WARRANT AND WARRANT AGREEMENT TO PURCHASE COMMON STOCK
OF OBJECTSOFT CORPORATION
THESE SECURITIES AND THE SECURITIES ISSUABLE UPON THEIR EXERCISE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED UNLESS
COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT, OR UPON DELIVERY
TO THE ISSUER OF AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER TO THE EFFECT
THAT ANY SUCH TRANSFER IS EXEMPT FROM SUCH REGISTRATION.
In accordance with a settlement agreement between Infusion Capital
Partners, LLC and ObjectSoft Corporation (the "Company") dated the date hereof,
the Company has agreed to issue to INFUSION CAPITAL PARTNERS, LLC (the "Holder")
this warrant to acquire 37,500 shares of the Company's common stock, par value
$.0001 per share (the "Common Stock"), exercisable for three years at $4.87 per
share, pursuant to the terms provided in this Warrant and Warrant Agreement.
This Warrant and Warrant Agreement is hereafter referred to as the "Warrant".
Accordingly, the Company and the Holder agree as follows:
1. Issuance. The Company hereby issues to the Holder the right to
purchase, subject to the provisions of this Warrant, 37,500 shares (the
"Shares") of the Company's Common Stock, at an exercise price of $4.87 per
Share, at any time during the period from and after the date hereof until April
23, 2001 (the "Exercise Period"), and this Warrant shall expire and become void
on the expiration of the Exercise Period. The number of shares of Common Stock
to be received upon the exercise of this Warrant and the exercise price to be
paid for each may be adjusted from time to time as herein set forth. The
securities deliverable pursuant to this Warrant, as they may be adjusted from
time to time, are herein referred to as "Warrant Securities" and the exercise
price for the underlying securities in effect at any time and as adjusted from
time to time is herein referred to as the "Exercise Price".
2. Exercise of Warrants. This Warrant may be exercised as a whole or in
part during the Exercise Period, subject to the above provisions, by
presentation and surrender hereof to the Company at its executive offices with
the purchase form (the "Form") annexed hereto duly executed and accompanied by
payment of the Exercise Price by certified check or wire transfer of immediately
available funds. The Company may, in its sole discretion, permit payment of the
Exercise Price of this Warrant by delivery by the Holder of a properly executed
Form, together with a copy of the Holder's irrevocable instructions to a broker
designated by the Company to deliver promptly to the Company the amount of sale
proceeds sufficient to pay such Exercise Price. In connection therewith, the
Company may enter into agreements for coordinated procedures with one or more
brokerage firms. If this Warrant is exercised in part, the Company will issue to
the Holder a new warrant representing the right of the Holder to purchase the
remaining number of Warrant Securities at the identical terms hereto.
3. Reservation of Shares. The Company hereby agrees that at all times
during the term of this Warrant there shall be reserved for issuance upon
exercise of this Warrant such number of shares of its Common Stock as shall be
required for issuance upon exercise of this Warrant and the exercise of any
convertible securities issuable upon the exercise hereof.
4. Assignment or Loss of Warrant. (a) This Warrant is not assignable or
transferable without the written consent of the Company, except by operation of
law or as provided in (b) below. Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant, and (in the case of loss, theft or destruction) receipt of reasonably
satisfactory indemnification, and (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will execute and deliver a new Warrant
of like tenor and date and any such lost, stolen, destroyed or mutilated Warrant
shall thereupon become void.
(b) This Warrant shall not be transferable by Holder other than to
a "Permitted Transferee" (as defined below); provided, that any Permitted
Transferee shall be absolutely prohibited from transferring all or any portion
of this Warrant other than to Holder or another Permitted Transferee of Holder;
and provided further, that if Holder dies or becomes incapacitated, this Warrant
may be exercised by Holder's estate, legal representative or beneficiary, as the
case may be, subject to all other terms and conditions contained in this
Warrant.
(c) For purposes of this Agreement, Permitted Transferees shall
include only the members of the "immediate family" (which shall be limited to
Holder's spouse, children, and parents) of Holder, and to trusts for such
person's own benefit and/or for the benefit of members of Holder's immediate
family; provided, that such Permitted Transferees must agree in writing to be
bound by all of the terms of this Agreement to the same extent as Holder
hereunder, in form acceptable to counsel to the Company, including but not
limited to restrictions on the exercise of this Warrant and on transfers of the
Shares, as the case may be, following exercise of this Warrant, such that any
Shares so acquired shall be held subject to the terms of this Agreement. Shares
held by any Permitted Transferee shall be aggregated with those held by the
Permitted Transferee's transferor in order to determine the number of Shares
subject to the provisions of this Agreement.
