Exhibit 10.16
RW-_________
Warrant to Purchase
200,000 shares of Common Stock
REPRESENTATIVE'S WARRANT
Dated: ____________ __, 1996
THIS CERTIFIES THAT X.X. Xxxxxx & Co., Inc. (herein sometimes called
the "Holder" and the "Representative") is entitled to purchase from LIFE
CRITICAL CARE CORPORATION, a Delaware corporation (the "Company"), at the price
and during the period as hereinafter specified, up to 200,000 shares of the
Company's Common Stock, par value $0.01 per share (the "Common Stock"), at any
time during the period from the first anniversary that the Registration
Statement (as defined below) became effective (the "Effective Date") through
________ __, 2001 (60 months after the Effective Date) at $_____ per share.
This Representative's Warrant (the "Representative's Warrant") is
issued pursuant to an Underwriting Agreement dated the date hereof between the
Company and X.X. Xxxxxx & Co., Inc., as Representative of the several
Underwriters named in Schedule I thereto in connection with a public offering,
through the Underwriters, of 2,000,000 shares of Common Stock, (and up to
300,000 additional shares of Common Stock covered by an over-allotment option
granted by the Company to the Underwriters) and for the aggregate consideration
of $5.00 received by the Company for this Representative's Warrant. Except as
specifically otherwise provided herein, the Common Stock
issued pursuant to the Representative's Warrant shall bear the same terms and
conditions as described under the heading "Description of Capital Stock" in the
Registration Statement on Form SB-2, File No. 33-___________ (the
"Registration Statement"), except that the Holder shall have registration
rights under the Securities Act of 1933, as amended (the "Act"), for this
Representative's Warrant and the Common Stock issuable upon exercise of this
Representative's Warrant as more fully described in paragraph 6 herein.
Each certificate evidencing the Common Stock issuable upon exercise
of this Representative's Warrant (the "Registrable Securities") shall bear the
appropriate restrictive legend set forth below, except that any such
certificate shall not bear such restrictive legend if (a) it is transferred
pursuant to an effective registration statement under the Act or in compliance
with Rule 144 or Rule 144A promulgated under the Act, or (b) the Company is
provided with an opinion of counsel to the effect that such legend is not
required in order to establish compliance with the provisions of the Act:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. SUCH SECURITIES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION THEREFROM UNDER SAID ACT. COPIES OF THE
REPRESENTATIVE'S WARRANT COVERING REGISTRATION RIGHTS
PERTAINING TO THESE SECURITIES AND RESTRICTING THEIR TRANSFER
MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE
HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE
COMPANY AT THE OFFICE OF THE COMPANY AT NEW BALTIMORE,
MICHIGAN."
1. Exercise Rights. The rights represented by this
Representative's Warrant shall be exercised at the price, subject to
adjustment in accordance with Section 8 hereof (the "Exercise Price"), and
during the periods as follows:
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(a) Parity for Mergers or Consolidations. During the period
from the Effective Date to ____________ __, 1997 (the "First
Anniversary Date"), inclusive, the Holder shall have no right to
purchase any Common Stock hereunder, except that in the event of any
merger, consolidation or sale of substantially all the capital stock or
assets of the Company prior to the First Anniversary Date, the Holder
shall have the right to exercise this Representative's Warrant at such
time and into the kind and amount of shares of stock and other
securities and property (including cash) receivable by a holder of the
number of shares of Common Stock into which this Representative's
Warrant might have been exercisable for immediately prior thereto.
(b) Between _________, __ 1997 and ________ __, 2001, five
years from the Effective Date (the "Expiration Date"), inclusive, the
Holder shall have the option to purchase Common Stock hereunder at a
price of $____ per share [120% of the initial pubic offering price of
the Common Stock].
(c) After the Expiration Date, this Representative's Warrant
shall automatically expire and the Holder shall have no right to
purchase any Common Stock hereunder.
