Contract
Exhibit
4.15
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISES OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD
OR OTHERWISE TRANSFERRED IN THE ABSENCE OF EFFECTIVE REGISTRATION STATEMENTS UNDER SUCH SECURITIES
ACT AND LAWS OR AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE ISSUER OF THIS WARRANT THAT SUCH
REGISTRATION IS NOT REQUIRED.
NATIONSHEALTH, INC., a Delaware corporation (the “Company”), hereby agrees that COMVEST
NATIONSHEALTH HOLDINGS, LLC, a Delaware limited liability company (the “Holder”), for value
received, is entitled, subject to the provisions of this Common Stock Purchase Warrant (this
“Warrant”), to purchase from the Company, in whole or in part, One Million (1,000,000) fully paid
and non-assessable shares of the Company’s common stock, $0.0001 par value per share (“Common
Stock”), at the Exercise Price set forth below.
1. Certain Definitions. When used herein, the following terms shall have the
following meanings:
(a) “Affiliate” means, as to any Person, any other Person that, directly or
indirectly, controls, or is controlled by, or is under common control with, such Person.
For this purpose, “control” (including, with its correlative meanings, “controlled by” and
“under common control with”) shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of management or policies of a Person, whether
through the ownership of securities or partnership or other ownership interests, by
contract or otherwise.
(b) “Effective Date” means fifteen (15) days after the date that the Merger Agreement
is terminated pursuant to (i) Section 7.1(c)(i) or Section 7.1(c)(iii) of the Merger
Agreement and the Company’s breach triggering such termination shall have been willful or
(ii) Section 7.1(b)(iii), Section 7.1(c)(ii), or Section 7.1(d)(iii) of the Merger
Agreement.
(c) “Exercise Notice” means a notice of exercise of all or any portion of this
Warrant, in the form attached hereto as Exhibit A.
(d) “Exercise Price” means $0.01 per share of Common Stock, as adjusted as provided
herein.
(e) “Expiration Date” means the earliest to occur of the following: (i) the exercise
of all of the rights represented by this Warrant, (ii) the ten (10) year anniversary of the
Effective Date, or (iii) the Effective Time (as defined in the Merger Agreement).
(f) “Merger Agreement” means that certain Agreement and Plan of Merger dated April 30,
2009, by and among Holder, NationsHealth Acquisition Corp., a Delaware corporation and a
wholly owned subsidiary of the Holder, and the Company.
(g) “Person” means and includes an individual, limited liability company, partnership,
corporation, trust, joint venture, incorporated organization and a government or any
department or agency thereof.
(h) “Securities Act” means the Securities Act of 1933, as amended.
(i) “Warrant Shares” means the shares of Common Stock issuable to the Holder upon any
exercise of this Warrant.
2. Warrant Exercise; Issuance of Stock Certificates. This Warrant may be exercised by
the Holder, in whole or in part, at any time on or after the Effective Date until and including the
Expiration Date, as follows:
(a) This Warrant may be exercised in whole, or in part, by the Holder by delivery of
an Exercise Notice and, promptly thereafter, surrender of this Warrant (properly endorsed
if required), each 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 set forth in
Section 11 hereof), and payment by the Holder of the aggregate Exercise Price for the
Warrant Shares to be purchased. Upon such surrender and payment, the Holder shall be
entitled to receive a certificate or certificates representing the Warrant Shares so
purchased. The Company agrees that the Warrant Shares so purchased shall be deemed to be
issued to the Holder as the record owner of such Warrant Shares as of the close of business
on the date on which this Warrant shall have been surrendered for such Warrant Shares and
payment made for such Warrant Shares as aforesaid. As promptly as practicable on or after
such date, and in any event within five (5) days thereafter, the Company shall, at its
expense, issue and deliver to the person or persons entitled to receive the same (i) a
certificate or certificates for the Warrant Shares; (ii) in the event that this Warrant is
exercised in part, a new Warrant of like tenor representing the portion of the shares of
Common Stock, with respect to which this Warrant will not then have been exercised and
exercisable for the number of shares for which this Warrant may then be exercised; and
(iii) an amount in cash in lieu of any fractional shares as provided in Section 5 hereof.
