UNDERWRITER'S WARRANT AGREEMENT
--------------------------------------------------------------------------------
OMNICORDER TECHNOLOGIES, INC.
AND
CAMBRIDGE CAPITAL, LLC
UNDERWRITER'S
WARRANT AGREEMENT
Dated as of ____________, 1999
--------------------------------------------------------------------------------
UNDERWRITER'S WARRANT AGREEMENT dated as of ___________, 1999
among OMNICORDER TECHNOLOGIES, INC., a Delaware corporation (the "Company"), and
CAMBRIDGE CAPITAL, LLC (hereinafter referred to as "Holder" or "Underwriter").
W I T N E S S E T H :
WHEREAS, the Company proposes to issue to Underwriter or its
designees warrants ("Warrants") to purchase up to an aggregate of [_________]
shares of common stock, par value $.01 per share, of the Company ("Common
Stock"); and
WHEREAS, Underwriter has agreed pursuant to the underwriting
agreement (the "Underwriting Agreement") dated as of the date hereof among
Underwriter and the Company to act as Underwriter in connection with the
Company's proposed public offering of up to [____________] shares of Common
Stock at a public price of [$______] per share of Common Stock (the "Public
Offering"); and
WHEREAS, the Warrants to be issued pursuant to this Agreement
will be issued on the Closing Date (as such term is defined in the Underwriting
Agreement) by the Company to Underwriter in consideration for, and as part of
Underwriter's compensation in connection with the Public Offering;
NOW, THEREFORE, in consideration of the premises, the payment
by Underwriter to the Company of an aggregate of [$___________], the agreements
herein set forth and other good and valuable consideration, hereby acknowledged,
the parties hereto agree as follows:
1. Grant. Cambridge Capital, LLC is hereby granted the right
to purchase, at any time from ___________, 2000, until 5:30 P.M., New York time,
on ___________, 2004, up to an aggregate of ___________ shares of Common Stock
(the "Underwriter's Shares") at an initial exercise price (subject to adjustment
as provided in Section 8 hereof) equal to 120% of the initial public offering
price of the shares of Common Stock or [$______] per share of Common Stock
subject to the terms and conditions of this Agreement.
2. Warrant Certificates. The warrant certificates (the
"Warrant Certificates") delivered and to be delivered pursuant to this Agreement
shall be in the form set forth in Exhibit A, attached hereto and made a part
hereof, with such appropriate insertions, omissions, substitutions, and other
variations as required or permitted by this Agreement. Except as set forth
herein, the Underwriter's Shares issuable upon exercise of the Warrants are in
all respects identical to the shares of Common Stock being purchased by
Underwriter for resale to the public pursuant to the terms and provisions of the
Underwriting Agreement.
3. Exercise of Warrant.
ss. 3.1 Method of Exercise. The Warrants initially are
exercisable at an aggregate initial exercise price (subject to adjustment as
provided in Section 8 hereof) per share of Common Stock set forth in Section 1
hereof payable by certified or official bank check in New York Clearing House
funds. Upon surrender of a Warrant Certificate with a duly executed copy of the
annexed Form of Election to Purchase, together with payment of the Exercise
Price (as hereinafter defined) for the shares of Common Stock purchased at the
Company's principal offices in Stony Brook, New York (presently
-2-
located at 00 X. Xxxx Xxxx) the registered holder of a Warrant Certificate
("Holder" or "Holders") shall be entitled to receive a certificate or
certificates for the shares of Common Stock so purchased. The purchase rights
represented by each Warrant Certificate are exercisable at the option of the
Holder thereof, in whole or in part (but not as to fractional shares of the
Common Stock underlying the Warrants). Warrants may be exercised to purchase all
or part of the shares of Common Stock represented thereby. In the case of the
purchase of less than all the shares of Common Stock purchasable under any
Warrant Certificate, the Company shall cancel such Warrant Certificate upon the
surrender thereof and shall execute and deliver a new Warrant Certificate of
like tenor for the balance of the shares of Common Stock purchasable thereunder.
