Exhibit 4.3
THIS WARRANT IS NON-TRANSFERABLE. NEITHER THIS WARRANT NOR THE SHARES
ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 OR UNDER ANY APPLICABLE STATE SECURITIES LAW, AND THIS
WARRANT AND SUCH SHARES MAY NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED
OR OTHERWISE DISPOSED OF IN WHOLE OR IN PART IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER THAT ACT AND APPLICABLE STATE SECURITIES LAW OR
AN EXEMPTION FROM SUCH REGISTRATION.
WARRANT TO PURCHASE SHARES OF COMMON STOCK
OF
PHP HEALTHCARE CORPORATION
PHP Healthcare Corporation, a Delaware corporation (the "Company"),
certifies that, in accordance with a certain Stock Purchase Agreement of even
date herewith among the Company, Xxxxx X. Xxxxxx (the "Registered Owner") and
Xxxx Xxxxx Xxxxxxx-Xxxxxxx (Xxxxx X. Xxxxxx and Xxxx Xxxxx Xxxxxxx-Xxxxxxx
referred to collectively herein as the "Sellers"), the Registered Owner has been
granted on the date hereof (the "Grant Date") the right, subject to the terms of
this Warrant, to purchase from the Company a total of Twenty Two Thousand Five
Hundred (22,500) fully paid and nonassessable shares of its common stock, $.01
par value per share (the "Shares"), subject to adjustment as provided herein.
1. PURCHASE PRICE.
The Registered Owner shall be entitled to purchase Seven Thousand Five
Hundred (7,500) Shares hereunder at the price of Eleven Dollars and Fifty Cents
($11.50) per share; Seven Thousand Five Hundred (7,500) Shares at the price of
Fifteen Dollars ($15.00) per share; and Seven Thousand Five Hundred (7,500)
Shares at the price of Twenty Four Dollars ($24.00) per share. Payment of the
Purchase Price shall be made in cash.
2. TERM OF WARRANT.
Subject to earlier termination in accordance with Section 5, this Warrant
shall be exercisable to the extent and in the manner provided herein for a
period of seven (7) years from the Grant Date (the "Exercise Term").
3. EXERCISABILITY OF WARRANT.
This Warrant shall entitle the Registered Owner to purchase, in whole at any
time or in part from time to time, ten percent (10%) of the Shares after the
expiration of two (2) years from the Grant Date, an additional forty percent
(40%) of the Shares after the expiration of three (3) years from the Grant Date,
and the balance of the Shares after the expiration of four (4) years
from the Grant Date. Such right of purchase shall accrue equally in respect
of Shares purchasable at each of the Purchase Prices set forth in Section 1,
and shall be cumulative and shall continue, unless sooner exercised in whole
or part or terminated as herein provided, during the remaining period of the
Exercise Term.
4. MANNER OF EXERCISE.
4.1 Subject to the terms and conditions herein, this Warrant may be
exercised by delivery of written notice to the Secretary of the Company at
the Company's principal executive office. Such notice shall state that the
Registered Owner is electing to exercise this Warrant and the number of
Shares and Purchase Price in respect of which the Warrant is being exercised
and shall be signed by the person or persons exercising the Warrant on behalf
of the Registered Owner. Such person or persons shall deliver this Warrant to
the Secretary of the Company who shall endorse thereon a notation of such
exercise, and shall provide satisfactory proof as to the authority of such
person or persons to exercise the Warrant on behalf of the Registered Owner.
4.2 The notice of exercise described in Section 4.1 shall be accompanied
by the Purchase Price for the number of Shares in respect of which this
Warrant is being exercised.
4.3 Upon receipt of notice of exercise and the Purchase Price for the
Shares in respect of which this Warrant is being exercised, the Company shall
take appropriate action to effect the transfer to the Registered Owner of the
number of Shares as to which such exercise was effective.
