Exhibit 10.20
NEITHER THIS WARRANT NOR THE SHARES ISSUABLE UPON THE EXERCISE OF THIS WARRANT
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS THEY HAVE BEEN REGISTERED UNDER THE ACT AND APPLICABLE STATE
SECURITIES LAWS OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.
HEALTHGATE DATA CORP.
WARRANT FOR COMMON STOCK
April 21, 1999
VOID AFTER APRIL 21, 2002
THIS CERTIFIES that, for value received, XXXX XXXXXXXX XXXXXXX, a
division of Xxxx Xxxxxxxx Incorporated, or its registered assigns, is entitled
to subscribe for and purchase from HEALTHGATE DATA CORP., a Delaware corporation
(hereinafter called the "Corporation"), at the price of $11.45 per share (such
price, as it may be from time to time adjusted as hereinafter provided, being
hereinafter called the "Warrant Exercise Price"), at any time after April 21,
2000 and on or prior to April 21, 2002, up to 5460 (subject to adjustment as
hereinafter provided) fully paid and nonassessable shares of Common Stock, $.01
par value (hereinafter called the "Common Stock"), of the Corporation, subject,
however, to the provisions and upon the terms and conditions hereinafter set
forth. This Warrant, each such other warrant and any warrant or warrants
subsequently issued upon exchange or transfer hereof or thereof are hereinafter
collectively called the "Warrants."
Section 1. EXERCISE OF WARRANT.
(a) METHOD OF EXERCISE. The rights represented by this Warrant may be
exercised by the holder hereof, in whole at any time or from time to time in
part, but not as to a fractional share of Common Stock, by the surrender of this
Warrant, together with a written notice of exercise (a "Notice of Exercise") and
payment, at the office of the Corporation specified in or pursuant to Section 8
hereof. The Exercise Price shall be payable at the option of the holder (i) by
certified check, or (ii) if the Corporation's common stock is publicly traded,
pursuant to the cashless exercise provision set forth in Section 1(b).
(b) CASHLESS EXERCISE. If at the time the Warrant is exercised, the
Corporation's common stock has been publicly traded for at least thirty (30)
trading days, in lieu of payment of the Exercise Price in cash, at the option of
the holder, the holder may in the Notice of Exercise request a net issuance
exercise, in which event, the Corporation shall issue to the holder hereof a
number of shares of Common Stock equal to (A) the number of shares of Common
Stock
acquirable upon exercise in full of this Warrant (or, if applicable, the portion
hereof being exercised), as at such date, multiplied by (B) the balance
remaining after deducting (x) the Warrant Exercise Price, as in effect on such
date, from (y) the fair market value of one share of Common Stock as at such
date and dividing the result by (C) such fair market value.
For purposes of this section (b), the fair market value of the Common
Stock shall be determined as follows: if the Common Stock is listed or admitted
to trading on one or more national securities exchanges, the average of the last
reported sales prices per share regular way or, in case no such reported sales
takes place on any such day, the average of the last reported bid and asked
prices per share regular way, in either case on the principal national
securities exchange on which the Common Stock is listed or admitted to trading,
for the thirty (30) trading days immediately preceding the date upon which the
fair market value is determined (the "Determination Date"); if the Common Stock
is not listed or admitted to trading on a national securities exchange but is
quoted by the NASD Automated Quotation System ("NASDAQ"), the average of the
last reported sales prices per share regular way or, in case no reported sale
takes place on any such day or the last reported sales prices are not then
quoted by NASDAQ, the average for each such day of the last reported bid and
asked prices per share, for the thirty (30) trading days immediately preceding
the Determination Date as furnished by the National Quotation Bureau
Incorporated or any similar successor organization.
(c) DELIVERY OF CERTIFICATES, ETC. In the event of any exercise of the
rights represented by this Warrant, a certificate or certificates for the shares
of Common Stock so purchased, registered in the name of the holder, shall be
delivered to the holder hereof within a reasonable time, not exceeding ten (10)
business days, after the rights represented by this Warrant shall have been so
exercised; and, unless this Warrant has expired, a new Warrant representing the
number of shares (except a remaining fractional share), if any, with respect to
which this Warrant shall not then have been exercised shall also be issued to
the holder hereof within such time. The person in whose name any certificate for
shares of Common Stock is issued upon exercise of this Warrant shall for all
purposes be treated as having become the holder of record of such shares on the
date on which the Warrant was surrendered, together with a properly completed
Notice of Exercise, and payment of the Warrant Exercise Price and any applicable
taxes was made, except that, if the date of such surrender and payment is a date
on which the stock transfer books of the Corporation are closed, such person
shall be treated as having become the holder of such shares at the close of
business on the next succeeding date on which the stock transfer books are open.
