SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 13G
INFORMATION STATEMENT PURSUANT TO RULES 13d-1 AND 13d-2
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )1
ON COMMAND
CORPORATION
(Name of Issuer)
Common Stock, par value $ .01 per share
(Title of Class of Securities)
682160106
(CUSIP Number)
Check the following box if a fee is being paid with this statement .
(A fee is not required only if the filing person: (1) has a previous statement
on file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
<PAGE>
3100
Schedule 13G
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CUSIP No. 682160106
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Page 2 of 33 Pages
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13G
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
Ascent Entertainment Group, Inc.
("Ascent") 52-1930707 (1)
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A
GROUP*: (a)
(b)
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3 SEC USE ONLY
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4 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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NUMBER 5 SOLE VOTING POWER
OF
SHARES 18,274,091 (2)
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
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6 SHARED VOTING POWER
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7 SOLE DISTRIBUTIVE POWER
18,274,091 (2)
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8 SHARED DISPOSITIVE POWER
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9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
18,274,091 (2)
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10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9)
EXCLUDES CERTAIN
SHARES*
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11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
58.7% (2)
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12 TYPE OF REPORTING PERSON*
CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) The common stock and Series A Common Stock Purchase Warrants ("Series A
Warrants") (see (2) below) are owned directly by Ascent Network Services,
Inc., a 100% owned subsidiary of the Reporting Person. (2)Ascent owns
17,150,299 shares of the Issuer's common stock and Ascent beneficially
owns Series A Warrants to purchase, on a cashless basis, 1,123,792 shares
of the Issuer's common stock at an exercise price of $15.27 per share. See
Item 4 for a description of the terms of the Series A Warrants.
Item 1(a). Name of Issuer
On Command Corporation
Item 1(b).Address of Issuer's Principal Executive Office
6331 San Ignacio Avenue
San Jose, CA 95119
Item 2(a).Name of Person Filing.
Ascent Entertainment Group, Inc.
Item 2(b).Address of Principal Business Office or, if
None, Residence:
1200 Seventeenth Street, Ste. 2800
Denver, CO 80202
Item 2(c).Citizenship or Place of Organization:
Delaware
Item 2(d).Title of Class of Securities
Common Stock, par value $ .01 per share and Series A Warrants
Item 2(e).CUSIP Number:
Common Stock -- 682160106; Series A Warrants -- 682160114
Item 3.If this statement if filed pursuant to Rules 13d-1(b), or
13d-2(b), check whether the person filing is a:
Not applicable. This statement is being filed pursuant to Rule 13d-1(c).
Item 4.Ownership.
(a)Amount beneficially owned: 18,274,091 shares
(b)Percent of class: 58.7%
(c)Number of shares as to which such person has:
(i) Sole power to vote or direct the vote: 18,274,091
shares.
(ii)Shared power to vote or direct the
vote: 0 shares (3).
(iii)Sole power to dispose or to direct
the disposition of: 18,274,091 shares.
(iv)Shared power to dispose or to direct
the disposition of: 0 shares (3).
Pursuant to a Warrant Agreement between the Issuer and The Bank of New
York, as transfer agent, dated October 8, 1996 (the "Warrant Agreement"), a copy
of which is appended hereto as Exhibit 99.1, the Issuer has issued to Ascent
Series A Warrants to purchase on a cashless basis 1,124,325 shares of On Command
common stock at a price per share of $15.27. The Series A Warrants expire on
October 7, 2003. The foregoing description of the Series A Warrants is qualified
in its entirety by reference to the terms of the Warrant Agreement and the
exhibits thereto, attached hereto as Exhibit 99.1, which terms are incorporated
herein by reference.
Item 5.Ownership of Five Percent or Less of a Class.
Not applicable.
Item 6.Ownership of More than Five Percent on Behalf of
Another Person.
Not applicable.
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(3) Pursuant to the Warrant Agreement, in consideration of the advisory
and other services that Gary Wilson Partners ("GWP") provided to the
Issuer and Ascent in connection with the acquisition of substantially
all of the assets of Spectravision, Inc.(as previously disclosed by
Ascent in its Current Report on Form 8-K, file No. 0-27192, filed with
the Commission on November 14, 1996), the Issuer has issued to GWP
Series C Warrants to purchase for cash an aggregate of 3,450,000
shares of the Issuer's common stock at a exercise price of $15.27 per
share. GWP subsequently distributed the Series C Warrants to its
partners, employees and agents, including Gary L. Wilson, a partner of
GWP and a director of the Issuer and Alfred D. Boyer, a partner of
GWP, who received Series C Warrants to purchase 1,810,000 and 950,000
shares of the Issuer's common stock, respectively. Pursuant to a
Letter Agreement dated April 19, 1996 between Ascent and GWP, all of
the recipients of the Series C Warrants have agreed as follows: (a) so
long as Ascent owns at least 20% of the outstanding shares of the
Issuer's common stock, neither the Series C Warrants nor any shares
acquired pursuant to the Series C Warrants can be sold, assigned or
transferred prior to October 8, 1998 without the prior written consent
of Ascent; and (b) each recipient will vote its shares of the Issuer's
common stock acquired through the exercise of any Series C Warrant in
accordance with the instructions of Ascent, so long as Ascent
continues to own 20% of the outstanding shares of the Issuer's common
stock. As of the date of this filing, none of the recipients had
exercised its rights under the Series C Warrants to purchase shares of
the Issuer's common stock.
<PAGE>
Item 7.
Identification and Classification of the Subsidiary
Which Acquired the Security Being Reported on by the
Parent Holding Company.
Please see attached Exhibit A.
Item 8.Identification and Classification of Members of
the Group.
Not applicable
Item 9.Notice of Dissolution of Group.
Not applicable.
Item 10.Certification.
Not applicable.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
February 14, 1997ASCENT ENTERTAINMENT GROUP, INC.
By: /s/ Arthur M. Aaron
Arthur M. Aaron
Vice President, Business and
Legal Affairs
<PAGE>
EXHIBIT A
Ascent Network Services, Inc., a Delaware corporation ("ANS") directly owns the
17,150,299 shares of On Command common stock and Series A Warrants to purchase
an additional 1,123,792 shares of On Command common stock described in this
Schedule 13(g). Ascent owns 100% of the common stock of ANS (type of reporting
person - CO).
EXHIBIT 99.1
<PAGE>
ON COMMAND CORPORATION
and
THE BANK OF NEW YORK,
as Warrant Agent
WARRANT AGREEMENT
Dated as of October 8, 1996
7,500,000 Common Stock Purchase Warrants
<PAGE>
WARRANT AGREEMENT dated as of October 8, 1996 between On Command
Corporation, a Delaware corporation (the "Company"), and The Bank of New York,
as warrant agent (the "Warrant Agent").
Pursuant to an Acquisition Agreement dated August 13, 1996 (the
"Acquisition Agreement") among, inter alia, the Company and SpectraVision, Inc.,
the Company is proposing to issue Series B Common Stock Purchase Warrants, as
herein described (the "SpectraVision Warrants"), to purchase an aggregate of
2,265,000 shares of Common Stock, $0.01 par value per share, of the Company (the
"Common Stock"). In addition, pursuant to an Agreement and Plan of Merger dated
August 13, 1996 (the "OCV Agreement") among the Company, On Command Merger
Corporation and On Command Video Corporation ("OCV"), the Company is proposing
to issue (a) Series A Common Stock Purchase Warrants, as herein described (the
"Series A Warrants"), to purchase an aggregate of 1,425,000 shares of Common
Stock and (b) Series C Common Stock Purchase Warrants, as herein described (the
"Series C Warrants"), to purchase an aggregate of 3,450,000 shares of Common
Stock. The SpectraVision Warrants, the Series C Warrants and the Series A
Warrants are referred to herein collectively as the "Warrants" and individually
as a "Warrant." Each Warrant entitles the holder thereof to purchase one share
of Common Stock, subject to adjustment as hereinafter provided. The shares of
Common Stock issuable on exercise of the Warrants are referred to herein as the
"Warrant Shares."
