31
NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF
THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND NEITHER
THIS WARRANT NOR SUCH SHARES MAY BE SOLD, ENCUMBERED OR OTHERWISE TRANSFERRED
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR AN
EXEMPTION FROM SUCH REGISTRATION REQUIREMENT, AND, IF AN EXEMPTION SHALL BE
APPLICABLE, THE HOLDER SHALL HAVE DELIVERED AN OPINION OF COUNSEL ACCEPTABLE TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
VOID AFTER 5:00 P.M. EASTERN STANDARD TIME, ON SEPTEMBER 6, 2001
WARRANT TO PURCHASE COMMON STOCK
OF
PALOMAR MEDICAL TECHNOLOGIES, INC.
FOR VALUE RECEIVED, PALOMAR TECHNOLOGIES, INC. (the "Company"), a
Delaware corporation, hereby certifies that Xxxxxx Xxxxx, or his permitted
assigns, is entitled to purchase from the Company, at any time or from time to
time commencing upon execution and prior to 5:00 P.M., Eastern Standard Time, on
September 6, 2001, a total of Eighty Two Thousand Five Hundred (82,500) fully
paid and nonassessable shares of the Common Stock, par value $.01 per share, of
the Company for an aggregate purchase price of Seven Hundred Thirty Two Thousand
One Hundred Eighty Seven and 50/100 Dollars ($732,187.50) (computed on the basis
of $8 7/8 per share). (Hereinafter, (i) said Common Stock, together with any
other equity securities which may be issued by the Company with respect thereto
or in substitution therefor, is referred to as the "Common Stock", (ii) the
shares of the Common Stock purchasable hereunder are referred to as the "Warrant
Shares", (iii) the aggregate purchase price payable hereunder for the Warrant
Shares is referred to as the "Aggregate Warrant Price", (iv) the price payable
hereunder for each of the Warrant Shares is referred to as the "Per Share
Warrant Price", (v) this Warrant, and all warrants hereafter issued in exchange
or substitution for this Warrant are referred to as the "Warrant" and (vi) the
holder of this Warrant is referred to as the "Holder"). The number of Warrant
Shares and the Per Share Warrant Price are subject to adjustment as provided in
this Warrant.
1. Exercise of Warrant. This Warrant may be exercised, in whole at any
time or in part from time to time, commencing upon execution, and prior to 5:00
P.M., Eastern Standard Time then current, on September 6, 2001, by the Holder of
this Warrant by the surrender of this Warrant (with the subscription form at the
end hereof duly executed) at the address set forth in Subsection 17(a) hereof,
together with proper payment of the Aggregate Warrant Price, or the
proportionate part thereof if this Warrant is exercised in part. Payment for
Warrant Shares shall be made by certified or official bank check payable to the
order of the Company or wire transfer of funds to the account of the Company,
except as provided in Section 2 hereof. If this Warrant is exercised in part,
this Warrant must be exercised for a minimum of 1,000 shares of the Common Stock
(or such lesser number of shares of Common Stock as shall remain available for
purchase under the terms of the Warrant), subject to adjustment as provided in
this Warrant, and the Holder is entitled to receive a new Warrant covering the
number of Warrant Shares in respect of which this Warrant has not been exercised
and setting forth the proportionate part of the Aggregate Warrant Price
applicable to such Warrant Shares. Upon such surrender of this Warrant, the
Company will at its expense within three business days after receipt of such
Warrant (a) issue in the name of and deliver to the Holder, or as the Holder may
direct, a certificate or certificates in such denominations as may be requested
by such Holder, for the largest number of whole shares of the Common Stock to
which the Holder shall be entitled, and (b) deliver to the Holder a new Warrant
containing the same terms and provisions and covering the number of Warrant
Shares in respect of which this Warrant has not been exercised, if this Warrant
has not been exercised in full. In lieu of any fractional share of the Common
Stock which would otherwise be issuable in respect to the exercise of the
Warrant, the Company at its option (i) may pay to the Holder in cash an amount
equal to the fair market value of the fractional share based upon the fair
market value of a share of Common Stock as determined under Section 2 hereof or
(ii) may issue to the Holder an additional share of Common Stock.
32
The person in whose name any certificate for shares of Common Stock is
to be issued upon exercise of this Warrant shall for all purposes be deemed to
have become a shareholder of record of the Company in respect of such shares on
the date this Warrant (with the subscription form at the end hereof duly
executed) was surrendered and payment of the applicable Per Share Warrant Price
was made as provided herein.
