EXHIBIT 4.2
SECURITIES PURCHASE AGREEMENT
BY AND BETWEEN
NUCLEUS, INC.
AND THE
PURCHASERS
NAMED HEREIN
JUNE 2, 1999
THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
THE SECURITIES COMMISSION OF ANY STATE UNDER ANY STATE SECURITIES LAW. THEY ARE
BEING OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER REGULATION D
("REGULATION D") PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT
AND APPLICABLE STATE SECURITIES LAWS, OR SUCH OFFERS, SALES AND TRANSFERS ARE
MADE PURSUANT TO AVAILABLE EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF
THOSE LAWS.
SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT (the "Agreement" or the "Purchase
Agreement") is entered into as of June 2, 1999, by and between NUCLEUS, INC., a
Nevada corporation (the "Company"), and each of the undersigned (each a
"Purchaser" and collectively the "Purchasers").
R E C I T A L S:
WHEREAS, the Company is offering (the "Offering") for sale in a private
placement pursuant to Section 4(2) of the Securities Act of 1933, as amended
(the "Act"), and Regulation D thereunder ("Regulation D"), shares of the
Company's Common Stock, par value $.001 per share (the "Common Stock"); and
WHEREAS, each Purchaser wishes to subscribe for the number of shares of
Common Stock and warrants to purchase shares of Common Stock set forth opposite
each Purchaser's name on Schedule 1.1 hereto in accordance with the terms and
conditions of this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto hereby agree as follows:
1. SUBSCRIPTION AND CLOSING
1.1 PURCHASE. Subject to the terms and conditions of this
Agreement, the Purchasers hereby agree to purchase from the Company, and the
Company hereby agrees to issue and sell to the Purchasers, _______ shares of
Common Stock (the "Shares") for $____ per share, or an aggregate purchase price
of $_________. As additional consideration for the purchase of the Shares, the
Company grants to the Purchasers warrants to purchase _______ shares of Common
Stock (the "Warrants") upon the terms set forth in the form of warrant attached
as Exhibit A, which terms are incorporated herein by reference and made a part
hereof. The number of Shares and Warrants to be issued or granted to each
Purchaser, and the aggregate purchase price therefor to be paid by each
Purchaser, shall be as indicated on Schedule 1.1 hereto.
1.2 PAYMENT OF PURCHASE PRICE AND DELIVERY OF SHARES AND
WARRANTS. Payment of the purchase price for the Shares by the Purchaser, and
delivery of the Shares and Warrants by the Company (the "Closing"), shall occur
upon the execution hereof or at such other date, time and place as the parties
shall mutually agree in writing. The purchase price for the Shares is payable by
wire transfer of immediately available funds. Certificates for the Shares and
Warrants will be issued in the name of Purchasers.
1.3 MULTIPLE PURCHASES. This Agreement may be executed by one or
more Purchasers. In the event this Agreement pertains to a purchase by a single
Purchaser, all references to the Purchasers or "each Purchaser" shall be deemed
to refer to such single Purchaser.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF COMPANY
The Company represents and warrants to and covenants with the
Purchasers as follows:
2.1 ORGANIZATION, GOOD STANDING, AND QUALIFICATION.
(a) The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Nevada and has all requisite corporate power and authority to carry on
its business as now conducted and as proposed to be conducted. The
Company is duly qualified to transact business and is in good standing
in each jurisdiction in which the failure to so qualify would have a
material adverse effect on the business or properties of the Company
and its subsidiaries taken as a whole.
(b) Each subsidiary of the Company is a corporation
duly organized, validly existing and in good standing under the laws
of its state of incorporation and has all requisite corporate power
and authority to carry on its business as now conducted and as
proposed to be conducted. Each such subsidiary is duly qualified to
transact business and is in good standing in each jurisdiction in
which the failure to so qualify would have a material adverse effect
on the business or properties of such subsidiary.
