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EXHIBIT 10.2
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR THE LAWS OF ANY STATE, AND THIS WARRANT HAS BEEN ISSUED OR
SOLD IN RELIANCE UPON EXEMPTIONS FROM REGISTRATION UNDER THE SECURITIES ACT AND
PARAGRAPH (13) OF CODE SECTION 10-5-9 OF THE GEORGIA SECURITIES ACT OF 1973.
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF
MAY NOT BE OFFERED FOR SALE, SOLD OR TRANSFERRED UNTIL (I) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR SUCH APPLICABLE STATE SECURITIES LAWS
SHALL HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (II) THE COMPANY RECEIVES
AN OPINION OF COUNSEL IN A FORM ACCEPTABLE TO THE COMPANY STATING THAT
REGISTRATION UNDER THE SECURITIES ACT OR SUCH APPLICABLE STATE SECURITIES LAWS
IS NOT REQUIRED IN CONNECTION WITH SUCH PROPOSED OFFER, SALE OR TRANSFER.
HIE, INC.
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STOCK PURCHASE WARRANT
COMMON STOCK
Par Value $.01 Per Share
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THIS STOCK PURCHASE WARRANT (the "Warrant") is issued this 21st day of
December, 1999, by HIE, INC., a Georgia corporation (the "Company"), to CYBEAR,
INC., a Delaware corporation ("Cybear," which, together with any permitted
assignee or transferee hereunder, is hereinafter referred to collectively as
"Holder" or "Holders").
1. Issuance of Warrant. For good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company hereby
grants to Holder the right to purchase 47,022 shares of the Company's common
stock, $.01 par value per share (the "Common Stock"), at the purchase price per
share (the "Exercise Price") set forth herein. The shares of Common Stock
issuable upon exercise of this Warrant are hereinafter referred to as the
"Warrant Shares." The number of Warrant Shares and the Exercise Price are
subject to adjustment as provided in Section 9 below.
2. Term. Subject to the terms and conditions set forth herein, this
Warrant shall be exercisable by Holder in whole or in part at any time and from
time to time from the date hereof until 5:00 p.m. Atlanta, Georgia time on
December 21, 2004 (the "Expiration Date") and shall be void thereafter.
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3. Price. The Exercise Price per share for which the Warrant Shares
may be purchased pursuant to the terms of this Warrant shall be $3.19 per
share, as adjusted from time to time pursuant to Section 9 hereof.
4. Exercise of Warrant.
(a) Exercise. This Warrant may be exercised by the Holder
hereof (but only on the conditions hereinafter set forth) as to all or any
increment or increments of One Thousand (1,000) Warrant Shares by surrender of
this Warrant and the Notice of Exercise attached hereto as Exhibit A, duly
completed and executed on behalf of the Holder, at the office of the Company,
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other
address as the Company shall designate in a written notice to the Holder
hereof, together with a check acceptable and payable to the Company in the
amount of the Exercise Price times the number of Warrant Shares being purchased
pursuant to such exercise.
(b) Cashless Exercise. In lieu of exercising the Warrant
by payment of the Exercise Price in cash pursuant to Section 4(a) above, the
Holder shall have the right to require the Company to convert the Warrant, in
whole or in part and at any time or times (the "Conversion Right"), into
Warrant Shares, by surrender to the Company of this Warrant and the Notice of
Exercise attached hereto as Exhibit A, duly completed and executed by the
Holder to evidence the exercise of the Conversion Right. Upon exercise of the
Conversion Right, the Company shall deliver to the Holder (without payment by
the Holder of any cash in respect of the Exercise Price) a certificate(s)
representing that number of Warrant Shares which is equal to the quotient
obtained by dividing (x) the value of the number of Warrants being converted at
the date the Conversion Right is exercised (determined by subtracting (A) the
aggregate Exercise Price for all such Warrants immediately prior to the
exercise of the Conversion Right from (B) the aggregate Fair Market Value
(determined on the basis of the Fair Market Value per share of Common Stock
multiplied by that number of Warrant Shares purchasable upon exercise of such
Warrants immediately prior to the exercise of the Conversion Right)), by (y)
the Fair Market Value per share of Common Stock on the date of exercise of the
Conversion Right. For purposes of this calculation, the Fair Market Value per
share of Common Stock shall be (i) if a public market for the Company's Common
Stock exists at the time of such exercise, the average of the closing bid and
asked prices of the Common Stock quoted in the Over-The-Counter Market Summary
or the last reported sales price of the Common Stock or the closing price
quoted on the Nasdaq National Market or on any exchange on which the Common
Stock is listed, whichever is applicable, as published in The Wall Street
Journal for the five (5) trading days prior to the date of determination of
Fair Market Value; or (ii) if there is no public market for the Company's
Common Stock, determined by the Company's Board of Directors in good faith. Any
references in this Warrant to the "exercise" of any Warrants, and the use of
the term "exercise" herein, shall be deemed to include (without limitation) any
exercise of the Conversion Right.
