NEITHER THIS WARRANT NOR ANY SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE
OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE "ACT"), OR
APPLICABLE STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON STOCK ISSUABLE
UPON EXERCISE OF THIS WARRANT MAY NOT BE OFFERED, SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF REGISTRATION UNDER THE ACT OR APPLICABLE STATE
SECURITIES LAWS UNLESS DATAMETRICS CORPORATION (THE "COMPANY") HAS RECEIVED THE
WRITTEN OPINION OF THE COMPANY'S COUNSEL OR OTHER COUNSEL REASONABLY
SATISFACTORY THE COMPANY THAT, AFTER INVESTIGATION OF THE RELEVANT FACTS, SUCH
COUNSEL IS OF THE OPINION THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION
UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS.
No. _______
WARRANT TO PURCHASE COMMON STOCK
DATAMETRICS CORPORATION
VOID AFTER 5:00 P.M., NEW YORK TIME ON AUGUST __, 2004
This certifies that, for value received, XXXXXXX XXXXXXX or his
permissible transferees, designees, successors and assigns (collectively, the
"HOLDER"), is entitled, subject to the terms set forth below, to purchase from
Datametrics Corporation, a Delaware corporation (the "COMPANY"), THE NUMBER OF
SHARES OF THE COMPANY'S COMMON STOCK, PAR VALUE $.0l PER SHARE (THE "COMMON
STOCK"), AS SET FORTH IN ON THE SIGNATURE PAGE HEREOF upon surrender hereof, at
the principal office of the Company referred to below, with the Notice of
Exercise attached hereto duly executed, and simultaneous payment therefor in
lawful money of the United States, or otherwise as hereinafter provided, at the
exercise price as set forth in Section 2 hereof. The number of, and exercise
price for, such shares of Common Stock are subject to adjustment as provided
herein. This Warrant is issued in connection with an agreement between the
Company and Branch Banking and Trust Company for a revolving line of credit in
the amount of $1,500,000.
1. TERM OF WARRANT. Subject to the terms and conditions set forth
herein, this Warrant shall be exercisable, in whole or in part, during the term
commencing on the date hereof (the "WARRANT ISSUE DATE" and terminating on or
before 5:00 p.m., New York time, on August __, 2004 (the "WARRANT EXPIRATION
DATE"). Outstanding Warrants not exercised prior to the Warrant Expiration Date
shall become void and all rights thereunder and all rights in respect thereof
shall cease as of such time.
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2. EXERCISE PRICE. The exercise price shall be $1.10 per share of
Common Stock (the "WARRANT EXERCISE PRICE").
3. EXERCISE OF WARRANT. (a) This Warrant is exercisable by the Holder,
in whole or in part, at any time, or from time to time, during the term hereof
as described in Section 1 hereof, by the surrender of this Certificate and the
Notice of Exercise annexed hereto duly completed and executed on behalf of the
Holder, at the 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), upon payment in cash or by
check acceptable to the Company, for the purchase price of the shares to be
purchased. Upon payment in full of all Notes, this Warrant shall be canceled
automatically as to all shares of Common Stock as to which it is not then
exercisable.
(b) This Warrant shall be deemed to have been exercised
immediately prior to the close of business on the date of its surrender for
exercise as provided in Section 3 (a) hereof, and the person entitled to receive
the shares of Common Stock issuable upon such exercise shall be treated for all
purposes as the holder of record of such shares as of the close of business on
such date. Unless exercised in connection with an underwritten public offering,
as promptly as practicable on or after such date and in any event within ten
(10) days thereafter, the Company at its expense shall issue and deliver to the
person or persons entitled to receive the same a certificate or certificates for
the number of shares issuable upon such exercise. In the event that this Warrant
is exercised in part, the Company at its expense will execute and deliver a new
Warrant of like tenor exercisable for the number of shares for which this
Warrant may then be exercised. In the event of exercise at the time of an
underwritten public offering, the Company will provide instructions as to the
exercise of this Warrant and the issuance of certificates.
4. NO FRACTIONAL SHARES OR SCRIP. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant. In lieu of any fractional share to which the Holder would otherwise be
entitled, the Company shall make a cash payment equal to the exercise price
multiplied by such fraction.
5. REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company, in its sole and absolute discretion, of the loss,
theft, destruction or mutilation of this Warrant and, in the case of loss, theft
or destruction, upon delivery of an indemnity agreement reasonably satisfactory
in form and substance to the Company or, in the case of mutilation, upon
surrender and cancellation of this Warrant, the Company at its expense shall
execute and deliver, in lieu of this Warrant, a new warrant of like tenor and
amount.
6. RIGHTS OF STOCKHOLDERS. The Holder shall not be entitled to vote or
receive dividends or be deemed the holder of Common Stock or any other
securities of the Company that may at any time be issuable on the exercise
hereof for any purpose, nor shall anything contained herein be construed to
confer upon the Holder, as such, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or upon any matter
submitted to stockholders at any meeting thereof, or to give or withhold consent
to any corporate action (whether upon any recapitalization, issuance of stock,
reclassification of stock, consolidation, merger or otherwise) or to receive
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notices of meetings, or to receive dividends or subscription rights or otherwise
until the Warrant shall have been exercised and the shares of Common Stock
purchasable upon the exercise hereof shall have been issued, as provided herein.
7. COMPLIANCE WITH SECURITIES LAWS. (a) The Holder of this Warrant, by
acceptance hereof, acknowledges that the shares of Common Stock to be issued
upon exercise hereof are being acquired solely for the Holder's own account and
not as a nominee for any other party, and for investment, and that the Holder
will not offer, sell or otherwise dispose of any shares of Common Stock to be
issued upon exercise hereof, except under circumstances that will not result in
a violation of the United States Securities Act of 1933, as amended (the "ACT"),
or any foreign or state securities laws. Upon exercise of this Warrant, the
Holder shall, if requested by the Company, confirm in writing, in a form
satisfactory to the Company, that the shares of Common Stock so purchased are
being acquired solely for the Holder's, own account and not as a nominee for any
other party, for investment, and not with a view toward distribution or resale.
(b) All shares of Common Stock issued upon exercise hereof may
be stamped or imprinted with the following legend (in addition to any legend
required by the Act and the securities laws of any state of the United States)
as determined by counsel for the Company:
THESE SHARES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER (THE "ACT"), OR APPLICABLE STATE SECURITIES
LAWS, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED
OF IN THE ABSENCE OF REGISTRATION UNDER THE ACT OR APPLICABLE STATE
SECURITIES LAWS UNLESS DATAMETRICS CORPORATION (THE "COMPANY") HAS
RECEIVED THE WRITTEN OPINION OF THE COMPANY'S COUNSEL OR OTHER COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY THAT, AFTER INVESTIGATION OF THE
RELEVANT FACTS, SUCH COUNSEL IS OF THE OPINION THAT SUCH TRANSACTION
DOES NOT REQUIRE REGISTRATION UNDER THE ACT OR APPLICABLE STATE
SECURITIES LAWS.
8. RESTRICTIONS ON TRANSFER OF UNDERLYING COMMON STOCK. The Holder of
this Warrant by acceptance hereof agrees that the transfer of the shares of
Common Stock issuable upon the exercise of all or any portion of this Warrant is
subject to the provisions of this Warrant, which include certain restrictions on
the transfer of such shares of Common Stock.
9. RESERVATION OF COMMON STOCK. The Company hereby covenants and agrees
that during the term that this Warrant is exercisable, the Company will reserve
from its authorized and unissued shares of Common Stock a sufficient number of
shares to provide for the issuance of Common Stock upon the exercise of this
Warrant and, from time to time, will take all steps necessary to amend its
Certificate of Incorporation to provide a sufficient reserve of shares of Common
Stock issuable upon exercise of the Warrant. The Company further covenants that
all shares that may be issued upon the exercise of rights represented by this
Warrant and payment of
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the exercise price, all as set forth herein, will be free from all taxes, liens
and charges in respect of the issue thereof (other than taxes in respect of any
transfer occurring contemporaneously or otherwise specified herein). The Company
agrees that its issuance of this Warrant shall constitute full authority to its
officers who are charged with the duty of executing stock certificates to
execute and issue the necessary certificates for shares of Common Stock upon the
exercise of this Warrant.