No warrant granted herein shall be exercisable after 5:00 p.m. Eastern
Standard Time on September 6, 2001.
2. Net Issuance.
a. In lieu of payment of the Per Share Warrant Price as
provided in Section 1 hereof, the Holder may pay the Per Share Warrant Price by
giving the Company written notice of the Holder's delivery of irrevocable
instructions to a broker-dealer to sell or margin a sufficient portion of the
Warrant Shares to pay the Per Share Warrant Price and any withholding taxes and
to deliver such sale or margin loan proceeds directly to the Company (the
"Cashless Exercise Procedure"). The Company agrees that upon receipt of such
notice, (i) the Company will immediately deliver to the broker-dealer written
confirmation that the Company will deliver certificates representing such
Warrant Shares to the broker-dealer promptly in exchange for such proceeds, (ii)
the Company will promptly deliver such certificates to the broker-dealer in
exchange for such proceeds upon request of the broker-dealer and (iii) the
Company will cooperate in a prompt and expeditious manner with all procedures of
such broker-dealer to permit participation by the Holder in such broker-dealer's
exercise or financing program and to permit the broker-dealer to sell such
Warrant Shares simultaneously with the exercise of the Warrant. The Holder will
direct the broker-dealer to deliver such proceeds to the Company within five
business days of delivery of the exercise notice to the Company. The Company
agrees to treat the gross proceeds received by the broker-dealer upon the
exercise of the Warrant Shares as the gross amount received by the Holder for
purposes of determining the taxable amount paid to the Holder under applicable
federal, state and local tax laws. Only in the event that (x) use by the Holder
of the Cashless Exercise Procedure in the manner described above would be
prohibited by, result in a violation of, or result in liability of the Holder or
broker-dealer under any statute or law or any regulation, rule, ordinance, or
interpretive ruling, determination or opinion of any governmental agency or
authority or (y) the Company fails to comply with this Section 2(a); then the
Holder may pay the Per Share Warrant Price in the manner provided in Section
2(b) hereof.
b. To the extent permitted under subsection (a) hereof, in
lieu of payment of the Per Share Warrant Price as provided in Section 1 hereof,
the Holder may elect in the subscription form attached hereto to pay the Per
Share Warrant Price in whole or in part by receiving shares of Common Stock
equal to the net issuance value (as determined below) of this Warrant or any
part hereof, upon exercise of this Warrant or any part hereof, in which event
the Company shall issue to the Holder a number of shares of Common Stock
computed using the following formula:
X = Y x (A-B)
A
Where: X = the number of shares of Common Stock to be issued to the Holder
Y = the number of shares of Common Stock as to which this Warrant is
exercised
A = the current fair market value of one share of Common Stock
calculated as of the last trading day immediately preceding the
exercise of this Warrant
B = the Per Share Warrant Price
As used herein, current fair market value of Common Stock as of a specified date
shall mean with respect to each share of Common Stock the average of the closing
prices of the Common Stock on the principal securities market on which the
Common Stock may at the time be traded over a period of five Business Days
consisting of the day as of which the current fair market value of a share of
Common Stock is being determined (or if such day is not a
33
Business Day, the Business Day next preceding such day) and the four consecutive
Business Days prior to such day. If on the date for which current fair market
value is to be determined the Common Stock is not eligible for trading on any
securities market, the current fair market value of Common Stock shall be the
highest price per share which the Company could then obtain from a willing buyer
(not a current employee or director) for shares of Common Stock sold by the
Company, from authorized but unissued shares, as determined in good faith by the
Board of Directors of the Company, unless within 30 days prior to such date the
Company has become subject to a merger, acquisition or other consolidation
pursuant to which the Company is not the surviving party, in which case the
current fair market value of the Common Stock shall be deemed to be the value
received by the holders of the Company's Common Stock for each share thereof
pursuant to the transaction. "Business Day" as used herein shall mean a day on
which the New York Stock Exchange is open for business.
c. In the event that the Holder pays the Per Share Warrant
Price in the manner provided in Sections 1 or 2(b) hereof, the Holder may
satisfy any federal, state or local tax withholding requirements in whole or in
part by electing in the exercise form to have the Company withhold Warrant
Shares having a value equal to the amount required to be withheld. The value of
each Warrant Share to be withheld shall be the fair market value of such Warrant
Share as determined under subsection (b) hereof.
