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Exhibit 1.2
WARRANT AGREEMENT
This Warrant Agreement (this "Agreement") dated as of ________, 1999 is by
and between AremisSoft Corporation, a Delaware corporation (the "Company") and
Cruttenden Xxxx Incorporated ("Cruttenden") and First Albany Corporation ("First
Albany").
WHEREAS, Cruttenden and First Albany have agreed pursuant to an
Underwriting Agreement dated ________, 1999 (the "Underwriting Agreement") to
act as the representatives (the "Representatives") of the several underwriters
in connection with the proposed public offering (the "Public Offering") by the
Company of 3,800,000 shares of Common Stock, including up to 570,000 additional
shares of Common Stock to cover over-allotments, if any; and
WHEREAS, pursuant to Section 1 of the Underwriting Agreement, the Company
has agreed to issue warrants (the "Warrants") to the Representatives to
purchase, at a price of $0.001 per warrant, up to an aggregate of 190,000 shares
(hereinafter, and as the number thereof may be adjusted hereto, the "Warrant
Shares") of the Company's Common Stock, $0.001 par value per share (the "Common
Stock"), each Warrant initially entitling the holder thereof to purchase one
share of Common Stock.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein and in the Underwriting Agreement set forth and for other good and
valuable consideration, the parties hereto agree as follows:
1. Issuance of Warrants; Form of Warrant. The Company will issue and
deliver to the Representatives, Warrants to purchase 190,000 Warrant Shares on
the Closing Date referred to in the Underwriting Agreement, in consideration
for, and as part of the Representatives' compensation in connection with, their
acting as representatives of the several underwriters for the Public Offering
pursuant to the Underwriting Agreement. The text of the Warrants and of the form
of election to purchase Warrants Shares shall be substantially as set forth in
Exhibit A attached hereto. The Warrants shall be executed on behalf of the
Company by the manual or facsimile signature of the Chairperson or Vice
Chairperson of the Board, President or Vice President of the Company, under its
corporate seal, affixed or in facsimile, attested by the manual or facsimile
signature of the Treasurer or an Assistant Treasurer or the Secretary or an
Assistant Secretary of the Company.
Warrants bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any one of them shall have ceased to
hold such offices prior to or after the delivery of such Warrants or did not
hold such offices on the date of this Agreement. Warrants shall be dated as of
the date of execution thereof by the Company either upon initial issuance or
upon division, exchange, substitution or transfer.
2. Registration. The Warrants shall be numbered and registered on the
books of the Company (the "Warrant Register") as they are issued. The Company
shall be entitled to treat the registered holder of any Warrant on the Warrant
Register (the "Holder") as the owner in fact therefor for all purposes and shall
not be bound to recognize any equitable or other claim to
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or interest in such Warrant on the part of any other person, and shall not be
liable for any registration or transfer of Warrants which are registered or are
to be registered in the name of a fiduciary or the nominee of a fiduciary unless
made with the actual knowledge that a fiduciary or nominee is committing a
breach of trust in requesting such registration or transfer, or with the
knowledge of such facts that its participation therein amounts to bad faith. The
Warrants shall be registered initially in the name of "Cruttenden Xxxx
Incorporated" and "First Albany Corporation," respectively, or in such other
names or denominations as Cruttenden or First Albany, respectively, may request
in writing to the Company.
3. Exchange of Warrant Certificates. Subject to any restriction upon
transfer set forth in this Agreement, each Warrant certificate may be exchanged
for another certificate or certificates entitling the Holder thereof to purchase
a like aggregate number of Warrant Shares as the certificate or certificates
surrendered then entitled such Holder to purchase. Any Holder desiring to
exchange a Warrant certificate or certificates shall make such request in
writing delivered to the Company, and shall surrender, properly endorsed, the
certificate or certificates to be so exchanged. Thereupon, the Company shall
execute and deliver to the person entitled thereto a new Warrant certificate or
certificates, as the case may be, as so requested.
4. Transfer of Warrants. Until __________, 2000, the Warrants will not be
sold, transferred, assigned or hypothecated except in compliance with the
Securities Act of 1933, as amended, to (i) other brokers or dealers; (ii) one or
more bona fide officers and/or partners of Cruttenden or First Albany, as the
case may be; (iii) a successor to the transferring Holder in merger or
consolidation; (iv) a purchaser of all or substantially all of the transferring
Holder's assets; or (v) any person receiving the Warrants from one or more of
the persons listed in this Section 4 at such person's or persons' death pursuant
to will, trust or the laws of intestate succession, each of whom agrees in
writing to be bound by the terms hereof. The Warrants shall be transferable only
on the Warrant Register upon delivery thereof duly endorsed by the Holder or by
the Holder's duly authorized attorney or representative, or accompanied by
proper evidence of succession, assignment or authority to transfer. In all cases
of transfer by an attorney, the original power of attorney, duly approved, or an
official copy thereof, duly certified, shall be deposited with the Company. In
case of transfer by executors, administrators, guardians or other legal
representatives, duly authenticated evidence of their authority shall be
produced and may be required to be deposited with the Company in its discretion.
Upon any registration of transfer, the Company shall deliver a new Warrant or
Warrants to the person entitled thereto.
5. Term of Warrants; Exercise of Warrants.
5.1 Each Warrant entitles the registered owner thereof to purchase
one share of Common Stock at any time from 10:00 a.m., Pacific time, on
__________, 2000 (the "Initiation Date") until 6:00 p.m., Pacific time, on
__________, 2004 (the "Expiration Date") at a purchase price of $__________
subject to adjustment as provided herein (the "Warrant Price"). Notwithstanding
the foregoing, if at 6:00 p.m., Pacific time on the Expiration Date, any Holder
or Holders of the Warrants have not exercised their Warrants and the Closing
Price (as defined in Section 11.1(c) below) for the Common Stock on the
Expiration Date is greater than the Warrant Price, then each such unexercised
Warrant shall be automatically converted into a number of shares of Common Stock
of the Company equal to: (A) the number of shares of Common Stock
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then issuable upon exercise of a Warrant multiplied by (B) a fraction (1) the
numerator of which is the difference between the Closing Price for the Common
Stock on the Expiration Date and the Warrant Price and (2) the denominator of
which is the Closing Price for the Common Stock on the Expiration Date.
5.2 The Warrant Price and the number of Warrant Shares issuable upon
exercise of each Warrant are subject to adjustment upon the occurrence of
certain events pursuant to the provisions of Section 11 of this Agreement.
