_________ WARRANTS
THESE WARRANTS AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THESE
WARRANTS (THE "WARRANT SHARES") HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 (THE "SECURITIES ACT") OR UNDER APPLICABLE STATE SECURITIES LAWS.
THE WARRANT SHARES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS
REGISTERED UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AVAILABLE EXEMPTIONS FROM SUCH REGISTRATION, PROVIDED THAT THE
SELLER DELIVERS TO THE COMPANY AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
CONFIRMING THE AVAILABILITY OF SUCH EXEMPTION.
_________ ___, 1996
ICON CMT CORP.
Warrants for the Purchase of Shares of Common Stock
FOR VALUE RECEIVED, ICon CMT Corp., a Delaware corporation
(the "Company"), hereby certifies that BEAR, XXXXXXX & CO. INC., or its
registered assigns (the "Holder"), is entitled, subject to the provisions
contained herein, to purchase from the Company _________ fully paid and
non-assessable shares of Common Stock (as defined below), subject to adjustment
as provided herein, at an exercise price per share of Common Stock of $0.01 (the
"Exercise Price").
The term "Common Stock" means the Common Stock, par value $.01
per share, of the Company as constituted on the date hereof. The number of
shares of Common Stock to be received upon the exercise of these Warrants may be
adjusted from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time to time, are
hereinafter referred to as "Warrant Stock." The term "Other Securities" means
any other securities that may be issued by the Company in addition to, or in
substitution for, the Warrant Stock.
The term "Non-Surviving Combination" means any merger,
consolidation or other business combination by the Company with one or more
Persons (other than the Company or a wholly-owned subsidiary of the Company) in
which the other Person is the survivor, or any merger, consolidation or other
business combination by the Company with one or more Persons (other than the
Company or a wholly-owned subsidiary of the Company) in which the Company is the
survivor but as a result of which the Company is not required to file reports
with respect to its Common Stock with the Securities and Exchange Commission
(the "Commission") pursuant to Section 13 of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), or a sale of all or substantially all of
the assets of the Company to one or more such other Persons, and with respect to
which cash or non-cash consideration is distributed to holders of Common Stock.
The term "Person" means a corporation, a limited liability
company, an association, a partnership, an organization, a business, an
individual, a government or political subdivision thereof or a governmental
agency.
The term "Registration Statement" means any registration
statement of the Company which covers any of the Common Stock, including the
prospectus, amendments and supplements to such Registration Statement, including
post-effective amendments, all exhibits and all material incorporated by
reference in such Registration Statement.
The term "Affiliate" means any Person (and such Person's
spouse, parents and grandparents and their spouses, collateral and lineal
descendants and any other Person related to such Person by affinity or
consanguinity) (a) who is a director or officer of the Company or any of its
Subsidiaries, or (b) directly or indirectly controlling or controlled by or
under common control with the Company or any Subsidiary, including (without
limitation) any Person beneficially owning or holding 5% or more of any class of
voting securities of the Company or any Subsidiary or any other corporation of
which the Company or any Subsidiary owns or holds 5% or more of any class of
voting securities, provided that, for purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.
2
References herein to the "Company" are to (i) ICon CMT Corp.
and any successor thereto, (ii) any successor corporation resulting from the
merger or consolidation of ICon CMT Corp., or any successor thereto, with
another corporation or (iii) any corporation to which ICon CMT Corp., or any
successor thereto, has transferred its property or assets as an entirety or
substantially as an entirety.
Upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of these
Warrants, and (in the case of loss, theft or destruction) of reasonably
satisfactory indemnification, and upon surrender and cancellation of these
Warrants, if mutilated, the Company shall execute and deliver new Warrants of
like tenor and date. Any such new Warrants, upon execution and delivery, shall
constitute an additional contractual obligation on the part of the Company,
whether or not these Warrants so lost, stolen, destroyed or mutilated shall be
at any time enforceable by anyone.
The Holder agrees with the Company that these Warrants are
issued, and all the rights hereunder shall be held subject to, all of the
conditions, limitations and provisions set forth herein, including the
following:
1. Exercise of Warrants. These Warrants may be exercised, in
whole or in part, at any time, after the first anniversary of the date of the
closing (the "Closing") of the transactions contemplated by the Subscription
Agreement dated March 15, 1996 between the Company and each of the purchasers
listed on the signature pages thereto, but prior to the fifth anniversary of the
date of the Closing by presentation and surrender of these Warrants to the
Company at its principal office (which on the date hereof is 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000), with the Warrant Exercise Form attached
hereto duly executed and accompanied by payment (either in cash or by certified
or official bank check or checks, payable to the order of the Company) of the
Exercise Price for the number of shares specified in such form. If these
Warrants are exercised in part only, the Company shall, upon surrender of these
Warrants for cancellation, execute and deliver new Warrants evidencing the
rights of the Holder thereof to purchase the balance of Warrant Stock (and Other
Securities) purchasable hereunder. Upon receipt by the Company of these
Warrants, together with the Exercise Price, at its office, or by the Company's
stock transfer agent at its office, in proper form for exercise, the Holder
shall be deemed to be the holder of record of the Warrant Stock (and Other
Securities) issuable upon such exercise, notwithstanding that the transfer books
of the Company shall then be closed or that certificates representing such
Warrant Stock (or Other Securities) shall not then be actually
3
delivered to the Holder. The Company shall pay any and all documentary stamp or
similar issue or transfer taxes payable in respect of the issue or delivery of
Warrant Stock (and Other Securities) upon exercise of these Warrants.
