<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-
1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)
HomeSeekers.com, Incorporated
-----------------------------
(Name of Issuer)
Common Stock
------------
(Title of Class of Securities)
437605108
---------
(CUSIP Number)
Liu Wai Fun Jennifer
the property portal! Limited
Room 2010
The Center
99 Queen's Road Central
Hong Kong
852-2869-6669
-------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 19, 2000
------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), Rule 13d-1(f) or Rule 13d-1(g), check the
following box [__]
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
*The 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
disclosures provided in a prior cover page.
The information required on 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 ("Act") 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).
<PAGE>
CUSIP No. 437605108 13D Page 2 of 12
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON (ENTITIES ONLY)
the property portal!, Limited
- ----------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [__]
(b) [__]
- ----------------------------------------------------------------------------
3 SEC USE ONLY
- ----------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- ----------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [__]
- ----------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Hong Kong
- ----------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY 1,638,750
OWNED BY EACH
REPORTING
PERSON WITH
- ----------------------------------------------------------------------------
8 SHARED VOTING POWER
- ----------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
1,638,750
- ----------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- ----------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,638,750
- ----------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [__]
- ----------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.1%
- ----------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- ----------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
CUSIP No. 437605108 13D Page 3 of 12
Item 1. Security and Issuer.
This Schedule 13D relates to the common stock, $0.001 par value per share, of
HomeSeekers.com, Inc., a Nevada corporation ("HomeSeekers"). HomeSeekers's
principle executive office is located at 6490 South McCarran Boulevard, Suite D-
28, Reno, Nevada 89509.
Item 2. Identity and Background.
This statement is filed by the property portal!, Limited, a Hong Kong
corporation ("Property Portal"). Its principal business is the operation of a
property web portal site and database in Hong Kong for the Chinese real property
industry. Its principal business office is located at Room 2010, The Center, 99
Queen's Road Central, Hong Kong.
The following are the names and principal occupations of each executive officer
and director of Property Portal, the business address of which is the same as
Property Portal unless otherwise noted:
<TABLE>
<CAPTION>
Name (Business Title Citizenship Principal Occupation
Address) ----- ----------- --------------------
--------
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Johnson Chen Director Hong Kong Managing Director of Cyberworks Ventures, an investment
(38th Floor, firm located at 38th Floor, Citibank Tower, Citibank Plaza,
Citibank Tower, 3 Garden Road, Central, Hong Kong.
Citibank Plaza, 3
Garden Road,
Central, Hong Kong)
- -------------------------------------------------------------------------------------------------------------------
Liu Wai Fun Executive Hong Kong Executive Director of Property Portal.
Jennifer Director
- -------------------------------------------------------------------------------------------------------------------
Fok Chun Yue Director Hong Kong Chairman of New Epoch Information Company Limited, a holding
Benjamin company for investment assets located at 33 Sassoon Road,
(33 Sassoon Road, Pokfulam Road, Hong Kong.
Pokfulam Road,
Hong Kong)
- -------------------------------------------------------------------------------------------------------------------
Liu Tong Rita (7th Director Hong Kong Individual investor.
Floor, Times
Tower, 393 Jaffe
Road, Wanchai,
Hong Kong)
- -------------------------------------------------------------------------------------------------------------------
Gregory L. Costley Director United States Chairman and Chief Executive Officer and Director of
(6490 South HomeSeekers, a provider of online residential real estate
McCarran information and related services located at 6490 South
Boulevard, Suite McCarran Boulevard, Suite D-29, Reno, NV 89509.
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
CUSIP No. 437605108 13D Page 4 of 12
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
D-29, Reno, NV
89509)
- -------------------------------------------------------------------------------------------------------------------
Bradley N. Rotter Director United States Chairman of the Board of Point West Capital Corporation, a
(1700 Montgomery specialty financial services company located at 1700
Street, Suite 250, Montgomery Street, Suite 250, San Francisco, CA 94111. Also
San Francisco, CA a Director of HomeSeekers.
94111)
- -------------------------------------------------------------------------------------------------------------------
Lui Sai Kit Chief Hong Kong COO of Property Portal
Operations
Officer
- -------------------------------------------------------------------------------------------------------------------
Kenneth Mui Chief Hong Kong CFO of Property Portal
Financial
Officer
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
Neither Property Portal nor any of the persons named above have been convicted
in the last five years in any criminal proceedings nor were any of them a party
to any civil proceedings of a judicial or administrative body of competent
jurisdiction which had as a result any judgement, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, Federal or State securities laws or finding any violation with respect to
such laws.
Item 3. Source and Amount of Funds or Other Consideration.
Pursuant to a Stock Purchase Agreement dated as of May 16, 2000 (the "Stock
Purchase Agreement") by and among HomeSeekers, Property Portal and Cyber
Exposure Limited ("CEL"), Denwell Enterprises Limited ("Denwell"), Galaxy Luck
Enterprises Limited ("Galaxy"), Wired Technology Consultants Group Limited
("WTCG"), Unicrown Limited ("Unicrown") and Newsino Limited ("Newsino," and
together with CEL, Denwell, Galaxy, WTCG and Unicrown, collectively, the
"Existing Shareholders"):
(a) 1,638,750 shares of HomeSeekers common stock were issued to
Property Portal on May 19, 2000 in exchange for 1,613,000 ordinary shares of
Property Portal, HK$1.00 par value per share; and
(b) each of the Existing Shareholders received warrants to purchase an
aggregate of up to of 1,000,000 additional shares of HomeSeekers common stock at
a purchase price of $7.00 per share as set forth below:
Number of shares
subject to Warrant
------------------
CEL.....................650,000
Denwell..................35,000
Galaxy...................63,000
WTCG....................115,500
Unicrown................112,000
Newsino..................24,500
<PAGE>
CUSIP No. 437605108 13D Page 5 of 12
Item 4. Purpose of Transaction.
