Warrant to Purchase Shares - Onvia.com Inc. and Dominion Capital Management LLC
NEITHER THIS WARRANT NOR THE SHARES OF STOCK ISSUABLE UPON
EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED NEITHER THIS WARRANT NOR THE SHARES
OF STOCK ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. NO SALE,
TRANSFER OR OTHER DISPOSITION OF THIS WARRANT OR SAID SHARES
MAY BE EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO, (ii) AN OPINION OF COUNSEL FOR
THE HOLDER THAT SUCH REGISTRATION IS NOT REQUIRED OR (iii)
RECEIPT OF A NO-ACTION LETTER FROM THE SECURITIES AND
EXCHANGE COMMISSION TO THE EFFECT THAT REGISTRATION UNDER
THE ACT IS NOT REQUIRED.
WARRANT TO PURCHASE
SHARES OF SERIES A PREFERRED STOCK
Expires: June 15, 2008
THIS CERTIFIES THAT, for value received, DOMINION CAPITAL MANAGEMENT L.L.C.,
a Delaware limited liability company, is entitled to subscribe for and purchase
up to that number of shares (as adjusted pursuant to the provisions hereof, the
"Shares") of Series A Preferred Stock (as hereinafter defined) of ONVIA.COM,
INC., a Washington Corporation (the "Company")which, at the time of exercise of
this Warrant, is equal to $120,000 divided by the price per share (as adjusted
pursuant to the terms hereof, the "Exercise Price") as shall be determined in
accordance with Section 1.1 hereof. As used herein, the term "Grant Date" shall
mean June 15, 1999.
1. Exercise Price; Preferred Stock; Term.
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1.1 Exercise Price. The Exercise Price shall be determined as
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follows:
(a) If, prior to October 31, 1999, the Company completes a
private offering of its next authorized series of preferred stock, which next
authorized series the Company intends to designate "Series B Preferred Stock,"
the aggregate gross proceeds from which exceeds $7,000,000 (whether in one
transaction or in a series of transactions after the date of this Warrant and
excluding the conversion of debt to equity) (the "Financing"), then the Exercise
Price shall be determined based on the following formula:
Price per share: X + (A/B) x (Y-X).
Where: X = Price per share of the last round (2.34).
Y = Price per share of the next round.
A = Months from the last round (3).
B = Months between Series A and Series B closing.
(b) If the Company does not complete the Financing prior to
October 31, 1999, then the Exercise Price shall be $ 2.34.
1.2 Preferred Stock. The term "Preferred Stock" shall mean as
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follows:
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(a) If the Company completes the Financing prior to October 31,
1999, then the term "Preferred Stock" shall mean the series of the Company's
preferred stock issued in the Financing, and any stock into or for which such
preferred stock may thereafter be converted or exchanged.
(b) If the Company does not complete the Financing prior to
October 31, 1999, then the term "Preferred Stock" shall mean the Company's
presently authorized Series A Preferred Stock, and any stock into or for which
such Series A Preferred Stock may hereafter be converted or exchanged.
1.3 Term. This Warrant is exercisable, in whole or in part, at any
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time and from time to time from and after the Grant Date and prior to the
earlier of (a) the ninth anniversary of the Grant Date, (b) the fourth
anniversary of the consummation of the Company's initial public offering of its
Common Stock pursuant to a registration statement filed under the Securities Act
of 1933, as amended (the "Securities Act"), the aggregate gross proceeds from
which exceed $10,000,000 or (c) the occurrence of an event set forth in Section
10.2 below.
(i) It is understood and agreed upon the consummation of the
Company's initial public offering of its Common Stock under the terms of this
Section 1.3, that this Warrant shall simultaneously and automatically convert
into a Warrant in the same form and with all the same rights except that it
shall be a Warrant to purchase shares of Common Stock.
