Exhibit 99(d)(8)
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OR CONVERSION
HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR APPLICABLE
STATE SECURITIES LAWS AND HAVE BEEN TAKEN FOR INVESTMENT PURPOSES ONLY AND NOT
WITH A VIEW TO THE DISTRIBUTION THEREOF, AND SUCH SECURITIES MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS THERE IS
AN EFFECTIVE REGISTRATION STATEMENT COVERING SUCH SECURITIES OR X-XXXXXXX.XXX
(THE "COMPANY") RECEIVES AN OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE
COMPANY) STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND
PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT OR APPLICABLE STATE SECURITIES
LAWS.
x-XxxXxxx.xxx
Warrant to Purchase 6,000,000 Shares of Common Stock
Date of Grant: October 18, 2001
Void After October 18, 2006
x-XxxXxxx.xxx, a Nevada Corporation (the "COMPANY") hereby certifies that,
for value received, Xxxxxxx Xxxxxxxx (the "HOLDER") is the registered holder of
a warrant ("WARRANT") to subscribe for and purchase from the Company, at the
Warrant Price defined in Section 2 herein, six million (6,000,000) fully paid
and non-assessable shares of the Company's common stock. $0.001 par value per
share (the "COMMON STOCK"), such price and such number of shares being subject
to adjustment upon occurrence of the contingencies set forth in this Warrant
("WARRANT SHARES").
This Warrant is subject to the following terms and conditions:
1. TERM/VESTING OF WARRANT.
(a) Subject to Section 1(b) hereof, this Warrant may be exercised in whole
or in part at any time prior to the first to occur of the following: (i) 5:00
p.m., Pacific Standard Time, October 18, 2006; or (ii) the consummation of any
transaction or series of transactions (collectively, the "TRANSACTION"),
including without limitation, the sale, transfer or disposition of all or
substantially all of the Company's assets or the merger of the Company with or
into, or consolidation with, any other corporation, whereby the holders of the
Company's voting securities prior to the Transaction do not hold more than 50%
of the voting securities of the surviving entity following consummation of the
Transaction (a "CHANGE OF CONTROL").
Upon the occurrence of any of the events described in clause (i) above,
this Warrant, to the extent not exercised, shall terminate. Upon the occurrence
of any of the events described in clause (ii) above, this Warrant, to the extent
not otherwise exercisable or previously exercised, shall be deemed to have been
automatically become exercisable in full and converted pursuant to
Section 4 hereof and thereafter the Holder shall participate in the Transaction
on the same terms as other holders of Common Stock.
(b) This Warrant shall not be exercisable until 90 days after the close of
the Minimum Condition (as that term is defined in the Agreement and Plan of
Merger and Reorganization ("Merger Agreement") by and among the Company, TLC
Acquisition Corporation, and Tender Loving Care Health Care Services, Inc.
("TLCS"); provided, however, if the Executive shall voluntarily terminate
employment with TLCS (other than for Good Reason) or if the Executive is
terminated for Cause (as such terms are defined in the Employment Agreement
dated October 18, 2001 by and between Holder and TLCS ("EMPLOYMENT AGREEMENT"))
during the first twelve (12) months of the Employment Agreement, the Executive
shall immediately return to the Company a number of shares equal to the Warrant
Shares multiplied by a fraction, the numerator of which shall be twelve (12)
less the total number of full months that have elapsed from the Effective Date
(as such term is defined in the Employment Agreement) and the date of
termination and the denominator of which shall be twelve (12).
2. WARRANT PRICE.
The exercise price of this Warrant (the "WARRANT PRICE") shall equal $0.50
per share.
3. METHOD OF EXERCISE; PAYMENT; ISSUANCE OF NEW WARRANT. Subject to Section
1 hereof, the purchase right represented by this Warrant may be exercised by the
holder hereof, in whole or in part and from time to time, by the surrender of
this Warrant (with the notice of exercise form attached hereto as Exhibit A duly
executed) at the principal office of the Company and by the payment to the
Company of an amount equal to the Warrant Price multiplied by the number of
Warrant Shares then being purchased. The person or persons in whose name(s) any
certificate(s) representing shares of Common Stock are issuable upon exercise of
this Warrant shall be deemed to have become the holder(s) of record of, and
shall be treated for all purposes as the record holder(s) of, the shares
represented thereby (and such shares shall be deemed to have been issued)
immediately prior to the close of business on the date or dates upon which this
Warrant is exercised. In the event of any exercise of the rights represented by
this Warrant, certificates for the shares of Common Stock so purchased shall be
delivered to the holder hereof as soon as possible and in any event within 15
days after such exercise and, unless this Warrant has been fully exercised, the
portion of the Warrant Shares, if any, with respect to which this Warrant shall
not then have been exercised shall also be issued to the holder hereof as soon
as possible and in any event within such 15-day period.
