THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE.
NEITHER THIS WARRANT NOR SUCH SECURITIES MAY BE SOLD, OFFERED
FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
SUCH ACT AND APPLICABLE STATE SECURITIES LAWS, OR SOME
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND
LAWS, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR LAWS, OR
UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH ACT.
WARRANT TO PURCHASE SHARES OF COMMON STOCK
OF
GOAMERICA, INC.
This Warrant is issued to [Insert Name of Holder], a [ ], or
its registered assigns (the "Holder"), by GoAmerica, Inc., a Delaware
corporation (the "Company"), on November ___, 2001 (the "Warrant Issue Date").
1. Purchase of Shares. Subject to the terms and conditions hereinafter
set forth, the Holder is entitled, upon surrender of this Warrant at the
principal office of the Company (or at such other place as the Company shall
notify the holder hereof in writing), to purchase from the Company [Insert
Number ( )] shares of common stock, par value $0.01 per share, of the Company
(the "Common Stock"). The number of shares of Common Stock issuable pursuant to
this Section 1 (the "Shares") shall be subject to adjustment pursuant to Section
8 hereof.
2. Exercise Price. The purchase price for the Shares shall be $3.00 per
share, and shall be subject to adjustment pursuant to Section 8 hereof (such
price per share, as adjusted from time to time, is herein referred to as the
"Exercise Price").
3. Exercise Period. This Warrant shall be exercisable, in whole or in
part, during the term commencing on the Warrant Issue Date and ending at 5:00
p.m., Eastern time, three (3) years after the Warrant Issue Date.
4. Method of Exercise. While this Warrant remains outstanding and
exercisable in accordance with Section 3 above, the Holder may exercise, in
whole or in part, the purchase rights evidenced hereby. Such exercise shall be
effected by:
(a) the surrender of the Warrant, together with a duly executed copy
of the form of Notice of Exercise attached hereto, to the Secretary of the
Company at its principal offices; and
(b) the payment to the Company of an amount equal to the aggregate
Exercise Price for the number of Shares being purchased.
5. Net Exercise. Notwithstanding any provisions herein to the contrary,
if the Fair Market Value (as defined below) of one share of the Company's Common
Stock is greater than the Exercise Price (at the date of calculation as set
forth below), in lieu of exercising this Warrant by payment of cash, the Holder
may elect to receive shares equal to the value (as determined below) of this
Warrant (or the portion thereof being canceled) by surrender of this Warrant at
the principal office of the Company together with the properly endorsed Notice
of Exercise in which event the Company shall issue to the Holder a number of
shares of Common Stock computed using the following formula:
X = Y (A-B)
-----------
A
Where X = the number of shares of Common Stock to be issued to
the Holder
Y = the number of shares of Common Stock purchasable
under the Warrant or, if only a portion of the
Warrant is being exercised, the portion of the
Warrant being canceled (at the date of such
calculation)
A = the fair market value of one share of the Company's
Common Stock (at the date of such calculation) (the
"Fair Market Value")
B = Exercise Price (as adjusted to the date of such
calculation)
For purposes of this Section 5, the fair market value of one share of Common
Stock as of a particular date shall be determined as follows: (i) if traded on a
securities exchange or through the Nasdaq National Market, the value shall be
deemed to be the average of the closing prices of the securities on such
exchange over the thirty (30) day period ending three (3) days prior to the net
exercise election; (ii) if traded over-the-counter, the value shall be deemed to
be the average of the closing bid or sale prices (whichever is applicable) over
the thirty (30) day period ending three (3) days prior to the net exercise; and
(iii) if there is no active public market, the value shall be the fair market
value thereof, as determined in good faith by the Board of Directors of the
Company.
6. Certificates for Shares. Upon the exercise of the purchase rights
evidenced by this Warrant, one or more certificates for the number of Shares so
purchased shall be issued as soon as practicable thereafter (with appropriate
restrictive legends, if applicable), and in any event within thirty (30) days of
the delivery of the subscription notice.
7. Issuance of Shares. The Company covenants that the Shares, when
issued pursuant to the exercise of this Warrant, will be duly and validly
issued, fully paid and nonassessable and free from all taxes, liens, and charges
with respect to the issuance thereof. The Company further covenants and agrees
that during the period within which the rights represented by this Warrant may
be exercised, the Company will at all times have authorized and reserved, for
the purpose of issue or transfer upon exercise of the rights evidenced by this
Warrant, a sufficient number of shares of authorized but unissued Common Stock,
or other
2
securities and property, when and as required to provide for the exercise of the
rights represented by this Warrant. The Company will take all such action as may
be necessary to assure that such shares of Common Stock may be issued as
provided herein without violation of any applicable law or regulation, or of any
requirements of any domestic securities exchange upon which the Common Stock
may be listed.