10. NOTICES. (a) Whenever the exercise price or number of shares
purchasable hereunder shall be adjusted pursuant to Section 12 hereof, the
Company shall issue a certificate signed by its Secretary setting forth, in
reasonable detail, the event requiring the adjustment, the amount of the
adjustment, the method by which such adjustment was calculated and the exercise
price and number of shares purchasable hereunder after giving effect to such
adjustment, and shall cause a copy of such certificate to be mailed (by first
class mail, postage prepaid to the Holder of this Warrant.
(b) In case: (i) the Company shall take a record of the
holders of its Common Stock (or other stock or securities at the time receivable
upon the exercise of this Warrant) for the purpose of entitling them to receive
any dividend or other distribution, or any right to subscribe for or purchase
any shares of stock of any class or any other securities, or to receive any
other right; or (ii) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company with or into another corporation, or any sale, lease or
conveyance of all or substantially all of the assets of the Company to another
person; or (iii) of any voluntary dissolution, liquidation or winding-up of the
Company, then, and in each such case, the Company will mail or cause to be
mailed to the Holder a notice specifying, as the case may be, (A) the date on
which a record is to be taken for the purpose of such dividend, distribution or
right, and stating the amount and character of such dividend, distribution or
right, or (B) the date on which such reorganization, reclassification,
consolidation, merger, conveyance, dissolution, liquidation or winding-up is to
take place, and the time, if any is to be fixed, as of which the holders of
record of Common Stock (or such stock or securities at the time receivable upon
the exercise of this Warrant) shall be entitled to exchange their shares of
Common Stock (or such other stock or securities) for securities or other
property deliverable upon such reorganization, reclassification, consolidation,
merger, conveyance, dissolution, liquidation or winding-up. Such notice shall be
mailed at least ten (10) days prior to the date therein specified.
(c) All such notices and communications shall be deemed to
have been received (i) in the case of personal delivery, on the date of such
delivery and (ii) in the case of mailing, on the second business day following
the date of such mailing.
11. AMENDMENTS. (a) Any term of this Warrant may be amended with the
written consent of the Company and the holders of warrants which, if exercised
would then represent not less than a majority of the shares of Common Stock
issuable upon exercise of any and all outstanding warrants for shares of Common
Stock issued by the Company on the date hereof (the "COMMON STOCK WARRANTS"),
even without the specific consent of the Holder. An amendment effected in
accordance with this Section 11 shall be binding upon each holder of any of the
Common Stock Warrants, each future holder of all such Common Stock Warrants, and
the
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Company. The Company shall promptly give notice to all holders of Common Stock
Warrants of any amendment effected in accordance with this Section 11.
(b) No waivers of or exceptions to any term, condition or
provision of this Warrant, in any one or more instances, shall be deemed to be,
or construed as, a further or continuing waiver of any such term, condition or
provision.
12. ADJUSTMENTS; ANTIDILUTION. The exercise prices and the number of
shares purchasable hereunder are subject to adjustment from time to time as
follows:
(a) MERGER, SALE OF ASSETS, ETC. If at any time, while this
Warrant, or any portion thereof, is outstanding and unexpired there shall be (i)
a reorganization (other than a combination, reclassification exchange or
subdivision of shares otherwise provided for herein), (ii) a merger or
consolidation of the Company with or into another corporation in which the
Company is not the surviving person, or a reverse triangular merger in which the
Company is the surviving person but the shares of the Company's capital stock
outstanding immediately prior to the merger are converted by virtue of the
merger into other property, whether in the form of cash, securities or
otherwise, or (iii) a sale or transfer of the Company's properties and assets
as, or substantially as, an entirety to any other person, then, as a part of
such reorganization, merger, consolidation, sale or transfer, lawful provision
shall be made so that the Holder shall thereafter be entitled to receive upon
exercise of this Warrant, during the period specified herein and upon payment of
the exercise price then in effect, the number of shares of stock or other
securities or property of the successor corporation resulting from such
reorganization, merger, consolidation, sale or transfer which a holder of the
shares deliverable upon exercise of this Warrant would have been entitled to
receive in such reorganization, consolidation, merger, sale or transfer if this
Warrant had been exercised immediately before such reorganization, merger,
consolidation, sale or transfer, all subject to further adjustment as provided
in this Section 12. The foregoing provisions of this subsection (a) shall
similarly apply to successive reorganizations, consolidations, mergers, sales
and transfers and to the stock or securities of any other corporation which are
at the time receivable upon the exercise of this Warrant. If the per share
consideration payable to the Holder for shares in connection with any such
transaction is in a form other than cash or marketable securities, then the
value of such consideration shall be determined in good faith by the Company's
Board of Directors, whose determination shall be final and binding. In all
events, appropriate adjustment (as determined in good faith by the Company's
Board of Directors) shall be made in the application of the provisions of this
Warrant with respect to the rights and interests of the Holder after the
transaction, to the end that the provisions of this Warrant shall be applicable
after that event, as nearly as reasonably may be, in relation to any shares or
other property deliverable after that event upon exercise of this Warrant.