2.2 AUTHORIZATION. All corporate action on the part of the
Company, its officers, directors and shareholders necessary for the
authorization, execution and delivery of this Agreement, and the performance of
all obligations of the Company hereunder and the authorization, issuance and
delivery of the Shares, the Warrants and shares of Common Stock issuable upon
exercise of the Warrants (the "Warrant Shares," and together with the Shares and
Warrants, the "Securities"), has been taken.
2.3 AGREEMENT. This Agreement has been duly executed and
delivered by the Company and, assuming due authorization, execution and delivery
of this Agreement by the Purchaser, is a valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
2.4 VALID ISSUANCE OF SHARES. When issued and delivered in
accordance with the terms of this Agreement, the Shares will be duly and validly
issued and outstanding, fully paid and non-assessable, free and clear of any
claims or pre-emptive rights, and (assuming the representations and warranties
of the Purchaser herein are true and correct in all material respects) will have
been issued in compliance with all applicable federal and state securities law.
2.5 SEC REPORTS. The Company has timely filed all forms,
reports and documents with the Securities and Exchange Commission (the
"Commission") since January 1, 1998, required to be filed by it under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), through the date
hereof (collectively, the "SEC Reports"). Such SEC Reports, at the time filed,
complied as to form in all material respects with the requirements of the 1934
Act.
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2.6 CURRENT PUBLIC INFORMATION. The Company's Common Stock is
registered under Section 12(b) or 12(g) of the 1934 Act. The Company has
delivered to the Purchaser copies of the Company's most recent annual report on
Form 10-K/SB (the "Annual Report"), each Quarterly Report on Form 10-Q/SB since
the date of its Annual Report, the most recent proxy statement for its Annual
Meeting of Shareholders, and each interim report on Form 8-K filed by the
Company since the date of its Annual Report.
2.7 NO CONFLICTS. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby does not and will
not conflict with or result in a breach by the Company of any of the terms or
provisions of, or constitute a default under, the Certificate of Incorporation
or bylaws of the Company, or any indenture, mortgage, deed of trust or other
agreement or instrument to which the Company is a party or by which it or any of
its properties or assets are bound, or any existing applicable decree, judgment
or order of any court, federal or state regulatory body, administrative agency
or other governmental body having jurisdiction over the Company or any of its
properties or assets.
2.8 COMPLIANCE WITH LAWS. As of the date hereof, the conduct
of the business of the Company complies in all material respects with all
statutes, laws, regulations, ordinances, rules, judgments, orders or decrees
applicable thereto, except for non -compliance which would not have a material
adverse effect on the business, properties, condition (financial or otherwise),
results of operations or prospects of the Company (a "Material Adverse Effect").
The Company has not received notice of any alleged violation of any statute,
law, regulation, ordinance, rule, judgment, order or decree from any
governmental authority, which would have a Material Adverse Effect.
2.9 LITIGATION. Except as disclosed in the SEC Reports, there
is no action, suit or proceeding before or by any court or governmental agency
or body, domestic or foreign, now pending or, to the knowledge of the Company,
threatened, against or affecting the Company, or any of its properties, which
could reasonably be expected to result in any material adverse change in the
business, properties, results of operations, condition (financial or otherwise),
or prospects of the Company, or which could reasonably be expected to materially
and adversely affect the properties or assets of the Company or which could
reasonably be expected to interfere with the Company's ability to consummate the
transactions contemplated by this Agreement.
2.10 PRIOR PRIVATE PLACEMENTS. The offer and sale of the
Securities are exempt from registration under Section 5 of the Act. Neither the
Company nor any person acting on its behalf has taken or will take any action
(including, without limitation, any offering of any securities of the Company
under circumstances which would require the integration of such offering with
the offering of the Securities) which would subject the offering or issuance or
sale of the Securities to the registration requirements of Section 5 of the Act.
2.11 COMMISSIONS. Except for a fee payable by the Company to ________
for services rendered to the Company in the amount of $_______, no person, firm
or corporation will be entitled to receive any brokerage fee, commission or
other similar payment from the Company
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in connection with the consummation of the transactions contemplated hereby and
the Company shall not make any such payment to any person, firm or corporation.
