VEIN ASSOCIATES OF AMERICA, INC COMMON STOCK PURCHASE WARRANT
Exhibit
4.4
| THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR ANY STATE SECURITIES LAWS AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE 1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE 1933 ACT. |
| IN ADDITION, A PREFERRED STOCK PURCHASE AGREEMENT DATED AS OF MARCH 20, 2006 (THE “PURCHASE AGREEMENT”), A COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY AT ITS PRINCIPAL EXECUTIVE OFFICE, CONTAINS CERTAIN ADDITIONAL AGREEMENTS BETWEEN THE PARTIES WITH RESPECT TO THIS WARRANT. |
VEIN
ASSOCIATES OF AMERICA, INC
COMMON
STOCK PURCHASE WARRANT
| Number
of Shares: ______________ Original Issue Date: March_____, 2006 Expiration Date: _________________, 2011 |
Holder: Attn: |
Exercise Price per Share: $______ |
Tel:
Fax: |
Vein
Associates of America, Inc, a company organized and existing under the laws
of
the State of Florida (the “Company”), hereby certifies
that, for value received, __________________ or its registered assigns (the
“Warrant Holder”), is entitled, subject to the terms set
forth below, to purchase from the Company up to __________________ (__________)
shares (as adjusted from time to time as provided in Section 7, the
“Warrant Shares”) of common stock, $.001 par value (the
“Common Stock”), of the Company at a
price of _________
cents ($0.__) per Warrant Share (as adjusted from time to time as provided
in
Section 7, the “Exercise Price”), at any time and from
time to time from and after the date thereof and through and including 5:00
p.m.
New York City time on March ___, 2011 (the “Expiration Date”), and subject
to the following terms and conditions:
1.
Registration of Warrant. The Company shall register this
Warrant upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Warrant
Holder hereof from time to time. The Company may deem and treat the registered
Warrant Holder as the absolute owner hereof for the purpose of any exercise
hereof or any distribution to the Warrant Holder, and for all other purposes,
and the Company shall not be affected by notice to the contrary.
2.
Investment Representation. The Warrant Holder by
accepting this Warrant represents that the Warrant Holder is acquiring this
Warrant for its own account for investment purposes and not with the view to
any
offering or distribution and that the Warrant Holder will not sell or otherwise
dispose of this Warrant or the underlying Warrant Shares in violation of
applicable securities laws. The Warrant Holder acknowledges that the
certificates representing any Warrant Shares will bear a legend indicating
that
they have not been registered under the United States Securities Act of 1933,
as
amended (the “1933 Act”), and may not be sold by the
Warrant Holder except pursuant to an effective registration statement or
pursuant to an exemption from registration requirements of the 1933 Act and
in
accordance with federal and state securities laws. If this Warrant was acquired
by the Warrant Holder pursuant to the exemption from the registration
requirements of the 1933 Act afforded by Regulation S thereunder, the Warrant
Holder acknowledges and covenants that this Warrant may not be exercised by
or
on behalf of a Person during the one (1) year-distribution compliance period
(as
defined in Regulation S promulgated under the 0000 Xxx) following the date
hereof. “Person” means an individual, partnership, firm,
limited liability company, trust, joint venture, association, corporation or
any
other legal entity.
3.
Validity of Warrant and Issue of Shares. The Company
represents and warrants that this Warrant has been duly authorized and validly
issued. The Company further represents and warrants that all of the Common
Stock
that may be issued upon the exercise of the rights represented by this Warrant
will, when issued upon such exercise, be duly authorized, validly issued, fully
paid and nonassessable, and free from all taxes, liens and charges with respect
to the issue thereof. The Company further represents and warrants that during
the period within which the rights represented by this Warrant may be exercised,
the Company will at all times have authorized and reserved a sufficient number
of shares of Common Stock to provide for the exercise of the rights represented
by this Warrant.
4.
Registration of Transfers and Exchange of
Warrants.
a.
Subject to compliance with the legend set forth on the face of this Warrant,
the
Company shall register the transfer of any portion of this Warrant in the
Warrant Register, upon surrender of this Warrant together with the Form of
Assignment attached hereto duly completed and signed, to the Company at the
office specified in, or pursuant to, Section 12. Upon any such registration
or
transfer, a new warrant to purchase Common Stock, in substantially the form
of
this Warrant (any such new warrant, a “New Warrant”),
evidencing the portion of this Warrant so transferred shall be issued to the
transferee and a New Warrant evidencing the remaining portion of this Warrant
not so transferred, if any, shall be issued to the transferring Warrant Holder.
