EXHIBIT 4.2
Form of Warrant Agreement
WARRANT AGREEMENT
AGREEMENT, dated as of this _____ day of __________, 2000, by and
between SFBC INTERNATIONAL, INC., a Delaware corporation (the "Company"), and
CONTINENTAL STOCK TRANSFER & TRUST CO., as Warrant Agent (the "Warrant Agent").
W I T N E S S E T H:
WHEREAS, the Company is offering to the public 1,250,000 shares of
common stock, par value $.001 per share ("Common Stock") and 625,000 Common
Stock Purchase Warrants, each to purchase one share of Common Stock (the
"Warrants"), pursuant to an underwriting agreement (the "Underwriting
Agreement") dated as of __________ __, 2000, between the Company and HD Xxxxx &
Co., Inc. as representative to the several underwriters (the "Underwriter" or
"Representative"); and
WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing to so act, in connection with the
issuance, registration, transfer, exchange and redemption of the Warrants, as
hereinafter defined, the issuance of certificates representing the Warrants, the
exercise of the Warrants, and the rights of the holders thereof;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth and for the purpose of defining the terms and
provisions of the Warrants and the certificates representing the Warrants and
the respective rights and obligations thereunder of the Company, the holders of
certificates representing the Warrants and the Warrant Agent, the parties hereto
agree as follows:
1. Definitions. As used in this Agreement, the following terms
shall have the following meanings, unless the context shall otherwise
require:
(a) "Corporate Office" shall mean the office of the
Warrant Agent (or its successor) at which at any particular time its
principal business shall be administered, which office is located at
the date of this Agreement at 0 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
(b) "Effective Date" shall mean the date that the
Registration Statement is declared effective by the Securities and
Exchange Commission (the "Commission").
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(c) "Exercise Date" shall mean, as to any Warrant,
the date on which the Warrant Agent shall have received both (a) the
Warrant Certificate representing such Warrant, with the exercise form
thereon duly executed by the Registered Holder thereof or his attorney
duly authorized in writing, and (b) payment in cash, or by official
bank or certified check made payable to the Company, of an amount in
lawful money of the United States of America equal to the Purchase
Price; provided, however, that, subject to Paragraph 4 of this
Agreement, if payment shall be made by personal or corporate check, the
exercise of the Warrant shall not be effective until the Warrant Agent
shall be satisfied that the check shall have cleared; provided,
further, that if such payment is made prior to the Warrant Expiration
Date or the expiration of a period during which a reduced Purchase
Price is in effect pursuant to Paragraph 9(f) of this Agreement and the
check shall not have cleared until after the Warrant Expiration Date or
such other date, then the Warrant shall be deemed to have been
exercised immediately prior to 5:00 P.M. New York City time on the
Warrant Expiration Date.
(d) "Purchase Price" shall mean the purchase price
per share to be paid upon exercise of each Warrant in accordance with
the terms hereof, which price shall be Nine and 60/100 dollars ($9.60)
per share for the Warrants, subject to adjustment from time to time
pursuant to the provisions of Paragraph 9 of this Agreement.
(e) "Redemption Price" shall mean the price at which
the Company may, at its option, redeem the Warrants, in accordance with
the terms of this Agreement, which price shall be ten cents ($.10) per
Warrant. The Redemption Price shall not be subject to adjustment
pursuant to this Agreement.
(f) "Registration Statement" shall mean the Company's
registration statement on Form SB_2, File No. 333-85429, which was
declared effective by the Commission on __________ __, 2000.
(g) "Registered Holder" shall mean, as to any Warrant
and as of any particular date, the person in whose name the certificate
representing the Warrant shall be registered on that date on the books
maintained by the Warrant Agent pursuant to Paragraph 6 of this
Agreement.
(h) "Transfer Agent" shall mean Continental Stock
Transfer & Trust Co., as the Company's transfer agent, or its
authorized successor, as such.
(i) "Underwriter's Purchase Option" or
"Representative's Purchase Option" shall mean the option to purchase
Common Stock and Warrants being sold to the Underwriter as part of its
compensation, as described in the Registration Statement.
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(j) "Warrant Certificate" shall mean the certificate
for the Warrants in the form attached as Exhibit A to this Agreement.
(k) "Warrant Expiration Date" shall mean 5:00 P.M.
New York City time on the first to occur of (i) ____________, 2005, or
(ii) the business day immediately preceding the Redemption Date, as
defined in Paragraph 8(c) of this Agreement; provided, that if such
date shall in the State of New York be a holiday or a day on which
banks are authorized or required to close, the Warrant Expiration Date
shall be the next day which is not such a date. Upon notice to all
warrant holders the Company shall have the right to extend the Warrant
Expiration Date.
(l) "Warrant Shares" shall mean the shares of Common
Stock issuable upon exercise of the Warrants.
2. Warrants and Issuance of Warrants Certificates.
(a) Each Warrant initially shall entitle the
Registered Holder of the Warrant Certificate representing such Warrant
to purchase, upon the exercise thereof, in accordance with the terms of
this Agreement, subject to modification and adjustment as provided in
Paragraph 9 of this Agreement, such number of shares of Common Stock as
is set forth on the certificate representing the Warrants.
(b) Upon execution of this Agreement, Warrant
Certificates representing the number of Warrants initially issuable
pursuant to the Underwriting Agreement shall be executed by the Company
and delivered to the Warrant Agent. Upon written order of the Company
signed by its President or Chairman or a Vice President and by its
Secretary or an Assistant Secretary or its Treasurer or an Assistant
Treasurer, the Warrant Certificates shall be countersigned, issued and
delivered by the Warrant Agent.
(c) From time to time, up to the Warrant Expiration
Date, the Transfer Agent shall countersign and deliver stock
certificates in required whole number denominations representing the
shares of Common Stock issuable upon the exercise of Warrants in
accordance with this Agreement.
(d) From time to time, up to the Warrant Expiration
Date, the Warrant Agent shall countersign and deliver Warrant
Certificates in required whole number denominations to the persons
entitled thereto in connection with any transfer or exchange permitted
under this Agreement; provided that no Warrant Certificates shall be
issued except (i) those initially issued hereunder or otherwise
issuable pursuant to the Underwriting Agreement, including those
issuable in exchange for certain outstanding warrants, (ii) those
issued on or after the date of this Agreement, upon the exercise of
fewer than all Warrants represented by any Warrant Certificate, to
evidence any unexercised Warrants
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held by the exercising Registered Holder, (iii) those issued upon any
transfer or exchange pursuant to Paragraph 6 of this Agreement; (iv)
those issued in replacement of lost, stolen, destroyed or mutilated
Warrant Certificates pursuant to Paragraph 7 of this Agreement; (v)
those issued pursuant to the Underwriter's Purchase Option, and (vi) at
the option of the Company, in such form as may be approved by the Board
of Directors, to reflect any adjustment or change in the Purchase Price
or the number of shares of Common Stock purchasable upon exercise of
the Warrants made pursuant to Paragraph 9 of this Agreement. In
addition, at the discretion of the Company, the Company may authorize
the issuance of additional Warrants, which shall be subject to the
provisions of this Agreement.