ss. 3.2 Exercise by Surrender of Warrant. In addition to the
method of payment set forth in Section 3.1 and in lieu of any cash payment
required thereunder, a Holder of Warrants shall have the right at any time and
from time to time to exercise the Warrants in full or in part by surrendering
the Warrant Certificate in the manner specified in Section 3.1 in exchange for
the number of Shares equal to the product of (x) the number of Shares as to
which the Warrants are being exercised multiplied by (y) a fraction, the
numerator of which is the Market Price (as defined in Section 3.3 below) of the
Shares less the Exercise Price and the denominator of which is such Market
Price. Solely for the purposes of this paragraph, Market Price shall be
calculated either (i) on the date which the form of election attached hereto is
deemed to have been sent to the Company pursuant to Section 12 hereof ("Notice
Date") or (ii) as the average of the
-3-
Market Prices for each of the five trading days preceding the Notice Date,
whichever of (i) or (ii) is greater.
ss. 3.3 Definition of Market Price. As used herein, the phrase
"Market Price" at any date shall be deemed to be the last reported sale price,
or, in case no such reported sale takes place on such day, the average of the
last reported sale prices for the last three (3) trading days, in either case as
officially reported by the principal securities exchange on which the Common
Stock is listed or admitted to trading or by the Nasdaq Small Cap Market
("NSCM"), or, if the Common Stock is not listed or admitted to trading on any
national securities exchange or quoted by NSCM, the average closing bid price as
furnished by the National Association of Securities Dealers, Inc. ("NASD")
through NSCM, or any similar organization if NSCM is no longer reporting such
information, or if the Common Stock is not quoted on NSCM, as determined in good
faith by resolution of the Board of Directors of the Company, based on the best
information available to it.
4. Issuance of Certificates. Upon the exercise of the
Warrants, the issuance of certificates for shares of Common Stock and/or other
securities, properties or rights underlying such Warrants, shall be made
forthwith (and in any event within three (3) business days thereafter) without
charge to the Holder thereof including, without limitation, any tax which may be
payable in respect of the issuance thereof, and such certificates shall (subject
to the provisions of Sections 5 and 7 hereof) be issued in the name of, or in
such names as may be directed by, the Holder thereof; provided, however, that
the Company shall not be required to pay any tax which may be payable in respect
of any transfer involved in the issuance and delivery of any such certificates
-4-
in a name other than that of the Holder, and the Company shall not be required
to issue or deliver such certificates unless or until the person or persons
requesting the issuance thereof shall have paid to the Company the amount of
such tax or shall have established to the satisfaction of the Company that such
tax has been paid.
The Warrant Certificates and the certificates representing the
Shares underlying the Warrants (and/or other securities, property or rights
issuable upon the exercise of the Warrants) shall be executed on behalf of the
Company by the manual or facsimile signature of the then Chairman or Vice
Chairman of the Board of Directors or President or Vice President of the
Company. Warrant Certificates shall be dated the date of execution by the
Company upon initial issuance, division, exchange, substitution or transfer.
5. Restriction On Transfer of Warrants. The Holder of a
Warrant Certificate, by its acceptance thereof, covenants and agrees that the
Warrants are being acquired as an investment and not with a view to the
distribution thereof; that the Warrants may not be sold, transferred, assigned,
hypothecated or otherwise disposed of, in whole or in part, except to officers
or partners of the Underwriter.
6. Exercise Price.
ss. 6.1 Initial and Adjusted Exercise Price. Except as
otherwise provided in Section 8 hereof, the initial exercise price of each
Warrant shall be as set forth in Section 1 hereof. The adjusted exercise price
shall be the price which shall result from time to time from any and all
adjustments of the initial exercise price in accordance with the provisions of
Section 8 hereof.
-5-
ss. 6.2 Exercise Price. The term "Exercise Price" herein shall
mean the initial exercise price or the adjusted exercise price, depending upon
the context.
7. Registration Rights.
ss. 7.1 Registration Under the Securities Act of 1933.
The Shares, and any of the other securities issuable upon
exercise of the Warrants have been registered under the Securities Act of 1933,
as amended (the "Act"), pursuant to the Company's Registration Statement on Form
SB-2 (Registration No. ____________) (the "Registration Statement"). All of the
representations and warranties of the Company contained in the Underwriting
Agreement relating to the Registration Statement, the Preliminary Prospectus and
Prospectus (as such terms are defined in the Underwriting Agreement) and made as
of the dates provided therein, are hereby incorporated by reference.