Property Portal acquired the shares of HomeSeekers common stock reported on this
statement as consideration for the issuance of its ordinary shares to
HomeSeekers pursuant to the Stock Purchase Agreement. The Stock Purchase
agreement was entered into in connection with a technology license and service
agreement pursuant to which HomeSeekers will provide technology and consulting
services to Property Portal for use in Property Portal's present and future
operations in China, Hong Kong, Taiwan, Singapore, Malaysia and Thailand.
Property Portal does not currently have any plans or proposals to:
(a) acquire additional shares of HomeSeekers;
(b) engage in any extraordinary corporate transaction, such as a merger,
reorganization or liquidation, with HomeSeekers or any of its
subsidiaries;
(c) sell or transfer a material amount of assets of HomeSeekers or any of
its subsidiaries;
(d) make any change in the present board of directors or management of
HomeSeekers;
(e) make any material change in the present capitalization or dividend
policy of HomeSeekers;
(f) make any other material change in HomeSeekers's business or corporate
structure;
(g) make any change in HomeSeekers's charter or bylaws or other actions
which may impede the acquisition of control of the issuer by any
person;
(h) cause a class of securities of HomeSeekers to be delisted from a
national securities exchange or to cease to be authorized to be quoted
in an inter-dealer quotation system of a registered national
securities association;
(i) cause a class of equity securities of HomeSeekers to become eligible
for termination of registration pursuant to Section 12(g)(4) of the
Act; or
(j) take any other action similar to those enumerated above.
Property Portal may review or reconsider its position with respect to
HomeSeekers or to formulate plans or proposals with respect to any such matter
but has no present intention to do so.
<PAGE>
CUSIP No. 437605108 13D Page 6 of 12
Item 5. Interest in Securities of the Issuer.
Property Portal beneficially owns 1,638,750 currently issued shares of common
stock of HomeSeekers, which represents approximately 8.1% of the outstanding
20,254,849 shares of HomeSeekers common stock. Property Portal has the sole
power to vote and dispose of all of such shares.
As the controlling shareholder of Galaxy, Liu Tong Rita beneficially owns the
63,000 shares subject to the warrant received by Galaxy described under Item 3
above and has sole power to vote and dispose of such shares Such shares
represent approximately 0.3% of the outstanding shares of HomeSeekers common
stock.
As the controlling shareholder of Denwell, Fok Chun Yue Benjamin beneficially
owns the 35,000 shares subject to the warrant received by Denwell described
under Item 3 above and has sole power to vote and dispose of such shares. Such
shares represent approximately 0.2% of the outstanding shares of HomeSeekers
common stock.
Unicrown and Newsino are the controlling shareholders of WTCG.
As the controlling shareholder of Unicrown, Johnson Chen beneficially owns the
112,000 and 115,500 shares subject to the warrants received by Unicrown and
WTCG, respectively, described under Item 3 above, and has sole power to vote and
dispose of the 112,000 shares and shared power to vote and dispose of the
115,500 shares. The shares beneficially owned by Mr. Chen represent in aggregate
approximately 1.1% of the outstanding shares of HomeSeekers common stock. Mr.
Chen is a Managing Director of CEL's parent company, Cyberworks Ventures, but
does not have sole or shared power to vote or dispose of the 650,000 shares
subject to the warrant received by CEL.
As the controlling shareholder of Newsino, Lui Wai Fun Jennifer beneficially
owns the 24,500 and 115,500 shares subject to the warrants received by Newsino
and WTCG, respectively, described under Item 3 above, and has sole power to vote
and dispose of the 24,500 shares and shared power to vote and dispose of the
115,500 shares. Such shares represent in aggregate approximately 0.7% of the
outstanding shares of HomeSeekers common stock.
Gregory L. Costley beneficially owns 108,818 shares of HomeSeekers common stock,
including options to purchase 100,375 shares. Mr. Costley has sole power to
vote and dispose of all of such shares. Such shares represent approximately
0.5% of the outstanding shares of HomeSeekers common stock.
Bradley N. Rotter beneficially owns 383,333 shares of HomeSeekers common stock,
including warrants to purchase 50,000 shares and 246,500 shares owned by Point
West Ventures, L.P.
<PAGE>
CUSIP No. 437605108 13D Page 7 of 12
As Chairman of Point West Ventures, Mr. Rotter has shared power to vote and
dispose of the shares owned by Point West Ventures and disclaims beneficial
ownership of such shares except to the extent of his pecuniary interest therein.
Mr. Rotter has sole power to vote and dispose of all remaining shares
beneficially owned by him. The shares beneficially owned by Mr. Rotter represent
approximately 1.9% of the outstanding shares of HomeSeekers common stock.
Lui Sai Kit and Kenneth Mui do not beneficially own any shares of HomeSeekers
common stock.
Neither Property Portal nor any of the other persons named above has effected
any transactions in shares of HomeSeekers common stock in the past 60 days
except as described above.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect
to Securities of the Issuer.