Subject to the provisions of this Agreement, each Holder of Warrants shall have
the right, which may be exercised as expressed in the Warrant Certificate, to
purchase from the Company (and the Company shall issue and sell to such Holder
of Warrants) the number of fully paid and nonassessable Warrant Shares specified
in such Warrant Certificate, upon surrender to the Company, or its duly
authorized agent, of such Warrant Certificate, with the form of election to
purchase on the reverse thereof duly filled in and signed, and upon payment to
the Company of the Warrant Price, as adjusted in accordance with the provisions
of Section 11 of this Agreement, for the number of Warrant Shares in respect of
which such Warrants are then exercised. Payment of such Warrant Price shall be
made in cash, by wire transfer or by certified or official bank check, or any
combination thereof. No adjustment shall be made for any dividends on any
Warrant Shares issuable upon exercise of a Warrant.
5.3 Upon such surrender of Warrants, and payment of the Warrant Price
as aforesaid, the Company shall issue and cause to be delivered with all
reasonable dispatch to or upon the written order of the Holder of such Warrants
and in such name or names as such registered Holder may designate, a certificate
or certificates for the number of full Warrant Shares so purchased upon the
exercise of such Warrants, together with cash, as provided in Section 12 of this
Agreement, in respect of any fraction of a share otherwise issuable upon such
surrender and, if the number of Warrants represented by a Warrant certificate
shall not be exercised in full, a new Warrant certificate, executed by the
Company for the balance of the number of whole Warrant Shares.
5.4 In addition to the method of payment set forth above in this
Section 5 and in lieu of any cash payment required thereunder, the Holder(s) of
the Warrants shall have the right to exercise the Warrants in full or in part by
surrendering the Warrant certificate in the manner specified in Section 5.2 in
exchange for the number of Warrant Shares equal to the product of (x) the number
of Warrant Shares as to which the Warrants are being exercised multiplied by (y)
a fraction, the numerator of which is the Closing Price less the Warrant Price
and the denominator of which is such Closing Price. Solely for the purposes of
any computation under this Section 5.4, the Closing Price on any date shall be
deemed to be the average of the daily closing prices for the 20 consecutive
trading days before the date of such computation. The "Closing Price" for each
day shall be the last reported sales price regular way or, in case no such
reported sale takes place on such day, the average of the closing bid and asked
prices regular way for such day, in each case on the principal national
securities exchange on which the shares of Common Stock are listed or admitted
to trading or, if not listed or admitted to trading on such an exchange, the
average of the closing bid and asked prices in the over-the-counter market, as
reported by the Nasdaq National Market or Nasdaq SmallCap System, as reported by
the National Association of Securities Dealers' Automated Quotation System, or,
if not so reported, the average of the closing bid and asked prices as furnished
by two members of the national
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Association of Securities Dealers, Inc. selected from time to time by the Board
of Directors of the Company for that purpose, or, if no such prices are
furnished, the fair market value of a share of Common Stock as determined by the
Board of Directors of the Company.
5.5 If permitted by applicable law, such certificate or certificates
shall be deemed to have been issued and any person so designated to be named
therein shall be deemed to have become a holder of record of such shares as of
the date of the surrender of such Warrants and payment of the Warrant Price as
aforesaid. The rights of purchase represented by the Warrants shall be
exercisable, at the election of the registered Holders thereof, either as an
entirety or from time to time for only part of the shares specified therein.
6. Compliance with Government Regulations. The Company covenants that if
any shares of Common Stock required to be reserved for purposes of exercise or
conversion of Warrants require, under any Federal or state law or applicable
governing rule or regulation of any national securities exchange or
over-the-counter market, registration with or approval of any governmental
authority, listing on any such national securities exchange or approval of any
over-the-counter market before such shares may be issued upon exercise, the
Company will in good faith and as expeditiously as possible endeavor to cause
such shares to be duly registered, approved or listed on the relevant national
securities exchange, as the case may be.
7. Payment of Taxes. The Company will pay all documentary stamp taxes, if
any, attributable to the initial issuance of the Warrants or the securities
comprising the Warrant Shares upon the exercise of Warrants; provided, however,
that the Company shall not be required to pay any tax or taxes which may be
payable in respect of any transfer involved in the issue or delivery of any
Warrants or certificate for Warrant Shares in a name other than that of the
registered Holder of such Warrants.
8. Mutilated or Missing Warrants. In case any of the Warrants shall be
mutilated, lost, stolen or destroyed, the Company shall issue and deliver in
exchange and substitution for and upon cancellation of the mutilated Warrant, or
in lieu of and substitution for the Warrant lost, stolen or destroyed, a new
Warrant of like tenor and representing an equivalent right or interest; but only
upon receipt of evidence reasonably satisfactory to the Company of such loss,
theft or destruction of such Warrant and, if requested, indemnity or bond also
reasonably satisfactory to the Company. An applicant for such substitute
Warrants shall also comply with such other reasonable regulations and pay such
other reasonable charges as the Company may prescribe.
9. Reservation of Warrant Shares. There has been reserved out of the
authorized and unissued shares of Common Stock a number of shares sufficient to
provide for the exercise of the Warrants, and the transfer agent for the Common
Stock ("Transfer Agent") and every subsequent transfer agent for any shares of
the Company's capital stock issuable upon the exercise of the Warrants are
hereby irrevocably authorized and directed at all times until the Expiration
Date to reserve such number of authorized and unissued shares as shall be
required for such purpose. The Company will keep a copy of this Agreement on
file with the Transfer Agent and with every subsequent transfer agent for any
shares of the Company's capital stock issuable upon the exercise of the
Warrants. The Company will supply such Transfer Agent with duly executed stock
certificates for such purposes and will itself provide or otherwise make
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available any cash which may be issuable as provided in Section 12 of this
Agreement. The Company will furnish to such Transfer Agent a copy of all notices
of adjustments, and certificates related thereto, transmitted to each Holder
pursuant to Section 11.3 of this Agreement. All Warrants surrendered in the
exercise of the rights thereby evidenced shall be cancelled.
10. Obtaining Stock Exchange Listings. The Company will from time to time
take all action which may be necessary so that the Warrant Shares, immediately
upon their issuance upon the exercise of Warrants, will be listed on the
securities exchanges and stock markets or approved for quotation in the
over-the-counter markets within the United States of America, if any, on which
other shares of Common Stock are then listed.
11. Adjustment of Warrant Price and Number of Warrant Shares. The number
and kind of securities purchasable upon the exercise of each Warrant and the
Warrant Price shall be subject to adjustment from time to time upon the
happening of certain events as hereinafter defined. For purposes of this Section
11, "Common Stock" means shares now or hereafter authorized of any class of
common stock of the Company and any other stock of the Company, however
designated, that has the right (subject to any prior rights of any class or
series of preferred stock) to participate in any distribution of the assets or
earnings of the Company without limit as to per share amount.
