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EXHIBIT 4.3
WARRANT AGREEMENT
AMONG
MAXXIM MEDICAL, INC.
and
the parties named herein
Dated as of November 12, 1999
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TABLE OF CONTENTS
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SECTION 1. Warrant Certificates...............................................1
SECTION 2. Execution of Warrant Certificates..................................1
SECTION 3. Registration.......................................................2
SECTION 4. Registration of Transfers and Exchanges............................2
SECTION 5. Warrants; Exercise of Warrants.....................................5
SECTION 6. Payment of Taxes...................................................7
SECTION 7. Mutilated or Missing Warrant Certificates..........................7
SECTION 8. Reservation of Warrant Shares......................................7
SECTION 9. Obtaining Stock Exchange Listings..................................8
SECTION 10. Adjustment of Number of Warrant Shares Issuable....................8
SECTION 11. Fractional Interests..............................................18
SECTION 12. Notices to Holders................................................18
SECTION 13. Mandatory Exercise in the Event of an Initial Public Offering.....20
SECTION 14. Notices to Company and Holders....................................20
SECTION 15. Supplements and Amendments........................................23
SECTION 16. Successors........................................................23
SECTION 17. Termination.......................................................23
SECTION 18. Governing Law.....................................................23
SECTION 19. Benefits of This Agreement........................................23
SECTION 20. Headings..........................................................24
SECTION 21. Submission to Jurisdiction........................................24
SECTION 22. Waiver of Jury Trial..............................................24
SECTION 23. Service of Process................................................24
SECTION 24. Counterparts......................................................24
Exhibit A - Form of Warrant Certificate
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WARRANT AGREEMENT (the "Warrant Agreement" or this "Agreement") dated
as of November 12 , 1999 (the "Issue Date") between Maxxim Medical, Inc., a
Texas corporation (the "Company"), and GS Mezzanine Partners, L.P., GS
Mezzanine Partners Offshore, L.P., John Hancock Mutual Life Insurance Company,
John Hancock Variable Life Insurance Company, Signature 3 Limited, Merrill
Lynch International, The Northwestern Mutual Life Insurance Company, Chase
Equity Associates, L.P., CIBC WMC, Inc., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Nationwide Life Insurance Company, Deutsche Bank AG, New York
Branch and Credit Suisse First Boston Corporation (collectively, the
"Purchasers," such Purchasers, together with their successors and assigns being
referred to herein as the "Holders").
Terms used but not defined herein are used as defined in the Purchase
Agreement (the "Purchase Agreement") dated as of November 12, 1999 among the
Company, Maxxim Medical Group, Inc., a Delaware corporation and a wholly owned
subsidiary of the Company ("Maxxim Medical Group"), certain subsidiaries of the
Company signatory thereto and the Purchasers.
WHEREAS, the Company proposes to issue Warrants, as hereinafter
described (the "Warrants"), to purchase up to118,908 shares of Common Stock
(the "Common Stock") of the Company (the Common Stock issuable on exercise of
the Warrants being referred to herein as the "Warrant Shares"), and sell to the
Purchasers, pursuant to the Purchase Agreement, an aggregate of 144,552 Units,
each Unit consisting of $1,000 principal amount at maturity of Maxxim Medical
Group's Senior Subordinated Discount Notes due 2009 and one Warrant entitling
the holder thereof to purchase 0.8226 Warrant Shares.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
SECTION 1. Warrant Certificates. The certificates evidencing the
Warrants (the "Warrant Certificates") to be delivered pursuant to this
Agreement shall be in registered form only and shall be substantially in the
form set forth in Exhibit A attached hereto.
SECTION 2. Execution of Warrant Certificates. Warrant Certificates
shall be signed on behalf of the Company by its Chairman of the Board or its
President or a Vice President and by its Secretary or an Assistant Secretary
under its corporate seal. Each such signature upon the Warrant Certificates may
be in the form of a facsimile signature of the present or any future Chairman
of the Board, President, Vice President, Secretary or Assistant Secretary and
may be imprinted or otherwise reproduced on the Warrant Certificates and for
that purpose the Company may adopt and use the facsimile signature of any
person who shall have been Chairman of the Board, President, Vice President,
Secretary or Assistant Secretary, notwithstanding the fact that at the time the
Warrant Certificates shall be delivered or disposed of he shall have ceased to
hold such office. The seal of the Company may be in the form of a
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facsimile thereof and may be impressed, affixed, imprinted or otherwise
reproduced on the Warrant Certificates.
In case any officer of the Company who shall have signed any of the
Warrant Certificates shall cease to be such officer before the Warrant
Certificates so signed shall have been disposed of by the Company, such Warrant
Certificates nevertheless may be delivered or disposed of as though such person
had not ceased to be such officer of the Company; and any Warrant Certificate
may be signed on behalf of the Company by any person who, at the actual date of
the execution of such Warrant Certificate, shall be a proper officer of the
Company to sign such Warrant Certificate, although at the date of the execution
of this Warrant Agreement any such person was not such an officer.
SECTION 3. Registration. The Company shall number and register the
Warrant Certificates in a register as they are issued. The Company may deem and
treat the registered holder(s) of the Warrant Certificates as the absolute
owner(s) thereof (notwithstanding any notation of ownership or other writing
thereon made by anyone), for all purposes, and shall not be affected by any
notice to the contrary. The Company shall act as the registrar for the
Warrants.
SECTION 4. Registration of Transfers and Exchanges. (a) The Company
shall from time to time register the transfer of any outstanding Warrant
Certificates in a Warrant register to be maintained by the Company upon
surrender thereof accompanied by a written instrument or instruments of
transfer in the form as set forth on the reverse side of the form of Warrant
Certificate attached hereto as Exhibit A, duly executed by the registered
holder or holders thereof or by the duly appointed legal representative thereof
or by a duly authorized attorney, together with (if such transfer is pursuant
to clause (1)(w) or (1)(y) of the next paragraph) the opinion of counsel
specified therein. Upon any such registration of transfer, a new Warrant
Certificate shall be issued to the transferee(s) and the surrendered Warrant
Certificate shall be cancelled and disposed of by the Company.