The Company wishes the Warrant Agent to act on behalf of the Company, and
the Warrant Agent is willing to act in connection with the issuance, division,
transfer, exchange and exercise of Warrants.
In consideration of the foregoing and for the purposes of defining the
terms and provisions of the Warrants and the respective rights and obligations
thereunder of the Company and the registered owners of the Warrants (the
"Holders"), the Company and the Warrant Agent hereby agree as follows:
<PAGE>
1. Section Appointment of Warrant Agent.
The Company hereby appoints the Warrant Agent to act as agent for the
Company in accordance with the instructions hereinafter in this Agreement set
forth, and the Warrant Agent hereby accepts such appointment and the obligations
hereunder.
2. Section Transferability and Form of Warrant.
2.1. Registration. The Warrant Agent, on behalf of the Company, shall
number and register each series of Warrants in a register (the "Warrant
Register") as they are issued by the Company. The Company and the Warrant Agent
shall be entitled to treat the Holder of any Warrant as the owner in fact
thereof for all purposes and shall not be bound to recognize any equitable or
other claim to or interest in such Warrant on the part of any other person, and
shall not be liable for any registration of transfer of Warrants which are
registered or 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 of transfer, or
with such knowledge of such facts that its participation therein amounts to bad
faith.
<PAGE>
2.2. Transfer. (a) Except as set forth herein, the Warrants and the
Warrant Shares shall not be subject to restrictions on transfer. The Series C
Warrants and the Warrant Shares issuable upon exercise thereof (the "Series C
Warrant Shares") may not be transferred except as provided herein. For so long
as the Series C Warrants and the Series C Warrant Shares are Transfer Restricted
Securities (as defined below), such securities may not be sold, transferred,
pledged or hypothecated unless the registration provisions of the Securities Act
have been complied with or unless the Company has received an opinion of counsel
reasonably satisfactory to the Company that such registration is not required.
"Transfer Restricted Securities" means each Series C Warrant and each
Series C Warrant Share until the earliest to occur of (a) the date on which such
security has been effectively registered in a registration statement under the
Securities Act and disposed of in accordance with such registration statement
and (b) the date on which such security is distributed to the public pursuant to
Rule 144 under the Securities Act.
For so long as any Series C Warrant or Series C Warrant Share is a
Transfer Restricted Security, such security will bear the following legend:
"The securities evidenced hereby have not been registered under the
Securities Act of 1933, as amended. Such securities may not be sold,
transferred, pledged or hypothecated unless the registration provisions of
said Act have been complied with or unless the Company has received an
opinion of counsel reasonably satisfactory to the Company that such
registration is not required."
The Company shall instruct the Warrant Agent in writing of those Series C
Warrants which are subject to legending and shall supply the Warrant Agent with
such legended Warrant Certificates.
(b) Registration of transfer of the Warrants shall be effected only in the
Warrant Register maintained at the principal office of the Warrant Agent upon
delivery thereof duly endorsed by the Holder or by his duly authorized attorney
or representative, or accompanied by proper evidence of succession, assignment
or authority to transfer, which endorsement shall be guaranteed by a bank or
trust company having an office or correspondent in the United States or a broker
or dealer which is a member of a registered national securities exchange or the
National Association of Securities Dealers, Inc. In all cases of transfer by an
attorney, the original power of attorney, duly approved, or a copy thereof, duly
certified, shall be deposited and remain with the Warrant Agent. 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 and remain with the Warrant Agent in its discretion.
Upon any registration of transfer, the Warrant Agent shall countersign and
deliver a new Warrant or Warrants to the person entitled thereto.
2.3. Form of Warrant. The text of the Series A Warrant and of the
form of election to purchase Warrant Shares thereunder shall be substantially as
set forth in Exhibit A attached hereto. The text of the SpectraVision Warrants
and of the form of election to purchase Warrant Shares thereunder shall be
substantially as set forth in Exhibit B attached hereto. The text of the Series
C Warrant and of the form of election to purchase Warrant Shares thereunder
shall be substantially as set forth in Exhibit C attached hereto.
The price per Warrant Share and the number of Warrant Shares issuable upon
exercise of each Warrant are subject to adjustment upon the occurrence of
certain events, all as hereinafter provided. The Warrants shall be executed on
behalf of the Company by the manual or facsimile signature of the Chairman of
the Board, President or any one of the Vice Presidents of the Company, under its
corporate seal, affixed or in facsimile, attested by the manual or facsimile
signature of 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 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 countersignature thereof by the
Warrant Agent (or any successor to the Warrant Agent then acting as warrant
agent under this Agreement, collectively the "Warrant Agent") either upon
initial issuance or upon division, exchange, substitution or transfer.
3. Section Countersignature of Warrants.
The Warrants shall be countersigned by the Warrant Agent and shall not be
valid for any purpose unless so countersigned. Warrants may be countersigned by
the Warrant Agent and may be delivered by the Warrant Agent notwithstanding that
the persons whose manual or facsimile signature appears thereon as proper
officers of the Company shall have ceased to be such officers at the time of
such countersignature, issuance or delivery. The Warrant Agent shall, upon
written instructions of the Chairman of the Board, the President, one of the
Vice Presidents or the Secretary of the Company, countersign, issue and deliver
SpectraVision Warrants, Series A Warrants and Series C Warrants upon initial
issuance entitling the Holders thereof to purchase not more than 2,625,000
Warrant Shares, 1,425,000 Warrant Shares and 3,450,000 Warrant Shares,
respectively (subject, in each case, to adjustment as provided in Section 10
hereof), and shall countersign and deliver Warrants as otherwise provided in
this Agreement.
4. Section Exchange of Warrant Certificates.
Each Warrant certificate of any series may be exchanged for another
certificate or certificates of the same series entitling the Holder thereof to
purchase a like aggregate number of Warrant Shares as the certificate or
certificates surrendered then entitle such Holder to purchase. Any Holder
desiring to exchange a Warrant certificate or certificates shall make such
request in writing delivered to the Warrant Agent, and shall surrender, properly
endorsed, the certificate or certificates to be so exchanged. Thereupon, the
Warrant Agent shall countersign and deliver to the person entitled thereto a
Warrant certificate or certificates, as the case may be, of the same series, as
so requested.
5. Section Term of Warrants; Exercise of Warrants.
5.1. Term of Warrants. (a) Subject to the terms of this Agreement,
each Holder of SpectraVision Warrants and Series C Warrants shall have the
right, which may be exercised at any time prior to and until 5:00 P.M., New York
City Time, on October 7, 2003, to purchase from the Company for cash the number
of fully paid and nonassessable Warrant Shares which the Holder may at the time
be entitled to purchase on exercise of such Warrants.
(b) Subject to the terms of this Agreement, each Holder of Series A
Warrants shall have the right, which may be exercised at any time prior to and
until 5:00 P.M., New York City Time, on October 7, 2003, to receive from the
Company, on a net basis and without the exchange of any funds, that number of
fully paid and nonassessable Warrant Shares which is equal to the number of
Warrant Shares specified in such Holder's Series A Warrants, less a number of
Warrant Shares having an aggregate fair market value (as defined in Section
11.3) at the time of exercise equal to the then Warrant Price multiplied by the
number of Warrant Shares specified in such Holder's Series A Warrants.
(c) Each Warrant not exercised prior to 5:00 P.M., New York City Time, on
October 7, 2003 shall become void and all rights thereunder and all rights in
respect thereof under this Agreement shall cease as of such time.
5.2. Exercise of Warrants. Warrants may be exercised upon (i)
surrender to the Company at the principal office of the Warrant Agent of the
certificate or certificates evidencing the Warrants to be exercised, together
with the form of election to purchase on the reverse thereof duly filled in and
signed, with the signature thereon guaranteed by a bank or trust company having
an office or correspondent in the United States or a broker or dealer which is a
member of a registered securities exchange or the National Association of
Securities Dealers, Inc., and (ii) payment to the Warrant Agent for the account
of the Company of the Warrant Price for the number of Warrant Shares in respect
of which such Warrant is then exercised, such payment to be made in cash, in the
case of the SpectraVision Warrants and the Series C Warrants, and in the manner
provided in Section 5.1(b) in the case of the Series A Warrants. Payment of the
Warrant Price, when payable in cash, shall be made at the option of the Holder
by certified check or official bank check payable to the order of the Company.