2. Reservation of Shares and Other Securities. The Company
will at all times reserve for issuance and delivery upon exercise of these
Warrants all shares of Warrant Stock and other shares of capital stock of the
Company (and Other Securities) from time to time receivable upon exercise of
these Warrants. All such shares (and Other Securities) shall be duly authorized
and, when issued upon such exercise, shall be validly issued, fully paid and
non-assessable and free and clear of all preemptive rights.
3. Fractional Shares. No fractional shares or scrip
representing fractional shares shall be issuable upon the exercise of these
Warrants, but the Company shall pay the Holder an amount in cash equal to the
fair market value of such fractional share in lieu of each fraction of a share
otherwise issuable upon any exercise of these Warrants, as determined by the
Board of Directors of the Company in its reasonable discretion.
4. Exchange of Warrants. These Warrants are exchangeable,
without expense, at the option of the Holder, upon presentation and surrender
hereof to the Company or at the office of its stock transfer agent, if any, for
other Warrants of different denominations, entitling the Holder hereof to
purchase in the aggregate the same number of shares of Warrant Stock (and Other
Securities) purchasable hereunder.
5. Registration Rights of Holders.
5.1 Incidental Registration. If at any time during the
five-year period commencing on the first anniversary of the date hereof, the
Company shall file a registration statement for the registration of Common Stock
under the Securities Act with the Commission (other than a registration
statement on Form S-4 or S-8 or any successor form), the Company shall give at
least 30 calendar days prior written notice to the Holders. The Company shall
not request that the Commission declare such registration statement effective
earlier than 30 calendar days after the giving of such notice and shall use its
best efforts to delay effective ness of such registration statement until at
least 30 calendar days after the giving of such notice. Subject to the
succeeding paragraph, each Holder shall have the right to request that the
Company include in such offering the Warrant Stock (and Other
4
Securities), and the Company shall enter into an underwriting agreement with one
or more underwriters which shall provide that the underwriters shall purchase
the Warrants from requesting Holders or their Warrant Stock (or Other
Securities) after exercise of the Warrants at the price paid by the underwriters
for Common Stock (or if securities convertible into or exchangeable or
exercisable for, or rights to purchase, Common Stock are being issued, then the
conversion, exchange, exercise or purchase price for the Common Stock provided
for by such securities less the conversion, exchange or exercise premium on the
date of such offering) sold by the Company and/or selling stockholders, as each
requesting Holder may elect.
The Company shall use its best efforts to have such requesting
Warrant Stock (and Other Securities) (to the extent requested by the Holders
within 20 calendar days after delivery of the Company's written notice) included
in such offering except to the extent the underwriters (or any managing
underwriter), in their (or its) sole judgement, shall advise the Company in
writing that, in their opinion, inclusion of such number of shares of Warrant
Stock (or Other Securities) will materially adversely affect the price or
distribution of any securities to be offered solely for the account of the
Company. The Company shall promptly furnish each Holder requesting registration
with a copy of such written advice. If (x) the prospective offering is not
entirely a secondary offering, (y) the prospective offering is to be
underwritten, and (z) in the event that the number of shares of Warrant Stock
(or Other Securities) which Holders have requested to be included and the shares
of Common Stock and securities exercisable or exchangeable for, or convertible
into Common Stock which selling securityholders have requested to be included in
such offering exceeds the total number of shares of Warrant Stock (or Other
Securities) and such securities of selling securityholders which, pursuant to
the advice of the underwriters (or any managing underwriter), in their (or its)
sole judgement, may be distributed without materially adversely affecting the
price or distribution of any securities to be sold solely for the Company's
account (such shares of Warrant Stock (or Other Securities) and the shares of
Common Stock and the shares of Common Stock underlying the securities which are
exercisable or exchangeable for, or convertible into Common Stock of such
selling securityholders which may be included without materially adversely
affecting the price or distribution of securities to be sold solely for the
Company's account being the "Includible Securities"), then the aggregate number
of shares of Warrant Stock (or Other Securities) entitled to be included in such
registration statement for the prospective offering shall be the product of (1)
a fraction, the numerator of which is the number of shares of Warrant Stock (or
Other Securities) which Holders have
5
requested to be included and the denominator of which is the total number of
securities, including such Warrant Stock (or Other Securities), the holders of
which have requested to be included in such offering (such fraction is hereafter
referred to as the "Holders' Percentage") and (2) the total number of Includible
Securities, and the Company may include in such registration statement
Includible Securities other than Warrant Stock (and Other Securities) such that
the number of such other Includible Securities does not exceed the difference
between the total number of Includible Securities and the aforementioned
aggregate number of shares of Warrant Stock (and Other Securities) which are
entitled to be included in such registration statement. The Company shall
allocate the number of shares of Warrant Stock entitled to be included in such
Registration Statement among each requesting Holder in proportion to the
respective numbers of shares of Warrant Stock (or Other Securities) that such
Holder requested be registered. If (x) the prospective offering is entirely a
secondary offering and (y) the prospective offering is to be underwritten, then
the Holders shall have the right to include a number of shares of Warrant Stock
(and Other Securities) which is equal to the product of (1) the Holders'
Percentage and (2) the total number of securities to be offered. The number of
shares of Warrant Stock (or Other Securities) included in such registration
statement shall be allocated pro rata among Holders as set forth in the
preceding sentence.
