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Exhibit 10.1
MATRITECH, INC.
INVESTOR RELATIONS WARRANT AGREEMENT
Dated: July 14, 2000
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THIS WARRANT AGREEMENT (this "Agreement") dated July 14, 2000 is made
and entered into by and between Matritech, Inc., a corporation organized under
the laws of the State of Delaware (the "Company"), and the individuals set forth
on Exhibit A hereto (collectively, the "Warrantholders" or "Holders,"
individually, each a "Warrantholder" or "Holder").
Subject to the terms and conditions hereof, the Company agrees to issue
to each Warrantholder warrants as hereinafter described (the "Warrants") to
purchase the shares of the common stock, par value $.01 per share (the "Common
Stock"), of the Company set forth opposite each Warrantholder's respective name
on Exhibit A. As used herein, the terms "Share" or "Shares" shall mean
collectively the Common Stock issuable upon exercise of the Warrants together
with any other securities issuable upon such exercise as provided in Section 8
of this Agreement. Except where otherwise specified, the terms of this Agreement
shall apply to each Warrantholder.
For the purpose of defining the terms and provisions of the Warrants
and the respective rights and obligations thereunder, the Company and each
Warrantholder, for value received, hereby agree as follows:
Section 1. TRANSFERABILITY AND FORM OF WARRANTS.
1.1. REGISTRATION. The Warrants shall be numbered and shall be
registered on the books of the Company when issued, in accordance with Delaware
corporate practice.
1.2. TRANSFER. The Warrants shall be transferable only on the books of
the Company maintained at its principal office in Newton, Massachusetts, or
wherever its principal office may then be located, upon delivery thereof duly
endorsed by the Warrantholder seeking such transfer or by its duly authorized
attorney or representative, accompanied by proper evidence of succession,
assignment or authority to transfer. Upon any registration of transfer, the
Company shall execute and deliver new Warrants to the person entitled thereto.
1.3. LIMITATIONS ON TRANSFER OF THE WARRANTS. Subject to the provisions
of Section 11 of this Agreement, the Warrants shall not be sold, assigned,
hypothecated or otherwise transferred except to any person acquiring the
Warrants upon the death of a Warrantholder by will or the laws of descent and
distribution. The term "Warrants" shall include any and all warrants outstanding
pursuant to this Agreement, including those evidenced by a certificate or
certificates issued upon division, exchange, substitution or transfer pursuant
to this Agreement.
1.4. FORM OF WARRANTS. The form of certificate evidencing the Warrants
shall be substantially as set forth in Exhibit B attached hereto. Certificates
evidencing the Warrants shall be executed on behalf of the Company by its
Chairman, President or by any Vice President, shall be attested to by its
Secretary or any Assistant Secretary, and shall be dated as of the date of
execution thereof.
1.5. LEGEND ON COMMON STOCK. The Warrants, and the Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"). Each
certificate for
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Shares shall bear the following legend unless, at the time of exercise, such
Shares are the subject of a currently effective registration statement under the
Act:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. SUCH SECURITIES MAY NOT
BE SOLD, ASSIGNED, EXCHANGED, HYPOTHECATED OR
OTHERWISE TRANSFERRED IN ANY MANNER EXCEPT IN
COMPLIANCE WITH SECTION 11 OF THE WARRANT AGREEMENT
BY AND BETWEEN THE ISSUER AND THE ORIGINAL HOLDERS OF
THESE SECURITIES DATED JULY 14, 2000."
Any certificate issued at any time in exchange or substitution for any
certificate bearing such legend (except a new certificate issued upon completion
of a public distribution pursuant to a registration statement under the Act of
the securities represented thereby) shall also bear the above legend unless, in
the opinion of the Company's counsel, the securities represented thereby need no
longer be subject to such restrictions.
Section 2. EXCHANGE OF WARRANT CERTIFICATE. Any Warrant certificate may
be exchanged for another certificate or certificates entitling a Warrantholder
to purchase a like aggregate number of Shares as the certificate or certificates
surrendered then entitles such Warrantholder to purchase. Any Warrantholder
desiring to exchange a Warrant certificate shall make such request in writing
delivered to the Company, and shall surrender, properly endorsed, the
certificate evidencing the Warrant to be so exchanged. Thereupon, the Company
shall execute and deliver to the person entitled thereto a new Warrant
certificate as so requested.
Section 3. TERM OF WARRANTS; EXERCISE OF WARRANTS
(a) Subject to the terms of this Agreement, each Warrantholder shall
have the right, at any time during the period commencing at 9:00 a.m., Eastern
Time, on July 14, 2000 (the "Commencement Date") and ending at 5:00 p.m.,
Eastern Time, on July 14, 2005 (the "Termination Date"), to purchase from the
Company up to the number of fully paid and nonassessable Shares which such
Warrantholder may at the time be entitled to purchase pursuant to this
Agreement, upon surrender to the Company at its principal office of the
certificates evidencing the Warrants to be exercised, with the purchase form on
the reverse thereof duly completed and signed, and upon payment to the Company
of the Warrant Price (as defined in and determined in accordance with the
provisions of this Section 3 and Sections 7 and 8 hereof) for the number of
Shares in respect of which such Warrants are then exercised, but in no event for
fewer than 100 Shares (unless fewer than an aggregate of 100 Shares are then
purchasable under all outstanding Warrants held of record by a Warrantholder).
Payment of the aggregate Warrant Price shall be made in cash or by certified or
cashier's check, in next day funds, or any combination thereof.