-6-
Unless a registration statement relating to the shares underlying the
warrants ("the Warrants Securities") is in effect at the time of exercise
thereof, any certificates representing Warrant Securities issued shall bear the
following legend:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended
("Act"), and may not be offered or sold except pursuant to (i)
an effective registration statement under the Act, (ii) to the
extent applicable, Rule 144 under the Act (or any similar rule
under such Act relating to the disposition of securities), or
(iii) an opinion of counsel, if such opinion shall be
reasonably satisfactory to counsel to the issuer, that an
exemption from registration under such Act is available. (b)
ss. 7.2 Piggyback Registration. If, at any time commencing
after the date hereof and expiring seven (7) years from the date hereof, the
Company proposes to register any of its securities under the Act (other than in
connection with a merger or pursuant to Form S-8) it will give written notice by
registered mail, at least thirty (30) days prior to the filing of each such
registration statement, to the Holder and to all other Holder(s) of the Warrants
and/or the Warrant Securities, if not previously sold pursuant
-7-
to this Section 7, of its intention to do so. If the Underwriters or other
Holder(s) of the Warrants and/or Warrant Securities notify the Company within
twenty-five (25) days after receipt of any such notice of its or their desire to
include any such securities in such proposed registration statement, the Company
shall afford the Underwriter and such Holder(s) of the Warrants and/or Warrant
Securities the opportunity to have any such Warrant Securities registered under
such registration statement (sometimes referred to herein as the "Piggyback
Registration"). In the event that the underwriter managing the registration of
shares referred to in this paragraph 7.2 shall determine that some or all of the
Warrant Securities cannot be accomodated in such registration without adversely
affecting the offering of shares in such registration, the Company need not
include such Warrant Securities in such registration.
Notwithstanding the provisions of this Section 7.2, the
Company shall have the right at any time after it shall have given written
notice pursuant to this Section 7.2 (irrespective of whether a written request
for inclusion of any such securities shall have been made) to elect not to file
any such proposed registration statement, or to withdraw the same after the
filing but prior to the effective date thereof.
ss. 7.3 Demand Registration.
(a) At any time commencing after the date hereof and expiring 7 years
from the date hereof, the Holder of the Warrants and/or Warrant Securities
representing a "Majority" (as hereinafter defined) of such securities (assuming
the exercise of all of the Warrants), not previously sold pursuant to this
Section 7, shall have the right (which right is in addition to the registration
rights under Section 7.1 or 7.2 hereof), exercisable by written notice to the
Company, to have the Company prepare and file with the Commission, on one
occasion, a registration statement on Form S-3 or other suitable form and such
other documents, including a prospectus, as may be necessary in the opinion of
both counsel for the Company and counsel for the Underwriter and Holder, in
order to comply with the provisions of the Act, so as to permit a public
offering and sale of Warrant Securities
-8-
for the period necessary for such Holders to effect the proposed sale or other
disposition of the applicable Warrants and/or Warrant Securities.
(b) The Company covenants and agrees to (x) give written
notice of any registration request under this Section 7.3 by any Holder to all
other registered Holder of the Warrants and the Warrant Securities within ten
(10) days from the date of the receipt of any such registration request and (y)
include all the Warrant Securities, not previously sold pursuant to this Section
7, in such registration statement unless it receives notification from a Holder
within five (5) days following the Company's notification of registration that
such Holder does not want its Warrant Securities to be included in the
registration statement.
(c) Notwithstanding anything to the contrary contained
herein, if the Company shall not have filed a registration statement for the
Warrant Securities within
-9-
the time period specified in Section 7.4(a) hereof pursuant to the written
notice specified in Section 7.3(a) of a Majority of the Holders of the Warrants
and/or Warrant Securities, the Company shall, upon the written notice of
election of a Majority of the Holders of the Warrants and/or Warrant Securities,
offer to repurchase (i) any and all Warrant Securities at the higher of the
Market Price per share of Common Stock on (x) the date of the notice sent
pursuant to Section 7.3(a) or (y) the expiration of the period specified in
Section 7.4(a) and (ii) any and all Warrants at such Market Price less the
Exercise Price of such Warrant. Nothing herein shall be deemed to imply that the
obligation of the Company set forth in the previous sentence shall be triggered
if the registration statement is not declared effective by the SEC as long as
the Company has complied with paragraph 7.4(a). Such repurchase, if elected by
the Underwriter, shall be in immediately available funds and shall close within
two (2) days after the later of (i) the expiration of the period specified in
Section 7.4(a) or (ii) the delivery of the written notice of election specified
in this Section 7.3(d).]
ss. 7.4 Covenants of the Company With Respect to Registration.