4.4 The Registered Owner shall not be deemed to be the holder of, or to
have any of the rights of a holder with respect to, any Shares subject to
this Warrant until (i) the Warrant shall have been exercised pursuant to the
terms hereof and the Registered Owner shall have paid the full Purchase Price
for the number of Shares in respect of which the Warrant was exercised, (ii)
the Company has complied, in its discretion, with any listing, registration
or qualification requirement of any securities exchange or of the National
Association of Securities Dealers, Inc., as the case may be, or under any
state or federal law, (iii) the Registered Owner's name shall have been
entered as a stockholder of record on the books of the Company, and (iv) the
Company shall have issued and delivered the Shares in certificate form to the
Registered Owner, whereupon the Registered Owner shall have full voting and
other ownership rights with respect to such Shares.
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5. TERMINATION.
5.1 This Warrant and all rights of the registered owner under this
Warrant shall terminate (i) upon the expiration of the Exercise Term, to the
extent not previously exercised; and (ii) if the employment of the Registered
Owner by EastWest Research Corporation ("EastWest") under the Employment and
Non-Competition Agreement of even date herewith between EastWest and the
Registered Owner (or any amendment thereto) (the "Employment Agreement") is
terminated pursuant to Section 4(a), (b), (c) or (d) thereof or the
Registered Owner terminates the Employment Agreement prior to the expiration
of its term.
5.2 This Warrant and all rights of the Registered Owner under this
Warrant shall terminate one (1) year after the Employment Agreement is
terminated pursuant to Section 4(e) or (f), but only to the extent it was
exercisable on the date the Employment Agreement was so terminated.
6. DILUTION.
6.1 If the Company shall (i) pay a dividend on its common stock in shares
of its common stock, (ii) subdivide its outstanding common stock, or (iii)
combine its outstanding common stock into a smaller number of shares, then
the Purchase Price of any Shares not yet purchased hereunder shall be
proportionately decreased in the case of such payment or subdivision, or
increased in the case of such combination; and upon such adjustment of the
Purchase Price, the Registered Owner shall thereafter be entitled to
purchase, at the new purchase price, the number of shares, calculated to the
nearest full share, obtained by multiplying the number of shares of common
stock issuable upon exercise of this Warrant immediately prior to such
adjustment by the Purchase Price in effect immediately prior to such
adjustment and dividing the product so obtained by the new purchase price.
6.2 Whenever any adjustment is required in the number of shares of common
stock for which this Warrant is exercisable, the Company shall (i) file with
its stock record books a statement describing in reasonable detail the
adjustment and the calculation used in determining that adjustment and (ii)
deliver a copy of that statement to the Registered Owner.
7. NO RIGHT TO CONTINUED EMPLOYMENT.
Nothing herein shall be interpreted or construed to confer upon the
Registered Owner any right to continued employment by EastWest or to interfere
in any way with the right of EastWest to
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terminate the Registered Owner's employment under the Employment Agreement at
any time.
8. TRANSFER RESTRICTIONS.
This Warrant is binding upon and is solely for the benefit of the parties
hereto. It shall not be transferable other than by will or the laws of descent
and distribution and is binding upon the Registered Owner's executors, heirs and
administrators. Neither this Warrant nor the shares issuable upon exercise of
this Warrant have been registered under the Securities Act of 1933 or under any
applicable state securities law, and this Warrant and such shares may not be
sold, transferred, pledged, hypothecated or otherwise disposed of in whole or in
part in the absence of an effective registration statement under that Act and
applicable state securities law or an exemption from such registration.
9. REGISTRATION RIGHTS.
9.1 In the event the Company files a registration statement under the
Securities Act of 1933 (the "Act") which relates to a public offering of its
securities (except in connection with an offering to employees) and which
offering is of a type and registered pursuant to a form of registration
statement that permits registration of the Shares, the Company agrees, upon
the written request of the Sellers, to have such registration statement and
the prospectus included therein include and relate to, and meet the
requirements of the Act with respect to, the public offering of the Shares
owned by the Sellers (the "Included Shares") so as to permit the public sale
thereof in compliance with the Act.