4. RIGHT TO CONVERT WARRANT INTO COMMON STOCK; NET ISSUANCE.
(a) RIGHT TO CONVERT. In addition to and without limiting the rights of a
holder of this Warrant under the terms hereof, a holder shall have the right to
convert this Warrant or any portion thereof (the "CONVERSION RIGHT") into shares
of Common Stock as provided in this Section 4 at any time or from time to time
during the period during which this Warrant is exercisable pursuant to the terms
hereof. Upon exercise of the Conversion Right with respect to all or a specified
portion of shares subject to this Warrant (the "CONVERTED WARRANT SHARES"), the
Company shall deliver to the holder (without payment by the holder of any
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exercise price or any cash or other consideration) that number of shares of
fully paid and nonassessable Common Stock equal to the quotient obtained by
dividing (x) the value of this Warrant (or the specified portion hereof) on the
Conversion Date (as defined in Section 4(b) below), which value shall be equal
to (A) the aggregate fair market value of the Converted Warrant Shares issuable
upon exercise of this Warrant (or the specified portion hereof) on the
Conversion Date less (B) the aggregate of the Warrant Price applicable to the
Converted Warrant Shares immediately prior to the exercise of the Conversion
Right by (y) the fair market value of one share of Common Stock on the
Conversion Date. Expressed as a formula, such conversion shall be computed as
follows:
X= A-B
---
Y
Where: X= the number of shares of Common Stock that may be
issued to the holder
Y= the fair market value (FMV) of one share of Common
Stock
A= the aggregate FMV (I.E., FMV x Converted Warrant
Shares)
B= the aggregate Warrant Price (I.E., Converted Warrant
Shares x Warrant Price)
No fractional shares shall be issuable upon exercise of the Conversion
Right, and, if the number of shares to be issued determined in accordance with
the foregoing formula is other than a whole number, the Company shall pay to the
holder an amount in cash equal to the fair market value of the resulting
fractional share on the Conversion Date. For purposes of Section 4(a), shares
issued pursuant to the Conversion Right shall be treated as if they were issued
upon the exercise of this Warrant.
(b) METHOD OF EXERCISE. The Conversion Right may be exercised by the holder
by the surrender of this Warrant at the principal office of the Company together
with a written statement specifying that the holder thereby intends to exercise
the Conversion Right and indicating the number of shares subject to this Warrant
which are being surrendered (referred to in Section 4(a) hereof as the Converted
Warrant Shares), and the Warrant Price applicable thereto, in exercise of the
Conversion Right. Such conversion shall be effective upon receipt by the Company
of this Warrant together with the aforesaid written statement, or on such later
date as is specified therein (the "CONVERSION DATE"). Certificates for the
shares issuable upon exercise of the Conversion Right and, if applicable, a new
warrant evidencing the balance of the shares remaining subject to this Warrant,
shall be issued as of the Conversion Date and shall be delivered to the holder
within 15 days following the Conversion Date
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(c) DETERMINATION OF FAIR VALUE. For purposes of this Section 4, fair
market value of a Share and of a Converted Warrant Share as of a particular date
shall be determined as follows:
(a) if such Share is then quoted on The American Stock Exchange, any
other national securities exchange, Nasdaq, or the OTC Bulletin Board, the
simple average of the closing sales prices as reported on such exchange or
market for the ten (10) consecutive trading days prior to such date;
(b) if such share is publicly traded but is not quoted on The American
Stock Exchange, any other national securities exchange, Nasdaq nor the OTC
Bulletin Board, the value shall be the fair market value thereof, as
determined in good faith by the Board of Directors of the Company.
5. STOCK FULLY PAID; RESERVATION OF SHARES. All Warrant Shares that may be
issued upon the exercise of the rights represented by this Warrant shall, upon
issuance pursuant to the terms and conditions herein, be fully paid and
nonassessable, and free from all taxes, liens, charges and pre-emptive rights
with respect to the issue thereof. The Company shall pay all transfer taxes, if
any, attributable to the issuance of the Warrant Shares upon the exercise of
this Warrant. Notwithstanding anything to the contrary herein, prior to the
issuance of any Warrant Shares to the Holder, the Company shall be entitled to
withhold any applicable taxes, including adjusting the number of Warrant Shares
issued to reflect such withholding. During the period within which the rights
represented by this Warrant may be exercised, the Company shall at all times
have authorized, and reserved for the purpose of issuance upon exercise of the
purchase rights evidenced by this Warrant a sufficient number of shares of its
Common Stock to provide for the exercise of the rights represented by this
Warrant.
6. ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF SHARES; LIMITATION ON
EXERCISE. The number and kind of securities purchasable upon the exercise of
this Warrant and the Warrant Price shall be subject to adjustment from time to
time in accordance with this Section 6; provided that, no such adjustment shall
be made if a corresponding adjustment is made pursuant to the Company's Articles
of Incorporation.