3. Form and Execution of Warrant Certificates.
(a) The Warrant Certificates for the Warrants shall
be substantially in the form annexed as Exhibit A to this Agreement,
(the provisions of which are hereby incorporated herein) and may have
such letters, numbers or other marks of identification or designation
and such legends, summaries or endorsements printed, lithographed or
engraved thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be
required to comply with any law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any stock exchange
on which the Warrants may be listed, or to conform to usage or to the
requirements of Paragraph 2(b) of this Agreement. The Warrant
Certificates shall be dated the date of issuance thereof (whether upon
initial issuance, transfer or exchange in lieu of mutilated, lost,
stolen, or destroyed Warrant Certificates) and issued in registered
form. Warrant Certificates shall be numbered serially in a manner
acceptable to the Company and the Warrant Agent.
(b) Warrant Certificates shall be executed on behalf
of the Company by its Chairman of the Board, President or any Vice
President and by its Secretary or an Assistant Secretary, by manual
signatures or by facsimile signatures printed thereon, and shall have
imprinted thereon a facsimile of the Company's seal. Warrant
Certificates shall be manually countersigned by the Warrant Agent and
shall not be valid for any purpose unless so countersigned. In case any
officer of the Company who shall have signed any of the Warrant
Certificates shall cease to be an officer of the Company or to hold the
particular office referenced in the Warrant Certificate before the date
of issuance of the Warrant Certificates or before countersignature by
the Warrant Agent and issue and delivery thereof, such Warrant
Certificates may nevertheless be countersigned by the Warrant Agent,
issued and delivered with the same force and effect as though the
person who signed the Warrant Certificates had not ceased to be an
officer of the Company or to hold such office. After countersignature
by the Warrant Agent, Warrant Certificates shall be delivered by the
Warrant Agent to the Registered Holder without further action by the
Company, except as otherwise provided by Paragraph 4 of this Agreement.
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4. Exercise. Each Warrant may be exercised by the Registered
Holder thereof at any time after the first anniversary of the Effective
Date of the Registration Statement, but not after the Warrant
Expiration Date, upon the terms and subject to the conditions set forth
herein and in the Warrant Certificate. A Warrant shall be deemed to
have been exercised immediately prior to the close of business on the
Exercise Date and the person entitled to receive the securities
deliverable upon such exercise shall be treated for all purposes as the
holder of those securities upon the exercise of the Warrant as of the
close of business on the Exercise Date. As soon as practicable on or
after the Exercise Date, the Warrant Agent shall deposit the proceeds
received from the exercise of a Warrant and shall notify the Company in
writing of the exercise of the Warrant. Promptly following, and in any
event within five (5) days after the date of such notice from the
Warrant Agent, the Warrant Agent, on behalf of the Company, shall cause
to be issued and delivered by the Transfer Agent, to the person or
persons entitled to receive the same, a certificate or certificates for
the securities deliverable upon such exercise, (plus a certificate for
any remaining unexercised Warrants of the Registered Holder) unless
prior to the date of issuance of such certificates the Company shall
instruct the Warrant Agent to refrain from causing such issuance of
certificates pending clearance of checks received in payment of the
Purchase Price pursuant to such Warrants. Notwithstanding the
foregoing, in the case of payment made in the form of a check drawn on
an account of the Underwriter or such other investment banks and
brokerage houses as the Company shall approve in writing to the Warrant
Agent, by the Underwriter or such other investment bank or brokerage
house, certificates shall immediately be issued without prior notice to
the Company or any delay. Upon the exercise of any Warrant and
clearance of the funds received, the Warrant Agent shall promptly remit
the payment received for the Warrant (the "Warrant Proceeds") to the
Company or as the Company may direct in writing.
5. Reservation of Shares; Listing; Payment of Taxes.
(a) The Company covenants that it will at all times
reserve and keep available out of its authorized Common Stock, solely
for the purpose of issue upon exercise of Warrants, such number of
shares of Common Stock as shall then be issuable upon the exercise of
all outstanding Warrants. The Company covenants that all Warrant Shares
shall, at the time of delivery in accordance with this Agreement, be
duly and validly issued, fully paid, nonassessable and free from all
taxes, liens and charges with respect to the issue thereof (other than
those which the Company shall promptly pay or discharge), and that upon
issuance such shares shall be listed on each national securities
exchange or eligible for inclusion in each automated quotation system,
if any, on which the other shares of outstanding Common Stock of the
Company are then listed or eligible for inclusion.
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(b) The Company covenants that if any securities to
be reserved for the purpose of exercise of Warrants hereunder require
registration with, or approval of, any governmental authority under any
Federal securities law before such securities may be validly issued or
delivered upon such exercise, then the Company will in good faith and
as expeditiously as reasonably possible, endeavor to secure such
registration or approval. The Company will use reasonable efforts to
obtain appropriate approvals or registrations under state "blue sky"
securities laws. With respect to any such securities, however, Warrants
may not be exercised by, or shares of Common Stock issued to, any
Registered Holder in any state in which such exercise would be
unlawful.
(c) The Company shall pay all documentary, stamp or
similar taxes and other governmental charges that may be imposed with
respect to the issuance of Warrants, or the issuance, or delivery of
any shares upon exercise of the Warrants; provided, however, that if
the shares of Common Stock are to be delivered in a name other than the
name of the Registered Holder of the Warrant Certificate representing
any Warrant being exercised, then no such delivery shall be made unless
the person requesting the same has paid to the Warrant Agent the amount
of transfer taxes or charges incident thereto, if any.
(d) The Warrant Agent is hereby irrevocably
authorized to requisition the Company's Transfer Agent from time to
time for certificates representing shares of Common Stock issuable upon
exercise of the Warrants, and the Company will authorize the Transfer
Agent to comply with all such proper requisitions. The Company will
file with the Warrant Agent a statement setting forth the name and
address of the Transfer Agent of the Company for shares of Common Stock
issuable upon exercise of the Warrants.
6. Exchange and Registration of Transfer.
(a) Warrant Certificates may be exchanged for other
Warrant Certificates representing an equal aggregate number of Warrants
of the same class or may be transferred in whole or in part. Warrant
Certificates to be exchanged shall be surrendered to the Warrant Agent
at its Corporate Office, and upon satisfaction of the terms and
provisions of this Agreement, the Company shall execute and the Warrant
Agent shall countersign, issue and deliver in exchange therefor the
Warrant Certificate or Certificates which the Registered Holder making
the exchange shall be entitled to receive.
(b) The Warrant Agent shall keep at its office books
in which, subject to such reasonable regulations as it may prescribe,
it shall register Warrant Certificates and the transfer thereof in
accordance with its regular practice. Upon due presentment for
registration of transfer of any Warrant Certificate at such office, the
Company shall execute and the Warrant Agent shall issue and deliver to
the transferee or transferees a new Warrant Certificate or Certificates
representing an equal aggregate number of Warrants.
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(c) With respect to all Warrant Certificates
presented for registration or transfer, or for exchange or exercise,
the subscription form on the reverse thereof shall be duly endorsed, or
be accompanied by a written instrument or instruments of transfer and
subscription, in form satisfactory to the Company and the Warrant
Agent, duly executed by the Registered Holder or his attorney_in_fact
duly authorized in writing.