3. REPRESENTATIONS AND WARRANTIES OF PURCHASERS; ACCESS TO INFORMATION;
INDEPENDENT INFORMATION; INDEPENDENT INVESTIGATION
Each Purchaser represents and warrants to the Company as follows:
3.1 INDEPENDENT INVESTIGATION. Each Purchaser, in offering to
purchase the Securities hereunder, has, prior to the date hereof, been given
access to and the opportunity to examine all books, records and material
contracts and documents of the Company and to meet with and ask questions of the
Company's management. In making its investment decision to purchase the
Securities, no Purchaser is relying on any oral or written representations or
assurances from the Company or any other person or any representation of the
Company or any other person other than as set forth in this Agreement, the SEC
Reports or in a document executed by a duly authorized representative of the
Company making reference to this Agreement. Each Purchaser has such experience
in business and financial matters that it is capable of evaluating the risk of
its investment and determining the suitability of its investment. Each Purchaser
is a sophisticated investor, as defined in Rule 506(b)(2)(ii) of Regulation D
under the Act, and an "accredited investor" as defined in Rule 501 of Regulation
D under the Act.
3.2 ECONOMIC RISK. Each Purchaser understands and acknowledges
that an investment in the Securities involves a high degree of risk, including a
possible total loss of investment. Each Purchaser represents that it is able to
bear the economic risk of an investment in the Securities.
3.3 NO GOVERNMENT RECOMMENDATION OR APPROVAL. Each Purchaser
understands that no federal or state agency or similar agency of any other
country has passed upon or made any recommendation or endorsement of the
Company, this transaction or the subscription of the Securities.
3.4 NO REGISTRATION. Each Purchaser understands that the
Securities have not been registered under the Act and are being offered and sold
pursuant to an exemption from registration contained in the Act based in part
upon the representations of the Purchasers contained herein. The Shares and
Warrant Shares do, however, carry certain registration rights as set forth in
the Registration Rights Agreement dated the date hereof and executed by the
parties hereto in connection herewith (the "Registration Rights Agreement").
3.5 NO PUBLIC SOLICITATION. Without conducting any independent
investigation, no Purchaser knows of any public solicitation or advertisement of
an offer in connection with the proposed issuance and sale of the Securities.
3.6 INVESTMENT INTENT. Each Purchaser is acquiring the Securities
for its own account, for investment and not with a view to the distribution
thereof. Each Purchaser understands that except as set forth in the Registration
Rights Agreement, the Company has no present intention
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of registering any such sale of the Securities. Each Purchaser represents and
warrants to the Company that it has made no predetermined arrangements to sell
the Securities (other than the registration provisions contained in the
Registration Rights Agreement, which pertain only to a potential method of
disposing of the Shares and Warrant Shares).
3.7 INCORPORATION AND AUTHORITY. Each Purchaser has the full
power and authority to execute, deliver and perform this Agreement and to
perform its obligations hereunder. The Agreement has been duly approved by all
necessary action of each Purchaser, including any necessary shareholder
approval, has been executed by persons duly authorized by each Purchaser, and
constitutes a valid and legally binding obligation of each Purchaser,
enforceable in accordance with its terms.
3.8 NO RELIANCE ON TAX ADVICE. Each Purchaser has reviewed
with its own tax advisors the foreign, federal, state and local tax consequences
of this investment, where applicable, and the transactions contemplated by this
Agreement. Each Purchaser is relying solely on such advisors and not on any
statements or representations of the Company or any of its agents and
understands that each Purchaser (and not the Company) shall be responsible for
its own income tax liability that may arise as a result of this investment or
the transactions contemplated by this Agreement.
3.9 INDEPENDENT LEGAL ADVICE. Each Purchaser acknowledges that
it has had the opportunity to review this Agreement and the transactions
contemplated by this Agreement with its own legal counsel. The Purchaser is
relying solely on such counsel and not on any statements or representations of
the Company or any of its agents for legal advice with respect to this
investment or the transactions contemplated by this Agreement, except for the
representations, warranties and covenants set forth herein.