11.1 Mechanical Adjustments. The number of Warrant Shares purchasable
upon the exercise of each Warrant and the Warrant Price shall be subject to
adjustment as follows:
(a) In case the Company shall (i) pay a dividend or make a
distribution in shares of Common Stock, (ii) subdivide its outstanding shares of
Common Stock, (iii) combine its outstanding shares of Common Stock or (iv) issue
by reclassification of its shares of Common Stock other securities of the
Company (including any such reclassification in connection with a consolidation
or merger in which the Company is the surviving corporation), the number of
Warrant Shares purchasable upon exercise of each Warrant immediately prior
thereto shall be adjusted so that the Holder of each Warrant shall be entitled
to receive the kind and number of Warrant Shares or other securities of the
Company which it would have owned or would have been entitled to receive after
the happening of any of the events described above, had such Warrants been
exercised immediately prior to the happening of such event or any record date
with respect thereto. An adjustment made pursuant to this paragraph (a) shall
become effective immediately after the effective date of such event retroactive
to the record date, if any, for such event. Such adjustment shall be made
successively whenever any event listed above shall occur.
(b) (i) In case the Company shall distribute to all holders of
its shares of Common Stock (including any such distribution made in connection
with a consolidation or merger in which the Company is the surviving
corporation) evidences of its indebtedness or assets (excluding cash dividends
or distributions payable out of consolidated earnings or earned surplus and
dividends or distributions referred to in paragraph (a) above or in subparagraph
(ii) below) or rights, options or warrants, or convertible or exchangeable
securities containing the right to subscribe for or purchase shares of Common
Stock, then in each case the number of Warrant Shares thereafter purchasable
upon the exercise of each Warrant shall be determined by
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multiplying the number of Warrant Shares theretofore purchasable upon the
exercise of each Warrant by a fraction, the numerator of which shall be the then
current market price per share of Common Stock (as defined in paragraph (c)
below) on the date of such distribution, and the denominator of which shall be
the then current market price per share of Common Stock, less the then fair
value (as reasonably determined by the Board of Directors of the Company) of the
portion of the assets or evidences of indebtedness so distributed or of such
rights, options or warrants, or of such convertible or exchangeable securities
applicable to one share of Common Stock. Such adjustment shall be made whenever
any such distribution is made and shall become effective on the date of
distribution retroactive to the record date for the determination of
stockholders entitled to receive such distribution.
(ii) In the event of a distribution by the Company to all
holders of its shares of Common Stock shares of capital stock of a subsidiary or
securities convertible into or exercisable for such stock, then in lieu of an
adjustment in the number of Warrant Shares purchasable upon the exercise of each
Warrant, the Holder of each Warrant, upon the exercise thereof at any time after
such distribution, shall be entitled to receive from the Company, such
subsidiary or both, as the Company shall determine, the stock or other
securities to which such Holder would have been entitled if such Holder had
exercised such Warrant immediately prior thereto, all subject to further
adjustment as provided in this Section 11.1; provided, however, that no
adjustment in respect of dividends or interest on such stock or other securities
shall be made during the term of a Warrant or upon the exercise of a Warrant.
(c) For the purpose of any computation under paragraph (b) of
this Section, the current market price per share of Common Stock at any date
shall be the average of the daily Closing Prices (as hereinafter defined) for 20
consecutive trading days commencing 30 trading days before the date of such
computation. The "Closing Price" for each day shall be the last reported sales
price regular way or, in case no such reported sale takes place on such day, the
average of the closing bid and asked prices regular way for such day, in each
case on the principal national securities exchange on which the shares of Common
Stock are listed or admitted to trading or, if not listed or admitted to
trading, the average of the closing bid and asked prices of the Common Stock in
the over-the counter market as reported by the Nasdaq National Market System or
Nasdaq SmallCap System or if not approved for quotation on the Nasdaq National
Market System or Nasdaq SmallCap System, the average of the closing bid and
asked prices as furnished by two members of the National Association of
Securities Dealers, Inc. selected from time to time by the Company for that
purpose, or if no prices are furnished, the fair market value of a share of
Common Stock as determined by the Board of Directors of the Company.
(d) Whenever the number of Warrant Shares purchasable upon the
exercise of each Warrant is adjusted, as herein provided, the Warrant Price
payable upon exercise of each Warrant shall be adjusted by multiplying such
Warrant Price immediately prior to such adjustment by a fraction, the numerator
of which shall be the number of Warrant Shares purchasable upon the exercise of
each Warrant immediately prior to such adjustment, and the denominator of which
shall be the number of Warrant Shares purchasable immediately thereafter.
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(e) No adjustment in the number of Warrant Shares purchasable
upon the exercise of each Warrant need be made under paragraph (b) if the
Company issues or distributes to each Holder of Warrants the rights, options,
warrants or convertible or exchangeable securities, or evidences of indebtedness
or assets referred to in those paragraphs which each Holder of Warrants would
have been entitled to receive had the Warrants been exercised prior to the
happening of such event or the record date with respect thereto. No adjustment
need be made for a change in the par value of the Warrant Shares.
(f) In the event that at any time, as a result of an adjustment
made pursuant to paragraph (a) above, the Holders shall become entitled to
purchase any securities of the Company other than shares of Common Stock,
thereafter the number of such other shares so purchasable upon exercise of each
Warrant and the Warrant Price of such shares shall be subject to adjustment from
time to time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Warrant Shares contained in this Section 11, and
the other provisions of this Agreement, with respect to the Warrant and Warrant
Shares, shall apply as nearly equivalent as practicable on like terms to such
other securities.
(g) Upon the expiration of any rights, options, warrants or
convertible or exchangeable securities for which an adjustment was made
hereunder, if any thereof shall not have been exercised, the Warrant Price and
the number of shares of Common Stock purchasable upon the exercise of each
Warrant shall, upon such expiration, be readjusted and shall thereafter be such
as it would have been had it been originally adjusted (or had the original
adjustment not been required, as the case may be) as if (i) the only rights,
options, warrants or convertible or exchangeable securities so issued were the
rights, options, warrants or convertible or exchangeable securities, if any,
actually exercised, converted or exchanged and (ii) such rights, options,
warrants or convertible or exchangeable securities, if any, were exercised,
converted or exchanged for the consideration actually received by the Company
upon such exercise, conversion or exchange plus the aggregate consideration, if
any, actually received by the Company for the issuance, sale or grant of all
such rights, options, warrants or convertible or exchangeable securities whether
or not exercised, converted or exchanged; provided, however, that no such
readjustment shall have the effect of increasing the Warrant Price or decreasing
the number of shares of Common Stock purchasable upon the exercise of each
Warrant by an amount in excess of the amount of the adjustment initially made in
respect to the issuance, sale or grant of such rights, options, warrants or
convertible or exchangeable securities.