3. Adjustment for Dividends in Other Stock, Property, etc.;
Reclassification, etc.. In case at any time or from time to time, all the
holders of the Common Stock shall have received, or (on or after the record date
fixed for the determination of stockholders eligible to receive) shall have
become entitled to receive, without payment therefor,
a. other or additional stock or other securities or
property (other than cash) by way of dividend, or
b. any cash (excluding cash dividends payable solely out of
earnings or earned surplus of the Company), or
c. other or additional stock or other securities or
property (including cash) by way of spin-off, split-up,
reclassification, recapitalization, combination or
exchange of shares or similar corporate rearrangement,
other than additional shares or distributions
adjustments in respect of which are provided for in
Section 5, then and in each such case the Holder of this
Warrant on the exercise hereof shall also be entitled to
receive the amount of stock and other securities and
property (including cash in the cases referred to in
subdivisions (b) and (c) of this Section 3) which such
Holder would hold on the date of such exercise if on the
date hereof the Holder had been the holder of record of
the number of shares of Common Stock called for on the
face of this Warrant, or such portion thereof with
respect to which the Warrant is being exercised, and had
thereafter, during the period from the date hereof to
and including the date of such exercise, retained such
shares and all such other or additional stock and other
securities and property (including cash in the case
referred to in subdivisions (b) and (c) of this Section
3) receivable by the Holder as aforesaid during such
period. The Company shall make appropriate provision
with respect to the rights and interests of the Holder
to the end that the provisions of this Warrant shall
thereafter be applicable, as nearly as may be, in
relation to such stock, securities or property
thereafter deliverable upon the exercise of such
exercise rights.
4. Consolidations and Mergers. In case of any consolidation or
merger of the Company with any other corporation, or in case of
any sale or transfer of all or substantially all of the assets
of the Company, or in the case of any share exchange pursuant to
which all of the outstanding shares of Common Stock are
converted into or exchanged for other securities or property
(including cash), the Company shall make appropriate provision
or cause appropriate provision to be made so that each Holder
shall have the right thereafter to obtain upon exercise of the
Warrant the kind and amount of shares of stock and other
securities and property receivable upon such consolidation,
merger, sale, transfer or share exchange by a holder of the
number of shares of Common Stock for which the Warrant may be
exercised prior to the effective date of such consolidation,
merger, sale, transfer or share exchange. If, in connection with
any such consolidation, merger, sale, transfer, or share
exchange, each holder of shares of Common Stock is entitled to
elect to receive either securities, cash, or other assets upon
completion of such transaction, the Company shall provide or
cause to be provided to each Holder the right to elect the
securities,
34
cash, or other assets for which the Warrant may be exercised by
such Holder subject to the same conditions applicable to holders
of the Common Stock (including, without limitation, notice of
the right to elect, limitations on the period in which such
election shall be made, and the effect of failing to exercise
the election). The Company shall not effect any such transaction
unless the provisions of this paragraph have been complied with
and the Company shall have made appropriate provision with
respect to the rights and interests of the Holder to the end
that the provisions of this Warrant shall thereafter be
applicable, as nearly as may be, in relation to such securities,
assets, cash or property receivable upon such consolidation,
merger, sale, transfer, or share exchange. The Company will not
effect any such consolidation, merger, sale, transfer or share
exchange unless prior to the consummation thereof the successor
corporation (if other than the Company) resulting from such
consolidation or merger or the corporation purchasing such
assets shall assume, by written instrument executed and mailed
or delivered to the Holder of this Warrant at the last address
of such Holder appearing on the books of the Company, the
obligation to deliver to such holder such securities assets,
cash or property as, in accordance with the foregoing
provisions, such Holder may be entitled to receive.
5. Adjustment for Extraordinary Events. In the event that the
Company shall (i) issue additional shares of the Common Stock as
a dividend or other distribution on outstanding Common Stock,
(ii) subdivide or reclassify its outstanding shares of Common
Stock, or (iii) combine its outstanding shares of Common Stock
into a smaller number of shares of Common Stock, then, in each
such event, the Per Share Warrant Price shall, simultaneously
with the happening of such event, be adjusted by multiplying the
then Per Share Warrant Price by a fraction, the numerator of
which shall be the number of shares of Common Stock outstanding
immediately prior to such event and the denominator of which
shall be the number of shares of Common Stock outstanding
immediately after such event, and the product so obtained shall
thereafter be the Per Share Warrant Price then in effect. In
addition, the number of Warrant Shares subject to the Warrant
shall, simultaneously with the happening of such event, be
adjusted by multiplying the number of Warrant Shares by a
fraction, the numerator of which shall be the number of shares
of Common Stock outstanding immediately after such event and the
denominator of which shall be the number of shares of Common
Stock outstanding immediately prior to such event, and the
product so obtained shall thereafter be the number of Warrant
Shares then subject to the Warrant. The Per Share Warrant Price
and the number of Warrant Shares, as so adjusted, shall be
readjusted in the same manner upon the happening of any
successive event or events described herein in this Section 5.
