EXHIBIT 10.11
NEITHER THIS WARRANT NOR THE COMMON STOCK WHICH MAY BE ACQUIRED UPON EXERCISE
HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
("ACT"), OR UNDER ANY STATE SECURITIES LAW AND MAY NOT BE PLEDGED, SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
WITH RESPECT THER ETO UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAW, OR
UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY,
THAT SUCH REGISTRATION IS NOT REQUIRED. THE COMPANY'S SUBSCRIPTION AGREEMENT
WITH THE HOLDER CONTAINS ADDITIONAL PROVISIONS RESTRICTING THE TRANSFER OF THIS
WARRANT. A COPY OF SUCH AGREEMENT IS AVAILABLE FOR INSPECTION AT THE COMPANY'S
OFFICE.
For the Purchase of
No._______________ ________ shares of
Common Stock
CLASS B WARRANT FOR THE PURCHASE OF
SHARES OF COMMON STOCK
OF
AUGMENT SYSTEMS, INC.
(A DELAWARE CORPORATION)
Augment Systems, Inc., a Delaware corporation ("Company"), hereby certifies
that ________________, or his, her or its registered assigns ("Registered
Holder"), is entitled, subject to the terms set forth below, to purchase from
the Company, at any time or from time to time during the period commencing
December 1, 1997 ("Commencement Date") and ending on November 30, 2000
("Expiration Date"), ______ shares of Common Stock, $.01 par value, of the
Company ("Common Stock"), at an initial exercise price equal to $1.00 per share
(subject to adjustment as provided below); provided, however, that if the
Company consummates an initial public offering of its securities ("IPO") by May
30, 1997, then the per-share exercise price of the Warrant shall be adjusted to
be equal to three-fourths of the offering price of a share of Common Stock in
the IPO. The number of shares of Common Stock purchasable upon exercise of this
Warrant, and the exercise price per share, each as adjusted from time to time
pursuant to the provisions of this Warrant, are hereinafter referred to as the
"Warrant Stock" and the "Exercise Price," respectively.
1. Exercise.
(a) This Warrant may be exercised by the Registered Holder, in whole
or in part, by surrendering this Warrant, with the purchase form appended hereto
as Exhibit I duly executed by such Registered Holder, at the principal office of
the Company, or at such other office or agency as the Company may designate,
accompanied by payment in full, in lawful money of the United States, of the
Exercise Price payable in respect of the number of shares of Warrant Stock being
purchased upon such exercise.
(b) Each exercise of this Warrant shall be deemed to have been
effected immediately prior to the close of business on the day on which the
Warrant shall have been surrendered to the Company as provided in subsection
1(a) above. At such time, the person or persons in whose name or names any
certificates for Warrant Stock shall be issuable upon such exercise as provided
in subsection 1(c) below shall be deemed to have become the holder or holders of
record of the Warrant Stock represented by such certificates.
(c) As soon as practicable after the exercise of this Warrant in full
or in part, and in any event within 10 days thereafter, the Company at its
expense will cause to be issued in the name of, and delivered to, the Registered
Holder, or, subject to the terms and conditions hereof, as such Holder (upon
payment by such Holder of any applicable transfer taxes) may direct:
(i) a certificate or certificates for the number of full shares
of Warrant Stock to which such Registered Holder shall be entitled upon
such exercise, and
(ii) in case such exercise is in part only, a new warrant or
warrants (dated the date hereof) of like tenor, calling in the aggregate on
the face or faces thereof for the number of shares of Warrant Stock equal
(without giving effect to any adjustment therein) to the number of such
shares called for on the face of this Warrant, minus the number of such
shares purchased by the Registered Holder upon such exercise as provided in
subsection 1(a) above.