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(b) Upon surrender of Warrant certificates and payment of the Warrant
Price, the Company shall issue and cause to be delivered with all reasonable
dispatch to or upon the written order of a Warrantholder, and (subject to
Section 11 hereof) in such name or names as such Warrantholder may designate, a
certificate or certificates for the number of full Shares so acquired upon the
exercise of the Warrant, together with cash, as provided in Section 9 hereof, in
respect of any fractional Shares otherwise issuable upon such surrender. Such
certificate or certificates shall be deemed to have been issued and any person
so designated to be named therein shall be deemed to have become a holder of
record of such Shares as of the date of surrender of the Warrants being
exercised and payment of the Warrant Price notwithstanding that the certificate
or certificates representing such securities shall not actually have been
delivered or that the stock transfer books of the Company shall then be closed.
The Warrants shall be exercisable at the election of a Warrantholder either in
full or from time to time in part and, in the event that a certificate
evidencing Warrants is exercised in respect of fewer than all of the Shares
specified therein at any time prior to the Termination Date, a new certificate
evidencing the remaining portion of the Warrants shall be issued by the Company.
Section 4. PAYMENT OF TAXES. The Company will pay all taxes and fees,
if any (other than any income taxes that may be imposed on the exercise of the
Warrants or on the subsequent sale of the Shares), attributable to the initial
issuance of the Warrants or the issuance of Shares upon exercise of the
Warrants; provided that the Company shall not be required to pay any tax or fee
which may be payable in respect of any secondary transfer of the Warrants or
such Shares.
Section 5. MUTILATED OR MISSING WARRANTS. In case the certificate or
certificates evidencing any Warrants shall be mutilated, lost, stolen or
destroyed, the Company shall, at the request of the affected Warrantholder,
issue and deliver in exchange and substitution for and upon cancellation of the
mutilated certificate or certificates, or in lieu of and substitution for the
certificate or certificates lost, stolen or destroyed, a new Warrant certificate
or certificates of like tenor and representing an equivalent right or interest,
but only upon receipt of evidence satisfactory to the Company of the loss, theft
or destruction of such Warrant and, if requested, at the cost and expense of the
Warrantholder, a bond of indemnity in form and amount satisfactory to the
Company. Applicants for such substitute Warrants certificate shall also comply
with such other reasonable regulations as the Company may prescribe.
Section 6. RESERVATION OF COMMON STOCK. There has been reserved, and
the Company shall at all times keep reserved so long as any Warrants remain
outstanding, out of its authorized share capital, such number of Common Stock as
shall be subject to purchase under all outstanding Warrants. Every transfer
agent for the Common Stock and other securities of the Company issuable upon the
exercise of Warrants will be irrevocably authorized and directed at all times to
reserve such number of authorized shares of Common Stock and other securities as
shall be requisite for such purpose. The Company will keep a copy of this
Agreement on file with every transfer agent for the Common Stock and other
securities of the Company issuable upon the exercise of the Warrants. The
Company will supply every such transfer agent with duly executed stock
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and other certificates, as appropriate, for such purpose and will provide or
otherwise make available any cash which may be payable as provided in Section 9
hereof.
Section 7. WARRANT PRICE. "Warrant Price" shall mean the price per
Share at which Shares shall at any time be purchasable upon the exercise of the
Warrants. The initial Warrant Price shall be $2.50, subject to adjustment
pursuant to Section 8 hereof.
Section 8. ADJUSTMENT OF NUMBER AND KIND OF SECURITIES. The number and
kind of securities purchasable upon the exercise of the Warrants and the Warrant
Price shall be subject to adjustment from time to time upon the happening of
certain events, as follows:
8.1. ADJUSTMENTS.
(a) In case the Company shall (i) pay a dividend in Common
Stock or make a distribution in Common Stock, (ii) subdivide its
outstanding Common Stock, (iii) combine its outstanding Common Stock
into a smaller number of shares of Common Stock, or (iv) issue, by
reclassification of its Common Stock, other securities of the Company,
the number of Shares or other securities purchasable upon exercise of
the Warrants immediately prior thereto shall be adjusted so that each
Warrantholder shall be entitled to receive the kind and number of
shares of Common Stock or other securities of the Company which it
would have owned or would have been entitled to receive immediately
after the happening of any of the events described above, had the
Warrants been exercised immediately prior to the happening of such
event or any record date with respect thereto. Any adjustment made
pursuant to this subsection 8.1(a) shall become effective immediately
on the effective date of such event retroactive to the record date, if
any, for such event.
(b) In case the Company shall issue rights, options, warrants
or convertible securities to all or substantially all holders of its
Common Stock without any charge to such holders, entitling them to
subscribe for or purchase shares of Common Stock at a price per share
which, at the record date mentioned below, is lower than the then
effective Warrant Price (calculated pursuant to this Section 8), the
number of Shares thereafter purchasable upon the exercise of each
Warrant shall be determined by multiplying the number of Shares
theretofore purchasable upon exercise of the Warrant by a fraction, of
which the numerator shall be the number of shares of Common Stock
outstanding immediately prior to the issuance of such rights, options,
warrants or convertible securities plus the number of additional Common
Stock offered for subscription or purchase, and of which the
denominator shall be the number of shares of Common Stock outstanding
immediately prior to the issuance of such rights, options, warrants or
convertible securities plus the number of shares which the aggregate
offering price of the total number of shares offered would purchase at
such then effective Warrant Price. Such adjustment shall be made
whenever such rights, options, warrants or convertible securities are
issued, and shall become effective immediately and retroactive to the
record date for the determination of shareholders entitled to receive
such rights, options, warrants or convertible
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securities, provided no such adjustment shall be made for rights issued
in connection with what is customarily referred to as a "poison pill"
or "shareholder rights plan."