Section 2. ADJUSTMENT OF NUMBER OF SHARES. Upon each adjustment of the
Warrant Exercise Price as provided in Section 3, the holder of this Warrant
shall thereafter be entitled to purchase, at the Warrant Exercise Price
resulting from such adjustment and subject to the provisions of Section 1, the
number of shares (calculated to the nearest whole share) obtained by multiplying
the Warrant Exercise Price in effect immediately prior to such adjustment by the
number of shares purchasable pursuant hereto immediately prior to such
adjustment and dividing the product thereof by the Warrant Exercise Price
resulting from such adjustment.
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Section 3. ADJUSTMENT OF PRICE UPON STOCK SPLITS, STOCK DIVIDENDS AND
REORGANIZATIONS. The adjustments provided for in this Section 3 shall be made
for any events occurring on or after April 21, 1999.
(a) SUBDIVISION OR COMBINATION OF STOCK. In case the Corporation shall
at any time subdivide its outstanding shares of Common Stock into a greater
number of shares, the Warrant Exercise Price in effect immediately prior to such
subdivision shall be proportionately reduced, and conversely, in case the
outstanding shares of Common Stock of the Corporation shall be combined into a
smaller number of shares, the Warrant Exercise Price in effect immediately prior
to such combination shall be proportionately increased.
(b) STOCK DIVIDENDS. In case the Corporation shall declare a dividend
or make any other distribution upon any stock of the Corporation payable in
Common Stock, or rights to subscribe for Common Stock or any stock or securities
convertible or exchangeable for Common Stock, any Common Stock, issuable without
consideration in payment of such dividend or distribution shall be treated as
having been issued or sold without consideration, and the Warrant Exercise Price
shall be reduced as if the Corporation had subdivided its outstanding shares of
Common Stock into a greater number of shares, as provided in paragraph (a)
above.
(c) REORGANIZATION, RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE. If
any capital reorganization or reclassification of the capital stock of the
Corporation or any consolidation or merger of the Corporation with or into
another corporation, or the sale of all or substantially all of its assets to
another corporation shall be effected in such a way (including, without
limitation, by way of consolidation or merger) that holders of Common Stock
shall be entitled to receive stock, securities or assets with respect to or in
exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provisions
shall be made whereby each holder of Warrants shall thereafter have the right to
receive, upon the basis and upon the terms and conditions specified herein and
in lieu of the shares of Common Stock of the Corporation immediately theretofore
receivable upon the exercise of such Warrants, such shares of stock, securities
or assets as may be issued or payable with respect to or in exchange for a
number of outstanding shares of such Common Stock equal to the number of shares
of such stock immediately theretofore so receivable had such reorganization,
reclassification, consolidation, merger or sale not taken place, and in any such
case appropriate provision shall be made with respect to the rights and
interests of such holder to the end that the provisions hereof (including,
without limitation, provisions for adjustment of the Warrant Exercise Price)
shall thereafter be applicable, as nearly practicable, in relation to any shares
of stock, securities or assets thereafter deliverable upon the exercise of such
exercise rights. The Corporation will not effect any such consolidation or
merger, or any sale of all or substantially all of its assets and properties,
unless prior to the consummation thereof the successor corporation (if other
than the Corporation) resulting from such consolidation or merger or the
corporation purchasing such assets shall assume by written instrument, executed
and mailed or delivered to each holder of Warrants at the last address of such
holder appearing on the records of the Corporation, the obligation to deliver to
such holder such shares of stock, securities or assets as, in accordance with
the foregoing provisions, such holder may be entitled to receive.
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(d) NOTICE OF ADJUSTMENT. Upon any adjustment of the Warrant Exercise
Price, then and in each such case the Corporation shall give written notice
thereof, by first class mail postage prepaid, addressed to each holder of
Warrants at the address of such holder as shown on the records of the
Corporation, which notice shall state the Warrant Exercise Price resulting from
such adjustment, setting forth in reasonable detail the method of calculation
and the facts upon which such calculation is based.
(e) CERTAIN EVENTS. If any event occurs as to which in the opinion of
the Board of Directors of the Corporation the other provisions of this Section 3
are not strictly applicable or if strictly applicable would not fairly protect
the exercise rights of this Warrant, in accordance with the essential intent and
principles of such provisions to protect against dilution, then such Board of
Directors shall in good faith make an adjustment in the application of such
provisions, in accordance with such essential intent and principles, so as to
protect such exercise rights as aforesaid.