No adjustment shall be made in respect of any accrued and unpaid dividends
on any Warrant Shares issued upon exercise of Warrants.
Subject to the provisions of Section 6 hereof, upon such surrender of
Warrants and payment of the Warrant Price as aforesaid, the Company shall issue
and the Warrant Agent shall cause to be delivered with all reasonable dispatch
to or upon the written order of the Holder and in such name or names as the
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 11 of this Agreement, in respect of any fractional
Warrant Share otherwise issuable upon such surrender. 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
Warrant Shares as of the date of the surrender of such Warrants and payment of
the Warrant Price, as aforesaid; provided, however, that if, at the date of
surrender of such Warrants and payment of the Warrant Price, the transfer books
for the Warrant Shares or other class of stock purchasable upon the exercise of
such Warrants shall be closed, the certificates for the Warrant Shares in
respect of which such Warrants are then exercised shall be issuable as of the
date on which such books shall next be opened and until such date the Company
shall be under no duty to deliver any certificate for such Warrant Shares;
provided further, however, that such transfer books unless otherwise required by
law, shall not be closed at any one time for a period longer than twenty days.
The rights of purchase represented by the Warrants shall be exercisable,
at the election of the Holder thereof, either in full or from time to time in
part. In the event that a certificate evidencing Warrants of any series is
exercised in respect of less than all of the Warrant Shares purchasable upon
such exercise at any time prior to the date of expiration of the Warrants, a new
certificate or certificates evidencing the remaining Warrant or Warrants of such
series will be issued, and the Warrant Agent is hereby irrevocably authorized to
countersign and to deliver the required new Warrant certificate or certificates
pursuant to the provisions of this Section and of Section 3 hereof and the
Company, whenever required by the Warrant Agent, will supply the Warrant Agent
with Warrant certificates of the applicable series duly executed on behalf of
the Company for such purpose.
6. Section Payment of Taxes.
The Company will pay all documentary stamp taxes, if any, attributable to
the initial issuance of the Warrant Shares upon the exercise of Warrants;
provided, however, that the Company or the Warrant Agent 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 certificates for Warrant Shares in a
name other than that of the registered Holder of such Warrants.
7. Section Mutilated or Missing Warrants.
In case any of the certificates evidencing the Warrants shall be
mutilated, lost, stolen or destroyed, the Company shall issue, and the Warrant
Agent shall countersign and deliver in exchange and substitution for and upon
cancellation of the mutilated Warrant certificate, or in lieu of and
substitution for the Warrant certificate lost, stolen or destroyed, a new
Warrant certificate of the same series, of like tenor and representing an
equivalent right or interest, but only upon receipt of evidence satisfactory to
the Company and the Warrant Agent of such loss, theft or destruction of such
Warrant certificate and a customary form of indemnity, if requested, also
satisfactory to them. An applicant for such a substitute Warrant certificate
shall also comply with such other reasonable regulations and pay such other
reasonable charges as the Company or the Warrant Agent may prescribe.
8. Section Reservation of Warrant Shares; Purchase of Warrants.
8.1. Reservation of Warrant Shares. There has been reserved, and the
Company shall at all times keep reserved, out of its authorized Common Stock, a
number of shares of Common Stock sufficient to provide for the exercise of the
rights of purchase represented by the outstanding Warrants. The Transfer Agent
for the Common Stock and every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exercise of any of the Warrants will
be irrevocably authorized and directed at all times to reserve such number of
authorized shares as shall be requisite for such purpose. The Company will keep
a copy of this Agreement on file with the Transfer Agent for the Common Stock
and with every subsequent transfer agent for any shares of the Company's capital
stock issuable upon the exercise of the Warrants. The Warrant Agent is hereby
irrevocably authorized to requisition from time to time from such Transfer Agent
the stock certificates then required to honor Warrants that have been
surrendered for exercise thereof in accordance with the terms of this Agreement.
The Company will supply such Transfer Agent with duly executed stock
certificates for such purposes and will provide or otherwise make available any
cash which may be payable as provided in Section 11 hereof. Promptly after the
date of expiration of the Warrants, the Warrant Agent shall certify to the
Company the total aggregate number of Warrants then outstanding, and thereafter
no shares of Common Stock or other capital stock of the Company shall be subject
to reservation for such Warrants.
8.2. Purchase of Warrants by Company.
The Company shall have the right, except as limited by law, other
agreement or herein, to purchase or otherwise acquire Warrants at such times, in
such manner and for such consideration as it may deem appropriate.
8.3. Cancellation of Warrants. In the event the Company shall
purchase or otherwise acquire Warrants, such Warrants shall thereupon be
delivered to the Warrant Agent and be cancelled by it and retired. The Warrant
Agent shall cancel any Warrant surrendered for exchange, substitution, transfer
or exercise in whole or in part, which shall thereafter be delivered to the
Company.
9. Section Warrant Price.
The price per share at which Warrant Shares shall be purchasable upon
exercise of Warrants (the "Warrant Price") shall be $15.27, subject to
adjustment pursuant to Section 10 hereof, such price to be paid in the manner
provided in Section 5.
10. Section 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.
10.1. 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) If the Company:
(i) pays a dividend on its Common Stock in shares of
its Common Stock;
(ii) subdivides its outstanding shares of Common
Stock into a greater number of shares,;
(iii) combines its outstanding shares of Common Stock
into a smaller number of shares;
(iv) distributes to all holders of its Common Stock
shares of its capital stock other than Common Stock; or
(v) issues by reclassification of its Common Stock
any shares of its capital stock;
then, immediately prior to such action, the Warrant Price in effect, and the
number of Warrant Shares purchasable upon exercise of each Warrant shall be
adjusted so that the Holder of any Warrant thereafter exercised may receive the
number of shares of Common Stock or capital stock other than Common Stock of the
Company which he would have owned immediately following such action had such
Warrant been exercised immediately prior to such action. For a dividend or
distribution, the adjustment shall become effective immediately after the record
date for the dividend or distribution. For a subdivision, combination or
reclassification, the adjustment shall become effective immediately after the
effective date of the subdivision, combination or reclassification. If, after an
adjustment, a Holder of Warrants upon exercise may receive shares of two or more
classes of capital stock of the Company, the Board of Directors of the Company
shall determine the allocation of the adjusted Warrant Price between or among
the classes of capital stock. After such allocation, the exchange privilege and
Warrant Price of each class of capital stock shall thereafter be subject to
adjustment on terms comparable to those applicable to Common Stock in this
Section 10 and the provisions of Sections 5, 6 and 8.1 hereof shall apply to
such other class or classes of capital stock.