8. Adjustment of Exercise Price and Number of Shares. The number of and
kind of securities purchasable upon exercise of this Warrant and the Exercise
Price shall be subject to adjustment from time to time as follows:
(a) Subdivisions, Combinations and Other Issuances. If the Company
shall at any time prior to the expiration of this Warrant subdivide its Common
Stock, by split-up or otherwise, or combine its Common Stock, or issue
additional shares of its Common Stock as a dividend with respect to any shares
of its Common Stock, the number of Shares issuable on the exercise of this
Warrant shall forthwith be proportionately increased in the case of a
subdivision or stock dividend, or proportionately decreased in the case of a
combination. Appropriate adjustments shall also be made to the purchase price
payable per share, but the aggregate purchase price payable for the total number
of Shares purchasable under this Warrant (as adjusted) shall remain the same.
Any adjustment under this Section 8(a) shall become effective at the close of
business on the date the subdivision or combination becomes effective, or as of
the record date of such dividend, or in the event that no record date is fixed,
upon the making of such dividend.
(b) Reclassification, Reorganization and Consolidation. In case of
any reclassification, capital reorganization, or change in the Common Stock of
the Company (other than as a result of a subdivision, combination, or stock
dividend provided for in Section 8(a) above), then, as a condition of such
reclassification, reorganization, or change, lawful provision shall be made, and
duly executed documents evidencing the same from the Company or its successor
shall be delivered to the Holder, so that the Holder shall have the right at any
time prior to the expiration of this Warrant to purchase, at a total price equal
to that payable upon the exercise of this Warrant, the kind and amount of shares
of stock and other securities and property receivable in connection with such
reclassification, reorganization, or change by a holder of the same number of
shares of Common Stock as were purchasable by the Holder immediately prior to
such reclassification, reorganization, or change. In any such case appropriate
provisions shall be made with respect to the rights and interest of the Holder
so that the provisions hereof shall thereafter be applicable with respect to any
shares of stock or other securities and property deliverable upon exercise
hereof, and appropriate adjustments shall be made to the purchase price per
share payable hereunder, provided the aggregate purchase price shall remain the
same.
(c) Distributions of Other Property. In case the Company shall
distribute to all holders of its Common Stock (including any such distribution
made in connection with a consolidation or merger in which the Company is the
continuing corporation) evidences of its indebtedness or assets (excluding cash
dividends or distributions payable out of consolidated earnings or earned
surplus and dividends or distributions referred to in paragraph (a) above) or
rights, options, or warrants, or convertible or exchangeable securities
containing the right to subscribe for or purchase debt securities, assets, or
other securities of the Company (excluding those referred to in paragraph (a)
above), then in lieu of an adjustment in the number
3
of shares of Common Stock purchasable upon the exercise of this Warrant, the
Holder upon the exercise thereof at any time after such distribution shall be
entitled to receive from the Company the stock or other securities to which the
Holder would have been entitled if the Holder had exercised the Warrant
immediately prior thereto, all subject to further adjustment as provided in this
Section 8; provided, however, that no adjustment in respect of cash dividends or
interest on such stock or other securities shall be made during the term of this
Warrant or upon the exercise of this Warrant.
(d) Notice of Certain Events. If, at any time prior to the
expiration of this Warrant, (i) the Company shall declare any dividend on the
Common Stock payable in cash or shares of Common Stock, Common Stock or capital
stock of the Company; or (ii) the Company shall authorize the issuance to all
holders of shares of Common Stock of rights, options, or warrants to subscribe
for or purchase shares of Common Stock or Common Stock or of any other
subscription rights or warrants; or (iii) the Company shall authorize the
distribution to all holders of shares of Common Stock evidences of its
indebtedness or assets; or (iv) the Board of Directors of the Company shall have
approved any consolidation or merger to which the Company is a party and for
which approval of any stockholders of the Company is required, or any sale or
lease of all or substantially all of the assets of the Company or any
reclassification or change of Common Stock issuable upon exercise of this
Warrant (other than a change in par value or as a result of a subdivision or
combination), or a tender offer or exchange offer for shares of Common Stock; or
(v) the voluntary or involuntary dissolution, liquidation, or winding up of the
Company occurs; or (vi) the Company proposes to take any action that would
require an adjustment in the number or kind of securities issuable upon exercise
of this Warrant pursuant to this Section 8; then the Company shall cause to be
given to the Holder, at least twenty (20) calendar days prior to the applicable
record date specified, or promptly in the case of events for which there is no
record date, a written notice stating (A) the date as of which the holders of
record of shares of Common Stock to be entitled to receive any such dividends,
rights, options, warrants, or distribution are to be determined, or (B) the
initial expiration date set forth in any tender offer or exchange offer for
shares of Common Stock, or (C) the date on which any such consolidation, merger,
sale, lease, reclassification, change, dissolution, liquidation, or winding up
is expected to become effective or consummated, and the date as of which it is
expected that holders of record of shares of Common Stock shall be entitled to
exchange such shares for securities or other property, if any, deliverable upon
such consolidation, merger, sale, transfer, lease, reclassification, change,
dissolution, liquidation, or winding up.