(d) In lieu of the payment of the Exercise Price in the manner
required by Section 1(a), the Holder shall have the right (but not the
obligation) to pay the Exercise Price for the shares of Common Stock being
purchased with this Warrant upon exercise by the surrender to the Company of any
exercisable but unexercised portion of this Warrant having a "Value" (as defined
below), at the close of trading on the last trading day immediately preceding
the exercise of this Warrant, equal to the Exercise Price multiplied by the
number of shares of Common Stock being purchased upon exercise ("Cashless
Exercise Right"). The sum of (x) the number of shares of Common Stock being
purchased upon exercise of the non-surrendered portion of this Warrant pursuant
to this Cashless Exercise Right and (y) the number of shares of Common Stock
underlying the portion of this Warrant being surrendered, shall not in
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any event be greater than the total number of shares of Common Stock purchasable
upon the complete exercise of this Warrant if the Exercise Price were paid in
cash. The "Value" of the portion of the Warrant being surrendered shall equal
the remainder derived from subtracting (x) the Exercise Price multiplied by the
number of shares of Common Stock underlying the portion of this Warrant being
surrendered from (y) the Market Price of a share of Common Stock multiplied by
the number of shares of Common Stock underlying the portion of this Warrant
being surrendered. As used in this Warrant, the term "Market Price" at any date
shall be deemed to be the last reported sale price of the Common Stock on such
date, or, in case no such reported sale takes place on such day, the average of
the last reported sale price for the immediately preceding three trading days,
in either case as officially reported by the national securities exchange on
which the Common Stock is trading, or, if the Common Stock is not principally
traded on any national securities exchange, the last reported sale price as
furnished by the NASD through the Nasdaq National Market or SmallCap Market, or,
if applicable, the OTC Bulletin Board, or if the Common Stock is not listed or
admitted to trading on the Nasdaq National Market or SmallCap Market or OTC
Bulletin Board or similar organization, as determined in good faith by
resolution of the Board of Directors of the Company, based on the best
information available to it. The Cashless Exercise Right may be exercised by the
Holder on any business day on or after the Commencement Date and not later than
the Expiration Date by delivering the Warrant with a duly executed exercise form
attached hereto with the cashless exercise section completed to the Company,
exercising the Cashless Exercise Right and specifying the total number of shares
of Common Stock being purchased pursuant to such Cashless Exercise Right.
2. Adjustments to Exercise Price and Number of Securities.
(a) If the outstanding shares of the Company's Common Stock shall be
subdivided or split into a greater number of shares, or a dividend in Common
Stock shall be paid in respect of Common Stock, the Exercise Price in effect
immediately prior to such subdivision or at the record date of such dividend
shall simultaneously with the effectiveness of such subdivision or split or
immediately after the record date of such dividend be proportionately reduced.
If the outstanding shares of Common Stock shall be combined or reverse-split
into a smaller number of shares, the Exercise Price in effect immediately prior
to such combination or reverse-split shall, simultaneously with the
effectiveness of such combination or reverse-split, be proportionately
increased.
(b) If there shall occur any capital reorganization or
reclassification of the Company's Common Stock (other than a change in par value
or a subdivision or combination as provided for in subsection 2(a) above), or
any consolidation or merger of the Company with or into another corporation, or
a transfer of all or substantially all of the assets of the Company, or the
payment of a liquidating distribution, then, as part of any such reorganization,
reclassification, consolidation, merger, sale or liquidating distribution,
lawful provision shall be made so that the Registered Holder of this Warrant
shall have the right there after to receive upon the exercise hereof (to the
extent, if any,
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still exercisable) the kind and amount of shares of stock or other securities or
property which such Registered Holder would have been entitled to receive if,
immediately prior to any such reorganization, reclassification, consolidation,
merger, sale or liquidating distribution, as the case may be, such Registered
Holder had held the number of shares of Common Stock which were then purchasable
upon the exercise of this Warrant. In any such case, appropriate adjustment (as
reasonably determined by the Board of Directors of the Company) shall be made in
the applica tion of the provisions set forth herein with respect to the rights
and interests thereafter of the Registered Holder of this Warrant such that the
provisions set forth in this Section 2 (including provisions with respect to
adjustment of the Exercise Price) shall thereafter be applicable, as nearly as
practicable, in relation to any shares of stock or other securities or property
thereafter deliverable upon the exercise of this Warrant.
(c) When any adjustment is required to be made in the Exercise Price,
the number of shares of Warrant Stock purchasable upon the exercise of this
Warrant shall be changed to the number determined by dividing (i) an amount
equal to the number of shares issuable upon the exercise of this Warrant
immediately prior to such adjustment, multiplied by the Exercise Price in effect
immediately prior to such adjustment, by (ii) the Exercise Price in effect
immediately after such adjustment.