(b) If the Company:
(i) distributes any rights, options or warrants to all holders of its
Common Stock or to any affiliate (as such term is defined under the
Securities Act) of the Company entitling such holders or such affiliate to
purchase shares of Common Stock at a price per share less than the fair
market value (as defined in Section 11.3 hereof) per share on the record
date for the distribution; or
(ii) (A) sells to any affiliate (as defined above) of the Company any
shares of Common Stock at a price per share that is less than the fair
market value (as defined in Section 11.3 hereof) per share on the date of
such sale or (B) sells to any such affiliate rights, options or warrants
to purchase any shares of Common Stock at a price per right, option or
warrant that, when added to the initial exercise price of such right,
option or warrant, is less than the fair market value (as defined in
Section 11.3 hereof) per share on the date of such sale;
then the Warrant Price shall be adjusted in accordance with the
formula:
O + N x P
E' = E x M
O + N
where:
E' =the adjusted Warrant Price
E = the current Warrant Price
O =the number of shares of Common Stock
outstanding on the record date
N =the number of additional shares of Common Stock into which
such rights, options or warrants initially are exercisable (in the
case of clause (i) or clause (ii)(B)) or the number of additional
shares of Common Stock sold (in the case of clause (ii)(A))
P =the offering price per share of the additional shares (which,
in the case of rights, options and warrants, shall be the aggregate
of the purchase price of such rights, options or warrants and the
initial exercise price of such rights, options or warrants,
calculated on a per share basis)
M =the current market price per share of Common Stock on the
record date (in the case of clause (i)) or the date of sale (in the
case of clause (ii))
and the number of Warrant Shares into which each Warrant is exercisable shall be
adjusted in accordance with the following formula:
N'= N x E
E'
where:
N' =the adjusted number of Warrant Shares issuable upon exercise
of a Warrant by payment of the adjusted Warrant Price
N =the number of Warrant Shares previously issuable upon
exercise of a Warrant by payment of the Warrant Price prior to
adjustment
E' =the adjusted Warrant Price (without giving
effect to the provisions of Section 10.2(a))
E = the Exercise Price prior to adjustment
The adjustment pursuant to this Section 10.1(b) shall become effective
immediately after the record date for the distribution, in the case of an
adjustment pursuant to clause (i) of this Section 10.1(b), and immediately after
the sale, in the case of an adjustment pursuant to clause (ii) of this Section
10.1(b).
(c) If the Company, by dividend or otherwise, distributes to all holders
of its Common Stock cash or assets in an aggregate amount that, together with
any other distributions to all holders of its Common Stock within the 12 months
preceding the date of payment of such distribution and in respect of which no
adjustment pursuant to this clause (c) has been made, exceeds 5% of the product
of the fair market value (as defined in Section 11.3 hereof) per share of the
Common Stock on the record date for such distribution times the number of shares
of Common Stock outstanding on such date, the Warrant Price shall be adjusted in
accordance with the formula:
M - P
E' = E x M
where:
E' = the adjusted Warrant Price
E = the current Warrant Price
P =the amount of cash per share plus the fair market value per
share of the assets (as determined in good faith by the Board of
Directors of the Company as of the record date for the distribution
of such cash or assets) so distributed
M =the current market price per share of Common Stock on the
record date for the distribution of such cash or assets
and the number of Warrant Shares into which each Warrant is exercisable shall be
adjusted in accordance with the formula set forth in clause (b) above.
(d) Whenever the number of Warrant Shares purchasable upon the exercise of
each Warrant or the Warrant Price of such shares is adjusted as herein provided,
the Company shall cause the Warrant Agent promptly to mail by first class mail,
postage prepaid, to each Holder notice of such adjustment or adjustments and
shall file with the Warrant Agent a certificate signed by two officers of the
Company setting forth the Warrant Price and the number of shares into which each
Warrant is exercisable after such adjustment, briefly stating the facts
requiring the adjustment and setting forth in reasonable detail the manner of
computing it. Absent manifest error, the certificate shall be conclusive
evidence that the adjustment is correct. The Warrant Agent shall be under no
duty or responsibility with respect to any such certificate or information
contained therein, except to exhibit the same, from time to time, to any Holder
desiring an inspection thereof during reasonable business hours. The Warrant
Agent shall not at any time be under any duty or responsibility to any Holder to
determine whether any facts exist which may require any adjustment of the
Warrant Price or the number of Warrant Shares purchasable upon exercise of
Warrants or with respect to the nature or extent of any such adjustment when
made, or with respect to the method employed in making such adjustment.
(e) For the purpose of this Section 10.1. the term "shares of Common
Stock" shall mean (i) shares of Common Stock, $0.01 par value per share, of the
Company at the date of this Agreement or (ii) any other class of stock resulting
from successive changes or reclassifications of such shares consisting solely of
changes in par value, or from par value to no par value, or from no par value to
par value.
10.2. Other Adjustments.
(a) No adjustment in the Warrant Price need be made unless the cumulative
adjustment not already made would require an increase or decrease of at least 1%
in the Warrant Price. Any adjustments which are not made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Section 10 and Sections 5 and 11 shall be made to the nearest cent or
the nearest 1/100th of a share, as the case may be.
(b) Except as otherwise provided in Section 10.1 hereof, no adjustment in
the Warrant Price shall be made because the Company issues, in exchange for
cash, property or services, shares of Common Stock, or any securities
convertible into or exchangeable for shares of Common Stock, or securities
carrying the right to purchase shares of Common Stock or such convertible or
exchangeable securities. Furthermore, no adjustment in the Warrant Price need be
made under this Section 10 for sales of shares of Common Stock pursuant to a
plan providing for reinvestment of dividends or interest or in the event the par
value of the Common Stock is changed or in the event the par value of the Common
Stock is eliminated.
(c) In any case in which Section 10.1 shall require that an adjustment as
a result of any event become effective from and after a record date, the Company
may elect to defer until after the occurrence of such event (i) the issuance to
the Holder of any Warrant exercised after such record date and before the
occurrence of such event of the additional Warrant Shares issuable upon such
exchange over and above the shares issuable on the basis of the Warrant Price in
effect immediately prior to the adjustment and (ii) the payment to such Holder
of any amount in cash in lieu of a fractional share of Common Stock pursuant to
Section 11 hereof.
10.3. Preservation of Purchase Rights Upon
Reclassification, Consolidation, etc.
(a) If:
(i) the Company takes any action which would require an adjustment in
the Warrant Price pursuant to clause (iv) or (v) of paragraph (a) of
Section 10.1;
(ii) the Company consolidates or merges with, or transfer all or
substantially all of its assets to, another corporation, and stockholders
of the Company must approve the transaction; or
(iii) there is a dissolution or liquidation of
the Company;
the Company shall cause the Warrant Agent to mail to the Holders, by first class
mail, postage prepaid, (A) in the case of a transaction which stockholders of
the Company must approve, a notice stating the proposed record date for
determining the stockholders entitled to vote to approve such transaction, at
least 10 days before such date, and (B) otherwise, a notice stating the record
date of any distribution (if applicable) or the effective date of the action, at
least 10 days before the earlier of such dates. Failure to mail the notice or
any defect in it shall not affect the validity of any transaction referred to in
clause (i), (ii) or (iii) of this paragraph.
(b) In case of a reclassification, capital reorganization, merger or other
change which reclassifies or changes the Common Stock of the Company or in case
of the consolidation or merger of the Company with or into another corporation
or the conveyance of all or substantially all of the assets of the Company to
another corporation, each Warrant shall thereafter be exercisable for the number
of shares of stock or other securities or property (including cash) to which a
holder of the number of shares of Common Stock of the Company deliverable upon
exercise of such Warrants would have been entitled upon such reclassification,
consolidation, merger or conveyance; and, in any such case, appropriate
adjustment (as determined in good faith by the Board of Directors of the
Company) shall be made in the application of the provisions herein set forth
with respect to the rights and interests thereafter of the Holders, to the end
that the provisions set forth herein (including provisions with respect to
changes in and other adjustments of the Warrant Price) shall thereafter be
applicable, as nearly as reasonably may be, in relation to any shares of stock
or other property thereafter deliverable upon exercise of the Warrants. If this
Section 10.3(b) applies, Section 10.1(a) shall not apply. If the Warrants become
exchangeable solely for cash, no adjustment need be made thereafter. Interest
shall not accrue on the cash.
In the case of such a reclassification, capital reorganization, merger or
other change, the Company or the successor or purchasing corporation and the
Warrant Agent shall execute an agreement setting forth the rights of the Holders
as determined pursuant to the foregoing provisions and the Company or such other
corporation shall make available to the Warrant Agent a sufficient number of
copies of such agreement for delivery to Holders upon request. The Warrant Agent
shall be under no duty or responsibility to determine the correctness of any
provisions contained in any such agreement relating either to the kind or amount
of shares of stock or other securities or property receivable upon exercise of
Warrants or with respect to the method employed and provided therein for any
adjustments.