(e) Notice of Adjustment. When any adjustment is required to be made
in the number or kind of shares purchasable upon exercise of the Warrant, or in
the Exercise Price, the Company shall promptly notify the Holder of such event
and of the number of shares of Common Stock or other securities or property
thereafter purchasable upon exercise of this Warrant.
9. Reservation of Stock, etc., Issuable on Exercise of Warrant. The
Company will at all times reserve and keep available, solely for issuance and
delivery on the exercise or conversion of the Warrant, all shares of Common
Stock from time to time issuable on the exercise or conversion of this Warrant
and, upon such issuance, all such shares of Common Stock will be validly issued,
fully paid and non-assessable, and free from all taxes, liens and charges with
respect to the issuance thereof.
4
10. No Impairment. Except and to the extent as waived or consented to
by the Holder, the Company will not, by amendment of its Certificate of
Incorporation or through any reorganization, 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 exercise rights of the Holder against impairment.
11. Register of Warrant. The Company shall maintain, at the principal
office of the Company (or such other office as it may designate by notice to the
holder hereof), a register in which the Company shall record the name and
address of the person in whose name this Warrant has been issued, as well as the
name and address of each transferee and each prior owner of such Warrant. The
ownership of the Warrant shall be proved by reference to the register and, prior
to due presentation for registration of transfer, the Company may treat the
person in whose name the Warrant shall be registered as the absolute owner
thereof for all purposes.
12. Replacement of Warrant. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of such Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor;
provided, however, if this Warrant of which the original Holder (its nominee, or
any of its officers, directors or general partners) is the registered holder is
lost, stolen or destroyed, the affidavit of the President, Vice President,
Treasurer or any General Partner of such Holder setting forth the circumstances
with respect to such loss, theft or destruction shall be accepted as
satisfactory evidence thereof, and no indemnity bond or other security shall be
required as a condition to the execution and delivery by the Company of a new
Warrant in replacement of such lost, stolen or destroyed Warrant other than the
Holder's written agreement to indemnify the Company.
13. Remedies. The Company stipulates that the remedies at law of the
Holder in the event of any default or threatened default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate, and that such terms may be specifically enforced by a
decree for the specific performance of any agreement contained herein or by an
injunction against a violation of any of the terms hereof or otherwise except as
may be limited by the effect of (a) bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights of
creditors or (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity).
14. No Fractional Shares or Scrip. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant, but in lieu of such fractional shares the Company shall make a cash
payment therefor on the basis of the Exercise Price then in effect.
5
15. No Stockholder Rights. Prior to exercise of this Warrant, the
Holder shall not be entitled to any rights of a stockholder with respect to the
Shares, including (without limitation) the right to vote such Shares, receive
dividends or other distributions thereon, exercise preemptive rights or be
notified of stockholder meetings, and such Holder shall not be entitled to any
notice or other communication concerning the business or affairs of the Company.
However, nothing in this Section 15 shall limit the right of the Holder to be
provided the notices required under this Warrant. No provision of this Warrant,
in the absence of affirmative action by the Holder to exercise this Warrant and
purchase Common Stock, and no mere enumeration herein of the rights or
privileges of the Holder, shall give rise to any liability of the Holder for the
Exercise Price or as a stockholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company.
16. Transfers of Warrant and Shares. Subject to compliance with
applicable federal and state securities laws, this Warrant and all rights
hereunder are transferable in whole or in part by the Holder to any person or
entity upon written notice to the Company. The transfer shall be recorded on the
books of the Company upon the surrender of this Warrant, properly endorsed, to
the Company at its principal offices, and the payment to the Company of all
transfer taxes and other governmental charges imposed on such transfer. In the
event of a partial transfer, the Company shall issue to the holders one or more
appropriate new warrants. A transfer of this Warrant or any Shares held by the
Holder or any affiliate of the Holder may be freely transferred to any other
subsidiary or affiliate of the Holder without prior consent from the Company,
the furnishing of an opinion of counsel to the Company, the filing of a
registration statement to effect such transfer or any other certification
relating to such subsidiary's or affiliate's status or financial condition.