2. Method of Exercise; Net Issue Exercise.
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2.1 Method of Exercise; Payment; Issuance of New Warrant. This
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Warrant may be exercised by the holder hereof, in whole or in part and from time
to time, by either of the following, at the election of the holder hereof: (a)
the surrender of this Warrant (with the Notice of Exercise form attached hereto
as Exhibit A-1 duly executed) at the principal office of the Company and by the
payment to the Company, by cash, check or cancellation of indebtedness, of an
amount equal to the Exercise Price per share multiplied by the number of Shares
then being purchased; or (b) if in connection with a sale of Shares pursuant to
a registered public offering of the Company's securities, the surrender of this
Warrant (with the Notice of Exercise form attached hereto as Exhibit A-2 duly
executed), which surrender may be made contingent upon the closing of such
offering, at the principal office of the Company together with notice of
arrangements reasonably satisfactory to the Company for payment to the Company
from the proceeds of the sale of shares to be sold by the holder in such public
offering of an amount equal to the Exercise Price per share multiplied by the
number of Shares then being purchased. The person or persons in whose name(s)
any certificate(s) representing Shares shall be issuable upon exercise of this
Warrant shall be deemed to have become the holder(s) of record of, and shall be
treated for all purposes as the record holder(s) of, the Shares represented
thereby (and such Shares shall be deemed to have been issued) immediately prior
to the close of business on the date or dates upon which this Warrant is
exercised. In the event of any exercise of this Warrant, certificates for the
Shares so purchased shall be delivered to the holder hereof as soon as possible
and in any event within fifteen (15) days of receipt of such notice (or,
following, the Company's initial public offering, within five (5) days of
receipt of such notice) and, unless this Warrant has been fully exercised or
expired, a new Warrant representing the portion of the Shares, if any, with
respect to which this Warrant shall not then have been exercised shall also be
issued to the holder hereof as soon as possible thereafter.
2.2 Automatic Exercise. To the extent this Warrant is not previously
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exercised, and if the fair market value of one share of the Company's Preferred
Stock is greater than the Exercise Price then in effect, this Warrant shall be
deemed automatically exercised pursuant to Section 2.3 below (even if not
surrendered) immediately before its expiration. For purposes of such automatic
exercise, the fair market value of one share
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of the Company's Preferred Stock upon such expiration shall be determined
pursuant to Section 2.3 (b) below. To the extent this Warrant or any portion
thereof is deemed automatically exercised pursuant to this Section 2.2, the
Company agrees to promptly notify the holder hereof of the number of Shares, if
any, the holder hereof is to receive by reason of such automatic exercise.
2.3 Right to Convert Warrant into Stock: Net Issuance.
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(a) In addition to and without limiting the rights of the holder
under the terms of this Warrant, the holder may elect to convert this Warrant or
any portion thereof (the "Conversion Right") into shares of Preferred Stock, the
aggregate value of which shares shall be equal to the value of this Warrant or
the portion thereof being converted. The Conversion Right may be exercised by
the holder by surrender of this Warrant at the principal office of the Company
together with notice of the holder's intention to exercise the Conversion Right,
in which event the Company shall issue to the holder a number of shares of the
Company's Preferred Stock computed using the following formula:
X = Y (A-B)
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A
Where: X = The number of shares of Preferred Stock to be issued to the
holder.
Y = The number of shares of Preferred Stock purchasable under this
Warrant subject to the exercise election.
A = The fair market value of one share of the Company's Preferred
Stock.
B = Exercise Price (as adjusted to the date of such calculations).
