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Exhibit 99.5
FORM OF WARRANT
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR REGISTERED OR QUALIFIED UNDER ANY APPLICABLE
STATE SECURITIES LAWS. THESE SECURITIES MAY NOT BE TRANSFERRED UNLESS (A)
COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND
REGISTERED OR QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS OR (B) EXEMPTIONS
FROM SUCH REGISTRATION OR QUALIFICATION REQUIREMENTS ARE AVAILABLE. AS A
CONDITION TO PERMITTING ANY TRANSFER OF THESE SECURITIES, THE COMPANY MAY
REQUIRE THAT IT BE FURNISHED WITH AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY TO THE EFFECT THAT NO REGISTRATION OR QUALIFICATION IS LEGALLY REQUIRED
FOR SUCH TRANSFER.
No. W-___ For the Purchase
of _____ shares of
Common Stock
WARRANT FOR THE PURCHASE OF
SHARES OF COMMON STOCK
OF
INVERNESS MEDICAL INNOVATIONS, INC.
VOID AFTER 5:00 P.M., EASTERN STANDARD TIME, ON DECEMBER __, 2011
Inverness Medical Innovations, Inc., a Delaware corporation (the
"Company"), hereby certifies that _______________, or his, her or its registered
assigns (the "Registered Holder"), is entitled, subject to the terms set forth
below, to purchase from the Company, at any time or from time to time on or
before the earlier of (a) December __, 2011 at not later than 5:00 p.m. (Eastern
Standard Time) and (b) the termination of this Warrant as provided in Section 8
below, _____ shares of Common Stock, $.001 par value, of the Company ("Common
Stock"), at a purchase price of $18.12 per share. The number of shares
purchasable upon exercise of this Warrant, and the purchase price per share,
each as adjusted from time to time pursuant to the provisions of this Warrant,
are hereinafter referred to as the "Warrant Stock" and the "Purchase Price,"
respectively.
[NOTE: THE NUMBER OF SHARES OF COMMON STOCK SUBJECT TO EACH WARRANT WILL BE
DETERMINED BY DIVIDING 5% OF THE REGISTERED HOLDER'S BRIDGE LOAN COMMITMENT BY
THE PURCHASE PRICE OF $18.12, WHICH IS THE AVERAGE CLOSING PRICE OF THE COMMON
STOCK FOR THE FIRST FIVE TRADING DAYS OF THE COMMON STOCK.]
1. EXERCISE.
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(a) This Warrant may be exercised by the Registered Holder, in
whole or in part, by surrendering this Warrant, with the purchase form appended
hereto as EXHIBIT I duly executed by such Registered Holder, at the principal
office of the Company, or at such other office or agency as the Company may
designate, accompanied by payment in full, as provided in subsection 1(b) below,
of the aggregate Purchase Price payable in respect of the number of shares of
Warrant Stock purchased upon such exercise.
(b) The aggregate Purchase Price may be paid, at the
Registered Holder's election, at any time during the term of this Warrant, (i)
by cash (including by wire transfer of immediately available funds to an account
designated by the Company) or certified or bank check in lawful money of the
United States or (ii) by exercise of the "net issuance" right described below in
this subsection 1(b) ("NET ISSUANCE"). If the Registered Holder elects the Net
Issuance method, the Company will issue Common Stock to the Registered Holder
upon exercise of this Warrant in accordance with the following formula:
X = Y(A-B)
------
A
Where: X = the number of shares of Common Stock that shall be
issued to the Registered Holder.
Y = the number of shares of Common Stock requested to be
exercised under this Warrant.
A = the current fair market value of one (1) share of Common
Stock at the time of issuance of such shares of Common
Stock.
B = the Purchase Price.