(c) In case the Company shall distribute to all or
substantially all holders of its Common Stock evidences of its
indebtedness or assets (excluding cash dividends or distributions out
of earnings) or rights, options, warrants or convertible securities
containing the right to subscribe for or purchase Shares (excluding
those referred to in subsection 8.1(b) above and rights in connection
with a shareholder rights plan), then in each case the number of Shares
thereafter purchasable upon the exercise of the Warrants shall be
determined by multiplying the number of Shares theretofore purchasable
upon exercise of the Warrants by a fraction, of which the numerator
shall be the then effective Warrant Price as of the date of such
distribution calculated pursuant to this Section 8, and of which the
denominator shall be such then effective Warrant Price on such date
minus the then fair value (determined as provided in subparagraph (f)
below) of the portion of the assets or evidences of indebtedness so
distributed or of such subscription rights, options, warrants or
convertible securities applicable to one share. Such adjustment shall
be made whenever any such distribution is made and shall become
effective on the date of distribution retroactive to the record date
for the determination of shareholders entitled to receive such
distribution.
(d) No adjustment in the number of Shares purchasable pursuant
to the Warrants shall be required unless such adjustment would require
an increase or decrease of at least one percent in the number of Shares
then purchasable upon the exercise of the Warrants or, if the Warrants
are not then exercisable, the number of Shares purchasable upon the
exercise of the Warrants on the first date thereafter that the Warrants
become exercisable; provided that any adjustments which by reason of
this subsection 8.1(d) are not required to be made immediately shall be
carried forward and taken into account in any subsequent adjustment.
(e) Whenever the number of Shares purchasable upon the
exercise of a Warrant is adjusted, as herein provided, the Warrant
Price payable upon exercise of such Warrant shall be adjusted by
multiplying such Warrant Price immediately prior to such adjustment by
a fraction, of which the numerator shall be the number of Shares
purchasable upon the exercise of the Warrant immediately prior to such
adjustment, and of which the denominator shall be the number of Shares
so purchasable upon the exercise of the Warrant immediately thereafter.
(f) Whenever the number of Shares purchasable upon the
exercise of Warrants is adjusted as herein provided, the Company shall
cause to be promptly mailed to the Warrantholders by first class mail,
postage prepaid, notice of such adjustment and a certificate of the
chief financial officer of the Company setting forth the number of
Shares purchasable upon the exercise of the Warrants after such
adjustment, a brief statement of the facts requiring such adjustment
and the computation by which such adjustment was made.
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(g) For the purpose of this subsection 8.1, the term Common
Stock shall mean (i) the class of Common Stock designated as the Common
Stock of the Company at the date of this Agreement, or (ii) any other
class of shares resulting from successive changes or reclassification
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. In the
event that at any time, as a result of an adjustment made pursuant to
this Section 8, a Warrantholder shall become entitled to purchase any
securities of the Company other than Common Stock, (i) if the
Warrantholders' right to purchase is on any other basis than that
available to all holders of the Common Stock, the Company shall obtain
an opinion of an independent investment banking firm valuing such other
securities and (ii) thereafter the number of such other securities so
purchasable upon exercise of the Warrants shall be subject to
adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common
Stock contained in this Section 8.
(h) Upon the expiration of any rights, options, warrants or
conversion privileges, if such shall not have been exercised, the
number of Shares purchasable upon exercise of the Warrants, to the
extent the Warrants have not then been exercised, shall, upon such
expiration, be readjusted and shall thereafter be such as they would
have been had they been originally adjusted (or had the original
adjustment not been required, as the case may be) on the basis of (A)
the fact that the only shares of Common Stock so issued were the shares
of Common Stock, if any, actually issued or sold upon the exercise of
such rights, options, warrants or conversion privileges, and (B) the
fact that such shares of Common Stock, if any, were issued or sold for
the consideration actually received by the Company upon such exercise
plus the consideration, if any, actually received by the Company for
the issuance, sale or grant of all such rights, options, warrants or
conversion privileges whether or not exercised; provided, however, that
no such readjustment shall have the effect of decreasing the number of
Shares purchasable upon exercise of the Warrants by an amount in excess
of the amount of the adjustment initially made in respect of the
issuance, sale or grant of such rights, options, warrants or conversion
privileges.
8.2. NO ADJUSTMENT FOR DIVIDENDS. Except as provided in subsection 8.1,
no adjustment to the Warrants or any provision or condition thereof in respect
of any dividends or distributions out of earnings shall be made during the term
of the Warrants or upon the exercise of Warrants.
8.3. NO ADJUSTMENT IN CERTAIN CASES. No adjustments to the Warrants or
any provision or condition thereof shall be made pursuant to Section 3 or
Section 8 hereof in connection with (i) the issuance of Common Stock upon
exercise of the Warrants, (ii) the grant or exercise of the options to purchase
Common Stock under the Company's Stock Plans or any future option plan for the
sole benefit of the Company's employees, consultants and directors, or (iii) the
issuance of securities in an equity financing regardless of the offering price.
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8.4. PRESERVATION OF PURCHASE RIGHTS UPON RECLASSIFICATION,
CONSOLIDATION, ETC. In case of any consolidation of the Company with or merger
of the Company into another entity or in case of any sale or conveyance to
another entity of the property, assets or business of the Company as an entirety
or substantially as an entirety, the Company or such successor or purchasing
entity, as the case may be, shall execute with the Warrantholders an agreement
that the Warrantholders shall have the right thereafter, upon exercise of the
Warrants and payment of the Warrant Price in effect immediately prior to such
consolidation, merger or sale, to purchase the kind and amount of shares and
other securities and property which it would have been entitled to receive after
the happening of such consolidation, merger, sale or conveyance had the Warrants
been exercised immediately prior thereto. In the event of a merger described in
Section 368(a)(2)(E) of the Internal Revenue Code of 1986 (or any successor
provision), in which the Company is the surviving corporation, the right to
purchase Shares under the Warrants shall terminate on the date of such merger
and thereupon the Warrants shall become null and void, but only if the
controlling corporation (after such event) shall agree to substitute for the
Warrants its warrants entitling the holder thereof to purchase the kind and
amount of shares and other securities and property which it would have been
entitled to receive had the Warrants been exercised immediately prior to such
merger. Any such agreements referred to in this subsection 8.4 shall provide for
adjustments, which shall be as nearly equivalent as may be practicable to the
adjustments provided for in Section 8 hereof, and shall contain substantially
the same terms, conditions and provisions as are contained herein immediately
prior to such event. The provisions of this subsection 8.4 shall similarly apply
to successive consolidations, mergers, sales or conveyances.