10.4. Voluntary Reduction in Warrant Price. The Company may, at its
option, at any time and from time to time during the term of the Warrants reduce
the then-current Warrant Price by any amount for any period of time if the
period is at least 15 days and if the reduction is irrevocable during the
period, but in no event shall the Warrant Price be less than the par value of
the Common Stock at the time the reduction is made.
10.5. Statement on Warrants. Irrespective of any adjustments in the
Warrant Price or the number or kind of shares purchasable upon 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. Section Fractional Interests.
11.1. The Company will not issue a fractional Warrant Share upon
exercise of a Warrant. Instead the Company will deliver its check for an amount
equal to the then-fair market value of the fractional share. The fair market
value of a fraction of a share is determined by multiplying the fair market
value per Warrant Share (as defined in Section 11.3 hereof) by the fraction and
rounding the result to the nearest cent.
11.2. If one or more Warrants shall be presented for exercise at the
same time by the same Holder, the number of full Warrant Shares which shall be
issuable upon the exercise thereof shall be computed on the basis of the
aggregate number of Warrant Shares represented by the Warrants so presented.
11.3. For the purpose of any computation under Section 5.1, 10.1 or 11.1, the
fair market value per share of Common Stock on any date is, if the Common Stock
is listed on a national securities exchange (including, without limitation, the
Nasdaq National Market), the average of the last reported sales price per share
of the Common Stock for the 30 consecutive trading days commencing 45 trading
days before the date in question, and, otherwise, the fair market value per
share of the Common Stock as of the date in question as determined in good faith
by the Board of Directors of the Company.
12. Section No Right as Stockholders.
Nothing contained in this Agreement or in any of the Warrants shall be
construed as conferring upon the Holders or their transferees the right to vote
or to receive dividends or to consent or to 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, except as otherwise provided in Section 10.
13. Section Disposition of Proceeds on Exercise of Warrants;
Inspection of Warrant Agreement.
The Warrant Agent shall account promptly to the Company with respect to
Warrants exercised and concurrently pay to the Company all moneys received by
the Warrant Agent for the purchase of the Warrant Shares through the exercise of
such Warrants.
The Warrant Agent shall keep copies of this Agreement and any notices
given or received hereunder available for inspection by the Holders during
normal business hours at its principal office. The Company shall supply the
Warrant Agent from time to time with such number of copies of this Agreement as
the Warrant Agent may request.
14. Section Merger or Consolidation or Change of Name of the
Warrant Agent.
Any corporation into which the Warrant Agent may be merged or with which
it may be consolidated, or any corporation resulting from any merger or
consolidation to which the Warrant Agent is a party, or any corporation
succeeding to the corporate trust business of the Warrant Agent, shall be the
successor to the Warrant Agent hereunder without the execution or filing of any
paper or any further act on the part of any of the parties hereto, provided that
such corporation would be eligible for appointment as a successor Warrant Agent
under the provisions of Section 16 of this Agreement. In case at the time such
successor to the Warrant Agent shall succeed to the agency created by this
Agreement, any of the Warrants shall have been countersigned but not delivered,
any such successor to the Warrant Agent may adopt the countersignature of the
original Warrant Agent and deliver such Warrants so countersigned; and in case
at that time any of the Warrants shall have not been countersigned, any
successor to the Warrant Agent may countersign such Warrants either in the name
of the predecessor Warrant Agent or in the name of the successor Warrant Agent;
and in all such cases such Warrants shall have the full force provided in the
Warrants and in this Agreement.
In case at any time the name of the Warrant Agent shall be changed and at
such time any of the Warrants shall have been countersigned but not delivered,
the Warrant Agent may adopt the countersignature under its prior name and
deliver Warrants so countersigned; and in case at that time any of the Warrants
shall not have been countersigned, the Warrant Agent may countersign such
Warrants either in its prior name or in its changed name; and in all such cases
such Warrants shall have the full force provided in the Warrants and in this
Agreement.
15. Section Concerning the Warrant Agent.
The Warrant Agent hereby undertakes the duties and obligations imposed by
this Agreement upon the following terms and conditions, by all of which the
Company and the Holders, by their acceptance of Warrants, shall be bound:
15.1. The statements contained herein and in the Warrants shall be
taken as statements of the Company, and the Warrant Agent assumes no
responsibility for the correctness of any of the same except such as describe
the Warrant Agent or action taken by it. The Warrant Agent assumes no
responsibility with respect to the distribution of the Warrants except as herein
otherwise provided.
15.2. The Warrant Agent shall not be responsible or liable for any
failure of the Company to comply with any of the covenants contained in this
Agreement or in the Warrants to be complied with by the Company.
15.3. The Warrant Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or by or
through its attorneys or agents (which shall not include its employees), and
shall not be responsible for the misconduct of any agent appointed with due
care.
15.4. The Warrant Agent may consult at any time with legal counsel
satisfactory to it (who may be counsel to the Company) and shall incur no
liability or responsibility to the Company or to any Holder in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
accordance with the opinion or the advice of such counsel.
15.5. Whenever in the performance of its duties under this Agreement
the Warrant Agent shall deem it necessary or desirable that any fact or matter
be proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed conclusively to be proved and
established by a certificate signed by any two officers of the Company and
delivered to the Warrant Agent; and such certificate shall be full authorization
to the Warrant Agent for any action taken or suffered in good faith by it under
the provisions of this Agreement in reliance upon such certificate.
15.6. The Company agrees to pay the Warrant Agent reasonable
compensation for all services rendered by the Warrant Agent in the performance
of its duties under this Agreement, to reimburse the Warrant Agent for all
expenses, taxes and governmental charges and other charges and expenses
(including counsel fees and expenses) of any kind and nature incurred by the
Warrant Agent in the performance of its duties under this Agreement, and to
indemnify the Warrant Agent and save it harmless against any loss, liability or
expense (including judgments, costs and counsel fees and expenses) incurred
without gross negligence or bad faith on its part, arising out of or in
connection with the performance of its duties under this Agreement.
15.7. The Warrant Agent shall be obligated to perform such duties as
are herein and in the Warrant specifically set forth and no implied duties or
obligations shall be read into this Agreement or the Warrants against the
Warrant Agent. The Warrant Agent shall not be under any obligation to take any
action hereunder which may tend to involve it in any expense or liability, the
payment of which within a reasonable time is not, in its reasonable opinion,
assured to it. The Warrant Agent shall not be accountable or under any duty or
responsibility for the use by the Company of any of the Warrants countersigned
by the Warrant Agent and delivered by it to the Company pursuant to this
Agreement or for the application by the Company of the funds or securities
obtained upon payment of the Warrant Price. The Warrant Agent shall have no duty
or responsibility in case of any default by the Company in the performance of
its covenants or agreements contained in the Warrants or in the case of the
receipt of any written demand from a holder of a Warrant with respect to such
default, including, without limiting the generality of the foregoing, any duty
or responsibility to initiate or attempt any proceedings at law or otherwise or
to make any demand upon the Company; provided, however, that if the Warrant
Agent shall receive any notice or demand addressed to the Company by the holder
of a Warrant pursuant to the provisions of the Warrant, the Warrant Agent shall
promptly forward such notice or demand to the Company.
15.8. The Warrant Agent and any stockholder, director, officer or
employee of the Warrant Agent may buy, sell or deal in any of the Warrants or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as though it were not
the Warrant Agent under this Agreement. Nothing herein shall preclude the
Warrant Agent from acting in any other capacity for the Company or for any other
legal entity.
15.9. The Warrant Agent shall act hereunder solely as agent, and its
duties shall be determined solely by the provisions hereof. The Warrant Agent
shall not be liable for anything which it may do or refrain from doing in
connection with this Agreement except for its own gross negligence or bad faith.
15.10. The Warrant Agent will incur no liability or responsibility to
the Company or to any Holder for any action taken in reliance on any notice,
resolution, waiver, consent, order, certificate, or other paper, document or
instrument reasonably believed by it to be genuine and to have been signed, sent
or presented by the proper party or parties.