4. LEGENDS; SUBSEQUENT TRANSFER OF SECURITIES
4.1 LEGENDS. The certificate(s) representing the Securities
shall bear a legend substantially as set forth on the cover page of this
Agreement and any other legend, if such legend or legends are reasonably
required to comply with state, federal or foreign law.
5. COVENANTS OF THE COMPANY
5.1 USE OF PROCEEDS. The Company shall use the net proceeds
from the sale of the Securities for general corporate purposes, including
acquisition or merger consideration with respect to any acquisition that may be
consummated by the Company.
5.2 REGISTRATION RIGHTS. The Company will grant the Purchasers
registration rights covering the Shares and Warrant Shares as set forth in the
Registration Rights Agreement. In the event the registration statement
contemplated by the Registration Rights Agreement is not declared effective by
the Commission within ninety days (90) following the Closing contemplated
herein, the Company shall pay to the Purchasers, as liquidated damages and not
as a penalty, the aggregate sum of $1,393 for each day the registration
statement has not been declared effective
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following such ninety (90) day period. Any liquidated damages shall be paid in
cash by the Company on a pro rata basis to the Purchasers on the last day of
each calendar month in which a payment obligation arises.
5.3 VALID ISSUANCE OF WARRANT SHARES. When issued and
delivered in accordance with the Warrant, the Warrant Shares will be duly and
validly issued, fully paid and non-assessable, free and clear of any claims or
pre-emptive rights and will have been issued in compliance with all applicable
federal and state securities laws.
6. COVENANTS OF THE PURCHASERS
6.1 NO SALE IN VIOLATION OF THE ACT. Each Purchaser further
covenants that it will not make any sale, transfer or other disposition of the
Securities in violation of the Act or the rules and regulations of the
Commission promulgated thereunder. Each Purchaser acknowledges and agrees that
the Securities may and will only be resold (i) pursuant to a Registration
Statement under the Act; or (ii) pursuant to an exemption from registration
under the Act.
7. CONDITIONS TO CLOSING; DELIVERIES AT CLOSING
7.1 CONDITIONS TO PURCHASERS' OBLIGATIONS TO CLOSE. The obligations
of the Purchasers to purchase the Shares and the Warrants offered hereunder are
conditioned on the fulfillment or waiver of the following:
(a) the execution and delivery of this Agreement, the
Warrant and the Registration Rights Agreement by the
Company; and
(b) all the representations and warranties of the
Company in this Agreement as of the date hereof shall be
true and correct at the Closing as if made on such date, and
the Company shall have performed all actions required
hereunder.
7.2 CONDITIONS TO THE COMPANY'S OBLIGATION TO CLOSE. The obligation
of the Company to sell the Shares offered hereunder are conditioned on the
fulfillment or waiver of the following:
(a) the execution and delivery of this Agreement and the
Registration Rights Agreement by the Purchasers; and
(b) all the representations and warranties of the
Purchasers made in this Agreement as of the date hereof
shall be true and correct at the Closing as if made on such
date, and the Purchasers shall have performed all actions
required hereunder.
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8. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the laws of the State of Illinois, applicable to agreements made in and wholly
to be performed in that jurisdiction without regards to the choice of law rules
of such state, except for matters arising under the Act or the 1934 Act which
matters shall be construed and interpreted in accordance with such laws. Any
action brought to enforce, or otherwise arising out of, this Agreement shall be
heard and determined in either a federal or state court sitting in the County of
Xxxx, State of Illinois.
9. ENTIRE AGREEMENT; AMENDMENT
This Agreement, the Registration Rights Agreement, and any other
document delivered pursuant hereto constitute the full and entire understanding
and agreement between the parties with regard to the subjects hereof and
thereof, and no party shall be liable or bound to any other party in any manner
by any warranties, representations or covenants except as specifically set forth
herein or therein. Except as expressly provided herein, neither this Agreement
nor any term hereof may be amended, waived, discharged or terminated other than
by a written instrument signed by the party against whom enforcement of any such
amendment, waiver, discharge or termination is sought.