In connection with any registration under Section 7.1 or 7.2 or 7.3 hereof, the
Company covenants and agrees as follows:
(a) The Company shall use its best efforts to file a
registration statement within ninety (90) days of receipt of any demand
therefor, shall use its best efforts to have any registration statements
declared effective at the earliest possible time, and shall furnish each Holder
desiring to sell Warrant Securities such number of prospectuses as shall
reasonably be requested; provided, however, that the Company shall not be
required to conduct an audit or prepare audited financial statements outside its
normal cycle and compliance with the request shall be delayed until such time as
the Company is otherwise required by law to complete its audit and prepare such
financial statements.
(b) The Company shall pay all costs (excluding fees and
expenses of Holder(s)' counsel and any underwriting or selling commissions),
fees and expenses in connection with all registration statements filed pursuant
to Sections 7.1(b), 7.2 and 7.3(a) hereof including, without limitation, the
Company's legal and accounting fees,
-10-
printing expenses and blue sky fees and expenses. If the Company shall fail to
comply with the provisions of Section 7.4(a), the Company shall, in addition to
any other equitable or other relief available to the Holder(s), be liable for
any or all incidental or special damages sustained by the Holder(s) requesting
registration of their Warrant Securities.
(c) The Company will take all necessary action which may be
required in qualifying or registering the Warrant Securities included in a
registration statement for offering and sale under the securities or blue sky
laws of such states as reasonably are requested by a majority in interest of the
Holder(s), provided that the Company shall not be obligated to execute or file
any general consent to service of process or to qualify as a foreign corporation
to do business under the laws of any such jurisdiction.
(d) The Company shall indemnify the Holder(s) of the Warrant
Securities to be sold pursuant to any registration statement and each person, if
any, who controls such Holder within the meaning of Section 15 of the Act or
Section 20(a) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), against all loss, claim, damage, expense or liability (including all
expenses reasonably incurred in investigating, preparing or defending against
any claim whatsoever) to which any of them may become subject under the Act, the
Exchange Act or otherwise, arising from such registration statement but only to
the same extent and with the same effect as the provisions pursuant to which the
Company has agreed to indemnify Underwriter contained in Section 7(a) of the
Underwriting Agreement, except that the representation set forth in the last
clause of Section (1)(s) thereunder shall not be required.
-11-
(e) The Holder(s) of the Warrant Securities to be sold
pursuant to a registration statement, and their successors and assigns, shall
severally, and not jointly, indemnify the Company, its officers and directors
and each person, if any, who controls the Company within the meaning of Section
15 of the Act or Section 20(a) of the Exchange Act, against all loss, claim,
damage or expense or liability (including all expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
they may become subject under the Act, the Exchange Act or otherwise, arising
from information furnished by or on behalf of such Holder, or their successors
or assigns, for specific inclusion in such registration statement to the same
extent and with the same effect as the provisions contained in Section 7(b) of
the Underwriting Agreement pursuant to which Underwriter has agreed to indemnify
the Company.
(f) Nothing contained in this Agreement shall be construed as
requiring the Holder(s) to exercise their Warrants prior to the filing of any
registration statement or the effectiveness thereof.
-12-
(g) The Company shall furnish to each Holder participating in
the offering and to each underwriter, if any, a signed counterpart, addressed to
such Holder or underwriter, of (i) an opinion of counsel to the Company, dated
the effective date of such registration statement (and, if such registration
includes an underwritten public offering, an opinion dated the date of the
closing under the underwriting agreement), and (ii) a "cold comfort" letter
dated the effective date of such registration statement (and, if such
registration includes an underwritten public offering, a letter dated the date
of the closing under the underwriting agreement) signed by the independent
public accountants who have issued a report on the Company's financial
statements included in such registration statement, in each case covering
substantially the same matters with respect to such registration statement (and
the prospectus included therein) and, in the case of such accountants' letter,
with respect to events subsequent to the date of such financial statements, as
are customarily covered in opinions of issuer's counsel and in accountants'
letters delivered to underwriters in underwritten public offerings of
securities.