9.2 The Company shall give written notice to the Sellers of its intention
to file a registration statement under the Act relating to a public offering
of the aforesaid securities at least thirty (30) days prior to the filing of
such registration statement. The Sellers shall deliver their written request
to include their Shares within fifteen (15) days thereafter. Neither the
delivery of such notice by the Company nor of such request by the Sellers
shall in any way obligate the Company to file such registration statement and
notwithstanding the filing of such registration statement the Company may, at
any time prior to the effective date thereof, determine to withdraw such
registration statement without liability to the Sellers.
9.3 The Company shall supply to the Sellers two (2) executed copies of
each registration statement and that reasonable number of copies of the
preliminary, final and other prospectus in conformity with requirements of
the Act and the
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Rules and Regulations promulgated thereunder and such other documents as the
Sellers shall reasonably request.
9.4 The Company shall cooperate in taking such action as may be necessary
to register or qualify the Included Shares under such other securities acts
or blue sky laws of such jurisdictions as the Sellers shall reasonably
request and to do any and all other acts and things which may be necessary or
advisable to enable the Sellers to consummate such proposed sale or other
disposition of the Included Shares in any such jurisdiction; provided that in
no event shall the Company be obligated, in connection therewith, to qualify
to do business or to file a general consent to service of process in any
jurisdiction where it shall not then be qualified.
9.5 The Company shall keep effective for a period of not less than ninety
(90) days after the initial effectiveness thereof all such registrations
under the Act and cooperate in taking such action as may be necessary to keep
effective such other registrations and qualifications, and do any and all
other acts and things for such period--not to exceed six (6) months--as may
be necessary to permit the public sale or other disposition of the Included
Shares.
9.6 The Company shall pay the registration and filing fees, underwriting
commissions, transfer taxes, and underwriter's expense allowance attributable
to the Included Shares and the reasonable fees and expenses of the Sellers'
counsel.
9.7 In no event shall the Company be required to include Shares owned by
the Sellers in a registration statement pursuant to the requirements of this
Section 9 more than once. Such inclusion shall be conditioned upon a timely
receipt by the Company in writing of information as to the terms of such
public offering furnished by or on behalf of the Sellers, and such other
information as the Company may reasonably require from the Sellers, or any
underwriter for them, for inclusion in such registration statement.
10. AMENDMENT.
This Warrant may be amended or terminated, and any terms or condition hereof
may be waived, only by a written instrument executed on behalf of each party
hereto.
11. NOTICE.
All notices, requests, claims, demands and other communications hereunder
shall be in writing and shall be deemed to have been duly given when delivered
in person, by cable,
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telegram, telex or facsimile transmission or by registered or certified mail
(postage prepaid, return receipt requested) to the parties at the following
addresses:
If Registered Owner:
Xxxxx X. Xxxxxx
0000 XxxxXxxx Xxxxxxx
Xxxxxxxx, Xxxxxxxx 00000
If to the Company:
PHP Healthcare Corporation
0000 Xxxxxxxx Xxxx
00xx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Secretary
12. VALIDITY.
The invalidity or unenforceability of any provision of this Warrant shall
not affect the validity or enforceability of any other provisions of this
Warrant, which shall remain in full force and effect.
13. HEADINGS.
The headings contained in this Warrant are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Warrant.
14. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Virginia without giving effect to the principles of
conflicts of the laws thereof.
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15. REPRESENTATIONS.
By accepting this Warrant, the Registered Owner represents and confirms that
he has such knowledge and experience in financial and business matters that he
is capable of evaluating the merits and risks of acquiring this Warrant; that he
has received from the Company a copy of its most recent annual report on Form
10-K, its subsequent quarterly report on Form 10-Q and its most recent proxy
statement, and a brief description of the Company's common stock, and any
material changes in the Company's affairs that are not disclosed in the
foregoing; that he has had the opportunity to ask questions and receive answers
concerning the terms and conditions of this Warrant and to obtain any additional
information which the Company possesses or can acquire without unreasonable
effort or expense that is necessary to verify the accuracy of the information
furnished; and that he is familiar with the limitations on resale referred to in
Section 13.
IN WITNESS WHEREOF, the Company has caused this instrument to be signed, and
its corporate seal to be affixed hereto, as of the 1st day of November, 1992.
PHP HEALTHCARE CORPORATION
By
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[Title]
[SEAL]
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