10. NOTICES, ETC.
Any notice, demand or request required or permitted to be given by
either the Company or any Purchaser pursuant to the terms of this Agreement
shall be in writing and shall be deemed given when delivered personally or by
facsimile, with a hard copy to follow by two day courier addressed to the
parties at the addresses of the parties set forth at the end of this Agreement
or such other address as a party may request by notifying the other in writing.
11. CONFIDENTIALITY
Each Purchaser will keep confidential all non-public information
regarding the Company that each receives from the Company unless disclosure of
such information is compelled by a court or other administrative body or
otherwise necessary, in the opinion of Purchasers' counsel, to comply with
applicable law. Neither party shall disclose any information regarding any of
the transactions contemplated hereby without the prior consent of the other
party, unless such disclosure is required in filings made with the Commission.
The Company and its officers and directors have not provided the Purchasers with
any material non-public information.
12. COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be enforceable against the parties actually executing such
counterparts, and all of which together shall constitute one instrument. A
facsimile transmission of a signature hereto shall be valid as if an original
and binding on all parties.
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13. SEVERABILITY
In the event that any provision of this Agreement becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or
void, this Agreement shall continue in full force and effect without said
provision; provided that no such severability shall be effective if it
materially changes the economic benefit of this Agreement to any party.
14. TITLES AND SUBTITLES
The titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in construing or interpreting this
Agreement.
15. PARTIES IN INTEREST CITED
This Agreement may not be transferred, assigned, pledged or
hypothecated by any party hereto, other than by operation of law. This Agreement
shall be binding upon, and shall inure to the benefit of, the parties hereto and
their respective heirs, executors, administrators, successors and permitted
assigns. All representations, warranties, covenants and agreements of each party
hereto shall survive the Closing contemplated herein for a period of two (2)
years.
The undersigned Purchasers acknowledge that this subscription shall not
be effective unless executed by the Company as indicated below.
[Signature page follows]
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IN WITNESS WHEREOF, the parties have executed this Agreement on the
date first written above.
COMPANY: PURCHASERS:
NUCLEUS, INC. _________________________
000 Xxxxx Xxxxxxxx Xxxxxx _________________________
Xxxxx 0000
Xxxxxxx, XX 00000 _________________________
By:_____________________________ _________________________
Xxxx X. Xxxxxxx, President
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SCHEDULE 1.1
PURCHASERS
No. of Shares of
Common No. of Warrants Aggregate
Name Stock Purchased Granted Purchase Price
---- --------------- ------- --------------
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EXHIBIT A
WARRANT NO.___
THE WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE
NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES COMMISSION OF
ANY STATE UNDER ANY STATE SECURITIES LAW. THE SECURITIES MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT
AND APPLICABLE STATE SECURITIES LAWS, OR SUCH OFFERS, SALES AND TRANSFERS ARE
MADE PURSUANT TO AVAILABLE EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF
THOSE LAWS.
WARRANT TO PURCHASE
SHARES OF COMMON STOCK OF
NUCLEUS, INC.
_____________ ___, 1999
This certifies that, for value received pursuant to that certain
Securities Purchase Agreement, dated as of ________, 1999, by and among Nucleus,
Inc., _______________________ and certain other purchasers, _____________ (the
"Warrant Holder"), is entitled to purchase from Nucleus, Inc., a Nevada
corporation (the "Company"), at any time prior to 5:00 p.m. Chicago time on the
second anniversary of the date hereof (the "Expiration Date") _______________
( ) fully paid and non-assessable shares of the Company's Common Stock, par
value $.001 per share (the "Common Stock;" the Common Stock purchasable upon
exercise of this Warrant is herein called the "Common Shares"), at a price per
share of Four and 75/100 Dollars ($4.75) (the "Exercise Price"). The number of
Common Shares purchasable hereunder and the Exercise Price are subject to
adjustment as provided below.
If the Expiration Date shall be a holiday in the State of Illinois or a
day on which banks are authorized to close in the State of Illinois, then the
Expiration Date shall be the next following day which in the State of Illinois
is not a holiday or a day on which banks are authorized to close. If this
Warrant is not exercised at or before 5:00 p.m. Illinois time, on the Expiration
Date, it shall become void, and all rights hereunder shall thereupon cease.
