Common Stock Purchase Warrant - ScreamingMedia Inc. and 601 West Associates LLC
NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF
THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE REGISTERED HOLDER
OF THIS WARRANT HAS AGREED THAT NO SALE, PLEDGE OR OTHER TRANSFER OF THIS
WARRANT OR ANY OF SAID SHARES MAY BE MADE WITHOUT REGISTRATION UNDER SAID ACT
AND ANY APPLICABLE STATE SECURITIES LAW, UNLESS THE HOLDER SHALL DELIVER TO THE
ISSUER AN OPINION (IN FORM SATISFACTORY TO THE ISSUER) OF COUNSEL SATISFACTORY
TO THE ISSUER THAT NO SUCH REGISTRATION IS REQUIRED.
SCREAMINGMEDIA INC.
COMMON STOCK PURCHASE WARRANT
Warrant No. 4 100,000 Shares
Subject to Adjustment in the Manner
Described Below
This certifies that, for value received,
601 WEST ASSOCIATES, LLC
or its assigns, are entitled, subject to the terms and conditions hereinafter
set forth, at or before 5:00 p.m., New York time, on July 13, 2003, but not
thereafter, to purchase up to 100,000 shares (the Shares) of Common Stock, par
value $.01 per share (Common Stock), of ScreamingMedia Inc., a Delaware
corporation (the Company). The purchase price payable upon the exercise of this
Warrant shall initially be $10.00 per share, said amount being subject to
adjustment as described herein (the Warrant Price).
Upon delivery of this Warrant with the Purchase Form attached hereto duly
executed, together with payment of the Warrant Price for the shares of Common
Stock thereby purchased, at the principal office of the Company (which is
located at the Company's address as set forth in Section 10) or at such other
address as the Company may designate by notice in writing to the registered
holder hereof (the Holder), the Holder shall be entitled to receive a
certificate or certificates for the Shares so purchased. All Shares issued upon
the exercise of this Warrant will, upon issuance, be fully paid and
nonassessable and free from all taxes, liens and charges with respect thereto.
This Warrant is subject to the following terms and conditions:
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SECTION 1. TRANSFERABILITY AND FORM OF WARRANT
1.1. Registration. This Warrant is numbered and registered on the books of
the Company. The Company shall be entitled to treat the Holder as the sole owner
of this Warrant for all purposes and, unless the provisions of Section 1.2 shall
be complied with, shall not be bound to recognize any equitable or other claim
to or interest in this Warrant on the part of any other person, and shall not be
liable for any registration of transfer of this Warrant which is to be
registered in the name of a fiduciary or the nominee of a fiduciary unless made
with actual knowledge that a fiduciary or nominee is committing a breach of
trust in requesting such registration of transfer.
1.2. Transfer. Neither this Warrant nor any securities purchased upon
exercise of this Warrant may be transferred unless (i) such transfer is
registered under the Securities Act and any applicable state securities or blue
sky laws, (ii) an opinion of counsel, satisfactory to the Company, to the effect
that the transfer is exempt from the prospectus delivery and registration
requirements of the Securities Act and any applicable state securities or blue
sky laws has been delivered to the Company, or (iii) the Company otherwise
satisfies itself that such transfer is exempt from registration. This Warrant,
any replacement hereof and any certificate representing a security issued
pursuant to the exercise hereof, shall bear a legend substantially to the
foregoing effect.
SECTION 2. EXCHANGE OF WARRANT CERTIFICATE
This Warrant certificate may be exchanged for another certificate or
certificates entitling the Holder to purchase a like aggregate number of Shares
as this certificate then entitles the Holder to purchase. Any Holder of this
Warrant desiring to exchange this Warrant certificate shall make such request in
writing delivered to the Company, and shall surrender this certificate, properly
endorsed, to the Company. Thereupon, the Company shall execute and deliver to
the person entitled thereto a new Warrant certificate or certificates, as the
case may be, as so requested.
SECTION 3. TERM OF WARRANT; EXERCISE OF WARRANT
Subject to the terms of this Warrant, the Holder shall have the right, at
any time during the period commencing at 9:00 a.m., New York time, on the date
hereof, until 5:00 p.m., New York time, on June 13, 2003 (the "Termination
Date"), to purchase from the Company the number of fully paid and nonassessable
Shares to which the Holder may at the time be entitled to purchase pursuant to
this Warrant, upon surrender, to the Company at this principal office, of this
Warrant certificate, together with the Purchase Form attached hereto duly
completed and signed, and upon payment to the Company of the Warrant Price for
the number of Shares in respect of which this Warrant is then being exercised.