There are no contracts, arrangements, understandings or relationships (legal or
otherwise) among the persons named in Item 2 and between such persons and any
person with respect to any securities of HomeSeekers, including but not limited
to transfer or voting of any of the securities, finders' fees, joint ventures,
loan or option arrangements, puts or calls, guaranties of profits, divisions of
profits or loss or the giving or withholding of proxies, except as described in
Item 5 or below:
Pursuant to the Stock Purchase Agreement:
(a) HomeSeekers agreed to use its best efforts to file a registration
statement with the Securities and Exchange Commission registering the
shares of HomeSeekers common stock received by Property Portal for
resale within the later of 20 days after the signing of the Stock
Purchase Agreement and five days after the closing of the transaction,
which occurred on May 19, 2000, and to maintain the effectiveness of
such registration statement until the earlier of (1) the second
anniversary of such closing; (2) the date on which all of the shares
of HomeSeekers common stock received by Property Portal have been sold
pursuant to such registration statement; and (3) the date on which all
such shares may be sold in any consecutive three-month period in
accordance with Rule 144 under the Act;
(b) Property Portal agreed that it shall at no time sell, in any one
trading day, an aggregate amount of shares of HomeSeekers common stock
that exceeds 25% of the volume of the shares of HomeSeekers common
stock traded on the previous trading day; and
(c) Each of the Exisiting Shareholders received a warrant to purchase
shares of HomeSeekers common stock as described in Item 2 above See
form of Warrant filed herewith as Exhibit 2.
<PAGE>
CUSIP No. 437605108 13D Page 8 of 12
Mr. Costley holds options to purchase 100,375 shares of HomeSeekers common
stock. The options covering 100,000 of such shares were granted to Mr. Costley
in his Employment Agreement with HomeSeekers filed herewith as Exhibit 3 and are
exercisable at a price per share equal to the closing bid price for HomeSeekers
common stock on the date Mr. Costley's agreement became effective ($7.94). That
grant also covers an additional 200,000 shares at that price which vest and
become exercisable to the extent of 100,000 shares on each of August 23, 2000
and August 23, 2001. Mr. Costley's employment agreement also provides for
an additional option to purchase 100,000 shares of HomeSeekers common stock (to
be priced at $17.94, $27.94, etc.) for every $10 increase in stock price from
the closing bid price on the day his agreement became effective ($7.94) that
stays at the higher level for a period of 90 days thereafter, with a term of
three years from the date of the agreement. The remaining 375 shares subject to
options held by Mr. Costley relate to a grant of options to purchase 1,500
shares at an exercise price of $7.94 per share of which one-fourth will have
vested or become exercisable within 60 days. These options were granted in the
letter agreement filed herewith as Exhibit 4.
Mr. Rotter received a warrant to purchase 150,000 shares of HomeSeekers common
stock at an exercise price of $4.00 per share on March 15, 1999, which vests and
becomes exercisable to the extent of 50,000 shares on each of March 15, 2000,
March 15, 2001 and March 15, 2002.
Neither Property Portal nor any of the persons named in Item 2 above, either
individually or as a controlling shareholder of any other entity, is acting as a
group with any other person for the purpose of acquiring, holding, or disposing
of any securities of HomeSeekers.
<PAGE>
CUSIP No. 437605108 13D Page 9 of 12
Item 7. Material to be Filed as Exhibits.
1. Stock Purchase Agreement, dated as of May 16, 2000, by and among
HomeSeekers.com, Incorporated, the property portal! Limited, Cyber Exposure
Limited, Denwell Enterprises Limited, Galaxy Luck Enterprises Limited, Wired
Technology Consultants Group Limited, Unicrown Limited, and Newsino Limited
(incorporated by reference to Exhibit 2.1 to the HomeSeekers.com, Incorporated
Current Report on Form 8-K filed with the Securities and Exchange Commission on
May 17, 2000).
2. Form of Warrant issued to each Existing Shareholder.
3. Employment Agreement between HomeSeekers.com, Incorporated and Greg
Costley dated August 23, 1999 (incorporated by reference to Exhibit 6.11 to the
HomeSeekers.com, Incorporated Annual Report on Form 10-KSB for the fiscal year
ended June 30, 1999).
4. Letter Agreement dated October 20, 1999 by and between HomeSeekers.com,
Incorporated and Gregory L. Costley.
5. HomeSeekers.com, Incorporated Amended and Restated 1996 Stock Option
Plan (incorporated by reference to Exhibit 4(a) to the HomeSeekers.com,
Incorporated Registration Statement on Form S-8 File No. 333-77989 filed May
7, 1999).
<PAGE>
CUSIP No. 437605108 13D Page 10 of 12
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.
