EXHIBIT 4.5
OPTION TO PURCHASE COMMON STOCK
THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES
LAWS OF ANY STATE AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH
ACT AND APPLICABLE STATE SECURITIES LAWS OR AN APPLICABLE
EXEMPTION TO THE REGISTRATION REQUIREMENTS OF SUCH ACT OR SUCH
LAWS.
WARRANT
To Purchase 3,000,000 Shares of Common Stock of
PETMED EXPRESS, INC.
THIS IS TO CERTIFY THAT, TRICON HOLDINGS, LLC, a Florida
limited liability company, or registered assigns (the "Holder"),
is entitled, at any time prior to the Expiration Date (as
hereinafter defined), to purchase from PETMED EXPRESS, INC., a
Florida corporation (the "Company"), Three Million (3,000,000)
shares of Common Stock (as hereinafter defined and subject to
adjustment as provided herein), in whole or in part, at a
purchase price of Thirty-Three Cents ($0.33) per share (subject
to adjustment as provided herein), all on the terms and
conditions and pursuant to the provisions hereinafter set forth.
1. DEFINITIONS
As used in this Warrant, the following terms have the
respective meanings set forth below:
"Additional Shares of Common Stock" shall mean all shares of
Common Stock issued by the Company after the date hereof, other
than Warrant Stock.
"Adjustment Period" shall mean the period of five (5)
consecutive Trading Days preceding the date as of which the Fair
Market Value of a security is to be determined.
"Board of Directors" shall mean the board of directors of
the Company.
"Business Day" shall mean any day that is not a Saturday or
Sunday or a day on which banks are required or permitted to be
closed in the State of New York.
"Commission" shall mean the Securities and Exchange
Commission or any other federal agency then administering the
Securities Act and other federal securities laws.
"Common Stock" shall mean (except where the context
otherwise indicates) the Common Stock, par value $0.001 per
share, of the Company as constituted on the date hereof, and any
capital stock into which such Common Stock may thereafter be
changed, and shall also include (i) capital stock of the Company
of any other class (regardless of how denominated) issued to the
holders of shares of Common Stock upon any reclassification
thereof which is not preferred as to dividends or assets over any
other class of stock of the Company and which is not subject to
redemption and (ii) shares of common stock or other equity
securities of any successor or acquiring corporation (as
described in Section 4.7) received by or distributed to the
holders of Common Stock of the Company in the circumstances
contemplated by Section 4.7.
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Exhibit 4.5
"Convertible Securities" shall mean evidences of
indebtedness, shares of stock or other securities which are
convertible into or exchangeable or exercisable, with or without
payment of additional consideration in cash or property, for
Additional Shares of Common Stock, either immediately or upon the
occurrence of a specified date or a specified event.
"Current Market Price" when used with reference to shares of
Common Stock or other securities on any date, shall mean the
closing price per share of Common Stock or such other securities
on such date and, when used with reference to shares of Common
Stock or other securities for any period shall mean the average
of the daily closing prices per share of Common Stock or such
other securities for such period. The closing price for each day
shall be the last quoted bid price in the over-the-counter
market, as reported by the Nasdaq Stock Market (the "NASDAQ") or
such other system then in use, or, if on any such date the Common
Stock or such other securities are not quoted by any such
organization, the closing bid price as furnished by a
professional market maker making a market in the Common Stock or
such other securities selected by the Board of Directors. If the
Common Stock is listed or admitted to trading on a national
securities exchange, the closing price shall be the closing bid
price, regular way, as reported in the principal consolidated
transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange or, if the
Common Stock or such other securities are not listed or admitted
to trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with respect
to securities listed on the principal national securities
exchange on which the Common Stock or such other securities are
listed or admitted to trading. If the Common Stock or such other
securities are not publicly held or so listed or publicly traded,
"Current Market Price" shall mean the Fair Market Value per share
of Common Stock or of such other securities as determined jointly
by the Board of Directors and the Holders; provided that if such
parties are unable to reach agreement after twenty (20) Business
Days, such Fair Market Value shall be based on an opinion of an
independent investment banking firm with experience in the pet
veterinary and health industry acceptable to the Holders, which
opinion may be based on such assumptions as such firm shall deem
to be necessary and appropriate.
"Current Warrant Price" shall mean, in respect of a share of
Common Stock at any date herein specified, the price at which a
share of Common Stock may be purchased pursuant to this Warrant
on such date, which shall initially be Thirty-Three Cents
($0.33).
"Excluded Securities" shall mean (i) Additional Shares of
Common Stock issuable or issued to employees, outside directors
or consultants of the Company directly or pursuant to any
existing or future stock option plan or stock incentive plan of
the Company; and (ii) Additional Shares of Common Stock issued or
issuable as direct consideration for the acquisition by the
Company of capital stock or assets of another business entity or
in connection with a merger or consolidation to the extent such
issuances are approved by a majority of the members of the Board
of Directors that are not employees of the Company.
"Expiration Date" shall mean 5:00 p.m., New York time on
____________, 2005.
"Fair Market Value" shall mean, as to shares of Common Stock
or any other class of capital stock or securities of the Company
or any other issuer which are publicly traded, the average of the
Current Market Prices of such shares of securities for each day
of the Adjustment Period. The "Fair Market Value" of any
security which is not publicly traded or of any other property
shall mean the fair value thereof as determined by an independent
investment banking or appraisal firm experienced in the valuation
of such securities or property selected in good faith by the
Board of Directors or a committee thereof and acceptable to the
Holder.