(f) STOCK TO BE RESERVED. The Corporation will at all times reserve and
keep available out of its authorized Common Stock or its treasury shares, solely
for the purpose of issue upon the exercise of this Warrant as herein provided,
such number of shares of Common Stock as shall then be issuable upon the
exercise of this Warrant. The Corporation covenants that all shares of Common
Stock which shall be so issued shall be duly and validly issued and fully paid
and nonassessable and free from all taxes, liens and charges with respect to the
issue thereof, and, without limiting the generality of the foregoing, the
Corporation covenants that it will from time to time take all such action as may
be requisite to assure that the par value per share of the Common Stock is at
all times equal to or less than the effective Warrant Exercise Price. The
Corporation will take all such action as may be necessary to assure that all
such shares of Common Stock may be so issued without violation of any applicable
law or regulation, or of any requirements of any national securities exchange
upon which the Common Stock of the Corporation may be listed; PROVIDED, HOWEVER,
that this sentence shall not obligate the Corporation to register such shares
under the Securities Act of 1933, as amended (the "Securities Act"), or any
applicable state securities laws or to take any action to enable the sale or
transfer of such shares to be made in accordance with Rule 144 under the
Securities Act.
Section 4. NOTICES OF RECORD DATES. In the event of
(1) any taking by the Corporation of a record of the holders of
any class of securities for the purpose of determining the
holders thereof who are entitled to receive any dividend or
other distribution (other than cash dividends out of earned
surplus), or any right to subscribe for, purchase or otherwise
acquire any shares of stock of any class or any other
securities or property, or to receive any other right, or
(2) any capital reorganization of the Corporation, any
reclassification or recapitalization of the capital stock of
the Corporation or any sale of all or substantially all the
assets of the Corporation to or consolidation or merger of the
Corporation with or into any other corporation, or
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(3) any voluntary or involuntary dissolution, liquidation or
winding-up of the Corporation,
then and in each such event the Corporation will give notice to the holder of
this Warrant specifying (i) the date on which any such 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, and (ii) the date on which
any such reorganization, reclassification, recapitalization, sale,
consolidation, merger, 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 will be entitled to exchange their shares of Common Stock for securities
or other property deliverable upon such reorganization, reclassification,
recapitalization, sale, consolidation, merger, dissolution, liquidation or
winding-up. Such notice shall be given at least ten (10) days and not more than
ninety (90) days prior to the date therein specified.
Section 5. NO STOCKHOLDER RIGHTS. This Warrant shall not entitle the
holder hereof to any voting rights or other rights as a stockholder of the
Corporation.
Section 6. INVESTMENT REPRESENTATION AND LEGEND. The holder, by
acceptance of the Warrant, represents and warrants to the Corporation that it is
acquiring the Warrant and the shares of Common Stock (or other securities)
issuable upon the exercise hereof for investment purposes only and not with a
view towards the resale or other distribution thereof and agrees that the
Corporation may affix upon this Warrant the following legend:
"NEITHER THIS WARRANT NOR THE SHARES ISSUABLE UPON THE EXERCISE OF THIS
WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THEY HAVE BEEN REGISTERED
UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS OR UNLESS AN
EXEMPTION FROM REGISTRATION IS AVAILABLE."
The holder, by acceptance of this Warrant, further agrees that the
Corporation may affix the following legend to certificates for shares of Common
Stock issued upon exercise of this Warrant:
"THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE
SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED
OF UNLESS THEY HAVE BEEN REGISTERED UNDER THE ACT AND APPLICABLE STATE
SECURITIES LAWS OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE."
Section 7. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this
Warrant is lost, stolen, mutilated or destroyed, the Corporation may, upon
delivery of an indemnity agreement reasonably satisfactory to the Corporation
and such other terms as the Corporation may otherwise in its discretion
reasonably impose (which shall, in the case of a
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mutilated Warrant, include the surrender thereof), issue a new Warrant of like
denomination and tenor as the Warrant so lost, stolen, mutilated or destroyed.
Any such new Warrant shall constitute an original contractual obligation of the
Corporation, whether or not the allegedly lost, stolen, mutilated or destroyed
Warrant shall be at any time enforceable by anyone.
Section 8. NOTICES. All notices, requests, and other communications
required or permitted to be given or delivered hereunder shall be in writing,
and shall be delivered, or shall be sent by certified or registered mail,
postage prepaid and addressed,
(i) if to the holder, to
Xxxx Xxxxxxxx Xxxxxxx
00 Xxxxx Xxxxx Xxxxxx, 00X0
Xxxxxxxxxxx, Xxxxxxxxx 00000
or at such other address as shall have been furnished to the Corporation by
notice from such holder, and
(ii) if to the Corporation, to it at
HealthGate Data Corp.
00 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Chief Financial Officer
or at such other address as shall have been specified to the holder by notice
from the Corporation.
IN WITNESS WHEREOF, HEALTHGATE DATA CORP. has executed this Warrant as
of the day and year first above written.
HEALTHGATE DATA CORP.
By: /S/ XXXXXXX X. XXXXX
-------------------------------
Xxxxxxx X. Xxxxx
President and Chief Executive
Officer
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