May 26, 2000
THE PROPERTY PORTAL!, LIMITED
By: /s/ LIU WAI FUN JENNIFER
_____________________________
Name: Liu Wai Fun Jennifer
Title: Executive Director
<PAGE>
Exhibit 2
[FORM OF WARRANT]
THESE SECURITIES AND THE SECURITIES TO BE ISSUED UPON ANY EXERCISE OF THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
"SECURITIES ACT") NOR PURSUANT TO THE SECURITIES OR "BLUE SKY" LAWS OF ANY
STATE. SUCH SECURITIES MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED, EXCEPT (A) IN ACCORDANCE WITH
REGULATION S PROMULGATED UNDER THE SECURITIES ACT ("REGULATION S") OR (B)
PURSUANT TO (i) A REGISTRATION STATEMENT WITH RESPECT TO SUCH SECURITIES
THAT IS EFFECTIVE UNDER SUCH ACT, (ii) RULE 144 OR RULE 144A UNDER SUCH ACT
OR (iii) ANY OTHER EXEMPTION FROM REGISTRATION UNDER SUCH ACT, PROVIDED
THAT IN A TRANSACTION PURSUANT TO (iii) ABOVE, IF REQUESTED BY THE ISSUER
HEREOF, AN OPINION OF COUNSEL REASONABLY SATISFACTORY IN FORM AND SUBSTANCE
IS FURNISHED TO SUCH ISSUER STATING THAT AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF SUCH ACT IS AVAILABLE. IN ADDITION, SUCH SECURITIES MAY
NOT BE EXERCISED BY OR ON BEHALF OF ANY U.S. PERSON (WITHIN THE MEANING OF
REGULATION S) UNLESS REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION
FROM SUCH REGISTRATION IS AVAILABLE, AND HEDGING TRANSACTIONS INVOLVING
THESE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE
SECURITIES ACT.
HOMESEEKERS.COM, INCORPORATED
Common Stock Warrant
Expiring May 19, 2001
May 19, 2000
No. _____
HOMESEEKERS.COM, INCORPORATED, a Nevada corporation (herein, together
with its successors and assigns, the "Company"), for value received, hereby
certifies that ____________________________________, or registered assigns, is
entitled to purchase from the Company, at any time or from time to time prior to
5:00 p.m., New York City time, on May 19, 2001 (or such earlier date as may be
determined pursuant to Section 13 hereof), ______________ duly authorized,
validly issued, fully paid and nonassessable shares of Common Stock, par value
$.001 per share, as constituted on May 19, 2000 (the "Common Stock"), of the
Company at a purchase price of $7.00 per share (subject to the adjustment in
accordance with Section 2, the "Warrant Price"), all subject to the terms,
conditions and adjustments set forth below in this Warrant.
<PAGE>
<PAGE>
1 Exercise of Warrant.
-------------------
1.1 Manner of Exercise. Subject to Section 6, this Warrant may be
------------------
exercised by the holder hereof, in whole or in part, during normal business
hours on any Business Day by surrender of this Warrant to the Company at the
office of the Company maintained pursuant to Section 7.2(a), accompanied by a
subscription in substantially the form annexed hereto duly executed by such
holder and (a) by payment in cash or by certified or official bank check payable
to the order of the Company or by wire transfer in the amount obtained by
multiplying (i) the number of shares of Common Stock (without giving effect to
any adjustment therein) designated in such subscription by (ii) the then
applicable Warrant Price, (b) by instructing the Company to withhold and cancel
a number of shares of Common Stock then issuable upon exercise of this Warrant
with respect to which the excess of the Market Price of the shares of Common
Stock over the Warrant Price for such canceled shares is at least equal to the
Warrant Price for the shares being purchased or (c) by any combination of the
foregoing, whereupon such holder shall be entitled to receive the number of duly
authorized, validly issued, fully paid and nonassessable shares of Common Stock
(or Other Securities) determined as provided in Section 2.
1.2 When Exercise Effective. Any exercise of this Warrant shall be deemed
-----------------------
to have been effected immediately prior to the close of business on the Business
Day on which this Warrant shall have been surrendered to the Company as provided
in Section 1.1, and at such time the Person or Persons in whose name or names
any certificate or certificates for shares of Common Stock (or Other Securities)
shall be issuable upon such exercise as provided in Section 1.3 shall be deemed
to have become the holder or holders of record thereof.
1.3 Delivery of Stock Certificates, etc. As soon as practicable after the
-----------------------------------
exercise of this Warrant, in whole or in part, and in any event within three
Business Days thereafter, the Company at its expense (including the payment by
it of any applicable issuance taxes) will cause to be issued in the name of and
delivered to the holder hereof or, subject to Section 6, as such holder (upon
payment by such holder of any applicable transfer taxes) may direct: (a) a
certificate or certificates for the number of duly authorized, validly issued,
fully paid and nonassessable shares of Common Stock (or Other Securities) to
which such holder shall be entitled upon such exercise plus, in lieu of any
fractional share to which such holder would otherwise be entitled, cash in an
amount equal to the same fraction of the Market Price per share on the Business
Day next preceding the date of such exercise; and (b) in case such exercise is
in part only, a new Warrant or Warrants of like tenor, calling in the aggregate
on the face or faces thereof for issuance of the number of shares of Common
Stock equal (without giving effect to any adjustment therein) to the number of
such shares called for on the face of this Warrant minus the number of such
shares so designated by such holder upon such exercise as provided in Section
1.1.
2
<PAGE>
2 Certain Adjustments to Warrant.
------------------------------
2.1 Adjustment for Dividends, Distributions, Subdivisions, Combinations
-------------------------------------------------------------------
or Consolidation of Common Stock.
- --------------------------------
2.1.1 Stock Dividends, Distributions or Subdivisions. In the event the
----------------------------------------------
Company shall issue additional shares of Common Stock in a stock dividend, stock
distribution or subdivision, the Warrant Price in effect immediately prior to
such stock dividend, stock distribution or subdivision shall, concurrently with
the effectiveness of such stock dividend, stock distribution or subdivision, be
proportionately decreased.
2.1.2 Combinations or Consolidations. In the event the outstanding shares
------------------------------
of Common Stock shall be combined or consolidated, by reclassification or
otherwise, into a lesser number of shares of Common Stock, the Warrant Price in
effect immediately prior to such combination or consolidation shall,
concurrently with the effectiveness of such combination or consolidation, be
proportionately increased.