(b) For purposes of this Section 2.3, the "fair market value"
per share of the Company's Preferred Stock shall mean:
(i) If the Conversion Right is exercised in connection with
and contingent upon the Company's initial public offering, and if the Company's
registration statement relating to such offering has been declared effective by
the Securities and Exchange Commission, then the initial "Price to Public"
specified in the final prospectus with respect to such offering; or
(ii) If the Conversion Right is not exercised in connection
with and contingent upon the Company's initial public offering, then as follows:
(A) If the Preferred Stock is traded on a national securities
exchange or admitted to unlisted trading privileges on such an exchange, or
is listed on the Nasdaq National Market (the "National Market System"), the
fair market value shall be the average of the last reported sale prices of
the Preferred Stock on such exchange or on the Nasdaq National Market on the
last ten (10) trading days (or all such trading days such Preferred Stock
has been traded if fewer than 10 trading days) before the effective date of
exercise of the Conversion Right or if no such sale is
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made on any such day, the mean of the closing bid and asked prices for such
day on such exchange or on the Nasdaq National Market;
(B) If the Preferred Stock is not so listed or admitted to
unlisted trading privileges, the fair market value shall be the average of
the means of the last bid and asked prices reported on the last ten (10)
trading days (or all such trading days such Preferred Stock has been traded
if fewer than 10 trading days) before the date of the election (1) by the
Nasdaq Stock Market or (2) if reports are unavailable under clause (1)
above, by the National Quotation Bureau Incorporated; and
(C) If the Preferred Stock is not so listed or admitted to
unlisted trading privileges and bid and ask prices are not reported, the
fair market value shall be the price per share which the Company could
obtain from a willing buyer for shares sold by the Company from authorized
but unissued shares, as such price shall be determined by mutual agreement
of the Company and the holder of this Warrant.
3. Stock Fully Paid; Reservation of Shares. All Shares that may be issued
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upon the exercise of this Warrant, and all Common Stock issuable upon conversion
of the Shares shall, upon issuance, be validly issued, fully paid and
nonassessable, and free from all taxes, liens and charges with respect to the
issue thereof. During the period within which this Warrant may be exercised,
the Company will at all times have duly authorized and reserved, for the purpose
of issuance upon exercise of this Warrant, a sufficient number of shares of
Preferred Stock (and Common Stock issuable upon conversion thereof).
4. Adjustments to Exercise Price and Number of Shares. The number and
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kind of securities purchasable upon the exercise of this Warrant and the
Exercise Price shall be subject to adjustment from time to time as set forth in
that certain Amended and Restated Articles of Incorporation of the Company,
dated February, 23, 1999, (the "Articles of Incorporation"), and in Appendix I
hereto upon the occurrence of certain events described therein. The provisions
of the Articles of Incorporation, and Appendix I are incorporated by reference
herein with the same effect as if set forth in full herein.
5. Notices of Record Date. In the event of any taking by the Company of a
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record of its shareholders for the purpose of determining shareholders who are
entitled to receive payment of any dividend or other distribution, any right to
subscribe for, purchase or otherwise acquire any share of any class or any other
securities or property, or to receive any other right, or for the purpose of
determining shareholders who are entitled to vote in connection with any
proposed merger or consolidation of the Company with or into any other
corporation, or any proposed sale, lease or conveyance of all or substantially
all of the assets of the Company, or any proposed liquidation, dissolution or
winding up of the Company, then, in connection with each such event, the Company
shall mail to the holder of this Warrant at least twenty (20) days prior written
notice of the date on which any such record is to be taken for the purpose of
such dividend, distribution, right(s) or vote of the shareholders. Each such
written notice shall specify the amount and character of any such dividend,
distribution or right(s), and shall set forth, in reasonable detail, the matter
requiring any such vote of the shareholders.
6. Fractional Shares. No fractional shares of Preferred Stock will be
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issued in connection with any exercise hereunder, but in lieu of such fractional
shares the Company shall make a cash payment therefor based upon the per share
fair market value of the Preferred Stock on the date of exercise.
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7. Compliance with Securities Act; Disposition of Warrant or Shares of
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Preferred Stock.
