EXHIBIT 10(e)
THE GRANT OF THIS WARRANT AND THE PURCHASE OF THE COMMON STOCK ISSUABLE UPON
EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD
OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM.
COMMON STOCK PURCHASE WARRANT AGREEMENT
This COMMON STOCK PURCHASE WARRANT AGREEMENT (the "Warrant Agreement")
is entered into effective as of the 8th day of December, 1995, by and
between ▇▇▇▇▇▇▇ RADIO CORP., a Delaware corporation (the "Company"), and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and his successors and permitted assigns ("Holder"),
▇▇. ▇▇▇▇▇▇ being the President of FIRST CAMBRIDGE SECURITIES CORPORATION, a
Connecticut corporation ("First Cambridge").
WHEREAS, on even date herewith, the Company and First Cambridge entered
into that certain Consulting Agreement (the "Consulting Agreement")
whereby the Company engaged First Cambridge to render to the Company certain
consulting services more particularly described in Section 2 thereof
(the "Consulting Services"); and
WHEREAS, in consideration for the Consulting Agreement and for the
Consulting Services to be provided thereunder, the Company has agreed to
issue to First Cambridge, and/or officers of First Cambridge designated
by it upon its execution and delivery of the Consulting Agreement, Holder
being so designated by the execution by First Cambridge of this Warrant
Agreement, Common Stock Purchase Warrants (the "Warrants") to purchase an
aggregate of 250,000 shares of the Company's common stock, par value $0.01
per share (the "Common Stock"), pursuant to the requirements relating to
the exercise thereof set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth and for the purpose of defining the terms
and provisions of the Warrants and the respective rights and obligations
thereunder, the parties hereto agree as follows:
1. Grant of Warrants. For value received, the Company hereby grants
Holder, subject to the terms and conditions hereinafter set forth, the right
to purchase up to a maximum of 50,000 shares of the Common Stock of the
Company (the "Shares"), subject to adjustment as set forth herein.
2. Exercise of Warrants. The Warrants will vest and may be exercised
by the Holder as to (i) 50% of the Shares covered hereby at any time after
June 8, 1996, and (ii) all or any part of the Shares covered hereby at
any time after December 8, 1996, in either event until December 8, 2000,
when such Warrants shall expire, at an exercise price of $4.00 per share.
The Holder shall deliver to the Company written notice of Holder's
intent to exercise the Warrants at Nine ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, or at such other address as the Company shall designate in
writing to the Holder, together with this Warrant Agreement and a check
payable to the order of the Company for the aggregate purchase price of
the Shares so purchased. Upon exercise of the Warrants as aforesaid, the
Company shall as promptly as practicable, and in any event within 10 days
thereafter, execute and deliver to the Holder a certificate or certificates
in the name of the Holder for the total number of whole Shares for which
the Warrants are being exercised. If the Warrants shall be exercised
with respect to less than all of the Shares, the Holder shall be entitled
to receive a similar warrant of like tenor and date covering the number of
Shares in respect of which the Warrants were not exercised. The Warrants
covered by this Warrant Agreement shall lapse and be null and void if
not exercised by the Holder on or before 5:00 p.m., New York City time, on
December 8, 2000.
3. Covenants of the Company. The Company covenants and agrees that
all the Shares which may be issued upon the exercise of the Warrants
represented by this Warrant Agreement will, upon issuance, be fully paid
and nonassessable and free from all taxes, liens, and charges with respect
to the issue thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue). The Company further covenants and
agrees that during the period within which the Warrants represented by
this Warrant Agreement may be exercised, the Company will at all times have
authorized and reserved a sufficient number of Shares to provide for the
exercise of the Warrants represented by this Warrant Agreement.
4. Adjustments of Warrant Exercise Price and Number of Shares.
(a) If the Company shall, without the payment of new value,
at any time declare a stock dividend on its outstanding shares of Common
Stock or effectuate a stock split or reverse stock split, by subdivision
or consolidation in any manner, regarding the number of shares of the
Common Stock then outstanding into a different number of shares of the Common
Stock, with or without par value, then thereafter the number of Shares
which the holder shall have the right to purchase (calculated immediately
prior to such change), shall be increased or decreased, as the case may
be, in direct proportion to the increase or decrease in the number of shares
of the Common Stock of the Company issued and outstanding by reason of
such dividend or change, and the Warrant Exercise Price of the Shares
after such change shall in the event of an increase in the number of shares
of the Common Stock be proportionately reduced, and in the event of a
decrease in the number of shares of the Common Stock be proportionately
increased.