11.2 Other Adjustments of Exercise Price and Number of Warrant Shares.
(a) In case the Company shall at any time after the date hereof
issue or sell any shares of Common Stock, including shares held in the Company's
treasury and shares of Common Stock issued upon the exercise of any options,
rights or warrants to subscribe for shares of Common Stock and shares of Common
Stock issued upon the direct or indirect conversion or exchange of securities
for shares of Common Stock, for a consideration per share less than the current
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 Warrant
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:
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(i) an amount equal to the sum of (x) the total number of
shares of Common Stock outstanding immediately prior to the issuance or sale of
such shares, multiplied by the Warrant Price in effect immediately prior to such
issuance or sale, and (y) the aggregate of the amount of all consideration, if
any, received by the Company upon such issuance or sale, by
(ii) the total number of shares of Common Stock outstanding
immediately after such issuance or sale; provided, however, that in no event
shall the Warrant Price be adjusted pursuant to this computation to an amount in
excess of the Warrant Price in effect immediately prior to such computation;
provided, further, that no adjustment shall be made pursuant to this Section
11.2(a) in connection with an issuance or sale of shares of Common Stock if an
adjustment was made pursuant to Section 11.2(b) in connection with the issuance
of the option, right or warrant to subscribe for shares of the Company's Common
Stock or the security convertible into or exchangeable for shares of Common
Stock, pursuant to which such shares of Common Stock are being issued or sold.
(b) 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 the current market price in
effect immediately prior to the issuance of such options, rights or warrants, or
such convertible or exchangeable securities, or without consideration, the
Warrant Price 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 Section 11.2(a) 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 weighted average 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 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 outstanding at the time of issuance
of such securities, and for a consideration equal to the consideration received
by the Company for such securities, plus the weighted average consideration, if
any, receivable by the Company upon the conversion or exchange thereof.
(iii) If any change shall occur in the price per share
provided for in any of the options, rights or warrants referred to in subsection
(b)(i) of this Section 11.2, or in the price per share at which the securities
referred to in subsection (b)(ii) of this Section 11.2 are convertible or
exchangeable (except for changes in the price per share as a result of
mechanical or other adjustments for which an adjustment has also been made to
the Warrant Price pursuant to this Agreement), 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
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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.
(iv) Upon expiration of any rights, options, warrants or
convertible or exchangeable securities for which an adjustment was made under
this Section 11.2(b), a readjustment shall be made in accordance with Section
11.1(g).
(c) Adjustment in Number of Warrant Shares. Upon each adjustment
of the Warrant Price pursuant to the provisions of this Section 11.2, the number
of Warrant Shares issuable upon the exercise of each Warrant shall be adjusted
to the nearest full Warrant Share by multiplying a number equal to the Warrant
Price in effect immediately prior to such adjustment by the number of Warrant
Shares issuable upon exercise of the Warrants immediately prior to such
adjustment and dividing the product so obtained by the adjusted Warrant Price.
11.3 No Adjustment; Notice of Adjustment.
(a) No adjustment in the number of Warrant Shares purchasable
hereunder shall be required unless such adjustment would require an increase or
decrease of at least one percent (1%) in the number of Warrant Shares
purchasable upon the exercise of each Warrant; provided, however, that any
adjustments which by reason of this paragraph (a) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations shall be made to the nearest one-thousandth of a share.
(b) Whenever the number of Warrant Shares purchasable upon the
exercise of each Warrant or the Warrant Price of such Warrant Shares is
adjusted, as herein provided, the Company shall promptly mail by first class,
postage prepaid, to each Holder notice of such adjustment or adjustments and a
certificate of a firm of independent public accountants selected by the Board of
Directors of the Company (who may be the regular accountants employed by the
Company) setting forth the number of Warrant Shares purchasable upon the
exercise of each Warrant and the Warrant Price of such Warrant Shares after such
adjustment, setting forth a brief statement of the facts requiring such
adjustment and setting forth the computation by which such adjustment was made.
11.4 No Adjustment for Dividends. Except as provided in Section 11.1,
no adjustments in respect of any dividends shall be made during the term of a
Warrant or upon the exercise of a Warrant.
11.5 Preservation of Purchase Rights Upon Merger, Consolidation etc.
In case of any consolidation of the Company with or merger of the Company into
another corporation or in case of any sale, transfer or lease to another
corporation of all or substantially all the property of the Company, the Company
or such successor or purchasing corporation, as the case may be, shall execute
with each Holder an agreement that each Holder shall have the right thereafter
upon payment of the Warrant Price in effect immediately prior to such action to
purchase upon exercise of each Warrant the kind and amount of shares and other
securities, cash and property which it would have owned or would have been
entitled to receive after the happening of such
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consolidation, merger, sale, transfer or lease had such Warrant been exercised
immediately prior to such action; provided, however, that no adjustment in
respect of dividends, interest or other income on or from such shares or other
securities, cash and property shall be made during the term of a Warrant or upon
the exercise of a Warrant. Such agreement shall provide for adjustments, which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section 11. The provisions of this Section 11.5 shall similarly
apply to successive consolidations, mergers, sales transfer or leases.
11.6 Statements on Warrants. Irrespective of any adjustments in the
Warrant Price or the number or kind of shares purchasable upon the exercise of
the Warrants, Warrants theretofore or thereafter issued may continue to express
the same price and number and kind of shares as are stated in the Warrants
initially issuable pursuant to this Agreement.
11.7 No Adjustment for Securities Issued Pursuant to Employee Benefit
Plans. No adjustment to the Warrant Price or Warrant Shares shall be made
pursuant to Section 11.1 or 11.2 hereof for securities issued to pursuant to the
Company's 1998 Stock Option Plan and other employee benefit plans.
12. Fractional Interests. The Company shall not be required to issue
fractional Warrant Shares on the exercise of Warrants. If more than one Warrant
shall be presented for exercise in full at the sale time by the same Holder, the
number of full Warrant Shares which shall be issuable upon the exercise thereon
shall be computed on the basis of the aggregate number of Warrant Shares
purchasable on exercise of the Warrants so presented. If any fraction of a
Warrant Share would, except for the provisions of this Section 12 be issuable on
the exercise of any Warrant (or specified portion thereof), the Company shall
pay an amount in cash equal to the Closing Price for one share of the Common
Stock, as defined in Section 11.1(c), on the trading day immediately preceding
the date the Warrant is presented for exercise, multiplied by such fraction.
13. Registration Under the Securities Act of 1933. Cruttenden and First
Albany each represent and warrant to the Company that it will not dispose of the
Warrants or the Warrant Shares except pursuant to (i) an effective registration
statement under the Securities Act of 1933, as amended (the "Act"), (ii) Rule
144 under the Act (or any similar rule under the Act relating to the disposition
of securities), or (iii) an opinion of counsel, reasonably satisfactory to
counsel of the Company, that an exemption from such registration is available.
