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EXHIBIT 10.1
THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY APPLICABLE
STATE SECURITIES LAW, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW
TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR
DISPOSITION MAY BE EFFECTED WITHOUT (a) AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO OR (b) AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
No. UL-2 Number of Shares: 40,000
Date of Issuance: July 31, 2001 Subject to Adjustment in the
Manner Described Below
WARRANT TO PURCHASE
40,000 SHARES (SUBJECT TO ADJUSTMENT)
OF COMMON STOCK OF
LENDINGTREE, INC.
LendingTree, Inc., a Delaware corporation (the "COMPANY"), for value
received, hereby certifies that The Union Labor Life Insurance Company, a
Maryland corporation, on behalf of its Separate Account P (collectively, with
its registered assigns the "REGISTERED HOLDER"), is entitled, subject to the
terms set forth below, to purchase from the Company, at any time on or after
July 31, 2001 until March 7, 2006 (the "EXERCISE PERIOD"), 40,000 (subject to
adjustment as provided herein) fully paid and nonassessable shares of the
Company's common stock, par value $.01 per share (the "COMMON STOCK"), or any
other equity securities or other property that may be issued in addition thereto
or in substitution therefor, as provided herein, at a price of $.01 per share
(the "EXERCISE PRICE"). The number and character of the shares of Common Stock
issuable upon exercise hereof and the purchase price therefor are subject to
adjustment as provided below, and the term "Common Stock" shall include, unless
the context otherwise requires, the stock and other property at the time
receivable upon the exercise of this Warrant or any warrants delivered in
substitution or exchange therefor as provided herein (the "WARRANT"). This
Warrant is being issued in connection with the termination of the commitment to
loan funds under the credit agreement, dated as of March 7, 2001, between the
Company and the Registered Holder (the "CREDIT AGREEMENT"). As used herein, the
term "WARRANT STOCK" shall mean the Common Stock issuable upon exercise of this
Warrant.
1. EXERCISE.
(a) This Warrant may be exercised in whole or part by the
Registered Holder at any time during the Exercise Period by surrendering this
Warrant at the principal office of the Company (or at such other office or
agency as the Company may designate by notice in writing to the Registered
Holder pursuant to Section 11 hereto) with the purchase form appended hereto as
Appendix A duly executed by such Registered Holder, accompanied by payment in
full by
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cash, check or wire transfer in the amount equal to (i) the number of shares of
Warrant Stock for which this Warrant is being exercised multiplied by (ii) the
Exercise Price (the "PURCHASE PRICE"). This Warrant may be exercised for less
than the full number of shares of Common Stock at the time called for hereby,
except that the number of shares receivable upon the exercise of this Warrant as
a whole, and the sum payable upon the exercise of this Warrant as a whole, shall
be proportionately reduced. Upon a partial exercise of this Warrant in
accordance with the terms hereof, this Warrant shall be surrendered, and a new
Warrant of the same tenor and for the purchase of the number of such shares not
purchased upon such exercise shall be issued by the Company to Registered Holder
without any charge therefor.
(b) The exercise of this Warrant shall be deemed to have been
effected immediately prior to the close of business on the day on which this
Warrant shall have been surrendered to the Company as provided in Section 1(a)
above. At such time, the person or persons in whose name or names any
certificates for Warrant Stock shall be issuable upon such exercise as provided
in Section 1(d) below shall be deemed to have become the Registered Holder or
Registered Holders of record of the Warrant Stock represented by such
certificates.
(c) Net Issuable Exercise.
(i) Notwithstanding the payment provisions set forth
above, in lieu of exercising this Warrant in the manner provided above
in Section 1(a), the Registered Holder may elect to receive shares of
Warrant Stock equal to the value of this Warrant by surrender of this
Warrant at the principal office of the Company, together with notice of
such election, in which event the Company shall issue to the Registered
Holder a number of shares of Warrant Stock computed using the following
formula:
X = Y (A-B)
-----
A
Where X = The number of shares of Warrant Stock to be issued to the
Registered Holder.
Y = The number of shares of Warrant Stock as to which the
Warrant is being exercised.