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(a) Compliance with Securities Act. The holder of this Warrant, by
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acceptance hereof, agrees that this Warrant, the Shares to be issued upon
exercise hereof and the Common Stock to be issued upon conversion of such Shares
are being acquired for investment and that such holder will not offer, sell or
otherwise dispose of this Warrant or any Shares to be issued upon exercise
hereof (or Common Stock issued upon conversion of such Shares) except under
circumstances which will not result in a violation of the Securities Act. This
Warrant and all Shares issued upon exercise of this Warrant (unless registered
under the Securities Act) shall be stamped or imprinted with a legend in
substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. NO SALE OR DISPOSITION MAY BE
EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO, (ii) AN OPINION OF COUNSEL FOR THE HOLDER
THAT SUCH REGISTRATION IS NOT REQUIRED OR (iii) RECEIPT OF A
NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION
TO THE EFFECT THAT REGISTRATION UNDER THE ACT IS NOT REQUIRED.
(b) Disposition of Warrant and Shares. With respect to any offer,
---------------------------------
sale or other disposition of this Warrant or any Shares acquired pursuant to the
exercise of this Warrant (or Common Stock issued upon conversion of such Shares)
prior to registration thereof, the holder hereof and each subsequent holder of
this Warrant agrees to give written notice to the Company prior thereto,
describing briefly the manner thereof, together with a written opinion of such
holder's counsel, if reasonably requested by the Company, to the effect that
such offer, sale or other disposition may be effected without registration or
qualification (under the Securities Act as then in effect or any federal or
state law then in effect) of this Warrant or such Shares or Common Stock and
indicating whether or not under the Securities Act certificates for this Warrant
or such Shares or Common Stock to be sold or otherwise disposed of require any
restrictive legend as to applicable restrictions on transferability in order to
insure compliance with the Securities Act. Each certificate representing this
Warrant or the Shares or Common Stock thus transferred (except a transfer
pursuant to Rule 144) shall bear a legend as to the applicable restrictions on
transferability in order to insure compliance with the Securities Act unless, in
the aforesaid opinion of counsel for the holder, such legend is not required in
order to insure compliance with the Securities Act. Nothing herein shall
restrict the transfer of this Warrant or any portion hereof by the initial
holder hereof to any partnership affiliated with the initial holder, or to any
partner of any such partnership provided such transfer may be made in compliance
with applicable federal and state securities laws. The Company may issue stop
transfer instructions to its transfer agent in connection with the foregoing
restrictions.
8. Rights as Shareholders; Information.
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8.1 Shareholder Rights. Except as set forth herein, no holder of this
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Warrant, as such, shall be entitled to vote upon any matter submitted to
shareholders at any meeting thereof, or to receive notice of meetings, or be
deemed the holder of Preferred Stock until this Warrant shall have been
exercised and the Shares purchasable upon such exercise shall have become
deliverable, as provided herein.
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8.2 Financial Statements and Information. The Company shall deliver
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to the registered holder hereof (i) within one-hundred-twenty (120) days after
the end of the fiscal year of the Company, a consolidated balance sheet of the
Company as of the end of such year and a consolidated statement of income, cash
flows and shareholders' equity for such year, which year-end financial reports
shall be in reasonable detail and certified by independent public accountants of
nationally recognized standing selected by the Company, and (ii) within forty-
five (45) days after the end of each fiscal quarter (other than the last fiscal
quarter), unaudited consolidated statements of income and cash flows for such
quarter and a consolidated balance sheet as of the end of such quarter,
certified by the Company's chief financial officer. In addition, the Company
shall deliver to the registered holder hereof any other information or data
provided generally to the shareholders of the Company. The registered holder
hereby acknowledges and agrees that all information delivered in this section 8
shall be held strictly confidential, except to the extent any disclosure of such
information is required by auditors, lenders, or a court of competent
jurisdiction or governmental authority. The registered holder agrees to sue its
commercially reasonable efforts to bind those third parties to whom confidential
information is disclosed to the terms of this Section 8.