The acceptance of the New Warrant by the transferee thereof shall
2
be deemed
the acceptance of such transferee of all of the rights and obligations of a
Warrant Holder.
b.
This Warrant is exchangeable, upon the surrender hereof by the Warrant Holder
to
the office of the Company specified in, or pursuant to, Section 9 for one or
more New Warrants, evidencing in the aggregate the right to purchase the number
of Warrant Shares which may then be purchased hereunder. Any such New Warrant
will be dated the date of such exchange.
5.
Exercise of Warrants.
a.
Upon surrender of this Warrant together with the Form of Election to Purchase
attached hereto duly completed and signed to the Company, at its address set
forth in Section 12, and upon payment and delivery of the Exercise Price per
Warrant Share multiplied by the number of Warrant Shares that the Warrant Holder
intends to purchase hereunder, in lawful money of the United States of America,
in cash or by certified or official bank check or checks, to the Company, all
as
specified by the Warrant Holder in the Form of Election to Purchase, the Company
shall promptly (but in no event later than five (5) business days after the
Date
of Exercise (as defined herein)) cause to be issued and delivered to, or upon
the written order of, the Warrant Holder and in such name or names as the
Warrant Holder may designate (subject to the restrictions on transfer described
in the legend set forth on the face of this Warrant), a certificate for the
Warrant Shares issuable upon such exercise, with such restrictive legend as
required by the 1933 Act. Any person so designated by the Warrant Holder to
receive Warrant Shares shall be deemed to have become holder of record of such
Warrant Shares as of the Date of Exercise of this Warrant.
b.
A “Date of Exercise” means the date on which the Company shall have received (i)
this Warrant (or any New Warrant, as applicable), with the Form of Election
to
Purchase attached hereto (or attached to such New Warrant) appropriately
completed and duly signed and (ii) payment of the Exercise Price for the number
of Warrant Shares so indicated by the Warrant Holder to be purchased.
c.
This Warrant shall be exercisable at any time and from time to time for such
number of Warrant Shares as is indicated in the attached Form of Election to
Purchase. If less than all of the Warrant Shares which may be purchased under
this Warrant are exercised at any time, the Company shall cause to be issued,
at
its expense, a New Warrant evidencing the right to purchase the remaining number
of Warrant Shares for which no exercise has been made.
d.
(i)Notwithstanding anything contained herein to the contrary but subject to
Sections 5(e) and 6, the Warrant Holder may, at its election exercised in its
sole discretion, exercise this Warrant, in whole or in part, and, in lieu of
making the cash payment otherwise contemplated to be made to the Company upon
such exercise in payment of the aggregate Exercise Price, elect instead to
receive upon such exercise the “Net Number” of shares of Common
Stock determined according to the following formula (a “Cashless
Exercise”):
3
| Net Number = (A x (B — C))/B |
| (ii) For purposes of the foregoing formula: |
| A= the total number shares with respect to which this Warrant is then being exercised. |
| B= the last reported sale price (as reported by Bloomberg) of the Common Stock on the trading day immediately preceding the date of the Exercise Notice. |
| C= the Warrant Exercise Price then in effect at the time of such exercise. |
e. Notwithstanding
Section 5(d), this Warrant may not be exercised by means of a Cashless Exercise
unless (i) the Company fails to register the Warrant Shares pursuant to an
effective registration statement under the 1933 Act or (ii) the Company fails
to
file the reports required to be filed by the Company under the 1933 Act, the
Securities Exchange Act of 1934, as amended, or the rules and regulations
promulgated by the Securities and Exchange Commission thereunder. In
addition, a Cashless Exerciseof this Warrant may not be
madeuntil on or after the date that is six (6) months from the Original Issue
Date of this Warrant.
f.
Notwithstanding any other provision contained herein, if, at any time following
the registration of the Warrant Shares under the 1933 Act, the last reported
per
share sale price (as reported by Bloomberg) of the Common Stock for a period
of
twenty (20) consecutive trading days is not less than 175% of the Exercise
Price
then in effect hereunder, then the Company shall have the right, by delivery
of
written notice to the Warrant Holder, to require that the Warrant Holder
exercise the unexercised portion of this Warant in its entirety within five
(5)
trading days following receipt of such notice; provided, however,
in no event may the Company require the Warrant Holder to exercise this Warrant
in any manner which would result in a violation of the Beneficial Ownership
Limitation (as defined below).
6.