A = The Fair Market Value (as defined below) of one share of
Warrant Stock (at the date of such calculation).
B = The Exercise Price (as adjusted to the date of such
calculation).
(ii) "FAIR MARKET VALUE" shall mean, as of any date,
(i) if shares of the Common Stock are listed on a national securities
exchange, the average of the closing prices as reported for composite
transactions during the 20 consecutive trading days preceding the
trading day immediately prior to such date or, if no sale occurred on a
trading day, then the mean between the closing bid and asked prices on
such exchange on such trading day; (ii) if shares of the Common Stock
are not so listed but are traded on the Nasdaq National Market ("NMM"),
the average of the closing prices as reported on
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the NMM during the 20 consecutive trading days preceding the trading
day immediately prior to such date or, if no sale occurred on a trading
day, then the mean between the highest bid and lowest asked prices as
of the close of business on such trading day, as reported on the NMM;
or (iii) if the shares of the Common Stock are not traded on a national
securities exchange or the NMM but are otherwise traded
over-the-counter, the arithmetic average (for consecutive trading days)
of the mean between the highest bid and lowest asked prices as of the
close of business during the 20 consecutive trading days preceding the
trading day immediately prior to such date as quoted on the National
Association of Securities Dealers Automated Quotation system or an
equivalent generally accepted reporting service. If the Common Stock is
not so listed or admitted to unlisted trading privileges and bid and
asked prices are not so reported, the Fair Market Value shall be such
value as agreed upon by the Company and the Registered Holder or, if
the Company and the Registered Holder cannot otherwise agree, the Fair
Market Value shall be determined by an independent nationally
recognized investment banking firm experienced in valuing businesses
jointly chosen by the Registered Holder and the Company.
(d) As soon as practicable after the exercise of this Warrant,
and in any event within ten (10) days thereafter, the Company at its expense
will cause to be issued in the name of, and delivered to, the Registered Holder,
or as such Registered Holder (upon payment of any applicable transfer taxes )
may direct, a certificate or certificates for the number of shares of Warrant
Stock to which such Registered Holder shall be entitled, together with cash, in
lieu of any fraction of a share, equal to such fraction of the then Fair Market
Value on the date of exercise of one full share of Common Stock.
2. OTHER ADJUSTMENTS.
(a) Stock Dividends, Splits, Combinations, Reclassifications,
etc. In the event that the Company shall, at any time after the date of original
issuance hereof until the expiration of the Exercise Period, (i) pay a dividend
or make a distribution on its Common Stock, (ii) subdivide shares of its
outstanding Common Stock into a greater number of shares, (iii) combine its
outstanding Common Stock into a smaller number of shares, or (iv) issue any
shares of its capital stock by reclassification of its Common Stock (including
any such reclassification in connection with a consolidation or merger in which
the Company is the continuing corporation), the Registered Holder shall be
entitled to purchase the aggregate number and kind of shares which, if the
Warrant had been exercised at the Exercise Price in effect immediately prior to
such event, the Registered Holder would have owned upon such exercise and been
entitled to receive by virtue of such dividend, distribution, subdivision,
combination or reclassification; and the Exercise Price shall automatically be
adjusted immediately after the payment date, in the case of a dividend or
distribution, or the effective date, in the case of a subdivision, combination
or reclassification, to allow the purchase of such aggregate number and kind of
shares.
(b) In case of any reclassification or change of the
outstanding securities of the Company or of any merger, reorganization or
consolidation of the Company (other than a Reorganization (as defined below),
causing an adjustment in accordance with Section 3 below) or any similar
corporate reorganization on or after the date of original issuance hereof, then
and in each such case the Registered Holder of this Warrant, upon the exercise
hereof at any time
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after the consummation of such reclassification, change, merger, reorganization
or consolidation, shall be entitled to receive, in lieu of the stock or other
securities and property receivable upon the exercise hereof prior to such
consummation, the stock or other securities or property to which such Registered
Holder would have been entitled upon such consummation if such Registered Holder
had exercised this Warrant immediately prior thereto, all subject to further
adjustment as provided in paragraph (a); and in each such case, the terms of
this Section 2 shall be applicable to the shares of stock or other securities
properly receivable upon the exercise of this Warrant after such consummation.