8.5. NOMINAL VALUE OF COMMON STOCK. Before taking any action which
would cause an adjustment effectively reducing the portion of the Warrant Price
allocable to each Share below the then nominal value per Share issuable upon
exercise of the Warrants, the Company will take any corporate action which may,
in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue fully paid and nonassessable Shares upon exercise of
the Warrants.
8.6. INDEPENDENT PUBLIC ACCOUNTANTS. The Company may retain a firm of
independent public accountants of recognized national standing in the United
States (which may be any such firm regularly employed by the Company) to make
any computation required under this Section 8, and a certificate signed by such
firm shall be evidence of the correctness of any computation made under this
Section 8.
8.7. STATEMENT ON WARRANT CERTIFICATES. Irrespective of any adjustments
in the number of securities issuable upon exercise of Warrants, Warrant
certificates theretofore or thereafter issued may continue to express the same
number of securities as are stated in the similar Warrant certificates initially
issuable pursuant to this Agreement. However, the Company may, at any time in
its reasonable discretion, make any change in the form of Warrant certificate
that it may deem appropriate and that does not affect the substance thereof; and
any Warrant certificate hereafter issued, whether upon registration of transfer
of, or in exchange or substitution for, an outstanding Warrant certificate, may
be in the form so changed.
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Section 9. FRACTIONAL INTERESTS; MARKET PRICE. The Company shall not be
required to issue fractional Shares upon the exercise of any Warrant. If any
fraction of a Share would, except for the provisions of this Section 9, be
issuable on the exercise of any Warrant (or specified portion thereof), the
Company shall pay an amount in cash equal to the Market Price multiplied by such
fraction. For all purposes of this Agreement, the term Market Price as of any
specified date shall mean (i) if the Common Stock is traded in the United States
over-the-counter market and not on the Nasdaq System or on any United States
national securities exchange, the average of the mean between the bid and asked
prices of the Common Stock on each of the five consecutive trading days
immediately preceding the date in question, as reported by the National
Quotation Bureau Incorporated or an equivalent generally accepted reporting
service, or (ii) if the Common Stock is traded on the Nasdaq System or on one or
more United States national securities exchanges, the average, for the five
consecutive trading days immediately preceding the date in question, of the
daily closing price of the Common Stock on the Nasdaq System or the daily
closing price for consolidated transactions on the principal United States
national securities exchange on which the Common Stock is listed, or (iii) if
the Common Stock is not traded in the United States over-the-counter market, the
Nasdaq System or any United States national securities exchange, the average,
for the five consecutive trading days immediately preceding the date in
question, of the daily closing price of the Common Stock on the principal
non-United States exchange on which the Common Stock is listed. The daily
closing price referred to in clauses (ii) and (iii) above shall be the last
reported sale price on the day in question or, if no reported sale takes place
on such day, the average of the reported closing bid and asked prices.
Section 10. NO RIGHTS AS SHAREHOLDER; NOTICES TO WARRANTHOLDERS.
Nothing contained in this Agreement or in the Warrants shall be construed as
conferring upon the Warrantholder or any transferee of a Warrant any rights as a
shareholder of the Company, including (without limitation) the right to vote,
receive dividends, consent or receive notices as a shareholder in respect of any
meeting of shareholders for the election of directors of the Company or any
other matter. If, however, at any time prior to the expiration of the Warrants
and prior to their exercise in full, any one or more of the following events
shall occur:
(a) any action which would require an adjustment pursuant to
Section 8.1 or 8.4; or
(b) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation, merger or sale of its
property, assets and business as an entirety or substantially as an
entirety) shall be proposed;
then the Company shall give notice in writing of such event to each of the
Warrantholders, as provided in Section 14 hereof, at least 20 days prior to the
date fixed as a record date or the date of closing the transfer books for the
determination of the shareholders entitled to any relevant dividend,
distribution, subscription rights or other rights or for the determination of
shareholders entitled to vote on such proposed dissolution, liquidation or
winding up. Such notice shall specify such record date or the
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date of closing the transfer books, as the case may be. Failure to mail or
receive such notice or any defect therein shall not affect the validity of any
action taken with respect thereto.
Section 11. RESTRICTIONS ON TRANSFER; REGISTRATION RIGHTS.
(a) There shall be no transfers of Warrants except as
permitted pursuant to Section 1.3 hereof. If any Warrantholder proposes to sell
or otherwise transfer any Shares, and if such Shares are not then registered for
resale pursuant to an effective registration statement under the Act, the
Warrantholder proposing to make such transfer shall give written notice to the
Company describing briefly the manner in which any such proposed transfer is to
be made; and no such transfer shall be made unless the Company shall notify such
Warrantholder that in the opinion counsel reasonably satisfactory to such
Warrantholder, registration under the Act is not required with respect to such
transfer.
