Exhibit 10.19
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED
OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH
SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE
SECURITIES LAWS IS NOT REQUIRED.
SERIES A WARRANT TO PURCHASE
SHARES OF COMMON STOCK
OF
STATSURE DIAGNOSTIC SYSTEMS, INC.
Expires May 26, 2011
No.: W-A-06- __ Number of Shares: ___________
Date of Issuance: June 8, 2006
FOR VALUE RECEIVED, the undersigned, StatSure Diagnostic Systems, Inc., a
Delaware corporation (together with its successors and assigns, the "Issuer"),
hereby certifies that _______________________________ or its registered assigns
is entitled to subscribe for and purchase, during the Term (as hereinafter
defined), up to ____________________________________ (_____________) shares
(subject to adjustment as hereinafter provided) of the duly authorized, validly
issued, fully paid and non-assessable Common Stock of the Issuer, at an exercise
price per share equal to the Warrant Price then in effect, subject, however, to
the provisions and upon the terms and conditions hereinafter set forth.
Capitalized terms used in this Warrant and not otherwise defined herein shall
have the respective meanings specified in Section 9 hereof.
1. Term. The term of this Warrant shall commence on May 31, 2006 and shall
expire at 6:00 p.m., Eastern Time, on May 27, 2011 (such period being the
"Term").
2. Method of Exercise; Payment; Issuance of New Warrant; Transfer and
Exchange.
(a) Time of Exercise. The purchase rights represented by this Warrant may
be exercised in whole or in part during the Term beginning on November 27, 2006.
(b) Method of Exercise. The Holder hereof may exercise this Warrant, in
whole or in part, by the surrender of this Warrant (with the exercise form
attached hereto duly executed) at the principal office of the Issuer, and by the
payment to the Issuer of an amount of consideration therefor equal to the
Warrant Price in effect on the date of such exercise multiplied by the number of
shares of Warrant Stock with respect to which this Warrant is then being
exercised, payable at such Holder's election (i) by certified or official bank
check or by wire transfer to an account designated by the Issuer, (ii) by
"cashless exercise" in accordance with the provisions of subsection (c) of this
Section 2, but only when a registration statement under the Securities Act
providing for the resale of the Warrant Stock is not then in effect, or (iii) by
a combination of the foregoing methods of payment selected by the Holder of this
Warrant.
(c) Cashless Exercise. Notwithstanding any provisions herein to the
contrary and commencing one (1) year following the Original Issue Date if (i)
the Per Share Market Value of one share of Common Stock is greater than the
Warrant Price (at the date of calculation as set forth below) and (ii) a
registration statement under the Securities Act providing for the resale of the
Warrant Stock is not then in effect by the date such registration statement is
required to be effective pursuant to the Registration Rights Agreement (as
defined in the Purchase Agreement) or not effective at any time during the
Effectiveness Period (as defined in the Registration Rights Agreement) in
accordance with the terms of the Registration Rights Agreement, unless the
registration statement is not effective as a result of the Issuer exercising its
rights under Section 3(i) of the Registration Rights Agreement, in lieu of
exercising this Warrant by payment of cash, the Holder may exercise this Warrant
by a cashless exercise and shall receive the number of shares of Common Stock
equal to an amount (as determined below) by surrender of this Warrant at the
principal office of the Issuer together with the properly endorsed Notice of
Exercise in which event the Issuer shall issue to the Holder a number of shares
of Common Stock computed using the following formula:
X = Y - (A)(Y)
------
B
Where X = the number of shares of Common Stock to be issued to the
Holder.
Y = the number of shares of Common Stock purchasable
upon exercise of all of the Warrant or, if only a
portion of the Warrant is being exercised, the
portion of the Warrant being exercised.
A = the Warrant Price.
B = the Per Share Market Value of one share of Common Stock.
(d) Issuance of Stock Certificates. In the event of any exercise of this
Warrant in accordance with and subject to the terms and conditions hereof, (i)
certificates for the shares of Warrant Stock so purchased shall be dated the
date of such exercise and delivered to the Holder hereof within a reasonable
time, not exceeding three (3) Trading Days after such exercise (the "Delivery
Date") or, at the request of the Holder (provided that a registration statement
under the Securities Act providing for the resale of the Warrant Stock is then
in effect), issued and delivered to the Depository Trust Company ("DTC") account
on the Holder's behalf via the Deposit Withdrawal Agent Commission System
("DWAC") within a reasonable time, not exceeding three (3) Trading Days after
such exercise, and the Holder hereof shall be deemed for all purposes to be the
holder of the shares of Warrant Stock so purchased as of the date of such
exercise and (ii) unless this Warrant has expired, a new Warrant representing
the number of shares of Warrant Stock, if any, with respect to which this
Warrant shall not then have been exercised (less any amount thereof which shall
have been canceled in payment or partial payment of the Warrant Price as
hereinabove provided) shall also be issued to the Holder hereof at the Issuer's
expense within such time. Notwithstanding the foregoing to the contrary, the
Issuer or its transfer agent shall only be obligated to issue and deliver the
shares to the DTC on a holder's behalf via DWAC if such exercise is in
connection with a sale and the Issuer and its transfer agent are participating
in DTC through the DWAC system.
(e) Compensation for Buy-In on Failure to Timely Deliver Certificates Upon
Exercise. In addition to any other rights available to the Holder, if the Issuer
fails to cause its transfer agent to transmit to the Holder a certificate or
certificates representing the Warrant Stock pursuant to an exercise on or before
the Delivery Date, and if after such date the Holder is required by its broker
to purchase (in an open market transaction or otherwise) shares of Common Stock
to deliver in satisfaction of a sale by the Holder of the Warrant Stock which
the Holder anticipated receiving upon such exercise (a "Buy-In"), then the
Issuer shall (1) pay in cash to the Holder the amount by which (x) the Holder's
total purchase price (including brokerage commissions, if any) for the shares of
Common Stock so purchased exceeds (y) the amount obtained by multiplying (A) the
number of shares of Warrant Stock that the Issuer was required to deliver to the
Holder in connection with the exercise at issue times (B) the price at which the
sell order giving rise to such purchase obligation was executed, and (2) at the
option of the Holder, either reinstate the portion of the Warrant and equivalent
number of shares of Warrant Stock for which such exercise was not honored or
deliver to the Holder the number of shares of Common Stock that would have been
issued had the Issuer timely complied with its exercise and delivery obligations
hereunder. For example, if the Holder purchases Common Stock having a total
purchase price of $11,000 to cover a Buy-In with respect to an attempted
exercise of shares of Common Stock with an aggregate sale price giving rise to
such purchase obligation of $10,000, under clause (1) of the immediately
preceding sentence the Issuer shall be required to pay the Holder $1,000. The
Holder shall provide the Issuer written notice indicating the amounts payable to
the Holder in respect of the Buy-In, together with applicable confirmations and
other evidence reasonably requested by the Issuer. Nothing herein shall limit a
Holder's right to pursue any other remedies available to it hereunder, at law or
in equity including, without limitation, a decree of specific performance and/or
injunctive relief with respect to the Issuer's failure to timely deliver
certificates representing shares of Common Stock upon exercise of this Warrant
as required pursuant to the terms hereof.