Maximum Exercise. The Warrant Holder shall not be
entitled to exercise thisWarrant on a Date of Exercise in connection with that
number of shares of Common Stock which would be in excess of the sum of (i)
the
number of shares of Common Stock beneficially owned by the Warrant Holder and
its affiliates on an exercise date and (ii) the number of shares of Common
Stock
issuable upon the exercise of this Warrant with respect to which the
determination of this limitation is being made on an exercise date, which would
result in beneficial ownership by the Warrant Holder and its affiliates of
more
than four and nine tenths percent (4.9%) of the outstanding shares of Common
Stock on such date (“Beneficial Ownership Limitation”). For the purposes of this
Section 6, beneficial ownership shall be determined in accordance with Section
13(d) of the Securities Exchange Act of 1934, as amended, and Regulation 13d-3
promulgated thereunder. The provisions of this Section 6(ii) shall be construed
and implemented in a manner otherwise in strict conformity with its terms,
to
correct this section (or any portion hereof) which may be defective or
inconsistent with the intended Beneficial
4
Ownership
Limitation herein contained or to make changes or supplements necessary or
desirable to properly give effect to such limitation.
7.
Adjustment of Exercise Price and Number of Shares. The
character of the shares of stock or other securities at the time issuable upon
exercise of this Warrant and the Exercise Price therefor, are subject to
adjustment upon the occurrence of the following events, and all such adjustments
shall be cumulative:
a.
Adjustment for Stock Splits, Stock Dividends, Recapitalizations,
Etc. The Exercise Price of this Warrant and the number of shares of
Common Stock or other securities at the time issuable upon exercise of this
Warrant shall be appropriately adjusted to reflect any stock dividend, stock
split, combination of shares, reclassification, recapitalization or other
similar event affecting the number of outstanding shares of stock or securities.
b.
Adjustment for Reorganization, Consolidation, Merger, Etc. In
case of any consolidation or merger of the Company with or into any other
corporation, entity or person, or any other corporate reorganization, in which
the Company shall not be the continuing or surviving entity of such
consolidation, merger or reorganization (any such transaction being hereinafter
referred to as a “Reorganization”) then, in each
case, the Warrant Holder, on exercise hereof at any time after the consummation
or effective date of such Reorganization (the “Effective
Date”), shall receive, in lieu of the shares of stock or other
securities at any time issuable upon the exercise of this Warrant prior to
the
Effective Date, the stock and other securities and property (including cash)
to
which such Warrant Holder would have been entitled upon the Effective Date
if
such Warrant Holder had exercised this Warrant immediately prior thereto (all
subject to further adjustment as provided in this Warrant).
c.
Certificate as to Adjustments. In case of any adjustment or
readjustment in the price or kind of securities issuable on the exercise of
this
Warrant, the Company will promptly give written notice thereof to the Warrant
Holder in the form of a certificate, certified and confirmed by the Company’s
Board of Directors, Chief Financial Officer (CFO) or Chief Executive Officer
(CEO), setting forth such adjustment or readjustment and showing in reasonable
detail the facts upon which such adjustment or readjustment is based.
d.
The Company fails to meet certain earnings per share
projections. In the event the Company earns between $0.01 and $0.0001
per share (where such earnings in this paragraph shall always be defined as
earnings on a pre taxed fully diluted basis as reported for the fiscal year
ended June 30, 2006 from recurring operations before any non recurring items
(such as fees paid or accrued by the Company in connection with funding obtained
under the Purchase Agreement, and the P&L impact of the Employee Stock
Option Plan implemented pursuant to paragraph 6.22 of the Purchase Agreement),
the Exercise Price shall be reduced proportionately by 0% if the earnings are
$0.01 per share and by 99% if the earnings are $0.0001 per share. For example,
if the Company earns $0.008 per share, or 20% below $0.01 per share, then the
Exercise Price shall be reduced by 20%. Such reduction shall be made at the
time
the June 30, 2006 financial results are reported and shall be made based on
the
Exercise Price in effect at that time, and shall be cumulative upon any other
changes to the Exercise Price of the
5
warrant
that may already have been made. In the event the Company earns below $0.0001,
or has a loss, the Exercise Price shall be reduced by 99%.
e.