(b) Subject to the provisions set forth in this Section 11, if
at any time during the period prior to the Termination Date the Shares are not
subject to an effective registration statement under the Act (a "Registration
Statement"), the Company shall be obligated to the Warrantholders and the
registered holders of the Shares issued upon exercise of the Warrants
(collectively with the Warrantholders, the "Holders"), as follows:
(i) Whenever during the five-year period beginning on
the Commencement Date and ending on the Termination Date, the Company
proposes to file with the Securities and Exchange Commission (the
"Commission") a Registration Statement (other than a registration
statement on Form S-8 (or other form) relating solely to securities
issued pursuant to an employee benefit plan, or a registration
statement on Form F-4 or S-4 or any successor form thereto), the
Company shall, at least 30 days prior to each such proposed filing,
give written notice (the "Piggyback Notice") thereof to the Holders at
their respective addresses appearing on the records of the Company, and
shall offer to include and shall include in such filing any Shares as
to which written requests (the "Piggyback Request") for such inclusion
are received by the Company from Holders not more than 20 days after
such Piggyback Notice is mailed to the Holders. The Shares which are
the subject of a valid Piggyback Request from Holders are hereinafter
referred to as the "Piggyback Shares." If such registration statement
relates in whole or in part to an underwritten public offering of the
Common Stock by the Company, the right of any Holder to registration
pursuant to this Section 11(b) shall be conditioned upon such Holder's
participation in any underwriting of the Company's public offering. All
Holders proposing to distribute their Piggyback Shares through such
underwriting shall (together with the Company and other holders of
Common Stock participating in such underwriting) enter into an
underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting by the Company. In
addition, if, after the number of Piggyback Shares is
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determined, the managing underwriter of such offering determines that
marketing factors require a limitation on the number of shares of
Common Stock to be underwritten other than those to be offered by the
Company for its own account, the managing underwriter may exclude any
or all of the Piggyback Shares from such registration statement and
underwriting, but only to the extent that the Company excludes Common
Stock which other shareholders of the Company have requested the
Company to include in such registration statement and underwriting
pursuant to "piggyback rights" similar to those granted in this Section
11(b) (such other Common Stock which is the subject of such requests
are hereinafter referred to as "Other Piggyback Shares"). In the event
that any Piggyback Shares are so excluded, the number of Piggyback
Shares and Other Piggyback Shares that shall be included in such
registration statement and underwriting shall be allocated equally
among all Holders and the holders of Other Piggyback Shares in
proportion, as nearly as practicable, to the total number of Piggyback
Shares and Other Piggyback Shares. The rights granted to a Holder under
this subparagraph shall terminate upon the failure by such Holder to
submit a valid Piggyback Request to the Company upon receipt of a
Piggyback Notice.
(ii) In addition to any Registration Statement pursuant to
subparagraph (i) above, during the five-year period beginning on the
Commencement Date and ending on the Termination Date, the Company
shall, as promptly as practicable (but in any event within 75 days),
after receipt of a written request (the "Registration Request") by a
Holder or Holders holding of record (or having the right to acquire
upon exercise of Warrants) at least 75% of the total number of shares
of Common Stock issuable upon exercise of the Warrants, prepare and
file with the Commission at the Holders' expense a Registration
Statement, and (if required) any related filing with any State
securities regulator, sufficient to permit the public offering of the
Shares covered by the Registration Request. Within ten days of the
Company's receipt of a Registration Request, it shall give written
notice thereof to the Holders who did not join in the Registration
Request, at their respective addresses appearing on the records of the
Company, and shall offer to include and shall include in such
Registration Statement any Shares as to which written requests for such
inclusion are received by the Company from such Holders not more than
20 days after the Company's notice is mailed to such Holders. The
Company will use its best efforts, at the Holders' expense, to cause
such Registration Statement to become effective under the Act as
promptly as practicable and to maintain such effectiveness until the
earlier of the time that all the registered Shares have been sold or
the expiration of three hundred sixty-five (365) days from the
effective date of the Registration Statement. The Company shall be
required to file not more than one Registration Statement under this
Section 11(b)(ii).
(c) In connection with any Registration Statement filed
pursuant to paragraph (b) of this Section 11, the Company shall take such action
as may be necessary
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or appropriate to comply with the securities or blue sky laws of such states of
the United States as shall reasonably be requested by the Holders, and shall do
any and all other acts which may be necessary or advisable to permit the
proposed sale or other disposition of the Shares in any such state; provided
that in no event shall the Company be obligated in connection therewith to
qualify as a foreign corporation or as a dealer in any jurisdiction where it is
not already so qualified, or to execute a general consent for service of process
in suits other than those arising out of the offer and sale of the Shares, or to
take any action which would subject it to taxation in any jurisdiction where it
is not then so subject.
(d) The Company's obligations under paragraph (b) of this
Section 11 with respect to any Holder shall be conditioned in each instance upon
the timely receipt by the Company in writing of (i) information from such Holder
as to the proposed plan of distribution of such Holder's Shares to be included
in a Registration Statement, and (ii) such other information as may be required
by law from such holder, or its underwriter or other agent, for inclusion in
such Registration Statement.
(e) Each Holder will not make any sale of the Shares, pursuant
to the Registration Statement referred to in this Section 11 without effectively
causing the prospectus delivery requirements under the Securities Act to be
satisfied. Each Holder acknowledges that there may occasionally be times when
the Company must suspend the use of the prospectus forming a part of the
Registration Statement until such time as an amendment to such registration
statement has been field by the Company and declared effective by the Commission
or until the Company has amended or supplemented such prospectus. The Company
will use its best efforts to cause such amended registration statement to be
declared effective and/or to deliver such amended or supplemented prospectus as
soon as possible. Each Holder hereby covenants that it will not sell any Shares
pursuant to said prospectus without first confirming with the Company that the
Registration Statement has not been suspended, and during the period commencing
at the time at which the Company gives the Holder notice of the suspension of
the use of said prospectus and ending at the time the Company gives the Holder
notice that the Holder may thereafter effect sales pursuant to said prospectus.