(f) Transferability of Warrant. Subject to Section 2(h) hereof, this
Warrant may be transferred by a Holder without the consent of the Issuer. If
transferred pursuant to this paragraph, this Warrant may be transferred on the
books of the Issuer by the Holder hereof in person or by duly authorized
attorney, upon surrender of this Warrant at the principal office of the Issuer,
properly endorsed (by the Holder executing an assignment in the form attached
hereto) and upon payment of any necessary transfer tax or other governmental
charge imposed upon such transfer. This Warrant is exchangeable at the principal
office of the Issuer for Warrants to purchase the same aggregate number of
shares of Warrant Stock, each new Warrant to represent the right to purchase
such number of shares of Warrant Stock as the Holder hereof shall designate at
the time of such exchange. All Warrants issued on transfers or exchanges shall
be dated the Original Issue Date and shall be identical with this Warrant except
as to the number of shares of Warrant Stock issuable pursuant thereto.
(g) Continuing Rights of Holder. The Issuer will, at the time of or at any
time after each exercise of this Warrant, upon the request of the Holder hereof,
acknowledge in writing the extent, if any, of its continuing obligation to
afford to such Holder all rights to which such Holder shall continue to be
entitled after such exercise in accordance with the terms of this Warrant,
provided that if any such Holder shall fail to make any such request, the
failure shall not affect the continuing obligation of the Issuer to afford such
rights to such Holder.
(h) Compliance with Securities Laws.
(i) The Holder of this Warrant, by acceptance hereof, acknowledges
that this Warrant and the shares of Warrant 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 this Warrant or any
shares of Warrant Stock to be issued upon exercise hereof except pursuant
to an effective registration statement, or an exemption from registration,
under the Securities Act and any applicable state securities laws.
(ii) Except as provided in paragraph (iii) below, this Warrant and
all certificates representing shares of Warrant Stock issued upon exercise
hereof shall be stamped or imprinted with a legend in substantially the
following form:
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE
HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS AND MAY NOT BE
SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE
SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR THE ISSUER
SHALL HAVE RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
ISSUER THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND
UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.
(iii) The Issuer agrees to reissue this Warrant or certificates
representing any of the Warrant Stock, without the legend set forth above
if at such time, prior to making any transfer of any such securities, the
Holder shall give written notice to the Issuer describing the manner and
terms of such transfer. Such proposed transfer will not be effected until:
(a) either (i) the Issuer has received an opinion of counsel reasonably
satisfactory to the Issuer, to the effect that the registration of such
securities under the Securities Act is not required in connection with
such proposed transfer, (ii) a registration statement under the Securities
Act covering such proposed disposition has been filed by the Issuer with
the Securities and Exchange Commission and has become effective under the
Securities Act and the Holder has represented that the Warrant Stock has
been or will be sold, (iii) the Issuer has received other evidence
reasonably satisfactory to the Issuer that such registration and
qualification under the Securities Act and state securities laws are not
required, or (iv) the Holder provides the Issuer with reasonable
assurances that such security can be sold pursuant to Rule 144 under the
Securities Act; and (b) either (i) the Issuer has received an opinion of
counsel reasonably satisfactory to the Issuer, to the effect that
registration or qualification under the securities or "blue sky" laws of
any state is not required in connection with such proposed disposition, or
(ii) compliance with applicable state securities or "blue sky" laws has
been effected or a valid exemption exists with respect thereto. The Issuer
will respond to any such notice from a holder within three (3) business
days. In the case of any proposed transfer under this Section 2(h), the
Issuer will use reasonable efforts to comply with any such applicable
state securities or "blue sky" laws, but shall in no event be required,
(x) to qualify to do business in any state where it is not then qualified,
(y) to take any action that would subject it to tax or to the general
service of process in any state where it is not then subject, or (z) to
comply with state securities or "blue sky" laws of any state for which
registration by coordination is unavailable to the Issuer. The
restrictions on transfer contained in this Section 2(h) shall be in
addition to, and not by way of limitation of, any other restrictions on
transfer contained in any other section of this Warrant. Whenever a
certificate representing the Warrant Stock is required to be issued to a
the Holder without a legend, in lieu of delivering physical certificates
representing the Warrant Stock, the Issuer shall use its reasonable best
efforts to cause its transfer agent to electronically transmit the Warrant
Stock to the Holder by crediting the account of the Holder's Prime Broker
with DTC through its DWAC system (to the extent not inconsistent with any
provisions of this Warrant or the Purchase Agreement). Notwithstanding the
foregoing to the contrary, the Issuer or its transfer agent shall only be
obligated to issue and deliver the shares to the DTC on a holder's behalf
via DWAC if such exercise is in connection with a sale and the Issuer and
its transfer agent are participating in DTC through the DWAC system.
(i) Accredited Investor Status. In no event may the Holder exercise this
Warrant in whole or in part unless the Holder is an "accredited investor" as
defined in Regulation D under the Securities Act.
3. Stock Fully Paid; Reservation and Listing of Shares; Covenants.
(a) Stock Fully Paid. The Issuer represents, warrants, covenants and
agrees that all shares of Warrant Stock which may be issued upon the exercise of
this Warrant or otherwise hereunder will, when issued in accordance with the
terms of this Warrant, be duly authorized, validly issued, fully paid and
nonassessable and free from all taxes, liens and charges created by or through
the Issuer. The Issuer further covenants and agrees that during the period
within which this Warrant may be exercised, the Issuer will at all times have
authorized and reserved for the purpose of issuance upon exercise of this
Warrant a number of shares of Common Stock equal to at least one hundred ten
percent (110%) of the aggregate number of shares of Common Stock to provide for
the exercise of this Warrant.
(b) Reservation. If any shares of Common Stock required to be reserved for
issuance upon exercise of this Warrant or as otherwise provided hereunder
require registration or qualification with any governmental authority under any
federal or state law before such shares may be so issued, the Issuer will in
good faith use its best efforts as expeditiously as possible at its expense to
cause such shares to be duly registered or qualified. If the Issuer shall list
any shares of Common Stock on any securities exchange or market it will, at its
expense, list thereon, maintain and increase when necessary such listing, of,
all shares of Warrant Stock from time to time issued upon exercise of this
Warrant or as otherwise provided hereunder (provided that such Warrant Stock has
been registered pursuant to a registration statement under the Securities Act
then in effect), and, to the extent permissible under the applicable securities
exchange rules, all unissued shares of Warrant Stock which are at any time
issuable hereunder, so long as any shares of Common Stock shall be so listed.