(h) The Company shall as soon as practicable after the
effective date of the registration statement, and in any event within 15 months
thereafter, make "generally available to its security holders" (within the
meaning of Rule 158 under the Act) an earnings statement (which need not be
audited) complying with Section 11(a) of the Act and covering a period of at
least 12 consecutive months beginning after the effective date of the
registration statement.
(i) The Company shall deliver promptly to each Holder
participating in the offering requesting the correspondence and memoranda
described below and to the managing underwriters, copies of all correspondence
between the Commission and the
-13-
Company and between the Commission and the Company's counsel or auditors and all
reasonable memoranda relating to discussions with the Commission or its staff
with respect to the registration statement and permit each Holder and
underwriters to do such investigation, upon reasonable advance notice, with
respect to information contained in or omitted from the registration statement
as it deems reasonably necessary to comply with applicable securities laws or
rules of the NASD. Such investigation shall include access to books, records and
properties and opportunities to discuss the business of the Company with its
officers and independent auditors, all to such reasonable extent and at such
reasonable times and as often as any such Holder or underwriter shall reasonably
request.
(j) Unless the Company chooses to effect a required
registration hereunder on Form S-3, in the event of a demand for registration
under paragraph 7.3(a), the Company shall enter into an underwriting agreement
with the managing underwriter selected for such underwriting by Holders holding
a Majority of the Warrant Securities requested to be included in such
underwriting, which may be the Underwriter. Such agreement shall be satisfactory
in form and substance to the Company, each Holder and such managing underwriter,
and shall contain such representations, warranties and covenants by the Company
and such other terms as are customarily contained in agreements of that type
used by the managing underwriter. The Holder shall be parties to any
underwriting agreement relating to an underwritten sale of their Warrant
Securities and may, at their option, require that any or all the
representations, warranties and covenants of the Company to or for the benefit
of such underwriter shall also be made to and for the benefit of such Holder.
Such Holder shall not be required to make any representations or warranties to
or agreements with the
-14-
Company or the underwriter except as they may relate to such Holder and their
intended methods of distribution.
(k) For purposes of this Agreement, the term "Majority" in
reference to the Holders of Warrants or Warrant Securities, shall mean a
percentage in excess of fifty percent (50%) of the then outstanding Warrant
Securities (treating all such securities as fully exercised for Shares for
purposes of such calculation) that (i) are not held by the Company, an
affiliate, officer, creditor, employee or agent thereof or any of their
respective affiliates, members of their family, persons acting as nominees or in
conjunction therewith and (ii) have not been resold to the public pursuant to a
registration statement filed with the Commission under the Act.
8. Adjustments to Exercise Price and Number of Securities.
ss. 8.1 Subdivision and Combination. In case the Company shall
at any time subdivide or combine the outstanding shares of Common Stock, the
Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
ss. 8.2 Stock Dividends and Distributions. In case the Company
shall pay a dividend in, or make a distribution without payment of, shares of
Common Stock or of the Company's capital stock convertible into Common Stock, to
the holders of Common Stock, the Exercise Price shall forthwith be
proportionately decreased. An adjustment made pursuant to this Section 8.2 shall
be made as of the record date for the subject stock dividend or distribution.
ss. 8.3 Adjustment in Number of Securities. Upon each
adjustment of the Exercise Price pursuant to the provisions of this Section 8,
the number of Warrant Securities issuable upon the exercise at the adjusted
exercise price of each Warrant shall
-15-
be adjusted to the nearest whole number by multiplying a number equal to the
Exercise Price in effect immediately prior to such adjustment by the number of
Warrant Securities issuable upon exercise of the Warrants immediately prior to
such adjustment and dividing the product so obtained by the adjusted Exercise
Price.
ss. 8.4 Definition of Common Stock. For the purpose of this
Agreement, the term "Common Stock" shall mean (i) the class of stock designated
as Common Stock in the Certificate of Incorporation of the Company as may be
amended as of the date hereof, or (ii) any other class of stock resulting from
successive changes or reclassifications of such Common Stock consisting solely
of changes in par value, or from par value to no par value, or from no par value
to par value.
ss. 8.5 Merger or Consolidation. In case of any consolidation
of the Company with, or merger of the Company with, or merger of the Company
into, another corporation (other than a consolidation or merger which does not
result in any reclassification or change of the outstanding Common Stock), the
corporation formed by such consolidation or merger shall execute and deliver to
the Holder a supplemental warrant agreement providing that the holder of each
Warrant then outstanding or to be outstanding shall have the right thereafter
(until the expiration of such Warrant) to receive, upon exercise of such
warrant, the kind and amount of shares of stock and other securities and
property receivable upon such consolidation or merger, by a holder of the number
of shares of Common Stock of the Company for which such warrant might have been
exercised immediately prior to such consolidation, merger, sale or transfer.