2.2 Adjustment for Merger or Reorganization, etc. Subject to the
--------------------------------------------
provisions of Section 13, in case of any reorganization of the Company, any
consolidation or merger of the Company with or into another Company or the
conveyance of all, or substantially all, of the assets of the Company to another
Person, then, as a part of such reorganization, consolidation, merger or
conveyance, lawful provision shall be made so that this Warrant shall thereafter
be exercisable to purchase the number of shares of stock or other securities or
property to which a holder of the number of shares of Common Stock of the
Company deliverable upon exercise of this Warrant would have been entitled upon
such reorganization, consolidation, merger or conveyance; and, in any such case,
appropriate adjustment (as determined by the Board of Directors) shall be made
in the application of the provisions herein set forth with respect to the rights
and interest thereafter of the holder of this Warrant to the end that the
provisions set forth in Section 2.1 and this Section 2.2 (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 the exercise of
this Warrant.
3 No Dilution or Impairment. The Company (a) will not, by any
-------------------------
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Company, (b) will at all
times in good faith assist in carrying out all of the provisions of Sections 2,
3 and 4 and in the taking of all such action as may be necessary or appropriate
in order to protect the rights of the holder of this Warrant against impairment,
(c) will not permit the par value of any shares of stock receivable upon any
exercise of this Warrant to exceed the amount payable therefor upon such
exercise, (d) 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 stock upon each exercise of this Warrant and (e) will
not take any action that results in any adjustment of the Warrant Price if the
total number of shares of Common Stock (or Other Securities) issuable after such
action, upon any exercise of this Warrant, would exceed the total number of
shares of Common Stock (or Other Securities) then authorized by the Company's
articles of incorporation and available for the purpose of issuance upon such
exercise.
3
<PAGE>
4 Report as to Adjustments. In each case of any adjustment or
------------------------
readjustment in the shares of Common Stock (or Other Securities) issuable upon
the exercise or conversion of this Warrant, the Company at its expense will
promptly compute such adjustment or readjustment in accordance with the terms of
this Warrant and prepare a report setting forth such adjustment or readjustment
and showing in detail the method of calculation thereof and the facts upon which
such adjustment or readjustment is based, including a statement of the Warrant
Price in effect immediately prior to such issuance or sale and as adjusted and
readjusted (if required by Section 2) on account thereof. The Company will
forthwith (and in any event not later than 20 days following the occurrence of
the event requiring such adjustment) furnish a copy of each such report to each
holder of this Warrant, and will, upon the written request at any time of any
holder of this Warrant, furnish to such holder a like report setting forth the
Warrant Price at the time in effect and showing how it was calculated. The
Company also will keep copies of all such reports at its principal office and at
the office or agency required to be maintained by it pursuant to Section 7.2(a),
and will cause the same to be available for inspection at each such office
during normal business hours by any holder of this Warrant or any prospective
purchaser of this Warrant designated by the holder thereof.
5 Restrictions on Transfer.
------------------------
5.1 Restrictive Legends. Except as otherwise permitted by this Section 5,
-------------------
each Warrant originally issued, each Warrant issued upon direct or indirect
transfer or in substitution for any Warrant pursuant to Section 7, each
certificate for Common Stock (or Other Securities) issued upon the exercise of
any Warrant, and each certificate issued upon the direct or indirect transfer of
any such Common Stock (or Other Securities), shall be stamped or otherwise
imprinted with a legend in substantially the following form, with appropriate
modifications to such legend to be made if required by Regulation S:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
NOR PURSUANT TO THE SECURITIES OR "BLUE SKY" LAWS OF ANY STATE. SUCH
SECURITIES MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR
OTHERWISE ASSIGNED, EXCEPT PURSUANT TO (i) A REGISTRATION STATEMENT WITH
RESPECT TO SUCH SECURITIES THAT IS EFFECTIVE UNDER SUCH ACT, (ii) RULE 144
OR RULE 144A UNDER SUCH ACT OR (iii) ANY OTHER EXEMPTION FROM REGISTRATION
UNDER SUCH ACT, PROVIDED THAT IN A TRANSACTION PURSUANT TO (iii) ABOVE, IF
REQUESTED BY THE ISSUER HEREOF, AN OPINION OF COUNSEL REASONABLY
SATISFACTORY IN FORM AND SUBSTANCE IS FURNISHED TO SUCH ISSUER STATING THAT
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT IS AVAILABLE.