The Issuer will also so list on each securities exchange or market, and will
maintain such listing of, any other securities which the Holder of this Warrant
shall be entitled to receive upon the exercise of this Warrant if at the time
any securities of the same class shall be listed on such securities exchange or
market by the Issuer.
(c) Covenants. The Issuer shall not by any action including, without
limitation, amending the Articles of Incorporation or the by-laws of the Issuer,
or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other action, avoid or seek to
avoid the observance or performance of any of the terms of this Warrant, but
will at all times in good faith assist in the carrying out of all such terms and
in the taking of all such actions as may be necessary or appropriate to protect
the rights of the Holder hereof against dilution (to the extent specifically
provided herein) or impairment. Without limiting the generality of the
foregoing, the Issuer will (i) not permit the par value, if any, of its Common
Stock to exceed the then effective Warrant Price, (ii) not amend or modify any
provision of the Articles of Incorporation or by-laws of the Issuer in any
manner that would adversely affect the rights of the Holders of the Warrants,
(iii) take all such action as may be reasonably necessary in order that the
Issuer may validly and legally issue fully paid and nonassessable shares of
Common Stock, free and clear of any liens, claims, encumbrances and restrictions
(other than as provided herein) upon the exercise of this Warrant, and (iv) use
its best efforts to obtain all such authorizations, exemptions or consents from
any public regulatory body having jurisdiction thereof as may be reasonably
necessary to enable the Issuer to perform its obligations under this Warrant.
(d) Loss, Theft, Destruction of Warrants. Upon receipt of evidence
satisfactory to the Issuer of the ownership of and the loss, theft, destruction
or mutilation of any Warrant and, in the case of any such loss, theft or
destruction, upon receipt of indemnity or security satisfactory to the Issuer
or, in the case of any such mutilation, upon surrender and cancellation of such
Warrant, the Issuer will make and deliver, in lieu of such lost, stolen,
destroyed or mutilated Warrant, a new Warrant of like tenor and representing the
right to purchase the same number of shares of Common Stock.
4. Adjustment of Warrant Price. The price at which such shares of Warrant
Stock may be purchased upon exercise of this Warrant shall be subject to
adjustment from time to time as set forth in this Section 4. The Issuer shall
give the Holder notice of any event described below which requires an adjustment
pursuant to this Section 4 in accordance with the notice provisions set forth in
Section 5.
(a) Adjustments for Certain Specified Events. If at any time:
(1) the Company does not execute a transaction with Chembio
and Inverness substantially on the same terms as those
outlined in the appendix to that certain Term Sheet
between the Company and Chardan Capital Markets dated
May 8, 2006, by midnight July 31st, 2006 or;
(2) Chembio does not receive FDA Pre-Market Approval for the
manufacture of the StatSure Licensed Test by July 31st,
2006, then
the Exercise Price shall be adjusted to $1.00 per share.
(b) Adjustments for Stock Splits and Combinations. If the Company shall at
any time or from time to time after the Issuance Date, effect a stock split of
the outstanding Common Stock, the Exercise Price shall be proportionately
decreased. If the Company shall at any time or from time to time after the
Issuance Date, combine the outstanding shares of Common Stock, the Exercise
Price shall be proportionately increased. Any adjustments under this Section
4(b) shall be effective at the close of business on the date the stock split or
combination becomes effective
(c) Adjustments for Certain Dividends and Distributions. If the Company
shall at any time or from time to time after the Issuance Date, make or issue or
set a record date for the determination of holders of Common Stock entitled to
receive a dividend or other distribution payable in shares of Common Stock,
then, and in each event, the Exercise Price shall be decreased as of the time of
such issuance or, in the event such record date shall have been fixed, as of the
close of business on such record date, by multiplying the Exercise Price then in
effect by a fraction:
the numerator of which shall be the total number of shares of
Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date; and
the denominator of which shall be the total number of shares
of Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date plus the number of shares
of Common Stock issuable in payment of such dividend or distribution.
(d) Adjustment for Other Dividends and Distributions. If the Company shall
at any time or from time to time after the Issuance Date, make or issue or set a
record date for the determination of holders of Common Stock entitled to receive
a dividend or other distribution payable in securities of the Company other than
shares of Common Stock, then, and in each event, an appropriate revision to the
applicable Exercise Price shall be made and provision shall be made (by
adjustments of the Exercise Price or otherwise) so that the holders of the
Warrants shall receive upon exercise thereof, in addition to the number of
shares of Common Stock receivable thereon, the number of securities of the
Company which they would have received had their Warrants been exercised on the
date of such event and had thereafter, during the period from the date of such
event to and including the Exercise Date, retained such securities (together
with any distributions payable thereon during such period), giving application
to all adjustments called for during such period under this Section 4(d) with
respect to the rights of the holders; provided, however, that if such record
date shall have been fixed and such dividend is not fully paid or if such
distribution is not fully made on the date fixed therefor, the Exercise Price
shall be adjusted pursuant to this paragraph as of the time of actual payment of
such dividends or distributions; and provided further, however, that no such
adjustment shall be made if the holders simultaneously receive (i) a dividend or
other distribution of shares of Common Stock in a number equal to the number of
shares of Common Stock as they would have received if all outstanding Warrants
had been exercised on the date of such event or (ii) a dividend or other
distribution of shares equal to the number of additional shares of Common Stock
being issued with respect to each share of Common Stock in such dividend or
distribution.
(e) Recapitalization, Reorganization, Reclassification, Consolidation,
Merger or Sale.
(i) In case the Issuer after the Original Issue Date shall do any of
the following (each, a "Triggering Event"): (a) consolidate or merge with
or into any other Person and the Issuer shall not be the continuing or
surviving corporation of such consolidation or merger, or (b) permit any
other Person to consolidate with or merge into the Issuer and the Issuer
shall be the continuing or surviving Person but, in connection with such
consolidation or merger, any Capital Stock of the Issuer shall be changed
into or exchanged for Securities of any other Person or cash or any other
property, or (c) transfer all or substantially all of its properties or
assets to any other Person, or (d) effect a capital reorganization or
reclassification of its Capital Stock, then, and in the case of each such
Triggering Event, proper provision shall be made so that, upon the basis
and the terms and in the manner provided in this Warrant, the Holder of
this Warrant shall be entitled upon the exercise hereof at any time after
the consummation of such Triggering Event, to the extent this Warrant is
not exercised prior to such Triggering Event, to receive at the Warrant
Price in effect at the time immediately prior to the consummation of such
Triggering Event in lieu of the Common Stock issuable upon such exercise
of this Warrant prior to such Triggering Event, the Securities, cash and
property to which such Holder would have been entitled upon the
consummation of such Triggering Event if such Holder had exercised the
rights represented by this Warrant immediately prior thereto (including
the right of a shareholder to elect the type of consideration it will
receive upon a Triggering Event), subject to adjustments (subsequent to
such corporate action) as nearly equivalent as possible to the adjustments
provided for elsewhere in this Section 4; provided, however, in the event
that the Per Share Market Value is less than the Warrant Price at the time
of such Triggering Event, the Holder shall receive an amount in cash equal
to the value of this Warrant calculated in accordance with the
Black-Scholes formula. Notwithstanding the foregoing to the contrary, this
Section 4(e)(i) shall only apply if the surviving entity pursuant to any
such Triggering Event is a company that has a class of equity securities
registered pursuant to the Securities Exchange Act of 1934, as amended,
and its common stock is listed or quoted on a national securities
exchange, national automated quotation system or the OTC Bulletin Board.