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(b) Notwithstanding anything contained herein to the contrary, the Holder may, at its
election exercised in its sole discretion, exercise this Warrant in whole or in part and,
in lieu of making the cash payment otherwise contemplated
to be made to the Company upon such exercise in payment of the Exercise Price, elect
instead to receive upon such exercise a certificate or certificates representing the number
of Warrant Shares (up to the total number of Warrant Shares which are subject to this
Warrant) multiplied by a fraction, the numerator of which shall be the difference between
the then fair market value of one share of the Common Stock and the Exercise Price, and the
denominator of which shall be the then fair market value of one share of the Common Stock
(a “Cashless Exercise”).
(c) For purposes of the calculation set forth in Section 2(b) above, fair market value
of one share of Common Stock shall be determined by the Company’s Board of Directors in
good faith; provided, however, that where there exists a public market for the Company’s
Common Stock at the time of such exercise, the fair market value per share shall be the
average of the closing bid and asked prices of the Common Stock quoted in the
Over-The-Counter Market Summary or the last reported sale price of the Common Stock or the
closing price quoted on the Nasdaq National Market or on any exchange on which the Common
Stock is listed, whichever is applicable, as published in the Western Edition of The Wall
Street Journal over a five (5) day period ending with the third business day before the
date of determination of fair market value. Notwithstanding the foregoing, in the event
the Warrant is exercised in connection with the Company’s initial public offering of Common
Stock, the fair market value per share shall be the per share offering price to the public
of the Company’s initial public offering.
(d) In the event that the Holder does not exercise this Warrant prior to the
Expiration Date, to the extent that this Warrant is then exercisable and such exercise
would result in the issuance of shares of Common Stock to the Holder, this Warrant shall be
deemed automatically exercised for all purposes hereof through a Cashless Exercise as
described in Section 2(b) hereof immediately prior to the time at which it would otherwise
expire.
3. Affirmative Covenants. The Company covenants and agrees that the Warrant Shares
will, upon exercise of this Warrant and issuance of the Warrant Shares in accordance herewith, be
duly authorized, validly issued, fully paid and nonassessable, free from all liens and charges with
respect to the issuance thereof, and will not be subject to preemptive rights other than pursuant
to the Preferred Stock Investment Documents. The Company further covenants and agrees that during
the period within which the rights represented by this Warrant may be exercised, the Company will
use its best efforts to at all times have authorized and reserved a sufficient number of Common
Stock to provide for the exercise of the rights represented by this Warrant, and, from time to
time, will take all steps necessary to amend its Second Restated Certificate of Incorporation (as
may be amended or restated from time to time, the “Certificate”) to provide sufficient reserves of
shares of its capital stock for the Warrant Shares. 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 the Warrant Shares.
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4. Adjustments of Exercise Price and Warrant Shares.
(a) If at any time prior to the Expiration Date the Company shall (i) pay a dividend
or make a distribution on its Common Stock in shares of its capital stock of any class,
(ii) subdivide its outstanding shares of Common Stock into a greater number of shares,
(iii) combine its outstanding shares of Common Stock into a smaller number of shares, or
(iv) reclassify, reorganize or effect any similar transaction
with respect to any of its shares of Common Stock, or in substitution or exchange therefor (other than a transaction
referred to in Section 4(b)), then thereafter the number of Warrant Shares (or other class
of capital stock, if applicable) shall be automatically increased or decreased, as the case
may be, in direct proportion to the increase or decrease in the number of shares of Common
Stock (or other class of capital stock, if applicable) by reason of such action, and the
Exercise Price after such action shall, in case of an increase in the number of shares, be
proportionately decreased and, in case of a decrease in the number of shares, be
proportionately increased so that the aggregate Exercise Price of this Warrant shall be
unchanged.