(d) No adjustment in the per share Exercise Price shall be required
unless such adjustment would require an increase or decrease in the Exercise
Price of at least $0.01; provided, however, that any adjustments which by reason
of this paragraph are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Section 2
shall be made to the nearest cent or to the nearest 1/100th of a share, as the
case may be. Anything in this Section 2 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the per share Exercise
Price, in addition to those required by this Section 2 as in its discretion it
shall deem to be advisable in order that any stock dividend, subdivision of
shares or distribution rights to purchase stock or securities convertible or
exchangeable for stock hereafter made by the Company to its stockholders shall
not be taxable.
(e) Except as hereinafter provided, in case the Company shall at any
time after the date hereof, but prior to the effective date of the IPO, issue or
sell any shares of Common Stock, including shares held in the Company's
treasury, for a consideration per share less than either the Exercise Price or
the Market Price in effect immediately prior to the issuance or sale of such
shares, or without consideration, then forthwith upon such issuance or sale, the
Exercise Price shall (until another such issuance or sale) be reduced to the
price (calculated to the nearest full cent) equal to the quotient derived by
dividing (i) an amount equal to the sum of (x) the number of shares of Common
Stock outstanding immediately prior to such issuance or sale multiplied by the
lesser of the Exercise Price per share in effect immediately prior to such
issuance or sale or the Market Price in effect on the date immediately prior to
such issuance or sale, plus (y) the aggregate of the amount of all
consideration, if any,
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received by the Company upon such issuance or sale, by (ii) the number of shares
of Common Stock outstanding immediately after such issuance or sale; provided,
however, that in no event shall the Exercise Price be adjusted pursuant to this
computation to an amount in excess of the Exercise Price in effect immediately
prior to such computation.
(f) Upon the happening of any event requiring an adjustment of the
Exercise Price hereunder, the Company shall forthwith give written notice
thereto to the Registered Holder of this Warrant stating the adjusted Exercise
Price and the adjusted number of shares purchasable upon the exercise hereof
resulting from such event and setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based.
(g) For the purposes of any computation to be made in accordance with
Section 2, the following provisions shall be applicable:
(i) Cash Consideration. In case of the issuance or sale by the
Company of shares of Common Stock for a consideration part or all of which
shall be cash, the amount of the cash consideration therefor shall be
deemed to be the amount of cash received by the Company for such shares
(or, if shares of Common Stock are offered by the Company for subscription,
the subscription price, or, if either of such securities shall be sold to
underwriters or dealers for public offering without a subscription
offering, the initial public offering price), before deducting therefrom
any compensation paid or discount allowed in the sale, underwriting or
purchase thereof by underwriters or dealers or others perform ing similar
services, or any expenses incurred in connection therewith.
(ii) Other Than Cash Consideration. In case of the issuance or
sale (otherwise than as a dividend or other distribution on any stock of
the Company) of shares of Common Stock for a consideration part or all of
which shall be other than cash, the amount of the consideration therefor
other than cash shall be deemed to be the value of such consideration as
determined in good faith by the Board of Directors of the Company.
(iii) Outstanding Shares. The number of shares of Common Stock at
any one time outstanding shall include the aggregate number of shares
issued or issuable (subject to readjustment upon the actual issuance
thereof) upon the exercise of any and all outstanding options, rights,
warrants to purchase shares of Common Stock and upon the conversion or
exchange of any and all outstanding securities convertible or exchangeable
into shares of Common Stock.
(h) In case the Company shall at any time after the date hereof issue
options, rights or warrants to subscribe for shares of Common Stock, or issue
any securities convertible into or exchangeable for shares of Common Stock, for
a consideration per share less than either the Exercise Price Per Share or the
Market
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Price in effect immediately prior to the issuance of such options, rights or
warrants, or such convertible or exchangeable securities, or without
consideration, the Exercise Price Per Share in effect immediately prior to the
issuance of such options, rights or warrants, or such convertible or
exchangeable securities, as the case may be, shall be reduced to a price
determined by making a computation in accordance with the provisions of this
Section 2 hereof, provided that:
(i) The aggregate maximum number of shares of Common Stock, as
the case may be, issuable under such options, rights or warrants shall be
deemed to be issued and outstanding at the time such options, rights or
warrants were issued, and for a consideration equal to the minimum purchase
price per share provided for in such options, rights or warrants at the
time of issuance, plus the consideration, if any, received by the Company
for the issuance of such options, rights or warrants.