(f) The Holders shall pay all fees, disbursements and
out-of-pocket expenses payable in connection with (i) any Registration Statement
filed under paragraph 11(b), and (ii) compliance with applicable state
securities and blue sky laws. In connection with registrations pursuant to
paragraph 11(b) (i) hereof, each Holder shall also pay its pro-rata portion of
any filing fee required by the Securities and Exchange Commission. The Company
at the Holders' expense will supply the Holders of Shares included in a
Registration Statement with copies of such Registration Statement and the
prospectus included therein and other related documents and opinions and
no-action letters, in such quantities as may be reasonably requested by such
Holders. In connection with each Registration Statement, the Company shall
furnish to Holders of Shares included therein such opinions of counsel, comfort
letters of accountants, certificates and other documents that are customary in
connection with underwritten public offerings and that are reasonably requested
by such Holders.
-11-
13
(g) The Company shall not be required by this Section 11 to
include or maintain in any Registration Statement any Shares which, in the
opinion of counsel for the Company, could be sold pursuant to Rule 144 under the
Act in any three-month period without volume limitation.
(h) The Company represents that the registration rights
provided in this Section 11 are not inconsistent with, and will in no way be
limited by, registration rights previously granted by the Company to its
securityholders.
Section 12. INDEMNIFICATION.
(a) In the event that any Registration Statement is filed
pursuant to Section 11 hereof, the Company will indemnify and hold harmless each
Holder identified as a selling security holder therein, and each person, if any,
who controls such Holder within the meaning of the Act, against any and all
losses, claims, damages or liabilities, joint or several (including any
reasonable investigation, legal and other expenses incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding or any
claim asserted), to which they or any of them may become subject under the Act,
the Securities Exchange Act of 1934, as amended (the "Exchange Act") or other
federal or state law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in any such Registration Statement, any related
preliminary prospectus, final prospectus, or amendment thereof or supplement
thereto, or any related blue sky filing, or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; provided that the Company shall not be
liable under this section 12(a) in any such case to the extent that any such
losses, claims, damages or liabilities arise solely out of or are based upon an
untrue statement of a material fact contained in, or any omission of a material
fact from, such Registration Statement, preliminary prospectus, final prospectus
or amendment thereof or supplement thereto in reliance upon, and in conformity
with, information furnished in writing to the Company by such Holder
specifically for use therein. This indemnity will be in addition to any
liability which the Company may otherwise have.
(b) Each Holder who is identified as a selling security holder
in a filed Registration Statement will severally, and not jointly, indemnify and
hold harmless the Company, each other person referred to in subparts (1), (2)
and (3) of Section 11(a) of the Act in respect of the Registration Statement,
and each person, if any, who controls the Company or any such person within the
meaning of Section 15 of the Act, against any and all losses, claims, damages or
liabilities (including any reasonable investigation, legal and other expenses
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claim asserted), to which they, or any of them, may
become subject under the Act, the Exchange Act or other federal or state law or
regulation, at common law, or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of a material fact
contained in such Registration Statement, any related preliminary prospectus,
final prospectus or amendment thereof or
-12-
14
supplement thereto, or any related blue sky filing, or (ii) the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or omission was made in such Registration
Statement, preliminary prospectus, final prospectus or amendment thereof or
supplement thereto in reliance upon, and in conformity with, information
furnished in writing to the Company by such Holder specifically for use therein.
This indemnity will be in addition to any liability which a Holder may otherwise
have to the Company.
(c) Any party that proposes to assert the right to be
indemnified under this Section 12 shall, promptly after receipt of notice of the
commencement of any action, suit or proceeding against such party in respect of
which a claim is to be made against an indemnifying party or parties under this
Section, notify each such indemnifying party of the commencement thereof,
enclosing a copy of all papers served. No indemnification provided for in
Section 12(a) or 12(b) shall be available to any party who shall fail to give
notice as provided in this Section 12(c) if the party to whom notice was not
given was unaware of the proceeding to which such notice would have related and
was materially prejudiced by the failure to give such notice, but the omission
so to notify such indemnifying party of any such action, suit or proceeding
shall not relieve it from any liability that it may have to any indemnified
party otherwise than under this Section 12 or Section 13. In case any such
action, suit or proceeding is brought against any indemnified party and it
notifies the indemnifying party of the commencement thereof, such indemnifying
party will be entitled to participate in, and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, to assume the
defense thereof with counsel reasonably satisfactory to such indemnified party,
and, after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof and the approval by the indemnified
party of such counsel (which approval shall not unreasonably be withheld), the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses, except as provided below and except for the reasonable costs
of investigation subsequently incurred by such indemnified party in connection
with the defense thereof. The indemnified party shall have the right to employ
its own counsel in any such action, suit or proceeding but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i) the
employment of counsel by such indemnified party has been authorized in writing
by the indemnifying parties, (ii) the indemnified party shall have reasonably
concluded that there may be differing or additional defenses available to it and
not to one or more of the indemnifying parties in such action, suit or
proceeding (in which case the indemnifying parties shall not have the right to
direct the defense of such action, suit or proceeding on behalf of the
indemnified party), or (iii) the indemnifying parties shall not have employed
counsel to assume the defense of such action within a reasonable time after
notice of the commencement thereof, in each of which cases the fees and expenses
of the indemnified party's counsel shall be at the expense of the indemnifying
parties; however, the indemnifying party shall not, in connection with any one
such action, suit or proceeding or separate but substantially similar or related
actions, suits or proceedings in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys for the Holders and
controlling persons, which firm shall be designated in writing by a
-13-
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majority in interest of such Holders and controlling persons (based upon the
value of the Shares included in the Registration Statement). An indemnifying
party shall not be liable for any settlement of any action, suit, proceeding or
claim effected without its written consent.