(b) If at any time prior to the Expiration Date, the Company is a party to (1) a share
exchange or merger of the Company with and into another company (other than the transaction
contemplated by the Merger Agreement) (a “Merger”), (2) any agreement providing for the
sale of substantially all of the Company’s assets (an “Asset Sale”), or (3) a “Stock Sale”,
which means any transaction or series of transactions (related or unrelated) which result
in the person or persons currently owning the shares of Common Stock of the Company no
longer owning, immediately after such transaction or series of transactions, in excess of
fifty percent (50%) of the issued and outstanding shares of Common Stock of the Company,
other than pursuant to a conversion of the outstanding obligations under the Bridge Loan
into shares of Preferred Stock pursuant to the Bridge Loan Documents (any Merger, Asset
Sale or Stock Sale shall be considered a “Sale of the Company”), this Warrant shall pertain
and apply to the Warrant Shares or other securities and/or property to which the Holder
would have otherwise been entitled had this Warrant been exercised in whole immediately
prior to the Sale of the Company. The foregoing provisions of this Section 4(b) shall
similarly apply to successive share exchanges, mergers, asset sales and stock sales, and to
the stock or securities of any other corporation that are at the time receivable upon the
exercise of this Warrant. If the per-share consideration payable to
the Holder hereof 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. 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 near as reasonably may be, in relation to any shares or other property
deliverable after that event upon exercise of this Warrant. In addition, if at any time
while this Warrant, or any portion hereof, is outstanding
and unexpired, there shall be a Sale of the Company (including, without limitation,
pursuant to the consummation of the transactions contemplated by a Takeover Proposal), this
Warrant shall be deemed to be automatically exercised in whole through Cashless Exercise as
described in Section 2(b) hereof. The Company agrees that such shares to be issued to the
Holder upon Cashless Exercise as a result of a Sale of the Company shall be deemed to be
issued to the Holder as the record owner of such shares as of the close of business on the
date of such transaction.
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(c) In case any event shall occur as to which the provisions of Section 4 are not
strictly applicable but failure to make any adjustment would not fairly protect the
purchase rights represented by this Warrant in accordance with the essential intent and
principles of such actions, then, in each such case, the Company shall appoint a firm of
independent certified public accountants of recognized national standing (such firm to be
subject to the approval of the Holder), which shall give their opinion upon the adjustment,
if any, on a basis consistent with the essential intent and principles established in this
Section 4, necessary to preserve, without dilution, the purchase rights represented by this
Warrant. Upon receipt of such opinion, the Company will promptly mail a copy thereof to
the Holder and shall make the adjustments described therein.
(d) An adjustment made pursuant to this Section 4 shall become effective immediately
after the payment date in the case of a dividend or distribution and shall become effective
immediately after the effective date in the case of a subdivision, combination,
reclassification, reorganization, Sale of the Company or similar transaction.
(e) Whenever the number of Warrant Shares or the Exercise Price is adjusted as herein
provided, the Company shall cause to be mailed to the Holder in accordance with the
provisions of Section 11 a notice (i) stating that an event giving rise to an adjustment
hereunder has occurred, (ii) setting forth the adjusted number of Warrant Shares and the
adjusted Exercise Price and (iii) showing in reasonable detail the computations and the
facts upon which such adjustments are based.
(f) No adjustment pursuant to this Section 4 shall require the Company to issue
fractional shares and, in lieu thereof, the number of shares to be issued upon the exercise
of this Warrant shall be rounded to the nearest whole number.
(g) At any time on or after the Effective Date, the Company will not, by amendment of
its Certificate or through any consolidation, merger, reorganization, transfer of assets,
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 action as may be necessary or appropriate in order to protect the rights of the Holder
of this
Warrant against dilution or other impairment. Without limiting the generality of the
foregoing, the Company (i) will not permit the par value of any shares of stock receivable
upon the exercise of this Warrant to exceed the amount payable therefor upon such exercise,
(ii) will take all such action as may be necessary or appropriate in order that the Company
may validly and legally issue fully paid and non-assessable shares of stock on the exercise
of the Warrants from time to time outstanding, and (iii) will not take any action which
results in any adjustment of the Exercise Price if the total number of shares of Common
Stock issuable after the action upon the exercise of the Warrant would exceed the total
number of shares of Common Stock then authorized by the Company’s Certificate and available
for the purpose of issue upon such exercise. The Company shall also give written notice to
the Holder prior to the date on which any such voluntary action described in the first
sentence of this Section 4(h) shall take place.