The Holders, by their acceptance of Warrant Certificates or
certificates evidencing Warrant Shares, agree that any proposed resale, pledge
or other transfer (including any transfer by issuance of Warrant Shares upon
exercise of a Warrant evidenced by a Warrant Certificate in a name other than
the name in which such Warrant Certificate is registered) of any Warrant or
Warrant Shares may be effected only (1)(w) inside the United States (i) to a
person who the seller reasonably believes is a qualified institutional buyer
within the meaning of Rule 144A under the Securities Act in a transaction
meeting the requirements of Rule 144A, (ii) in accordance with Rule 144 under
the Securities Act or (iii) pursuant to another exemption from the registration
requirements of the Securities Act (and based upon an opinion of counsel
reasonably satisfactory to the Company to such effect, if the Company so
requests), (x) to the Company, (y) outside the United States to a foreign
person in a transaction meeting the requirements of Rule 904 under the
Securities Act (and based upon an opinion of counsel reasonably satisfactory to
the Company to such effect, if the Company so requests) or (z), in the case of
Warrant Shares only, pursuant to an
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effective registration statement under the Securities Act and (2) in each case,
in accordance with the applicable securities laws of any state of the United
States or any other applicable jurisdiction. Each Holder, by acceptance of
Warrant Certificates or certificates evidencing Warrant Shares, agrees to, and
each subsequent Holder is required to, notify any purchaser thereof of the
resale restrictions set forth above. Prior to any proposed resale, pledge or
other transfer (including any transfer by issuance of Warrant Shares upon
exercise of a Warrant evidenced by a Warrant Certificate in a name other than
the name in which such Warrant Certificate is registered) of any Warrant or
Warrant Shares, the Holder thereof shall give written notice to the Company of
such Holder's intention to effect such transfer and the names and circumstances
thereof and, if the proposed transfer is pursuant to clause (1)(w) or (1)(y) of
the second preceding sentence, will, if requested by the Company, deliver to
the Company:
(1) an investment covenant, signed by the proposed
transferee, setting forth acceptance of the provisions referenced in
this Section 4 reasonably satisfactory to the Company;
(2) an agreement by such transferee to the impression of the
restrictive investment legend set forth below on the Warrant or the
Warrant Shares;
(3) an agreement by such transferee that the Company may
place a notation in the stock books of the Company or a "stop transfer
order" with any transfer agent or registrar with respect to the
Warrant Shares or such other legend as the Company reasonably believes
is required by law; and
(4) an agreement by such transferee to be bound by the
provisions of this Section 4 relating to the transfer of such Warrant
or Warrant Shares.
The Holders agree that each Warrant Certificate and any certificate
representing the Warrant Shares will bear a legend substantially in the
following form:
THE SECURITY REPRESENTED BY THIS CERTIFICATE (AND ANY PREDECESSOR) WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER
SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. THE HOLDER OF THE
SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF MAXXIM MEDICAL,
INC., A TEXAS CORPORATION (THE "COMPANY") THAT (A) SUCH SECURITY (AND,
IF SUCH SECURITY EVIDENCES A WARRANT, THE WARRANT SHARES ISSUABLE
PURSUANT THERETO) MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED,
ONLY (1) (W) INSIDE THE UNITED STATES (I) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED
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INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A,
OR (II) IN ACCORDANCE WITH RULE 144 UNDER THE SECURITIES ACT, OR (III)
PURSUANT TO ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL, IF THE
COMPANY SO REQUESTS), (X) TO THE COMPANY, (Y) OUTSIDE THE UNITED
STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE REQUIREMENTS
OF RULE 904 UNDER THE SECURITIES ACT (AND BASED UPON AN OPINION OF
COUNSEL, IF THE COMPANY SO REQUESTS) OR (Z) IN THE CASE OF SHARES
ONLY, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND (2) IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT
HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE SECURITY EVIDENCED
HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE. THE SECURITY
REPRE SENTED BY THIS CERTIFICATE IS ALSO SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFERABILITY, AND HAS THE BENEFIT OF CERTAIN
REGISTRATION RIGHTS, CONTAINED IN THE STOCKHOLDERS' AGREEMENT, DATED
AS OF NOVEMBER 12, 1999, AS AMENDED FROM TIME TO TIME, A COPY OF WHICH
TS ON FILE AT THE COMPANY'S PRINCIPAL EXECUTIVE OFFICES.
Subject to the foregoing provisions, Warrant Certificates may be
exchanged at the option of the Holder(s) thereof, when surrendered to the
Company at its office for another Warrant Certificate or other Warrant
Certificates of like tenor and representing in the aggregate a like number of
Warrants. Warrant Certificates surrendered for exchange shall be cancelled and
disposed of by the Company.
On delivery of the Warrants by the Company to the Purchasers pursuant
to the Purchase Agreement, each Holder will have registration rights with
respect to the Warrant Shares set forth in the Stockholders' Agreement, dated
as of November 12, 1999, among the Company and the other parties set forth on
the signature pages thereto, as the same may be amended from time to time (the
"Stockholders Agreement").
Every Holder, by accepting a Warrant Certificate, consents and agrees
with the Company and with every subsequent Holder of such Warrant Certificate
that, prior to due presentment of such Warrant Certificate for registration of
transfer, the Company may treat the person in whose name the Warrant
Certificate is registered as the owner thereof for all purposes and as the
person entitled to exercise the rights granted under the Warrants, and neither
the Company nor any agent thereof shall be affected by any notice to the
contrary.
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(b) Termination of Restrictions. The restriction referred to in the
legend referenced in Section 4(a) of this Agreement shall cease and terminate
as to any particular Warrants or Warrant Certificates or certificates
representing Warrant Shares when, in the reasonable opinion of counsel for the
Company, such restriction is no longer required in order to assure compliance
with the Securities Act. The Company or the Company's counsel, at their
election, may request from any Holder a certificate or an opinion of such
Holder's counsel with respect to any relevant matters in connection with the
removal of the legend set forth in Section 4(a) from such Holder's Warrant
Certificate(s), any such certificate or opinion of counsel to be reasonably
satisfactory to the Company and its counsel. The restrictions referred to in
Section 4(a) shall cease and terminate as to any particular Warrants, Warrant
Certificates and certificates representing Warrant Shares when, in the
reasonable opinion of counsel for the Company, the provisions of this Agreement
are no longer applicable to such Warrants, Warrant Certificates or certificates
representing Warrant Shares, or this Agreement shall have terminated in
accordance with its terms. Any other restrictions referred to in any other
legends required pursuant to Section 4 shall cease and terminate when, in the
reasonable opinion of counsel for the Company, such restrictions are no longer
applicable. Whenever such restrictions shall cease and terminate as to any
Warrants, Warrant Certificates and certificates representing Warrant Shares,
the Holder shall be entitled to receive from the Company, without expense
(other than applicable transfer taxes, if any, if such unlegended shares are
being delivered and transferred to any person other than the registered holder
thereof), new certificates for a like number of Warrants, Warrant Certificates
and certificates representing Warrant Shares not bearing the relevant legend(s)
set forth or referred to in Section 4.
SECTION 5. Warrants; Exercise of Warrants. Subject to the terms of
this Agreement, each Holder shall have the right, which may be exercised
commencing at the opening of business on the Issue Date and until 5:00 p.m.,
New York City time on November 12, 2004, to receive from the Company the number
of fully paid and nonassessable Warrant Shares which the Holder may at the time
be entitled to receive on exercise of such Warrants and payment of the Exercise
Price then in effect for such Warrant Shares. Each Warrant not exercised prior
to 5:00 p.m., New York City time, November 12, 2004 shall become void and all
rights thereunder and all rights in respect thereof under this Agreement shall
cease as of such time.