"Holder" shall mean the Person in whose name this Warrant is
registered on the books of the Company maintained for such
purpose. "Holders" shall mean, collectively, each Holder of a
Warrant, in the event of any division of this Warrant.
"Other Property" shall have the meaning set forth in Section
4.7.
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Exhibit 4.5
"Outstanding" shall mean, when used with reference to Common
Stock, at any date as of which the number of shares thereof is to
be determined, all issued shares of Common Stock, except shares
then owned or held by or for the account of the Company or any
subsidiary thereof, and shall include all shares issuable in
respect of outstanding scrip or any certificates representing
fractional interests in shares of Common Stock. For the purposes
of Sections 4.3, 4.4, 4.5 and 4.6, Common Stock Outstanding shall
also include all shares of Common Stock issuable in respect of
options or warrants to purchase, or securities convertible into,
shares of Common Stock, the exercise or conversion price of which
is less than the Current Market Price as of any date on which the
number of shares of Common Stock Outstanding is to be determined.
"Permitted Issuances" shall mean the issuance or reissuance
of any shares of Common Stock (whether treasury shares or newly
issued shares) pursuant to (i) a dividend or distribution on, or
subdivision, combination or reclassification of, the outstanding
shares of Common Stock requiring an adjustment in the conversion
ratio pursuant to Section 4.1, or (ii) issuances of Excluded
Securities.
"Person" shall mean any individual, firm, corporation,
partnership or other entity, and shall include any successor by
merger or otherwise of such entity.
"Registration Rights Agreement" shall mean the registration
rights agreement, dated as of the date hereof, among the Company
and the Holder.
"Securities Act" shall mean the Securities Act of 1933, as
amended, or any similar federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall
be in effect at the time.
"Subscription Agreement" shall mean that certain
Subscription Agreement entered into on even date herewith by the
Company and the Holder, and pursuant to which the Company issued
this Warrant.
"Trading Day" means a Business Day or, if the Common Stock
is listed or admitted to trading on any national securities
exchange or automated quotation system, a day on which such
securities exchange or automated quotation system is open for the
transaction of business.
"Transfer" shall mean any disposition of any Warrant or
Warrant Stock or of any interest in either thereof.
"Warrant Price" shall mean an amount equal to the product of
(i) the number of shares of Common Stock being purchased upon
exercise of this Warrant pursuant to Section 2.1, multiplied by
(ii) the Current Warrant Price as of the date of such exercise.
"Warrant Stock" shall mean the shares of Common Stock
purchased by the Holders of the Warrants upon the exercise
thereof.
2. EXERCISE OF WARRANT
2.1 Manner of Exercise. At any time or from time to time
from and after the date hereof and until 5:00 P.M., New York
time, on the Expiration Date, Holder may exercise this Warrant,
on any Business Day, for all or any part of the number of shares
of Common Stock purchasable hereunder.
2.2 In order to exercise this Warrant, in whole or in part,
Holder shall deliver to the Company at its principal office at
0000 XX 00xx Xxxxxx, Xxxxxxx Xxxxx, Xxxxxxx 00000 (i) a written
notice of Holder's election to exercise this Warrant, which
notice shall specify the number of shares of Common Stock to be
purchased, (ii) payment of the Warrant Price and (iii) this
Warrant. Such notice shall be substantially in the form appearing
at the end of this Warrant as Exhibit A, duly executed by Holder.
Upon receipt of the items specified in the second preceding
sentence, the Company shall execute or cause to be executed and
deliver or cause to be delivered to Holder a certificate or
certificates representing the aggregate number of full shares of
Common Stock issuable upon such exercise, together with cash in
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Exhibit 4.5
lieu of any fraction of a share, as hereinafter provided. The
stock certificate or certificates so delivered shall be in such
denomination or denominations as Holder shall request in the
notice and shall be registered in the name of Holder or, subject
to Section 9, such other name as shall be designated in the
notice. This Warrant shall be deemed to have been exercised and
such certificate or certificates shall be deemed to have been
issued, and Holder or any other Person so designated shall be
deemed to have become a holder of record of such shares for all
purposes, as of the date the notice, together with the Warrant
Price and this Warrant, are received by the Company as described
above. If this Warrant shall have been exercised in part, the
Company shall, at the time of delivery of the certificate or
certificates representing Warrant Stock, deliver to Holder a new
Warrant evidencing the right of Holder to purchase the
unpurchased shares of Common Stock called for by this Warrant,
which new Warrant shall in all other respects be identical with
this Warrant, or, at the request of Holder, appropriate notation
may be made on this Warrant and the same returned to Holder.
Payment of the Warrant Price shall be made at the option of
Holder by certified or official bank check, and, in either case,
specifying the number of shares of Common Stock to be purchased,
during normal business hours on any Business Day.
2.3 Payment of Taxes. All shares of Common Stock issuable
upon the exercise of this Warrant shall be validly issued, fully
paid and nonassessable and without any preemptive rights. The
Company shall pay all expenses in connection with, and all taxes
and other governmental charges that may be imposed with respect
to, the issue or delivery thereof (other than transfer taxes
payable in connection with issuing the Warrant Stock in a name
other than that of the Holder).
2.4 Fractional Shares. The Company shall not be required
to issue a fractional share of Common Stock upon exercise of this
Warrant. As to any fraction of a share which Holder would
otherwise be entitled to purchase upon such exercise, the Company
shall pay a cash adjustment in respect of such fraction in an
amount equal to the same fraction of the Current Market Price per
share of Common Stock on the date of exercise.