15.11. The Warrant Agent shall be under no responsibility in respect
of the validity of this Agreement or the execution and delivery hereof (except
the due execution hereof by the Warrant Agent) or in respect of the validity or
execution of any Warrant (except its countersignature thereof); nor shall the
Warrant Agent by any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any Warrant Shares (or other
stock) to be issued pursuant to this Agreement or as to whether any Warrant
Shares (or other stock) will, when issued, be validly issued, fully paid and
nonassessable or as to the Warrant Price, or the number or kind or amount of
Warrant Shares or other securities or other property issuable upon exercise of
any Warrant.
15.12. The Warrant Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from the
Chairman of the Board, the President, any Vice President, the Secretary or the
Treasurer of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and shall not be liable for any
action taken or suffered to be taken by it in good faith in accordance with
instructions of any such officer or officers of for any delay in acting while
waiting for instructions.
15.13. Any application by the Warrant Agent for written instructions
from the Company may, at the option of the Warrant Agent, set forth in writing
any action proposed to be taken or omitted by the Warrant Agent under this
Agreement and the date on and/or after which such action shall be taken or such
omission shall be effective. The Warrant Agent shall not be liable for any
action taken by, or omission of, the Warrant Agent in accordance with a proposal
included in such application on or after the date specified in such application
(which date shall not be less than three Business Days after the date any
officer of the Company actually receives such application, unless any such
officer shall have consented in writing to any earlier date) unless prior to
taking any such action (or the effective date in the case of an omission), the
Warrant Agent shall have received written instructions in response to such
application specifying the action to be taken or omitted.
15.14. If, with respect to any Warrant Certificate surrendered to the
Warrant Agent for exercise or transfer, the certificate attached to the form of
assignment or form of election to purchase or exercise (as the case may be) has
not been completed or indicates an affirmative response to clause 1 or 2
thereof, the Warrant Agent shall not take any further action with respect to
such requested purchase or exercise or transfer without first consulting with
the Company.
15.15. In addition to the foregoing, the Warrant Agent shall be
protected and shall incur no liability for, or in respect of, any action taken
or omitted by it in connection with its administration of this Agreement if such
acts or omissions are in reliance upon (i) the proper execution of the
certification concerning beneficial ownership appended to the form of assignment
and the form of election to purchase or exercise attached hereto unless the
Warrant Agent shall have actual knowledge that, as executed, such certification
is untrue, or (ii) the non-execution of such certification including, without
limitation, any refusal to honor any otherwise permissible assignment or
election by reason of such nonexecution.
15.16. The Company agrees to give the Warrant Agent prompt written
notice of any event or ownership which would prohibit the exercise or transfer
of the Warrant Certificates.
This section shall survive the termination of this Agreement and the
resignation or removal of the Warrant Agent.
16. Section Change of Warrant Agent.
The Warrant Agent may resign and be discharged from its duties under this
Agreement by giving to the Company 30 days' notice in writing. The Warrant Agent
may be removed by like notice to the Warrant Agent from the Company. If the
Warrant Agent shall resign or be removed or shall otherwise become incapable of
acting, the Company shall appoint a successor to the Warrant Agent. If the
Company shall fail to make such appointment within a period of 30 days after
such removal or after it has been notified in writing of such resignation or
incapacity by the resigning or incapacitated Warrant Agent or by any Holder (who
shall with such notice submit his Warrant for inspection by the Company), then
any Holder may apply to any court of competent jurisdiction for the appointment
of a successor to the Warrant Agent. Any successor Warrant Agent (whether
appointed by the Company or such a court) shall be a bank or trust company, in
good standing, incorporated or organized under the laws of the United States of
America or any state thereof or the District of Columbia and having at the time
of its appointment as Warrant Agent a combined capital and surplus of not less
than $500,000,000. Pending appointment of a successor to the Warrant Agent, the
duties of the Warrant Agent shall be performed by the Company.
After appointment, the successor Warrant Agent shall be vested with the
same powers, rights, duties and responsibilities as if it had been originally
named as Warrant Agent without further act or deed. The former Warrant Agent
shall deliver and transfer to the successor Warrant Agent any property at the
time held by it hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. In the event of such
resignation or removal, the successor Warrant Agent shall mail, first class, to
each Holder, written notice of such removal or resignation and the name and
address of such successor Warrant Agent. Failure to file any notice provided for
in this Section 16, however, or any defects therein, shall not affect the
legality or validity of the resignation or removal of the Warrant Agent or the
appointment of the successor Warrant Agent, as the case may be.
17. Section Identity of Transfer Agent.
The name and address of the Company's present Transfer Agent are: The Bank
of New York, One Wall Street, New York, New York 10286. Forthwith upon the
appointment of any subsequent Transfer Agent for the Company's shares of Common
Stock, the Company will file with the Warrant Agent a statement setting forth
the name and address of such Transfer Agent.
18. Section Notices.
Any notice by the Company or the Warrant Agent to the other or by any
Holder to the Company or the Warrant Agent, shall be in writing and delivered in
person or mailed first-class, postage prepaid, (a) if to the Company at its
office at 3301 Olcott Street, Santa Clara, California, 95054, Attention:
Treasurer; (b) if to the Warrant Agent: to The Bank of New York, 101 Barclay
Street, 12W Street, New York, New York 10286, Attention: Amy E. Eaton. The
parties hereto may from time to time change the address to which notices to it
are to be delivered or mailed hereunder by notice in writing to the other party.
No notice given to the Company or the Warrant Agent shall be effective unless
actually received by it.
Any notice mailed pursuant to this Agreement by the Company or the Warrant
Agent to any Holder shall be mailed first class, postage prepaid, or delivered
by messenger or overnight courier service to such Holder at its address shown on
the Warrant Register kept by the Warrant Agent. Failure to mail a notice or
communication to any Holder or any defect in it shall not affect its sufficiency
with respect to other Holders.
If a notice is mailed to a Holder in the manner provided above, it shall
be deemed duly given when received if delivered by messenger, and upon deposit
in the mail or with the courier service if mailed or delivered by overnight
courier service, whether or not the addressee receives it.
19. Section Miscellaneous.
19.1. Successors. All the covenants and provisions of
this Agreement by and for the benefit of the Warrant Agent or the
Company shall bind and inure to the benefit of their respective
successors and assigns.
19.2. Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be
an original, and all of which taken together shall constitute but
one and the same instrument.
19.3. Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise
affect the meaning hereof.
19.4. Governing Law. THIS AGREEMENT AND EACH WARRANT
ISSUED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
19.5. Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
19.6. Benefits of this Agreement. This Agreement is for the sole and
exclusive benefit of the Company, the Warrant Agent and the Holders and nothing
in this Agreement shall be construed to, or give, any person or corporation
other than the Company, the Warrant Agent and the Holders any legal or equitable
right, remedy or claim under this Agreement.
19.7. Amendments. This Agreement may from time to time be amended or
supplemented by the Company and the Warrant Agent without the approval of any
Holder in order to cure any ambiguity or to correct or supplement any provision
contained herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions in regard to matters or questions
arising hereunder which the Company and the Warrant Agent may deem necessary or
desirable and which shall not be inconsistent with the provisions of the
Warrants and shall not adversely affect the interests of the Holders.
19.8. Upon the delivery of a certificate from an appropriate officer
of the Company which states that the proposed supplement or amendment is in
compliance with the terms of this Agreement, the Warrant Agent shall execute
such supplement or amendment.