(d) A reasonable service charge may be imposed by the
Warrant Agent for any exchange or registration of transfer of Warrant
Certificates. In addition, the Company may require payment by such
holder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any exchanges,
registration or transfer of Warrant Certificates.
(e) All Warrant Certificates surrendered for exercise
or for exchange in case of mutilated Warrant Certificates shall be
promptly canceled by the Warrant Agent and thereafter retained by the
Warrant Agent until termination of this Agreement or resignation as
Warrant Agent, or, with the prior written consent of the Underwriter,
disposed of or destroyed, at the direction of the Company.
(f) Prior to due presentment for registration of
transfer thereof, the Company and the Warrant Agent may deem and treat
the Registered Holder of any Warrant Certificate as the absolute owner
thereof and of each Warrant represented thereby (notwithstanding any
notations of ownership or writing thereon made by anyone other than a
duly authorized officer of the Company or the Warrant Agent) for all
purposes and shall not be affected by any notice to the contrary.
7. Loss or Mutilation. Upon receipt by the Company and the
Warrant Agent of evidence satisfactory to them of the ownership of and
loss, theft, destruction or mutilation of any Warrant Certificate and
(in case of loss, theft or destruction) of indemnity satisfactory to
them, and (in the case of mutilation) upon surrender and cancellation
thereof, the Company shall execute and the Warrant Agent shall (in the
absence of notice to the Company and/or Warrant Agent that the Warrant
Certificate has been acquired by a bona fide purchaser) countersign and
deliver to the Registered Holder in lieu thereof a new Warrant
Certificate of like tenor representing an equal aggregate number of
Warrants. Applicants for a substitute Warrant Certificate shall comply
with such other reasonable regulations and pay such other reasonable
charges as the Warrant Agent may prescribe.
8. Redemption.
(a) Commencing twelve (12) months from the Effective
Date or earlier with the consent of the Underwriter, the Company shall
have the right,
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on not less than thirty (30) nor more than sixty (60) days notice given
prior to the Redemption Date, as hereinafter defined, at any time to
redeem the then outstanding Warrants at the Redemption Price, provided
that the Market Price of the Common Stock shall equal or exceed the
"Target Price" with respect to the class of Warrants as to which the
Company is exercising its right of redemption. The "Target Price" shall
mean one hundred fifty percent (150%) of the Purchase Price with
respect to the Warrants. Market Price for the purpose of this Paragraph
8 shall mean, if the Common Stock is listed on the Nasdaq Stock Market
or the New York or American Stock Exchange or Pacific Exchange, the
average last reported sales price (or, if no sale is reported on any
such trading day, the average of the closing bid and asked prices) on
the principal market for the Common Stock or, if the Common Stock is
not so listed or traded, the average of the last reported bid prices of
the Common Stock, during the twenty (20) day period ending within three
(3) days of the date the Warrants are called for redemption. Notice of
redemption shall be mailed by first class mail, postage prepaid, not
later than five (5) business days (or such longer period to which the
Underwriter may consent) after the date the Warrants are called for
redemption. All Warrants of any class of Warrants must be redeemed if
any Warrants of such class are redeemed.
(b) If the conditions set forth in Paragraph 8(a) of
this Agreement are met, and the Company desires to exercise its right
to redeem the Warrants, it shall request the Underwriter or the Warrant
Agent to mail the notice of redemption referred to in said Paragraph
8(a) to each of the Registered Holders of the Warrants to be redeemed,
first class, postage prepaid, not earlier than the sixtieth (60th) day
nor later than the thirtieth (30th) day before the date fixed for
redemption, at their last addresses as shall appear on the records
maintained pursuant to Paragraph 6(b) of this Agreement. Any notice
mailed in the manner provided herein shall be conclusively presumed to
have been duly given whether or not the Registered Holder receives such
notice. The Warrant Agent agrees to mail such notice if requested by
the Company or the Underwriter.
(c) The notice of redemption shall specify (i) the
Redemption Price, (ii) the date fixed for redemption, (iii) the place
where the Warrant Certificates shall be delivered and the redemption
price to be paid, and (iv) that the right to exercise the Warrants
shall terminate at 5:00 p.m. (New York City time) on the business day
immediately preceding the date fixed for redemption. The date fixed for
the redemption of the Warrants shall be the Redemption Date. No failure
to mail such notice nor any defect therein or in the mailing thereof
shall affect the validity of the proceedings for such redemption except
as to a Registered Holder (A) to whom notice was not mailed or (B)
whose notice was defective. An affidavit of the Warrant Agent or of the
Secretary or an Assistant Secretary of the Representative or the
Company that notice of redemption has been mailed shall, in the absence
of fraud, be prima facie evidence of the facts stated therein.
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(d) If either class of Warrant shall have been
redeemed, any right to exercise a Warrant of such class shall terminate
at 5:00 p.m. (New York City time) on the business day immediately
preceding the Redemption Date. After such time, Holders of the Warrants
shall have no further rights except to receive, upon surrender of the
Warrant, the Redemption Price without interest, subject to the
provisions of applicable laws relating to the treatment of abandoned
property. In the event that the Warrants or the Warrant Shares shall
not be subject to a current and effective registration statement under
the Securities Act of 1933, as amended, at any time subsequent to the
date the Warrants are called for redemption, the notice of redemption
shall not be effective and shall be deemed for all purposes not to have
been given. Nothing in the preceding sentence shall be construed to
prohibit or restrict the Company from thereafter calling the Warrants
for redemption in the manner provided for, and subject to the
provisions of, this Paragraph 8.
(e) From and after the Redemption Date with respect
to the Warrants, the Company shall, at the place specified in the
notice of redemption, upon presentation and surrender to the Company by
or on behalf of the Registered Holder thereof of one or more Warrant
Certificates evidencing Warrants to be redeemed, deliver or cause to be
delivered to or upon the written order of such Holder a sum in cash
equal to the Redemption Price of each such Warrant. From and after the
Redemption Date and upon the deposit or setting aside by the Company of
a sum sufficient to redeem all the Warrants called for redemption, such
Warrants shall expire and become void and all rights hereunder and
under the Warrant Certificates, except the right to receive payment of
the Redemption Price, shall cease.
(f) Notwithstanding any other provision of this
Agreement, the Company shall not call the Warrants for redemption
unless there is, at the time the Warrants are called for redemption, a
current and effective registration statement or a post_effective
amendment to the registration statement covering the issuance of the
shares of Common Stock issuable upon exercise of the Warrants.
(g) In the event that the Underwriter's Purchase
Option is exercised at a time subsequent to the redemption of the
Warrants but prior to the Warrant Expiration Date, as defined in
Paragraph 1(j) of this Agreement, then, notwithstanding any other
provisions of this Agreement, the Warrants issued upon such exercise
may be redeemed by the Company at any time after issuance.
9. Adjustment of Exercise Price and Number of Securities
Issuable upon Exercise of Warrants.
