Exhibit 4
THIS WARRANT AND THE SHARES OF COMMON STOCK PURCHASABLE HEREUNDER HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS AND CANNOT BE OFFERED, SOLD, HYPOTHECATED,
TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF REGISTRATION OR
THE AVAILABILITY OF AN EXEMPTION FROM REGISTRATION UNDER SUCH LAWS AS
PROVIDED IN THIS WARRANT
No. of Shares: 500,000 Warrant No. A-1
Original Issue Date: February 23, 1998
WARRANT
To Purchase Shares of Common Stock of
LABONE, INC.
This certifies that, for value received, NATIONAL
SUPPORT SERVICES, INC. ("National Support"), is entitled to purchase
from LABONE, INC., a Delaware corporation, from time to time prior to
the Expiration Date in accordance with the terms and conditions hereof,
up to 500,000 shares of Common Stock of the Company at a Purchase Price
per share set forth below. The number of shares of Common Stock
purchasable hereunder and the Purchase Price therefor are subject to
adjustment as hereinafter set forth in Section 6.
1. Certain Definitions. For all purposes of this Warrant
the following terms shall have the meanings indicated:
(a) "Common Stock" shall mean the Company's presently
authorized shares of Common Stock, par value $0.01 per share, and any
other securities into which or for which the Common Stock may be
converted or exchanged pursuant to a plan of recapitalization,
reorganization, merger, sale of assets or otherwise.
(b) "Company" shall mean LABONE, INC., a Delaware
corporation, and any company which shall succeed to, or assume, the
obligations of said corporation hereunder.
(c) "Expiration Date" shall mean 12:01 o'clock a.m.
Central Daylight Time on March 1, 2003, which is twenty (20) calendar
quarters plus sixty (60) days after the date hereof.
(d) "Lab Revenues" shall mean all revenues received by
the Company during the applicable calendar quarter, pursuant to the
Marketing Agreement between the Company and National Support from and
after the date hereof.
(e) "Purchase Price" or "Purchase Price per share" shall
mean the purchase price per Warrant Share (as defined below), which
shall equal $17.00, being the closing sale price or, if no sales were
reported, then average of the closing bid and asked prices of the Common
Stock, as reported by the NASDAQ Stock Market, on the last business day
prior to the date of the Marketing Agreement, as such purchase price may
thereafter be adjusted from time to time pursuant to the provisions of
Section 6 hereof (rounded to the nearest whole cent).
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(f) "Warrantholder" or "Registered Holder" shall mean
National Support, or its registered transferee.
(g) "Warrant" shall mean this Warrant and all Warrants
issued in exchange therefor or replacement thereof.
(h) "Warrant Shares" shall mean the shares of Common
Stock purchasable by the Registered Holder upon the exercise of this
Warrant pursuant to Section 2 hereof, as adjusted from time to time
pursuant to Section 6 hereof.
All terms used in this Warrant which are not defined in Section
1 have the meanings respectively set forth therefor elsewhere in this
Warrant.
2. Exercise of Warrant.
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(a) Subject to the terms and conditions hereof, this
Warrant may be exercised only within sixty (60) days after the end of
each applicable calendar quarter and prior to the Expiration Date as
follows:
(i) for each calendar quarter in which the Lab Revenues
reach $500,000 and are less than $1,000,000, this Warrant may be
exercised in respect of 5,000 shares of Common Stock subject to this
Warrant;
(ii) for each calendar quarter in which the Lab Revenues
reach $1,000,000 and are less than $1,500,000, this Warrant may be
exercised in respect of 10,000 shares of Common Stock subject to this
Warrant;
(iii)for each calendar quarter in which the Lab Revenues
reach $1,500,000 and are less than $2,000,000, this Warrant may be
exercised in respect of 15,000 shares of Common Stock subject to this
Warrant;
(iv) for each calendar quarter in which the Lab Revenues
reach $2,000,000 and are less than $2,500,000, this Warrant may be
exercised in respect of 20,000 shares of Common Stock subject to this
Warrant; and
(v) for each calendar quarter in which the Lab Revenues
reach $2,500,000, this Warrant may be exercised in respect of 25,000
shares of Common Stock subject to this Warrant.
The foregoing rights to exercise shall be limited to one of the
categories set forth in 2(a)(i) - (v), above, as applicable each
calendar quarter. Anything in this Warrant to the contrary
notwithstanding, this Warrant may not be exercised at any time after a
breach by National Support of the Marketing Agreement between the
Company and National Support, unless and until such breach is cured
under the applicable provisions, if any, of such Marketing Agreement.