2. Mechanics of Exercise.
(a) Exercise for Cash. The rights represented by this
Representative's Warrant may be exercised at any time within the
periods above specified, in whole or in part, by (i) the surrender of
this Representative's Warrant (with the purchase form at the end hereof
properly executed) at the principal executive office of the Company (or
such other office or agency of the Company as it may designate by
notice in writing to the Holder at the address of the Holder appearing
on the books of the Company); (ii) payment to the Company of the
exercise price then in effect for the number of shares of Common Stock
specified in the above-mentioned purchase form together with applicable
stock transfer taxes, if any; and (iii) delivery to the Company of a
duly executed agreement signed by the person(s) designated in the
purchase form to the effect that such person(s) agree(s) to be bound by
the provisions of paragraph 6 and subparagraphs (b), (c) and (d) of
paragraph 7 hereof. This Representative's Warrant shall be deemed to
have been exercised, in whole or in part to the extent specified,
immediately prior to the close of business on the date this
Representative's Warrant is surrendered and payment is made in
accordance with the foregoing provisions of this paragraph 2, and the
person or persons in whose name or names the certificates for shares of
Common Stock shall be issuable upon such exercise shall become the
holder or holders of record of such Common Stock at that time and date.
The Common Stock and the certificates for the Common Stock so purchased
shall be delivered to the Holder within a reasonable time, not
exceeding ten (10) days after the rights represented by this
Representative's Warrant shall have been so exercised.
(b) Cashless Exercise. Notwithstanding anything to the
contrary contained in subparagraph (a) of paragraph 2, the Holder may
elect to exercise this Representative's
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Warrant in whole or in part by receiving shares of Common Stock
equal to the value (as determined below) of this Representative's
Warrant at the principal office of the Company together with notice
of such election, in which event the Company shall issue to the
Holder a number of shares of Common Stock computed using the following
formula:
X = Y(A-B)
----------
A
Where: X = the number of shares of Common Stock to be
issued to the Holder;
Y = the number of shares of Common Stock issuable
under this Warrant;
A = the current fair-market value of one share of
Common Stock (calculated as described below);
and
B = the Per Share Exercise Price.
As used herein, the current fair-market value of one
share of Common Stock shall mean the greater of (x) the average of the
closing prices of the Company's Common Stock sold on all securities
exchanges on which the Common Stock may at the time be listed and the
NASDAQ National Market, or, if there have been no sales on any such
exchange or the NASDAQ National Market on such day, the average of the
highest bid and lowest asked price on such day on The NASDAQ Stock
Market or otherwise in the domestic over-the-counter market as reported
by the National Quotation Bureau, Incorporated, or any similar
successor organization (the "Market Price"), on the trading day
immediately preceding the date notice of exercise of this
Representative's Warrant is given or (y) the average of the Market
Price per share of Common Stock for the five trading days immediately
preceding the date notice of exercise of this Representative's Warrant
is given. If on any date for which the Market Price per share of Common
Stock is to be determined, the Common Stock is not listed on any
securities exchange or quoted on the NASDAQ National Market or on The
NASDAQ Stock Market or otherwise in the over-the-counter market, the
Market Price per share of Common Stock shall be the highest price per
share which the Company could then obtain from a willing buyer (not a
current employee or director) for shares of Common Stock sold by the
Company, from authorized but unissued shares, as determined in good
faith by the Board of Directors of the Company, unless prior to such
date the Company has become subject to a merger, acquisition or other
consolidation pursuant to which the Company is not the surviving party,
in which case the Market Price per share of Common Stock shall be
deemed to be the value received by the holders of the Company's Common
Stock for each share thereof pursuant to the Company's acquisition.