For purposes of the above calculation, current fair market value of
each share of Common Stock shall be determined as follows:
(i) if the Common Stock is traded on a national
securities exchange, the fair market value shall be deemed to be the average of
the closing prices of the Common Stock over the ten (10) trading day period
ending immediately prior to the day as of which the current fair market value of
the Common Stock is being determined; or
(ii) if the Common Stock is traded over-the-counter,
the fair market value shall be deemed to be the product of the average of the
closing bid and asked prices of the Common Stock quoted on the NASDAQ System (or
similar system) over the ten (10) trading day period ending immediately prior to
the day as of which the current fair market value of the securities is being
determined; or
(iii) if at any time the Common Stock is not listed
on any national securities exchange or quoted in the NASDAQ System (or similar
system) or the over-the-counter market, the current fair market value of the
Common Stock shall be as determined in good faith by the Company's Board of
Directors.
(c) Each exercise of this Warrant shall be deemed to have been
effected immediately prior to the close of business on the day on which this
Warrant shall have been
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surrendered to the Company as provided in subsection 1(a) above. At such time,
the person or persons in whose name or names any certificates for Warrant Stock
shall be issuable upon such exercise as provided in subsection 1(d) below shall
be deemed to have become the holder or holders of record of the Warrant Stock
represented by such certificates.
(d) As soon as practicable after the exercise of this Warrant
in full or in part and whether by payment by cash or check or by Net Issuance,
and in any event within fifteen (15) days thereafter, the Company, at its
expense, will cause to be issued in the name of, and delivered to, the
Registered Holder, or, subject to the terms and conditions hereof, as such
Registered Holder (upon payment by such Registered Holder of any applicable
transfer taxes) may direct:
(i) a certificate or certificates for the number of
full shares of Warrant Stock to which such Registered Holder shall be entitled
upon such exercise plus, in lieu of any fractional share to which such
Registered Holder would otherwise be entitled, cash in an amount determined
pursuant to Section 3 hereof, and
(ii) in case such exercise is in part only, a new
warrant or warrants (dated the date hereof) of like tenor, representing the
right to purchase in the aggregate the number of shares of Warrant Stock equal
(without giving effect to any adjustment therein) to the number of such shares
called for on the face of this Warrant minus the number of such shares purchased
or exercised by the Registered Holder upon such exercise as provided in
subsections 1(a) and 1(b) above.
(e) To the extent this Warrant is not previously exercised as
to all of the Warrant Stock subject hereto, and if the fair market value of one
share of Common Stock is greater than the Purchase Price then in effect, this
Warrant shall be deemed automatically exercised pursuant to the Net Issuance
method as provided in subsection 1(b) above (even if not surrendered)
immediately before its expiration. For purposes of such automatic exercise, the
fair market value of one (1) share of the Common Stock upon such expiration
shall be determined pursuant to the Net Issuance provisions of subsection 1(b).
To the extent this Warrant or any portion thereof is deemed automatically
exercised pursuant to this subsection 1(e), the Company agrees to promptly
notify the Registered Holder hereof of the number of shares of Warrant Stock, if
any, that the Registered Holder hereof is to receive by reason of such automatic
exercise.
2. ADJUSTMENTS.
(a) If outstanding shares of the Common Stock shall be
subdivided into a greater number of shares or a dividend in Common Stock shall
be paid in respect of Common Stock, the Purchase Price in effect immediately
prior to such subdivision or at the record date of such dividend shall
simultaneously with the effectiveness of such subdivision or immediately after
the record date of such dividend be proportionately reduced. If outstanding
shares of Common Stock shall be combined into a smaller number of shares, the
Purchase Price in effect immediately prior to such combination shall,
simultaneously with the effectiveness of such combination, be proportionately
increased. When any adjustment is required to be made in the Purchase Price, the
number of shares of Warrant Stock purchasable upon the exercise of this Warrant
shall be changed to the number determined by dividing (i) an amount equal to the
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number of shares issuable upon the exercise of this Warrant immediately prior to
such adjustment, multiplied by the Purchase Price in effect immediately prior to
such adjustment, by (ii) the Purchase Price in effect immediately after such
adjustment.
