or a portion of an interest (legal or
equitable) by any means, direct or indirect, absolute or conditional, voluntary
or involuntary, including by sale, assignment, transfer, pledge, hypothecation,
mortgage or other encumbrance, court order, operation of law, distribution,
settlement, exchange, waiver, abandonment, gift, alienation, bequest or
disposal.
14. Injunctive Relief. It is acknowledged that it will be impossible to
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measure the damages that would be suffered by a party if another party fails to
comply with the provisions hereof and that in the event of any such failure,
each non-breaching party may not have an adequate remedy at law. Therefore, any
party shall be entitled to obtain specific performance of another party's
obligations hereunder and to obtain injunctive relief. No party shall argue, as
a defense to any proceeding for such specific performance or injunctive relief,
that another party has no adequate remedy at law.
15. Headings. The descriptive headings of the several sections of this
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Warrant are inserted for convenience only and do not constitute a part of this
Warrant.
16. Governing Law. This Warrant shall be governed by the laws of the State
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of Delaware without regard to the provisions thereof relating to conflict of
laws.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its
duly authorized officer, attested by its duly authorized officer, on the date of
this Warrant.
TELESPECTRUM WORLDWIDE INC.
By:
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Annex A
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PURCHASE AGREEMENT
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Date:
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TO: TeleSpectrum Worldwide Inc.
(1) The undersigned, pursuant to the provisions set forth in the attached
Warrant, hereby irrevocably agrees to purchase _______ shares of Common Stock
covered by such Warrant, and makes payment herewith in full therefor at the
price per share of $6.504 provided by this Warrant.
(2) The undersigned, pursuant to the provisions set forth in the attached
Warrant, hereby irrevocably elects to make a Cashless Exercise, as provided for
in Section 4 of such Warrant, with respect to _________ Warrant Shares,
_________ Warrant Shares of which shall be retained by the Company in payment of
the Purchase Price (as defined in the Warrant).
Signature:
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Address:
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