(a) In case the Company shall, at any time or from
time to time after the date of this Agreement, pay a dividend or make a
distribution on its shares of Common Stock in shares of Common Stock,
subdivide or reclassify its outstanding Common Stock into a greater
number of shares, or combine or
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reclassify its outstanding Common Stock into a smaller number of shares
or otherwise effect a combination of shares or reverse split, the
Purchase Price in effect at the time of the record date for such
dividend or distribution or of the effective date of such subdivision,
combination or reclassification shall be proportionately adjusted so
that the holder of any Warrant exercised after such date shall be
entitled to receive the aggregate number and kind of shares which, if
such Warrant had been exercised immediately prior to such time, he
would have owned upon such exercise and been entitled to receive upon
such dividend, subdivision, combination or reclassification. Such
adjustment shall be made successively whenever any event listed in this
Paragraph 9(a) shall occur.
(b) In case the Company shall, at any time or from
time to time after the date of this Agreement, issue rights or warrants
to all holders of its Common Stock entitling them to subscribe for or
purchase shares of Common Stock (or securities convertible into Common
Stock) at a price (or having a conversion price per share) less than
the current market price of the Common Stock (as defined in Paragraph
9(e) of this Agreement) on the record date mentioned below, the
Purchase Price shall be adjusted so that the same shall equal the price
determined by multiplying the Purchase Price in effect immediately
prior to the date of such issuance by a fraction, of which the
numerator shall be the number of shares of Common Stock outstanding on
the record date mentioned below plus the number of additional shares of
Common Stock which the aggregate offering price of the total number of
shares of Common Stock so offered (or the aggregate conversion price of
the convertible securities so offered) would purchase at such current
market price per share of the Common Stock, and of which the
denominator shall be the number of shares of Common Stock outstanding
on such record date plus the number of additional shares of Common
Stock offered for subscription or purchase (or into which the
convertible securities so offered are convertible). Such adjustment
shall be made successively whenever such rights or warrants are issued
and shall become effective immediately after the record date for the
determination of stockholders entitled to receive such rights or
warrants; and to the extent that shares of Common Stock are not
delivered (or securities convertible into Common Stock are not
delivered) after the expiration of such rights or warrants, the
Purchase Price shall be readjusted to the Purchase Price which would
then be in effect had the adjustments made upon the issuance of such
rights or warrants been made upon the basis of delivery of only the
number of shares of Common Stock (or securities convertible into Common
Stock) actually delivered.
(c) In case the Company shall, at any time or from
time to time after the date hereof, distribute to all holders of Common
Stock evidences of its indebtedness or assets (excluding cash dividends
or distributions paid out of current earnings and dividends or
distributions referred to in Paragraph 9(a) of this Agreement) or
subscription rights or warrants (excluding those referred to in
Paragraph 9(b) of this Agreement), then in each such case the Purchase
Price in effect
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thereafter shall be determined by multiplying the Purchase Price in
effect immediately prior thereto by a fraction, of which the numerator
shall be the total number of shares of Common Stock outstanding
multiplied by the current market price per share of Common Stock (as
defined in Paragraph 9(e) of this Agreement), less the fair market
value (as determined by the Company's Board of Directors) of said
assets or evidences of indebtedness so distributed or of such rights or
warrants, and of which the denominator shall be the total number of
shares or Common Stock outstanding multiplied by such current market
price per share of Common Stock. Such adjustment shall be made whenever
any such distribution is made and shall become effective immediately
after the record date for the determination of stockholders entitled to
receive such distribution.
(d) Whenever the Purchase Price payable upon exercise
of each Warrant is adjusted pursuant to Paragraphs 9(a), (b) or (c) of
this Agreement, the number of shares of Common Stock purchasable upon
exercise of each Warrant shall simultaneously be adjusted by
multiplying the number of shares issuable upon exercise of each Warrant
in effect on the date thereof by the Purchase Price in effect on the
date thereof and dividing the product so obtained by the Purchase
Price, as adjusted.
(e) For the purpose of any computation pursuant to
Paragraphs 9(b) and (c) of this Agreement, the current market price per
share of Common Stock at any date shall be deemed to be the average of
the daily closing prices for thirty (30) consecutive business days
commencing fifteen (15) business days before such date. The closing
price for each day shall be the reported last sale price regular way
or, in case no such reported sale takes place on such day, the average
of the last reported high bid and low asked prices regular way, in
either case on the principal national securities exchange on which the
Common Stock is admitted to trading or listed, if the Common Stock is
admitted to trading or listing on the New York or American Stock
Exchange or Pacific Exchange or on The Nasdaq Stock Market if included
in such system or if not listed or admitted to trading on such exchange
or system, the average of the highest bid and lowest asked prices as
reported by Nasdaq, or Pink Sheets, Inc., or another similar
organization if Nasdaq is no longer reporting such information, or if
not so available, the fair market price as determined by the Board of
Directors of the Company.
(f) No adjustment in the Purchase Price shall be
required unless such adjustment would require an increase or decrease
of at least five cents ($0.05) in such price; provided, however, that
any adjustments which by reason of this Paragraph 9(f) are not required
to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under this Paragraph 9 shall be
made to the nearest cent or to the nearest one_tenth of a share, as the
case may be. Anything in this Paragraph 9 to the contrary
notwithstanding, the Company may, upon notice to the record holders of
the Warrants, in its sole discretion, reduce the Purchase Price of the
Warrants, and, if such reduction is not otherwise required by this
Paragraph 9, such reduction (i) will not, unless the
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Board of Directors otherwise determines, result in any change in the
number or class of shares of Common Stock issuable upon exercise of
such Warrants, and (ii) may be of limited duration, in which event the
reduction in Purchase Price shall not apply to any Warrants exercised
after the expiration of the time during which the reduced Purchase
Price is in effect.
(g) The Company may retain a firm of independent
public accountants (who may be the regular accountants employed by the
Company) of recognized standing selected by the Board of Directors of
the Company to make any computation required by this Paragraph 9, and a
certificate signed by such firm shall be conclusive evidence of the
correctness of such adjustment.
(h) In the event that at any time, as a result of an
adjustment made pursuant to Paragraph 9(a) of this Agreement, the
holder of any Warrant thereafter shall become entitled to receive any
shares of the Company, other than Common Stock, thereafter the number
of such other shares so receivable upon exercise of any Warrant 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
Common Stock contained in Paragraphs 9(a) to (f), inclusive, of this
Agreement.
(i) The Company may elect, upon any adjustment of the
Purchase Price hereunder, to adjust the number of Warrants outstanding,
in lieu of the adjustment in the number of shares of Common Stock
purchasable upon the exercise of each Warrant as hereinabove provided,
so that each Warrant outstanding after such adjustment shall represent
the right to purchase one share of Common Stock. Each Warrant held of
record and each Warrant issuable upon exercise of the Underwriter's
Purchase Option prior to such adjustment of the number of Warrants
shall become that number of Warrants or an Underwriter's Purchase
Option to purchase that number of Warrants (calculated to the nearest
tenth) determined by multiplying the number one by a fraction, the
numerator of which shall be the Purchase Price in effect immediately
prior to such adjustment and the denominator of which shall be the
Purchase Price in effect immediately after such adjustment. Upon each
adjustment of the number of Warrants pursuant to this Paragraph 9, the
Company shall, as promptly as practicable, cause to be distributed to
each Registered Holder of Warrant Certificates on the date of such
adjustment Warrant Certificates evidencing, subject to Paragraph 10 of
this Agreement, the number of additional Warrants to which such Holder
shall be entitled as a result of such adjustment or, at the option of
the Company, cause to be distributed to such Holder in substitution and
replacement for the Warrant Certificates held by him prior to the date
of adjustment (and upon surrender thereof, if required by the Company)
new Warrant Certificates evidencing the number of Warrants to which
such Holder shall be entitled after such adjustment. With respect to
the Representative's Option, the Company shall give the registered
holders of the Representative's Purchase Option notice as to the number
of Warrants issuable in respect of such Representative's Purchase
Option
12
reflecting such adjustment. Any Warrants or notice to registered
holders of Representative's Purchase Option may be mailed by the
Warrant Agent or by first class mail, postage prepaid.