If the prospective offering is not to be underwritten, then
the Warrant Stock (and Other Securities) of all Holders requesting inclusion in
such prospective offering, or such greater amount of the Warrant Stock (and
Other Securities) as the Company may choose, shall be included in the
registration statement for the prospective offering. The Holders of securities
included in any registration statement pursuant to this subsection 5.1 are
referred to herein as "Selling Holders".
Notwithstanding the foregoing, if, at any time after giving
written notice of its intention to register any securities and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall reasonably determine for any good corporate
reason either not to register, to discontinue registration or to delay
registration of such securities, the Company may, at its election, give written
notice of such determination to each Selling Holder and, thereupon, (i) in the
case of a determination not to register or to discontinue registration, shall be
relieved of its obligation to register any Includible Securities in connection
with such registration and (ii) in the case of a determination to delay
registering, shall be permitted to delay registering any
6
Includible Securities for the same period as the delay in registering such other
securities. The Company shall pay the reasonable expenses of such registration.
The Holders shall be entitled to have their shares included in
an unlimited number of registrations pursuant to this Subsection 5.1.
5.2 Duties and Rights Upon a Non-Surviving Combination. In the
case of any proposed merger, consolidation or other business combination by the
Company with, or sale of all or substantially all of the assets of the Company
to, one or more other Persons (the "Acquirer") which, if consummated, would
constitute a Non-Surviving Combination, the Company shall give at least 30
calendar days prior written notice thereof to the Holders. In the case of (i) a
Non-Surviving Combination by the Company in which cash is distributed to holders
of Common Stock, as a condition to the consummation of such merger,
consolidation or other business combination with the Company, the Acquirer shall
be obligated to purchase all of each Holder's Warrants (and Other Securities)
which shall not have been exercised prior to the consummation of such
Non-Surviving Combination for a cash payment equal to the cash amount that
would have been distributable on account of the Warrant Stock (and Other
Securities) if such Warrants had been exercised in full immediately prior to
such Non-Surviving Combination; and (ii) a Non-Surviving Combination by the
Company in which any non-cash consideration is distributed to holders of Common
Stock, as a condition to the consummation of such merger, consolidation or other
business combination with the Company, the Acquirer shall execute an instrument
pursuant to which it shall be obligated (a) to distribute to each Holder in
respect of such Holder's Warrants (and Other Securities) which shall not have
been exercised prior to the consummation of such Non-Surviving Combination,
upon the exercise of such Warrants, the number of shares of stock or other
securities or other property (including any cash) of the Acquirer that would
have been distributable on account of the Warrant Stock (and Other Securities)
if the Holder's Warrants had been exercised in full immediately prior to such
Non-Surviving Combination, and (b) to adjust the number and kind of shares of
stock or other securities deliverable upon exercise of the Warrants upon the
occurrence of certain events with respect to the Acquirer in the manner set
forth in the anti-dilution provisions contained in Section 7 hereof; provided
that in the event holders of Common Stock are entitled to exercise rights of
election as to the kind and amount of consideration receivable upon such
Non-Surviving Combination, holders of Warrants shall be entitled to exercise the
same rights of election with respect to the kind and amount of consideration
receivable upon such
7
Non-Surviving Combination (and Company shall give at least 10 calendar days
prior written notice of any such rights of election).
In the event of any Non-Surviving Combination under (i) above,
the Acquirer shall transfer the cash owing to Holders hereunder to the
respective Holders by mailing by first-class mail a check to each such Holder at
such Xxxxxx's address shown in the Company's records, or as it may be otherwise
directed in writing by each Holder, upon surrender of such Xxxxxx's Warrants.
In the event of any Non-Surviving Combination under (ii)
above, if the opinion referred to in the following paragraph states that the
non-cash consideration may be distributed and immediately resold without
violation of the Securities Act or otherwise resulting in a violation of law,
then the Warrants shall be immediately exercisable upon the receipt by the
Company of such opinion and the closing of the transaction constituting such
Non-Surviving Combination and if such opinion states that registration under the
Securities Act or other actions are required prior to distribution or resale of
the non-cash consideration, then the Warrants shall be immediately exercisable
upon the effectiveness of such registration statement or the taking of such
other actions. In either case, the Company will promptly give notice to the
Holders of the date the Warrants become exercisable.