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(b) In order to exercise this Warrant in whole or in
part, the Registered Holder shall complete the "Notice of Intention to
Exercise Warrant" attached hereto (the "Notice Form"), and deliver this
Warrant, the completed Notice Form and either cash, a cashier's check
payable to the order of the Company or a wire transfer of funds in an
amount equal to the then aggregate Purchase Price of the Warrant Shares
being purchased, to the Corporate Secretary of the Company at the
Company's office located at 00000 Xxxx 00xx Xxxxxxx, Xxxxxx, Xxxxxx
00000 (or such other office or agency of the Company as the Company may
designate by notice in writing to the Registered Holder). In no event
may the Warrantholder exercise the Warrant with respect to more than
500,000 shares of Common Stock in the aggregate, subject to adjustment
as provided in this Warrant.
3. Delivery of Stock Certificate, Etc. Upon Exercise.
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As soon as practicable after exercise of this Warrant, the Company shall
cause to be issued and delivered to the Registered Holder (a) a
certificate or certificates representing the aggregate number of shares
of Common Stock specified in said Notice Form, all of which shares shall
be duly authorized and validly issued, fully paid and nonassessable, (b)
cash in lieu of any fractional share based upon the fair market value of
a share of Common Stock, as determined by the Company and (c) any other
securities or property (including cash) to which such Registered Holder
is entitled upon such exercise pursuant to the terms of this Warrant.
Each stock certificate representing shares of Common Stock so issued and
delivered shall be registered in the name of the Registered Holder or,
subject to the provisions of Sections 4 and 5 hereof, such other name as
shall be designated by the Registered Holder. Such certificate or
certificates shall be deemed to have been issued and the Warrantholder
or any other person so designated to be named therein shall be deemed to
have become a holder of record of such shares of Common Stock only as of
the date the certificate representing such shares is issued by the
Company.
4. Ownership and Transfer of Warrant and Warrant Shares.
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(a) Registered Holder. The Company may deem and treat
the Registered Holder of this Warrant as the holder and owner hereof
(notwithstanding any notations of ownership or writing hereon made by
anyone other than the Company) for all purposes, notwithstanding any
notice to the contrary, until presentation of this Warrant for
registration of transfer as provided in this Section 4.
(b) No Transfer. This Warrant may not be sold,
transferred, or assigned by the Registered Holder in whole or in part at
any time.
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5. Compliance with Securities Laws.
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(a) Investment Intent. By acceptance of this Warrant,
the Registered Holder represents and warrants that it is acquiring this
Warrant and any Warrant Shares for its own account and for the purpose
of investment and not with a view to the sale or distribution thereof.
The Registered Holder understands that this Warrant and the Warrant
Shares that may be issued upon exercise of this Warrant will not have
been registered under the Securities Act of 1933, as amended (the
"Securities Act") or any state securities laws (the Company being under
no obligation to effect such registration) and that this Warrant and the
Warrant Shares must be held indefinitely unless a subsequent disposition
thereof is registered under the Securities Act and applicable state
securities laws or is exempt from registration as provided herein.
(b) Limitation on Transfer. By acceptance of this
Warrant, the Registered Holder represents, covenants, and agrees that it
will not sell or otherwise dispose of this Warrant or of the Warrant
Shares in the absence of (i) registration under the Securities Act and
applicable state securities laws or (ii) an opinion acceptable in form
and substance to the Company from counsel reasonably satisfactory to the
Company, or an opinion of counsel to the Company, to the effect that no
registration is required for such disposition.
(c) Restrictive Legend. Each Warrant shall bear on the
face thereof a legend substantially in the form of the notice set forth
on the first page of this Warrant. Upon exercise of any part of the
Warrant and the issuance of any Warrant Shares, the Company shall
instruct its transfer agent to enter stop transfer orders with respect
to such Warrant Shares, and the certificates representing such Warrant
Shares shall have stamped or imprinted thereon or affixed thereto a
legend to the following effect:
The securities represented by this certificate have not been
registered under the Securities Act of 1933 or any state
securities laws and may not be sold, transferred or otherwise
disposed of in the absence of registration under such laws or
an opinion in form and substance acceptable to the Company
from counsel reasonably satisfactory to the Company to the
effect that no such registration is required.
6. Adjustments to the Purchase Price and Number of Warrant Shares.
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(a) Subdivision of Stock, etc. In the event of a stock
dividend or other distribution payable in Common Stock, or any stock
split or subdivision of Common Stock into a greater number of shares,
the number of Warrant Shares subject to the Warrant immediately prior to
such event shall be proportionately increased and the Purchase Price in
effect immediately prior to such event shall be proportionately reduced,
and in the event that the outstanding shares of Common Stock of the
Company shall be combined into a smaller number of shares, the number of
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Warrant Shares subject to the Warrant immediately prior to such
combination shall be proportionately reduced and the Purchase Price in
effect immediately prior to such combination shall be proportionately
increased.