A Warrant may be exercised upon surrender to the Company at its office
designated for such purpose (the address of which is set forth in Section 14
hereof) of the Warrant Certificate to be exercised with the form of election to
purchase on the reverse thereof duly filled in and signed, which signature
shall be guaranteed by a bank or trust company having an office or
correspondent in the United States or a broker or dealer which is a member of a
registered securities exchange or the National Association of Securities
Dealers, Inc., together with (if such exercise involves a transfer pursuant to
clause (1)(w) or (1)(y) of the second paragraph of Section 4) the opinion of
counsel specified therein, and upon payment to the Company of the exercise
price (the "Exercise Price") which is set forth in the form of Warrant
Certificate attached hereto as Exhibit A, as adjusted as provided in this
Agreement, for the
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number of Warrant Shares in respect of which such Warrants are then exercised.
Payment of the aggregate Exercise Price shall be made in cash or by certified
or official bank check to the order of the Company. In lieu of exercising a
Warrant by paying in full the Exercise Price plus transfer taxes (if applicable
pursuant to Section 6), if any, the Holder may, from time to time, convert such
Warrant(s), in whole or in part, into a number of shares of Common Stock
determined by dividing (a) the aggregate current market price of the number of
shares of Common Stock represented by the Warrants converted, minus the
aggregate Exercise Price for such shares of Common Stock, minus transfer taxes,
if any, by (b) the current market price of one share of Common Stock. The
current market price shall be determined pursuant to Section 10(f).
Subject to the provisions of Section 6 hereof, upon such surrender of
Warrant Certificates and payment of the Exercise Price the Company shall issue
and cause to be delivered with all reasonable dispatch (and in any event within
10 Business Days after such receipt) to or upon the written order of the Holder
and, subject to Section 4, in such name or names as the Holder may designate, a
certificate or certificates for the number of full Warrant Shares issuable upon
the exercise of such Warrants together with cash as provided in Section 11;
provided, however, that if any consolidation, merger or lease or sale of assets
is proposed to be effected by the Company as described in subsection (1) of
Section 10 hereof, or a tender offer or an exchange offer for shares of Common
Stock of the Company shall be made, upon such surrender of Warrant Certificates
and payment of the Exercise Price as aforesaid, the Company shall, as soon as
possible, but in any event not later than five business days thereafter, issue
and cause to be delivered the full number of Warrant Shares issuable upon the
exercise of such Warrants in the manner described in this sentence together
with cash as provided in Section 11. Such certificate or certificates shall be
deemed to have been issued and any person so designated to be named therein
shall be deemed to have become a holder of record of such Warrant Shares as of
the date of the surrender of such Warrant Certificates and payment of the
Exercise Price.
Prior to the exercise of the Warrants, except as may be specifically
provided for herein, (i) no Holder, as such, shall be entitled to any of the
rights of a holder of Common Stock of the Company, including, without
limitation, the right to vote at or to receive any notice of any meetings of
stockholders; (ii) the consent of any such Holder shall not be required with
respect to any action or proceeding of the Company; (iii) except as provided in
Section 10(i), no such Holder, by reason of the ownership or possession of a
Warrant or the Warrant Certificate representing the same, shall have any right
to receive any cash dividends, stock dividends, allotments or rights or other
distributions paid, allotted or distributed or distributable to the
stockholders of the Company prior to, or for which the relevant record date
preceded, the date of the exercise of such Warrant; and (iv) no such Holder
shall have any right not expressly conferred by the Warrant or Warrant
Certificate held by such Holder.
The Warrants shall be exercisable, at the election of the Holders
thereof, either in full or from time to time in part and, in the event that a
Warrant Certificate is exercised in respect of fewer than all of the Warrant
Shares issuable on such exercise at any time prior to the date of expiration of
the Warrants, a new Warrant Certificate evidencing the remaining Warrant or
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Warrants will be issued and delivered pursuant to the provisions of this
Section and of Section 2 hereof.
All Warrant Certificates surrendered upon exercise of Warrants shall
be cancelled and disposed of by the Company. The Company shall keep copies of
this Agreement and any notices given or received hereunder available for
inspection by the Holders during normal business hours at its office.
SECTION 6. Payment of Taxes. The Company will pay all documentary
stamp taxes attributable to the initial issuance of Warrant Shares upon the
exercise of Warrants; provided, however, that the Company shall not be required
to pay any tax or taxes which may be payable in respect of any transfer
involved in the issue of any Warrant Certificates or any certificates
representing Warrant Shares in a name other than that of the registered holder
of a Warrant Certificate surrendered for registration of transfer or upon the
exercise of a Warrant, and the Company shall not be required to issue or
deliver such Warrant Certificates unless or until the person or persons
requesting the issuance thereof shall have paid to the Company the amount of
such tax or shall have established to the reasonable satisfaction of the
Company that such tax has been paid.
SECTION 7. Mutilated or Missing Warrant Certificates. In case any of
the Warrant Certificates shall be mutilated, lost, stolen or destroyed, the
Company may in its discretion issue, in exchange and substitution for and upon
cancellation of the mutilated Warrant Certificate, or in lieu of and
substitution for the Warrant Certificate lost, stolen or destroyed, a new
Warrant Certificate of like tenor and representing an equivalent number of
Warrants, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction of such Warrant Certificate and
indemnity, if requested, also reasonably satisfactory to it. Applicants for
such substitute Warrant Certificates shall also comply with such other
reasonable regulations and pay such other reasonable charges as the Company may
prescribe.
SECTION 8. Reservation of Warrant Shares. The Company will at all
times reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued Common Stock or its authorized and
issued Common Stock held in its treasury, for the purpose of enabling it to
satisfy any obligation to issue Warrant Shares upon exercise of Warrants, the
maximum number of shares of Common Stock which may then be deliverable upon the
exercise of all outstanding Warrants.
The Company or, if appointed, the transfer agent for the Common Stock
(the "Transfer Agent") and every subsequent transfer agent for any shares of
the Company's capital stock issuable upon the exercise of any of the rights of
purchase aforesaid will be irrevocably authorized and directed at all times to
reserve such number of authorized shares as shall be required for such purpose.
The Company will keep a copy of this Agreement on file with the Transfer Agent
and with every subsequent transfer agent for any shares of the Company's
capital stock issuable upon the exercise of the rights of purchase represented
by the Warrants. The
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Company will furnish such Transfer Agent a copy of all notices of adjustments
and certificates related thereto, transmitted to each Holder.
Before taking any action which would cause an adjustment pursuant to
Section 10 hereof to reduce the Exercise Price below the then par value (if
any) of the Warrant Shares, the Company will take any corporate action which
may, in the opinion of its counsel (which may be counsel employed by the
Company), be necessary in order that the Company may validly and legally issue
fully paid and nonassessable Warrant Shares at the Exercise Price as so
adjusted.