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3. Transfer of Warrant. This Representative's Warrant shall not be
transferred, sold, assigned, or hypothecated for a period of twelve (12) months
commencing on the Effective Date except that it may be transferred to successors
of the Holder, and may be assigned in whole or in part to any person who is an
officer of the Holder [or to any member of the selling group and/or the officers
or partners thereof during such period]. Any such assignment shall be effected
by the Holder by (i) executing the form of assignment at the end hereof and (ii)
surrendering this Representative's Warrant for cancellation at the office or
agency of the Company referred to in paragraph 2 hereof, accompanied by a
certificate (signed by an officer of the Holder if the Holder is a corporation),
stating that each transferee is a permitted transferee under this paragraph 3;
whereupon the Company shall issue, in the name or names specified by the Holder
(including the Holder) a new Representative's Warrant or Warrants of like tenor
and representing in the aggregate rights to purchase the same number of shares
of Common Stock as are purchasable hereunder. The Representative may designate
that this Representative's Warrant be issued in varying amounts directly to its
officers and other assigns; provided, however, that such designation will only
be made by the Representative if it determines and substantiates to the Company
that such issuance will not violate the interpretation of the Board of Governors
of the National Association of Securities Dealers, Inc. ("NASD") relating to the
review of corporate financing arrangements.
4. Due Authorization of Stock Upon issuance; Reservation of Shares. The
Company covenants and agrees that all shares of Common Stock which may be issued
hereunder will, upon issuance, be duly and validly issued, fully paid and
nonassessable, and no personal liability will attach to the holder thereof. The
Company further covenants and agrees that, during the periods within which this
Representative's Warrant may be exercised, the Company will at all times have
authorized and reserved a sufficient number of shares of its Common Stock to
provide for the exercise of this Representative's Warrant.
5. No Voting Rights. This Representative's Warrant shall not
entitle the Holder to any voting rights or other rights as a shareholder of the
Company until it is actually exercised.
6. Registration Rights.
(a) Notice of Registration. Commencing twelve (12) months from
the Effective Date, the Company shall advise the Holder or its
transferee, whether the Holder holds this Representative's Warrant or
has exercised this Representative's Warrant and holds Common Stock, by
written notice at least four weeks prior to the filing of any
post-effective amendment to the Registration Statement, of any new
registration statement under the Act or of a Notification on Form 1-A
under the Act for a public offering of securities, either for the
account of the Company or for the account of any other person, and
shall, for a period of five (5) years from the Effective Date, upon the
request of the Holder, include in any such post-effective amendment,
new registration statement or Notification on Form 1-A such information
as may be required to permit a public offering of this Representative's
Warrant, and all or any of the Registrable Securities. The Company
shall supply prospectuses and such other documents as the Holder may
reasonably request in order to facilitate the public
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sale or other disposition of the Registrable Securities, use its
best efforts to register and qualify any of the Registrable Securities
for sale in such states as such Holder designates and do any and all
other acts and things which may be necessary or desirable to
enable such Holder to consummate the public sale or other
disposition of the Registrable Securities, all at no expense to the
Holder or the Representative, and furnish indemnification in the
manner provided in paragraph 7 hereof. The Holder shall furnish
information and indemnification as set forth in paragraph 7.