(j) In case of any reclassification, capital
reorganization or other change of outstanding shares of Common Stock,
or in case of any consolidation or merger of the Company with or into
another corporation (other than a consolidation or merger in which 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), or in case of any sale or conveyance to
another corporation of the property of the Company as, or substantially
as, an entirety (other than a sale/leaseback, mortgage or other
financing transaction), the Company shall cause effective provision to
be made so that each holder of a Warrant then outstanding shall have
the right thereafter, by exercising such Warrant, to purchase the kind
and number of shares of stock or other securities or property
(including cash) receivable upon such reclassification, capital
reorganization or other change, consolidation, merger, sale or
conveyance by a holder of the number of shares of Common Stock that
might have been purchased upon exercise of such Warrant immediately
prior to such reclassification, capital reorganization or other change,
consolidation, merger, sale or conveyance. Any such provisions shall
include provision for adjustments that shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Paragraph 9.
The Company shall not effect any such consolidation, merger or sale
unless, prior to or simultaneously with the consummation thereof, the
successor (if other than the Company) resulting from such consolidation
or merger or the corporation purchasing assets or other appropriate
corporation or entity shall assume, by written instrument executed and
delivered to the Warrant Agent, the obligation to deliver to the holder
of each Warrant such shares of stock, securities or assets as, in
accordance with the foregoing provisions, such holders may be entitled
to purchase and the other obligations under this Agreement. The
foregoing provisions shall similarly apply to successive
reclassifications, capital reorganizations and other changes of
outstanding shares of Common Stock and to successive consolidations,
mergers, sales or conveyances. In the event that, as a result of any
merger, consolidation or similar transaction, all of the holders of
Common Stock receive and are entitled to receive no consideration other
than cash in respect of their shares of Common Stock, then, at the
effective time of the transaction, the rights to purchase Common Stock
pursuant to the Warrants shall terminate, and the holders of the
Warrants shall, notwithstanding any other provisions of this Agreement
or the Warrants, receive in respect of each Warrant to purchase one (1)
share of Common Stock, upon presentation of the Warrant Certificate,
the amount by which the consideration per share of Common Stock payable
to the holders of Common Stock at such effective time exceeds the
Purchase Price in effect on such effective date, without giving effect
to the transaction. In the event that, subsequent to the effective
time, additional cash or other consideration is payable to the holders
of Common Stock of record as of the effective time, the same
consideration shall be payable to the
13
holders of the Warrants to the extent that the total cash then received
by the holders of Common Stock exceeds the Purchase Price in effect at
such effective date, without giving effect to the transaction, with the
same effect as if the Warrants had been exercised on and as of such
effective time. In the event of any merger, consolidation, sale or
lease of substantially all of the Company's assets or reorganization
whereby the Company is not the surviving corporation, in lieu of the
foregoing provisions of this Paragraph 9(j), the Company may provide in
the agreement relating to the transaction that each Warrant shall
become, be converted into or be exchanged for, such securities of the
surviving or acquiring corporation or other entity as has a value equal
to the value of the Warrants (which shall not exceed the amount by
which the consideration to be received per share of Common Stock
(valued on such date as the Company's board of directors shall
determine) exceeds the exercise price of the Warrant), the value of the
Warrants and securities being issued in exchange therefor to be
determined by the Company's Board of Directors, such determination to
be final, binding and conclusive on the Company and the holders of the
Warrants. In the event that, in such a transaction, the value of the
consideration to be received per share of Common Stock is not greater
than the exercise price of the Warrants, the Warrants shall terminate
and no consideration will be paid with respect thereof.
(k) Irrespective of any adjustments or changes in the
Purchase Price or the number of shares of Common Stock purchasable upon
exercise of the Warrants, the Warrant Certificates theretofore and
thereafter issued shall, unless the Company shall exercise its option
to issue new Warrant Certificates pursuant to Paragraphs 2(e) and 9(i)
of this Agreement, continue to express the Purchase Price per share,
the number of shares purchasable thereunder and the Redemption Price
therefor as to the Purchase Price per share, and the number of shares
purchasable and the Redemption Price therefore were expressed in the
Warrant Certificates when the same were originally issued.
(l) After any adjustment of the Purchase Price
pursuant to this Paragraph 9, the Company will promptly prepare a
certificate signed by the Chairman, President, Vice President or
Treasurer, of the Company setting forth: (i) the Purchase Price as so
adjusted, (ii) the number of shares of Common Stock purchasable upon
exercise of each Warrant after such adjustment, and, if the Company
shall have elected to adjust the number of Warrants, the number of
Warrants to which the registered holder of each Warrant shall then be
entitled, and (iii) a brief statement of the facts accounting for such
adjustment. The Company will promptly file such certificate with the
Warrant Agent and cause a brief summary thereof to be sent by first
class mail to the Representative and to each registered holder of
Warrants at his last address as it shall appear on the registry books
of the Warrant Agent. No failure to mail such notice nor any defect
therein or in the mailing thereof shall affect the validity thereof.
The affidavit of an officer of the Warrant Agent or the Secretary or an
Assistant Secretary of the Company that such notice has been mailed
shall, in the absence of fraud, constitute prima facie evidence of the
facts stated therein.
14
(m) As used in this Paragraph 9, the term "Common
Stock" shall mean and include the Company's Common Stock authorized on
the Effective Date and shall also include any capital stock of any
class of the Company thereafter authorized which shall not be limited
to a fixed sum or percentage in respect of the rights of the holders
thereof to participate in dividends and in the distribution of assets
upon the voluntary liquidation, dissolution or winding up of the
Company; provided, however, that the shares issuable upon exercise of
the Warrants shall include only shares of such class designated in the
Company's Certificate of Incorporation as Common Stock on the Effective
Date or, in the case of any reclassification, change, consolidation,
merger, sale or conveyance of the character referred to in Paragraph
9(j) of this Agreement, the stock, securities or property provided for
in such section or, in the case of any reclassification or change in
the outstanding shares of Common Stock issuable upon exercise of the
Warrants as a result of a subdivision or combination or consisting of a
change in par value, or from par value to no par value, or from no par
value to par value, such shares of Common Stock as so reclassified or
changed.
(n) Any determination as to whether an adjustment in
the Purchase Price in effect hereunder is required pursuant to this
Paragraph 9, or as to the amount of any such adjustment, if required,
shall be binding upon the holders of the warrants and the Company if
made in good faith by the Board of Directors of the Company.