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5. Elimination of Fractions. The Company shall not be required to issue certificates
representing fractional shares of Common Stock upon any exercise of this Warrant, but will make a
payment in cash, in lieu of issuing such fractional shares, equal to the Exercise Price per share
at the time multiplied by such fraction.
6. Notification to Holder. If, (i) at any time, the Board of Directors of the Company
(or any committee thereof) shall authorize or approve any capital reorganization or
reclassification of the Common Stock of the Company, or any Sale of the Company, (ii) at any time,
the Company (or any other party) shall institute any proceeding seeking an order for relief under
the Federal bankruptcy laws or seeking to adjudicate the Company as bankrupt or insolvent, or
seeking dissolution, liquidation or winding up of the Company or seeking reorganization under any
law relating to bankruptcy or insolvency, or (iii) at any time on or after the Effective Date, 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, 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, Sale of the company, 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, Sale of the Company, dissolution, liquidation or winding-up. Such notice shall
be mailed by certified or registered mail, postage prepaid prior to the date therein specified.
7. Term of Warrant. This Warrant shall remain outstanding and exercisable on or after
the Effective Date until and including the Expiration Date. To the
extent not previously exercised, the rights represented by this Warrant shall thereupon
terminate.
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8. Closing of Books. The Company will at no time close its transfer books in any
manner which interferes with the timely exercise of the rights represented by this Warrant.
9. No Rights as a Stockholder. The Holder shall not be deemed for any purpose to be a
stockholder of the Company with respect to any Warrant Shares which may be acquired hereunder
except to the extent that the Warrant shall have been properly exercised with respect thereto and
payment has been made therefor in accordance with Section 2, provided, however that at all times on
or after the Effective Date the Company will furnish to Holder, promptly upon their becoming
available and at the request of the Holder, copies of all financial statements, reports, and
notices sent or made available by the Company to any of its stockholders, and copies of any and all
regular and periodic reports, registration statements and prospectuses filed by the Company with
any securities exchange or with the U.S. Securities and Exchange Commission.
10. Notices. All notices, requests and other communications to any party hereunder
shall be in writing and shall be deemed given if delivered personally, sent by facsimile (which is
confirmed by an acknowledgement or transmission report generated by the machine from which the
facsimile was sent indicating that the facsimile was sent in its entirety to the addressee’s
facsimile number) or sent by overnight courier (providing proof of delivery) to the parties at the
following addresses:
| If to Holder, to: ComVest Investment Partners III, L.P. Xxx Xxxxx Xxxxxxxx Xxxxx 000 Xxxx Xxxx Xxxxx, Xxxxxxx 00000 Attention: Xxxxxxx Xxxxxxxxx Facsimile: (000) 000-0000 |
with a copy (which shall not constitute notice) to:
| Xxxxx & Lardner LLP 000 Xxxxx Xxxxx Xxxxxx Xxxxx 0000 Xxxxx, XX 00000 Attention: Xxxxxx X. Xxxxxxx Facsimile: (000) 000-0000 |
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| If to the Company, to: NationsHealth, Inc. 00000 XX 0xx Xxxxxx Xxxxx 000 Xxxxxxx, Xxxxxxx 00000 Attention: Chief Executive Officer Facsimile: (000) 000-0000 |
with a copy (which shall not constitute notice) to:
| XxXxxxxxx Will & Xxxxx LLP 000 Xxxxx Xxxxxxxx Xxxxxxxxx 00xx Xxxxx Xxxxx, Xxxxxxx 00000 Phone: 000.000.0000 Fax: 000.000.0000 Attention: Xxx X. Xxxxxxx, Esq. Xxxxxxxx X. Xxxxxxxx, Esq. Xxxxxx Xxxxxxx, Esq. and XxXxxxxxx Will & Xxxxx LLP 000 Xxxx Xxxxxx Xxxxxx Xxxxxxx, Xxxxxxxx 00000 Phone: 000.000.0000 Fax: 000.000.0000 Attention: Xxxxx X. Xxxxxxx, Esq. |
or such other address or facsimile number as such party may hereafter specify by like notice to the
other parties hereto. All such notices, requests and other communications shall be deemed received
on the date of receipt by the recipient thereof if received prior to 5 P.M. in the place of receipt
and such day is a Business Day in the place of receipt. Otherwise, any such notice, request or
communication shall be deemed not to have been received until the next succeeding Business Day in
the place of receipt. In the event that an addressee of a notice or communication rejects or
otherwise refuses to accept a notice or other communication delivered or sent in accordance with
this Section 10, or if the notice or other communication cannot be delivered because of a change in
address for which no notice was given, then such notice or other communication is deemed to have
been received upon such rejection, refusal or inability to deliver.