(b) Notwithstanding anything herein to the contrary, for
purposes of this Section 4, the Holder agrees that no adjustment shall be
made to the Warrant Exercise Price or the number of Shares issuable upon
the exercise of this Warrant Agreement upon issuance of Common Stock (or
any other securities) of the Company for any purposes other than as set
forth in Sections 4(a) and 5 herein.
5. Survival of Mergers and Reorganizations. In the event of the
reclassification or change in the outstanding Shares (other than a change
in par value, or from par value to no par value, of from no par value, or
as a result of a subdivision, combination or stock dividend), or in the
event of a sale of all or substantially all of the assets of the Company,
or in the event of any consolidation of the Company with, or merger of
the Company into, another corporation, the Company, or such successor
corporation, as the case may be, shall provide that, the Holder shall
thereafter be entitled to purchase the kind and amount of shares of stock and
other securities and property receivable upon such reclassification, change,
consolidation, sale, or merger by a holder of the number of Shares which
this Warrant Agreement entitled the holder thereof to purchase immediately
prior to such reclassification, change, consolidation, sale, or merger.
Such corporation, which thereafter shall be deemed to be the Company
for purposes of this Warrant Agreement, shall provide for adjustments, if
any, which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Warrant Agreement.
6. Sale of Assets, Dissolution. In the event of a merger,
consolidation, or the sale of all or substantially all the assets of the
Company, or in the event of any distribution of all or substantially all of
its assets in dissolution or liquidation, the Company shall mail notice the
reof by registered mail to the Holder and shall make no distribution to the
stockholders of the Company until the expiration of 10 days from the date
of mailing of the aforesaid notice; provided, however, that in any such
event, if the Holder shall not exercise the Warrants within 10 days from
the date of mailing such notice all rights herein granted and not so
exercised within such 10 day period shall thereafter become null and void.
The Company shall not, however, be prevented from consummating any such merger,
consolidation, or sale without awaiting the expiration of such 10 day
period, it being the intent and purpose hereof to enable the Holder,
upon exercise of the Warrants, to participate in the distribution of the
consideration to be received by the Company upon any such merger,
consolidation, or sale or in the distribution of assets upon any dissolution or
liquidation.
7. No Fractional Shares. The number of Shares subject to issuance
upon the complete exercise of the Warrants shall be rounded down to the
nearest whole number of Shares so that no fractional Shares shall be issued
upon the complete exercise of the Warrants. The Holder shall not be
entitled to receive any compensation or property for such fractional Share
to which it may have been entitled to in the absence of this provision.
8. Notices. If there shall be any adjustment in accordance with
this Warrant Agreement, or if securities or property other than Shares of
the Company shall become purchasable in lieu of Shares upon exercise of
the Warrants, the Company shall forthwith cause written notice thereof to
be sent by registered mail, postage prepaid, to the Holder at its address
shown on the books of the Company, which notice shall be accompanied by a
certificate of either independent public accountants of recognized standing
or the Chairman, President, or any Vice President of the Company setting
forth in reasonable detail the basis for the Holder becoming entitled to
purchase such Shares and the number of Shares which may be purchased and the
exercise price thereof, or the facts requiring any such adjustment, or the
kind and amount of any such securities or property so purchasable upon the
exercise of the Warrants, as the case may be.
9. Taxes. The issue of any stock or other certificate upon the
exercise of the Warrant shall be made without charge to the Holder for any
stamp, duty, excise, or similar tax (but not including the Holder's income
or similar taxes) in respect of the issue of such certificate. The Company
shall not, however, be required to pay any tax which may be payable in respect
of any transfer involved in the issue and delivery of any certificate in a
name other than that of the Holder, as the registered holder of this
Warrant Agreement, and the Company shall not be required to issue or
deliver any such certificate unless and until the person or persons requesting
the issue 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.
10. Non-transferability of Warrants. The Warrants shall be
nontransferable without the express written consent of the Company.
11. Warrant Holder Not Stockholder. This Warrant Agreement does
not confer upon the Holder any right to vote or to consent or to receive
notice as a stockholder of the Company, as such in respect of any matters
whatsoever, or any other rights or liabilities as a stockholder, prior to
the exercise hereof as provided herein.
12. Investment Representations. The Holder, by acceptance hereof,
and with reference to the Warrants and the Shares issuable upon exercise
of the Warrants, represents and warrants that:
(a) The Holder is acquiring such securities for investment
purposes only, for its own account, and not with a view toward resale or other
distribution thereof, and has no present intention of selling or otherwise
disposing of such securities.