The Company covenants that all Warrant Shares which may be issued upon
exercise of the Warrants will, upon issue, be duly authorized, fully paid,
nonassessable, free of preemptive rights and, subject to Section 6, free from
all taxes, liens, charges and security interests other than the restrictions
contained in the Stockholders Agreement. The Company further covenants,
represents and warrants that, (a) as of the Issue Date, no form of general
solicitation or general advertising was used by the Company or, to the best of
its knowledge, any other Person acting on behalf of the Company, in respect of
the Warrants or the Warrant Shares or in connection with the issuance of the
Warrants; (b) as of the Issue Date, neither the Company nor any Person acting
on behalf of the Company has, either directly or indirectly, sold or offered
for sale to any Person any of the Warrants, the Warrant Shares or any other
similar security of the Company except (i) as contemplated by this Agreement,
(ii) the issuance and sale of the warrants issued by the Company in connection
with the issuance and sale by the Company of $50 million aggregate principal
amount at maturity of senior discount notes due 2010 and (iii) the issuance and
sale of shares of Common Stock and the grant of options to purchase shares of
Common Stock of the Company in connection with the Agreement and Plan of Merger
dated as of June 13, 1999, as amended, between the Company and Fox Paine Medic
Acquisition Corporation; and (c) neither the Company nor any Person acting on
its behalf will sell or offer for sale any such security to or solicit any
offers to buy any such security from, or otherwise approach or negotiate in
respect thereof with, any Person or Persons so as thereby to bring the issuance
or sale of any of the Warrants within the provisions of Section 5 of the
Securities Act.
SECTION 9. Obtaining Stock Exchange Listings. The Company will from
time to time take all action which may be necessary so that the Warrant Shares,
immediately upon their issuance upon the exercise of the Warrants, will be
listed on the principal securities exchanges and markets within the United
States of America, if any, on which other shares of Common Stock are then
listed.
SECTION 10. Adjustment of Number of Warrant Shares Issuable. The
number of Warrant Shares issuable upon the exercise of each Warrant is subject
to adjustment from time to time upon the occurrence of the events enumerated in
this Section 10. For purposes of this Section 10, "Common Stock" means shares
now or hereafter authorized of any class of common stock of the Company and any
other stock of the Company, however designated, that has the right (subject to
any prior rights of any class or series of preferred stock) to participate in
any distribution of the assets or earnings of the Company without limit as to
per share amount.
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(a) Adjustment for Change in Capital Stock.
If the Company:
(1) pays a dividend or makes a distribution on its Common Stock in
shares of its Common Stock;
(2) subdivides its outstanding shares of Common Stock into a greater
number of shares;
(3) combines its outstanding shares of Common Stock into a smaller
number of shares;
(4) makes a distribution on its Common Stock in shares of its capital
stock other than Common Stock; or
(5) issues by reclassification of its Common Stock any shares of its
capital stock;
then the number and kind of shares of its capital stock issuable upon exercise
of any Warrant in effect immediately prior to such action shall be
proportionately adjusted so that the holder of any Warrant thereafter exercised
may receive the aggregate number and kind of shares of capital stock of the
Company which such Holder would have owned immediately following such action if
such Warrant had been exercised immediately prior to such action.
The adjustment shall become effective immediately after the record
date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
If, after an adjustment, a Holder of a Warrant upon exercise of it may
receive shares of two or more classes of capital stock of the Company, the
exercise price of each class of capital stock shall thereafter be subject to
adjustment on terms comparable to those applicable to Common Stock in this
Section.
Such adjustment shall be made successively whenever any event listed
above shall occur.
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(b) Adjustment for Rights Issue.
If the Company distributes any rights, options or warrants to all
holders of its Common Stock entitling them to purchase shares of Common Stock
or securities directly or indirectly convertible into or exchangeable for
Common Stock (or options or rights with respect to such securities) at a price
per share less than the current market price per share on the applicable record
date, the number of Warrant Shares issuable upon exercise of one Warrant shall
be adjusted in accordance with the formula:
N1 = N x (O + A)
---------
(O + (A x P))
-
M
where:
N1 = the adjusted number of Warrant Shares issuable
upon exercise of one Warrant.
N = the current number of Warrant Shares issuable upon
exercise of one Warrant.
O = the number of shares of Common Stock outstanding on the
record date.
A = the number of additional shares of Common Stock
offered pursuant to such rights, options or warrants
issuance.
P = the offering price per share of the additional shares.
M = the current market price per share of Common Stock, on
the record date.
The adjustment shall be made successively whenever any such rights,
options or warrants are issued and shall become effective immediately after the
record date for the determination of stockholders entitled to receive the
rights, options or warrants. If at the end of the period during which such
rights, options or warrants are exercisable, not all rights, options or
warrants shall have been exercised, the number of Warrant Shares issuable upon
exercise of the Warrants shall be immediately readjusted to what it would have
been if "A" in the above formula had been the number of shares actually issued.
(c) Adjustment for Other Distributions.
If the Company distributes to all holders of its Common Stock any of
its assets (including but not limited to cash), debt securities, or any rights
or warrants to purchase debt securities, preferred stock, assets or other
securities of the Company, the number of Warrant Shares issuable upon exercise
of one Warrant shall be adjusted in accordance with the formula:
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N1 = N x M
---
M-F
where:
N1 = the adjusted number of Warrant Shares issuable
upon exercise of one Warrant.
N = the current number of Warrant Shares issuable upon
exercise of one Warrant.
M = the current market price per share of Common Stock
on the record date mentioned below.
F = the fair market value on the record date of the
assets, securities, rights or warrants applicable to
one share of Common Stock. The Board of Directors
shall determine the fair market value in good faith.
The adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the
distribution.
This subsection does not apply to distributions of capital stock
referred to in subsection (a) of this Section 10 and to distributions of
rights, options or warrants referred to in subsection (b) of this Section 10.
(d) Adjustment for Common Stock Issue.
If the Company issues shares of Common Stock to Fox Paine & Company,
LLC, or its Affiliates, in their capacity as such (as defined in the
Stockholders' Agreement) for a consideration per share less than the current
market price per share on the date the Company fixes the offering price of such
additional shares, the number of Warrant Shares issuable upon exercise of one
Warrant shall be adjusted in accordance with the formula:
N1 = N x A
------
O + P
-
M
where:
N1 = the adjusted number of Warrant Shares issuable
upon exercise of one Warrant.
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N = the current number of Warrant Shares issuable upon
exercise of one Warrant.
O = the number of shares outstanding immediately prior
to the issuance of such additional shares.
P = the aggregate consideration received for the
issuance of such additional shares.
M = the current market price per share on the date of
sale of such additional shares.
A = the number of shares outstanding immediately after
the issuance of such additional shares.
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
This subsection (d) does not apply to:
(1) any of the transactions described in subsections (b) and (c) of
this Section 10,
(2) the exercise of Warrants, or the conversion or exchange of other
securities convertible or exchangeable for Common Stock,
(3) Common Stock issued upon the exercise of warrants and stock
options outstanding on the Issue Date, or
(4) Common Stock issued in a bona fide underwritten public offering.
(e) Adjustment for Convertible Securities Issue.
If the Company issues any securities convertible into or exchangeable
for Common Stock (other than securities issued in transactions described in
subsections (b), (c) and (d) of this Section 10) to Fox Paine & Company, LLC
its Affiliates, in their capacity as such for a consideration per share of
Common Stock initially deliverable upon conversion or exchange of such
securities less than the current market price per share on the date of issuance
of such securities, the number of Warrant Shares issuable upon exercise of one
Warrant shall be adjusted in accordance with this formula:
N1 = N x O + D
-------
O + P
-
M
12
15
where:
N1 = the adjusted number of Warrant Shares issuable
upon exercise of one Warrant.