11. Replacement of Warrant. Upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant or any stock certificate
issuable upon exercise of this Warrant and, in the case of loss, theft or destruction, on delivery
of an indemnity agreement reasonably satisfactory in form and substance to the Company or, in the
case of mutilation, on surrender and cancellation of this Warrant or stock certificate, the Company
at its expense shall execute and deliver, in lieu of this Warrant or stock certificate, a new
warrant or stock certificate of like tenor and amount.
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12. Investor Representations. The Holder acknowledges that it is acquiring this
Warrant and Warrant Shares for the Holder’s own account and not as a nominee for any other party
and that the Holder has no present intention of selling this Warrant or the Warrant Shares in a
public distribution in violation of the federal securities laws or any applicable state securities
laws. The Holder is an “accredited investor” as defined in Rule 501(a) under the Securities Act.
13. Transfer of Warrant.
(a) Transferability and Nonnegotiability of Warrant. This Warrant may not be
transferred or assigned in whole or in part (i) prior to the Effective Date or (ii) on or after the
Effective Date without compliance with all applicable federal and state securities laws by the
transferor and the transferee (including the delivery of investment representation letters and
legal opinions reasonably satisfactory to the Company, if such are requested by the Company). On
or after the Effective Date and subject to the provisions of this Warrant with respect to
compliance with the Securities Act, title to this Warrant may be transferred by endorsement (by the
Holder executing the Assignment Form annexed hereto (the “Assignment Form”)) and delivery in the
same manner as a negotiable instrument transferable by endorsement and delivery.
(b) Exchange of Warrant Upon a Transfer. On surrender of this Warrant for exchange,
properly endorsed on the Assignment Form and subject to the provisions of this Warrant with respect
to compliance with the Securities Act and with the limitations on assignments and transfers
contained in this Section 14, the Company at its expense shall issue to or on the order of the
Holder a new warrant or warrants of like tenor, in the name of the Holder or as the Holder may
direct, for the number of shares issuable upon exercise hereof.
(c) Legend. This Warrant and any certificates representing the Warrant Shares issued
to the Holder shall bear on the face thereof substantially the following legend and any additional
legends as may be required under state securities laws:
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN SOLD IN RELIANCE
UPON AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT OR
THE SECURITIES LAWS OF ANY STATE. THE SECURITIES MAY NOT BE SOLD, OFFERED FOR
SALE, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF A
REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER THE
SECURITIES ACT OR AN OPINION OF COUNSEL OR UPON EVIDENCE THAT SUCH REGISTRATION IS
NOT REQUIRED.”
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14. Warrant Agent. The Company may, on written notice to the Holder, appoint an agent
for the purposes of issuing Common Stock upon the exercise of this Warrant and of replacing or
exchanging this Warrant, and after that appointment any such issuance, replacement, or exchange
shall be made at that office by that agent.
15. Governing Law. This Warrant is made under and shall be governed by and construed
in accordance with the internal laws of, and enforced by the courts located within, the State of
Delaware, without giving effect to any principles of conflict of laws.
16. Successors and Assigns. The provisions of this Warrant shall be binding upon and
inure to the benefit of the parties hereto and their respective successors, assigns and
transferees.
17. Further Assurances. The Company agrees that it will execute and record such
documents as the Holder shall reasonably request to secure for the Holder any of the rights
represented by this Warrant.
18. Amendment and Modifications. This Warrant may be amended, modified or
supplemented only by written agreement of the Company and the Holder.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Company has executed this Warrant as of the date first written above.
| NATIONSHEALTH, INC. |
||||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | CEO | |||
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