9. Registration Rights. The rights of the holder of this Warrant and the
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obligations of the Company with respect to registration under the Securities Act
and the applicable rules and regulations thereunder shall be as set forth in
that certain Investor Rights Agreement dated February 23, 1999, between the
Company and the parties who have executed the counterpart signature pages
thereto or are otherwise bound thereby (the "Investor Rights Agreement"), the
provisions of which are incorporated by reference herein with the same effect as
if set forth in full herein.
10. Additional Rights.
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10.1 Mergers. The Company agrees to provide the holder of this Warrant
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with at least twenty (20) days' prior written notice of the terms and
conditions of any proposed transaction, in which the Company would (i) sell,
lease, exchange, convey or otherwise dispose of all or substantially all of its
property or business, or (ii) merge into or consolidate with any other
corporation (other than a wholly-owned subsidiary of the Company), or effect any
transaction (including a merger or other reorganization) or series of related
transactions, in which more than fifty percent (50%) of the voting power of the
Company is disposed of. The Company will cooperate with the holder in arranging
the sale of this Warrant in connection with any such transaction.
11. Representations and Warranties. This Warrant is issued and delivered
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on the basis of the following:
(a) This Warrant has been duly authorized, executed and delivered by
the Company and constitutes the valid and binding obligation of the Company,
enforceable in accordance with its terms;
(b) The Shares have been duly authorized and reserved for issuance by
the Company and, when issued in accordance with the terms hereof, will be
validly issued, fully paid and nonassessable;
(c) The rights, preferences, privileges and restrictions granted to
or imposed upon the Shares and the holders thereof are as set forth in the
Company's Articles of Incorporation, as amended (the "Charter"), a true and
complete copy of which has been delivered to the original holder of this
Warrant;
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(d) The shares of Common Stock issuable upon conversion of the Shares
have been duly authorized and reserved and, when issued in accordance with the
terms of the Company's Charter, will be validly issued, fully paid and
nonassessable;
(e) As of the Grant Date, the capitalization of the Company shall be
as set forth in the Capitalization Schedule attached hereto as Appendix IV,
which indicates the following: (i) the authorized capital stock of the Company
(including the authorized number of shares of Common Stock and each series of
Preferred Stock); (ii) the number of shares of Common Stock and each series of
Preferred Stock issued and outstanding; (iii) the number of shares of Common
Stock reserved for issuance upon conversion of any Preferred Stock; (iv) the
number of shares for which options have been granted under the Company's Stock
Option Plan; and (v) any other securities that are convertible into or
exchangeable for Common Stock or options to purchase or rights to subscribe for
Common Stock or such convertible or exchangeable securities, and the number of
shares of Common Stock issuable upon any conversion, exchange or exercise of
such securities, options or rights. All issued and outstanding shares of the
Company's Common Stock and Preferred Stock have been duly authorized and validly
issued, and are fully paid and nonassessable. Except as set forth in Appendix
IV, there are no outstanding rights, options, warrants, conversion rights,
preemptive rights, rights of first refusal or similar rights for or
understandings relating to the purchase or acquisition from the Company of any
securities of the Company.
(f) The execution and delivery of this Warrant, the issuance of the
Shares upon exercise of this Warrant in accordance with the terms hereof and the
compliance by the Company with the provisions hereof (i) are not and will not be
inconsistent with the Company's Charter or Bylaws, (ii) do not and will not
contravene any law, governmental rule or regulation, judgment or order
applicable to the Company, and (iii) do not and will not contravene any
provision of, or constitute a default under, any indenture, mortgage, contract
or other instrument of which the Company is a party or by which it is bound or
require the consent or approval of, the giving of notice to, the registration
with or the taking of any action in respect of or by, any Federal, state or
local government authority or agency or other person.
12. Amendment of Conversion Rights. The Company shall promptly provide
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the holder of this Warrant with any restatement, amendment, modification or
waiver of the Charter promptly after the same has been made.