(b) If there shall occur any capital reorganization or
reclassification of the Common Stock (other than a change in par value or a
subdivision or combination as provided for in subsection 2(a) above), then, as
part of any such reorganization or reclassification, lawful provision shall be
made so that the Registered Holder of this Warrant shall have the right
thereafter to receive upon the exercise hereof the kind and amount of shares of
stock or other securities or property which such Registered Holder would have
been entitled to receive if, immediately prior to any such reorganization or
reclassification, such Registered Holder had held the number of shares of Common
Stock which were then purchasable upon the exercise of this Warrant. In any such
case, appropriate adjustment (as reasonably determined by the Board of Directors
of the Company) shall be made in the application of the provisions set forth
herein with respect to the rights and interests thereafter of the Registered
Holder of this Warrant such that the provisions set forth in this Section 2
(including provisions with respect to adjustment of the Purchase Price) shall
thereafter be applicable, in as nearly equivalent a manner as may be
practicable, in relation to any shares of stock or other securities or property
thereafter deliverable upon the exercise of this Warrant.
(c) Subject to the provisions of Section 8, if there shall be
a merger or consolidation of the Company with or into another corporation (other
than a merger or reorganization involving only a change in the state of
incorporation of the Company or the acquisition by the Company of other
businesses where the Company survives as a going concern), or the sale of all or
substantially all of the Company's capital stock or assets to any other person,
then as a part of such transaction, provision shall be made so that the
Registered Holder shall thereafter be entitled to receive the number of shares
of stock or other securities or property of the Company, or of the successor
corporation resulting from the merger, consolidation or sale, to which the
Registered Holder would have been entitled if the Registered Holder had
exercised its rights pursuant to the Warrant immediately prior thereto. In any
such case, appropriate adjustment shall be made in the application of the
provisions of this Section 2 to the end that the provisions of this Section 2
shall be applicable after that event in as nearly equivalent a manner as may be
practicable.
(d) When any adjustment is required to be made in the Purchase
Price, the Company shall promptly mail to the Registered Holder a certificate
setting forth the Purchase Price after such adjustment and setting forth a brief
statement of the facts requiring such adjustment. Such certificate shall also
set forth the kind and amount of stock or other securities or property into
which this Warrant shall be exercisable following the occurrence of any of the
events specified in this Section 2.
3. FRACTIONAL SHARES. The Company shall not be required upon the
exercise of this Warrant to issue any fractional shares, but shall make an
adjustment therefor in cash on the basis of the closing market price of the
Common Stock on the American Stock Exchange or, if applicable, any other
national securities exchange on the trading day immediately prior to the date of
exercise or on the basis of the mean between the low bid and high asked prices
of the Common Stock on the over-the-counter market as reported by the NASDAQ
System (or similar
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system), whichever is applicable, or if neither is applicable, then on the basis
of the then current market value of the Common Stock as shall be reasonably
determined by the Company's Board of Directors.
4. LIMITATION ON SALES, ETC. Each holder of this Warrant acknowledges
that this Warrant and the Warrant Stock have not been registered under the
Securities Act of 1933, as now in force or hereafter amended, or any successor
legislation (the "Securities Act"), and agrees not to sell, pledge, distribute,
offer for sale, transfer or otherwise dispose of this Warrant or any Warrant
Stock issued upon its exercise unless (a) there is an effective registration
statement under the Securities Act as to this Warrant or such Warrant Stock and
this Warrant or such Warrant Stock has been registered or qualified under any
applicable state securities or "blue sky" laws then in effect, or (b) the
Company receives an opinion of counsel, satisfactory to the Company, that such
registration and qualification are not required.