In addition to any adjustment pursuant to Section 7 (d) of this Agreement,
in
the event the Company’s Pre-Tax Income for the year ended June 30, 2007 is
between $0.056 and $0.0001 per share on a fully-diluted basis, then the
conversion price shall be reduced proportionately by 0% if the fully-diluted
Pre
Tax Income is $0.056 per share or greater and by 99% if the fully-diluted Pre
Tax Income is $0.0001 per share or less. For example if the earnings are $0.045
per share (20% Decline) then the Conversion Price, as defined in the Certificate
of Designation, shall be reduced by 20% of the then current conversion price
per
share. Fully-diluted Pre-Tax Income Per Share shall be based on the number
of
outstanding shares of Common Stock plus all shares of Common Stock issuable
upon
conversion of all outstanding convertible securities and upon exercise of all
outstanding warrants, options and rights, regardless of whether (i) such shares
would be included in determining diluted earnings per share and (ii) such
convertible securities are subject to a restriction or limitation on exercise.
Thus, for purpose of determining fully-diluted Pre-Tax Income Per Share, the
four and nine tenths percent (4.9%) Limitation shall be disregarded. The
adjustment to the conversion price shall be made within five business days
of
the audited numbers being reported to the SEC.
f.
The Company sells, grants or issues any shares, options, warrants,
or
any instrument convertible into shares or equity in any form below the exercise
price per share of the warrant. In the event the Company sells, grants
or issues any shares, options, warrants, or any security convertible or
exercisable into shares of capital stock of the Company in any form below the
current Exercise Price, then the Exercise Price shall be reduced to such lower
price per share. Such reduction shall be made at the time such transaction
is
executed.
g.
Exempt Issuances. No adjustment shall be made under this
Section 7 on account of any Exempt Issuance. As used in this Section 7, the
term
“Exempt Issuance” means the issuance of (i) shares of Common Stock or options to
employees, officers or directors of the Company pursuant to any stock or option
plan duly adopted by a majority of the non-employee members of the board of
directors of the Company or a majority of the members of a committee of
non-employee directors established for such purpose; (ii) securities upon the
exercise of or conversion of any securities issued hereunder, convertible
securities, options or warrants issued and outstanding on the date of this
Warrant, provided that such securities have not been amended since the date
of
this Warrant to increase the number of such securities; (iii) securities issued
pursuant to acquisitions or strategic transactions, provided any such issuance
shall only be to a Person which is, itself or through its subsidiaries, an
operating company in a business synergistic with the business of the Company
and
in which the Company receives benefits in addition to the investment of funds,
but shall not include a transaction in which the Company is issuing securities
primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities; and (iv) securities repurchased by the
Company pursuant to a right of first refusal.
8.
Fractional Shares. The Company shall not be required to
cause to be issued fractional Warrant Shares on the exercise of this Warrant.
The number of full Warrant Shares that shall be issuable upon the exercise
of
this Warrant shall be computed on the basis of the
6
aggregate
number of Warrants Shares purchasable on exercise of this Warrant so presented.
If any fraction of a Warrant Share would, except for the provisions of this
Section 8, be issuable on the exercise of this Warrant, the Company shall pay
an
amount in cash equal to the Exercise Price multiplied by such fraction.
9.
Sale or Merger of the Company. Upon a Change in Control,
the restriction contained in Section 6(ii) shall immediately be released and
the
Warrant Holder will have the right to exercise this Warrant concurrently with
such Change in Control event, unless the Warrant Holder notifies the Company
within five (5) days of the Change in Control event that the Warrant Holder
wishes to retain such restriction. For purposes of this Warrant, the term
“Change in Control” shall mean a consolidation or merger of the Company with or
into another company or entity in which the Company is not the surviving entity
or the sale of all, or substantially all, of the assets of the Company to
another company or entity not controlled by the then existing stockholders
of
the Company in a transaction or series of transactions.
10.
Notice of Intent to Sell or Merge the Company. Subject
to the disclosure requirements of Regulation FD, The Company
will give Warrant Holder ten (10) business days notice before the event of
a
sale of all, or substantially all, of the assets of the Company or the merger
or
consolidation of the Company in a transaction in which the Company is not the
surviving entity.
11.
Issuance of Substitute Warrant. In the event of a
merger, consolidation, recapitalization or reorganization of the Company or
a
reclassification of the Company shares of stock, which results in an adjustment
to the number of shares subject to this Warrant and/or the Exercise Price
hereunder, the Company agrees to issue to the Warrant Holder a substitute
Warrant reflecting the adjusted number of shares and/or Exercise Price upon
the
surrender of this Warrant to the Company.
12.