(ii) The aggregate maximum number of shares of Common Stock
issuable upon conversion or exchange of any convertible or exchangeable
securities shall be deemed to be issued and out standing at the time of
issuance of such securities, and for a consideration equal to the
consideration received by the Company for the issuance of such securities,
plus the minimum consideration, if any, receivable by the Company upon the
conversion or exchange thereof.
(iii) If any change shall occur in the exercise price per share
provided for in any of the options, rights or warrants referred to in
clause (i) of Section 2(h), or in the price per share at which the
securities referred to in clause (ii) of Section 2(h) are convertible or
exchangeable, such options, rights or warrants or conversion or exchange
rights, as the case may be, shall be deemed to have expired or terminated
on the date when such price change became effective in respect of shares
not theretofore issued pursuant to the exercise or conversion or exchange
thereof, and the Company shall be deemed to have issued upon such date new
options, rights or warrants or convertible or exchangeable securities at
the new price in respect of the number of shares issuable upon the exercise
of such options, rights or warrants or the conversion or exchange of such
convertible or exchangeable securities.
(i) No adjustment of the Exercise Price shall be made:
(i) Upon the issuance or sale of the shares of Common Stock
issuable upon the exercise of (i) the Warrants, (ii) convertible debt,
warrants and options outstanding on the date hereof and described in the
Company's Confidential Private Placement Memorandum, dated as of October
30, 1996; or (iii) Options granted under the Company's 1996 Stock Option
Plan, provided that the exercise price of such options shall be not less
than 85% of the Market Price on the date of grant of such options.
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3. Fractional Shares. The Company shall not be required to issue
certificates representing fractions of shares of Common Stock or Warrants upon
the exercise or transfer of the Purchase Option, nor shall it be required to
issue scrip or pay cash in lieu of any fractional interests, it being the intent
of the parties that all fractional interests shall be eliminated by rounding any
fraction up to the nearest whole number of Warrants, shares of Common Stock or
other securities, properties or rights.
4. Limitation on Sales, etc. Each holder of this Warrant acknowledges that
this Warrant and the Warrant Stock have not been registered under the Securities
Act of 1933, as now in force or hereafter amended, or any successor legislation
("Act"), and agrees not to sell, pledge, distribute, offer for sale, transfer or
otherwise dispose of this Warrant or any Warrant Stock issued upon its exercise
in the absence of (a) an effective registration statement under the Act as to
this Warrant and the Warrant Stock issued upon its exercise and registration or
qualification of this Warrant or such Warrant Stock under any applicable Blue
Sky or state securities law then in effect, or (b) an opinion of counsel,
satisfactory to the Company, that such registration and qualification are not
required.
Without limiting the generality of the foregoing, unless the offering
and sale of the Warrant Stock to be issued upon the exercise of the Warrant
shall have been effectively registered under the Act, the Company shall be under
no obligation to issue the shares covered by such exercise unless and until the
Registered Holder shall have executed an investment letter in form and substance
reasonably satisfactory to the Company, including a warranty at the time of such
exercise that it is acquiring such shares for its own account, for investment
and not with a view to, or for sale in connection with, the distribution of any
such shares, in which event the Registered Holder shall be bound by the
provisions of a legend or legends to such effect which shall be endorsed upon
the certificate(s) representing the Warrant Stock issued pursuant to such
exercise.
5. Certain Dividends. If the Company pays a dividend or makes a
distribution on the Common Stock payable otherwise than in cash out of earnings
or earned surplus (determined in accordance with generally accepted accounting
principles) except for a stock dividend payable in shares of Common Stock
("Property Dividend"), then the Company will pay or distribute to the Registered
Holder of this Warrant, upon the exercise hereof, in addition to the Warrant
Stock purchased upon such exercise, the Property Dividend which would have been
paid to such Registered Holder if the Registered Holder had been the owner of
record of such shares of Warrant Stock immediately prior to the date on which a
record is taken for such Property Dividend or, if no record is taken, the date
as of which the record holders of Common Stock entitled to such dividends or
distribution are to be determined.