Without limiting the generality of the foregoing, unless the offering
and sale of the Warrant Stock to be issued upon the particular exercise of the
Warrant shall have been effectively registered under the Securities Act, the
Company shall be under no obligation to issue the shares covered by such
exercise unless and until the Registered Holder shall have executed an
investment letter in form and substance satisfactory to the Company, including a
warranty at the time of such exercise that it is acquiring such shares for its
own account, for investment and not for, with a view to, or in connection with,
the distribution or resale of any such shares, and the holder of this Warrant
shall be bound by the provisions of the following legend or a legend in
substantially similar form which shall be endorsed upon the certificate(s)
evidencing the Warrant Stock issued pursuant to such exercise:
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED ("SECURITIES ACT"), OR
REGISTERED OR QUALIFIED UNDER ANY APPLICABLE STATE SECURITIES
LAWS. THESE SECURITIES MAY NOT BE TRANSFERRED UNLESS (A)
COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND REGISTERED OR QUALIFIED UNDER APPLICABLE
STATE SECURITIES LAWS OR (B) EXEMPTIONS FROM SUCH REGISTRATION
OR QUALIFICATION REQUIREMENTS ARE AVAILABLE. AS A CONDITION TO
PERMITTING ANY TRANSFER OF THESE SECURITIES, THE COMPANY MAY
REQUIRE THAT IT BE FURNISHED WITH AN OPINION OF COUNSEL
ACCEPTABLE TO THE COMPANY TO THE EFFECT THAT NO REGISTRATION
OR QUALIFICATION IS LEGALLY REQUIRED FOR SUCH TRANSFER."
In addition, without limiting the generality of the foregoing, the
Company may delay issuance of the Warrant Stock until completion of any action
or obtaining of any consent, which the Company deems necessary under any
applicable law (including, without limitation, state securities or "blue sky"
laws).
5. NOTICES OF RECORD DATE, ETC. In case:
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(a) the Company shall take a record of the holders of its
Common Stock (or other stock or securities at the time deliverable upon the
exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution, or to receive any right to subscribe
for or purchase any shares of stock of any class or any other securities, or to
receive any other right; or
(b) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company with or into another corporation (other than a
consolidation or merger in which the Company is the surviving entity), or any
transfer of all or substantially all of the assets of the Company; or
(c) of the voluntary or involuntary dissolution, liquidation
or winding-up of the Company;
then, and in each such case, the Company will mail or cause to be mailed to the
Registered Holder of this Warrant a notice specifying, as the case may be, (i)
the date on which a 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, or (ii) the effective date on which such reorganization,
reclassification, consolidation, merger, transfer, 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 (or such other stock or securities at the
time deliverable upon the exercise of this Warrant) shall be entitled to
exchange their shares of Common Stock (or such other stock or securities) for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up. Such notice shall be mailed at least ten (10) days prior to the
record date or effective date for the event specified in such notice.
6. RESERVATION OF STOCK. The Company will at all times reserve and keep
available, solely for issuance and delivery upon the exercise of this Warrant,
such shares of Warrant Stock and other stock, securities and property, as from
time to time shall be issuable upon the exercise of this Warrant.
7. REPLACEMENT OF WARRANTS. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.
8. TERMINATION IN CERTAIN EVENTS. In the event of a transfer of all or
substantially all of the assets of the Company or a merger or consolidation of
the Company with or into any other entity (other than a merger the sole purpose
of which is to change the state of incorporation of the Company) or a
dissolution or winding-up or the adoption of a plan of liquidation of the
Company, this Warrant shall terminate on the effective date of such transfer,
merger, consolidation, dissolution, winding-up or adoption (the "Transaction
Effective Date") and shall become null and void, PROVIDED that the Registered
Holder shall have received the prior notice with respect to such transaction or
event required by Section 5 hereof, and PROVIDED FURTHER,
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HOWEVER, that if this Warrant shall not have otherwise terminated or expired,
the Registered Holder hereof shall have the right until 5:00 p.m. (Eastern
Standard Time) on the day immediately prior to the Transaction Effective Date to
exercise its rights hereunder to the extent not previously exercised.