-16-
Such supplemental warrant agreement shall provide for adjustments which shall be
identical to the adjustments provided in Section 8. The above provision of this
subsection shall similarly apply to successive consolidations or mergers.
ss. 8.6 No Adjustment of Exercise Price in Certain Cases. No
adjustment of the Exercise Price shall be made:
(a) Upon the issuance or sale of the Warrants to Underwriter
or the shares of Common Stock issued upon the exercise of the Warrants;
or
(b) If the amount of said adjustment shall be less than two
cents ($0.02) per Warrant Security, provided, however, that in such
case any adjustment that would otherwise be required then to be made
shall be carried forward and shall be made at the time of and together
with the next subsequent adjustment which, together with any adjustment
so carried forward, shall amount to at least two cents ($0.02) per
Warrant Security.
9. Exchange and Replacement of Warrant Certificates. Each
Warrant Certificate is exchangeable without expense, upon the surrender thereof
by the registered Holder at the principal executive office of the Company, for a
new Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of Warrant Securities in such denominations as
shall be designated by the Holder thereof at the time of such surrender.
Upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of any Warrant
Certificate, and, in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and reimbursement to the Company of all
reasonable expenses incidental thereto, and upon
-17-
surrender and cancellation of the Warrants, if mutilated, the Company will make
and deliver a new Warrant Certificate of like tenor, in lieu thereof.
10. Elimination of Fractional Interests. The Company shall not
be required to issue certificates representing fractions of shares of Common
Stock upon the exercise of the Warrants, nor shall it be required to issue scrip
or pay cash in lieu of fractional interests, it being the intent of the parties
that all fractional interests shall be eliminated by rounding any fraction up to
the nearest whole number of shares of Common Stock or other securities,
properties or rights.
11. Reservation and Listing of Securities. The Company shall
at all times reserve and keep available out of its authorized shares of Common
Stock, solely for the purpose of issuance upon the exercise of the Warrants,
such number of shares of Common Stock or other securities, properties or rights
as shall be issuable upon the exercise thereof. The Company covenants and agrees
that, upon exercise of the Warrants and payment of the Exercise Price therefor,
all shares of Common Stock and other securities issuable upon such exercise
shall be duly and validly issued, fully paid, non-assessable and not subject to
the preemptive rights of any stockholder. As long as the Warrants shall be
outstanding, the Company shall use its best efforts to cause all shares of
Common Stock issuable upon the exercise of the Warrants to be listed (subject to
official notice of issuance) on all securities exchanges on which the Common
Stock issued to the public in connection herewith may then be listed on a
National Securities Exchange and/or quoted on NSCM.
12. Notices to Warrant Holder. Nothing contained in this
Agreement shall be construed as conferring upon the Holder the right to vote or
to consent or to
-18-
receive notice as a stockholder in respect of any meetings of stockholder for
the election of directors or any other matter, or as having any rights
whatsoever as a stockholder of the Company. If, however, at any time prior to
the expiration of the Warrants and their exercise, any of the following events
shall occur:
(a) the Company shall take a record of the holder of its
shares of Common Stock for the purpose of entitling them to receive a
dividend or distribution payable otherwise than in cash, or a cash
dividend or distribution payable otherwise than out of current or
retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company; or
(b) the Company shall offer to all the holders of its Common
Stock any additional shares of capital stock of the Company or
securities convertible into or exchangeable for shares of capital stock
of the Company, or any option, right or warrant to subscribe therefor;
or
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale of
all or substantially all of its property, assets and business as an
entirety shall be proposed;
then, in any one or more of such events, the Company shall give written notice
of such event at least fifteen (15) days prior to the date fixed as a record
date or the date of closing the transfer books for the determination of the
stockholder entitled to such dividend, distribution, convertible or exchangeable
securities or subscription rights, or entitled to vote on such proposed
dissolution, liquidation, winding up or sale. Such notice shall specify such
record date or the date of closing the transfer books, as the case
-19-
may be. Failure to give such notice or any defect therein shall not affect the
validity of any action taken in connection with the declaration or payment of
any such dividend, or the issuance of any convertible or exchangeable
securities, or subscription rights, options or warrants, or any proposed
dissolution, liquidation, winding up or sale.