5.2 Notice of Proposed Transfer; Opinions of Counsel. Prior to any
------------------------------------------------
transfer of any Restricted Securities that are not registered pursuant to an
effective registration statement under the Securities Act (other than a transfer
pursuant to Rule 144, Rule 144A or any comparable rule under the Securities
Act), the holder thereof will give written notice to the Company of such
holder's intention to effect such transfer and to comply in all other respects
with this Section 5.2. Each such notice shall (a) describe the manner and
circumstances of the proposed transfer in sufficient detail to enable counsel to
render the opinion referred to below
4
<PAGE>
and (b) designate counsel for the holder giving such notice, which counsel shall
be reasonably satisfactory to the Company. The holder giving such notice will
submit a copy thereof to the counsel designated in such notice. The following
provisions shall then apply:
(1) if in the written opinion of such counsel for the holder,
obtained at the holder's sole cost and expense and a copy of which shall be
delivered to the Company and shall be reasonably satisfactory in form,
scope and substance to the Company, the proposed transfer may be effected
without registration of such Restricted Securities under the Securities Act
or applicable state securities laws, such holder shall thereupon be
entitled to transfer such Restricted Securities in accordance with the
terms of the notice delivered by such holder to the Company. Each
Restricted Security or certificate, if any, issued upon or in connection
with such transfer shall bear an appropriate restrictive legend unless, in
the opinion of such counsel, such legend is no longer required to insure
compliance with the Securities Act and applicable state securities laws;
and
(2) if the opinion of such counsel rendered pursuant to the
foregoing subsection (1) is not to the effect that the proposed transfer
may legally be effected without registration of such Restricted Securities
under the Securities Act or applicable state securities laws (such opinion
to state the basis of the legal conclusions reached therein), such holder
shall not be entitled to transfer such Restricted Securities (other than a
transfer pursuant to Rule 144, Rule 144A or any comparable rule under the
Securities Act) until receipt by the Company of a further notice and a
further opinion of counsel for such holder to the effect stated in
subsection (1) above or until registration of such Restricted Securities
under the Securities Act and applicable state securities laws has become
effective.
5.3 Termination of Restrictions. The restrictions imposed by this Section
---------------------------
5 upon the transferability of Restricted Securities shall cease and terminate as
to any particular Restricted Securities when, in the opinion of counsel for the
Company, such restrictions are no longer required in order to ensure compliance
with the Securities Act. Whenever such restrictions shall terminate as to any
Restricted Securities, the holder thereof shall be entitled to receive from the
Company, without expense (other than transfer taxes, if any), new securities of
like tenor not bearing an applicable restrictive legend.
5
<PAGE>
6 Reservation of Stock; Regulation S Considerations. The Company will
-------------------------------------------------
at all times reserve and keep available, solely for issuance and delivery upon
the exercise of this Warrant, the number of shares of Common Stock (or Other
Securities) from time to time issuable upon the exercise of this Warrant. All
such securities shall be duly authorized and, when issued upon such exercise,
shall be validly issued and, in the case of shares, fully paid and nonassessable
with no liability on the part of the holders thereof; provided, however, that
the Company shall be under no obligation to issue any such securities unless the
holder of this Warrant presents (a) written certification that it is not a "U.S.
person" within the meaning of Regulation S or (b) a written opinion of counsel
to the effect that this Warrant and the shares of Common Stock (or Other
Securities) issuable upon exercise of this Warrant have been registered under
the Securities Act or are exempt from registration thereunder. In no event shall
this Warrant be exercised in the United States or securities be delivered within
the United States upon exercise, other than in offerings deemed to meet the
definition of "offshore transaction" pursuant to Rule 902(h) promulgated under
the Securities Act, unless this Warrant or any such security is issuable upon
its exercise has been registered under the Securities Act or an exemption from
registration is available.
7 Ownership Transfer and Substitution of Warrants.
-----------------------------------------------
7.1 Ownership of Warrants. The Company may treat the Person in whose name
---------------------
this Warrant is registered on the register kept at the principal office of the
Company as the owner and holder thereof for all purposes, notwithstanding any
notice to the contrary, except that, if and when this Warrant is properly
assigned in blank, the Company may (but shall not be obligated to) treat the
bearer thereof as the owner of such Warrant for all purposes, notwithstanding
any notice to the contrary. This Warrant, if properly assigned, may be exercised
by a new holder without first having a new Warrant issued.
7.2 Office; Transfer and Exchange. (a) The Company will maintain its
-----------------------------
principal office in Reno, Nevada or at such other location as it designates in a
written notice delivered to each registered holder of this Warrant prior to any
change of such location, and all notices, presentations and demands in respect
of this Warrant may be made upon it at such location. The Company may designate
from time to time by notice to the registered holder of this Warrant an office
or agency of the Company where such notices, presentations and demands in
respect of this Warrant may be made in lieu of the Company's principal office.
(b) Upon any surrender of this Warrant, properly endorsed, for
registration of transfer or for exchange at the principal office of the Company
or the office of the Company maintained pursuant to Section 7.2(a), the Company
at its expense will (subject to compliance with Section 5, if applicable)
execute and deliver to or upon the order of the holder thereof a new Warrant or
Warrants of like tenor, in the name of such holder or as such holder (upon
payment by such holder of any applicable transfer taxes) may direct, calling in
the aggregate on the face or faces thereof for the number of shares of Common
Stock called for on the face or faces of the Warrant or Warrants so surrendered.
7.3 Replacement of Warrants. Upon receipt of evidence reasonably
-----------------------
satisfactory to the Company of the loss, theft, destruction or mutilation of any
Warrant (which may be a written statement as to such loss, theft, destruction or
mutilation) and (a) in the case of such loss, theft or destruction of any
Warrant, upon delivery of indemnity reasonably satisfactory to the Company in
form and amount, or (b) in the case of any such mutilation, upon surrender of
6
<PAGE>
such Warrant for cancellation at the office of the Company maintained pursuant
to Section 7.2(a) or the principal office of the Company, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.
8 Definitions. As used herein, unless the context otherwise requires,
-----------
the following terms have the following respective meanings:
"Business Day" shall mean any day other than a Saturday, Sunday or any
------------
other day on which U.S. Federal Reserve member banks are not open for business
in New York, New York.
"Commission" shall mean the Securities and Exchange Commission or any
----------
other Federal agency at the time administering the Securities Act.