In the event that the surviving entity pursuant to any such Triggering
Event is not a public company that is registered pursuant to the
Securities Exchange Act of 1934, as amended, or its common stock is not
listed or quoted on a national securities exchange, national automated
quotation system or the OTC Bulletin Board, then the Holder shall have the
right to demand that the Issuer pay to the Holder an amount in cash equal
to the value of this Warrant calculated in accordance with the
Black-Scholes formula.
(ii) Notwithstanding anything contained in this Warrant to the
contrary and so long as the surviving entity pursuant to any Triggering
Event is a company that has a class of equity securities registered
pursuant to the Securities Exchange Act of 1934, as amended, and its
common stock is listed or quoted on a national securities exchange,
national automated quotation system or the OTC Bulletin Board, a
Triggering Event shall not be deemed to have occurred if, prior to the
consummation thereof, each Person (other than the Issuer) which may be
required to deliver any Securities, cash or property upon the exercise of
this Warrant as provided herein shall assume, by written instrument
delivered to, and reasonably satisfactory to, the Holder of this Warrant,
(A) the obligations of the Issuer under this Warrant (and if the Issuer
shall survive the consummation of such Triggering Event, such assumption
shall be in addition to, and shall not release the Issuer from, any
continuing obligations of the Issuer under this Warrant) and (B) the
obligation to deliver to such Holder such Securities, cash or property as,
in accordance with the foregoing provisions of this subsection (b), such
Holder shall be entitled to receive, and such Person shall have similarly
delivered to such Holder an opinion of counsel for such Person, which
counsel shall be reasonably satisfactory to such Holder, or in the
alternative, a written acknowledgement executed by the President or Chief
Financial Officer of the Issuer, stating that this Warrant shall
thereafter continue in full force and effect and the terms hereof
(including, without limitation, all of the provisions of this subsection
(b)) shall be applicable to the Securities, cash or property which such
Person may be required to deliver upon any exercise of this Warrant or the
exercise of any rights pursuant hereto.
(f) Issuance of Additional Shares of Common Stock.
(i) For a period of three (3) years following the Original
Issue Date, in the event the Issuer shall at any time following the
Original Issue Date issue any Additional Shares of Common Stock
(otherwise than as provided in the foregoing subsections (b) through
(d)) of this Section 4), at a price per share less than the Warrant
Price then in effect or without consideration, then the Warrant
Price upon each such issuance shall be adjusted to the same price as
the Additional Shares of Common Stock.
(ii) For a period of two (2) years following the three-year
period described above in the foregoing subsection (f)(i), in the
event the Issuer shall at any time following the Original Issue Date
issue any Additional Shares of Common Stock (otherwise than as
provided in the foregoing subsections (b) through (e)) of this
Section 4), at a price per share less than the Warrant Price then in
effect or without consideration, then the Warrant Price upon each
such issuance shall be adjusted to that price determined by
multiplying the Warrant Price then in effect by a fraction:
(A) the numerator of which shall be equal to the sum of (x)
the number of shares of Outstanding Common Stock immediately prior
to the issuance of such Additional Shares of Common Stock plus (y)
the number of shares of Common Stock (rounded to the nearest whole
share) which the aggregate consideration for the total number of
such Additional Shares of Common Stock so issued would purchase at a
price per share equal to the Warrant Price then in effect, and
(B) the denominator of which shall be equal to the number of
shares of Outstanding Common Stock immediately after the issuance of
such Additional Shares of Common Stock.
(iii) No adjustment of the number of shares of Common Stock
for which this Warrant shall be exercisable shall be made under
paragraph (i) or (ii) of Section 4(f) upon the issuance of any
Additional Shares of Common Stock which are issued pursuant to the
exercise of any Common Stock Equivalents, if any such adjustment
shall previously have been made upon the issuance of such Common
Stock Equivalents (or upon the issuance of any warrant or other
rights therefore) pursuant to Section 4(g).
(g) Issuance of Common Stock Equivalents. For a period of three (3) years
following the Original Issue Date and then the following two (2) year period, if
at any time the Issuer shall take a record of the holders of its Common Stock
for the purpose of entitling them to receive a distribution of, or shall in any
manner (whether directly or by assumption in a merger in which the Issuer is the
surviving corporation) issue or sell, any Common Stock Equivalents, whether or
not the rights to exchange or convert thereunder are immediately exercisable,
and the price per share for which Common Stock is issuable upon such conversion
or exchange shall be less than the Warrant Price in effect immediately prior to
the time of such issue or sale, or if, after any such issuance of Common Stock
Equivalents, the price per share for which Additional Shares of Common Stock may
be issuable thereafter is amended or adjusted, and such price as so amended
shall be less than the Warrant Price in effect at the time of such amendment or
adjustment, then the Warrant Price then in effect shall be adjusted as provided
in Section 4(f). No further adjustments of the number of shares of Common Stock
for which this Warrant is exercisable and the Warrant Price then in effect shall
be made upon the actual issue of such Common Stock upon conversion or exchange
of such Common Stock Equivalents.
(h) Superseding Adjustment. If, at any time after any adjustment of the number
of shares of Common Stock for which this Warrant is exercisable and the Warrant
Price then in effect shall have been made pursuant to Section 4(f) as the result
of any issuance of Common Stock Equivalents, and (i) such Common Stock
Equivalents, or the right of conversion or exchange in such Common Stock
Equivalents, shall expire, and all or a portion of such or the right of
conversion or exchange with respect to all or a portion of such Common Stock
Equivalents, as the case may be, shall not have been exercised, or (ii) the
consideration per share for which shares of Common Stock are issuable pursuant
to such Common Stock Equivalents shall be increased, then such previous
adjustment shall be rescinded and annulled and the Additional Shares of Common
Stock which were deemed to have been issued by virtue of the computation made in
connection with the adjustment so rescinded and annulled shall no longer be
deemed to have been issued by virtue of such computation. Upon the occurrence of
an event set forth in this Section 4(g), there shall be a recomputation made of
the effect of such Common Stock Equivalents on the basis of: (i) treating the
number of Additional Shares of Common Stock theretofore actually issued or
issuable pursuant to the previous exercise of Common Stock Equivalents or any
such right of conversion or exchange, as having been issued on the date or dates
of any such exercise and for the consideration actually received and receivable
therefore, and (ii) treating any such Common Stock Equivalents which then remain
outstanding as having been granted or issued immediately after the time of such
increase of the consideration per share for which Additional Shares of Common
Stock are issuable under such Common Stock Equivalents; whereupon a new
adjustment of the number of shares of Common Stock for which this Warrant is
exercisable and the Warrant Price then in effect shall be made, which new
adjustment shall supersede the previous adjustment so rescinded and annulled.