19.9. Merger or Consolidation of the Company. The Company will not
merge or consolidate with or into any other corporation unless the corporation
resulting from such merger or consolidation (if not the Company) shall expressly
assume, by supplemental agreement reasonably satisfactory in form to the Warrant
Agent and executed and delivered to the Warrant Agent, 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
<PAGE>
ON COMMAND CORPORATION
By:/s/Arthur A. Aaron
[Title]
Attest:
Secretary
THE BANK OF NEW YORK,
as Warrant Agent
By:/s/Amy Eaton
[Title]
Attest:
[Title]
<PAGE>
EXHIBIT A
VOID AFTER 5:00 P.M. NEW YORK CITY TIME ON OCTOBER 7, 2003
Series A Warrants
with respect to _______
No. A-______ Shares of Common Stock
SERIES A
COMMON STOCK PURCHASE WARRANTS
ON COMMAND CORPORATION
Incorporated Under the Laws of the State of Delaware
THIS CERTIFIES THAT, for value received, this Series A Common Stock
Purchase Warrant (the "Warrant") entitles _________________________, the
registered holder hereof, or registered assigns (the "Holder"), to receive from
On Command Corporation, a Delaware corporation (the "Company"), upon exercise of
this Warrant, at any time prior to and until 5:00 P.M., New York City Time, on
October 7, 2003, on a net basis and without the exchange of any funds, that
number of fully paid and nonassessable shares of Common Stock, $0.01 par value
per share, of the Company (the "Common Stock") which is equal to __________
shares of Common Stock, less a number of shares of Common Stock having an
aggregate fair market value (as defined in Section 11.3 of the Warrant Agreement
referred to below) at the time of exercise equal to $15.27 (the "Warrant Price")
multiplied by the number of shares of Common Stock set forth above. The number
of shares covered by this Warrant and the Warrant Price per share shall be
subject to adjustment from time to time as set forth in the Warrant Agreement
referred to below.
This Warrant may be exercised in whole or in part by presentation of this
Warrant with the Purchase Form on the reverse side hereof duly executed, which
signature shall be guaranteed by a bank or trust company having an office or
correspondent in the United States or a broker or dealer which is a member of a
registered securities exchange or the National Association of Securities
Dealers, Inc. at the principal office of The Bank of New York (the "Warrant
Agent"). Upon exercise of this Warrant in whole or in part, the Holder shall be
entitled to receive such number of shares of Common Stock as to which this
Warrant has been exercised, less a number of shares of Common Stock having an
aggregate fair market value (as defined in Section 11.3 of the Warrant Agreement
referred to below) at the time of exercise equal to the Warrant Price multiplied
by such number of shares of Common Stock as to which this Warrant has been
exercised.
This Warrant is one of a duly authorized issue of Series A Common Stock
Purchase Warrants evidencing the right to purchase an aggregate of up to
1,425,000 shares of Common Stock, less a number of shares of Common Stock having
an aggregate fair market value (as defined in Section 11.3 of the Warrant
Agreement) at the time of exercise equal to the Warrant Price multiplied by such
1,425,000 shares of Common Stock, is issued under and in accordance with a
Warrant Agreement (the "Warrant Agreement") dated as of October 8, 1996, between
the Company and the Warrant Agent and is subject to the terms and provisions
contained in the Warrant Agreement, to all of which the Holder of this Warrant
by acceptance hereof consents. A copy of the Warrant Agreement may be obtained
for inspection by the Holder hereof upon written request to the Warrant Agent.
Upon any partial exercise of this Warrant, there shall be countersigned
and issued to the Holder hereof a new Warrant certificate for the balance
remaining of the shares under this Warrant certificate. No fractional shares
will be issued upon the exercise of this Warrant, but the Company shall pay the
cash value of any fraction upon the exercise of one or more Warrants. This
Warrant is transferable at the office of the Warrant Agent in the manner and
subject to the limitations set forth in the Warrant Agreement.
The Holder hereof may be treated by the Company, the Warrant Agent, and
all other persons dealing with this Warrant as the absolute owner hereof for any
purpose and as the person entitled to exercise the rights represented hereby, or
to the transfer hereof on the books of the Company, any notice to the contrary
notwithstanding, and until such transfer on such books, the Company may treat
the Holder hereof as the owner for all purposes.
This Warrant does not entitle any Holder hereof to any rights as a
stockholder of the Company.
This Warrant shall not be valid or obligatory for any purpose until it
shall have been countersigned by the Warrant Agent.
Witness the facsimile seal of the Company and the facsimile signatures of
its duly authorized officers.
Dated: ____________, ____ ON COMMAND CORPORATION
By:
[Title]
[Corporate Seal]
Attest:
[Title]
Countersigned: THE BANK OF NEW YORK,
as Warrant Agent
By:
Authorized Signature
<PAGE>
ON COMMAND CORPORATION
PURCHASE FORM
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant for, and to purchase thereunder,
________ shares of the stock provided for therein, and requests that
certificates be issued for such number of shares, less a number of shares of
such stock having an aggregate fair market value (as defined in Section 11.3 of
the Warrant Agreement) at the time of exercise equal to the Warrant Price
multiplied by such number of shares as to which this Warrant has been exercised
as payment of the Warrant Price, in the name of:
(Please Print Name, Address and Social Security No.)
and, if the number of shares with respect to which this Warrant is hereby
exercised shall not be all the shares for which this Warrant is exercisable,
that a new Warrant certificate for the balance remaining of the shares under the
within Warrant certificate be registered in the name of the undersigned Warrant
holder or his assignee as below indicated and delivered to the address stated
below.
Dated: ____________, _____
Name of Warrant holder or Assignee:
(Please Print)
Address:
Signature:
Signature Guarantee: Note:The above signature must
correspond with the name as written upon the face of
this Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever,
unless this Warrant has been assigned.
<PAGE>
ASSIGNMENT
(To be signed only upon assignment of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns
and transfers to
(Name and Address of Assignee Must be Printed or Typewritten)
the within Warrant, hereby irrevocably constituting and appointing
attorney to transfer said Warrant on the books of the Company, with full power
of substitution in the premises.
Dated: ____________, _____
Name of Warrant holder or Assignee:
(Please Print)
Address:
Signature:
Signature Guarantee: Note:The above signature must
correspond with the name as written upon the face of
this Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever,
unless this Warrant has been assigned.
<PAGE>
EXHIBIT B
VOID AFTER 5:00 P.M. NEW YORK CITY TIME ON OCTOBER 7, 2003
Series B Warrants
to Purchase ________
No. B-______ Share of Common Stock
SERIES B
COMMON STOCK PURCHASE WARRANTS
ON COMMAND CORPORATION
Incorporated Under the Laws of the State of Delaware
THIS CERTIFIES THAT, for value received, this Series B Common Stock
Purchase Warrant (the "Warrant") entitles _________________________, the
registered holder hereof, or registered assigns (the "Holder"), to purchase from
On Command Corporation, a Delaware corporation (the "Company"), at any time
prior to and until 5:00 P.M., New York City Time, on October 7, 2003, at the
cash purchase price of $15.27 per share (the "Warrant Price"), the number of
fully paid and nonassessable shares of Common Stock, $0.01 par value per share,
of the Company (the "Common Stock") set forth above. The number of shares
purchasable upon exercise of this Warrant and the Warrant Price per share shall
be subject to adjustment from time to time as set forth in the Warrant Agreement
referred to below.
This Warrant may be exercised in whole or in part by presentation of this
Warrant with the Purchase Form on the reverse side hereof duly executed, which
signature shall be guaranteed by a bank or trust company having an office or
correspondent in the United States or a broker or dealer which is a member of a
registered securities exchange or the National Association of Securities
Dealers, Inc., and simultaneous payment of the Warrant Price (subject to
adjustment) at the principal office of The Bank of New York (the "Warrant
Agent"). Payment of such price shall be made at the option of the holder hereof
by certified check or official bank check payable to the order of the Company.
This Warrant is one of a duly authorized issue of Series B Common Stock
Warrants evidencing the right to purchase an aggregate of up to 2,625,000 shares
of Common Stock and is issued under and in accordance with a Warrant Agreement
(the "Warrant Agreement") dated as of October 8, 1996, between the Company and
the Warrant Agent and is subject to the terms and provisions contained in the
Warrant Agreement, to all of which the Holder of this Warrant by acceptance
hereof consents. A copy of the Warrant Agreement may be obtained for inspection
by the Holder hereof upon written request to the Warrant Agent.