(c) When any adjustment is required to be made pursuant to
this Section 2, the Company shall promptly mail to the Registered Holder a
certificate setting forth the Exercise Price after such adjustment and setting
forth a brief statement of the facts requiring such adjustment. Such certificate
shall also set forth the kind and amount of stock or other securities or
property into which this Warrant shall be exercisable following the occurrence
of any of the events specified in this Section 2.
3. REORGANIZATION. Simultaneous with the closing of a consolidation or
merger in which the Company is not the surviving entity or the closing of a
merger, consolidation, acquisition of all or substantially all of the assets or
stock of the Company by another entity (the "SURVIVING ENTITY") as a result of
which the stockholders of the Company will own less than 50% of the voting
capital stock of the Surviving Entity or the entity that controls such Surviving
Entity immediately after the transaction or, in the case of a sale of assets,
the Company will own after the transaction less than 50% of the assets owned by
the Company prior to the transaction (collectively a "REORGANIZATION") prior to
the exercise of the Warrant or the expiration of the Exercise Period, as a
result of which the stockholders of the Company receive cash, stock or other
property in respect of their shares of Warrant Stock, this Warrant shall become,
if it is not already, immediately exercisable. Furthermore, the Surviving Entity
will, at the closing of such Reorganization, assume the obligations of the
Company hereunder and this Warrant will be exchanged for a warrant to purchase
such kind and number of shares of capital stock or other securities or property
of the Company or the Surviving Entity to which the Registered Holder would have
been entitled if it had held the Warrant Stock issuable upon the exercise hereof
immediately prior to such Reorganization, which warrant shall have the same
terms and conditions hereof. The Company shall deliver to the Registered Holder
notice of the Reorganization no less than thirty (30) business days before the
date scheduled for closing of the Reorganization.
4. SALE OF SHARES BELOW PURCHASE PRICE.
(a) If at any time or from time to time the Company sells, or
is deemed by the express provisions of this Section 4 to have sold, Additional
Shares of Common Stock (as hereinafter defined), other than as a dividend or
other distribution on any class of stock as provided in Section 2 and other than
upon a subdivision, combination or reclassification of shares of Common Stock as
provided in Section 2, for an Effective Price (as hereinafter defined) less than
the Fair Market Value, then in such case the number of shares of Warrant Stock
for which this Warrant shall thereafter be exercisable shall be adjusted in
accordance with the following formula:
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N' = N x O'
---------
O + P x A
-----
M
where:
N' = the adjusted number of shares of Warrant Stock.
N = the then current number of shares of Warrant Stock.
O = the number of shares of Common Stock outstanding
immediately prior to the issuance or deemed issuance
of such Additional Shares.
P = the Effective Price for the issuance or deemed
issuance of such Additional Shares.
M = the Fair Market Value per share on the date of
issuance or deemed issuance of such Additional Shares.
O' = the number of shares of Common Stock outstanding
immediately after the issuance or deemed issuance of
such Additional Shares.
A = the number of Additional Shares of Common Stock
deemed to have been issued.
The adjustment shall be made successively whenever any such
issuance is made, and shall become effective immediately after such issuance.
Upon each adjustment of the number of shares of Warrant Stock
issuable upon exercise hereof pursuant to this Section 4(a), the Exercise Price
shall be adjusted as follows:
E'= E x N
-
N'
where:
N' = the adjusted number of shares of Warrant Stock issuable
upon exercise of this Warrant.
N = the number or shares of Warrant Stock previously
issuable upon exercise of this Warrant by payment prior
to the adjustment.
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
provided, however, that in no event shall the Exercise Price be reduced below
the par value of shares of Common Stock for which this Warrant is exercisable.