(i) Other Provisions applicable to Adjustments under this Section. The
following provisions shall be applicable to the making of adjustments of the
number of shares of Common Stock for which this Warrant is exercisable and the
Warrant Price then in effect provided for in this Section 4:
(i) Computation of Consideration. To the extent that any Additional
Shares of Common Stock or any Common Stock Equivalents (or any warrants or other
rights therefor) shall be issued for cash consideration, the consideration
received by the Issuer therefor shall be the amount of the cash received by the
Issuer therefor, or, if such Additional Shares of Common Stock or Common Stock
Equivalents are offered by the Issuer for subscription, the subscription price,
or, if such Additional Shares of Common Stock or Common Stock Equivalents are
sold to underwriters or dealers for public offering without a subscription
offering, the initial public offering price (in any such case subtracting any
amounts paid or receivable for accrued interest or accrued dividends and without
taking into account any compensation, discounts or expenses paid or incurred by
the Issuer for and in the underwriting of, or otherwise in connection with, the
issuance thereof). In connection with any merger or consolidation in which the
Issuer is the surviving corporation (other than any consolidation or merger in
which the previously outstanding shares of Common Stock of the Issuer shall be
changed to or exchanged for the stock or other securities of another
corporation), the amount of consideration therefore shall be, deemed to be the
fair value, as determined reasonably and in good faith by the Board, of such
portion of the assets and business of the nonsurviving corporation as the Board
may determine to be attributable to such shares of Common Stock or Common Stock
Equivalents, as the case may be. The consideration for any Additional Shares of
Common Stock issuable pursuant to any warrants or other rights to subscribe for
or purchase the same shall be the consideration received by the Issuer for
issuing such warrants or other rights plus the additional consideration payable
to the Issuer upon exercise of such warrants or other rights. The consideration
for any Additional Shares of Common Stock issuable pursuant to the terms of any
Common Stock Equivalents shall be the consideration received by the Issuer for
issuing warrants or other rights to subscribe for or purchase such Common Stock
Equivalents, plus the consideration paid or payable to the Issuer in respect of
the subscription for or purchase of such Common Stock Equivalents, plus the
additional consideration, if any, payable to the Issuer upon the exercise of the
right of conversion or exchange in such Common Stock Equivalents. In the event
of any consolidation or merger of the Issuer in which the Issuer is not the
surviving corporation or in which the previously outstanding shares of Common
Stock of the Issuer shall be changed into or exchanged for the stock or other
securities of another corporation, or in the event of any sale of all or
substantially all of the assets of the Issuer for stock or other securities of
any corporation, the Issuer shall be deemed to have issued a number of shares of
its Common Stock for stock or securities or other property of the other
corporation computed on the basis of the actual exchange ratio on which the
transaction was predicated, and for a consideration equal to the fair market
value on the date of such transaction of all such stock or securities or other
property of the other corporation. In the event any consideration received by
the Issuer for any securities consists of property other than cash, the fair
market value thereof at the time of issuance or as otherwise applicable shall be
as determined in good faith by the Board. In the event Common Stock is issued
with other shares or securities or other assets of the Issuer for consideration
which covers both, the consideration computed as provided in this Section
4(h)(i) shall be allocated among such securities and assets as determined in
good faith by the Board.
(ii) When Adjustments to Be Made. The adjustments required by this
Section 4 shall be made whenever and as often as any specified event requiring
an adjustment shall occur, except that any adjustment of the number of shares of
Common Stock for which this Warrant is exercisable that would otherwise be
required may be postponed (except in the case of a subdivision or combination of
shares of the Common Stock, as provided for in Section 4(c)) up to, but not
beyond the date of exercise if such adjustment either by itself or with other
adjustments not previously made adds or subtracts less than one percent (1%) of
the shares of Common Stock for which this Warrant is exercisable immediately
prior to the making of such adjustment. Any adjustment representing a change of
less than such minimum amount (except as aforesaid) which is postponed shall be
carried forward and made as soon as such adjustment, together with other
adjustments required by this Section 4 and not previously made, would result in
a minimum adjustment or on the date of exercise. For the purpose of any
adjustment, any specified event shall be deemed to have occurred at the close of
business on the date of its occurrence.
(iii) Fractional Interests. In computing adjustments under this
Section 4, fractional interests in Common Stock shall be taken into account to
the nearest one one-hundredth (1/100th) of a share.
(iv) When Adjustment Not Required. If the Issuer shall take a record
of the holders of its Common Stock for the purpose of entitling them to receive
a dividend or distribution or subscription or purchase rights and shall,
thereafter and before the distribution to stockholders thereof, legally abandon
its plan to pay or deliver such dividend, distribution, subscription or purchase
rights, then thereafter no adjustment shall be required by reason of the taking
of such record and any such adjustment previously made in respect thereof shall
be rescinded and annulled.
(v) Certain Issues Excepted. Anything herein to the contrary
notwithstanding, the Company shall not be required to make any adjustment to the
Exercise Price upon (i) securities issued (other than for cash) in connection
with a merger, acquisition, or consolidation, (ii) securities issued pursuant to
the conversion or exercise of convertible or exercisable securities issued or
outstanding on or prior to the date of the Purchase Agreement or issued pursuant
to the Purchase Agreement (so long as the conversion or exercise price in such
securities are not amended to lower such price and/or adversely affect the
holders), (iii) securities issued in connection with bona fide strategic license
agreements or other partnering arrangements so long as such issuances are not
primarily for the purpose of raising capital, (iv) Common Stock issued or the
issuance or grants of options to purchase Common Stock pursuant to the Issuer's
stock option plans and employee stock purchase plans outstanding as they exist
on the date of the Purchase Agreement, (v) Common Stock issued as payment of
dividends on the Series A Preferred Stock and (vi) any warrants issued to the
placement agent and its designees for the transactions contemplated by the
Purchase Agreement.
(j) Form of Warrant after Adjustments. The form of this Warrant need not
be changed because of any adjustments in the Warrant Price or the number and
kind of Securities purchasable upon the exercise of this Warrant.
