Exhibit 4.1
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON
ITS EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON
TRANSFER SET FORTH IN SECTION 4 OF THIS WARRANT
Warrant No. ____ Number of Shares:________
(subject to adjustment)
Date of Issuance: December ___, 1998
Inso Corporation
Common Stock Purchase Warrant
(Void after December ___, 2000)
Inso Corporation, a Delaware corporation (the "Company"), for
value received, hereby certifies that , or its
registered assigns (the "Registered Holder"), is entitled, subject to the
terms set forth below, to purchase from the Company, at any time or
from time to time on or after the date of issuance and on or before
December ___, 2000 at not later than 5:00 p.m. (Boston, Massachusetts
time), ________ shares of Common Stock, $.01 par value per share, of the
Company, at a purchase price of $23.50 per share. The shares purchasable
upon exercise of this Warrant, and the purchase price
per share, each as adjusted from time to time pursuant to the provisions of
this Warrant, are hereinafter referred to as the "Warrant Shares" and the
"Purchase 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 or by such Registered Holder's duly authorized attorney, 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 Purchase Price payable in respect of the number
of Warrant Shares purchased upon such exercise. The Purchase Price may be
paid by cash, check or wire transfer.
(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 this Warrant shall have been surrendered to the Company (the
"Exercise Date") as provided in subsection 1(a) above. At such time, the
person or persons in whose name or names any certificates for Warrant
Shares 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 Shares 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 as such Holder (upon payment by such Holder
of any applicable transfer taxes) may direct:
(A) a certificate or certificates for the
number of full Warrant Shares to which such Registered Holder shall be
entitled upon such exercise; and
(B) 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 Warrant Shares 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.
2. Adjustments.
(a) If outstanding shares of the Company's
Common Stock shall be subdivided into a greater number of shares or a
dividend in Common Stock shall be paid in respect of Common Stock, the
Purchase 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 immediately after the record date of such dividend be
proportionately reduced. If outstanding shares of Common Stock shall be
combined into a smaller number of shares, the Purchase Price in effect
immediately prior to such combination shall, simultaneously with the
effectiveness of such combination, be proportionately increased. When any
adjustment is required to be made in the Purchase Price, the number of
Warrant Shares 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 Purchase Price in effect
immediately prior to such adjustment, by (ii) the Purchase Price in effect
immediately after such adjustment.
(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, then, as part of any such reorganization, reclassification,
consolidation, merger or sale, as the case may be, lawful provision shall be
made so that the Registered Holder of this Warrant shall have the right
thereafter to receive upon the exercise hereof 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 or sale, 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 in good faith by the Board
of Directors of the Company) shall be made in the application 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 Purchase Price) shall thereafter be applicable, as nearly as is
reasonably 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 Purchase Price, the Company shall promptly mail to the Registered
Holder a certificate setting forth the Purchase Price after such adjustment and
setting forth a brief statement of the facts requiring such adjustment. Such
certificate shall also set forth the kind and amount of stock or other
securities or property into which this Warrant shall be exercisable following
the occurrence of any of the events specified in subsection 2(a) or (b)
above.
3. Fractional Shares. The Company shall not be required
upon the exercise of this Warrant to issue any fractional shares, but shall
round up or down to the nearest whole number of shares.
4. Requirements for Transfer.
(a) This Warrant and the Warrant Shares shall not
be sold or transferred unless either (i) they first shall have been registered
under the Securities Act of 1933, as amended (the "Act"), or (ii) the Company
first shall have been furnished with an opinion of legal counsel, reasonably
satisfactory to the Company, to the effect that such sale or transfer is
exempt from the registration requirements of the Act.
(b) Notwithstanding the foregoing, no registration
or opinion of counsel shall be required for (i) a transfer by a Registered
Holder which is a partnership to a partner of such partnership or a retired
partner of such partnership who retires after the date hereof, or to the estate
of any such partner or retired partner or to any other "accredited investor,"
as defined under Rule 501 of the Securities Act, if the transferee agrees in
writing to be subject to the terms of this Section 4, or (ii) a transfer made
in accordance with Rule 144 under the Act.