(b) For the purpose of making any adjustment required under
this Section 4, the consideration received by the Company for any issue or sale
of securities shall (i) to the extent it consists of cash be computed at the
amount of cash received by the Company, (ii) to the extent it consists of
property other than cash, be computed at the fair value of that property as
determined in good faith by the Board of Directors of the Company (the "Board")
and as reasonably agreed to by the Registered Holder, (iii) if Additional Shares
of Common Stock, Convertible Securities (as hereinafter defined) or rights or
options to purchase either Additional Shares of Common Stock or Convertible
Securities are issued or sold together with other stock
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or securities or other assets of the Company for a consideration which covers
both, be computed as the portion of the consideration so received that may be
reasonably determined in good faith by the Board and as reasonably agreed to by
the Registered Holder to be allocable to such Additional Shares of Common Stock,
Convertible Securities or rights or options, and (iv) be computed after
reduction for all indemnity fees, discounts and commissions and placement or
similar fees.
(c) For the purpose of the adjustment required under this
Section 4, if the Company issues or sells any rights or options for the purchase
of, or stock or other securities convertible into or exchangeable for,
Additional Shares of Common Stock (such convertible or exchangeable stock or
securities being hereinafter referred to as "Convertible Securities") and if the
Effective Price of such Additional Shares of Common Stock is less than the Fair
Market Value then in effect, then in each case the Company shall be deemed to
have issued at the time of the issuance of such rights or options or Convertible
Securities the maximum number of Additional Shares of Common Stock issuable upon
exercise, conversion or exchange thereof and to have received as consideration
for the issuance of such shares an amount equal to the total amount of the
consideration, if any, received by the Company for the issuance of such rights
or options or Convertible Securities, plus, in the case of such rights or
options, the minimum amounts of consideration, if any, payable to the Company
upon the exercise of such rights or options, plus, in the case of Convertible
Securities, the minimum amounts of consideration, if any, payable to the Company
(other than by cancellation of liabilities or obligations evidenced by such
Convertible Securities) upon the conversion or exchange thereof. No further
adjustment of the number of shares of Warrant Stock issuable hereunder, adjusted
upon the issuance of such rights, options or Convertible Securities, shall be
made as a result of the actual issuance of Additional Shares of Common Stock on
the exercise of any such rights or options or the conversion or exchange of any
such Convertible Securities. If any such rights or options or the conversion or
exchange privilege represented by any such Convertible Securities shall expire
without having been exercised, converted or exchange, the number of shares of
Warrant Stock issuable hereunder shall be readjusted to the number which would
have been in effect had an adjustment been made on the basis that the only
Additional Shares of Common Stock so issued were the Additional Shares of Common
Stock, if any, actually issued or sold on the exercise of such rights or options
or rights of conversion or exchange of such Convertible Securities, and such
Additional Shares of Common Stock, if any, were issued or sold for the
consideration actually received by the Company upon such exercise, plus the
consideration, if any, actually received by the Company for the granting of all
such rights or options, whether or not exercised, plus the consideration
received for issuing or selling the Convertible Securities actually converted or
exchanged, plus the consideration, if any, actually received by the Company
(other than by cancellation of liabilities or obligations evidenced by such
Convertible Securities) on the conversion or exchange of such Convertible
Securities.
(d) For the purpose of the adjustment required under this
Section 4, if the Company issues or sells, or is deemed by the express
provisions of this subsection to have issued or sold, any rights or options for
the purchase of Convertible Securities and if the Effective Price of the
Additional Shares of Common Stock underlying such Convertible Securities is less
than the Fair Market Value then in effect, then in each such case the Company
shall be deemed to have issued at the time of the issuance of such rights or
options the maximum number of Additional Shares of Common Stock issuable upon
conversion or exchange of the total amount of Convertible Securities covered by
such rights or options and to have received as consideration
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for the issuance of such Additional Shares of Common Stock an amount equal to
the amount of consideration, if any, received by the Company for the issuance of
such rights or options, plus the minimum amounts of consideration, if any,
payable to the Company upon the exercise of such rights or options and plus the
minimum amount of consideration, if any, payable to the Company (other than by
cancellation of liabilities or obligations evidenced by such Convertible
Securities) upon the conversion or exchange of such Convertible Securities. No
further adjustment of the number of shares of Warrant Stock issuable hereunder,
adjusted upon the issuance of such rights or options, shall be made as a result
of the actual issuance of the Convertible Securities upon the exercise of such
rights or options or upon the actual issuance of Additional Shares of Common
Stock upon the conversion or exchange of such Convertible Securities. The
provisions of paragraph (c) above for the readjustment of the number of shares
of Warrant Stock issuable hereunder upon the expiration of rights or options or
the rights of conversion or exchange of Convertible Securities shall apply
mutatis mutandis to the rights, options and Convertible Securities referred to
in this paragraph (d).