(b) The Holder is aware that the securities have not been
registered under the Securities Act of 1933, as amended ("Securities Act"),
or any state securities law, that upon exercise of the Warrants, the Shares
must be held indefinitely unless they are subsequently registered or an
exemption from such registration is available and that the Company is
under no obligation to register the offer and sale of the Shares under
the Securities Act or any applicable state securities laws, except as otherwise
set forth in Section 14 hereof.
(c) The Holder acknowledges that the Warrants may not be
made subject to a security interest, pledged, hypothecated, sold, or otherwise
transferred in the absence of an effective registration statement for such
Warrants under the Securities Act and such applicable state securities laws
or there is an applicable exemption therefrom. The Holder further acknowledges
that, unless the offer and sale of the Shares issuable upon exercise of the
Warrants have been registered under the Securities Act, the Shares issued
upon the exercise of the Warrants shall be restricted in the same manner and
to the same extent as the Warrants and the certificates representing such
Shares shall bear the following legend:
"THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("SECURITIES ACT"),
OR ANY APPLICABLE STATE SECURITIES LAWS, BUT HAVE BEEN ACQUIRED FOR THE
PRIVATE INVESTMENT OF THE HOLDER HEREOF AND MAY NOT BE OFFERED, SOLD, OR
TRANSFERRED UNTIL A REGISTRATION STATEMENT UNDER SUCH SECURITIES ACT AND
SUCH APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME EFFECTIVE WITH
REGARD THERETO, OR THERE IS AN AVAILABLE EXEMPTION THEREFROM."
In making the above representations and warranties, the Holder intends
that the Company rely thereon and understands that, as the result of such
reliance, such securities are not being registered under the Securities
Act or any applicable state securities laws in reliance upon the applicability
of certain exemptions relating to transactions not involving a public
offering.
13. Lost Warrants. In case this Warrant Agreement shall be mutilated,
lost, stolen, or destroyed, the Company will issue a new Warrant Agreement
of like date, tenor, denomination and terms and conditions, and deliver the
same in exchange and substitution for and upon surrender and cancellation
of the mutilated Warrant Agreement, or in lieu of any Warrant Agreement
lost, stolen, or destroyed, upon receipt of evidence satisfactory to
the Company of the loss, theft, or destruction of such Warrant Agreement,
and upon receipt of indemnity satisfactory to the Company.
14. Registration Rights.
(a) The Company agrees that if at any time hereafter the Company
files with the Securities and Exchange Commission ("Commission") a
registration statement ("Registration Statement") under the Securities Act on
a form suitable for registering the Shares issuable upon exercise of the
Warrants (other than on Form ▇-▇, ▇-▇, or comparable registration statement,
and other than any registration statement which has been declared effective
by the Commission prior to the date hereof or has been filed with the
Commission prior to the date hereof but has not yet been declared effective),
it will give written notice to such effect to the Holder, at least 30
days prior to such filing, and, at the written request of the Holder,
made within 10 days after the receipt of such notice, will include therein
at the Company's cost and expense (except for the fees and expenses of
counsel to the Holder and underwriting discounts and commissions attributable
to the Shares of Warrant Common Stock [as hereinafter defined] included
therein) such of the Shares of Warrant Common Stock held by the Holder as
it shall request. If the registration is an underwritten primary registration
on behalf of the Company, and the managing underwriter(s) advise the Company
in writing that in their good faith opinion, based upon market conditions,
the number of securities requested to be included in such registration exceeds
the number which can be sold in such offering, the Company will include in
such registration (i) first, the securities the Company proposes to sell,
(ii) second, the Warrant Common Stock requested to be included in such
registration and other securities requested to be included in such
registration pursuant to contractual arrangements between Company and such
other security holders ("Registration Rights Holders"), pro rata among the
holders of the Warrant Common Stock and the Registration Rights Holders on
the basis of the number of securities requested to be included in such
registration by such holders and the Registration Rights Holders, and
(iii) third, other securities requested to be included in such registration.
The Company, at its own expense, will cause the prospectus included in such
Registration Statement to meet the requirements of the Securities Act for such
period of time, not exceeding 180 days, as may be necessary to effect the sale
of the Shares included at the request of the Holder. The term "Warrant Common
Stock" shall mean the Shares issuable and issued pursuant to this Warrant
Agreement and all other Warrants originally granted to First Cambridge and/or
its officers as contemplated in the second recital hereof and pursuant to
all Warrants issued upon transfer, division, or combination of, or in
substitution for, any thereof. The rights of the Holder under this Section
14 shall apply to an unlimited number of offerings proposed by the Company.