(k) Escrow of Warrant Stock. If after any property becomes distributable
pursuant to this Section 4 by reason of the taking of any record of the holders
of Common Stock, but prior to the occurrence of the event for which such record
is taken, and the Holder exercises this Warrant, any shares of Common Stock
issuable upon exercise by reason of such adjustment shall be deemed the last
shares of Common Stock for which this Warrant is exercised (notwithstanding any
other provision to the contrary herein) and such shares or other property shall
be held in escrow for the Holder by the Issuer to be issued to the Holder upon
and to the extent that the event actually takes place, upon payment of the
current Warrant Price. Notwithstanding any other provision to the contrary
herein, if the event for which such record was taken fails to occur or is
rescinded, then such escrowed shares shall be cancelled by the Issuer and
escrowed property returned.
5. Notice of Adjustments. Whenever the Warrant Price or Warrant Share
Number shall be adjusted pursuant to Section 4 hereof (for purposes of this
Section 5, each an "adjustment"), the Issuer shall cause its Chief Financial
Officer to prepare and execute a certificate setting forth, in reasonable
detail, the event requiring the adjustment, the amount of the adjustment, the
method by which such adjustment was calculated (including a description of the
basis on which the Board made any determination hereunder), and the Warrant
Price and Warrant Share Number after giving effect to such adjustment, and shall
cause copies of such certificate to be delivered to the Holder of this Warrant
promptly after each adjustment. Any dispute between the Issuer and the Holder of
this Warrant with respect to the matters set forth in such certificate may at
the option of the Holder of this Warrant be submitted to a national or regional
accounting firm reasonably acceptable to the Issuer and the Holder, provided
that the Issuer shall have ten (10) days after receipt of notice from such
Holder of its selection of such firm to object thereto, in which case such
Holder shall select another such firm and the Issuer shall have no such right of
objection. The firm selected by the Holder of this Warrant as provided in the
preceding sentence shall be instructed to deliver a written opinion as to such
matters to the Issuer and such Holder within thirty (30) days after submission
to it of such dispute. Such opinion shall be final and binding on the parties
hereto. The costs and expenses of the initial accounting firm shall be paid
equally by the Issuer and the Holder and, in the case of an objection by the
Issuer, the costs and expenses of the subsequent accounting firm shall be paid
in full by the Issuer.
6. Fractional Shares. No fractional shares of Warrant Stock will be issued
in connection with any exercise hereof, but in lieu of such fractional shares,
the Issuer shall round the number of shares to be issued upon exercise up to the
nearest whole number of shares.
7. Ownership Cap and Exercise Restriction. Notwithstanding anything to the
contrary set forth in this Warrant, at no time may a Holder of this Warrant
exercise this Warrant if the number of shares of Common Stock to be issued
pursuant to such exercise would exceed, when aggregated with all other shares of
Common Stock owned by such Holder at such time, the number of shares of Common
Stock which would result in such Holder beneficially owning (as determined in
accordance with Section 13(d) of the Exchange Act and the rules thereunder) in
excess of 4.99% of the then issued and outstanding shares of Common Stock;
provided, however, that upon a holder of this Warrant providing the Issuer with
sixty-one (61) days notice (pursuant to Section 13 hereof) (the "Waiver Notice")
that such Holder would like to waive this Section 7 with regard to any or all
shares of Common Stock issuable upon exercise of this Warrant, this Section 7
will be of no force or effect with regard to all or a portion of the Warrant
referenced in the Waiver Notice; provided, further, that this provision shall be
of no further force or effect during the sixty-one (61) days immediately
preceding the expiration of the term of this Warrant.
8. Intentionally Left Blank.
9. Definitions. For the purposes of this Warrant, the following terms have
the following meanings:
"Additional Shares of Common Stock" means all shares of Common Stock
issued by the Issuer after the Original Issue Date, and all shares of
Other Common, if any, issued by the Issuer after the Original Issue Date,
except: (i) securities issued (other than for cash) in connection with a
merger, acquisition, or consolidation, (ii) securities issued pursuant to
the conversion or exercise of convertible or exercisable securities issued
or outstanding on or prior to the date of the Purchase Agreement or issued
pursuant to the Purchase Agreement (so long as the conversion or exercise
price in such securities are not amended to lower such price and/or
adversely affect the Holders), (iii) the Warrant Stock, (iv) securities
issued in connection with bona fide strategic license agreements or other
joint venture or partnering arrangements so long as such issuances are not
for the primary purpose of raising capital, (v) Common Stock issued or the
issuance or grants of options to purchase Common Stock pursuant to the
Issuer's stock option plans and employee stock purchase plans outstanding
as they exist on the date of the Purchase Agreement, (vi) Common Stock
issued as payment of dividends on the Series A Preferred Stock issued
pursuant to the Purchase Agreement (vii) any warrants issued to the
placement agent and its designees for the transactions contemplated by the
Purchase Agreement.
"Articles of Incorporation" means the Articles of Incorporation of
the Issuer as in effect on the Original Issue Date, and as hereafter from
time to time amended, modified, supplemented or restated in accordance
with the terms hereof and thereof and pursuant to applicable law.
"Board" shall mean the Board of Directors of the Issuer.
"Capital Stock" means and includes (i) any and all shares,
interests, participations or other equivalents of or interests in (however
designated) corporate stock, including, without limitation, shares of
preferred or preference stock, (ii) all partnership interests (whether
general or limited) in any Person which is a partnership, (iii) all
membership interests or limited liability company interests in any limited
liability company, and (iv) all equity or ownership interests in any
Person of any other type.
"Common Stock" means the Common Stock, $0.001 par value per share,
of the Issuer and any other Capital Stock into which such stock may
hereafter be changed.
"Common Stock Equivalent" means any Convertible Security or warrant,
option or other right to subscribe for or purchase any Additional Shares
of Common Stock or any Convertible Security.
"Convertible Securities" means evidences of Indebtedness, shares of
Capital Stock or other Securities which are or may be at any time
convertible into or exchangeable for Additional Shares of Common Stock.
The term "Convertible Security" means one of the Convertible Securities.
"Governmental Authority" means any governmental, regulatory or
self-regulatory entity, department, body, official, authority, commission,
board, agency or instrumentality, whether federal, state or local, and
whether domestic or foreign.
"Holders" mean the Persons who shall from time to time own any
Warrant. The term "Holder" means one of the Holders.
"Independent Appraiser" means a nationally recognized or major
regional investment banking firm or firm of independent certified public
accountants of recognized standing (which may be the firm that regularly
examines the financial statements of the Issuer) that is regularly engaged
in the business of appraising the Capital Stock or assets of corporations
or other entities as going concerns, and which is not affiliated with
either the Issuer or the Holder of any Warrant.
"Issuer" means StatSure Diagnostic Systems, Inc., a Delaware
corporation, and its successors.
"Majority Holders" means at any time the Holders of Warrants
exercisable for a majority of the shares of Warrant Stock issuable under
the Warrants at the time outstanding.
"Original Issue Date" means May 31, 2006.
"OTC Bulletin Board" means the over-the-counter electronic bulletin
board.