(b) Demand Registration Rights. On two (2) separate occasions,
if any 50% Holder (as defined below) shall request in writing from the
Company at any time that the Company register under the Act any or all
of the Registrable Securities under such circumstances that a public
distribution (within the meaning of the Act) of any such securities
will be involved, then the Company shall promptly, but no later than
four weeks after receipt of such request, file a post-effective
amendment to the current Registration Statement or a new registration
statement pursuant to the Act, so that such designated Registrable
Securities may be publicly sold under the Act as promptly as
practicable thereafter and the Company will use its best efforts to
cause such registration to become and remain effective (including the
taking of such steps as are necessary to obtain the removal of any stop
order) within ninety (90) days after the receipt of such request,
provided, that the Company has available current financial statements
and that such Holder shall furnish the Company with appropriate
information in connection therewith as the Company may reasonably
request in writing. The 50% Holder may, at its option, request the
filing of a post-effective amendment to the current Registration
Statement or a new registration statement under the Act on two (2)
occasions during the four-year period beginning one (1) year from the
Effective Date. The 50% Holder may, at its option, request the
registration of this Representative's Warrant and/or any of the Common
Stock underlying this Representative's Warrant in a registration
statement made by the Company as contemplated by Section 6(a) or in
connection with a written request made pursuant to this Section 6(b)
prior to acquisition of the Common Stock issuable upon exercise of this
Representative's Warrant. The 50% Holder may, at its option, request
such post-effective amendment or new registration statement during the
described period with respect to the Representative's Warrant and/or
the Common Stock issuable upon the exercise of the Representative's
Warrant, and such registration rights may be exercised by the 50%
Holder prior to or subsequent to the exercise of this Representative's
Warrant. Within ten (10) days after receiving any such request pursuant
to this subsection (b) of paragraph 6, the Company shall give notice to
any other Holders of this Representative's Warrant, advising that the
Company is proceeding with such post-effective amendment or
registration statement and offering to include therein the Registrable
Securities underlying that part of this Representative's Warrant held
by the other Holders, provided that they shall furnish the Company with
such appropriate information (relating to the intentions of such
Holders) in connection therewith as the Company shall reasonably
request in writing. All costs and expenses of the first post-effective
amendment or new registration statement including, but not limited to,
legal, accounting, printing and mailing fees shall be borne by the
Company. All costs and
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expenses of the second such post-effective amendment or new
registration statement shall be borne by the Holder(s). The
Company shall maintain such registration statement or post-effective
amendment current under the Act for a period of at least six months
(and for up to an additional three months if requested by the
Holder(s)) from the effective date thereof. The Company shall
supply prospectuses, and such other documents as the Holder(s) may
request in order to facilitate the public sale or other disposition of
the Registrable Securities, use its best efforts to register and
qualify any of the Registrable Securities for sale in such states as
such Holder(s) designate and furnish indemnification in the manner
provided in paragraph 7 hereof.
(c) Definition of 50% Holder. The term "50% Holder" as used in
this paragraph 6 shall mean the Holder(s) of at least 50% of this
Representative's Warrant and/or the Common Stock underlying this
Representative's Warrant and shall include any owner or combination of
owners of such securities, which ownership shall be calculated by
determining the number of shares of Common Stock held by such owner or
owners as well as the number of shares of Common Stock then issuable
upon exercise of this Representative's Warrant, all calculated on an
"as if exercised" basis.
7. Indemnification.
(a) Indemnification of Distributing Holder by Company.
Whenever pursuant to paragraph 6 a registration statement relating to
this Representative's Warrant or any Common Stock issued or issuable
upon the exercise of any warrant is filed under the Act, amended or
supplemented, the Company will indemnify and hold harmless each Holder
of the securities covered by such registration statement, amendment or
supplement (such Holder being hereinafter called the "Distributing
Holder"), and each person, if any, who controls (within the meaning of
the Act) the Distributing Holder, and each underwriter (within the
meaning of the Act) of such securities and each person, if any, who
controls (within the meaning of the Act) any such underwriter, against
any losses, claims, damages or liabilities, joint or several, to which
the Distributing Holder, any such controlling person or any such
underwriter may become subject, under the Act or otherwise, insofar as
such losses, claims, damages, or liabilities, or actions in respect
thereof, arise out of or are based upon any untrue statement or alleged
untrue statement or any material fact contained in any such
registration statement or any preliminary prospectus or final
prospectus constituting a part thereof or any amendment or supplement
thereto or any "blue sky" application or document (the "Blue Sky
Application") executed by the Company and filed in any state or other
jurisdiction in order to qualify this Representative's Warrant or any
Common Stock issued or issuable upon exercise of this Representative's
Warrant, or arise out of or are based upon the omission or the alleged
omission to the state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading. The
Company shall reimburse the Distributing Holder or such controlling
person or underwriter in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that
the Company will not be liable in any such case to the extent that any
such
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loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged
omission made in said registration statement, said preliminary
prospectus, said financial prospectus, said amendment or supplement or
said Blue Sky Application in reliance upon and in conformity with
written information furnished by such Distributing Holder or any other
Distributing Holder for use in the preparation thereof.