In the event of any Non-Surviving Combination in which
non-cash consideration is received or to be received by Holders, the Acquirer
shall obtain the written opinion of independent counsel as to whether or not (x)
any securities constituting such non-cash consideration may, in the opinion of
such counsel, be delivered to the Holders upon exercise and resold, in whole or
in part, immediately after the closing of the Non-Surviving Combination by a
holder without the registration of such securities under the Securities Act, and
(y) any property other than cash or securities may be delivered to the Holders
upon exercise and resold, in whole or in part, immediately after the closing of
the Non-Surviving Combination by a holder without violation of law. Such opinion
shall be provided to the Holders, and at least 30 calendar days prior written
notice given to the Holders. In the event such counsel shall be of the opinion
that such registration is required or a violation of law would occur, the
Acquirer shall be obligated either (A) to register such securities with respect
to the Warrant Stock (and Other Securities) and maintain the effectiveness of
such registration statement for a period of one year and promptly give notice
thereof to all Holders of such securities who received such securities upon
exercise of Warrants and take such other ac-
8
tions with respect to such other property so as to make its distribution or
resale not a violation of law, or (B) to pay Holders in cash in accordance with
the provisions of clause (i) of the first paragraph of this Subsection 5.2, the
current market value of such securities as of the date of consummation of such
Non-Surviving Combination.
5.3 General Provisions Regarding Registration.
(a) Compliance with Federal and State Laws. The Company
shall effect the registration or qualification of the Warrant Stock (and Other
Securities) registered pursuant to Section 5 and give such notifications to or
obtain approval of any governmental authority under any federal or state law
(including, without limitation, state securities laws or Blue Sky laws), or
effect listing with any securities exchange on which the Common Stock is or is
to be listed as may be necessary to permit the sale of Warrant Stock (and Other
Securities) through underwriters, or, if such Warrant Stock (and Other
Securities) is not to be sold pursuant to an underwritten offering, as the
Holders may reasonably request.
(b) Registration Expenses; Withdrawal Rights. Any
registration, qualification, notification, approval or listing made pursuant to
Section 5 shall be at the sole expense of the Company, provided that the Company
shall not be responsible for underwriters' or brokers' discounts and commissions
for any Selling Holder or for transfer taxes, and further provided that the
Company shall only be responsible for the reasonable fees and expenses of one
counsel retained by the Selling Holders and approved by the Company, which
approval shall not be unreasonably withheld, in connection with each
Registration Statement. The Company will withdraw from registration any Warrant
Stock (and Other Securities) on request of a Holder, at the expense of the
Company.
(c) Amendments and Supplements. The Company shall, from
time to time, amend or supplement the prospectus and Registration Statement used
in connection with any registration pursuant to this Warrant to the extent
necessary to comply with applicable law (including, without limitation, to
reflect additional information relating to the plan of distribution), and shall
immediately advise the Selling Holders if any such prospectus or Registration
Statement does not so comply and if any stop order or similar order is issued or
threatened or any request for amendment or supplement is received from any
regulatory agency. The Company shall make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest
9
possible moment. The Company shall comply with all other applicable laws in
connection with any offering of Warrant Stock (and Other Securities) and will
promptly make available an earnings statement in accordance with Section 11(a)
of the Securities Act, and the regulations promulgated thereunder.
(d) Underwriting and Other Agreements. The Company shall
enter into and execute all agreements and deliver all other instruments
(including opinions of counsel and comfort letters) customary and appropriate
in connection with public offerings (including underwriting agreements, if such
offering is to be underwritten, with indemnification and contribution provisions
in customary form), and the Company and its Affiliates shall agree to refrain
from selling any Common Stock for such period as may be reasonably requested by
the underwriters, if such offering is to be underwritten, and shall cause its
officers and directors to, cooperate with any underwriters, if such offering is
to be underwritten, to facilitate sales of the Warrant Stock (and Other
Securities) to the same extent as if they were being offered by the Company. The
Company shall furnish each Selling Holder such number of copies of Registration
Statements and prospectuses, and any amendments and supplements thereto, as such
Holder may reasonably request and take all such other steps as are advisable to
facilitate the disposition of such Warrant Stock (and Other Securities). The
Selling Holders shall provide to the Company such information with respect to
themselves as may be reasonably required for inclusion in the Registration
Statement pursuant to the Securities Act and the rules and regulations
thereunder, shall cooperate with the Company in the preparation of, and during
the effectiveness of, the Registration Statement, and shall enter into and
execute all agreements and deliver all other instruments (including an
underwriting agreement, if such offering is to be underwritten, with customary
indemnification and contribution provisions and including any undertaking to
pay for costs payable by Selling Holders) that are customary and appropriate for
selling stockholders to execute in connection with secondary public offerings,
provided that any underwriters' or brokers' discounts, commissions or other fees
and expenses payable (on a per share basis) by such Selling Holders shall not be
in excess of such underwriters' or brokers' discounts, commissions or other fees
and expenses payable (on a per share basis) by the Company. The Selling Holders
shall inform the Company upon request as to the manner in which they have
effected sales of Warrant Stock (and Other Securities) under the Registration
Statement.
10
(e) Indemnification and Contribution.