(c) Each certificate representing Warrant Shares
shall bear a legend substantially in the following form:
"The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended, and may not be offered, sold or
otherwise transferred, pledged or hypothecated unless and until such
securities are registered under such Act or an opinion of counsel satisfactory
to the Company is obtained to the effect that such registration is not
required."
The foregoing legend shall be removed from the certificates representing any
Warrant Shares, at the request of the holder thereof, at such time as they
become eligible for resale pursuant to Rule 144(k) under the Act.
5. No Impairment. The Company will not, by amendment
of its charter or through reorganization, consolidation, merger, dissolution,
sale of assets or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to
protect the rights of the holder of this Warrant against impairment.
6. Liquidating 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 (a "Liquidating Dividend"), then the Company will pay or
distribute to the Registered Holder of this Warrant, upon the exercise hereof,
in addition to the Warrant Shares purchased upon such exercise, the
Liquidating Dividend which would have been paid to such Registered Holder
if he had been the owner of record of such Warrant Shares immediately prior
to the date on which a record is taken for such Liquidating 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.
7. Notices of Record Date, etc. In case:
(a) the Company shall take a record of the holders
of its Common Stock (or other stock or securities at the time deliverable upon
the exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution, 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 at the time deliverable 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.
8. 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 number of Warrant Shares and other stock, securities
and property, as from time to time shall be issuable upon the exercise of this
Warrant.
9. Exchange of Warrants. Upon the surrender by the
Registered Holder of any Warrant or Warrants, properly endorsed, to the
Company at the principal office of the Company, the Company will, subject to
the provisions of Section 4 hereof, issue and deliver to or upon the order of
such Holder, at the Company's expense, a new Warrant or Warrants of like
tenor, in the name of such Registered Holder or as such Registered Holder
(upon payment by such Registered Holder of any applicable transfer taxes)
may direct, calling in the aggregate on the face or faces thereof for the
number of shares of Common Stock called for on the face or faces of the
Warrant or Warrants so surrendered.
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.
(a) The Company will maintain a register
containing the names and addresses of the Registered Holders of this
Warrant. Any Registered Holder may change its or his address as shown on
the warrant register by written notice to the Company requesting such
change.
(b) Subject to the provisions of Section 4 hereof, this
Warrant and all rights hereunder are transferable, in whole or in part, upon
surrender of this Warrant with a properly executed assignment (in the form of
Exhibit II hereto) at the principal office of the Company.
(c) 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; provided, however,
that if and when this Warrant is properly assigned 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,
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, to the Company at
its principal office set forth below. If the Company should at any time
change the location of its principal office to a place other than as set
forth below, it shall give prompt written notice to the Registered Holder of
this Warrant and thereafter all references in this Warrant to the location of
its principal office at the particular time shall be as so specified in
such notice.
13. No Rights as Stockholder. 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 which enforcement of the change or waiver is sought.
15. Headings. The headings in 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 laws of the Commonwealth of
Massachusetts.
17. Registration Rights. The Warrant Shares are subject to
the re-sale registration rights described in Section 5.10 of the Share
Exchange Agreement and Agreement and Plan of Merger dated November 11, 1998
by and among the Company and the Holder, among others.
Inso Corporation
By:________________________________
[Corporate Seal]
Title:_____________________________
ATTEST:
_________________________
EXHIBIT I
PURCHASE FORM
To:_________________ Dated:______________
The undersigned, pursuant to the provisions set forth in the
attached Warrant (No. ___), hereby irrevocably elects to purchase _____
shares of the Common Stock covered by such Warrant. The undersigned
herewith makes payment of $____________, representing the full purchase
price for such shares at the price per share provided for in such Warrant.
Signature:__________________________
Address:____________________________
____________________________
EXHIBIT II
ASSIGNMENT FORM
FOR VALUE RECEIVED,
________________________________________
hereby sells, assigns and transfers all of the rights of the undersigned
under the attached Warrant (No. ____) with respect to the number of shares of
Common Stock covered thereby set forth below, unto:
Name of Assignee Address No. of Shares
Dated:______________ Signature:_____________________
Dated:______________ Witness:______________________