(b) Indemnification of Company by Distributing Holder. The
Distributing Holder will indemnify and hold harmless the Company, each
of its directors, each of its officers who have signed said
registration statement and such amendments and supplements thereto, and
each person, if any, who controls the Company (within the meaning of
the Act) against any losses, claims, damages or liabilities, joint or
several, to which the Company or any such director, officer or
controlling person may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities, or actions in
respect thereof, arise out of or are based upon (i) any untrue
statement of any material fact contained in said registration
statement, said preliminary prospectus, said final prospectus, or said
amendment or supplement, or arise out of or are based upon the omission
or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that
such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged
omission made in said registration statement, said preliminary
prospectus, said final prospectus or said amendment or supplement in
reliance upon and in conformity with written information furnished by
such Distributing Holder for use in the preparation thereof or (ii) the
Distributing Holder's failure to deliver a prospectus as required under
applicable federal or state securities laws. The Distributing Holders
shall reimburse the Company or any such director, officer or
controlling person for any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such loss,
claim, damage, liability or action.
(c) Notice of Claims. Promptly after receipt by an indemnified
party under this paragraph 7 of notice of the commencement of any
action, such indemnified party will, if a claim in respect thereof is
to be made against any indemnifying party, give the indemnifying party
notice of the commencement thereof, but the omission so to notify the
indemnifying party will not relieve it from any liability which it may
have to any indemnified party otherwise then under this paragraph 7.
(d) Participation in Defense of Claims. In case any such
action is brought against any indemnified party, and it notifies an
indemnifying party of the commencement thereof, the indemnifying party
will be entitled 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 reasonably satisfactory to such
indemnified party, and 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 under
this
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paragraph 7 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof other
than reasonable costs of investigation.
8. Adjustments to Exercise Price. The Exercise Price in
effect at any time and the number of shares purchasable upon the exercise
of this Representative's Warrant shall be subject to adjustment from time to
time upon the happening of certain events as follows:
(a) Stock Dividends, Combinations or Reclassifications. In
case the Company shall (i) declare a dividend or make a distribution on
its outstanding shares of Common Stock in shares of Common Stock, (ii)
subdivide or reclassify its outstanding shares of Common Stock into a
greater number of shares, or (iii) combine or reclassify its
outstanding shares of Common Stock into a smaller number of shares, the
Exercise 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 this Representative's Warrant exercised after such
date shall be entitled to receive the aggregate number and kind of
security which, if this Representative's Warrant had been exercised by
such Holder immediately prior to such date, he would have owned upon
such exercise and been entitled to receive upon such dividend,
distribution, subdivision, combination or reclassification. For
example, if the Company declares a 2-for-1 stock distribution, the
adjusted Exercise Price immediately after such event would be reduced
by 50% per share of Common Stock and the adjusted number of shares of
Common Stock then issuable upon exercise of the Representative's
Warrant purchasable upon exercise of this Representative's Warrant
would be doubled. Such adjustment shall be made successively whenever
any event listed above shall occur.
(b) Issuance of Rights to Purchase Common Stock. In case the
Company shall fix a record date for the issuance of 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 (the "Subscription Price") (or having a conversion
price per share) less than the current market price of the Common Stock
(as defined in Subsection (h) below) on the record date mentioned
below, or less than the Exercise Price on a per share basis (the "Per
Share Exercise Price") on such record date, the Exercise Price shall be
adjusted so that the same shall equal the lower of (i) the price
determined by multiplying the number of shares of Common Stock by the
Per Share Exercise Price in effect immediately prior to the date of
such issuance, multiplied by a fraction, the numerator of which shall
be the sum of the number of shares of Common Stock outstanding on the
record date mentioned below and 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 the denominator of
which shall be the sum of the number of shares of Common Stock
outstanding on such record date and the number of additional shares of
Common Stock offered for subscription or purchase (or into which the
convertible securities so offered are convertible) or (ii) in the event
the
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Subscription Price is equal to or higher than the current market
price but is less than the Per Share Exercise Price, the price
determined by multiplying the number of shares of Common Stock then
issuable upon exercise of this Representative's Warrant by the Per
Share Exercise Price in effect immediately prior to the date of
issuance by a fraction, the numerator of which shall be the sum of the
number of shares outstanding on the record date mentioned below and 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 the Per Share Exercise Price in effect
immediately prior to the date of such issuance, and the denominator of
which shall be the sum of the number of shares of Common Stock
outstanding on the record date mentioned below and 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 shareholders 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 Exercise
Price shall be readjusted to the Exercise 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) Distributions of Other Assets to Holders of Common Stock.