(e) "ADDITIONAL SHARES OF COMMON STOCK" shall mean all shares
of Common Stock (or rights or options to acquire Common Stock) issued or deemed
to be issued by the Company on or after the Issue Date, whether or not
subsequently reacquired or retired by the Company, other than (i) shares of
Common Stock issued upon the exercise of this Warrant or the Convertible
Securities, (ii) shares issued pursuant to any agreement made or executed prior
to March 7, 2001 and disclosed in, or in the exhibits to, the Credit Agreement,
including Shares issued pursuant to Financing Transactions (as such term is
defined in the Credit Agreement), (iii) shares issued pursuant to the 1997 Stock
Option Plan, the 1998 Stock Option Plan, the Amended and Restated 1999 Stock
Option Plan, the 2001 Stock Option Plan, and the Employee Stock Purchase Plan
(each as in effect, and with respect to securities issuable thereunder, on March
7, 2001), (iv) shares of Common Stock issuable upon exercise of the warrants set
forth on Schedule A attached hereto and (v) shares of Common Stock issued or
issuable to vendors, consultants or third parties and approved by the Board of
Directors. The "Effective Price" of Additional Shares of Common Stock shall mean
the quotient determined by dividing the total number of Additional Shares of
Common Stock issued or sold, or deemed to have been issued or sold by the
Company under this Section 4, into the aggregate consideration received, or
deemed to have been received, by the Company for such issue under this Section
4, for such Additional Shares of Common Stock.
(f) Any reduction in the conversion price of any Convertible
Security, whether outstanding on the Issue Date or thereafter, or the exercise
price of any option, warrant or right to purchase Common Stock or any
Convertible Security (whether such option, warrant or right is outstanding on
the Issue Date or thereafter), to an Effective Price less than the then Fair
Market Value shall be deemed to be an issuance of such Convertible Security and
the issuance of all such options, warrants or subscription rights, and the
provisions of Section 4(c) and (d) shall apply thereto mutatis mutandis.
(g) In case any shares of stock or other securities, other
than Common Stock of the Company, shall at the time be receivable upon the
exercise of this Warrant, and in case any additional shares of such stock or any
additional such securities (or any stock or other securities convertible into or
exchangeable for any such stock or securities) shall be issued or sold for a
consideration per share such as to dilute the purchase rights evidenced by this
Warrant, then and in each such case the number of shares of Warrant Stock issued
hereunder shall
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forthwith be adjusted, substantially in the manner provided for above in this
Section 4, so as to protect the holder of this Warrant against the effect of
such dilution.
(h) In case the Company shall take a record of the holders of
shares of its stock of any class for the purpose of entitling them (i) to
receive a dividend or a distribution payable in Common Stock or in Convertible
Securities, or (ii) to subscribe for, purchase or otherwise acquire Common Stock
or Convertible Securities, then, for purposes of this Warrant, such record date
shall be deemed to be the date of the issue or sale of the Additional Shares of
Common Stock issued or sold or deemed to have been issued or sold upon the
declaration of such dividend or the making of such other distribution, or the
date of the granting of such rights of subscription, purchase or other
acquisition, as the case may be.