(b) RECLASSIFICATION, ETC. If the Company at any time while
this Warrant, or any portion thereof, remains outstanding and unexpired shall,
by reclassification of securities or otherwise, change any of the securities as
to which purchase rights under this Warrant exist into the same or a different
number of securities of any other class or classes, this Warrant shall
thereafter represent the right to acquire such number and kind of securities as
would have been issuable as the result of such change with respect to the
securities which were subject to the
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purchase rights under this Warrant immediately prior to such reclassification or
other change and the exercise price therefor shall be appropriately adjusted,
all subject to further adjustment as provided in this Section 12.
(c) SPLIT, SUBDIVISION OR COMBINATION OF SHARES. If the
Company at any time while this Warrant, or any portion thereof, remains
outstanding and unexpired shall split, subdivide or combine the securities as to
which purchase rights under this Warrant exist, into a different number of
securities of the same class, the exercise price for such securities shall be
proportionately decreased in the case of a split or subdivision or
proportionately increased in the case of a combination.
(d) ADJUSTMENTS FOR DIVIDENDS IN STOCK OR OTHER SECURITIES OR
PROPERTY. If while this Warrant, or any portion thereof, remains outstanding and
unexpired the holders of the securities as to which purchase rights under this
Warrant exist at the time shall have received, or, on or after the record date
fixed for the determination of eligible stockholders, shall have become entitled
to receive, without payment therefor, other or additional stock or other
securities or property (other than cash) of the Company by way of dividend, then
and in each case, this Warrant shall represent the right to acquire, in addition
to the number of shares of the security receivable upon exercise of this
Warrant, and without payment of any additional consideration therefor, the
amount of such other or additional stock or other securities or property (other
than cash) of the Company which such holder would hold on the date of such
exercise had it been the holder of record of the security receivable upon
exercise of this Warrant on the date hereof and had thereafter, during the
period from the date hereof to and including the date of such exercise, retained
such shares and/or all other additional stock available by it as aforesaid
during such period, giving effect to all adjustments called for during such
period by the provisions of this Section 12.
(e) CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment pursuant to this Section 12, the Company at its
expense shall promptly compute such adjustment or readjustment in accordance
with the terms hereof and furnish to each Holder a certificate setting forth
such adjustment or readjustment and showing in detail the facts upon which such
adjustment or readjustment is based. The Company shall, upon the written
request, at any time, of any such Holder, furnish or cause to be furnished to
such Holder a like certificate setting forth: (i) such adjustments and
readjustments; (ii) the exercise price at the time in effect; and (iii) the
number of shares and the amount, if any, of other property which at the time
would be received upon the exercise of the Warrant.
(f) NO IMPAIRMENT. The Company will not, by any voluntary
action, avoid or seek to avoid the observance or performance of any of the terms
to be observed or performed hereunder by the Company, but will at all times in
good faith assist in the carrying out of all the provisions of this Section 12
and in the taking of all such action as may be necessary or appropriate in order
to protect the rights of the Holders against impairment.
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13. REGISTRATION RIGHTS. The Holder of this Warrant is not entitled to
any registration rights with respect to the shares of Common Stock underlying
this Warrant, except as may be determined by the Company from time to time.