14. Certificates to Bear Legends. Until such time as the Warrant, the
Warrant Shares or other securities issued upon exercise of the Warrants have
been registered under the Act, such securities shall be subject to a
stop-transfer order and the certificate or certificates therefore shall bear the
following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAW. SAID SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT.
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15. Registration Rights.
15.1 Demand Registration Rights. The Company covenants and agrees with
the Representatives and any subsequent Holders of the Warrants and/or Warrant
Shares that, at any time and from time to time prior to the Expiration Date,
within 60 days after receipt of a written request from the Representatives or
from Holders of more than 25% in interest of the aggregate of Warrants and/or
Warrant Shares issued pursuant to this Agreement that the Representatives or
such Holders of the Warrants and/or Warrant Shares desire and intend to transfer
more than 25% in interest of the aggregate number of the Warrants and/or Warrant
Shares under such circumstances that a public offering, within the meaning of
the Act, will be involved, the Company shall file a registration statement (and
use its best efforts to cause such registration statement to become effective
under the Act) with respect to the offering and sale or other disposition of the
Warrant Shares (the "Offered Warrant Shares").
The Company may defer the preparation and filing of a registration
statement for up to 90 days after the request for registration is made if the
Board of Directors determines in good faith that such registration would
materially adversely affect or otherwise materially interfere with a proposed or
pending transaction by the Company, including without limitation a material
financing or a corporate reorganization, or during any period of time in which
the Company is in possession of material inside information concerning the
Company or its securities, which information the Company determines in good
faith is not ripe for disclosure.
The Company shall not honor any request to register Warrant Shares
pursuant to this Section 15.1 (i) received earlier than eleven (11) months or
later than five (5) years from the effective date of the Company's Registration
Statement on Form S-1 (File No. 333-58351) (the "Effective Date"), (ii) if the
Holders, together with the holders of any other securities of the Company
entitled to inclusion in such registration, propose to sell Warrant Shares and
such other securities, if any, at an aggregate price to the public of less than
$1,000,000, (iii) if the Company shall defer preparation and filing of a
registration statement pursuant to Section 15.1, (iv) if, in a given 12-month
period, after the Company has effected one (1) such registration in any such
period pursuant to this Section 15.1 unless the Company is eligible to use Form
S-3 or similar short form registration statement, (v) during the period starting
with the date 60 days prior to the Company's good faith estimate of the date of
filing of, and ending on a date 180 days after the effective date of, a
Company-initiated registration; provided that the Company is actively employing
in good faith all reasonable efforts to cause such registration statement to
become effective, or (vi) if the Offered Warrant Shares can immediately be sold
pursuant to Rule 144 over a period of 90 days or less except as to a Holder who
owns more than one percent (1%) of the Company's outstanding Common Stock. The
Company shall not be required to maintain the effectiveness of the registration
statement beyond the earlier to occur of 120 days after the effective date of
the registration statement or the date on which all of the Offered Warrant
Shares have been sold (the "Termination Date"); provided, however, that if at
the Termination Date the Offered Warrant Shares are covered by a registration
statement which also covers other securities and which is required to remain in
effect beyond the Termination Date, the Company shall maintain in effect such
registration statement as it relates to Offered Warrant Shares for so long as
such registration statement (or any substitute registration statement) remains
or is required to remain in effect for any such other securities. All expenses
of one registration which is consummated pursuant to this Section 15.1 shall be
borne by the Company (excluding
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underwriting discounts and commissions on Warrant Shares and fees and
disbursements of counsel for any Holder). All expenses of any subsequent
registration pursuant to this Section 15.1 shall be borne by the Representatives
and/or the Holders requesting such registration.
The Company shall be obligated pursuant to this Section 15.1 to
include in the registration statement Warrant Shares that have not yet been
purchased by a Holder of Warrants. In addition, such Holder of Warrants is
permitted to pay the Company the Warrant Price for such Warrant Shares upon the
consummation of the public offering with respect to such Warrant Shares.
15.2 Piggy-back Registration Rights. The Company covenants and agrees
with the Holders and any subsequent Holders of the Warrants and/or Warrant
Shares that in the event the Company proposes to file a registration statement
under the Act with respect to any class of security (other than in connection
with a Rule 145 transaction an exchange offer, a non-cash offer or a
registration statement on Form S-8 or other registration statement form that
does not permit secondary sales) which becomes or which the Company believes
will become effective at any time after the Initiation Date, then the Company
shall in each case give written notice of such proposed filing to the Holders of
Warrants and Warrant Shares at least 30 days before the proposed filing date and
such notice shall offer to such Holders the opportunity to include in such
registration statement such number of Warrant Shares as they may request. The
Company shall not be required to honor any such request to register any such
Warrant Shares (i) if the request is received later than six (6) years from the
Effective Date, or (ii) if the Company is not notified in writing of any such
request pursuant to this Section 15.2 within at least 20 days after the Company
has given notice to the Holders of the filing. The Company shall permit, or
shall cause the managing underwriter of a proposed offering to permit, the
Holders of Warrant Shares requested to be included in the registration (the
"Piggy-back Shares") to include such Piggy-back Shares in the proposed offering
on the same terms and conditions as applicable to securities of the Company
included therein or as applicable to securities of any person other than the
Company and the Holders of Piggy-back Shares if the securities of any such
person are included therein. Notwithstanding the foregoing, if any such managing
underwriter shall advise the Company in writing that it believes marketing
factors require a limitation on the number of shares to be underwritten in the
proposed offering, then the Holders of such Piggy-back Shares shall delay their
offering and sale of Piggy-back Shares (or the portion thereof so designated by
such managing underwriter) for such period, not to exceed 180 days, as the
managing underwriter shall request.
In any circumstance in which all of the Warrant Shares and other
shares of Common Stock of the Company (including shares of Common Stock issued
or issuable upon exercise of warrants or conversion of any subordinated note of
the Company) with registration rights (the "Other Shares") requested to be
included in a registration on behalf of the Holders or other selling
stockholders cannot be so included as a result of limitations of the aggregate
number of Warrant Shares and Other Shares that may be so included, the number of
shares of Warrant Shares and Other Shares that may be so included shall be
allocated among the Holders and other selling stockholders requesting inclusion
of shares pro rata on the basis of the number of shares of Warrant Shares and
Other Shares that would be held by such Holders and other selling stockholders,
assuming exercise or conversion; provided, however, so that such allocation
shall not operate to reduce the aggregate number of Warrant Shares and Other
Shares to be
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included in such registration, if any Holder or other selling stockholder does
not request inclusion in the maximum number of Warrant Shares and Other Shares
allocated to him pursuant to the above-described procedure, the remaining
portion of his allocation shall be reallocated among those requesting Holders
and other selling stockholders whose allocations did not satisfy their requests
pro rata on the basis of the number of Warrant Shares and Other Shares which
would be held by such Holders and other selling stockholders, assuming exercise
or conversion, and this procedure shall be repeated until all of the Warrant
Shares and Other Shares which may be included in the registration on behalf of
the Holders and other selling stockholders have been so allocated. The Company
shall not limit the number of Warrant Shares to be included in a registration
pursuant to this Agreement in order to include shares held by stockholders with
no registration rights or to include founder's stock or any other shares of
stock issued to employees, officers, directors, or consultants pursuant to
Company's 1998 Stock Option Plan.