N = the then current number of Warrant Shares issuable
upon exercise of one Warrant.
O = the number of shares outstanding immediately prior
to the issuance of such securities.
P = the aggregate consideration received for the issuance
of such securities.
M = the current market price per share on the date of sale
of such securities.
D = the maximum number of shares deliverable upon
conversion or in exchange for such securities at the
initial conversion or exchange rate.
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
If all of the Common Stock deliverable upon conversion or exchange of
such securities have not been issued when such securities are no longer
outstanding, then the number of Warrant Shares issuable upon exercise of one
Warrant shall promptly be readjusted to the number of Warrant Shares issuable
upon exercise of one Warrant which would then be in effect had the adjustment
upon the issuance of such securities been made on the basis of the actual
number of shares of Common Stock issued upon conversion or exchange of such
securities.
This subsection (e) does not apply to convertible securities issued in
a bona fide underwritten public offering.
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(f) Current Market Price.
In Sections 5 and 11 and in subsections (b), (c), (d) and (e) of this
Section 10, the current market price per share of Common Stock on any date is
the average of the Quoted Prices of the Common Stock for 10 consecutive trading
days commencing 15 trading days before the date in question. The "Quoted Price"
of the Common Stock is the last reported sales price of the Common Stock as
reported by NASDAQ, National Market System, or if the Common Stock is listed on
a securities exchange, the last reported sales price of the Common Stock on
such exchange which shall be for consolidated trading if applicable to such
exchange, or if neither so reported or listed, the last reported bid price of
the Common Stock. In the absence of one or more such quotations, the Board of
Directors of the Company shall determine the current market price (i) based on
the most recently completed arm's length transaction between the Company and a
person other than an Affiliate of the Company and the closing of which occurs
on such date or shall have occurred within the three months preceding such
date, (ii) if no such transaction shall have occurred on such date or within
such three month period, the value of the security most recently determined as
of a date within the six months preceding such date by a nationally recognized
financial advisory or appraisal firm selected by the Company's Board of
Directors which is not an Affiliate of the Company (an "Independent Financial
Advisor") or (iii) if neither clause (i) nor (ii) is applicable or at the
election of either the Company or the Holders of at least 50% of the total
Warrants issued under this Agreement (subject to adjustment pursuant to this
Section 10), then the value of the security shall be determined as of such date
by an Independent Financial Advisor.
(g) Consideration Received.
For purposes of any computation respecting consideration received
pursuant to subsections (d) and (e) of this Section 10, the following shall
apply:
(1) in the case of the issuance of shares of Common Stock for cash,
the consideration shall be the amount of such cash, provided that in no
case shall any deduction be made for any commissions, discounts or other
expenses incurred by the Company for any underwriting of the issue or
otherwise in connection therewith;
(2) in the case of the issuance of shares of Common Stock for a
consideration in whole or in part other than cash, the consideration
other than cash shall be deemed to be the fair market value thereof as
determined in good faith by the Board of Directors (irrespective of the
accounting treatment thereof), whose determination shall be conclusive,
and described in a Board resolution;
(3) in the case of the issuance of securities convertible into or
exchangeable for shares, the aggregate consideration received therefor
shall be deemed to be the consideration received by the Company for the
issuance of such securities plus the additional minimum consideration, if
any, to be received by the Company upon the
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conversion or exchange thereof (the consideration in each case to be
determined in the same manner as provided in clauses (1) and (2) of this
subsection).
(h) When De Minimis Adjustment May Be Deferred.
No adjustment in the number of Warrant Shares issuable upon exercise
of one Warrant need be made unless the adjustment would require an increase or
decrease of at least 1% in the number of Warrant Shares issuable upon exercise
of one Warrant. Any adjustments that are not made shall be carried forward and
taken into account in any subsequent adjustment.
All calculations under this Section shall be made to the nearest
1/100th of a share.
(i) When No Adjustment Required.
No adjustment need be made for a transaction referred to in Section 10
(a), (b), (c), (d) or (e) hereof if a Holder actually participates in an
issuance or distribution pursuant to Section 10 (a), (b), (c), (d) or (e)
hereof
No adjustment need be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest.
No adjustment need be made for a change in the par value or no par
value of the Common Stock.
To the extent the Warrants become convertible into cash, no adjustment
need be made thereafter as to the cash. Interest will not accrue on the cash.
(j) Notice of Adjustment.
Whenever the number of Warrant Shares issuable upon exercise of one
Warrant is adjusted, the Company shall provide the notices required by Section
12 hereof.
(k) Notice of Certain Transactions.
If:
(1) The Company takes any action that would require an adjustment in
the number of Warrant Shares issuable upon exercise of one Warrant
pursuant to subsection (a), (b), (c), (d) or (e) of this Section 10 and
if the Company does not arrange for Holders to participate pursuant to
subsection (i) of this Section 10;
(2) The Company takes any action that would require a supplemental
Warrant Agreement pursuant to subsection (l) of this Section 10; or
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18
(3) there is a liquidation or dissolution of the Company,
the Company shall mail to Holders a notice stating the proposed record date for
a dividend or distribution or the proposed effective date of a subdivision,
combination, reclassification, consolidation, merger, transfer, lease,
liquidation or dissolution. The Company shall mail the notice at least 15 days
before such date. Failure to mail the notice or any defect in it shall not
affect the validity of the transaction.
(l) Reorganization of Company.
If the Company consolidates or merges with or into any person, upon
consummation of such transaction the Warrants shall automatically become
exercisable for the kind and amount of securities, cash or other assets which
the Holder would have owned immediately after the consolidation or merger if
the Holder had exercised the Warrant immediately before the effective date of
the transaction. Concurrently with the consummation of such transaction, the
corporation formed by or surviving any such consolidation or merger if other
than the Company, or the person to which such sale or conveyance shall have
been made, shall enter into a supplemental Warrant Agreement so providing and
further providing for adjustments which shall be as nearly equivalent as may be
practical to the adjustments provided for in this Section. The successor
company shall mail to Holders a notice describing the supplemental Warrant
Agreement.
If the issuer of securities deliverable upon exercise of Warrants
under the supplemental Warrant Agreement is an affiliate of the formed or
surviving corporation, that issuer shall join in the supplemental Warrant
Agreement.
If this subsection (l) applies, subsections (a), (b), (c), (d) and (e)
of this Section 10 do not apply.
(m) Company Determination Final.
Any determination that the Company or the Board of Directors must make
pursuant to subsection (a), (c), (d), (e), (f), (g) or (i) of this Section 10
which is made in good faith shall be conclusive.
(n) When Issuance or Payment May Be Deferred.
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In any case in which this Section 10 shall require that an adjustment
in the number of Warrant Shares issuable upon exercise of one Warrant be made
effective as of a record date for a specified event, the Company may elect to
defer until the occurrence of such event (i) issuing to the Holder of any
Warrant exercised after such record date the Warrant Shares and other capital
stock of the Company, if any, issuable upon such exercise over and above the
Warrant Shares and other capital stock of the Company, if any, issuable upon
such exercise on the basis of the current number of Warrant Shares issuable
upon exercise of one Warrant and (ii) paying to such Holder any amount in cash
in lieu of a fractional share pursuant to Section 11; provided, however, that
the Company shall deliver to such Holder a due bill or other appropriate
instrument evidencing such Holder's right to receive such additional Warrant
Shares, other capital stock and cash upon the occurrence of the event requiring
such adjustment.