6. Notices of Record Date, etc. In the event of
a. any taking by the Company of a record of the holders of
any class of securities for the purpose of determining
the holders thereof who are entitled to receive any
dividend on, 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 capital reorganization of the Company, any
reclassification or recapitalization of the capital
stock of the Company or 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 will give or cause to be
given to the Holder, at least ten days prior to such record
date, a written notice specifying (i) the date on which any such
record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of
such dividend, distribution or right, (ii) the date on which any
such reorganization, reclassification, recapitalization,
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 record of Common Stock shall
be entitled to exchange their shares of Common Stock for
securities or other property deliverable on such reorganization,
reclassification, recapitalization, transfer, consolidation,
merger, dissolution, liquidation or winding-up, and (iii) the
amount and character of any stock or other securities, or rights
or options with respect thereto, proposed to be issued or
granted, the date of such proposed issue or grant and the
persons or class of persons to whom such proposed issue or grant
is to be offered or made. 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
35
Act of 1933, as amended (the "Securities Act"), or a favorable
vote of stockholders if either is required. Such notice shall be
given at least ten 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.
7. Jurisdiction. The Company irrevocably and unconditionally (i)
agrees that any action, suit or legal proceeding arising out of
or relating to this Warrant shall be brought in the United
States District Court for the District of Kansas or the District
Court of Xxxxxxx County, Kansas, unless the court will not
accept such jurisdiction, and except for cross-claims in the
event of suit by a third party, (ii) consents to the
jurisdiction of such courts (and of appropriate appellate
courts) in any such action, suit or proceeding, (iii) waives any
objection which the Company may have to the laying of venue of
any such action, suit or proceeding in any such court and (iv)
waives any claim that any such court is not a convenient forum
for any such action, suit or proceeding. If the action is
brought in the District Court of Xxxxxxx County, Kansas, nothing
herein shall prevent either party from attempting to remove the
action to the United States District Court for the District of
Kansas in accordance with applicable law.
8. Notice of Adjustment. Upon any adjustment of the Per Share
Warrant Price or the number or type of Warrant Shares, then and
in each such case the Company shall give written notice thereof
to the Holder as provided in Section 17 hereof, which notice
shall state the Per Share Warrant Price and number and type of
Warrant Shares resulting from such adjustment, setting forth in
reasonable detail the method of calculation and the facts upon
which such calculation is based.
9. Reservation of Warrant Shares. The Company agrees that, prior to
the expiration of this Warrant, the Company will at all times
have authorized and in reserve, and will keep available, solely
for issuance or delivery upon the exercise of this Warrant, the
shares of the Common Stock as from time to time shall be
receivable upon the exercise of this Warrant.
10. Fully Paid Stock; Taxes. The Company agrees that the shares of
the Common Stock represented by each and every certificate for
Warrant Shares delivered on the exercise of this Warrant shall,
at the time of such delivery, be validly issued and outstanding,
fully paid and non-assessable, and not subject to preemptive
rights, and the Company will take all such actions as may be
necessary to assure that the par value or stated value, if any,
per share of the Common Stock is at all times equal to or less
than the then Per Share Warrant Price. The Company further
covenants and agrees that it will pay, when due and payable, any
and all Federal and State stamp, original issue or similar taxes
that may be payable in respect of the issue of any Warrant Share
or certificate therefor.
11. Transfer.
a. Securities Laws. Neither this Warrant nor the Warrant
Shares issuable upon the exercise hereof have been
registered under the Securities Act or under any state
securities laws and unless so registered may not be
transferred, sold, pledged, hypothecated or otherwise
disposed of unless an exemption from such registration
is available. In the event Holder desires to transfer
this Warrant or any of the Warrant Shares issued, the
Holder must give the Company prior written notice of
such proposed transfer including the name and address of
the proposed transferee. Such transfer may be made only
either (i) upon publication by the Securities and
Exchange Commission (the "Commission") of a ruling,
interpretation, opinion or "no action letter" based upon
facts presented to said Commission, or (ii) upon receipt
by the Company of an opinion of Counsel to the Company
or counsel reasonably acceptable to the Company in
either case to the effect that the proposed transfer
will not violate the provisions of the Securities Act,
the Securities Exchange Act of 1934, as amended
("Exchange Act"), or the rules and regulations
promulgated under either such act, or to the effect that
the Warrant or Warrant Shares to be sold or transferred
has been registered under the Securities Act, and that
there is in effect a current prospectus meeting the
requirements of Subsection 10(a) of the Securities Act,
which is being or will be delivered to the purchaser or
transferee at or prior to the time of delivery of the
certificates evidencing the Warrant or Warrant Shares to
be sold or transferred.