3. TRANSFER, DIVISION AND COMBINATION
3.1 Transfer. Subject to compliance with Sections 9 and
12.4, Transfer of this Warrant and all rights hereunder, in
whole or in part, shall be registered on the books of the Company
to be maintained for such purpose, upon surrender of this Warrant
at the principal office of the Company referred to in Section
2.1, together with a written assignment of this Warrant
substantially in the form of Exhibit B hereto duly executed by
Holder and funds sufficient to pay any transfer taxes payable
upon the making of such Transfer. Upon such surrender and, if
required, such payment, the Company shall, subject to Sections 9
and 12.4, execute and deliver a new Warrant or Warrants in the
name of the assignee or assignees and in the denomination
specified in such instrument of assignment, and shall issue to
the assignor a new Warrant evidencing the portion of this Warrant
not so assigned, and this Warrant shall promptly be canceled. A
Warrant, if properly assigned in compliance with Sections 9 and
12.4, may be exercised by a new Holder for the purchase of shares
of Common Stock without having a new Warrant issued.
3.2 Division and Combination. Subject to Sections 9 and
12.4, this Warrant may be divided into multiple Warrants or
combined with other Warrants upon presentation hereof at the
aforesaid office or agency of the Company, together with a
written notice specifying the names and denominations in which
new Warrants are to be issued, signed by Holder. Subject to
compliance with Section 3.1 and with Sections 9 and 12.4, as to
any Transfer which may be involved in such division or
combination, the Company shall execute and deliver a new Warrant
or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice.
3.3 Expenses. The Company shall prepare, issue and deliver
at its own expense (other than transfer taxes) the new Warrant or
Warrants under this Section 3.
3.4 Maintenance of Books. The Company agrees to maintain,
at its aforesaid office, books for the registration and the
registration of Transfer of the Warrants.
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Exhibit 4.5
4. ADJUSTMENTS
4.1 The number of shares of Common Stock for which this
Warrant is exercisable and/or the Current Warrant Price at which
such shares may be purchased upon exercise of this Warrant, shall
be subject to adjustment from time to time as set forth in this
Section 4. The Company shall give each Holder notice of any
event described below which requires an adjustment pursuant to
this Section 4 at the time of such event.
4.2 Stock Dividends, Subdivisions and Combinations. In case
the Company shall at any time or from time to time after the date
hereof (A) take a record of the holders of its Common Stock for
the purpose of entitling them to receive a dividend, or any
distribution, on the outstanding shares of Common Stock in
Additional Shares of Common Stock, (B) subdivide the outstanding
shares of Common Stock, (C) combine the outstanding shares of
Common Stock into a smaller number of shares or (D) issue by
reclassification of the shares of Common Stock any shares of
capital stock of the Company, then (i) the number of shares of
Common Stock for which this Warrant is exercisable immediately
after the occurrence of any such event shall be adjusted to equal
the number of shares of Common Stock which a record holder of the
same number of shares of Common Stock for which this Warrant is
exercisable immediately prior to the occurrence of such event
would own or be entitled to receive after the happening of such
event, and (ii) the Current Warrant Price per share shall be
adjusted to equal the quotient of (A) the Current Warrant Price
multiplied by the number of shares of Common Stock for which this
Warrant is exercisable immediately prior to the adjustment,
divided by (B) the number of shares for which this Warrant is
exercisable immediately after such adjustment. An adjustment
made pursuant to this Section 4.1 shall become effective (x) in
the case of any such dividend or distribution, immediately after
the close of business on the record date for the determination of
holders of shares of Common Stock entitled to receive such
dividend or distribution, or (y) in the case of such subdivision,
reclassification or combination, at the close of business on the
day upon which such corporate action becomes effective.
4.3 Certain Other Distributions. If the Company shall at
any time or from time to time after the date hereof declare,
order, pay or make a dividend or other distribution of:
(a) cash, except that the provisions of this Section 4.2
shall not apply to any dividend or distribution of cash to the
extent such dividend or distribution is payable out of
consolidated earnings or retained earnings,
(b) any evidences of its indebtedness, any shares of its
stock or any other securities or property of any nature
whatsoever by way of dividend (other than cash, Convertible
Securities or Additional Shares of Common Stock), or
(c) any warrants or other rights to subscribe for or
purchase any evidences of its indebtedness, any shares of its
stock or any other securities or property of any nature
whatsoever (other than cash, Convertible Securities or Additional
Shares of Common Stock), then (i) the number of shares of Common
Stock for which this Warrant is exercisable shall be adjusted to
equal the product of the number of shares of Common Stock for
which this Warrant is exercisable immediately prior to such
adjustment multiplied by a fraction (A) the numerator of which
shall be the Current Market Price per share of Common Stock for
the period of twenty (20) Trading Days preceding such adjustment
and (B) the denominator of which shall be such Current Market
Price per share of Common Stock less the Fair Market Value per
share of Common Stock of any such dividend or distribution and
(ii) the Current Warrant Price shall be adjusted to equal the
quotient of (A) the Current Warrant Price multiplied by the
number of shares of Common Stock for which this Warrant is
exercisable immediately prior to the adjustment, divided by (B)
the number of shares for which this Warrant is exercisable
immediately after such adjustment. A reclassification of the
Common Stock (other than a change in par value, or from par value
to no par value or from no par value to par value) into shares of
Common Stock and shares of any other class of stock shall be
deemed a distribution by the Company to the holders of its Common
Stock of such shares of such other class of stock within the
meaning of this Section 4.2 and, if the outstanding shares of
Common Stock shall be changed into a larger or smaller number of
shares of Common Stock as a part of such reclassification, then
such change shall be deemed a subdivision or combination, as the
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Exhibit 4.5
case may be, of the outstanding shares of Common Stock within the
meaning of Section 4.1.