"Company" shall have the meaning specified in the opening paragraphs
-------
of this Warrant, including any corporation that shall succeed to or assume the
obligations of the Company hereunder in compliance with Section 2.2.
"Exchange Act" shall mean the Securities Exchange Act of 1934, or any
------------
similar Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Market Price" shall mean, per share of Common Stock that the holders
------------
of this Warrant shall be entitled to receive upon exercise hereof, on any date
specified herein, (a) the closing price per share of Common Stock on the Nasdaq
SmallCap Market or such other principal automated quotation system or national
securities exchange on which the Common Stock is then quoted or listed, as
reported in The Wall Street Journal, or (b) if (a) is inapplicable, a price per
--- ---- ------ -------
share thereof equal to the fair value thereof determined in good faith by a
resolution of the Board of Directors of the Company as of a date that is within
15 days of the date as of which the determination is to be made.
"Other Securities" shall mean any stock (other than Common Stock) and
----------------
other securities of the Company or any other Person (corporate or otherwise)
that the holder of this Warrant at any time shall be entitled to receive, or
shall have received, upon the exercise of this Warrant, in lieu of or in
addition to Common Stock, or that at any time shall be issuable or shall have
been issued in exchange for or in replacement of Common Stock or Other
Securities pursuant to Section 2 or otherwise.
"Person" shall mean a corporation, an association, a partnership, an
------
organization or business, an individual, a government or political subdivision
thereof or a governmental agency.
"Regulation S" shall mean Rules 901 through 905 promulgated under the
------------
Securities Act or any similar rules or regulations under the Securities Act, all
as the same shall be in effect at the time.
"Restricted Securities" shall mean any (a) any Warrant bearing the
---------------------
applicable legend set forth in Section 5.1, (b) any shares of Common Stock (or
Other Securities) issued upon exercise of this Warrant that are evidenced by a
certificate or certificates bearing the applicable legend set forth in such
Section or (c) any shares of Common Stock (or Other Securities) issued
subsequent to any exercise of this Warrant as a dividend or other distribution
with respect to, or resulting from a subdivision of the outstanding shares of
Common Stock (or Other
7
<PAGE>
Securities) into a greater number of shares by reclassification, stock splits or
otherwise, or in exchange for or in replacement of the Common Stock (or Other
Securities) issued upon such exercise, that are evidenced by a certificate or
certificates bearing the applicable restrictive legend.
"Securities Act" shall mean the Securities Act of 1933, or any similar
--------------
Federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect at the time.
"Warrant" shall have the meaning specified in the opening paragraphs
-------
of this Warrant.
"Warrant Price" shall have the meaning specified in the opening
-------------
paragraphs of this Warrant.
9 Remedies. The Company stipulates that the remedies at law of the
--------
holder of this Warrant in the event of any default or threatened default by the
Company in the performance of or compliance with any of the terms of this
Warrant are not and will not be adequate, and that, to the extent permitted by
applicable law, such terms may be specifically enforced by a decree for the
specific performance of any agreement contained herein or by an injunction
against a violation of any of the terms hereof or otherwise.
10 No Rights or Liabilities as Stockholder. Nothing contained in this
---------------------------------------
Warrant shall be construed as conferring upon any holder hereof any rights as a
stockholder of the Company or as imposing any obligation on such holder to
purchase any securities or as imposing any liabilities on such holder as a
stockholder of the Company, whether such obligation or liabilities are asserted
by the Company or by creditors of the Company.
11 Notices. All notices and other communications provided for herein
-------
shall be delivered or mailed by first class mail, postage prepaid, addressed (a)
if to any holder of this Warrant, at the registered address of such holder as
set forth in the register kept by the Company, or (b) if to the Company, at its
principal office, 6490 South McCarran Boulevard, Suite D-28, Reno, Nevada 89509,
or at the address of such other principal office of the Company as the Company
shall have furnished to each holder of this Warrant in writing, with a copy to
Jones, Day, Reavis & Pogue, 77 West Wacker Drive, Chicago, Illinois 60601, Attn:
Timothy J. Melton; provided, however, that the exercise of any Warrant shall be
effective in the manner provided in Section 1.
8
<PAGE>
12 Miscellaneous. This Warrant and any term hereof may be changed,
-------------
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. Any provision of this Warrant that shall be prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. To the extent permitted by applicable law, the Company
waives any provision of law that shall render any provision hereof prohibited or
unenforceable in any respect. This Warrant shall be governed by the substantive
laws of the State of Nevada without reference to the choice of law rules
thereof. The headings of this Warrant are inserted for convenience only and
shall not be deemed to constitute a part hereof.
13 Expiration. Subject to the provisions in Section 1.1 hereof and except
----------
as otherwise provided in this Section 13, the right to exercise this Warrant
shall expire at 5:00 p.m., New York City time, on the date set forth on the
first page hereof; provided, however, that if the closing price per share of
Common Stock on the Nasdaq SmallCap Market, or such other principal automated
quotation system or national securities exchange on which the Common Stock is
then quoted or listed, as reported in The Wall Street Journal, is greater than
-----------------------
$14.00 (without giving effect to any adjustments to the Common Stock that may be
required in connection with the issuances of additional, or combinations or
consolidations of the, shares of Common Stock of the type contemplated by
Section 2.1 hereof) for any 20 consecutive trading days during the term of this
Warrant, the Warrant shall expire at 5:00 p.m., New York City time, on the 30th
day following the date on which the Company notifies the holder hereof of such
occurrence.