6. Registration Rights of Warrant Holder.
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(a) In the event that the Company consummates an IPO with ▇▇▇▇▇▇▇
Equities, Inc. or any of its affiliates, then it shall file twelve full calendar
months and one day from the effective date ("Effective Date") of the IPO a
Registration Statement under the Act ("Registration Statement") with the
Securities and Exchange Commission registering for resale the Warrants and the
underlying shares of Common Stock ("Registrable Securities"). On such occasion,
the Company will use its best efforts to have such registration statement
declared effective promptly thereafter. Should this registration or the
effectiveness thereof be delayed by the Company, the exercisability of the
Warrants shall be extended ("Delay Extension") for a period of time equal to the
delay in registering the Registrable Securities provided, however, that such
extension date shall not extend beyond five years from the Effective Date.
Moreover, if the Company fails to comply with the provisions of this Section 6,
the Company shall, in addition to any other equitable or other relief available
to the holders of the Warrants ("Holders"), be liable for any and all
incidental, special and consequential damages sustained by the Holder(s).
(b) In addition to the registration rights granted in subsection (a)
above, the Holders shall have the right until November 30, 2002 to include the
Registrable Securities as part of any other registration of securities filed by
the Company (other than in connection with a transaction contemplated by Rule
145(a) promulgated under the Act or pursuant to Form S-8 or any equivalent
form).
(c) The Company shall bear all fees and expenses attendant to
registering the Registrable Securities, but the Holders shall pay any and all
underwriting commissions and the expenses of any legal counsel selected by the
Holders to represent them in connection with the sale of the Registrable
Securities. The Company agrees to use its best efforts to cause the filing
required herein to become effective promptly and to qualify or register the
Registrable Securities in such States as are reasonably requested by the
Holder(s); provided, however, that in no event shall the Company be required to
register the Registrable Securities in a State in which such registration would
cause (i) the Company to be obligated to register or license to do business in
such State, or (ii) the principal stockholders of the Company to be obligated to
escrow their shares of capital stock of the Company. The Company shall cause any
registration statement filed pursuant to the rights granted under this Section 6
to remain effective until the earliest of (i) November 30, 2003, (ii) the date
by which all of the Registrable Securities have been sold pursuant to the
registration statement, or (iii) the date by which all of the Registrable
Securities are eligible for resale without restriction pursuant to Rule 144(K)
promulgated under the Act.
(d) The Company shall indemnify the Holder(s) of the Registrable
Securities to be sold pursuant to any registration statement hereunder and each
person, if any, who controls such Holders within the meaning of Section 15 of
the Act or Section 20(a) of the Securities Exchange Act of 1934, as amended
("Exchange Act"), against all loss, claim, damage, expense or liability
(including all reasonable attorneys' fees and other expenses reasonably incurred
in investigating, preparing or defending
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against any claim whatsoever) to which any of them may become subject under the
Act, the Exchange Act or otherwise, arising from such registration statement.
The Holder(s) of the Registrable Securities to be sold pursuant to such
registration statement, and their successors and assigns, shall severally, and
not jointly, indemnify the Company, against all loss, claim, damage, expense or
liability (including all reasonable attorneys' fees and other expenses
reasonably incurred in investigating, prepar ing or defending against any claim
whatsoever) to which they may become subject under the Act, the Exchange Act or
otherwise, arising from information furnished by or on behalf of such Holders,
or their successors or assigns, in writing, for specific inclusion in such
registration statement. (e) Nothing contained in this Warrant shall be construed
as requiring the Holder(s) to exercise their Warrants prior to or after the
initial filing of any registration statement or the effectiveness thereof.
(f) The Company shall furnish to each Holder participating in any of
the foregoing offerings and to each underwriter of any such offering, if any, a
signed counterpart, addressed to such Holder or underwriter, of (i) an opinion
of counsel to the Com pany, dated the effective date of such registration
statement (and, if such registration includes an underwritten public offer ing,
an opinion dated the date of the closing under any under writing agreement
related thereto), and (ii) a "cold comfort" letter dated the effective date of
such registration statement (and, if such registration includes an underwritten
public offering, a letter dated the date of the closing under the underwriting
agreement) signed by the independent public accountants who have issued a report
on the Company's financial statements included in such registration statement,
in each case covering substantially the same matters with respect to such
registration statement (and the prospectus included therein) and, in the case of
such accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to underwriters in underwritten public
offerings of securities. The Company shall also deliver promptly to each Holder
participating in the offering requesting the correspondence and memoranda
described below and to the managing underwriter copies of all correspondence
between the Commission and the Company, its counsel or auditors and all
memoranda relating to discussions with the Commission or its staff with respect
to the registration statement and permit each Holder and underwriter to do such
investigation, upon reasonable advance notice, with respect to information
contained in or omitted from the registration statement as it deems reasonably
necessary to comply with applicable securities laws or rules of the National
Association of Securities Dealers, Inc. ("NASD"). Such investigation shall
include access to books, records and properties and opportunities to discuss the
business of the Company with its officers and independent auditors, all to such
reasonable extent and at such reasonable times and as often as any such Holder
shall reasonably request.