Upon any partial exercise of this Warrant, there shall be countersigned
and issued to the Holder hereof a new Warrant certificate for the balance
remaining of the shares under this Warrant certificate. No fractional shares
will be issued upon the exercise of this Warrant, but the Company shall pay the
cash value of any fraction upon the exercise of one or more Warrants. This
Warrant is transferable at the office of the Warrant Agent in the manner and
subject to the limitations set forth in the Warrant Agreement.
The Holder hereof may be treated by the Company, the Warrant Agent, and
all other persons dealing with this Warrant as the absolute owner hereof for any
purpose and as the person entitled to exercise the rights represented hereby, or
to the transfer hereof on the books of the Company, any notice to the contrary
notwithstanding, and until such transfer on such books, the Company may treat
the Holder hereof as the owner for all purposes.
This Warrant does not entitle any Holder hereof to any rights as a
stockholder of the company.
This Warrant shall not be valid or obligatory for any purpose until it
shall have been countersigned by the Warrant Agent.
Witness the facsimile seal of the Company and the facsimile signatures of
its duly authorized officers.
Dated: ____________, _____ ON COMMAND CORPORATION
By:
[Title]
[Corporate Seal]
Attest:
[Title]
Countersigned: THE BANK OF NEW YORK,
as Warrant Agent
By:
Authorized Signature
<PAGE>
ON COMMAND CORPORATION
PURCHASE FORM
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant for, and to purchase thereunder,
____________ shares of the stock provided for therein, and herewith tenders in
payment for such shares, a certified check or official bank check payable to the
order of On Command Corporation in the amount $________ and requests that
certificates for such shares be issued in the name of:
(Please Print Name, Address and Social Security No.)
and, if the number of shares with respect to which this Warrant is hereby
exercised shall not be all the shares for which this Warrant is exercisable,
that a new Warrant certificate for the balance remaining of the shares under the
within Warrant certificate be registered in the name of the undersigned Warrant
holder or his assignee as below indicated and delivered to the address stated
below.
Dated: ____________, _____
Name of Warrant holder or Assignee:
(Please Print)
Address:
Signature:
Signature Guarantee: Note:The above signature must
correspond with the name as written upon the face of
this Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever,
unless this Warrant has been assigned.
<PAGE>
ASSIGNMENT
(To be signed only upon assignment of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns
and transfers to
(Name and Address of Assignee Must be Printed or Typewritten)
the within Warrant, hereby irrevocably constituting and appointing
attorney to transfer said Warrant on the books of the Company, with full power
of substitution in the premises.
Dated: ____________, _____
Name of Warrant holder or Assignee:
(Please Print)
Address:
Signature:
Signature Guarantee: Note:The above signature must
correspond with the name as written upon the face of
this Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever,
unless this Warrant has been assigned.
<PAGE>
EXHIBIT C
VOID AFTER 5:00 P.M. NEW YORK CITY TIME ON OCTOBER 7, 2003
Series C Warrants
to Purchase ________
No. C-______ Share of Common Stock
SERIES C
COMMON STOCK PURCHASE WARRANTS
ON COMMAND CORPORATION
Incorporated Under the Laws of the State of Delaware
THIS CERTIFIES THAT, for value received, this Series C Common Stock
Purchase Warrant (the "Warrant") entitles _________________________, the
registered holder hereof, or registered assigns (the "Holder"), to purchase from
On Command Corporation, a Delaware corporation (the "Company"), at any time
prior to and until 5:00 P.M., New York City Time, on October 7, 2003, at the
cash purchase price of $15.27 per share (the "Warrant Price"), the number of
fully paid and nonassessable shares of Common Stock, $0.01 par value per share,
of the Company (the "Common Stock") set forth above. The number of shares
purchasable upon exercise of this Warrant and the Warrant Price per share shall
be subject to adjustment from time to time as set forth in the Warrant Agreement
referred to below.
This Warrant may be exercised in whole or in part by presentation of this
Warrant with the Purchase Form on the reverse side hereof duly executed, which
signature shall be guaranteed by a bank or trust company having an office or
correspondent in the United States or a broker or dealer which is a member of a
registered securities exchange or the National Association of Securities
Dealers, Inc., and simultaneous payment of the Warrant Price (subject to
adjustment) at the principal office of The Bank of New York (the "Warrant
Agent"). Payment of such price shall be made at the option of the holder hereof
by certified check or official bank check payable to the order of the Company.
This Warrant is one of a duly authorized issue of Series C Common Stock
Warrants evidencing the right to purchase an aggregate of up to 3,450,000 shares
of Common Stock and is issued under and in accordance with a Warrant Agreement
(the "Warrant Agreement") dated as of October 8, 1996, between the Company and
the Warrant Agent and is subject to the terms and provisions contained in the
Warrant Agreement, to all of which the Holder of this Warrant by acceptance
hereof consents. A copy of the Warrant Agreement may be obtained for inspection
by the Holder hereof upon written request to the Warrant Agent.
Upon any partial exercise of this Warrant, there shall be countersigned
and issued to the Holder hereof a new Warrant certificate for the balance
remaining of the shares under this Warrant certificate. No fractional shares
will be issued upon the exercise of this Warrant, but the Company shall pay the
cash value of any fraction upon the exercise of one or more Warrants. This
Warrant is transferable at the office of the Warrant Agent in the manner and
subject to the limitations set forth in the Warrant Agreement.
The Holder hereof may be treated by the Company, the Warrant Agent, and
all other persons dealing with this Warrant as the absolute owner hereof for any
purpose and as the person entitled to exercise the rights represented hereby, or
to the transfer hereof on the books of the Company, any notice to the contrary
notwithstanding, and until such transfer on such books, the Company may treat
the Holder hereof as the owner for all purposes.
This Warrant does not entitle any Holder hereof to any rights as a
stockholder of the company.
This Warrant shall not be valid or obligatory for any purpose until it
shall have been countersigned by the Warrant Agent.
Witness the facsimile seal of the Company and the facsimile signatures of
its duly authorized officers.
Dated: ____________, _____ ON COMMAND CORPORATION
By:
[Title]
[Corporate Seal]
Attest:
[Title]
Countersigned: THE BANK OF NEW YORK,
as Warrant Agent
By:
Authorized Signature
<PAGE>
ON COMMAND CORPORATION
PURCHASE FORM
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant for, and to purchase thereunder,
____________ shares of the stock provided for therein, and requests that
certificates for such shares be issued in the name of:
(Please Print Name, Address and Social Security No.)
and, if the number of shares with respect to which this Warrant is hereby
exercised shall not be all the shares for which this Warrant is exercisable,
that a new Warrant certificate for the balance remaining of the shares under the
within Warrant certificate be registered in the name of the undersigned Warrant
holder or his assignee as below indicated and delivered to the address stated
below.
Dated: ____________, _____
Name of Warrant holder or Assignee:
(Please Print)
Address:
Signature:
Signature Guarantee: Note:The above signature must
correspond with the name as written upon the face of
this Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever,
unless this Warrant has been assigned.
<PAGE>
ASSIGNMENT
(To be signed only upon assignment of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns
and transfers to
(Name and Address of Assignee Must be Printed or Typewritten)
the within Warrant, hereby irrevocably constituting and appointing
attorney to transfer said Warrant on the books of the Company, with full power
of substitution in the premises.
Dated: ____________, _____
Name of Warrant holder or Assignee:
(Please Print)
Address:
Signature:
Signature Guarantee: Note:The above signature must
correspond with the name as written upon the face of
this Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever,
unless this Warrant has been assigned.
- - --------
1The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to the
subject class of securities, and for any subsequent amendment
containing information
which would alter the disclosures provided in a prior
cover page.
The information required in the remainder of this cover
page shall not be deemed to be "filed" for the purpose
of Section 18 of the Securities Exchange Act of 1934 or otherwise
subject to the liabilities of that section of the Act but shall be
subject to all other provisions of
the Act (however, see the Notes).