5. Rights of the Holder.
(a) The Holder shall not, by virtue hereof, be entitled to any
rights of a stockholder in the Company, either at law or equity, and the rights
of the Holder are limited to those expressed in this Warrant and are not
enforceable against the Company except to the extent set forth herein.
(b) The Company will use reasonable efforts to register for resale
the shares of Common Stock underlying this Warrant in a registration statement
which may otherwise be filed by the Company on or before October 1, 1998, other
than a registration statement filed in connection with a private financing that
the Company intends to engage in by June 1998 and except that the Company shall
have no such obligation in the event that any investor, underwriter, placement
agent or lender objects to the inclusion of the shares of Common Stock
underlying this Warrant in the
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registration statement. If the Company does not file a registration statement
that includes the shares of Common Stock underlying this Warrant on or before
October 1, 1998, the Holder of this Warrant and all transferees of all or any
portion hereof, acting jointly, shall have the right on one occasion to demand
that the Company file, at the Company's expense, an S-3 registration for the
resale of the shares of Common Stock underlying the Warrant. The foregoing
demand right is applicable only in the event that the closing price of the
Company's stock for five (5) days prior to the demand is greater than $4.87.
6. Protection Against Dilution. (a) If at any time and from time
to time the Company shall (i) declare a dividend in shares of Common Stock to
holder of Common Stock or make a distribution in shares of Common Stock to
holders of Common Stock, (ii) subdivide its outstanding shares of Common Stock,
(iii) combine its outstanding shares of Common Stock or (iv) otherwise effect a
recapitalization of such character that the shares of Common Stock shall be
changed into or become exchangeable for a greater or lesser number of shares of
Common Stock, then the Exercise Price in effect on the record date of such
dividend or distribution or the effective date of such subdivision, combination
or reclassification (individually an "Event" and collectively the "Events")
shall be adjusted, or further adjusted, to a price (to the nearest cent)
determined by multiplying (i) the Exercise Price in effect immediately prior to
such Event by (ii) a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding immediately prior to such Event, and the
denominator of which shall be the number of shares of Common Stock outstanding
immediately after such Event. Upon each adjustment in the Exercise Price
resulting from an Event, the number of Warrant Securities shall be adjusted (to
the nearest one-thousandth share) by multiplying (i) the number of Warrant
Securities for which the Warrant was exercisable immediately prior to such Event
by (ii) a fraction, the numerator of which shall be the Exercise Price in effect
immediately prior to such Event, and the denominator of which shall be the
Exercise Price in effect immediately after such Event. Notice of each such
adjustment and each such readjustment shall be forthwith mailed to the Holder
setting forth such adjustments or readjustments and the facts and calculations
thereof in reasonable detail. Any dividend paid or distributed upon the Common
Stock in stock of any other class of securities convertible into shares of
Common Stock shall be treated as a dividend paid in Common Stock to the extent
that shares of Common Stock are issuable upon the conversion thereof.
(b) In case: (i) a distribution in the form of stock or other
securities of any other corporation or other entity shall be made or paid by the
Company on, or with respect to, the then outstanding shares of Common Stock,
(ii) the Company shall effect a recapitalization of such character that the
shares of Common Stock will be changed into or become exchangeable for shares of
Common Stock with a different par value or no par value, or (iii) the Company
(or a successor corporation) shall be consolidated or merged with or into
another corporation or entity or shall sell, lease or convey all or
substantially all of its assets in exchange for stock or property (including
cash) with the view of distributing such stock or property to its shareholders,
each Share issuable upon exercise of this Warrant shall be replaced by, and/or
shall include, as the case may be, for the purposes hereof, the stock or
property issued or distributed in respect of each share of Common Stock upon
such recapitalization, reclassification, merger, sale, lease or conveyance as
the Holder
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would have been entitled to had the Holder exercised this Warrant and any
underlying convertible security immediately prior to any such occurrence, and
adequate provision to that effect shall be made at the time thereof.
(c) In case: (i) of any classification, reclassification or other
reorganization of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, or the sale, lease or conveyance
of all or substantially all of the assets of the Company; or (ii ) of the
voluntary or involuntary dissolution, liquidation or winding up of the Company;
then, and in any such case, the Company shall mail to the Holder, at least 15
days prior thereto, a notice stating the date or expected date on which a record
is to be taken. Such notice shall also specify the date or expected date, if any
is to be fixed, as of which holders of Common Stock of record shall be entitled
to exchange their shares of Common Stock for securities or other property
deliverable upon such classification, reclassification, reorganization,
consolidation, merger, conveyance, dissolution, liquidation, winding up or any
other appropriate action, as the case may be.