(c) Delivery of Stock Certificates. Upon exercise of this
Warrant as aforesaid, the person entitled to receive the Warrant Shares
issuable upon such exercise shall be treated for
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all purposes as the holder of record of such shares as of the close of business
on the date of exercise. As promptly as practicable on or after such date, and
in any event within ten (10) days thereafter, the Company shall execute and
deliver to the Holder of this Warrant a certificate or certificates for the
total number of whole Warrant Shares for which this Warrant is being exercised
(net of any Warrant Shares applied upon exercise of the Conversion Right), in
such names and denominations as are requested by such Holder. If this Warrant
shall be exercised with respect to less than all of the Warrant Shares, the
Company, at its expense, will issue to the Holder a new Warrant covering the
number of Warrant Shares with respect to which this Warrant shall not have been
exercised, which new Warrant shall be identical to this Warrant except for the
number of shares remaining subject to the Warrant. If, upon exercise of this
Warrant, the Holder would be entitled to acquire a fractional share of the
Company's Common Stock, such fractional share shall be disregarded and the
number of shares subject to this Warrant shall be rounded down to the next
lower number of shares and the Holder shall be entitled to receive from the
Company a cash payment equal to the product of the per share Exercise Price
multiplied by such fraction rounded to the nearest ▇▇▇▇▇.
(d) Payment of Taxes. The Company will pay all documentary
stamp taxes attributable to the initial issuance of Warrant Shares upon the
exercise of this Warrant, provided that such certificates for such Warrant
Shares are issued in the name of Cybear. The Company shall not be required to
pay any tax or taxes which may be payable in respect of any other transfer
involved in the issue of any certificates for Warrant Shares and the Company
shall not be required to issue or deliver such certificates for Warrant Shares
unless or until the person or persons requesting the issuance thereof shall
have paid to the Company the amount of such tax or shall have established to
the satisfaction of the Company that such tax has been paid.
5. Covenants and Conditions. The above provisions are subject to
the following:
(a) The Holder of this Warrant and any transferee hereof
or of the Warrant Shares issuable upon exercise of this Warrant, by their
acceptance hereof or thereof, hereby (i) acknowledge that this Warrant has
been, and any Warrant Shares issuable upon exercise hereof will be, acquired
for investment purposes and not with a view to distribution or resale and (ii)
understand and agree that this Warrant and the Warrant Shares issuable upon the
exercise hereof, have not been registered under the Securities Act or any
applicable state securities laws ("Blue Sky Laws"), and may not be sold,
pledged, hypothecated or otherwise transferred without (A) an effective
registration statement for such Warrant under the Securities Act and such
applicable Blue Sky Laws, or (B) an opinion of counsel reasonably satisfactory
to the Company that registration is not required under the Securities Act or
under any applicable Blue Sky Laws. Transfer of the Warrant Shares issued upon
the exercise of this Warrant shall be restricted in the same manner and to the
same extent as the Warrant. Each Warrant and each certificate representing such
Warrant Shares shall bear substantially the following legend (with such changes
therein as may be appropriate to reflect whether such legend refers to a
Warrant or Warrant Shares):
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE
UPON THE EXERCISE HEREOF HAVE NOT BEEN
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REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT") OR THE LAWS OF ANY
STATE, AND THIS WARRANT HAS BEEN ISSUED OR SOLD IN
RELIANCE UPON EXEMPTIONS FROM REGISTRATION UNDER THE
SECURITIES ACT AND PARAGRAPH (13) OF CODE SECTION
10-5-9 OF THE GEORGIA SECURITIES ACT OF 1973. THIS
WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON
THE EXERCISE HEREOF MAY NOT BE OFFERED FOR SALE,
SOLD OR TRANSFERRED UNTIL (I) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR SUCH
APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (II) THE COMPANY
RECEIVES AN OPINION OF COUNSEL IN A FORM ACCEPTABLE
TO THE COMPANY STATING THAT REGISTRATION UNDER THE
SECURITIES ACT OR SUCH APPLICABLE STATE SECURITIES
LAWS IS NOT REQUIRED IN CONNECTION WITH SUCH
PROPOSED OFFER, SALE OR TRANSFER.