(b) The Company promptly shall notify the Holder, as a
participating holder of Warrant Common Stock, of the occurrence of any event
as a result of which any prospectus included in a registration statement
filed pursuant to this Section 14 includes any misstatement of a material
fact or omission of any material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances
under which they were made, not misleading.
(c) In addition, upon written notice received at any time on
or before 5:00 p.m., New York City time, on December 8, 2000, from the Holder
or other holders of a minimum of 50% or more of the Warrant Common Stock
originally subject to the Warrants granted to First Cambridge and/or its
officers as contemplated in the second recital hereof, that the Holder
contemplates the transfer of all or any of his or its Warrant Common Stock
under such circumstances that a public offering, within the meaning of the
Securities Act, will be involved, the Company shall, not more than once, at
the expense of the Company, except for the fees and expenses of counsel to
the Holder and other holders and underwriting discounts and commissions
attributable to the Shares of Warrant Common Stock included therein, as
promptly as possible after receipt of such notice, file a new registration
statement or, if available, an offering statement under Regulation A under
the Securities Act, with respect to the offering and sale or other disposition
of the Warrant Common Stock with respect to which it shall have received such
notice; provided, that the Company will only be required to file a registration
statement or offering statement or amendment thereto no later than 135 days
after any fiscal year end of the Company and at such time as it has available
for utilization therein the audited consolidated financial statements of the
Company as of the preceding fiscal year end. The Company must file a
registration statement or offering statement if the Shares of Warrant Common
Stock cannot be sold under Regulation A because of the limited exemption.
The Company agrees as soon as reasonably practicable to cause the above filing
to become effective. Within 10 days after receiving such notice, the Company
shall give notice to the other holders of the Warrants and Warrant Common Stock
advising that the Company is proceeding with such registration statement or
offering statement and offering to include therein Warrant Common Stock of
such Holder. The Company shall not be obligated to any such other Holder
unless such other Holder shall accept such offer by notice in writing to the
Company within 10 days thereafter.
(d) The Company's obligations under this Section 14 with
respect to the Holder, as the holder of Warrant Common Stock, are expressly
conditioned upon the Holder promptly, completely, and accurately furnishing
to the Company in writing such information concerning the Holder and the terms
of the Holder's proposed offering as the Company shall request for inclusion in
the Registration Statement.
15. Indemnification by Company. In the event of the registration
of the offer and sale of any of the Shares of Warrant Common Stock, the
Company will indemnify the Holder, if applicable, and hold the Holder harmless
against any losses, claims, damages, or liabilities, to which the Holder
may become subject under the Securities Act, or any similar federal statute,
and state Blue Sky and securities laws, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereof) arise out of, or are
based upon, any untrue statement or alleged untrue statement under which the
offer and sale of the Shares of Warrant Common Stock were registered under such
Securities Act or similar federal statute, any state Blue Sky or securities
law, any preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereto, or arise out of, or are based upon, the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
will reimburse the Holder for any legal or any other expenses reasonably
incurred by the Holder in connection with investigating or defending any such
loss, claim, damage, liability, or action; provided, however, that to the
extent that any such loss, claim, damage, or liability arises out of, or is
based upon, an untrue statement or alleged untrue statement or omission or
alleged omission made in said registration statement, said preliminary
prospectus or said final prospectus or any said amendment or supplement in
reliance upon, and in conformity with, information furnished to the Company,
the Company will not be so liable to the Holder.
16. Indemnification by the Holder. The Holder, if applicable, by
acceptance hereof, agrees to indemnify and hold harmless the Company, its
directors and officers, and each other person, if any, who controls the
Company, against any losses, claims, damages, or liabilities, joint or several,
to which the Company or any such director or officer or any such person may
become subject under the Securities Act, or any other statute or at common
law, insofar as such losses, claims, damages, or liabilities (or actions in
respect thereof) arise out of or are based upon the disposition by the Holder
of the Warrants or the Shares issuable upon the exercise hereof in violation
of the provisions of this Warrant Agreement or arises out of, or is based
upon, an untrue statement or alleged untrue statement or omission or alleged
omission made in any registration statement, any preliminary prospectus, or
final prospectus, or any amendment or supplement thereto in reliance upon, and
in conformity with, information furnished to the Company.
17. Applicable Law. This Warrant Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware, without regard
to the conflict of laws provisions thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Warrant
Agreement effective as of the day and year first above written.
▇▇▇▇▇▇▇ RADIO CORP.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
FIRST CAMBRIDGE SECURITIES CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇, Chairman and CEO