b. Conditions to Transfer. Prior to any such proposed
transfer, and as condition thereto, if such transfer is
not made pursuant to an effective registration statement
under the Securities Act, the Holder will, if
36
requested by the Company, deliver to the Company, to the
extent required to qualify for the exemption from
registration relied upon by the Holder, (i) an
investment covenant signed by the proposed transferee,
(ii) an agreement by such transferee to the impression
of the restrictive investment legend set forth herein on
the certificate or certificates representing the
securities acquired by such transferee, (iii) an
agreement by such transferee that the Company may place
a "stop transfer order" with its transfer agent or
registrar, and (iv) an agreement by the transferee to
indemnify the Company to the same extent as set forth in
the next succeeding paragraph.
c. Indemnity. The Holder acknowledges that the Holder
understands the meaning and legal consequences of this
Section 11, and the Holder hereby agrees to indemnify
and hold harmless the Company, its representatives and
each officer and director thereof from and against any
and all loss, damage or liability (including all
attorneys' fees and costs incurred in enforcing this
indemnity provision) due to or arising out of (a) the
inaccuracy of any representation or the breach of any
warranty of the Holder contained in, or any other breach
of this Section 11, (b) any transfer of the Warrant or
any of the Warrant Shares in violation of the Securities
Act, the Exchange Act, or the rules and regulations
promulgated under either of such acts, (c) any transfer
of the Warrant or any of the Warrant Shares not in
accordance with this Warrant or (d) any untrue statement
or omission to state any material fact in connection
with the investment representations or with respect to
the facts and representations supplied by the Holder to
counsel to the Company upon which its opinion as to a
proposed transfer shall have been based.
d. Transfer. Except as restricted hereby, this Warrant and
the Warrant Shares issued may be transferred by the
Holder in whole or in part at any time or from time to
time. Upon surrender of this Warrant to the Company or
at the office of its stock transfer agent, if any, with
assignment documentation duly executed and funds
sufficient to pay any transfer tax, and upon compliance
with the foregoing provisions, the Company shall,
without charge, execute and deliver a new Warrant in the
name of the assignee named in such instrument of
assignment, and this Warrant shall promptly be canceled.
Any assignment, transfer, pledge, hypothecation or other
disposition of this Warrant attempted contrary to the
provisions of this Warrant, or any levy of execution,
attachment or other process attempted upon the Warrant,
shall be null and void and without effect.
e. Legend and Stop Transfer Orders. Unless the Warrant
Shares have been registered under the Securities Act,
upon exercise of any part of the Warrant and the
issuance of any of Warrant Shares, the Company shall
instruct its transfer agent to enter stop transfer
orders with respect to such shares, and all certificates
representing Warrant Shares shall bear on the face
thereof substantially the following legend, insofar as
is consistent with Delaware law:
"The shares of common stock represented by this
certificate have not been registered under the
Securities Act of 1933, as amended, and may not be sold,
offered for sale, assigned, transferred or otherwise
disposed of unless registered pursuant to the provisions
of that Act or an opinion of counsel reasonably
acceptable to the Company is obtained stating that such
disposition is in compliance with an available exemption
from such registration."
12. Registrations.
a. On the earlier to occur of (i) the next filing by the
Company of a registration statement on Form S-3
providing for the resale of its securities by security
holders of the Company or (ii) August , 1997 and, in any
event, subject to the receipt of necessary information
from the Holder, the Company shall file with the
Securities and Exchange Commission (the "Commission") a
registration statement on Form S-3 or other appropriate
form (the "Registration Statement"), which may include
other selling stockholders, providing for the resale of
the Warrant Shares (the "Registrable Shares") by the
Holder from time to time in accordance with Rule 415
promulgated under the Securities Act, or any similar
rule that may be adopted by the Commission. The Company
shall use its best efforts to cause the Registration
Statement to become effective by October , 1997 and the
Company shall use its best efforts to keep the
Registration Statement effective until the earlier of
(a) the time all the Registrable Shares have been sold
pursuant to the Registration Statement or (b) 60 days
after the expiration date of the Warrant. The Company
shall promptly furnish to the Holder such number of
copies of the Registration
37
Statement and any amendment thereto and of the
prospectus included therein and any supplement thereto
as the Holder shall reasonably require to facilitate the
public sale of the Registrable Shares.