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(g) The Company shall enter into an underwriting agreement with the
managing underwriter(s) selected by a majority of Holders whose Registrable
Securities are being registered pursuant to this Section 6(a). Such agreement
shall be reasonably satisfactory in form and substance to the Company, each
Holder and such managing underwriters, and shall contain such representations,
warranties and covenants by the Company and such other terms as are customarily
contained in agreements of that type used by the managing underwriter. The
Holders shall be parties to any underwriting agreement relating to an
underwritten sale of their Registrable Securities and may, at their option,
require that any or all the representations, warranties and covenants of the
Company to or for the benefit of such under writers shall also be made to and
for the benefit of such Holders. Such Holders shall not be required to make any
repre sentations or warranties to or agreements with the Company or the
underwriters except as they may relate to such Holders, their shares and their
intended methods of distribution.
(h) Each of the Holder(s) participating in any of the foregoing
offerings shall furnish to the Company a completed and executed questionnaire
provided by the Company requesting information customarily sought of selling
securityholders.
7. Redemption of Warrants by the Company.
(a) Redemption. If an IPO has not been consummated by May 30, 1997,
the Warrants may be redeemed, at the option of the Company, as a whole at any
time prior to the Expiration Date, at the executive office of the Company, upon
the notice referred to in Section 7(b) at the price of $.25 per Warrant
("Redemption Price"), provided that (i) the Warrants and the underlying Common
Stock are registered on Form ▇▇-▇, ▇-▇ or other form of registration statement
used by the Company, and (ii) the Class A and Class B Promissory Notes have been
paid in full.
(b) Date Fixed for and Notice of Redemption. Notice of redemption
shall be mailed by first class mail, postage prepaid, by the Company or the
Company's agent at its discretion not less than 30 days from the date fixed for
redemption to the Registered Holders of the Warrants to be redeemed at their
last address as they shall appear on the registration books. Any notice mailed
in the manner herein provided shall be conclusively presumed to have been duly
given whether or not the registered holder received such notice.
(c) Exercise After Notice of Redemption. The Warrants may be exercised
in accordance with Section 1 of this Agreement at any time after notice of
redemption shall have been given to the Company pursuant to Section 7(b) hereof
and prior to the date fixed for redemption. On and after the redemption date,
the record holder of the Warrants shall have no further rights except to
receive, upon surrender of the Warrants, the Redemption Price.
8. Notices of Record Date, etc. In case:
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(a) the Company shall take a record of the holders of its Common Stock
(or other securities at the time issuable upon the exercise of this Warrant) for
the purpose of entitling or enabling them to receive any dividend or other
distribution (other than a dividend or distribution payable solely in capital
stock of the Company or out of funds legally available therefor), or to receive
any right to subscribe for or purchase any shares of stock of any class or any
other securities, or to receive any other right; or
(b) of any capital reorganization of the Company, any reclassification
of the capital stock of the Company, any consolidation or merger of the Company
with or into another corporation (other than a consolidation or merger in which
the Company is the surviving entity), or any transfer of all or substantially
all of the assets of the Company; or
(c) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company; then, and in each such case, the Company will mail or
cause to be mailed to the Registered Holder of this Warrant a notice specifying,
as the case may be, (i) the date on which a record is to be taken for the
purpose of such dividend, distribution or right, and stating the amount and
character of such dividend, distribution or right, or (ii) the effective date on
which such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up is to take place, and the time, if any is
to be fixed, as of which the holders of record of Common Stock (or such other
stock or securities as are at the time issuable upon the exercise of this
Warrant) shall be entitled to exchange their shares of Common Stock (or such
other stock or securities) for securities or other property deliverable upon
such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up. Such notice shall be mailed at least ten
(10) days prior to the record date or effective date, for the event specified in
such notice, provided that the failure to mail such notice shall not affect the
legality or validity of any such action.