13. Notices.
All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been duly made and
sent when delivered, or mailed by registered or certified mail, return receipt
requested:
(a) If to the registered Holder of Warrants, to the address of
such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in Section 3
hereof or to such other address as the Company may designate by notice
to the Holder.
14. Supplements and Amendments. The Company and Underwriter
may from time to time supplement or amend this Agreement without the approval of
any holder of Warrant Certificates (other than Underwriter) in order to cure any
ambiguity, to correct or supplement any provision contained herein which may be
defective or inconsistent with any provisions herein, or to make any other
provisions in regard to matters or questions arising hereunder which the Company
and Underwriter may deem necessary or desirable and which the Company and
Underwriter deem shall not adversely affect the interests of the Holder of
Warrant Certificates. Any other amendment or supplement shall require consent of
the Company and holders of a majority in interest of Warrant Securities.
15. Successors. All the covenants and provisions of this
Agreement shall be binding upon and inure to the benefit of the Company, the
Holder and their respective successors and assigns hereunder.
-20-
16. Termination. This Agreement shall terminate at the close
of business on __________, 2006. Notwithstanding the foregoing, the
indemnification provisions of Section 7 shall survive such termination until the
close of business on ___________, 2010.
17. Governing Law; Submission to Jurisdiction. This Agreement
and each Warrant Certificate issued hereunder shall be deemed to be a contract
made under the laws of the State of New York and for all purposes shall be
construed in accordance with the laws of said State without giving effect to the
rules of said State governing the conflicts of law.
The Company, Underwriter and the Holders hereby agree that any
action, proceeding or claim against any of them arising out of, or relating in
any way to, this Agreement shall be brought and enforced in the courts of the
State of New York or of the United States of America for the Southern District
of New York, and irrevocably submits to such jurisdiction, which jurisdiction
shall be exclusive. The Company, Underwriter and the Holders hereby irrevocably
waive any objection to such exclusive jurisdiction or inconvenient forum. Any
such process or summons to be served upon any of the Company, Underwriter and
the Holders (at the option of the party bringing such action, proceeding or
claim) may be served by transmitting a copy thereof, by registered or certified
mail, return receipt requested, postage prepaid, addressed to it at the address
set forth in Section 13 hereof. Such mailing shall be deemed personal service
and shall be legal and binding upon the party so served in any action,
proceeding or claim. The Company, Underwriter and the Holders agree that the
prevailing party(ies) in any such action or proceeding shall be entitled to
recover from the other party(ies) all of its/their
-21-
reasonable legal costs and expenses relating to such action or proceeding and/or
incurred in connection with the preparation therefor.
18. Severability. If any provision of this Agreement shall be
held to be invalid or unenforceable, such invalidity or unenforceability shall
not affect any other provision of this Agreement.
19. Captions. The caption headings of the Sections of this
Agreement are for convenience of reference only and are not intended, nor should
they be construed as, a part of this Agreement and shall be given no substantive
effect.
20. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the Company
and Underwriter and any other registered Holder(s) of the Warrant Certificates
or Warrant Securities any legal or equitable right, remedy or claim under this
Agreement; and this Agreement shall be for the sole benefit of the Company and
Underwriter and any other registered Holders of Warrant Certificates or Warrant
Securities.
21. Counterparts. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and such counterparts shall together constitute but one and
the same instrument.
-22-
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, as of the day and year first above written.
OMNICORDER TECHNOLOGIES, INC.
By:
-------------------------------
Name:
Title:
Attest:
Secretary
CAMBRIDGE CAPITAL, LLC
By:
-------------------------------
Name:
Title:
-23-
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES ISSUABLE
UPON EXERCISE THEREOF MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), (ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY
SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (iii)
AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO
COUNSEL FOR THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER THE ACT IS
AVAILABLE.