Payment of the aggregate Warrant Price shall be made in cash, by certified or
cashier's check, or by wire transfer, or a combination thereof.
Upon surrender of this Warrant and payment of the Warrant Price as
aforesaid, the Company shall issue and cause to be delivered with all reasonable
dispatch, to or upon the written order of the Holder and (subject to the
restrictive legend on the first page of this Warrant) in such name or names
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as the Holder may designate, a certificate or certificates for the number of
full Shares so purchased upon the exercise of this Warrant, together with cash,
as provided in Section 8 hereof, in respect of any fractional Shares 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 Shares as of the date of the
surrender of this Warrant and payment of the Warrant Price as aforesaid;
provided that if, at the date of surrender of this Warrant and payment of such
Warrant Price, the transfer books for the Shares or other class of stock
purchasable upon the exercise of this Warrant shall be closed, the certificates
for the Shares in respect of which this Warrant is then exercised shall be
issuable as of the date on which such books shall next be opened (whether
before or after the Termination Date) and until such date the Company shall be
under no duty to deliver any certificate for such Shares; and provided further
that the transfer books of record, 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 this Warrant shall be exercisable, at the election of
the Holder, either in full or from time to time in part and, in the event that
this Warrant is exercised in respect of fewer than all of the Shares at any time
prior to the date of expiration of this Warrant, a new Warrant certificate to
purchase the remaining Shares will be issued.
SECTION 4. PAYMENT OF TAXES
The Company will pay all documentary stamp taxes, if any, attributable to
the initial issuance of Shares upon the exercise of this Warrant; provided that
the Company shall not be required to pay any tax or taxes which may be payable
in respect of any transfer involved in such issuance.
SECTION 5. MUTILATED OR MISSING WARRANT
In case the certificate evidencing this Warrant shall be mutilated, lost,
stolen or destroyed, the Company may, in its discretion, issue and deliver in
exchange and substitution for and upon cancellation of this certificate if it is
mutilated, or in lieu of and substitution for this certificate if it is lost,
stolen or destroyed, a new Warrant certificate of like tenor and representing an
equivalent right or interest, but only upon receipt of evidence satisfactory to
the Company of such loss, theft or destruction of this Warrant and indemnity, if
requested, also satisfactory to the Company. Applicants for such substitute
Warrant certificate shall also comply with such other reasonable regulations and
pay such other reasonable charges as the Company may prescribe.
SECTION 6. RESERVATION OF SHARES
There have 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
this Warrant. Any transfer agent for the Common Stock or for any other shares of
the Company's capital stock issuable upon the exercise of any of the rights of
purchase aforesaid 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 photocopy of this Warrant on file with any transfer
agent for the Common Stock or for any shares of
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the Company's capital stock issuable upon the exercise of the rights of purchase
represented by this Warrant.
SECTION 7. ADJUSTMENT OF WARRANT PRICE AND NUMBER OF SHARES
7.1 Adjustments. The Warrant Price and the number and kind of securities
purchasable upon the exercise of this Warrant shall be subject to adjustment
from time to time upon the happening of certain events, as follows:
(a) In case the Company shall (i) pay a dividend in shares of Common Stock
or make a distribution in shares of Common Stock, (ii) subdivide its outstanding
shares of Common Stock, (iii) combine its outstanding shares of Common Stock
into a smaller number of shares of Common Stock or (iv) issue by
reclassification of its shares of Common Stock other securities of the Company,
the number of Shares purchasable upon exercise of this Warrant immediately prior
thereto shall be adjusted so that the Holder of this Warrant shall be entitled
to receive the kind and number of Shares or other securities of the Company
which he would have owned or have been entitled to receive after the happening
of any of such event or any record date with respect thereto. An adjustment made
pursuant to this paragraph (a) shall become effective immediately after the
effective date of such event retroactive to the record date, if any, for such
event.
(b) No adjustment in the number of shares purchasable hereunder shall be
required unless such adjustment would require an increase or decrease of at
least 1 percent in the number of Shares purchasable upon the exercise of this
Warrant; provided that any adjustments which by reason of this paragraph (b) are
not required to be made shall be carried forward and taken into account in any
subsequent adjustment.
(c) Whenever the number of Shares purchasable upon the exercise of this
Warrant is adjusted as herein provided, the Warrant Price per Share payable upon
exercise of this Warrant shall be adjusted by multiplying such Warrant Price
immediately prior to such adjustment by a fraction, of which the numerator shall
be the number of Shares purchasable upon the exercise of this Warrant
immediately prior to such adjustment, and of which the denominator shall be the
number of Shares so purchasable immediately thereafter.