9. RESTRICTIONS. This Warrant and the securities issuable pursuant to
this Warrant are subject to additional restrictions on transferability set forth
in the Note and Warrant Purchase Agreement dated as of December ___, 2001
entered into among the Company, the Registered Holder and the other investors
party thereto.
10. WARRANT REGISTER; TRANSFERS, ETC.
(a) The Company will maintain a register containing the names
and addresses of the Registered Holders of this Warrant. Any Registered Holder
may change its, his or her address as shown on the warrant register by written
notice to the Company requesting such change.
(b) This Warrant shall not be transferable by the Registered
Holder without the prior written consent of the Company and shall be exercisable
only by the Registered Holder. Without the prior written consent of the Company,
the Warrant shall not be assigned, pledged or hypothecated in any way (whether
by operation of law or otherwise) and shall not be subject to execution,
attachment or similar process. Any attempted transfer, assignment, pledge,
hypothecation or other disposition of the Warrant or of any rights granted
hereunder contrary to the provisions of this Paragraph, or the levy of any
attachment or similar process upon the Warrant or such rights, shall be null and
void.
(c) Until any transfer of this Warrant is made in the warrant
register, the Company may treat the Registered Holder of this Warrant as the
absolute owner hereof for all purposes; PROVIDED, HOWEVER, that if and when this
Warrant is properly assigned in blank, the Company may (but shall not be
obligated to) treat the bearer hereof as the absolute owner hereof for all
purposes, notwithstanding any notice to the contrary.
11. MAILING OF NOTICES, ETC. Any notice required or permitted to be
given to the Company or the Registered Holder under this Warrant shall be made
in writing at the address or facsimile number of such person specified below (or
such other address or facsimile number as such person may specify in a written
notice to the other party) and shall be deemed to have been given, if delivered
personally or sent via electronic facsimile transmission with confirmation
received, on the date of delivery or, if sent via nationally recognized
overnight express courier with established tracking capability marked for
delivery on the next business day, on the earlier of the date of delivery, as
demonstrated by the tracking records of the courier, or two (2) business days
after deposit of the notice with the courier:
if to the Company, to:
Inverness Medical Innovations, Inc.
51 Sawyer Road, Suite 200
Waltham, Massachusetts 02453
Facsimile: (781) 674-3939
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Attention: Ron Zwanziger, President
with a copy to:
Foley, Hoag & Eliot, LLP
One Post Office Square
Boston, Massachusetts 02109
Facsimile: (617) 832-7000
Attention: John D. Patterson, Jr., Esq.
if to the Registered Holder of this Warrant, to the address furnished to the
Company in writing by the last Registered Holder of this Warrant who shall have
furnished an address to the Company in writing.
12. NO RIGHTS AS STOCKHOLDER. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a stockholder of the Company.
13. CHANGE OR WAIVER. Any term of this Warrant may be changed or waived
only by an instrument in writing signed by the party against which enforcement
of the change or waiver is sought.
14. HEADINGS. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
15. GOVERNING LAW. This Warrant shall be governed by, and construed and
enforced in accordance with, the substantive laws of the Commonwealth of
Massachusetts without regard to its principles of conflicts of laws. Any dispute
arising out of or relating to this Warrant shall be filed and prosecuted in any
court of competent subject matter jurisdiction located in Massachusetts. The
Company and the Registered Holder hereby consent to the personal jurisdiction of
such courts over them, stipulate to the convenience, fairness and efficiency of
proceeding in such courts, and covenant not to assert any objection to
proceeding in such courts based on any alleged lack of jurisdiction or any
alleged inconvenience, unfairness or inefficiency of such courts.
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IN WITNESS WHEREOF, the undersigned has caused this Warrant to be
executed by its duly authorized officer as of the date written below.
Date: December ___, 2001 INVERNESS MEDICAL INNOVATIONS, INC.