(b) Reorganization, Consolidation, Merger, etc. In the
event that the Company shall (a) effect a reorganization or
recapitalization pursuant to which all of the outstanding shares of
Common Stock are converted into or exchanged for other securities or
property (including cash), (b) consolidate with or merge into any other
person, or (c) transfer all or substantially all of its properties or
assets to any other person in such a way that holders of Common Stock
shall be entitled to receive securities or property (including cash)
with respect to or in exchange for Common Stock; then, in each such
case, the Warrantholder, upon the exercise hereof as provided in Section
2 at any time after the consummation of such reorganization or
recapitalization, consolidation, merger or sale of assets, as the case
may be, shall be entitled to receive (and the Company shall be required
to deliver) in lieu of the Warrant Shares issuable upon such exercise
prior to such and other securities and property (including cash) to
which such holder would have been entitled upon such consummation, if
such Warrantholder had so exercised this Warrant immediately prior
thereto. The above provision shall apply to successive reorganizations,
recapitalizations, consolidations, mergers or transfers described
therein.
7. Notice of Record Date, Etc. In the event of
---------------------------
(a) any taking by the Company of a record of the holders
of Common Stock for the purpose of determining the holders thereof who
are entitled to receive any dividend (excluding any cash dividend
payable out of earnings or earned surplus of the Company), or any right
to subscribe for, purchase or otherwise acquire any shares of stock of
any class or any other securities or property, or to receive any other
right, or
(b) any transfer of all or substantially all of the
assets of the Company to or consolidation or merger of the Company with
or into any other person, or
(c) any voluntary or involuntary dissolution,
liquidation or winding-up of the Company,
then and in each event the Company shall cause to be mailed to the
Warrantholder a notice containing a brief description of the proposed
action and stating the date on which either a record is to be taken for
the purpose of such dividend, distribution or rights, or the date upon
which such transfer, consolidation, merger, dissolution, liquidation or
winding-up is to take place and the time, if any is to be fixed, as of
which the holders of Common Stock or other securities shall receive cash
or other property deliverable upon such transfer, consolidation, merger,
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dissolution, liquidation or winding-up. Such notice shall also state
that the action in question or the record date is subject to the
effectiveness of a registration statement under the Securities Act or a
favorable vote of stockholders, if either is required. Such notice
shall be mailed to the Warrantholder at least ten (10) days prior to the
date specified in such notice on which any such action is to be taken or
the record date, whichever is earlier.
8. Reservation of Warrant Shares.
------------------------------
During the term of this Warrant, the Company shall at all times reserve
and keep available from its authorized but unissued or treasury shares
such number of shares of its Common Stock as shall be issuable upon
exercise of the Warrant.
9. Notices.
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Any notice or other document required or permitted to be given or
delivered to the Registered Holder shall be delivered at, or sent by
certified or registered mail to the Registered Holder at the last
address shown on the books of the Company maintained for the registry
and transfer of the Warrants.
10. No Rights as Stockholder.
-------------------------
This Warrant shall not entitle the Registered Holder to any voting or
other rights as a stockholder of the Company.
11. Replacement of Warrant.
-----------------------
Upon receipt of evidence reasonably satisfactory to the Company of the
loss, theft, destruction or mutilation of this Warrant and, in the case
of such loss, theft or destruction, upon delivery of an indemnity bond
reasonably satisfactory in form and amount to the Company or, in the case
of any such mutilation, upon surrender and cancellation of such Warrant,
the Company at its expense will execute and deliver, in lieu thereof, a
new Warrant of like tenor.
12. Law Governing.
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This Warrant shall be governed by, and construed and enforced in
accordance with, the laws of the State of Delaware (excluding the choice
of law provisions thereof).
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13. Miscellaneous.
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This Warrant and any provision hereof may be changed, waived, discharged
or terminated only by an instrument in writing signed by the party (or
any predecessor in interest thereof) against which enforcement of the same
is sought. The headings in this Warrant are for purposes of reference only
and shall not affect the meaning or construction of any of the provisions
hereof.
IN WITNESS WHEREOF, this Warrant is executed effective
as of the day and year first above written.
LABONE, INC.
By:/s/ W. Xxxxxx Xxxxx XX
-------------------
Its Chairman of the Board,
President and Chief Executive
Officer
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NOTICE OF INTENTION TO EXERCISE WARRANT
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The undersigned hereby notifies LabOne, Inc. that he has elected
to exercise its right under the within Warrant to purchase
shares of Common Stock, and has effected a wire transfer to LabOne, Inc.
or enclosed herewith cash or a cashier's check payable to LabOne, Inc.
in the total amount of $ in payment of the Purchase Price for
such shares. The certificate(s) representing the shares of Common Stock
being purchased should be delivered in the denominations and to the
persons described below:
No. of
Name Address Shares
NATIONAL SUPPORT SERVICES, INC.
Date: By:
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(Signature)
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(Print Name)
-----------------------------
(Title)
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