(o) In lieu of an adjustment pursuant to Paragraph
9(b) of this Agreement, if the Company shall grant to the holders of
Common Stock, as such, rights or warrants to subscribe for or to
purchase Common Stock or securities convertible into or exchangeable
for or carrying a right or warrant to purchase Common Stock, the
Company may concurrently therewith grant to each Registered Holder as
of the record date for such transaction of the Warrants then
outstanding, the rights or warrants to which each Registered Holder
would have been entitled if, on the record date used to determine the
stockholders entitled to the rights or warrants being granted by the
Company, the Registered Holder were the holder of record of the number
of whole shares of Common Stock then issuable upon exercise of his
Warrants. If the Company exercises such right no adjustment which
otherwise might be called for pursuant to said Paragraph 9(b) shall be
made.
10. Fractional Warrants and Fractional Shares. If the number
of shares of Common Stock purchasable upon the exercise of each Warrant
is adjusted pursuant to Paragraph 9 of this Agreement, the Company
nevertheless shall not be required to issue fractions of shares, upon
exercise of the Warrants or otherwise, or to distribute certificates
that evidence fractional shares. With respect to any fraction of a
share called for upon any exercise hereof, the Company, at its option,
shall either issue a whole share in lieu of such fractional share or
pay to the
15
Holder an amount in cash equal to such fraction multiplied by the
current market value of such fractional share, determined as follows:
(a) If the Common Stock is listed on the New York or
American Stock Exchange or Pacific Exchange or admitted to unlisted
trading privileges on such exchange or listed for trading on the Nasdaq
Stock Market, the current value shall be the reported last sale price
of the Common Stock on such exchange or system on the last business day
prior to the date of exercise of this Warrant, or if no such sale is
made on such day, the average closing bid and asked prices for such day
on such exchange or system; or
(b) If the Common Stock is not listed or admitted to
unlisted trading privileges, the current value shall be the last
reported bid price reported by Pink Sheets, Inc. on the last business
day prior to the date of the exercise of this Warrant; or
(c) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid prices are not so reported, the
current value shall be an amount determined in such reasonable manner
as may be prescribed by the Board of Directors of the Company.
11. Warrant Holders Not Deemed Stockholders. No holder of
Warrants shall, as such, be entitled to vote or to receive dividends or
be deemed the holder of Common Stock that may at any time be issuable
upon exercise of such Warrants for any purpose whatsoever, nor shall
anything contained in this Agreement be construed to confer upon the
holder of Warrants, as such, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or upon any
matter submitted to stockholders at any meeting thereof, or to give or
withhold consent to any corporate action (whether upon any
recapitalization, issue or reclassification of stock, change of par
value or change of stock to no par value, consolidation, merger or
conveyance or otherwise), or to receive notice of meetings, or to
receive dividends or subscription rights, until such Holder shall have
exercised such Warrants and been issued shares of Common Stock in
accordance with the provisions hereof.
12. Rights of Action. All rights of action with respect to
this Agreement are vested in the respective Registered Holders of the
Warrants, and any Registered Holder of a Warrant, without consent of
the Warrant Agent or of the holder of any other Warrant, may, in his
own behalf and for his own benefit, enforce against the Company his
right to exercise his Warrants for the purchase of shares of Common
Stock in the manner provide in the Warrant Certificate and this
Agreement.
13. Agreement of Warrant Holders. Every holder of a Warrant,
by his acceptance of the Warrants, consents and agrees with the
Company, the Warrant Agent and every other holder of a Warrant that:
16
(a) The warrants are transferable only on the
registry books of the Warrant Agent by the Registered Holder thereof in
person or by his attorney duly authorized in writing and only if the
Warrant Certificates representing such Warrants are surrendered at the
office of the Warrant Agent, duly endorsed or accompanied by a proper
instrument of transfer satisfactory to the Warrant Agent and the
Company in their sole discretion, together with payment of any
applicable transfer taxes; and
(b) The Company and the Warrant Agent may deem and
treat the person in whose name the Warrant Certificate is registered as
the holder and as the absolute, true and lawful owner of the Warrants
represented thereby for all purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice or knowledge to the
contrary, except as otherwise expressly provided in Paragraph 6 of this
Agreement.
14. Cancellation of Warrant Certificates. If the Company shall
purchase or acquire any Warrant or Warrants, the Warrant Certificate or
Warrant Certificates evidencing the same shall thereupon be delivered
to the Warrant Agent and canceled by it and retired.
15. Concerning the Warrant Agent.
(a) The Warrant Agent acts hereunder as agent and in
a ministerial capacity for the Company, and its duties shall be
determined solely by the provisions of this Agreement. The Warrant
Agent shall not, by issuing and delivering Warrant certificates or by
any other act hereunder be deemed to make any representations as to the
validity, value or authorization of the Warrant Certificates or the
Warrants represented thereby or of any securities or other property
delivered upon exercise of any Warrant or whether any stock issued upon
exercise of any Warrant is fully paid and nonassessable.
(b) The Warrant Agent shall not at any time be under
any duty or responsibility to any holder of Warrant Certificates to
make or cause to be made any adjustment of the Purchase Price or the
Redemption Price provided in this Agreement, or to determine whether
any fact exists which may require any such adjustments, or with respect
to the nature or extent of any such adjustment, when made, or with
respect to the method employed in making the same. It shall not (i) be
liable for any recital or statement of facts contained herein or for
any action taken, suffered or omitted by it in reliance on any Warrant
Certificate or other document or instrument believed by it in good
faith to be genuine and to have been signed or presented by the proper
party or parties, (ii) be responsible for any failure on the part of
the Company to comply with any of its covenants and obligations
contained in this Agreement or in any Warrant Certificate, or (iii) be
liable for any act or omission in connection with this Agreement except
for its own negligence or wilful misconduct.
17
(c) The Warrant Agent may at any time consult with
counsel satisfactory to it (who may be counsel for the Company) and
shall incur no liability or responsibility for any action taken,
suffered or omitted by it in good faith in accordance with the opinion
or advice of such counsel.
(d) Any notice, statement, instrument, request,
direction, order or demand of the Company shall be sufficiently
evidenced by an instrument signed by the Chairman of the Board,
President, any Vice President, its Secretary, or Assistant Secretary,
unless other evidence in respect thereof is specifically prescribed in
this Agreement. The Warrant Agent shall not be liable for any action
taken, suffered or omitted by it in accordance with such notice,
statement, instruction, request, direction, order or demand believed by
it to be genuine.
(e) The Company agrees to pay the Warrant Agent
reasonable compensation for its services hereunder and to reimburse it
for its reasonable expenses hereunder; it further agrees to indemnify
the Warrant Agent and save it harmless against any and all costs and
counsel fees, for anything done or omitted by the Warrant Agent in the
execution of its duties and powers hereunder except losses, expenses
and liabilities arising as a result of the Warrant Agent's negligence
or wilful misconduct.