4.4 Issuance of Additional Shares of Common Stock. If at
any time the Company shall (except as hereinafter provided) issue
or sell any Additional Shares of Common Stock, other than
Permitted Issuances, in exchange for consideration in an amount
per Additional Share of Common Stock less than the Current Market
Price of the Common Stock at the time the Additional Shares of
Common Stock are issued, then (i) the Current Warrant Price as to
the number of shares for which this Warrant is exercisable prior
to such adjustment shall be reduced to a price determined by
multiplying the Current Warrant Price by a fraction, the
numerator of which shall be the sum of (A) the total number of
shares of Common Stock Outstanding immediately prior to such
issuance or sale and (B) the number of shares of Common Stock
which the consideration received for the total number of
Additional Shares of Common Stock being issued or sold would
purchase at the Current Market Price, and the denominator of
which is the sum of (X) the number of shares of Common Stock
Outstanding immediately prior to such issuance or sale and (Y)
the number of Additional Shares of Common Stock being issued or
sold and (ii) the number of shares of Common Stock for which this
Warrant is exercisable shall be adjusted to equal the product
obtained by multiplying the Current Warrant Price in effect
immediately prior to such issue or sale by the number of shares
of Common Stock for which this Warrant is exercisable immediately
prior to such issue or sale and dividing the product thereof by
the Current Warrant Price resulting from the adjustment made
pursuant to clause (i) above.
4.5 Issuance of Warrants or Other Rights. If at any time
the Company shall take a record of the holders of its Common
Stock for the purpose of entitling them to receive a distribution
of, or shall in any manner (whether directly or by assumption in
a merger in which the Company is the surviving corporation) issue
or sell, any warrants or other rights to subscribe for or
purchase any Additional Shares of Common Stock or any Convertible
Securities, whether or not the rights to exchange or convert
thereunder are immediately exercisable, and the price per share
for which Common Stock is issuable upon the exercise of such
Warrants or other rights or upon conversion or exchange of such
Convertible Securities shall be less than the Current Market
Price in effect immediately prior to the time of such issue or
sale, then the number of shares for which this Warrant is
exercisable and the Current Warrant Price shall be adjusted as
provided in Section 4.3 on the basis that the maximum number of
Additional Shares of Common Stock issuable pursuant to all such
warrants or other rights or necessary to effect the conversion or
exchange of all such Convertible Securities shall be deemed to
have been issued and outstanding and the Company shall have
received all of the consideration payable therefor, if any, as of
the date of the actual issuance of the number of shares for which
this Warrant is exercisable and such warrants or other rights. No
further adjustments of the Current Warrant Price shall be made
upon the actual issue of such Common Stock or of such Convertible
Securities upon exercise of such warrants or other rights or upon
the actual issue of such Common Stock upon such conversion or
exchange of such Convertible Securities. On the expiration of
any such warrants or other rights or the termination of any such
right to convert or exchange such Convertible Securities, the
Current Warrant Price then in effect hereunder shall forthwith be
increased to the Current Warrant Price which would have been in
effect at the time of such expiration or termination had such
warrants, rights or Convertible Securities so expired or
terminated never been issued.
4.6 Issuance of Convertible Securities. If at any time the
Company shall take a record of the holders of its Common Stock
for the purpose of entitling them to receive a distribution of,
or shall in any manner (whether directly or by assumption in a
merger in which the Company is the surviving corporation) issue
or sell, any Convertible Securities, whether or not the rights to
exchange or convert thereunder are immediately exercisable, and
the price per share for which Common Stock is issuable upon such
conversion or exchange shall be less than the Current Market
Price in effect immediately prior to the time of such issue or
sale, then the number of shares for which this Warrant is
exercisable and the Current Warrant Price shall be adjusted as
provided in Section 4.3 on the basis that the maximum number of
Additional Shares of Common Stock necessary to effect the
conversion or exchange of all such Convertible Securities shall
be deemed to have been issued and outstanding and the Company
shall have received all of the consideration payable therefor, if
any, as of the date of actual issuance of such Convertible
Securities. No adjustment of the number of shares for which this
Warrant is exercisable and the Current Warrant Price shall be
made under this Section 4.5 upon the issuance of any Convertible
Securities which are issued pursuant to the exercise of any
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Exhibit 4.5
warrants or other subscription or purchase rights therefor, if
any such adjustment shall previously have been made upon the
issuance of such warrants or other rights pursuant to Section
4.4. No further adjustments of the number of shares for which
this Warrant is exercisable and the Current Warrant Price shall
be made upon the actual issue of such Common Stock upon
conversion or exchange of such and, if any issue or sale of
such is made upon exercise of any warrant or other right to
subscribe for or to purchase any such for which adjustments of
the number of shares for which this Warrant is exercisable and
the Current Warrant Price have been or are to be made pursuant to
other provisions of this Section 4, no further adjustments of the
number of shares for which this Warrant is exercisable and the
Current Warrant Price shall be made by reason of such issue or
sale. On the expiration of any such warrants or other rights or
the termination of any such right to convert or exchange such,
the Current Warrant Price then in effect hereunder shall
forthwith be increased to the Current Warrant Price which would
have been in effect at the time of such expiration or
termination had such warrants, rights or Convertible Securities
so expired or terminated never been issued.