(o) Adjustment in Exercise Price.
Upon each adjustment of the number of Warrant Shares pursuant to this
Section 10, the Exercise Price for each Warrant outstanding prior to the making
of the adjustment in the number of Warrant Shares shall thereafter be adjusted
to the Exercise Price (calculated to the nearest hundredth) obtained from the
following formula:
E1 = E x N
-
N1
Where
E1 = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
N1 = the adjusted number of Warrant Shares issuable
upon exercise of a Warrant.
N = the number or Warrant shares previously issuable
upon exercise of a Warrant prior to adjustment.
Notwithstanding anything to the contrary, in no event shall the
Exercise Price for a Warrant be reduced below the par value of the Warrant
Share underlying such Warrant.
(p) Form of Warrants.
Irrespective of any adjustments in the number or kind of shares
purchasable upon the exercise of the Warrants, Warrants theretofore or
thereafter issued may continue to express the same price and number and kind of
shares as are stated in the Warrants initially issuable pursuant to this
Agreement.
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20
(q) No Dilution or Impairment.
The Company will not, by amendment of its certificate of incorporation
or through any consolidation, merger, reorganization, transfer of assets,
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 of the
Warrants, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such action as may be necessary or
appropriate (including through a reduction in the par value of Warrant Shares
as necessary) in order to protect the rights of the Holder against dilution or
other impairment.
SECTION 11. Fractional Interests. Any one Warrant may be exercised
only in full and not in part. The Company shall not be required to issue
fractional Warrant Shares on the exercise of Warrants. If more than one Warrant
shall be presented for exercise at the same time by the same Holder, the number
of full Warrant Shares which shall be issuable upon the exercise thereof shall
be computed on the basis of the aggregate number of Warrant Shares purchasable
on exercise of the Warrants so requested to be exercised. If any fraction of a
Warrant Share would, except for the provisions of this Section 11, be issuable
on the exercise of any Warrants (or specified portion thereof) , the Company
shall pay an amount in cash equal to the product of (i) such fraction of a
Warrant Share and (ii) the difference between the current market price of a
share of Common Stock and the Exercise Price.
SECTION 12. Notices to Holders. Upon any adjustment of the number of
Warrant Shares issuable upon exercise of one Warrant pursuant to Section 10,
the Company shall promptly thereafter (i) no later than the delivery of the
audit opinion of a firm of independent public accountants of recognized
standing selected by the Board of Directors of the Company (who may be the
regular auditors of the Company) with respect to the then current fiscal year
of the Company, cause to be filed with the Company a certificate which includes
the report of such firm setting forth the number of Warrant Shares issuable
upon exercise of one Warrant after such adjustment and setting forth in
reasonable detail the method of calculation and the facts upon which such
calculations are based, which certificate shall be conclusive evidence of the
correctness of the matters set forth therein, and (ii) cause to be given to
each of the registered holders of the Warrant Certificates at such holder's
address appearing on the Warrant register written notice of such adjustments by
first class mail, postage prepaid. Where appropriate, such notice may be given
in advance and included as a part of the notice required to be mailed under the
other provisions of this Section 12.
In case:
(a) the Company shall authorize the issuance to all holders of shares
of Common Stock of rights, options or warrants to subscribe for or
purchase shares of Common Stock or of any other subscription rights or
warrants; or
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21
(b) the Company shall authorize the distribution to all holders of
shares of Common Stock of evidences of its indebtedness or assets (other
than cash dividends or cash distributions payable out of consolidated
earnings or earned surplus or dividends payable in shares of Common Stock
or distributions referred to in subsection (a) of Section 10 hereof); or
(c) of any consolidation or merger to which the Company is a party and
for which approval of any shareholders of the Company is required or of
any reclassification or change of Common Stock issuable upon exercise of
the Warrants (other than a change in par value, or from par value to no
par value, or from no par value to par value, or as a result of a
subdivision or combination), or a tender offer or exchange offer for
shares of Common Stock by the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(e) the Company proposes to take any action (other than actions of the
character described in Section 10(a)) which would require an adjustment
of the number of Warrant Shares issuable upon exercise of one Warrant
pursuant to Section 10;
then the Company shall cause to be given to each of the registered holders of
the Warrant Certificates at such holder's address appearing on the Warrant
register, at least 20 days (or 10 days in any case specified in clauses (a) or
(b) above) prior to the applicable record date hereinafter specified, or
promptly in the case of events for which there is no record date, by first
class mail, postage prepaid, a written notice stating (i) the date as of which
the holders of record of shares of Common Stock to be entitled to receive any
such rights, options, warrants or distribution are to be determined, or (ii)
the initial expiration date set forth in any tender offer or exchange offer for
shares of Common Stock by the Company, or (iii) the date on which any such
consolidation, merger, conveyance, dissolution, liquidation or winding up is
expected to become effective or consummated, and the date as of which it is
expected that holders of record of shares of Common Stock shall be entitled to
exchange such shares for securities or other property, if any, deliverable upon
such reclassification, consolidation, merger, conveyance, transfer,
dissolution, liquidation or winding up. The failure to give the notice required
by this Section 12 or any defect therein shall not affect the legality or
validity of any distribution, right, option, warrant, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote upon
any action.
Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as conferring upon the holders thereof
the right to vote or to consent or to receive notice as shareholders in
respect of the meetings of shareholders or the election of Directors of
the Company or any other matter, or any rights whatsoever as shareholders
of the Company.
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SECTION 13. Mandatory Exercise in the Event of an Initial Public
Offering. At the request of the Company, in the event of an underwritten
initial public offering or public offerings (on a cumulative basis) of shares
of Common Stock of the Company pursuant to a registration statement or
registration statements under the Securities Act with aggregate proceeds to the
Company of at least $50.0 million, the Holders shall exercise their Warrants to
purchase Common Stock of the Company upon consummation of such initial public
offering or at such other mutually agreed upon date on or before the date of
consummation of such initial public offering.
SECTION 14. Notices to Company and Holders. Any notice or demand
authorized by this Agreement to be given or made by the registered holder of
any Warrant Certificate to or on the Company shall be sufficiently given or
made when and if deposited in the mail, first class or registered, postage
prepaid, addressed to the office of the Company expressly designated by the
Company at its office for purposes of this Agreement (until the Holders are
otherwise notified in accordance with this Section by the Company), as follows:
Maxxim Medical, Inc.
10300 49th Street North
Clearwater, Florida 33762
Attn: Kenneth W. Davidson
(telecopier no.: 727-561-2180)
with a copy to:
Fox Paine & Company, LLC
950 Tower Lane, Suite 1950
Foster City, California 94404
Attention: Saul A. Fox
(telecopier no: 650-525-1396)
as well as a copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention: Mitchell S. Presser, Esq.
