p18
Page 74 of 81 Pages
(13) Irrespective of any adjustments in the Exercise Price or
the number or kind of shares purchasable upon exercise of this
Warrant, Warrants theretofore or thereafter issued may continue to
express the same price and number and kind of shares as are stated
in the similar Warrants initially issuable pursuant to this
Agreement.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall be adjusted
as required by the provisions of the foregoing Section, the Company shall
forthwith file in the custody of its Secretary or an Assistant Secretary at its
principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
including a statement of the number of additional shares of Common Stock, if
any, and such other facts as shall be necessary to show the reason for and the
manner of computing such adjustment. Each such officer's certificate shall be
made available at all reasonable times for inspection by the holder or any
holder of a Warrant executed and delivered pursuant to Section (a) and the
Company shall, forthwith after each such adjustment, mail a copy by certified
mail of such certificate to the Holder or any such holder.
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall be
outstanding, (i) if the Company shall pay any dividend or make any distribution
upon the Common Stock or (ii) if the Company shall offer to the holders of
Common Stock for subscription or purchase by them any share of any class or any
other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
Page 75 of 81 Pages
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
(j) REGISTRATION UNDER THE SECURITIES ACT OF 1933.
(1) The Company hereby agrees with the holders of the Warrants
and the Warrant Shares or their transferees (collectively, the
"Holders") that upon notice by either Commonwealth or Holders
beneficially owning at least 50% of the Warrants and Warrant Shares,
it will prepare and file with the Securities and Exchange Commission
("SEC") a registration statement under the Securities Act of 1933,
as amended (the "Act") covering the resale of the Warrant Shares and
use its best efforts to cause such registration statement to become
effective as soon as practicable thereafter. If the Company shall
determine to proceed with the actual preparation and filing of a
registration statement under the Act in connection with the proposed
offer and sale of any of its securities by it or any of its security
holders (other than a registration statement on Form S-4, S-8 or
other limited purpose form), then the Company will give written
notice of its determination to all record holders of the Warrants
and Warrant Shares. Upon the written request from any Holder, the
Company will, except as herein provided, cause all such Warrant
Shares to be included in such registration statement, all to the
extent requisite to permit the sale or other disposition by the
prospective seller or sellers of the Warrant Shares to be so
registered; provided, further, that nothing herein shall prevent the
Company from, at any time, abandoning or delaying any registration.
If any registration pursuant to this Section j(1) shall be
underwritten in whole or in part, the Company may require that the
Warrant Shares requested for inclusion by the Holders be included in
the underwriting on the same terms and conditions as the securities
otherwise being sold through the underwriters.
(2) The Company will, until such time as the Warrant Shares
may be sold under Rule 144 without volume limitation:
(A) prepare and file with the SEC such amendments to
such registration statement and supplements to the prospectus
contained therein as may be necessary to keep such
registration statement effective;
(B) furnish to the Holders participating in such
registration and to the underwriters of the securities being
registered such reasonable number of copies of the
registration statement, preliminary prospectus, final
prospectus and such other documents as such underwriters may
reasonably request in order to facilitate the public offering
of such securities;
Page 76 of 81 Pages
(C) use its best efforts to register or qualify the
securities covered by such registration statement under such
state securities or blue sky laws of such jurisdictions as the
Holders may reasonably request in writing within twenty (20)
days following the original filing of such registration
statement, except that the Company shall not for any purpose
be required to execute a general consent to service of process
or to qualify to do business as a foreign corporation in any
jurisdiction wherein it is not so qualified or subject itself
to taxation in any such jurisdiction;
(D) notify the Holders, promptly after it shall receive
notice thereof, of the time when such registration statement
has become effective or a supplement to any prospectus forming
a part of such registration statement has been filed;
(E) notify the Holders promptly of any request by the
SEC for the amending or supplementing of such registration
statement or prospectus or for additional information;
(F) prepare and file with the SEC, promptly upon the
request of any Holders, any amendments or supplements to such
registration statement or prospectus which, in the opinion of
counsel for such Holders (and concurred in by counsel for the
Company), is required under the Act or the rules and
regulations thereunder in connection with the distribution of
Common Stock by such Holders;
(G) prepare and promptly file with the SEC and promptly
notify such Holders of the filing of such amendment or
supplement to such registration statement or prospectus as may
be necessary to correct any statements or omissions if, at the
time when a prospectus relating to such securities is required
to be delivered under the Act, any event shall have occurred
as the result of which any such prospectus or any other
prospectus as then in effect would include an untrue statement
of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances in which they were made, not misleading; and
(H) advise the Holders, promptly after it shall receive
notice or obtain knowledge thereof, of the issuance of any
stop order by the SEC suspending the effectiveness of such
registration statement or the initiation or threatening of any
proceeding for that purpose and promptly use its best efforts
to prevent the issuance of any stop order or to obtain its
withdrawal if such stop order should be issued.
The Company may require each Holder of Warrant Shares as to which any
registration is being effected to furnish to the Company such information
regarding the distribution of such Warrant Shares as the Company may from time
to time reasonably request in writing.