4.7 Other Provisions Applicable to Adjustments under this
Section. The following provisions shall be applicable to the
making of adjustments of the number of shares of Common Stock for
which this Warrant is exercisable and the Current Warrant Price
provided for in this Section 4:
(a) Computation of Consideration. To the extent that any
Additional Shares of Common Stock or any Convertible Securities
or any warrants or other rights to subscribe for or purchase any
Additional Shares of Common Stock or any Convertible Securities
shall be issued for cash consideration, the consideration
received by the Company therefor shall be the amount of the cash
received by the Company therefor, or, if such Additional Shares
of Common Stock or are offered by the Company for subscription,
the subscription price, or, if such Additional Shares of Common
Stock or are sold to underwriters or dealers for public offering
without a subscription offering, the public offering price (in
any such case subtracting any amounts paid or receivable for
accrued interest or accrued dividends and without taking into
account any compensation, discounts or expenses paid or incurred
by the Company for and in the underwriting of, or otherwise in
connection with, the issuance thereof). To the extent that such
issuance shall be for a consideration other than cash, then,
except as herein otherwise expressly provided, the amount of such
consideration shall be deemed to be the Fair Market Value of such
consideration at the time of such issuance. In case any
Additional Shares of Common Stock or any Convertible Securities
or any warrants or other rights to subscribe for or purchase such
Additional Shares of Common Stock or shall be issued in
connection with any merger in which the Company issues any
securities, the amount of consideration therefor shall be deemed
to be the Fair Market Value of such portion of the assets and
business of the nonsurviving corporation as such Board of
Directors in good faith shall determine to be attributable to
such Additional Shares of Common Stock, Convertible Securities,
warrants or other rights, as the case may be. The consideration
for any Additional Shares of Common Stock issuable pursuant to
any warrants or other rights to subscribe for or purchase the
same shall be the consideration received by the Company for
issuing such warrants or other rights plus the additional
consideration payable to the Company upon exercise of such
warrants or other rights. The consideration for any Additional
Shares of Common Stock issuable pursuant to the terms of any
shall be the consideration received by the Company for issuing
warrants or other rights to subscribe for or purchase such, plus
the consideration paid or payable to the Company in respect of
the subscription for or purchase of such, plus the additional
consideration, if any, payable to the Company upon the exercise
of the right of conversion or exchange in such Convertible
Securities. In case of the issuance at any time of any
Additional Shares of Common Stock or Convertible Securities in
payment or satisfaction of any dividends upon any class of stock
other than Common Stock, the Company shall be deemed to have
received for such Additional Shares of Common Stock or
Convertible Securities a consideration equal to the amount of
such dividend so paid or satisfied. If Additional Shares of
Common Stock are sold as a unit with other securities or rights
of value, the aggregate consideration received for such
Additional Shares of Common Stock shall be deemed to be net of
the Fair Market Value of such other securities or rights of
value.
(b) When Adjustments to Be Made. The adjustments required
by this Section 4 shall be made whenever and as often as any
specified event requiring an adjustment shall occur, except that
any adjustment of the number of shares of Common Stock for which
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Exhibit 4.5
this Warrant is exercisable that would otherwise be required may
be postponed (except in the case of a subdivision or combination
of shares of the Common Stock, as provided for in Section 4.1) up
to, but not beyond the date of exercise if such adjustment either
by itself or with other adjustments not previously made results
in an increase or decrease of less than one percent (1%) of the
shares of Common Stock for which this Warrant is exercisable
immediately prior to the making of such adjustment; provided,
however, that such adjustment must result in an adjustment of One
Cent ($0.01) or more. Any adjustment representing a change of
less than such minimum amount (except as aforesaid) which is
postponed shall be carried forward and made as soon as such
adjustment, together with other adjustments required by this
Section 4 and not previously made, would result in a minimum
adjustment or on the date of exercise. For the purpose of any
adjustment, any specified event shall be deemed to have occurred
at the close of business on the date of its occurrence.
(c) ractional Interests. In computing adjustments under
this Section 4, fractional interests in Common Stock shall be
taken into account to the nearest 1/100th of a share.
(d) When Adjustment Not Required. If the Company shall
take a record of the holders of its Common Stock for the purpose
of entitling them to receive a dividend or distribution or
subscription or purchase rights and shall, thereafter and before
the distribution to stockholders thereof, legally abandon its
plan to pay or deliver such dividend, distribution, subscription
or purchase rights, then thereafter no adjustment shall be
required by reason of the taking of such record and any such
adjustment previously made in respect thereof shall be rescinded
and annulled.
(e) Escrow of Warrant Stock. If, after any property
becomes distributable pursuant to this Section 4 by reason of the
taking of any record of the holders of Common Stock, but prior to
the occurrence of the event for which such record is taken,
Holder exercises this Warrant, any Additional Shares of Common
Stock issuable upon exercise by reason of such adjustment shall
be deemed the last shares of Common Stock for which this Warrant
is exercised (notwithstanding any other provision to the contrary
herein) and such shares or other property shall be held in escrow
for Holder by the Company to be issued to Holder when and to the
extent that the event actually takes place, upon payment of the
then Current Warrant Price. Notwithstanding any other provision
to the contrary herein, if the event for which such record was
taken fails to occur or is rescinded, then such escrowed shares
shall be canceled by the Company and escrowed property returned.