14. "CALL" BY THE COMPANY. The Warrants are subject to call and
cancellation by the Company at its option at any time prior to the Warrant
Expiration Date if:
(a) the closing sale price of the Company's Common Stock, if
listed on the American Stock Exchange or some other national exchange, or if not
listed on a national exchange, then the closing bid quotation of the Common
Stock as reported on NASDAQ, if listed thereon, or if not, some other reporting
system that provides last sale prices, shall have for a period of twenty (20)
consecutive days on which such market is open for trading (each a "TRADING DAY")
ending on the day prior to the date on which the Company gives the Call Notice
(as such term is hereinafter defined) equaled or exceeded $2.00 (as equitably
adjusted to reflect the occurrence if any of the events described in Section 12
hereof); and
(b) either: (i) the Company has on file with the Securities
and Exchange Commission (the "COMMISSION") a fully effective registration
statement under the Act covering all shares of Common Stock issuable upon
exercise of the outstanding Common Stock Warrants, or (ii) the shares of Common
Stock issuable upon exercise of the outstanding Common Stock Warrants may be
sold without any restriction pursuant to the rules of the Commission as
determined by the counsel to the Company pursuant to a written opinion letter.
Notice of the Company's exercise of its call (the "CALL NOTICE") shall be given
by the Company to the Holder in writing not less than twenty (20) Trading Days
before the date fixed for call, prior to which fixed date the Holder shall
maintain all of its rights hereunder. On and after the dated fixed for call, the
Holder shall have no rights with respect to outstanding Warrants, all of which
shall be canceled and, without more, shall be of no further force or effect.
15. MISCELLANEOUS PROVISIONS.
(a) GOVERNING LAW. This Warrant has been executed and
delivered in the State of New York and shall be governed by and construed in
accordance with the laws of the State of New York without reference to the
principles of conflicts of law thereof
(b) JURISDICTION. The Company hereby irrevocably consents and
submits to, and the Holder, by its acceptance of this Warrant, likewise hereby
irrevocably consents and submits to, the exclusive jurisdiction of the United
States District Court for the District of New Jersey in connection with any
proceeding arising out of or relating to this Warrant, waives any objection to
venue in such District (unless such court lacks jurisdiction with respect to
such proceeding, in which case, the Company irrevocably consents and submits to,
and the Holder, by its acceptance of this Warrant, likewise irrevocably consents
and submits to, the jurisdiction of the Courts of the State of New Jersey in
connection with such proceeding and waives any objection to venue in the State
of New Jersey), and agrees that service of any summons, complaint, notice or
other process
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relating to such proceeding may be effected in the manner provided by Section
10(g) of the Rights Agreement.
(c) ATTORNEYS' FEES. If any action at law or in equity is
necessary to enforce or interpret the terms of this Warrant, the prevailing
party shall be entitled to reasonable attorneys' fees, costs and disbursements,
in addition to any other relief to which such party may be entitled.
IN WITNESS WHEREOF, the Company has caused this Warrant to be
signed in its corporate name by a duly authorized officer and to be dated as of
the day and year written below.
Dated as of August ____, 1999
Total No. of Shares: 75,000
-------
DATAMETRICS CORPORATION
By: /s/ Xxxxxx X. Xxxxx
-----------------------
Name: Xxxxxx X. Xxxxx
Title: Chairman and CEO
-8-
NOTICE OF EXERCISE
To: DATAMETRICS CORPORATION
00X Xxxxxxx Xxxx
Xxxxx 0000
Xxxxxxx Xxxx, XX 00000
(1) The undersigned hereby elects to purchase __________ shares of
Common Stock of DATAMETRICS CORPORATION, pursuant to the terms of the attached
Warrant, and tenders herewith payment of the purchase price for such shares.
(2) In exercising this Warrant, the undersigned hereby confirms and
acknowledges that the shares of Common Stock are being acquired solely for the
account of the undersigned and not as a nominee for any other party, and for
investment, and that the undersigned will not offer, sell or otherwise dispose
of any such shares of Common Stock, except under circumstances that will not
result in a violation of the United States Securities Act of 1933, as amended,
or any foreign or state securities laws.
(3) Please issue a certificate or certificates representing said shares
of Common Stock in the name of the undersigned or in such other name as is
specified below:
(4) Please issue a new Warrant for the unexercised portion of the
attached Warrant in the name of the undersigned or in such other name as is
specified below:
------------------------------ --------------------------------------
Date: Name:
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