(telecopier no.: 212-403-2000)
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23
GS Mezzanine Partners, L.P.
GS Mezzanine Partners Offshore, L.P.
c/o Goldman, Sachs & Co.
85 Broad Street, 10th Floor
New York, New York 10004
Attn: Ben Adler, Esq.
(telecopier no.: 212-357-5505)
John Hancock Mutual Life Insurance Company
John Hancock Variable Life Insurance Company
Signature 3 Limited
Merrill Lynch International
200 Clarendon Street
Boston, Massachusetts 02117
Attn: Manager, Investment Accounting Division, B-3
(telecopier no.: 617-572-0628)
The Northwestern Mutual Life Insurance Company
720 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Attn: Securities Department
(telecopier no.: 414-299-7124)
Chase Equity Associates, L.P.
c/o Chase Capital Partners
380 Madison Avenue, 12th Floor
New York, New York 10017
Attn: Eric Green
(telecopier no.: 212-622-3101)
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CIBC WMC, Inc.
c/o CIBC Capital Partners
161 Bay Street, 8th Floor
Toronto, Ontario M5J 2S8
Canada
Attn: Managing Director
(telecopier no.: 416-594-8637)
Merrill Lynch, Pierce, Fenner & Smith Incorporated
250 Vesey Street
World Financial Center, North Tower
New York, New York 10281
Attn: Christopher Stout
(telecopier no.: 415-676-3447)
Nationwide Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43215
Attn: Corporate Fixed-Income Securities
(telecopier no.: 614-249-4553)
Deutche Bank AG, New York Branch
c/o Bankers Trust Corporation
130 Liberty Street, 29th Floor
New York, New York 10006
Attn: Kristine Cicardo
(telecopier no.: 212-619-1502)
with an additional copy to:
Deutche Bank AG, New York Branch
31 West 52nd Street
New York, New York 10019
Attn: Mark Fedorcik
(telecopier no.: 212-469-2883)
Credit Suisse First Boston Corporation
11 Madison Avenue
New York, New York 10010
Attn: Richard Gallant
(telecopier no.: 212-325-9136)
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25
Any notice pursuant to this Agreement to be given by the Company to
the registered holder(s) of any Warrant Certificate shall be sufficiently given
when and if deposited in the mail, first class or registered, postage prepaid,
addressed (until the Company is otherwise notified in accordance with this
Section by such holder) to such holder at the address appearing on the Warrant
register of the Company.
SECTION 15. Supplements and Amendments. The Company may from time to
time supplement or amend this Agreement without the approval of any Holders in
order to cure any ambiguity or to correct or supplement any provision contained
herein which may be defective or inconsistent with any other provision herein,
or to make any other provisions in regard to matters or questions arising
hereunder which the Company may deem necessary or desirable and which shall not
in any way adversely affect the interests of the Holders. Any amendment or
supplement to this Agreement that has an adverse effect on the interests of
Holders shall require the written consent of registered holders of two thirds
of the then outstanding Warrant Shares issued or issuable upon exercise of the
Warrants (excluding Warrant Shares held by the Company or any of its
Affiliates). The consent of each Holder of a Warrant affected shall be required
for any amendment pursuant to which the number of Warrant Shares purchasable
upon exercise of Warrants would be decreased (other than in accordance with
Section 10 or 11 hereof).
SECTION 16. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company shall bind and inure to the
benefit of its respective successors and assigns hereunder.
SECTION 17. Termination. This Agreement (except for the restrictions
on transfer of Warrant Shares specified in Section 4) shall terminate at 5:00
p.m., New York City time on November 12, 2004.
SECTION 18. Governing Law. THIS AGREEMENT AND EACH WARRANT CERTIFICATE
ISSUED HEREUNDER SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE
STATE OF NEW YORK AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF SAID STATE.
SECTION 19. Benefits of This Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the Company
and the registered holders of the Warrant Certificates or Warrant Shares any
legal or equitable right, remedy or claim under this Agreement; but this
Agreement shall be for the sole and exclusive benefit of the Company and the
registered holders of the Warrant Certificates and the Warrant Shares. Nothing
herein shall prohibit or limit the Company from entering into an agreement
providing holders of securities which may hereafter be issued by the Company
with such registration rights exercisable at such time or times and in such
manner as the Board of Directors shall deem in the best interests of the
Company so
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long as the performance by the Company of its obligations under such other
agreement will not cause the Company to breach its obligations hereunder to the
Holders.
SECTION 20. Headings. The descriptive headings of the several sections
and paragraphs of this Agreement are inserted for convenience only, do not
constitute a part of this Agreement and shall not affect in any way the
meanings or interpretation of this Agreement.
SECTION 21. Submission to Jurisdiction. If any action, proceeding or
litigation shall be brought by the Purchasers or any Holder in order to enforce
any right or remedy under this Agreement, the Company hereby consents and will
submit, and will cause each of its subsidiaries to submit, to the jurisdiction
of any state or federal court of competent jurisdiction sitting within the area
comprising the Southern District of New York on the date of this Agreement. The
Company hereby irrevocably waives any objection, including, but not limited to,
any objection to the laying of venue or based on the grounds of forum non
conveniens, which it may now or hereafter have to the bringing of any such
action, proceeding or litigation in such jurisdiction.
SECTION 22. Waiver of Jury Trial. THE ISSUER HEREBY WAIVES ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, PROCEEDING OR
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH,
THIS AGREEMENT OR ANY OF THE WARRANTS.
SECTION 23. Service of Process. Nothing herein shall affect the right
of any holder of a security to serve process in any other manner permitted by
law or to commence legal proceedings or otherwise proceed against the Company
in any other jurisdiction.
SECTION 24. Counterparts. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Warrant
Agreement to be duly executed, as of the day and year first above written.
MAXXIM MEDICAL, INC.
by /s/ Kenneth W. Davidson
---------------------------------------
Name: Kenneth W. Davidson
Title: Chairman, President and
Chief Executive Officer
Accepted:
GS MEZZANINE PARTNERS, L.P.
by GS MEZZANINE ADVISORS, L.P.,
its general partner,
by GS MEZZANINE ADVISORS, INC.,
its general partner,
by /s/ Melina Higgins
---------------------------------
Name: Melina Higgins
Title: Attorney-in-fact
GS MEZZANINE PARTNERS
OFFSHORE, L.P.