By:______________________________
Name:
Title:
[Corporate Seal]
ATTEST:
_________________________
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EXHIBIT I
PURCHASE FORM
To: INVERNESS MEDICAL INNOVATIONS, INC.
__________________________
__________________________ Dated: ____________________
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. W-____), hereby irrevocably elects to purchase _____ shares of the
Common Stock (the "Common Stock") covered by such Warrant and [CASH OR CHECK
PAYMENT: herewith tenders payment of $_____] [NET ISSUANCE: elects pursuant to
Section 1(b) of the Warrant to effect a Net Issuance], representing the full
purchase price for such shares at the price per share provided for in such
Warrant.
The undersigned is aware that the Common Stock has not been registered
under the Securities Act of 1933, as amended (the "Securities Act"), or any
state securities laws. The undersigned understands that the reliance by the
Company on exemptions under the Securities Act is predicated in part upon the
truth and accuracy of the statements of the undersigned in this Purchase Form.
The undersigned represents and warrants that (1) it has been furnished
with all information which it deems necessary to evaluate the merits and risks
of the purchase of the Common Stock; (2) it has had the opportunity to ask
questions concerning the Common Stock and the Company and all questions posed
have been answered to its satisfaction; (3) it has been given the opportunity to
obtain any additional information it deems necessary to verify the accuracy of
any information obtained concerning the Common Stock and the Company; and (4) it
has such knowledge and experience in financial and business matters that it is
able to evaluate the merits and risks of purchasing the Common Stock and to make
an informed investment decision relating thereto.
The undersigned is an "accredited investor," as such term is defined in
Rule 501 promulgated by the Securities and Exchange Commission (the "SEC") under
the Securities Act.
The undersigned hereby represents and warrant that it is purchasing the
Common Stock for its own account for investment and not for, with a view to, or
in connection with, the distribution or resale of all or any part of the Common
Stock.
The undersigned understands that because the Common Stock have not been
registered under the Securities Act, it must continue to bear the economic risk
of the investment for an indefinite time and the Common Stock cannot be sold
unless the Common Stock is subsequently registered under applicable federal and
state securities laws or an exemption from such registration is available.
The undersigned agrees that it will in no event sell or distribute or
otherwise dispose of all or any part of the Common Stock unless (1) there is an
effective registration statement under
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the Securities Act and registration or qualification under applicable state
securities laws covering any such transaction involving the Common Stock or (2)
the Company receives an opinion of its legal counsel (concurred in by legal
counsel for the Company) stating that such transaction is exempt from
registration and qualification or the Company otherwise satisfies itself that
such transaction is exempt from registration and qualification.
The undersigned consents to the placing of a legend on its certificate
for the Common Stock stating that the Common Stock has not been registered and
setting forth the restriction on transfer contemplated hereby and to the placing
of a stop transfer order on the books of the Company and with any transfer
agents against the Common Stock until the Common Stock may be legally resold or
distributed without restriction.
The undersigned understands that, at the present time, the undersigned
may not be entitled to rely on Rule 144 promulgated by the SEC under the
Securities Act for the resale or distribution of the Securities. The undersigned
understands that, except as provided in the Note and Warrant Purchase Agreement
dated as of December __, 2001 among the Company and the investors named therein
or as may otherwise have been separately and expressly agreed by the Company and
the Registered Holder, the Company has no obligation to the undersigned to
register the Common Stock under the Securities Act and has not represented that
it will register the Common Stock.
The undersigned understands the terms and restrictions on the right to
dispose of the Common Stock set forth in the Note and Warrant Purchase
Agreement, which the undersigned has carefully reviewed. The undersigned
consents to the placing of a legend on its certificate for the Common Stock
referring to such restrictions and the placing of stop transfer orders until the
Common Stock may be transferred in accordance with the terms of such
restrictions.
The undersigned has considered the federal and state income tax
implications of the exercise of the Warrant and the purchase and subsequent sale
of the Common Stock.
___________________________
Dated: _____________________
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