[The remainder of this page is intentionally left blank.]
9
<PAGE>
IN WITNESS WHEREOF, the Company has caused this Warrant to be
exercised by its officer thereunto duly authorized as of the date first written
above.
HOMESEEKERS.COM INCORPORATED
By:_____________________________
Name:___________________________
Title:__________________________
10
<PAGE>
FORM OF SUBSCRIPTION
--------------------
THE EXERCISE OF THIS WARRANT IS SUBJECT TO, AND SHALL ONLY BE EFFECTIVE
UPON, SATISFACTION OF ANY CONDITIONS SET FORTH IN SECTION 6 OF THIS WARRANT AND
ANY APPLICABLE REGULATORY FILING REQUIREMENTS SUCH AS THE PREMERGER NOTIFICATION
AND REPORT FORM FILING REQUIREMENTS OF THE HART-SCOTT-RODINO ANTITRUST
IMPROVEMENTS ACT OF 1976 AND REGULATIONS PROMULGATED PURSUANT THERETO.
[To be executed only upon exercise of Warrant]
To HOMESEEKERS.COM, INCORPORATED
The undersigned registered holder of the attached Warrant hereby
irrevocably exercises such Warrant for, and purchases thereunder, __________/1/
shares of Common Stock of HOMESEEKERS.COM, INCORPORATED, and herewith makes
payment as follows (check as applicable): [_] certified or official bank check
in the amount of $_________; [_] wire transfer in the amount of $_________;
and/or [_] cancellation of _______ shares of Common Stock otherwise issuable
under the Warrant. The undersigned requests that the certificates for such
shares be issued in the name of, and delivered to ____________________________,
whose address is ____________________________________________________________.
Dated:__________________
__________________________________________________
(Signature must conform in all respects to name of
holder as specified on the face of Warrant)
__________________________________________________
(Street Address)
__________________________________________________
(City) (State) (Zip Code)
- ----------
/1/ Insert here the number of shares called for on the face of this Warrant (or
in the case of a partial exercise, the portion thereof as to which this Warrant
is being exercised), in either case without making any adjustment for additional
Common Stock or any other stock or other securities or property or cash that,
pursuant to the adjustment provisions of this Warrant, may be delivered upon
exercise. In the case of a partial exercise, a new Warrant or Warrants will be
issued and delivered, representing the unexercised portion of the Warrant, to
the holder surrendering the Warrant.
<PAGE>
Exhibit 4
October 20, 1999
Greg Costley
[ADDRESS]
Dear Greg:
The Board of Directors of HomeSeekers.com., Inc. (the "Corporation") is
pleased to award you an Option pursuant to the provisions of the 1996 Amended
and Restated Stock Option Plan (the "Plan"). This letter will describe the
option granted to you. Attached to this letter is a copy of the prospectus
which includes a copy of the plan. The terms of the Plan also set forth
provisions governing the Option granted to you. Therefore, in addition to
reading this letter you should also read the Plan. Your signature on this
letter is acknowledgement to us that you have read and understand the Plan and
that you agree to abide by its terms. All terms not defined in this letter
shall have the same meaning as the Plan.
1. Type of Option. You are granted an ISO. Please see in particular
--------------
Section 11 of the Plan.
2. Rights and Privileges. Subject to the conditions hereinafter set
---------------------
forth, we grant you the right to purchase 1500 shares of common stock ("Stock")
at $7.94 per share, the fair market value of a share of Stock on 8/23/99. The
right to purchase the shares of Stock vests quarterly over three years. This
means that you acquire the right to purchase one twelfth of the total granted
shares every three months.
3. Time of Exercise. The Option may be exercised at any time and from
----------------
time to time beginning when the right to purchase the shares of Stock accrues
and ending when they terminate as provided in Section 5 of this letter.
4. Method of Exercise. The Option shall be exercised by written notice to
------------------
the Board of Directors at the Corporation's place of business. The notice shall
set forth the number of shares of Stock to be acquired and shall contain a check
payable to the Corporation in full payment for the Stock or that number of
already owned shares of Stock equal in value to the total Exercise Price of the
Option. We shall make delivery of the shares of Stock subject to the conditions
described in Section 13 of the Plan.
<PAGE>
5. Termination of Option. To the extent not exercised, the Option shall
---------------------
terminate three years from the date each quarterly grant becomes effective
pursuant to the provisions of Section 2 of this Agreement.
6. Securities Laws. The Shares of Stock underlying the Option have been
---------------
registered with the Securities and Exchange Commission. When the shares are
exercised properly and the Corporation has been furnished with an option of
counsel satisfactory in form and substance the shares of Stock underlying the
Option can be "unrestricted securities".
However, if a satisfactory opinion of counsel is not obtained, all shares
of Stock acquired upon the exercise of the Option shall be "restricted
securities" as the term is defined in Rule 144 promulgated under the Securities
Act of 1933. The certificate representing the shares shall bear an appropriate
legend restricting their transfer.
7. Binding Effect. The right and obligations described in this letter
--------------
shall inure to the benefit of and be binding upon both of us, and our respective
heirs, personal representatives and successors.
8. Date of Grant. This Option shall be treated as having been granted to
-------------
you on 8/23/99.
Very truly yours,
By: /s/ Tierney McClary
-------------------
Tierney McClary
Controller
AGREED AND ACCEPTED:
/s/ Gregory L. Costley
- ----------------------
2