(3) All fees, costs and expenses of and incidental to such
registration, inclusion and public offering in connection therewith shall
be borne by the Company, provided, however, that the Holders shall bear
their pro rata share of the underwriting discount and commissions and
transfer taxes. The fees, costs and expenses of registration to be borne
by the Company as provided above shall include, without limitation, all
registration, filing, and
Page 77 of 81 Pages
NASD fees, printing expenses, fees and disbursements of counsel and
accountants for the Company, and all legal fees and disbursements and
other expenses of complying with state securities or blue sky laws of any
jurisdictions in which the securities to be offered are to be registered
and qualified (except as provided above). Fees and disbursements of
counsel and accountants for the Holders and any other expenses incurred by
the Holders not expressly included above shall be borne by the Holders.
(4) The Company will indemnify and hold harmless each Holder of
Warrant Shares which are included in a registration statement pursuant to
the provisions of Section (j)(1) hereof, its directors and officers, and
any underwriter (as defined in the Act) for such Holder and each person,
if any, who controls such Holder or such underwriter within the meaning of
the Act, from and against, and will reimburse such Holder and each such
underwriter and controlling person with respect to, any and all loss,
damage, liability, cost and expense to which such Holder or any such
underwriter or controlling person may become subject under the Act or
otherwise, insofar as such losses, damages, liabilities, costs or expenses
are caused by any untrue statement or alleged untrue statement of any
material fact contained in such registration statement, any prospectus
contained therein or any amendment or supplement thereto, or arise out of
or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were made,
not misleading; provided, however, that the Company will not be liable in
any such case to the extent that any such loss, damage, liability, cost or
expenses arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission so made in conformity
with information furnished by such Holder, such underwriter or such
controlling person in writing specifically for use in the preparation
thereof.
(5) Each Holder of Warrant Shares included in a registration
pursuant to the provisions of Section (j)(1) hereof will indemnify and
hold harmless the Company, its directors and officers, any controlling
person and any underwriter from and against, and will reimburse the
Company, its directors and officers, any controlling person and any
underwriter with respect to, any and all loss, damage, liability, cost or
expense to which the Company or any controlling person and/or any
underwriter may become subject under the Act or otherwise, insofar as such
losses, damages, liabilities, costs or expenses are caused by any untrue
statement or alleged untrue statement of any material fact contained in
such registration statement, any prospectus contained therein or any
amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein, in light of
the circumstances in which they were made, not misleading, in each case to
the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was so made in reliance
upon and in strict conformity with written information furnished by or on
behalf of such Holder specifically for use in the preparation thereof.
(6) Promptly after receipt by an indemnified party pursuant to the
provisions of Sections (j)(4) or (5) of notice of the commencement of any
action involving the subject matter of the foregoing indemnity provisions
such indemnified party will, if a claim thereof is to be made against the
indemnifying party pursuant to the provisions of said Sections (j)(4)
Page 78 of 81 Pages
or (5), promptly notify the indemnifying party of the commencement
thereof; but the omission to so notify the indemnifying party will not
relieve it from any liability which it may have to any indemnified party
otherwise than hereunder. In case such action is brought against any
indemnified party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party shall have the right to
participate in, and, to the extent that it may wish, jointly with any
other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party, provided,
however, if counsel for the indemnifying party concludes that a single
counsel cannot under applicable legal and ethical considerations,
represent both the indemnifying party and the indemnified party, the
indemnified party or parties have the right to select separate counsel to
participate in the defense of such action on behalf of such indemnified
party or parties. After notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party pursuant
to the provisions of said Sections (j)(4) or (5) for any legal or other
expense subsequently incurred by such indemnified party in connection with
the defense thereof other than reasonable costs of investigation, unless
(i) the indemnified party shall have employed counsel in accordance with
the provisions of the preceding sentence, (ii) the indemnifying party
shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after the notice
of the commencement of the action or (iii) the indemnifying party has
authorized the employment of counsel for the indemnified party at the
expense of the indemnifying party.
FUTURELINK DISTRIBUTION CORP.
By:
-----------------------------------
Cameron Chell, Chief Executive
Officer
By:
-----------------------------------
Dated: July 19 , 1999 Raghu Kilambi, Chief Financial
Officer
Page 79 of 81 Pages
PURCHASE FORM
Dated__________
The undersigned hereby irrevocably elects to exercise the within
Warrant to the extent of purchasing ________ shares of Common Stock and hereby
makes payment of _________ in payment of the actual exercise price thereof.
---------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name_________________________________________
(Please typewrite or print in block letters)
Address______________________________________
Signature____________________________________
ASSIGNMENT FORM
FOR VALUE RECEIVED, ____________________hereby sells, assigns and
transfers unto
Name_________________________________________
(Please typewrite or print in block letters)
Address______________________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint _____________ Attorney, to transfer the same on the books
of the Company with full power of substitution in the premises.
Date________________________
Signature___________________
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