All expenses of registration pursuant to this Section 15.2 shall be
borne by the Company, except that underwriting commissions and expenses
attributable to the Piggy-back Shares and fees and disbursements of counsel (if
any) to the Holders requesting that such Piggy-back Shares be offered will be
borne by such Holders.
If the registration of which the Company gives notice is for a
registered public offering involving an underwriting, the Company shall so
advise the Holders as a part of the written notice given pursuant to this
Section 15.2. In such event, the right of any Holder to registration pursuant to
this Section 15.2 shall be conditioned upon such holder's participation in such
underwriting and the inclusion of such Holder's Warrant Shares in the
underwriting to the extent provided herein. All Holders proposing to distribute
their securities through such underwriting shall (together with the Company and
the other holders of securities of the Company with registration rights to
participate therein distributing their securities through such underwriting)
enter into an underwriting agreement in customary form with the representative
of the underwriter or underwriters selected by the Company.
The Company shall be obligated pursuant to this Section 15.2 to
include in the Piggy-back offering, Warrant Shares that have not yet been
purchased by a holder of Warrants. In addition, such Holder of Warrants is
permitted to pay the Company the Warrant Price for such Warrant Shares upon the
consummation of the Piggy-back offering.
If the Company decides not to proceed with a Piggy-back offering, the
Company has no obligation to proceed with the offering of the Piggy-back Shares,
unless the Holders of the Warrants and/or Warrant Shares otherwise comply with
the provisions of Section 15.1 hereof (without regard to the 60 days' written
request required thereby). Notwithstanding any of the foregoing contained in
this Section 15.2, the Company's obligation to offer registration rights to the
Piggy-back Shares pursuant to this Section 15.2 shall terminate two (2) years
after the Expiration Date.
15.3 State Securities Laws. In connection with the registration of
Warrant Shares in accordance with Section 15.1 and 15.2 above, the Company
agrees to use its best efforts to register or qualify the Warrant Shares for
offer or sale under the state securities or Blue Sky laws of such states which
the Holders of such Warrant Shares shall designate, until the dates specified in
Section 15.1 and 15.2 above in connection with registration under the Act;
provided,
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however, that in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any
action which would subject it to general service of process in any jurisdiction
where it is not now so subject or to register or get a license as a broker or
dealer in securities in any jurisdiction where it is not so registered or
licensed or to register or qualify the Warrant Shares for offer or sale under
the state securities or Blue Sky laws of any state other than the states in
which some or all of the shares offered or sold in the Public Offering were
registered or qualified for offer and sale.
15.4 Indemnification.
(a) In the event of any registration with respect to any Warrant
Shares pursuant to Section 15.1 or 15.2 above, the Company will indemnify and
hold harmless any Holder whose Warrant Shares are so registered, and each
person, if any, who controls such Holder within the meaning of the Act, against
any losses, claims, damages or liabilities, joint or several, to which such
Holder or such controlling person may be subject, under the Act or otherwise,
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 of any material fact contained, in any such registration statement,
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 each such Holder and each such controlling person for any legal or
other expenses reasonably incurred by such Holder or such controlling person in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon any untrue statement or alleged untrue statement or
omission or alleged omission made in any such registration statement, any
preliminary prospectus or final prospectus, or any amendment or supplement
thereto, in reliance upon and in conformity with written information furnished
by such Holder expressly for use in the preparation thereof. The Company will
not be liable to a claimant to the extent of any misstatement or omission
corrected or remedied in any amended prospectus if the Company timely delivers a
copy of such amended prospectus to such indemnified person and such indemnified
person does not timely furnish such amended prospectus to such claimant. The
Company shall not be required to indemnify any Holder or controlling person for
any payment made to any claimant in settlement of any suit or claim unless such
payment is approved by the Company in writing.
(b) Each Holder of Warrants and/or Warrant Shares who
participates in a registration pursuant to Section 15.1 or 15.2 will indemnify
and hold harmless the Company, each of its directors, each of its officers who
have signed any such registration statement, and each person, if any, who
controls the Company within the meaning of the Act, against any losses, claims,
damages or liabilities to which the Company, or any such director, officer or
controlling person may become subject under the Act, or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue or alleged untrue statement or any
material fact contained in any such registration statement, any preliminary
prospectus or final prospectus, or any amendment or supplement thereto, or arise
out of or are based upon the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to
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the extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in any such registration
statement, any preliminary prospectus or final prospectus, or any amendment or
supplement thereto, in reliance upon and in conformity with written information
furnished by such Holder expressly for use in the preparation thereof; and will
reimburse any legal or other expenses reasonably incurred by the Company, or any
such director, officer or controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the indemnity agreement contained in this paragraph (b) shall not apply to
amounts paid to any claimant in settlement of any suit or claim unless such
payment is first approved by such Holder.
(c) In order to provide for just and equitable contribution in
any action in which a claim for indemnification is made pursuant to this Section
15.4 but is judicially determined (by the entry of a final judgment or decree by
a court of competent jurisdiction and the expiration of time to appeal or the
denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that paragraphs (a) and (b) of
Section 15.4 provides for indemnification in such case, all the parties hereto
shall contribute to the aggregate losses, claims, damages or liabilities to
which they may be subject (after contribution from others) in such proportion so
that each Holder whose Warrant Shares are being registered is responsible pro
rata for the portion represented by the public offering price received by such
Holder from the sale of such Holder's Warrant Shares (less underwriting
discounts and commissions), and the Company is responsible for the remaining
portion; provided, however, that (i) no Holder shall be required to contribute
any amount in excess of the public offering price received by such Holder from
the sale of such Holder's Warrant Shares (less underwriting discounts and
commissions) and (ii) no person guilty of a fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who is not guilty of such fraudulent misrepresentation. This
paragraph (c) shall not be operative as to any Holder of Warrant Shares to the
extent that indemnity has been received under paragraph (a) or (b), as the case
may be, of Section 15.4.