13. Modification and Waiver. This Warrant and any provision hereof may be
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changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of the same is sought.
14. Notices. Any notice, request or other document required or permitted
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to be given or delivered to the holder hereof or the Company shall be delivered
or sent to each such holder at its address as shown on the books of the Company
or to the Company at the address indicated therefor on the signature page of
this Warrant and shall be deemed received by the holder upon the earlier of
actual receipt or, if sent by certified mail (postage pre-paid), five (5) days
after deposit in the U.S. mail.
15. Binding Effect on Successors. This Warrant shall be binding upon any
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corporation succeeding the Company by merger, consolidation or acquisition of
all or substantially all of the Company's assets. All of the obligations of the
Company relating to the Shares, or the Company's Common Stock issuable upon
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conversion thereof, shall survive the exercise and termination of this Warrant.
All of the covenants and agreements of the Company shall inure to the benefit of
the successors and assigns of the holder hereof. The Company will, at the time
of the exercise of this Warrant, in whole or in part, upon request of the holder
hereof but at the Company's expense, acknowledge in writing its continuing
obligation to the holder hereof in respect of any rights (including, without
limitation, any right to registration of the Shares in accordance with Appendix
II) to which the holder hereof shall continue to be entitled after such exercise
in accordance with this Warrant; provided, that the failure of the holder hereof
to make any such request shall not affect the continuing obligation of the
Company to the holder hereof in respect of such rights.
16. Lost Warrants or Stock Certificates. The Company covenants to the
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holder hereof that upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction, or mutilation of this Warrant or any
stock certificate issued upon exercise thereof and, in the case of any such
loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory
to the Company, or in the case of any such mutilation upon surrender and
cancellation of such Warrant or stock certificate, the Company shall make and
deliver a new Warrant or stock certificate, or like tenor, in lieu of the lost,
stolen, destroyed or mutilated Warrant or stock certificate.
17. No Impairment. The Company will not, by amendment of its Charter or
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through any reorganization, recapitalization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other 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, but will at all times in good
faith assist in the carrying out of all the provisions of this Warrant 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.
18. Descriptive Headings. The descriptive headings of the several
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paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant.
19. Recovery of Litigation Costs. If any legal action or other proceeding
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is brought for the enforcement of this Warrant, or because of an alleged
dispute, breach, default, or misrepresentation in connection with any of the
provisions of this Warrant, the successful or prevailing party or parties shall
be entitled to recover reasonable attorneys' fees and other costs incurred in
that action or proceeding, in addition to any other relief to which it or they
may be entitled.
20. "Market Standoff" Agreement. Each Holder hereby agrees that, during
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the period of duration (up to, but not exceeding, one hundred eighty (180) days)
specified by the Company and an underwriter of Common Stock or other securities
of the Company, following the effective date of a registration statement of the
Company filed under the Securities Act, it shall not, to the extent requested by
the Company and such underwriter, directly or indirectly sell, offer to sell,
contract to sell (including, without limitation, any short sale), grant any
option to purchase or otherwise transfer or dispose of (other than to donees who
agree to be similarly bound) any securities of the Company held by it at any
time during such period except Common Stock included in such registration;
provided, however, that:
(a) such agreement shall be applicable only the first such
registration statement of the Company which covers Common Stock (or other
securities) to be sold on its behalf to the public in an underwritten offering;
and
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(b) all officers and directors of the Company, all one-percent
securityholders, and all other persons with registration rights (whether or not
pursuant to this Agreement) enter into similar agreements.
In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registrable Securities of each
Holder (and the shares or securities of every other person subject to the
foregoing restriction) until the end of such period, and each Holder agrees
that, if so requested, such Holder will execute an agreement in the form
provided by the underwriter containing terms which are essentially consistent
with the provisions of this Section 1.14.