In case the Company shall hereafter distribute to all holders of its
Common Stock evidences of its indebtedness or assets (excluding cash
dividends or distributions and dividends or distributions referred to
in Subsection (a) above) or subscription rights or warrants (excluding
those referred to in Subsection (b) above), then in each such case the
Exercise Price in effect thereafter shall be determined by multiplying
the number of shares of Common Stock then issuable upon exercise of
this Representative's Warrant by the Per Share Exercise Price in effect
immediately prior thereto, multiplied by a fraction, the numerator of
which shall be the total number of shares of Common Stock then
outstanding multiplied by the current market price per share of Common
Stock (as defined in Subsection (h) below), 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 the denominator of which shall be the total number of shares of
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 shareholders entitled to receive
such distribution.
(d) Issuances of Common Stock Below Market Price. In case the
Company shall issue shares of its Common stock excluding shares issued
(i) in any of the transactions described in Subsection (a), (b), or (c)
above, (ii) upon exercise of options granted to the Company's employees
under a plan or plans adopted by the Company's Board of Directors
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and approved by its shareholders, if such shares would otherwise
be included in this Subsection (d), (iii) upon exercise of options
and warrants outstanding at ____________, 1996, or of this
Representative's Warrant or (iv) to shareholders of any corporation
which merges into the Company in proportion to their stock holdings of
such corporation immediately prior to such merger, upon such merger,
or in a bona fide public offering pursuant to a firm commitment
underwriting, but only if no adjustment is required pursuant to any
other specific subsection of this Section 8 (without regard to
Subsection (i) below), with respect to the transaction giving rise
to such rights or for a consideration per share (the "Offering Price")
(determined as provided in Subsection (g) below) less than the current
market price per share of Common Stock (as defined in Subsection (h)
below) on the date the Company fixes the offering price of such
additional shares, or the Per Share Exercise Price, the Exercise
Price shall be adjusted immediately thereafter so that it shall
equal the lower of (i) the price determined by multiplying the
number of shares of Common Stock then issuable upon exercise of
this Representative's Warrant by the Per Share Exercise Price in
effect immediately prior thereto, multiplied by a fraction, the
numerator of which shall be the sum of the number of shares of
Common Stock outstanding immediately prior to the issuance of such
additional shares and the number of shares of Common Stock which the
aggregate consideration received (determined as provided in Subsection
(g) below) for the issuance of such additional shares would purchase at
such current market price per share, and the denominator of which shall
be the number of shares of Common Stock outstanding immediately after
the issuance of such additional shares or (ii) in the event that
Offering price is equal to or higher than the current market price per
share but less than the Per Share Exercise Price, the price determined
by multiplying the number of shares of Common Stock then issuable upon
exercise of this Representative's Warrant by the Per Share Exercise
Price in effect immediately prior to the date or issuance multiplied by
a fraction, the numerator of which shall be the number of shares of
Common Stock outstanding immediately prior to the issuance of such
additional shares and the number of shares of Common Stock which the
aggregate consideration received (determined as provided in subsection
(g) below) for the issuance of such additional shares would purchase at
the per Share Exercise Price in effect immediately prior to the date of
such issuance, and the denominator of which shall be the number of
shares of Common Stock outstanding immediately after the issuance of
such additional shares. Such adjustment shall be made successively
whenever such an issuance is made.