b. The Company shall promptly prepare and file with the
Commission such amendments and post-effective amendments
to the Registration Statement as may be necessary to
keep such Registration Statement effective during the
entire applicable period and in compliance with the
provisions of subsection (e) below; and cause each
prospectus to be supplemented, and as so supplemented to
be filed (if required) with the Commission pursuant to
Rule 424 of the General Rules and Regulations
promulgated under the Securities Act.
c. The Company shall use its best efforts to register or
qualify the Registrable Securities under all applicable
state securities or "blue sky" laws of such
jurisdictions in the United States as may be from time
to time reasonably requested by any holder of the
Warrant or Warrant Shares; provided, however, that the
Company shall not be required to (i) qualify as a
foreign corporation in any jurisdiction where it would
not be otherwise required to so qualify, (ii) take any
action that would subject it to general service of
process or taxation in any jurisdiction if it is not
then so subject, (iii) provide any undertakings that
cause more than nominal expense or burden to the
Company, or (iv) make any change in its charter or
by-laws, which in each case the Board of Directors of
the Company determines to be contrary to the best
interests of the Company and its shareholders.
d. The Company shall promptly notify each holder of the
Warrant or Warrant Shares (i) when the Registration
Statement has been declared effective and when any
post-effective amendments thereto have been declared
effective by the Commission, (ii) of any request by the
Commission or any state securities authority for
post-effective amendments and/or supplements to the
Registration Statement, (iii) of the issuance by the
Commission or any state securities authority of any stop
order suspending the effectiveness of the Registration
Statement and (iv) the happening of any event as a
result of which the prospectus contained in the
Registration Statement or any supplement to such
prospectus is not in compliance with subsection (e)(iii)
hereof.
e. The Company shall use its best efforts to assure that
(i) the Registration Statement and any amendment
thereto, and any prospectus forming a part thereof and
any supplement thereto, complies in all material
respects with the Securities Act and the rules and
regulations thereunder, (ii) the Registration Statement
and any amendment thereto does not at any time during
the applicable period contain an untrue statement of a
material fact or omit to state a material fact required
to be stated therein or necessary to make the statements
therein not misleading, and (iii) the prospectus forming
part of the Registration Statement and any supplement to
such prospectus (as amended or supplemented from time to
time) does not at any time during the applicable period
include an untrue statement or a material fact or omit
to state a material fact necessary to make the
statements therein, in light of the circumstances under
which they were made, not misleading.
f. The Company shall be responsible for, and shall pay in
due course, any and all expenses incident to the
performance by the Company of its obligations under this
Warrant, including, but not limited to: (i) all
Commission and NASD registration and filing fees; (ii)
all fees and expenses incurred in connection with
compliance with state securities or blue sky laws; (iii)
all expenses of printing and distributing the
Registration Statement, any prospectus, and any
amendments or supplements thereto; and (iv) the fees and
disbursements of counsel for the Company and of the
independent pubic accountants of the Company.
g. The Company hereby agrees to indemnify and hold harmless
each Holder, its partners, officers, directors and
representatives, and each Person, if any, who controls
such Holder within the meaning of the Securities Act or
the Exchange Act, against any and all losses,
liabilities, claims, damages, costs and expenses
whatsoever, as incurred (including all attorneys' fees
and costs incurred in enforcing this indemnity
provision), arising out of any breach by the Company of
any representation, warranty or covenant in this
Warrant, any untrue statement or alleged untrue
statement of a material fact contained in the
Registration Statement or the omission or alleged
omission therefrom of a material fact required to be
stated therein or necessary to make the statements
therein not misleading, or arising out of any untrue
statement or alleged untrue statement of a material fact
contained in any prospectus or the omission or alleged
omission therefrom of a material fact necessary in order
to make the statements therein, in light of the
circumstances under which they were made, not
misleading. Notwithstanding anything to the contrary
contained herein, the indemnification described above
shall not apply to
38
amounts paid in settlement of any loss, liability,
claim, damage, cost or expense if such settlement is
effected without the prior written consent of the
Company, which consent shall not be unreasonably
withheld. Notwithstanding anything to the contrary
contained herein, the indemnification agreement
contained in this subsection (g): (i) shall not apply to
a claim arising out of or based upon a violation which
occurs in reliance upon and in conformity with
information furnished in writing to the Company by such
Holder or underwriter for such Holder expressly for use
in connection with the preparation of the Registration
Statement or any such amendment thereof or supplement
thereto, if such prospectus was timely made available by
the Company to the Holder for review and approval and
(ii) with respect to any preliminary prospectus shall
not inure to the benefit of any such person from whom
the person asserting any such claim purchased the
Registrable Securities that are the subject thereof (or
to the benefit of any person controlling such person) if
the untrue statement or omission of material fact
contained in the preliminary prospectus was corrected in
the prospectus, as then amended or supplemented, if such
prospectus was timely made available by the Company
pursuant to Section 12(a) hereof.