5. TRANSFERS. This Warrant shall be transferred by the Registered
Holder only (i) in a widely disbursed public distribution; (ii) in a private
sale in which no single party acquires warrants exercisable for more than two
percent of the Company's voting shares; or (iii) to a single party owning a
majority of the Common Stock. Notwithstanding the foregoing, neither this
Warrant nor any securities purchased upon exercise of this Warrant may be
transferred unless either (i) such transfer is registered under the Securities
Act of 1933 (the "SECURITIES ACT") and any applicable state securities or blue
sky laws or (ii) the transfer is exempt from the prospectus delivery and
registration requirements of the Securities Act and any applicable state
securities or blue sky laws. If the Registered Holder wishes to transfer the
shares pursuant to (ii) above and in the good faith determination of the General
Counsel (and/or outside counsel) of the Company), there is a reasonable basis
for the belief that such transfer would require registration under the
Securities Act and/or any applicable state securities or blue sky laws, the
Company may require that the Registered Holder furnish the Company with an
opinion of counsel, reasonably satisfactory to the Company, that such
disposition will not require registration under the Securities Act and any
applicable state securities or blue sky laws. Upon any transfer of all or a
portion of the Warrant in compliance with this Section 5 and Section 12, the
transferee shall be deemed a Registered Holder.
6. LEGEND. A legend setting forth or referring to the above
restrictions shall be placed on this Warrant, any replacement hereof and any
certificate representing a security issued pursuant to the exercise hereof, and
a stop transfer restriction or order shall be placed on the books of the Company
and with any transfer agent until such securities may be legally sold or
otherwise transferred; provided, however, that such legend shall not be required
and a stop transfer restriction order shall not be placed if (i) in the opinion
of counsel to the Registered Holder (which shall be reasonably satisfactory to
the Company) registration of any future transfer is not required by the
applicable provisions of the Securities Act, (ii) the Company shall have waived
the requirements of such legends or (iii) the transfer of Warrant Stock shall be
made in compliance with the requirements of Rule 144(k).
7. REGISTERED HOLDER ITS OWNER. Except as provided in Section 5 hereto,
the Company may deem and treat the Registered Holder of this Warrant as the
absolute owner hereof for all purposes regardless of any notice to the contrary.
8. NO IMPAIRMENT. The Company will not, by amendment of its certificate
of incorporation or through reorganization, consolidation, merger, dissolution,
issue or sale of securities, sale of assets or any other voluntary action, avoid
or seek to avoid the observance or
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performance of any of the terms of this Warrant, but will at all times in good
faith assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the
Registered Holder of this Warrant against dilution or other impairment. Without
limiting the generality of the foregoing, the Company (a) will not increase the
par value of any share of stock receivable upon the exercise of this Warrant
above the amount payable therefor upon such exercise, and (b) will take all such
action as may be necessary or appropriate in order that the Company may validly
and legally issue fully paid and non-assessable shares upon the exercise of all
Warrants at the time outstanding.
9. EXPIRATION. This Warrant (and the right to purchase securities upon
exercise hereof) shall be void and all rights represented thereby shall cease
unless exercised during the Exercise Period. All restrictions set forth herein
on the shares of capital stock issued upon exercise of any rights hereunder
shall survive such exercise and expiration of the rights granted hereunder.
10. REGISTRATION RIGHTS.
(a) The Warrant Stock is entitled to the benefits of that
certain Registration Rights Agreement among the Company, the Registered Holder
and other parties thereto dated the "Closing Date" (as defined in the Credit
Agreement), and shall be deemed "Registrable Shares" for all purposes
thereunder.
11. NOTICES OF CERTAIN TRANSACTIONS. In case:
(a) the Company shall take a record of the holders of its
Common Stock (or other stock or securities at the time deliverable upon the
exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution other than as described in Section 2,
or to receive any right to subscribe for or purchase any shares of stock of any
class or any other securities, or to receive any other right, to subscribe for
or purchase any shares of stock of any class or any other securities, or to
receive any other right, or
(b) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company, any consolidation or merger of the Company with or into
another corporation (other than a consolidation or merger in which the Company
is the surviving entity), or any transfer of all or substantially all of the
assets of the Company, or
(c) of the voluntary or involuntary dissolution, liquidation
or winding-up of the Company, then, and in each such case, the Company will mail
or cause to be mailed to the Registered Holder of this Warrant a notice
specifying, as the case may be, (i) the date on which a record is to be taken
for the purpose of such dividend distribution right, or (ii) the effective date
on which such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up is to take place, and the time, if any is
to be fixed, as of which the holders of record of Common Stock shall be entitled
to exchange their shares of Common Stock for the securities or other property
deliverable upon such reorganization, reclassification, consolidation, merger,
transfer, dissolution, liquidation or winding-up. Such notice shall be mailed at
least ten (10) days prior to the record date or effective date for the event
specified in such notice.
