ONSOURCE Common Stock and ONSOURCE Warrants
shall be as set forth in Exhibit 5.1(a), attached hereto. (Note: The calculation
of the ONSOURCE Common Stock assumes that there are 948,158 shares of ONSOURCE
common stock and stock options to purchase 22,500 shares of ONSOURCE common
stock outstanding as of the Effective Date. Any changes in the number of issued
and outstanding shares of ONSOURCE common stock and stock options to purchase
ONSOURCE common stock will change the number of shares of ONSOURCE Common Stock
to be issued hereunder).
(b)
all issued and outstanding shares of Series A
Convertible Preferred Stock of OPI (the "OPI Preferred Stock") shall be
converted into an equal number of shares of ONSOURCE Series A Convertible
Preferred Stock (the "ONSOURCE Preferred Stock"). The ONSOURCE Preferred Stock
shall consist of one million (1,000,000) shares of Series A Convertible
Preferred Stock having a stated value of $4.00 per share. The Certificate of
Designation of Rights and Preferences of the ONSOURCE Preferred Stock, attached
hereto as Exhibit 5.1(b)(i), shall be identical to those of the currently
outstanding OPI Series A Convertible Preferred Stock, attached hereto as Exhibit
5.1(b)(ii). The ONSOURCE Preferred Stock shall have the following rights and
preferences:
Voting Rights
: None, except as provided by law.
Dividend
: The ONSOURCE Preferred Stock shall accrue a dividend at the rate of six
percent (6%) per annum on the stated value thereof, payable annually. The first
annual payment will be due on April 30, 2005 in cash as a prepayment. Accrued
interest on all subsequent dividend dates shall be payable either in cash or in
shares of ONSOURCE common stock, valued at current market price, at the option
of ONSOURCE.
Redemption Right: None.
Conversion:
Each share of ONSOURCE Preferred Stock is convertible into one share of ONSOURCE
common stock, subject to adjustment under certain circumstances.
Liquidation Preference
. $4.00 per share of ONSOURCE Preferred Stock.
(c)
all outstanding stock options to purchase common
stock of OPI (the "OPI Stock Options") shall be converted into stock options to
purchase 2,714,750 shares of ONSOURCE common stock at an exercise price of $1.00
per share and subject to the same terms and conditions as set forth in the
outstanding OPI stock options (the "ONSOURCE Stock Options"). The conversion
rate of the OPI Stock Options into the ONSOURCE Stock Options shall be as set
forth in Exhibit 5.1(c), attached hereto.
(d)
The ONSOURCE Common Stock, ONSOURCE Warrants,
ONSOURCE Preferred Stock and the ONSOURCE Stock Options (the "Merger Securities"
or "Merger Consideration") shall equal to 94% of the post-Merger fully diluted
shares of ONSOURCE, exclusive of (i) shares issuable under a convertible
debenture issued to ONSOURCE legal counsel for past services in the principal
amount of $50,000, a copy of which is attached hereto as Exhibit 5.1(d)(i), (ii)
shares issuable under the Debenture and Warrants sold by ONSOURCE in the
Debenture Private Placement defined and discussed in Section 4.9 hereof, (iii)
warrants issued to Bathgate Capital Partners as fees paid in connection with the
Merger,