EXHIBIT NO. 4.3
FORM OF WARRANT
WARRANT TO PURCHASE COMMON SHARES
OF
FONAR CORPORATION
(A Delaware Corporation)
Warrant to Purchase
No. Shares
Not Exercisable Prior to November 29, 1997 (subject to modification as
provided in Section 2 hereof).
Void After 4:00 p.m. New York City time, May 28, 2002 (subject to
modification as provided in Section 2 hereof).
THIS CERTIFIES THAT _________________________, or registered
assigns ("Holder"), is entitled to purchase on and after November 29, 1997
and until 4:00 p.m., New York City time, May 28, 2002 _______________ shares
of the Common Stock, $.0001 par value ("Common Stock"), of FONAR CORPORATION
(the "Corporation") at a price of $.__ per share ("Warrant Price"), upon
surrender of this Warrant, with the form of subscription attached duly
executed by the Holder, at the office of the Corporation, 110 Marcus Drive,
Melville, New York 11747 or at the office of the Transfer Agent for the
Common Stock of the Corporation, and upon payment to the Corporation of the
price aforesaid for the shares so purchased.
1. Notwithstanding the foregoing, the Warrant Price shall be
reduced by the amount of any special dividends paid on the Common Stock on
any cash awards (in the form of damages, royalties or otherwise) collected
by the Corporation in connection with the enforcement of U.S. Patent No.
3,789,832 (Apparatus and Method for Detecting Cancer in Tissue).
2. If this Warrant be exercised in respect of less than all
the shares covered hereby, the Holder shall be entitled to receive a new
Warrant covering the number of shares in respect of which this Warrant shall
not have been exercised; provided, however, that this Warrant and all rights
and options hereunder shall, unless redeemed as hereinbelow provided, expire
at 4:00 p.m., New York City time, on May 28, 2002, and shall be wholly null
and void if and to the extent the Warrant is not exercised before it
expires.
3. THE WARRANTS ARE NOT REDEEMABLE BY THE CORPORATION.
4. The Corporation covenants and agrees that during the
period within which the rights represented by this Warrant may be exercised,
the Corporation will at all times have authorized, and in reserve, a
sufficient number of shares of Common Stock to provide for the exercise of
the rights represented by this Warrant.
5. The Corporation covenants and agrees that the Common Stock
represented by each and every certificate to be delivered on the exercise of
this Warrant as herein provided shall, at the time of such delivery, be
validly issued and outstanding and be fully paid and nonassessable, and the
Corporation will take all such action as may be necessary to assure that the
par value per share of Common Stock is at all times equal to or less than
the per share Warrant Price in effect from time to time hereunder.
In case the Corporation shall, while this Warrant remains in
force, effect a recapitalization of such character that the shares of Common
Stock covered hereby shall be changed into or become exchangeable for a
larger or smaller number of shares, then thereafter the number of shares of
Common Stock which the Holder hereof shall be entitled to purchase hereunder
shall be increased or decreased, as the case may be, in direct proportion to
the increase or decrease in the number of shares of Common Stock of the
Corporation effected by reason of such recapitalization, and the Warrant
Price hereunder, per share, of such recapitalized shares of Common Stock
shall, in the case of an increase in the number of shares, be
proportionately reduced, and, in the case of a decrease in the number of
shares, be proportionately increased. A stock dividend or stock split
shall, for the purposes hereof, be considered as an exchange for a larger
number of shares.
In case the Corporation shall be consolidated or merged with
another company, or substantially all of its assets shall be sold to another
company, in exchange for stock or property (including cash) with the view of
distributing such stock or property to its stockholders, each share of
Common Stock purchasable by this Warrant shall be replaced upon exercise for
the purposes hereof by the stock or property issued or distributed in
respect of one share of Common Stock of this Corporation upon such
consolidation, merger or sale and distribution, and adequate provision to
that effect shall be made at the time thereof.
6. The Board of Directors of the Corporation shall make such
adjustments in the Warrant Price and in the number and kind of shares
covered by this Warrant as the Board in its sole discretion exercised in
good faith may determine is equitably required to prevent dilution or
enlargement of the rights of the Holder that would otherwise result from (a)
any stock dividend, stock split, combination of shares or recapitalization
or (b) any merger, consolidation, separation, reorganization or partial or
complete liquidation. No adjustment provided for in the preceding sentence
shall require the Corporation to sell or issue any fractional shares.
In lieu of any fractional shares which would otherwise be
issuable hereunder, the Corporation may offer cash or issue scrip, as its
Board of Directors shall determine in its dole discretion.
7. This Warrant is issued subject to the condition that, and
every Holder hereof by accepting the same agrees with every subsequent
Holder hereof and with the Corporation that, delivery hereof by any person
in possession of the same however such possession may have been acquired
shall vest title hereof and all rights hereunder in the transferee to the
same extent and for all purposes as would delivery under like circumstances
of any negotiable instrument; and that the Corporation may treat the Holder
hereof as the absolute owner hereof for all purposes and shall not be
affected by any notice to the contrary.
8. The right to exercise this Warrant shall not be suspended
during any period while the stock transfer books of the Corporation may be
closed. The Corporation shall not be required, however, to deliver
certificates upon the exercise of this Warrant while such books are duly
closed for any purpose, but the Corporation may postpone the delivery of the
certificates for such shares of Common Stock until the opening of such
books, and they shall, in such case, be delivered forthwith upon the opening
thereof, or as soon as practicable thereafter.
9. In case any Warrant shall be mutilated, lost, stolen or
destroyed, the Corporation may issue a new Warrant of like date, tenor and
denomination and deliver the same in exchange and substitution for and upon
surrender and cancellation of any mutilated Warrant, or in lieu of any
Warrant lost, stolen or destroyed, upon receipt of evidence satisfactory to
the Corporation of the loss, theft or destruction of such Warrant, and upon
receipt of indemnity satisfactory to the Corporation and payment of the
reasonable expenses to replace said Warrant by the Holder thereof.
10. This Warrant does not entitle any Holder thereof to any
of the rights, privileges or liabilities, including without limitation,
liquidation rights, voting rights or dividend rights of a stockholder of the
Corporation.
WITNESS the seal of the Corporation and the signatures of its
duly authorized officers.
Dated: ______________, 1997
FONAR CORPORATION
By: ___________________________
President
(Seal)
Attest:
_______________________________
Secretary