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12. RESERVATION OF STOCK; TAXES. The Company will at all times reserve
and keep available, solely for the issuance and delivery upon the exercise of
this Warrant, such shares of Common Stock and other stock, securities and
property, as from time to time shall be issuable upon the exercise of this
Warrant. The Company covenants that all Common Stock that may be issued upon the
exercise of rights represented by this Warrant will, upon exercise, be fully
paid and nonassessable and free from all taxes, liens and charges in respect of
the issue (other than taxes in respect of any transfer occurring
contemporaneously with such issue). The Company shall pay all taxes and any and
all United States federal, state and local taxes and other charges that may be
payable in connection with the preparation, issuance and delivery of the
certificates representing Common Stock issued hereunder.
13. EXCHANGE OF WARRANT. Upon the surrender by the Registered Holder of
this Warrant, properly endorsed, to the Company at the principal office of the
Company, the Company will, subject to the provisions of Section 4 hereof, issue
and deliver to or upon the order of such Registered Holder, at the Company's
expense, a new Warrant of like tenor, in the name of such Registered Holder or
as such Registered Holder (upon payment by such Registered Holder of any
applicable transfer taxes) may direct, calling in the aggregate on the face or
faces thereof for the number of shares of Warrant Stock called for on the face
or faces of the Warrant so surrendered.
14. REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.
15. MAILING OF NOTICES. Any notices required or permitted pursuant to
this Warrant shall be in writing and shall be deemed sufficient (i) immediately
when delivered personally or by facsimile, (ii) twenty-four (24) hours after
being deposited with an overnight courier service (e.g. Federal Express) for
next day delivery, or (iii) seventy-two (72) hours after being deposited in the
U.S. mail, as certified or registered mail, with postage prepaid, addressed as
follows:
If to the Registered Holder:
Union Labor Life Insurance Company
111 Massachusetts Avenue, N.W.
Washington, D.C. 20001
Facsimile: (202) 682-4690
Attention: Mr. Robert Kennedy
With a copy to:
Paul, Hastings, Janofsky & Walker LLP
555 South Flower Street, Suite 2300
Los Angeles, California 90071
Facsimile: (213) 627-0705
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Attention: Craig S. Seligman, Esq.
If to the Company:
LendingTree, Inc.
11115 Rushmore Drive
Charlotte, North Carolina 28277
Facsimile: (704) 540 - 2486
Attention: Keith Hall, Robert J. Flemma, Jr., Matt Packey
with a copy to:
Kennedy Covington Lobdell & Hickman, L.L.P.
100 North Tryon Street, Suite 4200
Charlotte, North Carolina 28202-4006
Facsimile: (704) 331-7598
Attention: Sean M. Jones, Esq.
Each of the foregoing parties shall be entitled to specify a different
address by giving five (5) days' advance written notice as aforesaid to the
other parties.
16. NO RIGHTS AS STOCKHOLDER. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a stockholder of the Company; and except as otherwise provided
herein, no dividend or interest shall be payable or shall accrue in respect of
this Warrant or the Warrant Stock purchasable hereunder unless, until and to the
extent that this Warrant shall be exercised.
17. NO FRACTIONAL SHARES. No fractional shares of Warrant Stock will be
issued in connection with any exercise hereunder. In lieu of any fractional
shares which would otherwise be issuable, the Company shall pay cash equal to
the product of such fraction multiplied by the Fair Market Value of one share of
Warrant Stock on the date of exercise, as determined in accordance with Section
1(c)(ii).
18. AMENDMENT OR WAIVER. This Warrant or any provision thereof may be
changed, waived, discharged or terminated only by a statement in writing signed
by the party against which enforcement of the change, waiver, discharge or
termination is sought.