"Other Common" means any other Capital Stock of the Issuer of any
class which shall be authorized at any time after the date of this Warrant
(other than Common Stock) and which shall have the right to participate in
the distribution of earnings and assets of the Issuer without limitation
as to amount.
"Outstanding Common Stock" means, at any given time, the aggregate
amount of outstanding shares of Common Stock, assuming full exercise,
conversion or exchange (as applicable) of all options, warrants and other
Securities which are convertible into or exercisable or exchangeable for,
and any right to subscribe for, shares of Common Stock that are
outstanding at such time.
"Person" means an individual, corporation, limited liability
company, partnership, joint stock company, trust, unincorporated
organization, joint venture, Governmental Authority or other entity of
whatever nature.
"Per Share Market Value" means on any particular date (a) the last
closing bid price per share of the Common Stock on such date on the OTC
Bulletin Board or another registered national stock exchange on which the
Common Stock is then listed, or if there is no such price on such date,
then the closing bid price on such exchange or quotation system on the
date nearest preceding such date, or (b) if the Common Stock is not listed
then on the OTC Bulletin Board or any registered national stock exchange,
the last closing bid price for a share of Common Stock in the
over-the-counter market, as reported by the OTC Bulletin Board or in the
National Quotation Bureau Incorporated or similar organization or agency
succeeding to its functions of reporting prices) at the close of business
on such date, or (c) if the Common Stock is not then reported by the OTC
Bulletin Board or the National Quotation Bureau Incorporated (or similar
organization or agency succeeding to its functions of reporting prices),
then the average of the "Pink Sheet" quotes for the five (5) Trading Days
preceding such date of determination, or (d) if the Common Stock is not
then publicly traded the fair market value of a share of Common Stock as
determined by an Independent Appraiser selected in good faith by the
Majority Holders; provided, however, that the Issuer, after receipt of the
determination by such Independent Appraiser, shall have the right to
select an additional Independent Appraiser, in which case, the fair market
value shall be equal to the average of the determinations by each such
Independent Appraiser; and provided, further that all determinations of
the Per Share Market Value shall be appropriately adjusted for any stock
dividends, stock splits or other similar transactions during such period.
The determination of fair market value by an Independent Appraiser shall
be based upon the fair market value of the Issuer determined on a going
concern basis as between a willing buyer and a willing seller and taking
into account all relevant factors determinative of value, and shall be
final and binding on all parties. In determining the fair market value of
any shares of Common Stock, no consideration shall be given to any
restrictions on transfer of the Common Stock imposed by agreement or by
federal or state securities laws, or to the existence or absence of, or
any limitations on, voting rights.
"Purchase Agreement" means the Series A Preferred Stock Purchase
Agreement dated as of May 31, 2006, among the Issuer and the Purchasers.
"Purchasers" means the purchasers of the Preferred Stock and the
Warrants issued by the Issuer pursuant to the Purchase Agreement.
"Securities" means any debt or equity securities of the Issuer,
whether now or hereafter authorized, any instrument convertible into or
exchangeable for Securities or a Security, and any option, warrant or
other right to purchase or acquire any Security. "Security" means one of
the Securities.
"Securities Act" means the Securities Act of 1933, as amended, or
any similar federal statute then in effect.
"Subsidiary" means any corporation at least 50% of whose outstanding
Voting Stock shall at the time be owned directly or indirectly by the
Issuer or by one or more of its Subsidiaries, or by the Issuer and one or
more of its Subsidiaries.
"Term" has the meaning specified in Section 1 hereof.
"Trading Day" means (a) a day on which the Common Stock is traded on
the OTC Bulletin Board, or (b) if the Common Stock is not traded on the
OTC Bulletin Board, a day on which the Common Stock is quoted in the
over-the-counter market as reported by the National Quotation Bureau
Incorporated (or any similar organization or agency succeeding its
functions of reporting prices); provided, however, that in the event that
the Common Stock is not listed or quoted as set forth in (a) or (b)
hereof, then Trading Day shall mean any day except Saturday, Sunday and
any day which shall be a legal holiday or a day on which banking
institutions in the State of New York are authorized or required by law or
other government action to close.
"Voting Stock" means, as applied to the Capital Stock of any
corporation, Capital Stock of any class or classes (however designated)
having ordinary voting power for the election of a majority of the members
of the Board of Directors (or other governing body) of such corporation,
other than Capital Stock having such power only by reason of the happening
of a contingency.
"Warrants" means the Warrants issued and sold pursuant to the
Purchase Agreement, including, without limitation, this Warrant, and any
other warrants of like tenor issued in substitution or exchange for any
thereof pursuant to the provisions of Section 2(c), 2(d) or 2(e) hereof or
of any of such other Warrants.
"Warrant Price" initially means $1.50, as such price may be adjusted
from time to time as shall result from the adjustments specified in this
Warrant, including Section 4 hereto.
"Warrant Share Number" means at any time the aggregate number of
shares of Warrant Stock which may at such time be purchased upon exercise
of this Warrant, after giving effect to all prior adjustments and
increases to such number made or required to be made under the terms
hereof.
"Warrant Stock" means Common Stock issuable upon exercise of any
Warrant or Warrants or otherwise issuable pursuant to any Warrant or
Warrants.
10. Other Notices. In case at any time:
(A) the Issuer shall make any distributions to the
holders of Common Stock; or
(B) the Issuer shall authorize the granting to all
holders of its Common Stock of rights to subscribe
for or purchase any shares of Capital Stock of any
class or other rights; or
(C) there shall be any reclassification of the Capital
Stock of the Issuer; or
(D) there shall be any capital reorganization by the
Issuer; or
(E) there shall be any (i) consolidation or merger
involving the Issuer or (ii) sale, transfer or
other disposition of all or substantially all of
the Issuer's property, assets or business (except
a merger or other reorganization in which the
Issuer shall be the surviving corporation and its
shares of Capital Stock shall continue to be
outstanding and unchanged and except a
consolidation, merger, sale, transfer or other
disposition involving a wholly-owned Subsidiary);
or
(F) there shall be a voluntary or involuntary
dissolution, liquidation or winding-up of the
Issuer or any partial liquidation of the Issuer or
distribution to holders of Common Stock;
then, in each of such cases, the Issuer shall give written notice to the Holder
of the date on which (i) the books of the Issuer shall close or a record shall
be taken for such dividend, distribution or subscription rights or (ii) such
reorganization, reclassification, consolidation, merger, disposition,
dissolution, liquidation or winding-up, as the case may be, shall take place.
Such notice also shall specify the date as of which the holders of Common Stock
of record shall participate in such dividend, distribution or subscription
rights, or shall be entitled to exchange their certificates for Common Stock for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, disposition, dissolution, liquidation
or winding-up, as the case may be. Such notice shall be given at least twenty
(20) days prior to the action in question and not less than ten (10) days prior
to the record date or the date on which the Issuer's transfer books are closed
in respect thereto. This Warrant entitles the Holder to receive copies of all
financial and other information distributed or required to be distributed to the
holders of the Common Stock.