THE TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS
CERTIFICATE IS RESTRICTED IN ACCORDANCE WITH THE WARRANT
AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., NEW YORK TIME, , 2004
No. W- Warrants to Purchase
Shares of Common Stock
WARRANT CERTIFICATE
This Warrant Certificate certifies that , or registered
assigns, is the registered holder of Warrants to purchase initially, at any time
from __________, 2000 until 5:30 p.m. New York time on __________, 2004
("Expiration Date"), up to _________ fully-paid and non-assessable shares of
common stock, par value $.01 per share ("Common Stock") of OMNICORDER
TECHNOLOGIES, INC., a Delaware corporation (the "Company"), (one share of Common
Stock referred to individually as a "Security" and collectively as the
"Securities") at the initial exercise price, subject to adjustment in certain
events (the "Exercise Price"), of $_____ per share of Common Stock upon
surrender of this Warrant Certificate and payment of the Exercise Price at an
office or agency of the Company, but subject to the conditions set forth herein
and in the warrant agreement dated as of __________, 1999 between the Company,
CAMBRIDGE CAPITAL, LLC (the "Warrant Agreement"). Payment of the Exercise Price
shall be made by certified or official bank check in New York Clearing House
funds payable to the order of the Company, unless otherwise set forth in the
Warrant Agreement.
-24-
No Warrant may be exercised after 5:30 p.m., New York time, on
the Expiration Date, at which time all Warrants evidenced hereby, unless
exercised prior thereto, hereby shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of
a duly authorized issue of Warrants issued pursuant to the Warrant Agreement,
which Warrant Agreement is hereby incorporated by reference in and made a part
of this instrument and is hereby referred to for a description of the rights,
limitation of rights, obligations, duties and immunities thereunder of the
Company and the holder (the words "holder" or "holders" meaning the registered
holder or registered holders) of the Warrants.
The Warrant Agreement provides that upon the occurrence of
certain events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
provided, however, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the rights
of the holder as set forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this
Warrant Certificate at an office or agency of the Company, a new Warrant
Certificate or Warrant Certificates of like tenor and evidencing in the
aggregate a like number of Warrants shall be issued to the transferee(s) in
exchange for this Warrant Certificate, subject to the limitations provided
herein and in the Warrant Agreement, without any charge except for any tax or
other governmental charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced
by this Certificate, the Company shall forthwith issue to the holder hereof a
new Warrant Certificate representing such number of unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof
as the absolute owner(s) of this Warrant Certificate (notwithstanding any
notation of ownership or other writing hereon made by anyone), for the purpose
of any exercise hereof, and of any distribution to the holder(s) hereof, and for
all other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined
in the Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
-25-
IN WITNESS WHEREOF, the Company has caused this Warrant
Certificate to be duly executed under its corporate seal.
Dated as of __________, 1998
OMNICORDER TECHNOLOGIES, INC.
[SEAL]
By:
-------------------------------
Name:
Title:
Attest:
Secretary
-26-
[FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 3.1]
The undersigned hereby irrevocably elects to exercise the
right, represented by this Warrant Certificate, to purchase:
__________ shares of Common Stock;
and herewith tenders in payment for such securities a certified or official bank
check payable in New York Clearing House Funds to the order of Omnicorder
Technologies, Inc. in the amount of $____, all in accordance with the terms of
Section 3.1 of the Underwriter's Warrant Agreement dated as of __________ __,
1998 between Omnicorder Technologies, Inc. and Cambridge Capital, LLC. The
undersigned requests that a certificate for such securities be registered in the
name of whose address is and that such Certificate be delivered to whose address
is .
Dated:
Signature (Signature must conform in
all respects to name of holder as
specified on the face of the Warrant
Certificate.)
(Insert Social Security or Other Identifying Number
of Holder)
-27-
[FORM OF ASSIGNMENT]
(To be executed by the registered holder if such
holder desires to transfer the Warrant
Certificate.)
FOR VALUE RECEIVED hereby sells, assigns and
transfer unto
(Please print name and address of transferee)
this Warrant Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint Attorney, to transfer the
within Warrant Certificate on the books of the within-named Company, with full
power of substitution.
Dated: Signature:
(Signature must conform in all respects to
name of holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Assignor)
-28-