19. HEADINGS. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
20. GOVERNING 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 DELAWARE, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
21. SUCCESSORS AND ASSIGNS. This Warrant shall be binding upon the
Company and inure to the benefit of the Registered Holder and its successors and
assigns.
11
12
IN WITNESS WHEREOF, the Company has executed this Warrant as of the
date first written above.
LendingTree, Inc.
By: /s/ Douglas R. Lebda
Name:Douglas R. Lebda
Title: Chief Executive Officer
12
13
APPENDIX A
FORM OF PURCHASE
[To be executed only upon exercise of Warrant]
To LendingTree, Inc.:
The undersigned registered holder of the within Warrant hereby irrevocably
exercises such Warrant for, and purchases thereunder, [ ] shares of Warrant
Stock of LendingTree, Inc. and herewith makes payment of $ therefor OR by
conversion of ______% of the Warrant, and requests that the certificates for
such shares be issued in the name of, and delivered to, whose address is set
forth below.
Date:
------------------------------------------
(Signature must conform in all respects to
name of holder as specified on the face of
Warrant)
------------------------------------------
(Street Address)
------------------------------------------
(City) (State) (Zip Code)
A-1
14
APPENDIX B
FORM OF ASSIGNMENT
FOR VALUE RECEIVED the undersigned registered owner of this Warrant hereby
sells, assigns and transfers unto the Assignee named below all of the rights of
the undersigned under the within Warrant, with respect to the number of shares
of Common Stock set forth below:
Name of Assignee ___________________________
Address_____________________________________
No. of Shares_______________________________
and does hereby irrevocably constitute and appoint __________________________
Attorney to make such transfer on the books of Lending Tree, Inc., maintained
for the purpose, with full power of substitution in the premises.
DATED:_________________________
-------------------------------
(Signature)
-------------------------------
(Witness)
B-1
15
SCHEDULE A
LAST FIRST WARRANTS PRICE
---- ----- -------- -----
CSW # 1 Phoenix Strategic Capital Corp. 9,525 $ 4.72
CSW # 2 Seacris Group, Ltd. 63,500 $ 4.72
CSW # 3 Field Richard 16,510 $ 7.87
CSW # 4 Tozer James - $ 7.87
CSW # 5 Hovde Financial Corp 9,144 $ 7.87
CSW # 6 Garrity Investments LLC 15,240 $ 7.87
CSW # 7 Schiebler William 7,620 $ 7.87
CSW # 8 Georgescu Barbara & Peter 7,620 $ 7.87
CSW # 9 Prince John 4,572 $ 7.87
CSW # 10 Prince John, ACF Courtney 1,524 $ 7.87
CSW # 11 Prince John, ACF Matthew 1,524 $ 7.87
CSW # 12 Hovde Financial Corp 6,096 $ 7.87
CSW # 13 ULLICO Separate Acct P 381,000 $ 4.72
CSW # 14 Prudential Securities Inc. 127,000 $12.00
CSW # 14 CNBC 95,250 $ 7.87
CSW # 16 CNBC 95,250 $ 7.87
CSW # 17 Tozer-Roddy Katherine 2,540 $ 7.87
CSW # 18 Roddy, Jr. James 2,540 $ 7.87
CSW # 19 Tozer-Brown Farran 2,540 $ 7.87
CSW # 20 Brown Robert 2,540 $ 7.87
CSW # 21 Tozer Elizabeth 2,540 $ 7.87
CSW # 22 Tozer Charlotte 2,540 $ 7.87
CSW # 23 Shah Raju 1,270 $ 7.87
CZ-1 Capital Z (comm. fee) 135,000
=======
992,885
In addition, in connection with and as payment for the advisory services
performed by Merrill Lynch in connection with the Financing Transactions (as
such term is defined in the Credit Agreement), the Company has agreed to issue
Merrill Lynch warrants to purchase up to 112,500 shares of Common Stock at an
exercise price of $.01 per share (56,250 of which have been issued as of July
13, 2001).