(i) Indemnification by the Company. In connection
with any registration of Warrant Stock (and Other Securities) pursuant
to the provisions of Section 5, the Company agrees to indemnify and
hold harmless each Person who participates as an underwriter
("Underwriter"), each Selling Holder and each director and officer of
any Selling Holder or Underwriter and each person, if any, who controls
any Selling Holder or Underwriter within the meaning of Section 15 of
the Securities Act as follows:
(I) against any and all losses, liabilities, claims,
damages and expenses whatsoever arising out of any untrue statement or
alleged untrue statement of a material fact contained in any
Registration Statement (or any amendment thereto) pursuant to which any
Warrant Stock (and Other Securities) were or are to be registered under
the Securities Act, including all documents incorporated therein by
reference, or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to make the statements
therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in any
preliminary prospectus or the prospectus (or any amendment or
supplement thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(II) against any and all losses, liabilities, claims,
damages and expenses whatsoever to the extent of the aggregate amount
paid in settlement of any litigation, or investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, if such settlement is
effected with the written consent of the Company, which consent shall
not be unreasonably withheld; and
(III) against any and all expenses whatsoever
(including, without limitation, reasonable fees and disbursements of
counsel chosen by the Indemnified Party (as defined herein) incurred by
such Indemnified Party in any action or proceeding between the Company
and the Indemnified Party or between the Indemnified Party and any
third party or other-
11
wise) reasonably incurred in investigating, preparing or defending
against any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under subparagraph (I) or (II) above;
provided, however, that this indemnity agreement does not apply to any loss,
liability, claim, damage or expense suffered by any Selling Holder or any
Underwriter to the extent arising out of any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with written information furnished to the Company by such Selling Holder or such
Underwriter, respectively, expressly for use in any Registration Statement (or
any amendment thereto) or any preliminary prospectus or the prospectus (or any
amendment or supplement thereto). The foregoing indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of any
Selling Holder or any Underwriter, and shall survive the transfer of such
securities by such Selling Holder.
(ii) Indemnification by Xxxxxxx Xxxxxx. Each Selling
Holder whose Warrant Stock (and Other Securities) are sold under any
Registration Statement pursuant to Section 5 severally agrees to
indemnify and hold harmless the Company, each Underwriter and the other
Selling Holders, and each of their respective directors and officers
(including each officer of the Company who signed the Registration
Statement), and each Person, if any, who controls the Company, any
Underwriter or any other Selling Holder within the meaning of Section
15 of the Securities Act (each, an "Indemnified Party"), against any
and all losses, liabilities, claims, damages and expenses described in
the indemnity contained in Subsection 5.3(e)(i) hereof, but only with
respect to untrue statements or omissions, or alleged untrue statements
or omissions, made in any Registration Statement (or any amendment
thereto) or any preliminary prospectus or the prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity
with written information furnished to the Company, any Underwriter or
the other Selling Holders by such Selling Holder expressly for use in
the Registration Statement (or any amendment thereto) or such
preliminary prospectus or the prospectus (or any amendment or
supplement thereto). The liability of each Selling Holder under this
paragraph shall be limited to the net proceeds received by each such
Selling Holder from the sale of its Warrant
12
Stock (and Other Securities) under the Registration Statement
registering such Warrant Stock (and Other Securities).
(iii) Conduct of Indemnification Proceedings. Each
Indemnified Party shall give prompt notice to each indemnifying party
(the "Indemnifying Party") of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so
notify an Indemnifying Party shall not relieve it from any liability
which it may have otherwise than pursuant to this indemnity agreement
or if the Indemnifying Party is not materially prejudiced in its
defense thereby. An Indemnifying Party may, at its own expense,
participate in and direct the defense of such action. In no event
shall the Indemnifying Parties be liable for the fees and expenses of
more than one counsel for all Indemnified Parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or
circumstances.
(iv) Contribution. In order to provide for just and
equitable contribution in circumstances in which the indemnity
agreement provided for in this Subsection 5.3(e) is for any reason held
to be unenforceable although applicable in accordance with its terms,
the Company, the Selling Holders and the Underwriter, as among
themselves, shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by such
indemnity agreement incurred by the Company, the Selling Holders and
the Underwriter in such proportions that the Underwriter is
responsible only for that portion represented by the percentage that
the underwriting discount appearing on the cover page of the prospectus
bears to the initial public offering price appearing thereon and the
Company is responsible for the balance (except that each of the Selling
Holders shall be responsible for the aggregate losses, liabilities,
claims, damages and expenses arising with respect to untrue statements
or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or any preliminary
prospectus or the prospectus (or any amendment or supplement thereto)
in reliance upon and in conformity with written information furnished
to the Company, any Underwriter or the other Selling Holders by such
Selling Holder expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the prospectus
(or any amendment or supplement thereto)); provided, however, that no
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribu-
13
xxxx from any Person who was not guilty of such fraudulent
misrepresentation. For purposes of this Subsection 5.3(e), each
Person, if any, who controls an Underwriter or Selling Holder within
the meaning of Section 15 of the Securities Act shall have the same
rights to contribution as such Underwriter or Selling Holder, and each
director of the Company, each officer of the Company who signed the
Registration Statement, and each Person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act shall
have the same rights to contribution as the Company.