(b) The Holder and the Company agree to execute such
documents and instruments as counsel for the Company reasonably deems necessary
to effect the compliance of the issuance of the Warrant and any Warrant Shares
with applicable federal and state securities laws, including compliance with
applicable exemptions from the registration requirements of such laws.
(c) The Company covenants and agrees that all Warrant
Shares which may be issued upon exercise of this Warrant will, upon issuance
and payment therefor, be legally and validly issued and outstanding, fully paid
and nonassessable. The Company shall at all times reserve and keep available
for issuance upon the exercise of this Warrant such number of authorized shares
of Common Stock as will be sufficient to permit the exercise in full of this
Warrant.
6. Registration Rights. The nonpublic Warrant Shares issuable upon
exercise of this Warrant are entitled to certain registration rights upon the
terms and conditions set forth in a Registration Rights Agreement, dated as of
December 21, 1999 between the Company and Cybear.
7. Transfer. Subject to the restrictions set forth in Section 5 of
this Warrant, Holder may transfer or assign this Warrant. Upon a transfer in
accordance with this Section 7, the Company at its expense (excluding any
applicable transfer taxes) shall execute and deliver, in lieu of and in
replacement of this Warrant, Warrants identical in form to this Warrant and in
such denominations as the transferring Holder shall request; provided that, any
such transferee, by acceptance hereof, agrees to assume all of the obligations
of Holder and be bound by all of the terms and provisions of this Warrant.
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8. Warrant Holder Not Shareholder. This Warrant does not confer
upon the Holder, as such, any right whatsoever as a shareholder of the Company.
9. Adjustment Upon Changes in Company Common Stock. The number of
shares of Common Stock subject to this Warrant and the Exercise Price per share
of such shares shall be adjusted by the Company proportionately to reflect
changes in the capitalization of the Company as a result of any
recapitalization, reclassification, stock dividend, stock split, combination of
shares, exchange of shares or any other change in the Company's capital
structure which affects holders of Common Stock generally. All adjustments
described herein shall be reflected on the Company's stock warrant ledger and
the Holder shall receive written notice thereof.
10. Merger, Sale of Assets, etc. If at any time while this Warrant,
or any portion thereof, is outstanding and unexpired, there shall be (a) a
reorganization (other than a combination, reclassification, exchange or
subdivision of shares otherwise provided for in Section 9 hereof), (b) a merger
or consolidation of the Company with or into another corporation in which the
Company is not the surviving entity, or a reverse triangular merger in which
the Company is the surviving entity but the shares of the Company's capital
stock outstanding immediately prior to the merger are converted by virtue of
the merger into other property, whether in the form of securities, cash or
otherwise, or (c) a sale or transfer of the Company's properties and assets as,
or substantially as, an entirety to any other person, then, as a part of such
reorganization, merger, consolidation, sale or transfer, lawful provision shall
be made so that the holder of this Warrant shall thereafter be entitled to
receive upon exercise of this Warrant, during the period specified herein and
upon payment of the Exercise Price then in effect, the number of shares of
stock or other securities or property of the successor corporation resulting
from such reorganization, merger, consolidation, sale or transfer that a holder
of the shares deliverable upon exercise of this Warrant would have been
entitled to receive in such reorganization, consolidation, merger, sale or
transfer if this Warrant had been exercised immediately before such
reorganization, merger, consolidation, sale or transfer, all subject to further
adjustment for other future events as provided in Section 9. The foregoing
provision of this Section 10 shall similarly apply to successive
reorganizations, consolidations, mergers, sales and transfers and to the stock
or securities of any other corporation that are at the time receivable upon the
exercise of this Warrant. If the per share consideration payable to the holder
hereof for shares in connection with any such transaction is in a form other
than cash or marketable securities, then the value of such consideration shall
be determined in good faith by the Company's Board of Directors. In all events,
appropriate adjustments (as determined in good faith by the Company's Board of
Directors) shall be made in the application of the provisions of this Warrant
with respect to the rights and interests of the Holder after the transaction,
to the end that the provisions of this Warrant shall be applied after that
event, as nearly as reasonably may be, in relation to any shares or other
property deliverable after that event upon exercise of this Warrant.