4.8 Reorganization, Reclassification, Merger, Consolidation
or Disposition of Assets. In case the Company shall (i)
reorganize its capital, (ii) reclassify its capital stock, (iii)
consolidate or merge with or into another corporation (where the
Company is not the surviving corporation or where there is a
change in or distribution with respect to the Common Stock of the
Company), or (iv) sell, transfer or otherwise dispose of all or
substantially all its property, assets or business to another
corporation and, pursuant to the terms of such reorganization,
reclassification, merger, consolidation or disposition of assets,
shares of Common Stock of the successor or acquiring corporation,
or any cash, shares of stock or other securities or property of
any nature whatsoever (including warrants or other subscription
or purchase rights) in addition to or in lieu of Common Stock of
the successor or acquiring corporation ("Other Property"), are to
be received by or distributed to the holders of Common Stock,
then Holder shall have the right thereafter to receive, upon
exercise of this Warrant and payment of the Warrant Price, the
number of shares of common stock of the successor or acquiring
corporation or of the Company, if it is the surviving
corporation, and Other Property receivable upon or as a result of
such reorganization, reclassification, merger, consolidation or
disposition of assets by a holder of the number of shares of
Common Stock for which this Warrant is exercisable immediately
prior to such event. In case of any such reorganization,
reclassification, merger, consolidation or disposition of assets,
the successor or acquiring corporation (if other than the
Company) shall expressly assume the due and punctual observance
and performance of each and every covenant and condition of this
Warrant to be performed and observed by the Company and all the
obligations and liabilities hereunder, subject to such
modifications as may be deemed appropriate (as determined by
resolution of the Board of Directors) in order to provide for
adjustments of shares of the Common Stock for which this Warrant
is exercisable which shall be as nearly equivalent as practicable
to the adjustments provided for in this Section 4. For purposes
of this Section 4.7, "common stock of the successor or acquiring
corporation" shall include stock of such corporation of any class
8
Exhibit 4.5
which is not preferred as to dividends or assets over any other
class of stock of such corporation and which is not subject to
redemption and shall also include any evidences of indebtedness,
shares of stock or other securities which are convertible into or
exchangeable for any such stock, either immediately or upon the
arrival of a specified date or the happening of a specified event
and any warrants or other rights to subscribe for or purchase any
such stock. Notwithstanding the foregoing, in the event of a
transaction described in clauses (iii) or (iv) of this Section
4.7, to the extent such transaction is a bona fide unaffiliated
third party transaction, the Company may require that the
Warrants be converted into, for each share of Warrant Stock
issuable upon the exercise of a Warrant, the consideration
received in respect of a share of the Company's Common Stock in
such transaction less with respect to each share of Warrant Stock
issuable upon exercise of a Warrant, the Current Warrant Price
thereof. The foregoing provisions of this Section 4.7 shall
similarly apply to successive reorganizations, reclassifications,
mergers, consolidations or disposition of assets.
4.9 Certain Limitations. Notwithstanding anything herein
to the contrary, the Company agrees not to enter into any
transaction which, by reason of any adjustment hereunder, would
cause the Current Warrant Price to be less than the par value per
share of Common Stock.
5. NOTICES TO WARRANT HOLDERS
5.1 Notice of Adjustments; Change in Warrant Status.
Whenever the number of shares of Common Stock for which this
Warrant is exercisable, or whenever the price at which a share of
such Common Stock may be purchased upon exercise of the Warrants,
shall be adjusted pursuant to Section 2.1 or Section 4, the
Company shall forthwith prepare a certificate to be executed by
the chief financial officer of the Company setting forth, in
reasonable detail, the event requiring the adjustment and the
method by which such adjustment was calculated (including a
description of the basis on which the Board of Directors
determined the Fair Market Value of any evidences of
indebtedness, shares of stock, other securities or property or
warrants or other subscription or purchase rights referred to in
Section 4.2 or 4.6(a)), specifying the number of shares of Common
Stock for which this Warrant is exercisable and (if such
adjustment was made pursuant to Section 4.7) describing the
number and kind of any other shares of stock or Other Property
for which this Warrant is exercisable, and any change in the
purchase price or prices thereof, after giving effect to such
adjustment or change. The Company shall promptly cause a signed
copy of such certificate to be delivered to each Holder in
accordance with Section 12.2. The Company shall keep at its
principal office copies of all such certificates and cause the
same to be available for inspection at said office during normal
business hours by any Holder or any prospective purchaser of a
Warrant designated by a Holder thereof.
5.2 Notice of Corporate Action. If at any time
(a) the Company shall take a record of the holders of
its Common Stock for the purpose of entitling them to receive a
dividend (other than a cash dividend which is payable out of
earnings or earned surplus legally available for the payment of
dividends under the laws of the jurisdiction of incorporation of
the Company) or other distribution, or any right to subscribe for
or purchase any evidences of its indebtedness, any shares of
stock of any class or any other securities or property, or to
receive any other right, or
(b) there shall be any capital reorganization of the
Company, any reclassification or recapitalization of the capital
stock of the Company or any consolidation or merger of the
Company with, or any sale, transfer or other disposition of all
or substantially all the property, assets or business of the
Company to, another corporation, or
(c) there shall be a voluntary or involuntary
dissolution, liquidation or winding up of the Company;
(d) then, in any one or more of such cases, the
Company shall give to Holder (i) at least twenty (20) days' prior
written notice of the date on which a record date shall be
selected for such dividend, distribution or right or for
determining rights to vote in respect of any such reorganization,
reclassification, merger, consolidation, sale, transfer,
9
Exhibit 4.5
disposition, dissolution, liquidation or winding up, and (ii) in
the case of any such reorganization, reclassification, merger,
consolidation, sale, transfer, disposition, dissolution,
liquidation or winding up, at least twenty (20) days' prior
written notice of the date when the same shall take place. Such
notice in accordance with the foregoing clause also shall specify
(i) the date on which any such record is to be taken for the
purpose of such dividend, distribution or right, the date on
which the holders of Common Stock shall be entitled to any such
dividend, distribution or right, and the amount and character
thereof, and (ii) the date on which any such reorganization,
reclassification, merger, consolidation, sale, transfer,
disposition, dissolution, liquidation or winding up is to take
place and the time, if any such time is to be fixed, as of which
the holders of Common Stock shall be entitled to exchange their
shares of Common Stock for securities or other property
deliverable upon such reorganization, reclassification, merger,
consolidation, sale, transfer, disposition, dissolution,
liquidation or winding up. Each such written notice shall be
sufficiently given if addressed to Holder at the last address of
Holder appearing on the books of the Company and delivered in
accordance with Section 12.2.