Notwithstanding the foregoing, the obligations described in this Section 1.14
shall not apply to a registration relating solely to employee benefit plans on
Form S-1 or Form S-8 or similar forms which may be promulgated in the future, or
a registration relating solely to an SEC Rule 145 transaction on Form S-4 or
similar forms which may be promulgated in the future.
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21. Governing Law. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN
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ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF
THE STATE OF CALIFORNIA.
Date: June 15, 1999 ONVIA.COM, INC.
a Washington corporation
By: /s/ Mark Calvert
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Name: Mark Calvert
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Title: CFO
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Address: 209 1/2 1st Ave S.
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Suite 302
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Seattle, WA 98104
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EXHIBIT A-1
NOTICE OF EXERCISE
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To: ONVIA.COM, INC.
(Company Name)
1. The undersigned hereby:
[_] elects to purchase __________ shares of Series A Preferred Stock
of the Company pursuant to the terms of the attached Warrant, and
tenders herewith payment of the purchase price of such shares in
full; or
[_] elects to exercise its net issuance rights pursuant to Section
2.3 of the attached Warrant with respect to __________ shares of
Series A Preferred Stock.
2. Please issue a certificate or certificates representing said shares in
the name of the undersigned or in such other name or names as are specified
below:
________________________________________
(Name)
________________________________________
(Address)
________________________________________
(Address)
3. The undersigned represents that the aforesaid shares being acquired
for the account of the undersigned for investment and not with a view to, or for
resale in connection with, the distribution thereof and that the undersigned has
no present intention of distributing or reselling such shares.
_______________
(Date)
__________________________________________________
(Signature)
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EXHIBIT A-2
NOTICE OF EXERCISE
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To: ONVIA.COM, INC.
(Company Name)
1. Contingent upon and effective immediately prior to the closing (the
"Closing") of the Company's public offering contemplated by the Registration
Statement on Form S-___, filed on ____________, 19___, the undersigned hereby:
[_] elects to purchase __________ shares of Series A Preferred Stock
of the Company (or such lesser number of shares as may be sold on
behalf of the undersigned at the Closing) pursuant to the terms
of the attached Warrant; or
[_] elects to exercise its net issuance rights pursuant to Section
2.3 of the attached Warrant with respect to __________ shares of
Series A Preferred Stock.
2. Please deliver to the custodian for the selling shareholders a stock
certificate representing such __________ shares.
3. The undersigned has instructed the custodian for the selling
shareholders to deliver to the Company $__________ or, if less, the net proceeds
due the undersigned from the sale of shares in the aforesaid public offering. If
such net proceeds are less than the purchase price for such shares, the
undersigned agrees to deliver the difference to the Company prior to the
Closing.
_______________
(Date)
__________________________________________________
(Signature)
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APPENDIX I
ADJUSTMENT PROVISIONS
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1. Reclassification or Merger. In case of any reclassification, change or
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conversion of securities of the class issuable upon exercise of this Warrant
(other than a change in par value, or from par value to no par value, or from no
par value to par value, or as a result of a subdivision or combination), or in
case of any merger of the Company with or into another corporation or entity
(other than a merger with another corporation in which the Company is a
continuing corporation and which does not result in any reclassification or
change of outstanding securities issuable upon exercise of this Warrant), or in
case of any sale of all or substantially all of the assets of the Company, the
Company, or such successor or purchasing corporation or entity, as the case may
be, shall execute a new Warrant (in form and substance satisfactory to the
holder of this Warrant) providing that the holder of this Warrant shall have the
right to exercise such new Warrant and upon such exercise to receive, in lieu of
each share of Preferred Stock theretofore issuable upon exercise of this
Warrant, the kind and amount of shares of stock, other securities, money and
property receivable upon such reclassification, change or merger by a holder of
one share of Preferred Stock. Such new Warrant shall provide for adjustments
that shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Appendix I. The provisions of this Section 3 shall
similarly apply to successive reclassifications, changes, mergers and transfers.
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APPENDIX II
CAPITALIZATION SCHEDULE
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