15.5 No Rights as Stockholder; Notices to Holders. Nothing contained
in this Agreement or in any of the Warrants shall be construed as conferring
upon the Holders or their transferee(s) the right to vote or to receive
dividends or to consent to or receive notice as stockholders in respect of any
meeting of stockholders for the election of directors of the Company or any
other matter or any rights whatsoever as stockholders of the Company. If,
however, at any time prior to the expiration of the Warrants and prior to their
exercise, any of the following events occur:
(a) the Company shall declare any dividend payable in any
securities upon its shares of Common Stock or make any distribution (other than
a cash dividend) to the holders of its shares of Common Stock: or
(b) the Company shall offer to the holders of its shares of
Common Stock any additional shares of Common Stock or securities convertible
into or exchangeable for shares of Common Stock or any right to subscribe to or
purchase any thereof; or
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(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation, merger, sale, transfer or lease
of all or substantially all of its property, assets and business as an entirety)
shall be proposed;
then in any one or more of said events the Company shall (i) give notice in
writing of such event to the Holders, as provided in Section 16 hereof and (ii)
if there are more than 100 Holders, cause notice of such event to be published
once in The Wall Street Journal (national edition), such giving of notice and
publication to be completed at least 20 days prior to the date fixed as a record
date or the date of closing the transfer books for the determination of the
stockholders entitled to such dividend, distribution or subscription rights, or
for the determination of stockholders entitled to vote on such proposed
dissolution, liquidation or winding up. Such notice shall specify such record
date or the date of closing the transfer books, as the case may be. Failure to
publish, mail or receive such notice or any defect therein or in the publication
or mailing thereof shall not affect the validity of any action taken in
connection with such dividend, distribution or subscription rights, or such
proposed dissolution, liquidation or winding up.
15.6 Information by Holder. Each Holder shall furnish to the Company
such information regarding such Holder and the distribution proposed by such
Holder as the Company may reasonably request in writing and as shall be
reasonably required in connection with any registration, qualification, or
compliance referred to in Section 15.1 or 15.2.
15.7 Delay of Registration. No Holder shall have any right to take any
action to restrain, enjoin, or otherwise delay any registration as the result of
any controversy that might arise with respect to the interpretation or
implementation of this Section 15.
15.8 Termination of Registration Rights. The right of any Holder to
request registration or inclusion in any registration pursuant to Section 15.1
or 15.2 shall terminate on the date on which all Warrant Shares held or entitled
to be held upon exercise by such Holder may immediately be sold under Rule 144
during any 90 day period; provided, however, that the provisions of this Section
15.8 shall not apply to any Holder who owns more than one percent (1%) of the
Company's outstanding Common Stock until such time as such Holder owns less than
one percent (1%) of the Company's outstanding Common Stock.
16. Notices. Any notice pursuant to this Agreement to be given or made by
the registered Holder of any Warrant to the Company shall be sufficiently given
or made if sent by first-class mail or facsimile to:
AremisSoft Corporation
00 Xxxxxxxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Attn: Dr. Lycourgos X. Xxxxxxxxx
Fax: 000-00-000-000-0000
With a copy to:
Xxxxxx Eng Linn & Xxxxxxxx
000 Xxxxxxx Xxxx, Xxxxx 0000
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Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
Notices or demands authorized by this Agreement to be given or made by the
Company to the registered Holder of any Warrant shall be sufficiently given or
made (except as otherwise provided in this Agreement) if sent by first-class
mail to such Holder at the address of such Holder as shown on the Warrant
Register.
17. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California without giving effect to
principles of conflicts of laws.
18. Supplements and Amendments. The Company and the Representatives may
from time to time supplement or amend this Agreement in order to cure any
ambiguity or to correct or supplement any provision contained herein, or to make
any other provisions in regard to matters or questions arising hereunder which
the Company and the Representatives may deem necessary or desirable and which
shall not be inconsistent with the provisions of the Warrants and which shall
not adversely affect the interests of the Holders. This Agreement may also be
supplemented or amended from time to time by a writing executed by or on behalf
of the Company and the Holders of a majority of the Warrants or Warrant Shares
then outstanding.
19. Successor. All the covenants and provisions of this Agreement by or
for the benefit of the Company or the Holders shall bind and inure to the
benefit of their respective successors and assigns hereunder. Assignments by the
Holders of their rights hereunder shall be made in accordance with Section 4
hereof.
20. Merger or Consolidation of the Company. So long as Warrants remain
outstanding, the Company will not merge or consolidate with or into, or sell,
transfer or lease all or substantially all of its property to, any other
corporation unless the successor or purchasing corporation (if not the Company),
as the case may be, shall expressly assume, by supplemental agreement executed
and delivered to the Holders, the due and punctual performance and observance of
each and every covenant and condition of this Agreement to be performed and
observed by the Company.
21. Benefits of this Agreement. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and the
Holders, any legal or equitable right, remedy or claim under this Agreement, but
this Agreement shall be for the sole and exclusive benefit of the Company any
the Holders of the Warrants and Warrant Shares.
22. Captions. The captions of the sections and subsections of this
Agreement are for convenience only and shall have no substantive effect.
23. Counterparts. This Agreement may be executed in any number of
counterparts each of which when so executed shall be deemed to be an original;
but such counterparts together shall constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day, month and year first above written.
CRUTTENDEN XXXX INCORPORATED
Attest: By:
-------------------------- -------------------------------------
Name:
-------------------------------
Title:
------------------------------
FIRST ALBANY CORPORATION
Attest: By:
-------------------------- -------------------------------------
Name:
-------------------------------
Title:
------------------------------
AREMISSOFT CORPORATION
Attest: By:
-------------------------- -------------------------------------
Name:
-------------------------------
Title:
------------------------------
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EXHIBIT A
[Form of Warrant Certificate]
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAW. SAID
SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR
AN EXEMPTION THEREFROM UNDER SAID ACT
WARRANT CERTIFICATE
OF
AREMISSOFT CORPORATION
EXERCISABLE ON OR BEFORE _________, 2004
No. 1 [#] Warrants
This Warrant Certificate certifies that the registered holder hereof or its
registered assigns, is the registered holder of Warrants expiring __________,
2004 (the "Warrants") to purchase Common Stock, $0.001 par value per share (the
"Common Stock"), of AremisSoft Corporation, a Delaware corporation (the
"Company"). Each Warrant entitles the holder upon exercise to receive from the
Company from 10:00 a.m., Pacific time, on __________, 2000 through and until
6:00 p.m., Pacific time, on __________, 2004, one fully paid and nonassessable
share of Common Stock (a "Warrant Share") at the initial exercise price (the
"Warrant Price") of $[120%] payable in lawful money of the United States of
America upon surrender of this Warrant Certificate and payment of the Warrant
Price on the terms and conditions set forth herein and in the Warrant Agreement
referred to on the reverse hereof. The Warrant Price and number of Warrant
Shares issuable upon exercise of the Warrants are subject to adjustment upon the
occurrence of certain events set forth in the Warrant Agreement.