(d) For the purpose of this subsection, the term "shares of Common Stock"
shall mean (i) the class of stock designated as the Common Stock of the Company
on the date of this Warrant, 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. In the event that at any time, as a result of an adjustment made
pursuant to this subsection 7.1, the Holder shall become entitled to purchase
any shares of the Company other than shares of Common Stock, thereafter the
number of such other shares so purchasable upon exercise of this Warrant, and
the Warrant Price of such shares, shall be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Shares contained in paragraphs (a) through (c),
inclusive, above, and the provisions of Section 3 and subsection 7.2 with
respect to the shares shall apply on like terms to any such other shares.
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7.2 No Adjustment for Dividends. Except as provided in subsection 7.1, no
adjustment in respect of any dividends shall be made during the term of this
Warrant or upon the exercise of this Warrant.
7.3 Lock Up. In connection with the Company's initial public offering,
warrant holder agrees not to sell or to offer to sell any securities of the
Company for 180 days following the closing of the initial public offering
except with the written consent of the Company or its underwriters and to
execute the lock-up agreement attached hereto as Exhibit A.
SECTION 8. FRACTIONAL INTERESTS
The Company shall not be required to issue fractional Shares on the
exercise of this Warrant. If more than one of the Warrants shall be presented
for exercise in full at the same time by the same Holder, the number of full
Shares which shall be issuable upon the exercise thereof shall be computed on
the basis of the aggregate number of Shares represented by this Warrant and the
other Warrants so presented. If any fraction of a Share would, except for the
provisions of this Section 8, be issuable on the exercise of this Warrant (or
specified portion thereof), the Company shall pay an amount in cash equal to
the Current Market Price per Share (as defined below) multiplied by such
fraction.
For the purposes of this Warrant, the Current Market Price per share of
Common Stock of the Company at any date shall be deemed to be (i) if the shares
of Common Stock are traded in the over-the-counter market and not on any
national securities exchange and not in the NASDAQ National Market System, the
average of the mean between the bid and asked price per share, as reported by
The National Quotation Bureau, Incorporated, or an equivalent generally
accepted reporting service, for the twenty (20) consecutive trading days
immediately preceding the date for which the determination of Current Market
Price is to be made, or, (ii) if the shares of Common Stock are traded on a
national securities exchange or in the NASDAQ National Market System, the
average daily per share closing price on the principal national securities
exchange on which they are so listed or in the NASDAQ National Market System,
as the case may be, for the twenty (20) consecutive trading days immediately
preceding the date for which the determination of Current Market Price is to be
made. The closing price referred to in clause (ii) above shall be the last
reported sales price or, in case no such reported sale takes place on such day,
the average of the reported closing bid and asked prices, in either case on the
principal national securities exchange on which the shares of Common Stock are
then listed or in the NASDAQ National Market System. If the Current Market
Price cannot be determined in accordance with the foregoing, it shall be the
fair market value per share of Common Stock as determined in good faith by the
Company's Board of Directors.
SECTION 9. NO RIGHT AS STOCKHOLDERS; NOTICES TO HOLDER
Nothing contained in this Warrant shall be construed as conferring upon
the Holder or the Holder's transferees the right to vote or to receive
dividends or to consent or to receive notice as
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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. If, however, at any time prior to the expiration
of this Warrant and prior to its exercise, any of the following events shall
occur:
(a) any action which would require an adjustment pursuant to subsection
7.1, or
(b) a dissolution, liquidation, or winding up of the Company (other than
in connection with a consolidation, merger, or sale of all or
substantially all of its property, assets, and business as an
entirety) shall be proposed;
the Company shall in each such case give notice in writing of such event to the
Holders as provided herein. Failure to publish or mail such notice or any defect
therein or in the publication or mailing thereof shall not affect the validity
of any action taken in connection with such dividend, distribution, or
subscription rights or proposed dissolution, liquidation or winding up.
SECTION 10. NOTICES
(a) Any notice to the Company pursuant to this Warrant shall be in writing
and shall be deemed to have been duly given if delivered or mailed certified
mail, return receipt requested, to the Company at 601 West 26th Street, 13th
Floor, New York, New York 10001, Attention: Chief Financial Officer. The
Company may from time to time change the address to which such notices are to
be delivered or mailed hereunder by notice to the Holder in accordance with
paragraph (b) below.