6. RIGHTS OF HOLDERS
6.1 No Impairment. The Company shall not by any action,
including, without limitation, amending its Articles of
Incorporation or comparable governing instruments or through any
reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary
action, avoid or seek to avoid the observance or performance of
any of the terms of this Warrant, but will at all times in good
faith assist in the carrying out of all such terms and in the
taking of all such actions as may be necessary or appropriate to
protect the rights of Holder against impairment. Without
limiting the generality of the foregoing, the Company will (a)
not increase the par value of any shares of Common Stock
receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise immediately prior to such
increase in par value, (b) take all such action as may be
necessary or appropriate in order that the Company may validly
and legally issue fully paid and nonassessable shares of Common
Stock upon the exercise of this Warrant, and (c) use its best
efforts to obtain all such authorizations, exemptions or consents
from any public regulatory body having jurisdiction thereof as
may be necessary to enable the Company to perform its obligations
under this Warrant.
Upon the request of Holder, the Company will at any
time during the period this Warrant is outstanding acknowledge in
writing, in form reasonably satisfactory to Holder, the
continuing validity of this Warrant and the obligations of the
Company hereunder.
7. RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION
WITH OR APPROVAL OF ANY GOVERNMENTAL AUTHORITY
7.1 From and after the date hereof, the Company shall at
all times reserve and keep available for issue upon the exercise
of Warrants such number of its authorized but unissued shares of
Common Stock as will be sufficient to permit the exercise in full
of all outstanding Warrants. All shares of Common Stock which
shall be so issuable, when issued upon exercise of any Warrant
and payment therefor in accordance with the terms of such
Warrant, shall be duly and validly issued and fully paid and
nonassessable, and not subject to preemptive rights.
1.
7.2 Before taking any action which would cause an
adjustment reducing the Current Warrant Price below the then par
value, if any, of the shares of Common Stock issuable upon
exercise of the Warrants, the Company shall take any corporate
action which may be necessary in order that the Company may
validly and legally issue fully paid and nonassessable shares of
such Common Stock at such adjusted Current Warrant Price.
8. TAKING OF RECORD; STOCK AND WARRANT TRANSFER BOOKS
8.1 In the case of all dividends or other distributions by
the Company to the holders of its Common Stock with respect to
which any provision of Section 4 refers to the taking of a record
of such holders, the Company will in each such case take such a
record and will take such record as of the close of business on a
Business Day. The Company will not at any time, except upon
dissolution, liquidation or winding up of the Company, close its
10
Exhibit 4.5
stock transfer books or Warrant transfer books so as to result in
preventing or delaying the exercise or Transfer of any Warrant.
9. RESTRICTIONS ON TRANSFERABILITY
9.1 The Warrants and the Warrant Stock shall not be
transferred, hypothecated or assigned before satisfaction of the
conditions specified in this Section 9, which conditions are
intended to ensure compliance with the provisions of the
Securities Act with respect to the Transfer of any Warrant or any
Warrant Stock. Holder, by acceptance of this Warrant, agrees to
be bound by the provisions of this Section 9.
9.2 Restrictive Legend. Except as otherwise provided in
this Section 9, each Warrant and each certificate for Warrant
Stock initially issued upon the exercise of a Warrant, and each
certificate for Warrant Stock issued to any subsequent transferee
of any such certificate, shall be stamped or otherwise imprinted
with the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED. THE SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED OR
OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH SUCH
ACT."
9.3 Registration Rights. The Holders shall have the
registration rights set forth in the Registration Rights
Agreement.
10. LOSS OR MUTILATION
10.1 Upon receipt by the Company from any Holder of evidence
reasonably satisfactory to it of the ownership of and the loss,
theft, destruction or mutilation of this Warrant and indemnity
reasonably satisfactory to it, and in case of mutilation upon
surrender and cancellation hereof, the Company will execute and
deliver in lieu hereof a new Warrant of like tenor to such
Holder; provided, in the case of mutilation, no indemnity shall
be required if this Warrant in identifiable form is surrendered
to the Company for cancellation.
11. LIMITATION OF LIABILITY
11.1 No provision hereof, in the absence of affirmative
action by Holder to purchase shares of Common Stock, and no
enumeration herein of the rights or privileges of Holder hereof,
shall give rise to any liability of such Holder for the purchase
price of any Common Stock or as a stockholder of the Company,
whether such liability is asserted by the Company or by creditors
of the Company.
12. MISCELLANEOUS
12.1 Nonwaiver and Expenses. No course of dealing or any
delay or failure to exercise any right hereunder on the part of
Holder shall operate as a waiver of such right or otherwise
prejudice Holder's rights, powers or remedies.
12.2 Notice Generally. Any notice, demand, request,
consent, approval, declaration, delivery or other communication
hereunder to be made pursuant to the provisions of this Warrant
shall be sufficiently given or made if in writing and either
delivered in person with receipt acknowledged or sent by
registered or certified mail, return receipt requested, postage
prepaid, or by a nationally recognized overnight courier or by
facsimile and confirmed by facsimile answerback, addressed as
follows:
(a) If to any Holder or holder of Warrant Stock, at its
last known address appearing on the books of the Company
maintained for such purpose.