6. ADJUSTMENTS
6.1 Adjustments. The number of shares of Common Stock issuable
upon exercise of each Warrant shall be subject to adjustment from time to time
as follows:
(1) Stock Dividends; Stock Splits; Reverse Stock Splits;
Reclassification. In case at any time or from time to time the Company shall
(i) take a record of the holders of its Common Stock for the purpose of
entitling them to receive a dividend payable in, or other distribution of, its
Common Stock, (ii) subdivide its outstanding shares of any class or series of
Common Stock into a larger number of any class or series of shares of Common
Stock, or (iii) combine its outstanding shares of any class or series of Common
Stock into a smaller number of shares of any class or series of Common Stock, or
(iv) increase or decrease the number of shares of its capital stock in a
reclassification of the Common Stock (including any such reclassification in
connection with a merger, consolidation or other business combination in which
the Company is the continuing corporation), then the number of shares of Common
Stock issuable upon exercise of each Warrant immediately prior to the record
date for such dividend or the effective date of such subdivision or combination
shall be adjusted so that the Holder of each Warrant shall thereafter be
entitled to receive the kind and number of shares of Warrant Stock or other
securities of the Company that such Xxxxxx would have owned or have been
entitled to receive after the happening of any of the events described above,
had such Warrant been exercised immediately prior to the happening of such event
or any record date with respect thereto. An adjustment made pursuant to this
Section 6.1(1) shall become effective immediately after the effective date of
such event.
(2) Adjustments on Consolidation and Merger. Except as
provided herein, if the Company shall consolidate or merge with another
corporation, and
14
the Company is the surviving corporation, then the Holders of the Warrants shall
have the right to receive upon exercise of the Warrants, such number of shares
of Common Stock and other property which such Holder would have been entitled to
receive upon or as a result of such consolidation or merger had such Warrant
been exercisable and exercised immediately prior to such event.
(3) Issuance of Common Stock at Less Than Fair Market Value.
In case the Company shall sell and issue shares of any class or series of Common
Stock, or rights, options, warrants or convertible or exchangeable securities
containing the right to subscribe for or purchase shares of any class or series
of Common Stock (excluding (i) shares, rights, options, warrants or convertible
or exchangeable securities issued in any of the transactions described in
Section 6.1(1) or (2) above, (ii) Common Stock or securities convertible into,
or exchangeable for, Common Stock or rights to acquire Common Stock or such
securities, issued or to be issued or granted to directors, officers or
employees of the Company in an amount not to cumulatively exceed 15% of the
Common Stock outstanding on the date hereof on a fully diluted basis (including
such shares and assuming the exercise of all Warrants) at any time during which
Warrants are outstanding, and (iii) the Warrants and any shares issued on
exercise thereof, but including shares, rights, options, warrants or convertible
or exchangeable securities issued as consideration in any merger, consolidation
or other business combination), at a price per share of Common Stock (determined
in the case of such rights, options, warrants or convertible or exchangeable
securities, by dividing (X) the total amount receivable by the Company in
consideration of the sale and issuance of such rights, options, warrants or
convertible or exchangeable securities, plus the total consideration payable to
the Company upon exercise, conversion or exchange thereof, by (Y) the total
number of shares of Common Stock covered by such rights, options, warrants or
convertible or exchangeable securities) that is lower than the then current
market value per share of Common Stock in effect immediately prior to such sale
and issuance, then the number of shares of Common Stock issuable upon the
exercise of each Warrant shall be adjusted and shall be that number determined
by multiplying the number of shares of Common Stock issuable upon exercise
immediately prior to such adjustment by a fraction, the numerator of which is
the total number of shares of Common Stock outstanding immediately after such
sale or issuance and the denominator of which is an amount equal to the sum of
(A) the number of shares of Common Stock outstanding immediately prior to such
sale and issuance plus (B) the number of shares of Common Stock which the
aggregate consideration received (determined as provided below) for such sale or
issuance would purchase at current market value per share. Such adjustment shall
be made
15
successively whenever such an issuance is made. For the purposes of such
adjustments, the shares of Common Stock which the holder of any such rights,
options, warrants or convertible or exchangeable securities shall be entitled to
subscribe for or purchase shall be deemed to be issued and outstanding as of the
date of the sale and issuance of the rights, warrants or convertible or
exchangeable securities and the consideration received by the Company therefor
shall be deemed to be the consideration received by the Company for such rights,
options, warrants or convertible or exchangeable securities, plus the
consideration or premiums stated in such rights, options, warrants or
convertible or exchangeable securities to be paid for the shares of Common Stock
covered thereby. In case the Company shall sell and issue shares of Common Stock
or rights, options, warrants or convertible or exchangeable securities
containing the right to subscribe for or purchase shares of Common Stock for a
consideration consisting, in whole or in part, of property other than cash or
its equivalent, then in determining the "price per share of Common Stock" and
the "consideration received by the Company" for purposes of the first sentence
of this Subsection 6.1(4), the Board of Directors of the Company shall
determine, in good faith, the fair value of said property.
(5) Expiration of Rights, Options and Conversion Privileges.