(b) Any notice pursuant to this Warrant by the Company to the Holder shall
be in writing and shall be deemed to have been duly given if mailed, postage
prepaid, to the Holder at the Holder's address on the books of the Company.
SECTION 11. SUPPLEMENTS AND AMENDMENTS
The Company may from time to time supplement or amend this Warrant, without
the approval of the 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 provisions herein, or to make any other provisions in regard to
matters or questions arising hereunder which the Company may deem necessary or
desirable and which shall not be inconsistent with the provisions of this
Warrant and which shall not adversely affect the interest of the Holder. Only a
written instrument executed by the Company and the Holder may make any other
amendment to this Warrant.
SECTION 12. SUCCESSORS
All the covenants and provisions of this Warrant by or for the benefit of
the Company or the Holder shall bind and inure to the benefit of their
respective successors and assigns hereunder.
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SECTION 13. APPLICABLE LAW
THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE
RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK,
WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
SECTION 14. INVESTMENT INTENT
By accepting this Warrant, the Holder represents that it is acquiring this
Warrant for investment and not with a view to, or for sale in connection with,
any distribution thereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by the
officer named below and its corporate seal to be affixed thereto.
Date: July 14, 2000
SCREAMINGMEDIA INC.
By: /s/ David Obstler
______________________________
Name: David Obstler
Title: Chief Financial Officer
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SCREAMINGMEDIA INC.
COMMON STOCK PURCHASE WARRANT
PURCHASE FORM
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant Certificate for, and to purchase
thereunder, _________ shares (the Shares) provided for therein, and requests
that certificates for the Shares be issued in the name of:
(Please Print or Type Name, Address and Social Security Number)
and, if said number of Shares shall not be all the Shares purchasable
hereunder, that a new Warrant Certificate for the balance of the unpurchased
Shares be registered in the name of the undersigned Warrant holder as below
indicated and delivered to the address stated below:
(Please Print)
Dated:
Name of Warrant holder:
Address:
Signature:
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 whatever.
Signature Guaranteed:
(Signature must be guaranteed by a bank or trust company having an office or
correspondent in the United States or by a member firm of a registered
securities exchange or the National Association of Securities Dealers, Inc.)
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EXHIBIT A
FORM OF LOCK-UP
July 14, 2000
ScreamingMedia Inc.
601 West 26th Street
13th Floor
New York, NY 10001
Credit Suisse First Boston Corporation
Deutsche Bank Securities Inc.
Thomas Weisel Partners LLC
c/o Credit Suisse First Boston Corporation
11 Madison Avenue
New York, NY 10010
Dear Sirs:
As an inducement to the Underwriters to execute the Underwriting
Agreement, pursuant to which an offering will be made that is intended to
result in the establishment of a public market for the Common Stock, par value
$0.01 per share (the "Securities"), of ScreamingMedia Inc., a Delaware
corporation (the "Company"), the undersigned hereby agrees that from the date
hereof and until 180 days after the public offering date set forth on the final
prospectus used to sell the Securities (the "Public Offering Date") pursuant to
the Underwriting Agreement, to which you are or expect to become parties, the
undersigned will not offer, sell, contract to sell, pledge or otherwise dispose
of, directly or indirectly, any shares of Securities or securities convertible
into or exchangeable or exercisable for any shares of Securities, enter into a
transaction which would have the same effect, or enter into any swap, hedge or
other arrangement that transfers, in whole or in part, any of the economic
consequences of ownership of the Securities, whether any such aforementioned
transaction is to be settled by delivery of the Securities or such other
securities, in cash or otherwise, or publicly disclose the intention to make
any such offer, sale pledge or disposition, or to enter into any such
transaction, swap, hedge or other arrangement, without, in each case, the prior
written consent of Credit Suisse First Boston Corporation.
Any Securities received upon exercise of options granted to, or warrants
held by, the undersigned will also be subject to this Agreement. Any Securities
acquired by the undersigned in the open market will not be subject to this
Agreement. A transfer of Securities to a family member or trust may be made,
provided the transferee agrees to be bound in writing by the terms of this
Agreement.
In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby
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authorized to decline to make any transfer of shares of Securities if such
transfer would constitute a violation or breach of this Agreement.
This Agreement shall be binding on the undersigned and the successors,
heirs, personal representatives and assigns of the undersigned. This Agreement
shall lapse and become null and void if the Public Offering Date shall not have
occurred on or before the date that is 180 days after the date of this
Agreement.
Very truly yours,
601 West Associates LLC
___________________________
Name:______________________
Title: ____________________
Date: _____________________