No Warrant may be exercised after 6:00 p.m., Pacific Time, on __________,
2004 (the "Expiration Date"). Notwithstanding the foregoing, if at 6:00 p.m.,
Pacific time on the Expiration Date, any Holder or Holders of the Warrants have
not exercised their Warrants and the Closing Price (as defined in the Warrant
Agreement) for the Common Stock on the Expiration Date is greater than the
Warrant Price, then each such unexercised Warrant shall be automatically
converted into a number of shares of Common Stock of the Company equal to: (A)
the number of shares of Common Stock then issuable upon exercise of a Warrant
multiplied by (B) a fraction (1) the numerator of which is the difference
between the Closing Price for the Common Stock on the Expiration Date and the
Warrant Price and (2) the denominator of which is the Closing Price for the
Warrant Stock on the Expiration Date.
Reference is hereby made to the further provisions of this Warrant
Certificate set forth on the reverse hereof and such further provisions shall
for all purposes have the same effect as though fully set forth herein.
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This Warrant Certificate shall not be valid unless countersigned by the
Company.
IN WITNESS WHEREOF, AremisSoft Corporation has caused this Warrant
Certificate to be signed by its Chairman and Chief Executive Officer and by its
President and Chief Financial Officer and has caused its corporate seal to be
affixed hereunto or imprinted hereon.
Dated: , 1999 AREMISSOFT CORPORATION
-----------
Attest:
----------------------- ------------------------
Secretary, Dr. Lycourgos X. Xxxxxxxxx
Treasurer, Chairman and Chief Executive Officer
Assistant Secretary
or Assistant Treasurer
------------------------
Roys Poyiadjis
President and Chief Financial Officer
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[Form of Warrant Certificate]
[Reverse]
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants expiring __________, 2004 entitling the holder on
exercise to receive shares of Common Stock, $0.001 par value per share, of the
Company (the "Common Stock"), and are issued or to be issued pursuant to a
Warrant Agreement, dated as of __________, 1999 (the "Warrant Agreement"), duly
executed and delivered by the Company, which Warrant Agreement is hereby
incorporated by reference in and made a part of this instrument and is hereby
referred to for a description of the rights, limitation of rights, obligations,
duties and immunities thereunder of the Company and the holders (the words
"holders" or "holder" meaning the registered holders or registered holder) of
the Warrants. A copy of the Warrant Agreement may be obtained by the holder
hereof upon written request to the Company.
The Warrants may be exercised commencing ____________, 2000 at any time on
or before __________, 2004. The holder of Warrants evidenced by this Warrant
Certificate may exercise them by surrendering this Warrant Certificate, with the
form of election to purchase set forth hereon properly completed and executed,
together with payment of the Warrant Price at the office of the Company
designated for such purpose. In the event that upon any exercise of Warrants
evidenced hereby the number of Warrants exercised shall be less than the total
number of Warrants evidenced hereby, there shall be issued to the holder hereof
or its assignee a new Warrant Certificate evidencing the number of Warrants not
exercised. No adjustment shall be made for any dividends on any Common Stock
issuable upon exercise of this Warrant.
The Warrant Agreement provides that upon the occurrence of certain events
the number of shares of Common Stock issuable upon the exercise of each Warrant
shall be adjusted. If the number of shares of Common Stock issuable upon such
exercise is adjusted, the Warrant Agreement provides that the Warrant Price set
forth on the face hereof may, subject to certain conditions, be adjusted. No
fractions of a share of Common Stock will be issued upon the exercise of any
Warrants but the Company will pay the cash value thereof determined as provided
in the Warrant Agreement. The Warrant Agreement also provides that, while the
Warrants are exercisable, the holders of the Warrants shall have an option to
exercise, without payment of any exercise price or any cash or other
consideration by such holders, the Warrants or any portion thereof into a number
of shares of Common Stock as specified in the Warrant Agreement.
The holders of the Warrants are entitled to certain registration rights
with respect to the Warrants or Common Stock purchasable upon exercise thereof.
Said registration rights are set forth in full in the Warrant Agreement.
Warrant Certificates, when surrendered at the office of the Company by the
registered holder thereof in person or by legal representative or attorney duly
authorized in writing, may be exchanged, in the manner and subject to the
limitations provided in the Warrant Agreement, but without payment of any
service charge, for another Warrant certificate or Warrant Certificates of like
tenor evidencing in the aggregate a like number of Warrants.
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Upon due presentation for registration of transfer of this Warrant
Certificate at the office of the Company, a new Warrant Certificate or Warrant
Certificates of like tenor and evidencing in the aggregate a like number of
Warrants shall be issued to other transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided in the Warrant Agreement,
without charge except for any tax or other governmental charge imposed in
connection therewith.
The Company may deem and treat the registered holder(s) thereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, of any distribution to the holder(s) hereof and for all other
purposes, and the Company shall not be affected by any notice to the contrary.
Neither the Warrants nor this Warrant Certificate entitles any holder hereof to
any rights of a stockholder of the Company.
22
23
(Form of Election to Purchase)
(To be Executed upon Exercise of Warrant)
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to receive ____________ shares of
Common Stock and herewith tenders payment for such shares in accordance with the
terms of the Warrant Agreement. The undersigned requests that a certificate for
such shares be registered in the name of ______________________________________,
whose address is ______________________________________ and that such shares be
delivered to _______________________ whose address is
________________________________________. If said number of shares is less than
all of the shares of Common Stock purchasable hereunder, the undersigned
requests that a new Warrant Certificate representing the remaining balance of
such shares be registered in the name of ________________________, whose address
is _______________________, and that such Warrant Certificate be delivered to
_______________________, whose address is _________________________________.
Signature:
------------------------------
Date:
-------------------
Signature Guaranteed:
-------------------
23
24
(Form of Assignment)
(To be Executed upon Assignment of Warrants)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
(Name and Address of Assignee Must Be Printed or Typewritten)
--------------------------------------------------
--------------------------------------------------
--------------------------------------------------
the within Warrants, hereby irrevocably constituting and appointing
________________ Attorney to transfer said Warrants on the books of the Company,
with full power of substitution in the premises.
Dated: -----------------------------------------
-------------- Signature of Registered Holder
Note: The signature on this assignment must correspond with the name as it
appears upon the face of the within Warrant Certificate in every particular,
without alteration or enlargement or any change whatever.
Signature Guaranteed:
--------------------------
(Signature must be guaranteed by a bank or trust company having an office or
correspondent in the United States or by a member firm of a registered
securities exchange or the National Association of Securities Dealers, Inc.)
24