(f) The Warrant Agent may resign its duties and be
discharged from all further duties and liabilities hereunder (except
liabilities arising as a result of the Warrant Agent's own negligence
or wilful misconduct), after giving thirty (30) days' prior written
notice to the Company. At least fifteen (15) days prior to the date
such resignation is to become effective, the Warrant Agent shall cause
a copy of such notice of resignation to be mailed to the Registered
Holder of each Warrant Certificate at the Company's expense. Upon such
resignation, or any inability of the Warrant Agent to act as such under
this Agreement, the Company shall appoint a new warrant agent in
writing. If the Company shall fail to make such appointment within a
period of fifteen (15) days after it has been notified in writing of
such resignation by the resigning Warrant Agent, then the Registered
Holder of any Warrant Certificate may apply to any court of competent
jurisdiction for the appointment of a new warrant agent. Any new
warrant agent, whether appointed by the Company or by such a court,
shall be a bank or trust company having a capital and surplus, as shown
by its last published report to its stockholders, of not less than
$10,000,000 or a stock transfer company. After acceptance in writing of
such appointment by the new warrant agent is received by the Company,
such new warrant agent shall be vested with the same powers, rights,
duties and responsibilities as if it had been originally named herein
as the Warrant Agent, without any further assurance, conveyance, act or
deed; but if for any reason, it shall be necessary or expedient to
execute and deliver any further assurance, conveyance, act or deed, the
same shall be done at the expense of the Company and shall be legally
and validly executed and delivered by the resigning Warrant Agent. Not
later than the effective date of any
18
such appointment the Company shall file notice thereof with the
resigning Warrant Agent and shall forthwith cause a copy of such notice
to be mailed to the Registered Holder of each Warrant Certificate.
(g) Any corporation into which the Warrant Agent or
any new warrant agent may be converted or merged or any corporation
resulting from any consolidation to which the Warrant Agent or any new
warrant agent shall be a party or any corporation succeeding to the
trust business of the Warrant Agent shall be a successor warrant agent
under this Agreement without any further act, provided that such
corporation is eligible for appointment as successor to the Warrant
Agent under the provisions of the preceding paragraph. Any such
successor warrant agent shall promptly cause notice of its succession
as warrant agent to be mailed to the Company and to the Registered
Holder of each Warrant Certificate.
(h) The Warrant Agent, its subsidiaries and
affiliates, and any of its or their officers or directors, may buy and
hold or sell Warrants or other securities of the Company and otherwise
deal with the Company in the same manner and to the same extent and
with like effects as though it were not Warrant Agent. Nothing herein
shall preclude the Warrant Agent from acting in any other capacity for
the Company or for any other legal entity.
16. Modification of Agreement. The Warrant Agent and the
Company may, by supplemental agreement, make any changes or corrections
in this Agreement (i) that they shall deem appropriate to cure any
ambiguity or to correct any defective or inconsistent provision or
manifest mistake or error herein contained; or (ii) that they may deem
necessary or desirable and which shall not adversely affect the
interests of the holders of Warrant Certificates, including extension
of the Warrant Expiration Date or decrease in the Purchase Price;
provided, however, that this Agreement shall not otherwise be modified,
supplemented or altered in any respect except with the consent in
writing of the Registered Holders of Warrant Certificates representing
not less than fifty percent (50%) of the Warrants then outstanding; and
provided, further, that no change in the number or nature of the
securities purchasable upon the exercise of any Warrant, or increase in
the Purchase Price therefor, or the acceleration of the Warrant
Expiration Date, shall be made without the consent in writing of the
Registered Holder of the Warrant Certificate representing such Warrant,
other than such changes as are specifically prescribed by this
Agreement as originally executed or are made in compliance with
applicable law.
17. Notices. All notices provided for in this Agreement shall
be in writing signed by the party giving such notice, and, unless
otherwise expressly provided in this Agreement, delivered personally or
sent by overnight courier or messenger against receipt thereof or sent
by registered or certified mail (air mail if overseas), return receipt
requested, or by facsimile transmission or similar means of
communication. Notices sent by facsimile transmission or similar means
of
19
communication shall be confirmed by acknowledged receipt or by
registered or certified mail, return receipt requested. Notices shall
be deemed to have been received on the date of personal delivery or
telecopy or, if sent by certified or registered mail, return receipt
requested, shall be deemed to be delivered on the third business day
after the date of mailing. Notices shall be sent to the Registered
Holders at their respective addresses on the Warrant Agent's warrant
register, to the Company at 00000 Xxxxxxxx Xxxxxxxxx, Xxxxx, Xxxxxxx
00000, fax 000.000.0000, Attention: Xxxxxx Xxxxxxx, Chief Executive
Officer, and to the Warrant Agent at its Corporate Office, fax
__________. Either party may, by like notice, change the address,
person or fax number to which notice should be given.
18. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York
applicable to agreements entered and to be performed wholly within such
State, without regard to principles of conflicts of laws. The parties
hereby (a) irrevocably consent and agree that any legal or equitable
action or proceeding arising under or in connection with this Agreement
shall be brought exclusively in any Federal or state court situated in
New York County, New York, (b) irrevocably submit to and accept, with
respect to their respective properties and assets, generally and
unconditionally, the in personam jurisdiction of the aforesaid courts
and (c) agree that any process in any action commenced in such court
under this Agreement may be served upon such party personally, by
certified or registered mail, return receipt requested, or by overnight
courier service which obtains evidence of delivery, with the same full
force and effect as if personally served upon such party in New York
City, in addition to any other method of service permitted by law.
19. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the Company and, the Warrant Agent and their
respective successors and assigns, and the holders from time to time of
Warrant Certificates. Nothing in this Agreement is intended or shall be
construed to confer upon any other person any right, remedy or claim,
in equity or at law, or to impose upon any other person any duty,
liability or obligation.
20. Termination. This Agreement shall terminate at the close
of business on the Expiration Date of all the Warrants or such earlier
date upon which all Warrants have been exercised, except that the
Warrant Agent shall account to the Company for cash held by it, and the
provisions of Paragraph 15 of this Agreement shall survive any such
termination.
21. Counterparts. This Agreement may be executed in several
counterparts, which taken together shall constitute a single document.
20
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
SFBC INTERNATIONAL, INC.
By:
------------------------------------------------
Xxxxxx Xxxxxxx, Chief Executive Officer
CONTINENTAL STOCK TRANSFER & TRUST CO.
By:
------------------------------------------------
, Authorized Officer
21
EXHIBIT A
[FORM OF FACE OF WARRANT CERTIFICATE]
No. Warrant to Purchase
Shares of Common Stock
Void after __________, 2005 (or earlier upon redemption).
SFBC INTERNATIONAL, INC.
REDEEMABLE COMMON STOCK PURCHASE WARRANT
This certifies that FOR VALUE RECEIVED or registered assigns (the
"Registered Holder") is the owner of the number of Redeemable Common Stock
Purchase Warrants ("Warrants") specified above. Each Warrant initially entitles
the Registered Holder to purchase, subject to the terms and conditions set forth
in this Certificate and the Warrant Agreement (as hereinafter defined), one (1)
fully paid and nonassessable share of Common Stock, par value $.001 per share
("Common Stock"), of SFBC International, Inc., a Delaware corporation (the
"Company"), at any time during the period commencing with the issuance of this
Warrant and ending on the Expiration Date, as hereinafter defined, by delivery
of this Warrant, with the Subscription Form on the reverse hereof duly executed,
at the corporate office of Continental Stock Transfer & Trust Co., as Warrant
Agent, or its successor (the "Warrant Agent"), accompanied by payment of $9.60,
subject to adjustment as provided in the Warrant Agreement (the "Purchase
Price") in lawful money of the United States of America in cash or by official
bank or certified check made payable to the order of the Company.