17. Successors and Assigns. The terms and provisions of this Warrant
shall inure to the benefit of, and be binding upon, the Company and the Holders
hereof and their respective successors and assigns.
18. Amendments and Waivers. Any term of this Warrant may be amended and
the observance of any term of this Warrant may be waived (either generally or in
a particular instance and either retroactively or prospectively), with the
written consent of the Company and the Holder.
19. Assumption of Warrant. If at any time while this Warrant, or any
portion thereof, is outstanding and unexpired there shall be (a) an acquisition
of the Company by another entity by means of a merger, consolidation, or other
transaction or series of related transactions resulting in the exchange of the
outstanding shares of the Company's capital stock such that stockholders of the
Company prior to such transaction own, directly or indirectly, less than 50% of
the voting power of the surviving entity, or (b) a sale or transfer of all or
substantially all of the Company's assets to any other person, then, as a part
of such acquisition, sale or transfer, lawful provision shall be made so that
the Holder shall thereafter be entitled to receive upon exercise of this
Warrant, during the period specified herein and upon payment of the Exercise
Price then in effect, the number of shares of stock or other securities or
property of the successor corporation resulting from such acquisition, sale or
6
transfer which a holder of the shares deliverable upon exercise of this Warrant
would have been entitled to receive in such acquisition, sale or transfer if
this Warrant had been exercised immediately before such acquisition, sale or
transfer, all subject to further adjustment as provided in Section 8 and, in any
such case, appropriate adjustment (as determined by the Company's Board of
Directors) shall be made in the application of the provisions herein set forth
with respect to the rights and interests thereafter of the Holder to the end
that the provisions set forth herein (including provisions with respect to
changes in and other adjustments of the number of Shares that the Holder is
entitled to purchase) shall thereafter be applicable, as nearly as possible, in
relation to any shares of Common Stock or other securities or other property
thereafter deliverable upon the exercise of this Warrant.
20. Notices. All notices required under this Warrant shall be deemed to
have been given or made for all purposes (a) upon personal delivery, (b) upon
confirmation receipt that the communication was successfully sent to the
applicable number if sent by facsimile, (c) one day after being sent, when sent
by professional overnight courier service, or (d) five days after posting when
sent by registered or certified mail. Notices to the Company shall be sent to
the principal office of the Company (or at such other place as the Company shall
notify the Holder hereof in writing). Notices to the Holder shall be sent to the
address of the Holder on the books of the Company (or at such other place as the
Holder shall notify the Company hereof in writing).
21. Attorneys' Fees. If any action of law or equity is necessary to
enforce or interpret the terms of this Warrant, the prevailing party shall be
entitled to its reasonable attorneys' fees, costs and disbursements in addition
to any other relief to which it may be entitled.
22. Captions. The section and subsection headings of this Warrant are
inserted for convenience only and shall not constitute a part of this Warrant in
construing or interpreting any provision hereof.
23. Governing Law. This Warrant shall be governed by the laws of the
State of Delaware as applied to agreements among Delaware residents made and to
be performed entirely within the State of Delaware.
* * * * *
7
IN WITNESS WHEREOF, GoAmerica, Inc. caused this Warrant to be executed
by an officer thereunto duly authorized.
GOAMERICA, INC.
By:__________________________________________
Name:
Title:
8
NOTICE OF EXERCISE
To: GOAMERICA, INC.
The undersigned hereby elects to [check applicable subsection]:
________ (a) Purchase ___________________ shares of Common Stock of
GoAmerica, Inc., pursuant to the terms of the attached
Warrant and payment of the Exercise Price per share required
under such Warrant accompanies this notice;
OR
________ (b) Exercise the attached Warrant for [all of the shares]
[__________ of the shares] [cross out inapplicable phrase]
purchasable under the Warrant pursuant to the net exercise
provisions of Section 5 of such Warrant.
The undersigned hereby represents and warrants that the undersigned is
acquiring such shares for its own account for investment purposes only, and not
for resale or with a view to distribution of such shares or any part thereof.
WARRANTHOLDER:
[Name of Warrantholder]
By: [ ]
By:
------------------------------------
Print Name:
----------------------------
Address:
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Date:
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Name in which shares should be registered:
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