11. Certain Distributions. If the Company shall, at any time or from
time to time, fix a record date for the distribution to all holders of Common
Stock (including any such distribution made in connection with a consolidation
or merger in which the Company is the continuing corporation) of evidences of
indebtedness, assets or other property (other than regularly scheduled cash
dividends or cash distributions payable out of consolidated earnings or earned
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surplus or dividends payable in capital stock) or subscription rights, options
or warrants, then the Exercise Price shall be reduced to the price determined
by multiplying the Exercise Price in effect immediately prior to such record
date by a fraction (which shall in no event be less than zero), the numerator
of which shall be the fair market value per share of Common Stock on such
record date, less the fair market value (as determined in good faith by the
Board of Directors of the Company) of the portion of the assets, evidences of
indebtedness, other property, subscription rights or warrants so to be
distributed applicable to one share of Common Stock and the denominator of
which shall be such fair market value per share of Common Stock. Any such
adjustment shall become effective immediately after the record date for such
distribution. Such adjustment shall be made successively whenever such a record
date is fixed. In the event that such distribution is not so made, the Exercise
Price shall be adjusted to the Exercise Price in effect immediately prior to
such record date (subject to any other applicable adjustment).
12. Notice of Certain Events. In case:
(a) the Company shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive any dividend or other
distribution, or any right to subscribe for or purchase any shares of capital
stock of any class, or to receive any other rights; or
(b) of any capital reorganization, any reclassification of
shares of capital stock of the Company (other than a subdivision or combination
of outstanding shares of Common Stock to which Section 9 applies), or any
consolidation or merger of the Company or the sale or transfer of all or
substantially all of the assets of the Company; or
(c) of any voluntary dissolution, liquidation, or winding
up of the Company;
then the Company shall mail (at least ten (10) days prior to the applicable
date referred to in subclause (x) or in subclause (y) below, as the case may
be), to the Holder at the address set forth in the Company's stock records, a
notice stating that (x) the date on which a record is to be taken for the
purpose of such dividend, distribution or rights or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be
entitled to such dividend, distribution or rights are to be determined, or (y)
the date on which such reclassification, capital reorganization, consolidation,
merger, sale, transfer, dissolution, liquidation or winding up is expected to
become effective, and, if applicable, the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities or other property deliverable upon such
reclassification, capital reorganization, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up.
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IN WITNESS WHEREOF, HIE, Inc. has caused this Warrant to be executed
by its duly authorized officer on the date first above written.
HIE, INC.
By:
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
Accepted:
CYBEAR, INC.
By:
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title:Executive Vice President and
Chief Financial Officer
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EXHIBIT A
NOTICE OF EXERCISE
To: HIE, INC.
The undersigned, the holder of the foregoing Warrant, and pursuant to
the terms hereof, hereby elects to exercise rights represented by said Warrant
for, and to purchase thereunder, _________ shares of the Company's Common Stock
covered by said Warrant, and tenders herewith payment of the purchase price in
full for such shares by:
_____ (a) cash in the amount of $__________, through the
delivery of a certified or official bank check; or
_____ (b) exercising the Conversion Right provided under
Section 4(b) of the Warrant by the surrender of said
Warrant.
The undersigned hereby requests that certificates for such shares (or
any other securities or other property issuable upon such exercise) be issued
in the name of and delivered to the undersigned at the address set forth below.
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Name
Date:
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Signature
Address:
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