h. As long as the Company is subject to the reporting
requirements of Section 13 or Section 15 of the Exchange
Act, the Company shall promptly file the reports
required to be filed by it pursuant to Section 13(a) or
15(d) of the Exchange Act and the rules and regulations
adopted by the Commission thereunder. If the Company is
at any time not required to file such reports, it shall
promptly make publicly available such information as is
necessary to permit sales of its Common Stock pursuant
to Rule 144 of the General Rules and Regulations
promulgated under the Securities Act.
i. If at any time the Company shall determine to register
any of its securities under the Securities Act, other
than on Form S-8 or Form S-4 or their then equivalents
or as provided in subsection (a) hereof, it shall send
to each Holder of the Registrable Shares, including each
Holder who has the right to acquire Registrable Shares,
written notice of such determination and, if within 10
days after receipt of such notice, such Holder shall so
request in writing, the Company shall use its best
efforts to include in such registration statement all or
any part of the Registrable Shares such Holder requests
to be registered therein, except that if, in connection
with any offering involving an underwriting of Common
Stock to be issued by the Company, the managing
underwriter shall impose a limitation on the number of
shares of such Common Stock which may be included in any
such registration statement because, in its judgment,
such limitation is necessary to effect an orderly public
distribution, and such limitation is imposed pro rata
with respect to all securities whose holders have a
contractual, incidental ("piggy-back") right to include
such securities in the registration statement and as to
which inclusion has been requested pursuant to such
right, then the Company shall be obligated to include in
such registration statement only such limited portion
(which may be none) of the Registrable Shares with
respect to which such Xxxxxx has requested inclusion
hereunder.
13. Loss, etc. of Warrant. Upon receipt of evidence satisfactory to
the Company of the loss, theft, destruction or mutilation of
this Warrant, and of indemnity reasonably satisfactory to the
Company, if lost, stolen or destroyed, and upon surrender and
cancellation of the Warrant, if mutilated, the Company shall
execute and deliver to the Holder a new Warrant of like date,
tenor and denomination.
14. Warrant Holder Not Shareholder. Except as otherwise provided
herein, this Warrant does not confer upon the Holder any right
to vote or to consent to or receive notice as a shareholder of
the Company, as such, in respect of any matters whatsoever, or
any other rights or any liabilities for the Aggregate Warrant
Price or as a shareholder, prior to the exercise hereof, whether
such liabilities are asserted by the Company or a creditor of
the Company.
15. Remedies. The Company stipulates that the remedies at law of the
Holder of this Warrant in the event of any default or threatened
default by the Company in the performance of or compliance with
any of the terms of this Warrant are not and will not be
adequate, and that such terms may be specifically enforced by
decree for the specific performance of any agreement contained
herein or by an injunction against a violation of any of the
terms hereof or otherwise. Nothing in this Section shall be
construed as prohibiting any Holder from pursuing any other
rights or remedies available for any such default.
39
16. No Impairment. The Company will not, by amendment of its
Certificate of Incorporation or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek
to avoid the observance or performance of any of the terms to be
observed or performed hereunder by the Company, but will at all
times in good faith assist in the carrying out of all provisions
of this Warrant and in the taking of all such action as may be
necessary or appropriate in order to protect the exercise rights
of the Holders of the Warrant against impairment.
17. Communication. No notice or other communication under this
Warrant shall be effective unless the same is in writing and (i)
delivered personally, (ii) sent by express mail service that
provides for confirmation of delivery or (iii) is mailed by
first-class mail, postage prepaid, to:
a. the Company at 00 Xxxxxx Xxxx Xxxxx, Xxxxxxx,
Xxxxxxxxxxxxx 00000, or such other address as the
Company has designated in writing to the Holder, or
b. the Holder at 0000 Xxxx 00xx Xxxxxx, Xxxxxxx Xxxxxxx, XX
00000 or such other address as the Holder has designated
in writing to the Company and a copy to Xxxxxxxx X.