Notice. All notices and other communications hereunder
shall be in writing and shall be deemed to have been given (i) on the date
they
are delivered if delivered in person; (ii) on the date initially received if
delivered by facsimile transmission followed by registered or certified mail
confirmation; (iii) on the date delivered by an overnight courier service;
or
(iv) on the third business day after it is mailed by registered or certified
mail, return receipt requested with postage and other fees prepaid as
follows: If to the Company:
| Vein Associates of America, Inc. |
| 000
Xxxxxxxxxxxxx Xxxxxxx Xxxxx 000 Xxxxxxxx, Xxxxxxx 00000 Facsimile No.: 407.708.5819 Attention: Xxxx Xxxxxxxxxxx |
| with a copy to: |
| Xxxxxxx, Xxxxxxxxx LLP |
7
| 0
Xxxx Xxxxxx Xxx Xxxx, Xxx Xxxx 00000 Facsimile No.: 212.545.3322 Attention: Xxxxxx X. Etna |
| If to the Warrant Holder: |
| To the address set forth on page 1 of this Warrant. |
13. Miscellaneous.
a. This
Warrant shall be binding on and inure to the benefit of the parties hereto
and
their respective successors and permitted assigns. This Warrant may be amended
only by a writing signed by the Company and the Warrant Holder.
b.
Nothing in this Warrant shall be construed to give to any Person, other than
the
Company and the Warrant Holder, any legal or equitable right, remedy or cause
of
action under this Warrant. This Warrant shall be for the sole and exclusive
benefit of the Company and the Warrant Holder.
c.
This Warrant shall be governed by, construed and enforced in accordance with
the
internal laws of the State of New York without regard to the principles of
conflicts of law thereof.
d.
The headings herein are for convenience only, do not constitute a part of this
Warrant and shall not be deemed to limit or affect any of the provisions hereof.
e.
In case any one or more of the provisions of this Warrant shall be invalid
or
unenforceable in any respect, the validity and enforceablilty of the remaining
terms and provisions of this Warrant shall not in any way be affected or
impaired thereby and the parties will attempt in good faith to agree upon a
valid and enforceable provision which shall be a commercially reasonably
substitute therefor, and upon so agreeing, shall incorporate such substitute
provision in this Warrant.
f.
The Warrant Holder shall not, by virtue hereof, be entitled to any voting or
other rights of a shareholder of the Company, either at law or equity, and
the
rights of the Warrant Holder are limited to those expressed in this Warrant.
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IN WITNESS
WHEREOF, the
Company has caused the execution and delivery ofthis Warrant as of the Original
Issue Date set forth above.
Vein
Associates of America, Inc.
By:
/s/ Xxxx
Xxxxxxxxxxx
Name: Xxxx Xxxxxxxxxxx, President
Name: Xxxx Xxxxxxxxxxx, President
FORM
OF ELECTION TO PURCHASE
(To
be
executed by the Warrant Holder to exercise the right to purchase shares of
Common Stock under the foregoing Warrant)
To:
Vein
Associates of America, Inc:
In
accordance with the Warrant enclosed with this Form of Election to Purchase,
the
undersigned hereby irrevocably elects to purchase ______________ shares of
Common Stock (“Common Stock”), $.001 par value, of Vein Associates of America,
Inc, and encloses the Warrant and $____ for each share of Common Stock being
purchased or an aggregate of $_____________ in cash or certified or official
bank check or checks, which sum represents the aggregate Exercise Price (as
defined in the Warrant) together with any applicable taxes payable by the
undersigned pursuant to the Warrant. Alternately, subject to the limitations
of
Section 5(e) of this Warrant, the undersigned elects to make a Cashless Exercise
pursuant to Section 5(d), to receive a Net Number of ___________ Warrant Shares
(using the last reported sale price of $_______).
The
undersigned requests that certificates for the shares of Common Stock issuable
upon this exercise be issued in the name of:
_____________________________________________
_____________________________________________
_____________________________________________
(Please print name and address)
(Please print name and address)
_____________________________________________
(Please insert Social Security or Tax Identification Number)
(Please insert Social Security or Tax Identification Number)
If the
number of shares of Common Stock issuable upon this exercise shall not be all
of
the shares of Common Stock which the undersigned is entitled to purchase in
accordance with the enclosed Warrant, the undersigned requests that a New
Warrant (as defined in the Warrant) evidencing the right to purchase the shares
of Common Stock not issuable pursuant to the exercise evidenced hereby be issued
in the name of and delivered to:
_____________________________________________
_____________________________________________
_____________________________________________
(Please print name and address)
(Please print name and address)
| Dated:______________ | Name of Warrant Holder: |
| (Print)_________________________________________ (By:)__________________________________________ (Name:)________________________________________ (Title:)_________________________________________ |
| Signature
must conform in all respects to name of Warrant Holder as specified on the face of the Warrant |