(a) RECLASSIFICATION, CONSOLIDATION OR MERGER. In case of any
reclassification or change of outstanding securities of the class issuable upon
exercise of this Warrant (other than as a result of a subdivision or
combination), or in case of any consolidation or merger of the Company with or
into another corporation (other than a Change of Control as provided in Section
1(b) hereof), the Company, or such successor corporation, as the case may be,
shall execute a new Warrant, providing that the holder of this Warrant shall
have the right to exercise such new Warrant and procure upon such exercise in
lieu of each share of Common Stock theretofore issuable upon exercise of this
Warrant the kind and amount of shares of stock, other securities, money and
property receivable upon such reclassification, change, consolidation or merger
by a holder of one share of Common Stock. Such new Warrant shall provide for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 6. The provisions of this subsection
(a) shall similarly apply to successive reclassifications, changes,
consolidations and mergers.
(b) SUBDIVISION OR COMBINATION OF SHARES. If at any time on or after the
date of this Warrant the Company shall subdivide its outstanding shares of
Common Stock into a greater number of shares, the Warrant
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Price in effect immediately prior to such subdivision shall subdivide its
outstanding shares of Common Stock into a greater number of shares, the Warrant
Price in effect immediately prior to such subdivision shall be proportionately
reduced and the number of shares receivable upon exercise of the Warrant shall
be proportionately increased; and, conversely, if at any time on or after the
date of this Warrant the outstanding number of shares of Common Stock shall be
combined into a smaller number of shares, the Warrant Price in effect
immediately prior to such combination shall be proportionately increased and the
number of shares receivable upon exercise of the Warrant shall be
proportionately decreased.
(c) ADJUSTMENT OF NUMBER OF SHARES. Upon each adjustment in the Warrant
Price, the number of Shares of Common Stock purchasable hereunder shall be
adjusted, to the nearest whole share, to the product obtained by multiplying the
number of Shares purchasable immediately prior to such adjustment in the Warrant
Price by a fraction, the numerator of which shall be the Warrant Price
immediately prior to such adjustment and the denominator of which shall be the
Warrant Price immediately thereafter.
7. FRACTIONAL SHARES. No fractional shares of Common Stock will be issued
in connection with any exercise hereunder, but in lieu of such fractional shares
the Company shall make a cash payment therefor based on the fair market value
(as determined in accordance with Section 4(c) hereof) of a share of Common
Stock on the date of exercise.
8. NOTICES.
(a) Upon any adjustment of the Warrant Price and any increase or decrease
in the number of shares of Common Stock purchasable upon the exercise of this
Warrant, then, and in each such case, the Company, within thirty (30) days
thereafter, shall give written notice thereof to the registered holder of this
Warrant (the "NOTICE"). The Notice shall be mailed to the address of such as
shown on the books of the Company, and shall state the Warrant Price as adjusted
and the increased or decreased number of shares purchasable upon the exercise of
this Warrant, setting forth in reasonable detail the method of calculation of
each.
(b) In the event that the Company shall propose at any time to effect a
Change of Control, the Company shall send to the Holder at least 15 days' prior
written notice of the date when the same shall take place.
(c) Each such written notice shall be given by first class mail, postage
prepaid, addressed to the Holder at the address as shown on the books of the
Company for the Holder.
9. RESTRICTIONS ON TRANSFER. Certificates representing any of the Common
Stock acquired pursuant to the provisions of this Warrant shall have endorsed
thereon legends substantially in the following form, as appropriate.
(a) Unless such shares of Common Stock are received in a transaction
registered under the Securities Act and qualified (if necessary) under
applicable state securities laws:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION UNLESS THE
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COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO IT
STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND
PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT."
(b) Any legend required to be placed thereon by any applicable state
securities laws.
10. VOLUME LIMITATIONS ON RESALE. In addition to any restrictions and
limitations imposed by applicable law on the resale of Warrant Shares, Xxxxxx
agrees that for a period of five (5) years following the earliest to occur of
either of the events described in Section 1(a) to refrain from selling any
Warrant Shares in excess of 50,000 shares per trading day, and in the event the
closing sales price of the Common Stock for any trading day is below $2.00 per
share, the Holder shall not sell more than 25,000 shares for the next immediate
trading day. Notwithstanding anything to the contrary herein, any sales shall be
subject to Rule 144 of the Securities Act of 1933, as amended, if applicable.
11. COMPLIANCE WITH ACT. The Holder, by acceptance hereof, agrees that this
Warrant and the Common Stock to be issued upon the exercise or conversion hereof
are being acquired solely for its own account and not as a nominee for any other
party and not with a view toward the resale or distribution thereof and that it
will not offer, sell or otherwise dispose of this Warrant or any of the Common
Stock to be issued upon the exercise or conversion hereof except in accordance
herewith and under circumstances which will not result in a violation of the
Securities Act or of applicable state securities laws.