Section 13. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in
Section 12 is due in accordance with its terms but for any reason is held to be
unavailable or insufficient to hold harmless an indemnified party, the Company
(including for this purpose any controlling person of the Company, any director
of the Company and any officer of the Company who signed the Registration
Statement) on the one hand, and the Holders (including for this purpose any
controlling persons thereof) on the other hand, shall, in lieu of indemnifying
such indemnified party, contribute to the aggregate losses, claims, damages or
liabilities referred to in Section 12 above (including any investigation, legal
and other expenses reasonably incurred in connection with, and any amount paid
in settlement of, any action, suit or proceeding or any claims asserted, but
after deducting any contribution received by or payable to the Company from
other persons other than the Holders, such as other selling securityholders,
persons who control the Company within the meaning of the Act, officers of the
Company who signed the Registration Statement, and directors of the Company),
(a) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Holders from the offering or offerings covered
by the Registration Statement or, (b) if the allocation provided by clause (a)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (a) above but
also the relative fault of the Company and the Holders in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and any Holder on
the other hand shall be deemed to be in the same proportion as (x) the total
proceeds (if any) received by the Company from the offering or offerings covered
by the Registration Statement (net of underwriting discounts but before
deducting expenses, if applicable), plus all cash proceeds received by the
Company from the exercise of the Warrants for the Shares of such Holder included
in the Registration Statement, bear to (y) the total proceeds received by such
Holder from the sale of Shares included in the Registration Statement. The
relative fault of the Company and any Holder shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or omission related to information supplied by the Company or such
Holder, and their relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
the Holders agree that it would not be just and equitable if contribution
pursuant to this Section 13 were determined by pro rata allocation (even if the
Holders were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above. Notwithstanding the provisions of this Section 13, in no case shall
any Holder (except as may be provided by agreement among them) be liable or
responsible for any amount in excess of the proceeds received by such Holder
from the sale of the Shares included in the Registration Statement; provided
that no person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes of
this Section 13,
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each person, if any, who controls a Holder within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act shall have the same rights to
contribution as such Holder, and each person, if any, who controls the Company
within the meaning of the Section 15 of the Act or Section 20(a) of the Exchange
Act, each director of the Company and each officer of the Company who shall have
signed the Registration Statement, shall have the same rights to contribution as
the Company, subject in each case to clauses (i) and (ii) in the immediately
preceding sentence of this Section 13. Any party entitled to contribution will,
promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against another party or parties under this Section 13, notify such
party or parties from whom contribution may be sought, and the omission so to
notify such party or parties from whom contribution may be sought shall relieve
the party or parties from whom contribution may be sought (if such party was
unaware of such action, suit or proceeding and was materially prejudiced by such
omission) from any liability under this Section 13, but not from any other
obligation it or they may have hereunder or otherwise than under this Section
13. No party shall be liable for contribution with respect to any settlement of
an action, suit, proceeding or claim effected without its written consent. The
obligations of the Holders to contribute pursuant to this Section 13 are several
in proportion to their respective number of Shares included in the Registration
Statement, and not joint.
Section 14. NOTICES. Any notice pursuant to this Agreement shall be in
writing and shall be deemed to have been duly given (i) if given by facsimile
transmission on the business day on which such transmission is sent and
confirmed, (ii) if given by air courier, two business days following the date it
was sent or (iii) if mailed by certified mail, return receipt requested, ten
business days following the date it was mailed, to the following addresses
(unless another address is herein specified):
(a) If to a Holder, addressed to: c/o Sunrise Financial Group,
Inc., 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xx. Xxxxxx Low (fax: 000-000-0000), with a copy to Xxxxxx,
Xxxxxxx & Xxxxxxx, 0 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxxx X. Xxxxxxxx, Esq. (fax: 000-000-0000).
(b) If to the Company, addressed to: 000 Xxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxx (fax:
000-000-0000) with a copy to: Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP, 000 Xxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxxx X. Xxxx, Esq.
(fax: 000-000-0000)
Each party may from time to time change the address or fax number to which
notices to it are to be delivered or mailed hereunder by notice in accordance
herewith to the other party.
Section 15. SUCCESSORS. All the covenants and provisions of this
Agreement by or for the benefit of the Company and the Holders shall bind and
inure to the benefit of their respective successors and assigns.
-15-
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Section 16. MERGER OR CONSOLIDATION OF THE COMPANY. The Company shall
not merge or consolidate with or into any other corporation or sell all or
substantially all of its property to another corporation, unless the provisions
of Section 8.4 are complied with.
Section 17. APPLICABLE LAW; SUBMISSION TO JURISDICTION. THIS AGREEMENT
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE COMMONWEALTH OF
MASSACHUSETTS AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF SAID SATE (WITHOUT REFERENCE TO ITS RULES AS TO CONFLICTS OF
LAWS). The parties hereby agree to the exclusive jurisdiction of the courts of
the Commonwealth of Massachusetts or the federal courts sitting in the
Commonwealth of Massachusetts in connection with any action arising out of this
Agreement.
Section 18. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall
be construed to give to any person or corporation other than the Company, the
Warrantholders and holders of Shares any legal or equitable right, remedy or
claim under this Agreement. This Agreement shall be for the sole and exclusive
benefit of the Company and the Holders.
Section 19. AMENDMENT AND WAIVER. This Agreement and the Warrants may
only be amended, or any term hereof waived, in writing by signed by the Company
and Warrantholders holding a majority of the Shares issued or issuable upon
exercise of the Warrants, whether or not an individual Warrantholder consents
thereto.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
-16-
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed, all as of the date and year first above written.
MATRITECH, INC.