Upon the expiration of any rights, options, warrants or conversion or exchange
privileges, the issuance of which caused an adjustment pursuant to Section
6.1(4) hereof, if any thereof shall not have been exercised, the number of
shares of Common Stock issuable upon the exercise of each Warrant shall, upon
such expiration, be readjusted and shall thereafter, upon any future exercise,
be such as they would have been had they been originally adjusted (or had the
original adjustment not been required, as the case may be) as if (A) the only
shares of Common Stock so issued were the shares of Common Stock, if any,
actually issued or sold upon the exercise of such rights, options, warrants or
conversion or exchange rights and (B) such shares of Common Stock, if any, were
issued or sold for the consideration actually received by the Company upon such
exercise plus the consideration, if any, actually received by the Company for
issuance, sale or grant of all such rights, options, warrants or conversion or
exchange rights whether or not exercised; provided, further, that no such
readjustment shall have the effect of decreasing the number of shares issuable
upon exercise of each Warrant by a number in excess of the number of the
adjustment initially made with respect to the issuance, sale or grant of such
rights, options, warrants or conversion or exchange rights.
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(6) De Minimis Adjustments. The adjustments required by the
preceding Subsections of this Section 6.1 shall be made whenever and as often as
any specified event requiring an adjustment shall occur, except that no
adjustment of the number of shares of Common Stock issuable upon exercise of
Warrants that would otherwise be required shall be made (except in the case of a
subdivision or combination of shares of Common Stock, as provided for in Section
6.1(1)) unless and until such adjustment either by itself or with other
adjustments not previously made increases or decreases by at least 5% of the
number of shares of Common Stock issuable upon exercise of Warrants immediately
prior to the making of such adjustment. Any adjustment representing a change of
less than such minimum amount (except as aforesaid) shall be carried forward and
made as soon as such adjustment, together with other adjustments required by
this Section and not previously made, would result in a minimum adjustment or,
if sooner, upon exercise of the Warrant. For the purpose of any adjustment, any
specified event shall be deemed to have occurred at the close of business on the
date of its occurrence. All calculations shall be made to the nearest
one-thousandth of a share.
(7) Fractional Interests. In computing adjustments under this
Section 6, fractional interests in Common Stock shall be taken into account to
the nearest one-thousandth of a share.
(8) When Adjustment Not Required. If the Company shall take a
record of the holders of its Common Stock for the purpose of entitling them to
receive a dividend or distribution or subscription or purchase rights and
shall, thereafter and before the distribution to stockholders thereof, legally
abandon its plan to pay or deliver such dividend, distribution, subscription or
purchase rights, then thereafter no adjustment shall be required by reason of
the taking of such record and any such adjustment previously made in respect
thereof shall be rescinded and annulled.
(9) Other Actions. In case at any time or from time to time
the Company shall take any action in respect of its Common Stock which give rise
to anti-dilution adjustments under any option, warrant, convertible security or
other right to acquire Common Stock, whether outstanding on the date of issuance
of this Warrant or hereafter issued and together with any agreements related
thereto (but excluding anti-dilution or other adjustment rights with respect to
the Warrants), then the Company shall promptly make proportional, equitable and
corresponding adjustments in the number of shares of Common Stock issuable upon
exercise of each Warrant to protect the holder thereof against dilution as a
result of such event.
17
6.2 Notice of Adjustment. Whenever the number of shares of
Common Stock or other stock or property issuable upon the exercise of each
Warrant is adjusted, as herein provided, the Company shall promptly mail to each
Holder notice in accordance with Section 8 of such adjustment or adjustments and
shall deliver to each Holder a certificate of a firm of certified 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 shares
of Common Stock or other stock or property issuable upon the exercise of each
Warrant 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.
6.3 Notice of Certain Corporate Action. In case the Company
shall propose (a) to pay any dividend payable in securities of any class to the
holders of the Common Stock or to make any other distribution to the holders of
the Common Stock, or (b) to offer the holders of the Common Stock rights to
subscribe for or to purchase any securities convertible into shares of Common
Stock or shares of stock of any class or any other securities, rights or
options, or (c) to issue any Common Stock, securities convertible into shares of
Common Stock, options, rights or exchangeable securities to Persons other than
(i) the holders of the Common Stock and (ii) any Holders of Warrants upon the
exercise of such Warrants (other than options, warrants, convertible securities
or other rights excluded from the scope of Section 6.1(3)), or (d) to effect any
capital reorganization, consolidation or merger, then, in each such case, the
Company shall give the Holders of the Warrants a notice in accordance with
Section 8 of such proposed action, which shall specify the date on which a
record is to be taken for the purposes of such dividend, distribution or rights,
or the date such issuance is to take place and the date of participation therein
by the holders of Common Stock, if any, such date is to be fixed, and shall be
reasonably necessary to indicate the effect of such action on the Common Stock
and the number and kind of any other shares of stock and other property, if any,
after giving effect to any adjustment which will be required as a result of such
action. Such notice shall be so given in the case of any action covered by
clause (a) or (b) above at least 10 calendar days prior to the record date for
determining holders of the Common Stock for purposes of such action and, in the
case of any other such action, at least 20 calendar days prior to the date of
the taking of such proposed action or the date of participation therein by the
holders of Common Stock, whichever shall be the earlier.
18
6.4 Statement on Warrant Certificates. Irrespective of any
adjustment in the number or kind of shares issuable upon the exercise of the
Warrants, Warrant certificates theretofore or thereafter issued may continue to
express the same number and kind of shares as are stated in the Warrant
certificates initially issued.