(e) Issuances of Convertible Securities Below Market Price. In
case the Company shall issue any securities convertible into or
exchangeable for its Common Stock (excluding securities issued in
transactions described in Subsections (b) or (c) above) for an initial
consideration per share of Common Stock (the "Conversion Price")
deliverable upon conversion or exchange of such securities (determined
as provided in Subsection (g) below) less than the current market price
per share of Common Stock (as defined in Subsection (h) below) in
effect immediately prior to the issuance of such securities, or the Per
Share Exercise Price, the Exercise Price shall be adjusted immediately
thereafter so that it shall equal the lower of (i) the price determined
by multiplying the number of shares of Common
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Xxxxx then issuable upon exercise of this Representative's Warrant
by the Per Share Exercise Price in effect immediately prior thereto
multiplied, by a fraction, the numerator of which shall be the sum
of the number of shares of Common Stock outstanding immediately
prior to the issuance of such securities and the number of shares of
Common Stock which the aggregate consideration received (determined as
provided in Subsection (g) below) for such securities would purchase
at such current market price per share, and the denominator of which
shall be the sum of the number of shares of Common Stock outstanding
immediately prior to such issuance and the maximum number of shares
of Common Stock of the Company deliverable upon conversion of or
in exchange for such securities at the initial conversion or exchange
price or rate or (ii) in the event the Conversion Price is equal to
or higher than the current market price per share but less than the
Per Share Exercise Price in effect immediately prior to the date of
issuance by a fraction, the numerator of which shall be the sum of
the number of shares of Common Stock outstanding prior to the
issuance of such securities and the number of shares of Common Stock
which the aggregate consideration received (determined as provided
in subsection (g) below) for such securities would purchase at the
Per Share Exercise Price in effect immediately prior to the date of
such issuance, the denominator of which shall be the sum of the
number of shares of Common Stock outstanding immediately prior to the
issuance of such securities and the maximum number of shares of
Common Stock of the Company deliverable upon conversion of or in
exchange for such securities at the initial conversion or exchange
price or rate. Such adjustment shall be made successively whenever such
an issuance is made.
(f) Adjustments to Number of Shares Purchasable Upon Exercise.
Whenever the Exercise Price payable upon exercise of this
Representative's Warrant is adjusted pursuant to Subsections (a), (b),
(c), (d) or (e) above, the number of shares of Common Stock purchasable
upon exercise of this Representative's Warrant shall simultaneously be
adjusted by multiplying the number of shares of Common Stock issuable
upon exercise of this Representative's Warrant by the Exercise Price in
effect on the date hereof and dividing the product so obtained by the
Exercise Price, as adjusted.
(g) Determination of Consideration. For purposes of any
computation respecting consideration received pursuant to Subsections
(d) and (e) above, the following shall apply:
(A) in the case of the issuance of shares of Common
Stock for cash, the consideration shall be the amount of such cash,
provided that in no case shall any deduction be made for any
commissions, discounts or other expenses incurred by the Company for
any underwriting of the shares or otherwise in connection therewith;
(B) in the case of the issuance of shares of Common
Stock for a consideration in whole or in part other than cash, the
consideration other than cash shall be deemed to be the fair market
value thereof as determined in good faith by the Board of
12
Directors of the Company (irrespective of the accounting treatment
thereof), whose determination shall be conclusive; and
(C) in the case of the issuance of securities
convertible into or exchangeable for shares of Common Stock the
aggregate consideration received therefor shall be deemed to be the
consideration received by the Company for the issuance of such
securities plus the additional minimum consideration, if any, to be
received by the Company upon the conversion or exchange thereof (the
consideration in each case to be determined in the same manner as
provided in clauses (A) and (B) of this Subsection (g)).