This Warrant Certificate and each Warrant represented hereby are issued
pursuant to and are subject in all respects to the terms and conditions set
forth in the Warrant Agreement (the "Warrant Agreement"), dated as of __________
__, 2000, by and between the Company and the Warrant Agent.
In the event of certain contingencies provided for in the Warrant
Agreement, the Purchase Price or the number of shares of Common Stock subject to
purchase upon the exercise of each Warrant represented hereby are subject to
modification or adjustment.
Commencing ____________ ___, 2001, each Warrant represented hereby is
exercisable at the option of the Registered Holder, but no fractional shares of
Common Stock will be issued. In the case of the exercise of less than all the
Warrants represented hereby, the Company shall cancel this Warrant Certificate
upon the surrender hereof and shall execute and deliver a new Warrant
Certificates or Warrant Certificates of like tenor, which the Warrant Agent
shall countersign, for the balance of such Warrants.
The term "Expiration Date" shall mean 5:00 P.M. (New York City time) on
__ , 2005 or earlier upon redemption as hereinafter provided. If such date shall
in the State of New York be a holiday or a day on which the banks are authorized
or required to close, then the Expiration Date
22
shall mean 5:00 P.M. (New York City time) the next following day which in the
State of New York is not a holiday or a day on which banks are authorized or
required to close. Under certain circumstances as provided in the Warrant
Agreement, the period during which the Warrant may be exercised may be extended.
The Company shall not be obligated to deliver any securities pursuant
to the exercise of this Warrant unless a registration statement under the
Securities Act of 1933, as amended, with respect to such securities is
effective. The Company has covenanted and agreed that it will file a
registration statement and will use its commercially reasonably efforts to cause
the same to become effective and to keep such registration statement current
while any of the Warrants are outstanding. This Warrant shall not be exercisable
by a Registered Holder in any state where such exercise would be unlawful.
This Warrant Certificate is exchangeable, upon the surrender hereof by
the Registered Holder at the corporate office of the Warrant Agent, for a new
Warrant Certificate or Warrant Certificates of like tenor representing an equal
aggregate number of Warrants, each of such new Warrant Certificates to represent
such number of Warrants as shall be designated by such Registered Holder at the
time of such surrender. Upon payment by the Registered Holder of any tax or
other governmental charge imposed in connection therewith, for registration of
transfer of this Warrant Certificate at such office, a new Warrant Certificate
or Warrant Certificate representing an equal aggregate number of Warrants will
be issued to the transferee in exchange therefor, subject to the limitations
provided in the Warrant Agreement.
Prior to the exercise of any Warrant represented hereby, the Registered
Holder shall not be entitled to any rights of a stockholder of the Company,
including, without limitation, the right to vote or to receive dividends or
other distributions, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided in the Warrant Agreement.
Commencing __________ __, 2001, or earlier as provided in the Warrant
Agreement, this Warrant may be redeemed at the option of the Company, at a
redemption price of $.10 per Warrant at any time, provided the average closing
price for the Common Stock issuable upon exercise of such Warrant shall equal or
exceed $14.40 per share, subject to adjustment, for the twenty day period prior
to the date which is five days before the date the Warrants are called for
redemption. Notice of redemption shall be given not earlier than the thirtieth
(30th) day before the date fixed for redemption, all as provided in the Warrant
Agreement. On and after 5:00 P.M. (New York City time) on the business day
immediately preceding the date fixed for redemption, the Registered Holder shall
have no rights with respect to this Warrant except to receive the $.10 per
Warrant upon surrender of this Certificate. This Warrant may only be called for
redemption if, on the date the Warrant is called for redemption, the issuance of
the shares of Common Stock upon exercise of this Warrant is subject to a current
and effective registration statement.
Prior to due presentment for registration of transfer hereof, the
Company and the Warrant Agent may deem and treat the Registered Holder as the
absolute owner hereof and of each Warrant represented hereby (notwithstanding
any notations of ownership or writing hereon made
23
by anyone other than a duly authorized officer of the Company or the Warrant
Agent) for all purposes and shall not be affected by any notice to the contrary.
This Warrant Certificate shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements
executed and to be performed wholly within such State, without regard to
principles of conflicts of laws.
This Warrant Certificate is not valid unless countersigned by the
Warrant Agent.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed, manually or in facsimile by two of its officers thereunto duly
authorized and a facsimile of its corporate seal to be imprinted hereon.
SFBC INTERNATIONAL, INC.
Dated: By:
------------------- ---------------------------------
By:
---------------------------------
Countersigned:
CONTINENTAL STOCK TRANSFER [Seal]
& TRUST CO., as Warrant Agent
By:
------------------------------
Authorized Officer
24
[Form of Reverse of Warrant Certificate]
SUBSCRIPTION FORM
To Be Executed by the Registered Holder in Order to Exercise Warrants
THE UNDERSIGNED REGISTERED HOLDER hereby irrevocably elects to
exercise______________ Warrants represented by this Warrant Certificate to
purchase the securities issuable upon the exercise of such Warrants, and
requests that certificates for such securities shall be issued in the name of:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(please print or type name and address)
Please insert Social Security
or other identifying number
----------------------------------
and be delivered to
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(please print or type name and address)
and if such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, that a new Warrant Certificate for the balance of such
Warrants be registered in the name of, and delivered to, the Registered Holder
at the address stated below.
Date: x
----------------------------- ------------------------------------
------------------------------------
------------------------------------
Address
------------------------------------
Taxpayer Identification Number
------------------------------------
Signature Medallion Guaranteed
25
ASSIGNMENT
To Be Executed by the Registered Holder in Order to Assign Warrants
FOR VALUE RECEIVED, ______________________ hereby sells, assigns and
transfers onto
Please insert social security
or other identifying number
-------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(please print or type name and address)
______________________________ of the Warrants represented by this
Warrant Certificate, and hereby irrevocably constitutes and appoints
__________________________________________ Attorney to transfer this Warrant
Certificate on the books of the Company, with full power of substitution in the
premises.
Date: x
----------------------------- ---------------------------
Signature Medallion Guaranteed
---------------------------
THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE
GUARANTEED BY AN ELIGIBLE INSTITUTION (AS DEFINED IN RULE 17Ad_15 UNDER THE
SECURITIES AND EXCHANGE ACT OF 1934) WHICH MAY INCLUDE A COMMERCIAL BANK OR
TRUST COMPANY, SAVINGS ASSOCIATION, CREDIT UNION OR A MEMBER FIRM OF THE
AMERICAN STOCK EXCHANGE, NEW YORK STOCK EXCHANGE, PACIFIC STOCK EXCHANGE OR
MIDWEST STOCK EXCHANGE.
26