1. EXERCISE; FRACTIONAL SHARES.
(a) The Warrant Holder may exercise this Warrant, in whole or
in part, upon surrender of this Warrant with the Exercise Form hereon duly
executed, to the Company at Nucleus Inc., 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 00000, or at such other address as the Company may designate by notice
given to the Warrant Holder in accordance with the terms hereof, together with
payment in full of the Exercise Price in lawful money of the United States, by
wire transfer of immediately available funds or certified check or bank draft
payable in United States Dollars to the
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order of the Company, for each Common Share to be purchased and upon compliance
with and subject to the conditions set forth herein.
(b) Upon surrender of this Warrant with the Exercise Form duly
executed and accompanied by payment of the aggregate Exercise Price for the
number of Common Shares for which this Warrant is then being exercised, the
Company will cause to be issued certificates for the total number of Common
Shares for which this Warrant is being exercised as are required for delivery,
within fifteen (15) days of such exercise, to the Warrant Holder, and the
Company shall thereupon deliver such certificates to the Warrant Holder. This
Warrant shall be deemed to have been exercised in whole or in part immediately
prior to the close of business on the date this Warrant is surrendered and
payment is made as provided herein.
(c) The Company shall not be required to issue any fractional
Common Shares in connection with the exercise of this Warrant. In any case where
the Warrant Holder would be entitled under the terms of this Warrant to receive
a fraction of a Common Share upon the exercise of this Warrant, the Company
shall, upon the exercise of this Warrant and receipt of the Exercise Price,
issue the largest number of whole shares purchasable upon exercise of this
Warrant unless the Company has subdivided the shares of Common Stock. The
Company shall not be required to make any cash or other adjustment in respect of
such fraction of a Common Share to which the Warrant Holder would otherwise be
entitled and the Warrant Holder, by the acceptance of this Warrant, expressly
waives his right to receive a certificate of any fraction of a Common Share upon
the exercise hereof.
2. ADJUSTMENT.
(a) If prior to the exercise of this Warrant, the Company
shall have effected one or more stock split-ups or other subdivisions or
combinations of Common Stock, the number of Common Shares subject to this
Warrant shall (i) be proportionately increased if a net increase shall have been
effected (in the case of split-up in or subdivision of) the number of shares of
Common Stock; or (ii) be proportionately reduced if a net reduction (in the case
of a combination) shall have been effected in the number of shares in Common
Stock. Upon the occurrence of an event described in this subparagraph (a), the
Exercise Price shall be subject to a proportionate reduction under clause (i) or
a proportionate increase under clause (ii), as the case may be.
(b) In case of any capital reorganization of the Company or of
any reclassification of the Common Stock, or the consolidation or merger of the
Company with any other corporation or entity, after such capital reorganization,
reclassification, or consolidation, this Warrant will be exercisable, upon the
terms and conditions specified in this Warrant, for the number of shares of
Common Stock or other securities or property which the Warrant Holder would have
been entitled to receive upon the capital reorganization, reclassification,
consolidation or merger if this Warrant had been exercised immediately before
the first such capital reorganization, reclassification, or consolidation or
immediately before the effective date of such merger. The subdivision or
combination of Common Shares at any time outstanding into a greater or lesser
number of Common Shares shall not be deemed to be a reclassification of the
Common Shares of the Company for the purposes of this paragraph.
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(c) Whenever the number of Common Shares are adjusted, the
Company shall compute the adjusted number and the resulting adjustment to the
Exercise Price and shall prepare a certificate signed by its President or a
Vice-President setting forth the adjustment and the facts requiring the
adjustment and upon which the calculation is based, and that certificate shall
forthwith be mailed to the Warrant Holder.
(d) The form of Warrant need not be changed because of any
change in the number of Common Shares purchasable upon exercise of this Warrant
and Warrants issued after such change may state the same Exercise Price and the
same number of Common Shares as are stated in the form of Warrant initially
issued.