(h) Determination of Market Price. For the purpose of any
computation under Subsections (b), (c), (d) or (e) above, the current
market price per share of Common Stock at any date shall be deemed to
be the average of the daily closing prices of the Common Stock for
thirty (30) consecutive business days before such date. The closing
price for each day shall be the last sale price regular way or, in case
no such reported sale takes place on such day, the average of the last
reported bid and asked prices regular way, in either case on the
principal national securities exchange on which the Common Stock is
admitted to trading or listed, or if not listed or admitted to trading
on such exchange, the average of the highest reported bid and lowest
reported asked prices as reported by NASDAQ, or other 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.
(i) Calculations of Adjustments. No adjustment in the Exercise
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
Subsection (i) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment required to be made
hereunder. All calculations under this Section 8 shall be made to the
nearest cent or to the nearest one-hundredth of a share, as the case
may be. Anything in this Section 8 to the contrary notwithstanding, the
Company shall be entitled, but shall not be required, to make such
changes in the Exercise Price, in addition to those required by this
Section 8, as it shall determine, in its sole discretion, to be
advisable in order that any dividend or distribution in shares of
Common Stock, or any subdivision, reclassification or combination of
Common Stock, hereafter made by the Company shall not result in any
Federal income tax liability to the holders of Common Stock.
(j) Notice of Adjustments. Whenever the Exercise Price is
adjusted, as herein provided, the Company shall promptly cause a notice
setting forth the adjusted Exercise Price and adjusted number of shares
of Common Stock issuable upon exercise of this Representative's Warrant
to be mailed to the Holder, at its address set forth herein, and shall
cause a certified copy thereof to be mailed to the Company's transfer
agent, if any. The Company may retain a firm of independent certified
public accountants selected by the Board of Directors (who may be the
regular accountants employed by the Company) to make any
13
computation required by this Section 8, and a certificate signed by
such firm shall be conclusive evidence of the correctness of such
adjustment.
(k) Protection Against Dilution. In the event that at any
time, as a result of an adjustment made pursuant to the provisions of
this Section 8, the Holder of this Representative's 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 this Representative's 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 Subsections (a) to (i), inclusive, above.
9. Governing Law. This Agreement shall be governed by and in
accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the Company has caused this Representative's
Warrant to be signed by its duly authorized officers under its corporate seal,
and this Representative's Warrant to be dated ___________________, 1996.
LIFE CRITICAL CARE CORPORATION
[CORPORATE SEAL] By: ______________________________
Attest: Title: ___________________________
-----------------------------
14
EXERCISE FORM
(To be executed upon exercise of Representative's Warrant)
Life Critical Care Corporation
00000 Xxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxx 00000
The undersigned hereby irrevocably elects to exercise the
right, represented by this Representative's Warrant, to purchase shares of
Common Stock of Life Critical Care Corporation and (check one):
[ ] herewith tenders payment for ___________ shares of Common
Stock to the order of Life Critical Care Corporation in
the amount of $______ in accordance with the terms of this
Representative's Warrant; or
[ ] herewith tenders this Representative's Warrant for
___________ shares of Common Stock pursuant to the net
issuance exercise provisions of Section 2(b) of this
Representative's Warrant.
Please issue a certificate or certificates for such shares of
Common Stock in the name of, and pay any cash for any fractional share to:
Name ____________________________
____________________________
____________________________
____________________________
(Please print Name, Address
and Social Security No.)
Signature _______________________
Note: The above signature should
correspond exactly with the
name on the first page of
this Warrant Certificate or
with the name of the
assignee appearing in the
assignment form below.
If said number of shares shall not be all the shares
purchasable under the within Representative's Warrant, a new Representative's
Warrant is to be issued in the name of the said undersigned for the balance
remaining of the shares purchasable thereunder.
15
TRANSFER FORM
(To be signed only upon transfer of Representative's Warrant)
For value received, the undersigned hereby sells, assigns and transfers
unto _______________________________ the right to purchase shares of Common
Stock represented by the foregoing Representative's Warrant to the extent of
______________ shares of Common Stock, and appoints __________________________
attorney to transfer such rights on the books of __________________________,
with full power of substitution.
Dated: ______________________ By:______________________________
______________________________
______________________________
Address
In the presence of:
--------------------------------