6.5 Notice to Holders of Dissolution, Liquidation or Winding
Up. Notwithstanding any other provision herein, in the event that, at any time
after the date hereof and prior to the expiration of all Warrants and the
termination of the rights of Holders as provided in Section 1, there shall be a
voluntary or involuntary dissolution, liquidation or winding up of the Company,
then the Company shall mail to each Holder of an outstanding Warrant at the
earliest practicable time (and, in any event, not less than 20 calendar days
before any date set for definitive action) notice in accordance with Section 10
of the date on which such dissolution, liquidation or winding up shall take
place, as the case may be. Such notice shall also specify the date as of which
the holders of the shares of record of Common Stock or other securities issuable
upon exercise of the Warrants shall be entitled to exchange their shares for
securities, money or other property deliverable upon such dissolution,
liquidation or winding up, as the case may be, on which date each Holder of
outstanding Warrants shall be entitled to receive upon surrender of the Warrants
the cash or other property that such Holder would have been entitled to receive
had the Warrants been exercisable and exercised immediately prior to such
dissolution, liquidation or winding up and any and all rights of a Holder to
exercise the Warrants shall terminate in their entirety. In case of any such
voluntary or involuntary dissolution, liquidation or winding up of the Company,
the Company shall, after receipt of surrendered Warrants, make payment in
appropriate amount to such Person or Persons as it may be directed in writing by
the Holder surrendering such Warrants.
6.6 Compliance with Governmental Requirements. The Company
will take from time to time any corporate action that shall, in the opinion of
its counsel, be necessary in order that the Company may validly and legally
issue fully paid and nonassessable shares of Common Stock upon exercise of
Warrants in accordance with this Warrant, including, but not limited to, making
all necessary allocations of surplus to the capital account of the Company in
respect of the shares of Warrant Stock (and Other Securities) that are issuable
upon exercise of the Warrants.
19
The Company covenants that if any shares of Common Stock
required to be reserved for purposes of exercise of Warrants require, under any
Federal or state law or rule or regulation of any national securities exchange,
registration with or approval of any governmental authority, or listing on any
national securities exchange 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; provided, however, that in no event
shall such shares of Common Stock be issued, and the Company is hereby
authorized to suspend the exercise of all Warrants, for the period during which
such registration, approval or listing is required but not in effect.
6.7 No Impairment. The Company shall not take any action,
including, without limitation, amending its certificate of incorporation or
through any reorganization, transfer of assets, consolidation, merger,
dissolution, issuance or sale of securities or any other voluntary action,
designed to avoid the observance or performance of any material 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 actions as may be reasonably necessary
or appropriate to protect the rights of the Holders against impairment. The
foregoing shall not limit or impair the Company's ability to take any action
that in its sole judgment is reasonably necessary for the conduct of its
business.
Without limiting the generality of the foregoing, the Company
will take all such action as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and nonassessable shares of
Common Stock upon the exercise of this Warrant. Upon the reasonable request of
the Holder, the Company will at any time during the period this Warrant is
outstanding acknowledge in writing, in form reasonably satisfactory to the
Holder, the continuing validity of this Warrant and the obligations of the
Company hereunder.
7. Restrictions on Transfer of Warrants, Warrant Stock and
Other Securities. The Warrant Stock and Other Securities may not be sold,
transferred or otherwise disposed of unless registered under the Securities Act
of 1933 (the "Securities Act") and any applicable state securities laws or
pursuant to available exemptions from such registration, provided that the
seller delivers to the Company an opinion of counsel satisfactory to the Company
confirming the availability of such exemption. Unless the shares of Warrant
Stock or Other Securities have been registered under the Securities Act, upon
exercise of any of
20
these Warrants and the issuance of any of the shares of Warrant Stock or Other
Securities, all certificates representing such securities shall bear on the face
thereof substantially the following legend:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 (THE "SECURITIES ACT") OR UNDER APPLICABLE STATE
SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AVAILABLE
EXEMPTIONS FROM SUCH REGISTRATION, PROVIDED THAT THE SELLER
DELIVERS TO THE COMPANY AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY CONFIRMING THE AVAILABILITY OF SUCH EXEMPTION.
8. Notices. All notices required hereunder shall be in writing
and shall be deemed given when telegraphed, delivered personally or within two
days after mailing when mailed by certified or registered mail, return receipt
requested, to the Company at its principal office, or to the Holder at the
address set forth on the record books of the Company, or at such other address
of which the Company or the Holder has been advised by notice in writing
hereunder.
9. Applicable Law. These Warrants shall be governed by, and
construed in accordance with, the laws of the State of New York, without giving
effect to conflicts of law principles.
21
IN WITNESS WHEREOF, the Company has caused these Warrants to
be signed on its behalf, in its corporate name, by its duly authorized officer,
all as of the day and year first above written.
ICon CMT Corp.
By:
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Name:
Title: President
WARRANT EXERCISE FORM
The undersigned hereby irrevocably elects to exercise Warrants to purchase
_______ shares of Common Stock of ICon CMT Corp., a Delaware corporation, and
hereby makes payment of $________ in full satisfaction therefor.
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Signature
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Signature, if jointly held
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Date
INSTRUCTIONS FOR ISSUANCE OF STOCK
(if other than to the Holder of the within Warrants)
Name
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(Please typewrite or print in block letters)
Address
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Social Security or Taxpayer Identification Number
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