3. COMPANY COVENANTS.
(a) The Company covenants and agrees that at all times it
shall reserve and keep available for the exercise of this Warrant such number of
authorized Common Stock as are sufficient to permit the exercise in full of this
Warrant.
(b) The Company covenants that all Common Shares issued on
exercise of this Warrant will be validly issued, fully paid, nonassessable and
free of preemptive rights.
4. REGISTRATION RIGHTS.
The Common Shares that may be issued to the Warrant Holder upon
exercise of the Warrant are entitled to the registration rights set forth in the
Registration Rights Agreement of even date herewith between the Company and the
Warrant Holder.
5. MISCELLANEOUS.
(a) The Warrant Holder, as such, shall not be entitled to any
rights, including, without limitation, voting rights, as a shareholder of the
Company, until this Warrant shall have been exercised as provided herein.
(b) If this Warrant is lost, stolen, mutilated or destroyed,
the Company may, on such terms as to indemnity or otherwise as it may in its
discretion impose (which shall, in the case of a mutilated Warrant, include the
surrender thereof), issue a new Warrant of like denomination and tenor as, and
in substitution for, this Warrant.
(c) Prior to due presentment for registration of transfer of
this Warrant, the Company may deem and treat the Warrant Holder as the absolute
owner of this Warrant (notwithstanding any notation of ownership or other
writing hereon) for the purpose of any exercise hereof and for all other
purposes and the Company shall not be affected by any notice to the contrary.
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(d) This Warrant and the Common Shares may not be sold,
transferred, assigned, hypothecated or otherwise disposed of except to an entity
or person, who (i) in the opinion of counsel reasonably satisfactory to the
Company, is a person to whom this Warrant or Common Shares may legally be
transferred without registration under any federal or state securities law or
regulation, and (ii) who agrees to comply with the provisions of this Warrant
with respect to any further resale or disposition of such securities.
(e) All of the Company's covenants and provisions of this
Warrant shall bind and inure to the benefit of its successors and assigns
hereunder.
(f) Any notice or demand pursuant to this Warrant to be given
or made by the Warrant Holder to or on behalf of the Company shall be
sufficiently given or made when delivered or sent by registered or certified
mail, postage prepaid, return receipt requested, and addressed, until another
address is designated in writing by the Company, as follows:
Nucleus, Inc.
000 X. Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxxx, President
(g) The section headings contained herein are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Warrant.
(h) The validity, interpretation and performance of this Warrant
shall be governed by the laws of the State of Illinois.
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IN WITNESS WHEREOF, this Warrant has been duly executed by the Company
this ___ day of ___________________, 1999.
NUCLEUS, INC.
By: ___________________________
Xxxx X. Xxxxxxx, President
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EXERCISE FORM
-------------
(To be Executed by A Warrant Holder Who Desires
To Exercise The Warrant In Whole Or In Part)
___________________, 19__
Nucleus, Inc.
000 X. Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Undersigned:
( )
Please insert Tax Identification
Number Warrant Holder
hereby irrevocably elects to exercise the right of purchase represented by the
within Warrant for, and to purchase thereunder, Nucleus, Inc. _________ shares
of Common Stock, no par value $.001 per share, of Nucleus, Inc. ("Common
Shares") provided for therein (or, if adjusted pursuant to Section 3 of the
Warrant, such number of shares calculated pursuant to Section 3 thereof) and
tenders payment herewith to the order of Nucleus, Inc. in the amount of the
product of the Exercise Price, as that term is defined in the Warrant, times the
number of Common Shares purchased. The undersigned requests that certificates
for such Common Shares be issued as follows:
Name: ____________________________
Address: ____________________________
Deliver to: ____________________________
Address: ____________________________
Tax Identification
Number: ____________________________
Signature: ____________________________
Date: ____________________________
NOTE: THE SIGNATURE OF THIS EXERCISE MUST CORRESPOND WITH THE NAME AS WRITTEN
UPON THE FACE OF THIS WARRANTY IN EVERY PARTICULAR, WITHOUT ALTERATION OR
ENLARGEMENT OR ANY CHANGE WHATSOEVER.
A-6