11. Amendment and Waiver. Any term, covenant, agreement or condition in
this Warrant may be amended, or compliance therewith may be waived (either
generally or in a particular instance and either retroactively or
prospectively), by a written instrument or written instruments executed by the
Issuer and the Majority Holders; provided, however, that no such amendment or
waiver shall reduce the Warrant Share Number, increase the Warrant Price,
shorten the period during which this Warrant may be exercised or modify any
provision of this Section 11 without the consent of the Holder of this Warrant.
No consideration shall be offered or paid to any person to amend or consent to a
waiver or modification of any provision of this Warrant unless the same
consideration is also offered to all holders of the Warrants.
12. Governing Law; Jurisdiction. This Warrant shall be governed by and
construed in accordance with the internal laws of the State of New York, without
giving effect to any of the conflicts of law principles which would result in
the application of the substantive law of another jurisdiction. This Warrant
shall not be interpreted or construed with any presumption against the party
causing this Warrant to be drafted. The Issuer and the Holder agree that venue
for any dispute arising under this Warrant will lie exclusively in the state or
federal courts located in Middlesex County, Massachusetts and the parties
irrevocably waive any right to raise forum non conveniens or any other argument
that Massachusetts is not the proper venue. The Issuer and the Holder
irrevocably consent to personal jurisdiction in the state and federal courts of
the state of Massachusetts. The Issuer and the Holder consent to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address in effect for notices to it under this Warrant and agrees
that such service shall constitute good and sufficient service of process and
notice thereof. Nothing in this Section 12 shall affect or limit any right to
serve process in any other manner permitted by law. The Issuer and the Holder
hereby agree that the prevailing party in any suit, action or proceeding arising
out of or relating to this Warrant or the Purchase Agreement, shall be entitled
to reimbursement for reasonable legal fees from the non-prevailing party. The
parties hereby waive all rights to a trial by jury.
13. Notices. Any notice, demand, request, waiver or other communication
required or permitted to be given hereunder shall be in writing and shall be
effective (a) upon hand delivery by telecopy or facsimile at the address or
number designated below (if delivered on a business day during normal business
hours where such notice is to be received), or the first business day following
such delivery (if delivered other than on a business day during normal business
hours where such notice is to be received) or (b) on the second business day
following the date of mailing by express courier service, fully prepaid,
addressed to such address, or upon actual receipt of such mailing, whichever
shall first occur. The addresses for such communications shall be:
If to the Issuer: StatSure Diagnostic Systems, Inc.
0 Xxxxxx Xxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: President
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
with copies (which copies
shall not constitute notice)
to: XXXXXX X. XXXXXXX,ESQ.
Xxxxxxx & Prager LLP
00 Xxxxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
If to any Holder: At the address of such Holder
set forth on Exhibit A to this Agreement,
with copies to Holder's counsel as set forth
on Exhibit A or as specified in writing by
such Holder with copies to:
with copies (which copies
shall not constitute notice)
to: Chardan Capital Markets, LLC
00 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Tel. No.: (000) 000 000 0000
Fax: (212) 785 -1535
Any party hereto may from time to time change its address for notices by
giving written notice of such changed address to the other party hereto.
14. Warrant Agent. The Issuer may, by written notice to each Holder of
this Warrant, appoint an agent having an office in New York, New York for the
purpose of issuing shares of Warrant Stock on the exercise of this Warrant
pursuant to subsection (b) of Section 2 hereof, exchanging this Warrant pursuant
to subsection (d) of Section 2 hereof or replacing this Warrant pursuant to
subsection (d) of Section 3 hereof, or any of the foregoing, and thereafter any
such issuance, exchange or replacement, as the case may be, shall be made at
such office by such agent.
15. Remedies. The Issuer stipulates that the remedies at law of the Holder
of this Warrant in the event of any default or threatened default by the Issuer
in the performance of or compliance with any of the terms of this Warrant are
not and will not be adequate and that, to the fullest extent permitted by law,
such terms may be specifically enforced by a decree for the specific performance
of any agreement contained herein or by an injunction against a violation of any
of the terms hereof or otherwise.
16. Successors and Assigns. This Warrant and the rights evidenced hereby
shall inure to the benefit of and be binding upon the successors and assigns of
the Issuer, the Holder hereof and (to the extent provided herein) the Holders of
Warrant Stock issued pursuant hereto, and shall be enforceable by any such
Holder or Holder of Warrant Stock.
17. Modification and Severability. If, in any action before any court or
agency legally empowered to enforce any provision contained herein, any
provision hereof is found to be unenforceable, then such provision shall be
deemed modified to the extent necessary to make it enforceable by such court or
agency. If any such provision is not enforceable as set forth in the preceding
sentence, the unenforceability of such provision shall not affect the other
provisions of this Warrant, but this Warrant shall be construed as if such
unenforceable provision had never been contained herein.
18. Headings. The headings of the Sections of this Warrant are for
convenience of reference only and shall not, for any purpose, be deemed a part
of this Warrant.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the Issuer has executed this Series A Warrant as of
the day and year first above written.
STATSURE DIAGNOSTIC SYSTEMS, INC.
By:______________________________
Name:
Title:
EXERCISE FORM
SERIES A WARRANT
STATSURE DIAGNOSTIC SYSTEMS, INC.
The undersigned _______________, pursuant to the provisions of the within
Warrant, hereby elects to purchase _____ shares of Common Stock of StatSure
Diagnostic Systems, Inc. covered by the within Warrant.
Dated: _________________ Signature ___________________________
Address ___________________________
___________________________
The Holder is an "accredited investor" as defined in Regulation D under the
Securities Act of 1933, as amended.
Number of shares of Common Stock beneficially owned or deemed beneficially owned
by the Holder on the date of
Exercise: _________________________
ASSIGNMENT
FOR VALUE RECEIVED, _________________ hereby sells, assigns and transfers unto
__________________ the within Warrant and all rights evidenced thereby and does
irrevocably constitute and appoint _____________, attorney, to transfer the said
Warrant on the books of the within named corporation.
Dated: _________________ Signature ___________________________
Address ___________________________
___________________________
PARTIAL ASSIGNMENT
FOR VALUE RECEIVED, _________________ hereby sells, assigns and transfers unto
__________________ the right to purchase _________ shares of Warrant Stock
evidenced by the within Warrant together with all rights therein, and does
irrevocably constitute and appoint ___________________, attorney, to transfer
that part of the said Warrant on the books of the within named corporation.
Dated: _________________ Signature ___________________________
Address ___________________________
___________________________
FOR USE BY THE ISSUER ONLY:
This Warrant No. W-___ canceled (or transferred or exchanged) this _____ day of
___________, _____, shares of Common Stock issued therefor in the name of
_______________, Warrant No. W-_____ issued for ____ shares of Common Stock in
the name of _______________.