12. REGISTRATION RIGHTS. Within 90 days after the close of the Minimum Condition
(as that term is defined in the Merger Agreement), the Company shall file a
registration statement under applicable securities laws regarding the shares of
Common Stock underlying the Warrant, to the extent required to permit the
disposition of such shares by Holder pursuant to such registration statement.
The Company shall use its best efforts to respond to any comments received by it
from applicable securities regulations. The Company shall cause such
registration statement to remain effective until the second anniversary of the
date on which all shares of Common Stock underlying the Warrant have been
exercised. The Company shall pay all reasonable expenses of Holder incurred in
connection with the registration of such shares, other than underwriting
discounts and commissions, if any, and applicable transfer or withholding taxes,
if any.
13. MISCELLANEOUS.
(a) The terms of this Warrant shall be binding upon and shall inure to the
benefit of any successors or assigns of the Company and of the holder or holders
hereof and of the Common Stock issued or issuable upon the exercise hereof
(including without limitation the estate, heirs or designated beneficiaries of
Holder).
(b) No holder of this Warrant, as such, shall be entitled to vote or
receive dividends or be deems to be a stockholder of the Company for any
purpose, nor shall anything contained in this Warrant be construed to confer
upon the holder of this Warrant, as such, any rights of a
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stockholder of the Company or any right to vote, give or withhold consent to any
corporate action, receive notice of meetings, receive dividends or subscription
rights, or otherwise.
(c) Receipt of this Warrant by the holder hereof shall constitute
acceptance of and agreement to the foregoing terms and conditions.
(d) The Company will not, by amendment of its Restated Certificate of
Incorporation or through any other means, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the holder of this Warrant against impairment.
(e) Upon receipt of evidence reasonably satisfactory to the Company of the
loss, theft, destruction or mutilation of this Warrant and, in the case of any
such loss, theft or distribution, upon delivery of an indemnity agreement
reasonably satisfactory in form and amount to the Company or, in the case of any
such mutilation, upon surrender and cancellation of such Warrant, the Company at
its expense will execute and deliver, in lieu thereof, a new Warrant of like
date and tenor.
(f) This Warrant shall be nontransferable, other than pursuant to (i) a
transfer not involving a change in beneficial ownership, and (ii) any transfer
by any Holder to (A) members of Xxxxxx's immediate family or their respective
ancestors or descendants or a trust, custodianship, partnership or fiduciary
account for the benefit of any such person or (B) any foundation organized for
charitable or not-for-profit purposes, in each case for clauses (A) and (B)
whether or not Holder maintains the power to direct any investment decisions.
Any transfer pursuant to this Section 13(f) shall be subject to the terms and
conditions of this Warrant and any applicable securities laws.
(g) This Warrant or any provision of this Warrant may be amended, waived,
discharged or terminated by a statement in writing signed by the party against
which enforcement of the amendment, waiver, discharge or termination is sought.
(h) This Warrant shall be governed by the laws of the State of Nevada
X-XXXXXXX.XXX
By: /S/ XXXXX XXXXXXXXXXXX
-----------------------------------------
Name: Xxxxx Xxxxxxxxxxxx
Title: President and Co-CEO
Dated: October 18, 2001
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NOTICE OF EXERCISE
To: x-XxxXxxx.xxx
1. The undersigned hereby irrevocably elects to purchase ______ shares of
Common Stock of x-XxxXxxx.xxx pursuant to the terms of the attached Warrant and
tenders herewith payment of the purchase price of such shares in full.
2. Please issue a certificate or certificates representing said shares in
the name of the undersigned (or in such other name or names as are specified
below):
Name:________________________________________________________________________
(Please print)
Address:______________________________________________________________________
3. The undersigned represents that the aforesaid shares are being acquired
for the account of the undersigned for investment and not with a view to, or for
resale in connection with the distribution thereof and that the undersigned has
no present intention of distributing or reselling such shares.
Signature:__________________________________
Date: __________________________________
ASSIGNMENT FORM
FOR VALUE RECEIVED, ___________________ hereby sells, assigns and transfers unto
Name:________________________________________________________________________
(Please print)
Address:______________________________________________________________________
the right to purchase Common Stock represented by this Warrant to the extent
of __________ shares as to which such right is exercisable and does hereby
irrevocably constitute and appoint ______________________ Attorney, to transfer
the same on the books of x-Xxxxxxx.xxx corporation with full power of
substitution in the premises.
Dated:__________________________
Signature:_____________________________________________________________________
Witness:______________________________________________________________________
(Signature must conform to the name of the holder of the Warrant.)