11
Exhibit 4.5
(b) If to the Company at:
PetMed Express, Inc.
0000 XX 00xx Xxxxxx
Xxxxxxx Xxxxx, XX 00000
Attention: Xxxx X. Xxxxx, M.D.
Facsimile Number: 954-971-0544
or at such other address as may be substituted by notice given as
herein provided. The giving of any notice required hereunder may
be waived in writing by the party entitled to receive such
notice. Every notice, demand, request, consent, approval,
declaration, delivery or other communication hereunder shall be
deemed to have been duly given or served on the date on which
personally delivered, with receipt acknowledged, sent by
facsimile and confirmed by facsimile answerback, one (1) Business
Day after the same shall have been deposited with a nationally
recognized overnight courier or three (3) Business Days after the
same shall have been deposited in the United States mail.
Failure or delay in delivering copies of any notice, demand,
request, approval, declaration, delivery or other communication
to the Person designated above to receive a copy shall in no way
adversely affect the effectiveness of such notice, demand,
request, approval, declaration, delivery or other communication.
12.3 Remedies. Each Holder and holder of Warrant Stock, in
addition to being entitled to exercise all rights granted by law,
including recovery of damages, will be entitled to specific
performance of its rights under of this Warrant. The Company
agrees that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of the
provisions of this Warrant and hereby agrees to waive the defense
in any action for specific performance that a remedy at law would
be adequate.
12.4 Successors and Permitted Assigns. Subject to the
provisions of Sections 3.1, this Warrant and the rights evidenced
hereby shall inure to the benefit of and be binding upon the
successors of the Company and the successors and permitted
assigns of Holder. The provisions of this Warrant are intended
to be for the benefit of all Holders from time to time of this
Warrant and, with respect to Section 9 hereof, holders of Warrant
Stock, and shall be enforceable by any such Holder or holder of
Warrant Stock.
12.5 Amendment. This Warrant and all other Warrants may be
modified or amended or the provisions hereof waived with the
written consent of the Company and the Holders of the majority of
the outstanding Warrants, provided that no such Warrant may be
modified or amended to reduce the number of shares of Common
Stock for which such Warrant is exercisable or to increase the
price at which such shares may be purchased upon exercise of such
Warrant (before giving effect to any adjustment as provided
therein) without the prior written consent of the Holder thereof.
12.6 Severability. Wherever possible, each provision of
this Warrant shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of
this Warrant shall be prohibited by or invalid under applicable
law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Warrant.
12.7 Headings. The headings used in this Warrant are for
the convenience of reference only and shall not, for any purpose,
be deemed a part of this Warrant.
12.8 Governing Law. This Warrant shall be governed by the
laws of the State of Florida, without regard to the provisions
thereof relating to conflict of laws.
12
Exhibit 4.5
IN WITNESS WHEREOF, the Company has caused this Warrant to
be duly executed and its corporate seal to be impressed hereon
and attested by its Secretary or an Assistant Secretary.
Dated: November 22, 2000
PETMED EXPRESS, INC.
By: /s/ Xxxx Xxxxx, M.D.
---------------------------
Name: Xxxx Xxxxx, M.D.
Title: Chief Executive Officer
Attest:
By: /s/ Xxxx Xxxxx, M.D.
-----------------------------
Name: Xxxx Xxxxx, M.D.
Title: Chief Executive Officer
13
Exhibit 4.5
EXHIBIT A
EXERCISE FORM
[To be executed only upon exercise of Warrant]
Net Issue Exercise _____No ______Yes
The undersigned registered owner of this Warrant irrevocably
exercises this Warrant for the purchase of _____ Shares of Common
Stock of PETMED EXPRESS, INC. and herewith makes payment
therefor, all at the price and on the terms and conditions
specified in this Warrant and requests that certificates for the
shares of Common Stock hereby purchased (and any securities or
other property issuable upon such exercise) be issued in the name
of and delivered to _____________ whose address is
________________ and, if such shares of Common Stock shall not
include all of the shares of Common Stock issuable as provided in
this Warrant, that a new Warrant of like tenor and date for the
balance of the shares of Common Stock issuable hereunder be
delivered to the undersigned.
------------------------------
(Name of Registered Owner)
------------------------------
(Signature of Registered
Owner)
------------------------------
(Street Address)
------------------------------
(City) (State) (Zip Code)
NOTICE: The signature on this subscription must correspond with
the name as written upon the face of the within Warrant
in every particular, without alteration or enlargement
or any change whatsoever.
1
Exhibit 4.5
EXHIBIT B
ASSIGNMENT FORM
FOR VALUE RECEIVED the undersigned registered owner of this
Warrant hereby sells, assigns and transfers unto the Assignee
named below all of the rights of the undersigned under this
Warrant, with respect to the number of shares of Common Stock set
forth below:
Name and Address of Assignee No. of Shares of Common Stock
---------------------------- -----------------------------
and does hereby irrevocably constitute and appoint
________________ attorney-in-fact to register such transfer on
the books of PETMED EXPRESS, INC. maintained for the purpose,
with full power of substitution in the premises.
Dated:______________ Print Name:____________________
Signature:_____________________
Witness:_______________________
NOTICE: The signature on this assignment must correspond with
the name as written upon the face of the within Warrant
in every particular, without alteration or enlargement
or any change whatsoever.
2
Exhibit 4.5