9. Reservation of Stock. The Company will at all times reserve and keep
available, solely for issuance and delivery upon the exercise of this Warrant,
such shares of Warrant Stock and other stock, securities and property, as from
time to time shall be issuable upon the exercise of this Warrant.
10. Replacement of Warrants. 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 the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.
11. Transfers, etc. The Company will maintain a register containing the
names and addresses of the Registered Holders of this Warrant and of the holders
of other warrants of like tenor issued simultaneously hereunder. Any Registered
Holder
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may change its, his or her address as shown on the warrant register by written
notice to the Company requesting such change.
Until any transfer of this Warrant is made in the warrant register,
the Company may treat the Registered Holder of this Warrant as the absolute
owner hereof for all purposes; pro vided, however, that if and when this Warrant
is properly as signed in blank, the Company may (but shall not be obligated to)
treat the bearer hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary.
12. Mailing of Notices, etc. All notices and other communications from the
Company to the Registered Holder of this Warrant shall be mailed by first-class
certified or registered mail, postage prepaid, sent by reputable overnight
delivery or by facsimile to the address furnished to the Company in writing by
the last Registered Holder of this Warrant who shall have furnished an address
to the Company in writing. All notices and other communications from the
Registered Holder of this Warrant or in connection herewith to the Company shall
be mailed by first-class certified or registered mail, postage prepaid, sent by
reputable overnight delivery or by facsimile to the Company at its offices at, ▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or such other address as the Company
shall so notify the Registered Holder.
13. No Rights as Stockholders. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a stockholder of the Company.
14. Change or Waiver. Any term of this Warrant may be changed or waived
only by an instrument in writing signed by the party against whom enforcement of
the change or waiver is sought.
15. Headings. The headings of this Warrant are for purposes of reference
only and shall not limit or otherwise affect the meaning of any provision of
this Warrant.
16. Governing Law. This Warrant will be governed by and construed in
accordance with the law of the State of New York without regard to the
principles of conflict of law.
17. Venue. The Company (a) agrees that any legal suit, action or proceeding
arising out of or relating to this Warrant shall be instituted exclusively in
New York State Supreme Court, County of New York or in the United States
District Court for the Southern District of New York, (b) waives any objection
to the venue of any such suit, action or proceeding and the right to assert that
such forum is not a convenient forum, and (c) irrevocably consents to the
jurisdiction of the New York State Supreme Court, County of New York, and the
United States District Court for the Southern District of New York in any such
suit, action or proceeding. The Company further agrees to accept and acknowledge
service of any and all process which may be served in any such suit, action or
proceeding in the New York State Supreme Court, County of New York, or in the
United States District Court for the Southern District of New York and
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agrees that service of process upon it mailed by certified mail to its address
shall be deemed in every respect effective service of process upon it in any
such suit, action or proceeding.
Dated: __________, 1996 AUGMENT SYSTEMS, INC.
By:________________________________________
▇▇▇▇▇ ▇. ▇▇▇▇, Chief Financial Officer
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EXHIBIT I
PURCHASE FORM
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To: AUGMENT SYSTEMS, INC.
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Dated:________________________________
In accordance with the provisions set forth in the attached Warrant (No.
__), the undersigned hereby irrevocably elects to purchase ________ shares of
the Common Stock covered by such Warrant and herewith makes payment of $_______,
representing the full Exercise Price for such shares at the price per share
provided for in such Warrant.
or
The undersigned hereby elects irrevocably to exercise the within Purchase
Option and to purchase _________ shares of Common Stock of Augment Systems, Inc.
by surrender of the unexercised portion of the within Purchase Option (with a
"Value" of $__________ based on a "Market Price" of $___________).
The undersigned has had the opportunity to ask questions of and receive
answers from the officers of the Company regarding the affairs of the Company
and related matters, and has had the opportunity to obtain additional
information necessary to verify the accuracy of all information so obtained.
The undersigned understands that the shares have not been registered under
the Securities Act of 1933, as amended, or the securities laws of any other
jurisdiction, and hereby represents to the Company that the undersigned is
acquiring the shares for its own account, for investment, and not with a view
to, or for sale in connection with, the distribution of any such shares.
Signature______________________
Address ______________________
______________________