By:_________________________________
Xxxxxxx Xxxxx
Chairman and Chief Executive Officer
WARRANTHOLDERS
____________________________________
Xxxxxx Low
____________________________________
Xxxxx Xxxxxxxx
____________________________________
Xxxxxx Xxxxxx
____________________________________
Xxxx Xxxxxxxxx
____________________________________
Xxxx Xxxxxxxxxxxx
____________________________________
Xxxxxxx Xxxxx
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Exhibit A
--------------------------- ---------------------------------
Warrantholder Number of Shares
--------------------------- ---------------------------------
Xxxxxx Low 200,000
Xxxxx Xxxxxxxx 200,000
Xxxxxx Xxxxxx 15,000
Xxxx Xxxxxxxxx 15,000
Xxxx Xxxxxxxxxxxx 15,000
Xxxxxxx Xxxxx 5,000
Total 450,000
A-1
20
Exhibit B
THE WARRANTS REPRESENTED BY THIS CERTIFICATE, AND THE
SECURITIES ISSUABLE UPON EXERCISE OF SUCH WARRANTS,
HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. SUCH WARRANTS AND
SECURITIES MAY NOT BE SOLD, ASSIGNED, EXCHANGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED IN ANY MANNER
EXCEPT IN COMPLIANCE WITH SECTION 11 OF THE INVESTOR
RELATIONS WARRANT AGREEMENT BY AND BETWEEN THE ISSUER
AND EACH OF THE ORIGINAL HOLDERS OF THE WARRANTS
DATED _______, 2000.
WARRANT CERTIFICATE NO. IRW-< CERT_NO >
MATRITECH, INC.
(ORGANIZED UNDER THE LAWS
OF THE STATE OF DELAWARE)
WARRANTS TO PURCHASE COMMON STOCK
This certifies that, for value received, < NAME >. (the
"Warrantholder") is the registered owner of < NUMBER > warrants (the "Warrants")
to purchase from Matritech, Inc. (the "Company"), at any time during the period
commencing at 9:00 a.m., Eastern Time, on _______, 2000 and ending at 5:00 p.m.,
Eastern Time, on ________, 2005, at an initial purchase price per share of $2.50
(the "Warrant Price"), one share of Common Stock of the Company. The Warrants
are subject to, and each Warrantholder, by acceptance of this certificate,
consents to all the terms and provisions of the Warrant Agreement dated as of
________, 2000, between the Company and the Warrantholder, pursuant to which the
Warrants evidenced hereby were issued (the "Warrant Agreement").
The Warrants evidenced hereby may be exercised in whole or in part by
presentation of this Warrant Certificate with the Purchase Form herein duly
executed (with a signature guarantee as provided therein), and simultaneous
payment of the Warrant Price for each Warrant exercised, at the principal office
of the Company. Payment of such price shall be made at the option of each
Warrantholder in cash or by certified or cashier's check, in next day funds.
Upon any partial exercise of the Warrants evidenced hereby, there shall
be signed and issued to the Warrantholder effecting such partial exercise a new
Warrant Certificate in respect of the Common Stock as to which the Warrants
evidenced hereby shall not have been exercised.
-B-1-
21
These Warrants may be exchanged at the office of the Company by surrender of
this Warrant Certificate properly endorsed for one or more new Warrants of the
same aggregate number of shares of Common Stock as here evidenced by the Warrant
or Warrants exchanged. No fractional shares of Common Stock will be issued upon
the exercise of rights to purchase hereunder, but the Company shall pay the cash
value of any fraction upon the exercise of one or more Warrants. These Warrants
are transferable at the office of the Company in the manner and subject to the
limitations set forth in the Warrant Agreement.
This Warrant Certificate does not entitle any Warrantholder to any of
the rights of a shareholder of the Company.
MATRITECH, INC.
By: _____________________________
Xxxxxxx Xxxxx
Chairman and Chief Executive Officer
ATTEST:
___________________________
Dated:________________, 2000
-B-2-
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PURCHASE FORM
Matritech, Inc.
000 Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Pursuant to paragraph 3(a) of the Warrant Agreement, the undersigned
hereby irrevocably elects to exercise the right of purchase represented by this
Warrant Certificate for, and to purchase thereunder, __________ shares of Common
Stock ("Common Stock") provided for therein, and requests that certificates for
such Common Stock be issued in the name of:
___________________________________
(Please Print or Type Name(s), Address and Taxpayer Identification Number(s))
___________________________________
___________________________________
___________________________________
If this Warrant Certificate is hereby being exercised with respect to fewer than
all the Common Stock specified herein, please issue a new Warrant Certificate
for the unexercised balance of the Warrants, registered in the name of the
undersigned Warrantholder or his assignee as below indicated and delivered to
the address stated below.
Dated: _______________________
Name of Warrantholder(s)
or Assignee(s) (Please Print): _____________________________
_____________________________
Address (Please Print): _________________________________________
_______________________________________________
Signature(s): _______________________________________________
_______________________________________________
Note: The above signature(s) must correspond exactly with the
name(s) as written upon the face of this Warrant Certificate, without
alteration or enlargement or any change whatever, unless these Warrants
have been assigned.
-B-3-
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ASSIGNMENT
(To be signed only upon assignment of Warrants)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
___________________________________
___________________________________
___________________________________
(Name(s) and Address(es) of Assignee(s) Must be Printed or Typewritten)
the within Warrants, hereby irrevocably constituting and appointing
________________________ the undersigned's attorney-in-fact to transfer said
Warrants on the books of the Company, with full power of substitution.
Dated: __________ ___________________________________
___________________________________
Signature(s) of Registered Holder(s)
Note: The above signature(s) must correspond exactly with the
name(s) as written upon the face of this Warrant Certificate, without
alteration or enlargement or any change whatever.
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