Xxxxx, Hillix, Brewer, Hoffhaus, Whittaker & Xxxxxx,
L.L.C., 0000 Xxxxxxxx Xxxx, Xxx. 000, Xxxxxx Xxxx, XX
00000.
18. Headings. The headings of this Warrant have been inserted as a
matter of convenience and shall not affect the construction
hereof.
19. Applicable Law. This Warrant shall be governed by and construed
in accordance with the law of the State of Delaware without
giving effect to the principles of conflicts of law thereof.
20. Miscellaneous. This Warrant shall inure to the benefit of and be
binding upon the heirs, successors and assigns of the Holder.
This Warrant and any terms hereof may be changed, waived,
discharged or terminated only by an instrument in writing signed
by the party against whom enforcement of such change, waiver,
discharge or termination is sought. The invalidity or
unenforceability of any provision hereof shall in no way affect
the validity or enforceability of any other provision.
IN WITNESS WHEREOF, PALOMAR MEDICAL TECHNOLOGIES, INC. has
caused this Warrant to be signed by its Chairman and its corporate seal
to be hereunto affixed and attested by its Secretary this _____ day of
____________________, 1996.
PALOMAR TECHNOLOGIES, INC.
By:______________________________
Xxxxxx Xxxxxxxx, Chairman
(Corporate Seal)
40
SUBSCRIPTION
1. The undersigned, _________________________________, pursuant to
the provisions of the foregoing Warrant, hereby agrees to
subscribe for the purchase of _______ shares of the Common Stock
of PALOMAR MEDICAL TECHNOLOGIES, INC. covered by said Warrant,
and makes payment therefor in full at the price per share
provided by said Warrant.
2. The undersigned Holder (check one):
___ a. elects to pay the aggregate purchase price for such
shares of Common Stock (i) by lawful money of the United
States or the enclosed certified or official bank check
payable in United States dollars to the order of the
Company in the amount of $______________, or (ii) by
wire transfer of United States funds to the account of
the Company in the amount of $___________, which
transfer has been made before or simultaneously with the
delivery of this Form of Subscription pursuant to the
instructions of the Company; or
___ b. elects to pay the aggregate purchase price by
implementing the Cashless Exercise Procedure pursuant to
Section 2(a) of the Warrant.
___ c. elects to receive shares of Common Stock having a
value equal to the value of the portion of the Warrant
exercised, calculated in accordance with Section 2(b) of
the Warrant (available only to the extent provided in
Section 2(b) of the Warrant).
3. ___ (Check if applicable) The undersigned Holder elects to have
the Company withhold Warrant Shares having a value equal to the
amount required to be withheld to satisfy any federal, state or
local tax withholding requirements (available only to the extent
provided in Section 2(c) of the Warrant).
4. Please issue a stock certificate or certificates representing
the appropriate number of shares of Common Stock in the name of
the undersigned or in such other name(s) as is specified below:
Name:
Address:
Dated:_______________________ Signature:___________________________
Address:___________________________
Soc. Sec. # or Fed. ID#:___________________________
41
ASSIGNMENT
FOR VALUE RECEIVED ____________________________ hereby sells, assigns
and transfer unto ______________________ the foregoing Warrant and all rights
evidenced thereby, and does irrevocably constitute and appoint
________________________, attorney, to transfer said Warrant on the books of
PALOMAR MEDICAL TECHNOLOGIES, INC.
Signature:____________________ Assignee
Dated:________________________
Address:______________________ Address:______________________
SS/Fed ID#:___________________ SS/Fed ID#:___________________
PARTIAL ASSIGNMENT
FOR VALUE RECEIVED ____________________________ hereby sells, assigns
and transfer unto ______________________ the right to purchase _____ shares of
the Common Stock of PALOMAR MEDICAL TECHNOLOGIES, INC. by the foregoing Warrant,
and a proportionate part of said Warrant and the rights evidenced thereby, and
does irrevocably constitute and appoint ________________________, attorney, to
transfer that part of said Warrant on the books of PALOMAR MEDICAL TECHNOLOGIES,
INC.
Signature:____________________ Assignee
Dated:________________________
Address:______________________ Address:______________________
SS/Fed ID#:___________________ SS/Fed ID#:___________________