7. Transfer to Comply with the Securities Act. This Warrant has not
been registered under the Securities Act of 1933, as amended (the "Act") and has
been issued to the Holder for investment and not with a view to the distribution
of either the Warrant or the Warrant Securities. Neither this Warrant nor any of
the Warrant Securities or any other security issued or issuable upon exercise of
this Warrant may be sold, transferred, pledged or hypothecated in the absence of
an effective registration statement under the Act relating to such security or
an opinion of counsel satisfactory to the Company that registration is not
required under the Act. Each certificate for the Warrant, the Warrant Securities
and any other security issued or issuable upon exercise of this Warrant shall
contain a legend on the face thereof, in form and substance satisfactory to
counsel for the Company, setting forth the restrictions on transfer contained in
this Section.
8. Notices. Any notice or other communication required or permitted
hereunder shall be in writing and shall be delivered personally, telegraphed,
telexed, sent by facsimile transmission or sent by certified, registered or
express mail, postage pre-paid. Any such notice shall be deemed given when so
delivered personally, telegraphed, telexed or sent by facsimile transmission,
or, if mailed, two days after the date of deposit in the United States mails, as
follows:
(i) if to the Company, to:
OBJECTSOFT CORPORATION
Continental Plaza III
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇, Chairman
(ii) if to the Holder, to:
Infusion Capital Partners, LLC
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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Any party may be notice given in accordance with this Section to the other
parties designate another address or person for receipt of notices hereunder.
9. Supplements and Amendments; Whole Agreement. This Warrant may be
amended or supplemented or any provision hereof waived only by an instrument in
writing signed by the Company and the Holder. This Warrant contains the full
understanding of the parties hereto with respect to the subject matter hereof
and thereof and there are no representations, warranties, agreements or
understandings other than expressly contained herein and therein.
10. Governing Law. This Warrant shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be governed
by and construed in accordance with the laws of such State applicable to
contracts to be made and performed entirely within such State.
11. Counterparts. This Warrant may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
12. Descriptive Headings. Descriptive headings of the several Sections
of this Warrant are inserted for convenience only and shall not control or
affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the 23rd day of April, 1998.
OBJECTSOFT CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇, Chairman
INFUSION CAPITAL PARTNERS, LLC
By: /s/ ▇▇▇▇▇ M.M. Taffett
--------------------------------
Name: ▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇
Title:Chief Executive Officer
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PURCHASE FORM
(To be signed only upon exercise of Warrant)
To ObjectSoft Corporation
The undersigned, the holder of the within Warrant, hereby
irrevocably elects to exercise the purchase right represented by such Warrant
for, and to purchase thereunder, ______________________________ (__________) of
the number of shares (the "Shares") of common stock (the "Common Stock"), par
value $.0001 per share, of ObjectSoft Corporation purchasable under such Warrant
and requests that a certificate(s) for such shares be issued in the name of, and
delivered to, _____________ whose address is______________________________
_________________________. If said number of shares is less than all of the
shares of Common Stock purchasable under the within Warrant, the undersigned
requests that a new Warrant representing the remaining balance of such shares be
registered in the name of _______________, whose address is
_________________________________, and that such Warrant be delivered to
_______________________, whose address is _____________________
_________________________________.
The exercise price for the Shares is $4.87 per Share, for an
aggregate exercise price of $_____________ for all of the Shares. Together with
the delivery of this Purchase Form, the undersigned is:
Please check one:
[_] Tendering to the Company cash or a certified check in the
amount of $_______________, as payment of the exercise price
of the Shares.
[_] Requesting permission from the Company to permit payment of
the exercise price through a sale of Shares by a broker
designated by the Company in accordance with the terms of the
Warrant.
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The undersigned understands that the Shares shall be delivered to
the undersigned promptly after the Company instructs the transfer agent for its
Common Stock to deliver a certificate for the Shares to the undersigned.
The undersigned represents that it is acquiring such shares of
Common Stock for its own account for investment purposes only and not with a
view to or for sale in connection with any distribution thereof.
Dated: ______________ Signature: _______________________________
(Signature must conform in all respects to
name of holder as specified on the face
of the Warrant)
Address: _________________________________
__________________________________________
__________________________________________
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