by GS MEZZANINE ADVISORS
(CAYMAN), L.P., its general partner,
by GS MEZZANINE ADVISORS, INC.,
its general partner,
by /s/ Melina Higgins
---------------------------------
Name: Melina Higgins
Title: Attorney-in-fact
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JOHN HANCOCK MUTUAL LIFE
INSURANCE COMPANY,
by /s/ Stephen J. Blewitt
--------------------------------
Name: Stephen J. Blewitt
Title: Senior Investment Officer
JOHN HANCOCK VARIABLE LIFE
INSURANCE COMPANY,
by /s/ Stephen J. Blewitt
--------------------------------
Name: Stephen J. Blewitt
Title: Senior Investment Officer
SIGNATURE 3 LIMITED,
by JOHN HANCOCK MUTUAL LIFE
INSURANCE COMPANY, as Portfolio
Advisor,
by /s/ Stephen J. Blewitt
--------------------------------
Name: Stephen J. Blewitt
Title: Senior Investment Officer
MERRILL LYNCH INTERNATIONAL,
by JOHN HANCOCK MUTUAL LIFE
INSURANCE COMPANY, as Manager
under that certain Bond Purchase and
Asset Management Agreement dated as of
June 22, 1999,
by /s/ Stephen J. Blewitt
--------------------------------
Name: Stephen J. Blewitt
Title: Senior Investment Officer
26
29
THE NORTHWESTERN MUTUAL
LIFE INSURANCE COMPANY,
by /s/ Gary A. Poliner
--------------------------------
Name: Gary A. Poliner
Title: Authorized Representative
CHASE EQUITY ASSOCIATES, L.P.,
by CHASE CAPITAL PARTNERS, its
general partner
by /s/ John O'Connor
--------------------------------
Name: John O'Connor
Title: General Partner
CIBC WMC, INC.,
by /s/ Ken Kilgour
--------------------------------
Name: Ken Kilgour
Title: Managing Director
MERRILL LYNCH, PIERCE, FENNER
& SMITH INCORPORATED,
by /s/ Christopher K. Stout
--------------------------------
Name: Christopher K. Stout
Title: Director
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30
NATIONWIDE LIFE INSURANCE
COMPANY,
by /s/ Jerry D. Cohen
--------------------------------
Name: Jerry D. Cohen
Title: Authorized Signatory
DEUTSCHE BANK AG,
NEW YORK BRANCH,
by /s/ William Archer
--------------------------------
Name: William Archer
Title: Managing Director
CREDIT SUISSE FIRST BOSTON
CORPORATION,
by /s/ Richard Gallant
--------------------------------
Name: Richard Gallant
Title: Director
28
31
EXHIBIT A
Form of Face of Warrant Certificate
THE WARRANTS REPRESENTED BY THIS CERTIFICATE (AND ANY PREDECESSOR)
WERE ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION
5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THE WARRANTS EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. THE HOLDER OF THE WARRANTS EVIDENCED HEREBY AGREES FOR THE BENEFIT
OF MAXXIM MEDICAL, INC., A TEXAS CORPORATION (THE "COMPANY") THAT (A) SUCH
WARRANTS (AND ANY SHARES ISSUABLE PURSUANT THERETO) MAY BE RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED, ONLY (1) (X) INSIDE THE UNITED STATES (I) TO A PERSON
WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, OR (II) IN ACCORDANCE WITH RULE 144 UNDER THE
SECURITIES ACT, OR (III) PURSUANT TO ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL, IF
THE COMPANY SO REQUESTS), (Y) TO THE COMPANY OR (Z) OUTSIDE THE UNITED STATES
TO A FOREIGN PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER
THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL, IF THE COMPANY SO
REQUESTS) AND (2) IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND
(B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH
IN (A) ABOVE. THE WARRANTS REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO
CERTAIN RESTRICTIONS ON TRANSFERABILITY, AND HAVE THE BENEFIT OF CERTAIN
REGISTRATION RIGHTS, CONTAINED IN THE STOCKHOLDERS' AGREEMENT DATED AS OF
NOVEMBER 12, 1999, AS AMENDED FROM TIME TO TIME, A COPY OF WHICH IS ON FILE AT
THE COMPANY'S PRINCIPAL EXECUTIVE OFFICES.
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EXERCISABLE ON OR BEFORE 5:00 P.M. NEW YORK CITY TIME ON
NOVEMBER 12, 2004.
Private Placement No.: 57777#115 ______ Warrants
Certificate No: W-
Warrant Certificate
Maxxim Medical, Inc.
This Warrant Certificate certifies that __________, or registered
assigns, is the registered holder of Warrants expiring November 12, 2004 (the
"Warrants") to purchase Common Stock, $0.001 par value (the "Common Stock"), of
Maxxim Medical, Inc., a Texas corporation (the "Company"). Each Warrant
entitles the holder upon exercise to receive from the Company on or before 5:00
p.m. New York City time on November 12, 2004, 0.8226 fully paid and
nonassessable shares of Common Stock (a "Warrant Share") at the exercise price
(the "Exercise Price") of $0.01 payable in lawful money of the United States of
America upon surrender of this Warrant Certificate and payment of the Exercise
Price at the office of the Company designated for such purpose, but only
subject to the conditions set forth herein and in the Warrant Agreement
referred to on the reverse hereof. In lieu of exercising the Warrants evidenced
by this Warrant Certificate by paying in full the Exercise Price minus transfer
taxes (if applicable pursuant to Section 6 of the Warrant Agreement), if any,
the holder hereof may, from time to time, convert such Warrants, in whole or in
part, into a number of shares of Common Stock determined by dividing (a) the
aggregate current market price of the number of shares of Common Stock
represented by the Warrants converted, minus the aggregate Exercise Price for
such shares of Common Stock, minus transfer taxes, if any, by (b) the current
market price of one share of Common Stock. The current market price shall be
determined pursuant to Section 10(f) of the Warrant Agreement.
The number of Warrant Shares issuable upon exercise of the Warrants
evidenced hereby is subject to adjustment upon the occurrence of certain events
set forth in the Warrant Agreement.
No Warrant may be exercised after 5:00 p.m., New York City time on
November 12, 2004, and to the extent not exercised by such time such Warrants
shall become void.
Reference is hereby made to the further provisions of this Warrant
Certificate set forth on the reverse hereof and such further provisions shall
for all purposes have the same effect as though fully set forth at this place.
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IN WITNESS WHEREOF, Maxxim Medical, Inc. has caused this Warrant
Certificate to be signed by its Executive Vice President and Chief Financial
Officer and by its Secretary and has caused its corporate seal to be affixed
hereunto or imprinted hereon.
Dated:
By:
-------------------------------------
Name:
Title: Executive Vice President and
Chief Financial Officer
By:
-------------------------------------
Name:
Title: Secretary
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Form of Reverse Side of Warrant Certificate
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants expiring November 12, 2004, entitling the holder
hereof on exercise to receive 0.8226 shares of Common Stock, $0.001 par value,
of the Company (the "Common Stock") per Warrant exercised, and are issued or to
be issued pursuant to a Warrant Agreement, dated as of November 12, 1999 (the
"Warrant Agreement"), duly executed and delivered by the Company, which Warrant
Agreement is hereby incorporated by reference in and made a part of this
instrument and is hereby referred to for a description of the rights,
limitation of rights, obligations, duties and immunities thereunder of the
Company and the holders (the words "holders" or "holder" meaning the registered
holders or registered holder) of the Warrants. A copy of the Warrant Agreement
may be obtained by the holder hereof upon written request to the Company.
Warrants may be exercised at any time on or before November 12, 2004.
The holder of Warrants evidenced by this Warrant Certificate may exercise them
by surrendering this Warrant Certificate, with the form of election to purchase
set forth hereon properly completed and executed, together with payment of the
Exercise Price in cash at the office of the Company designated for such
purpose. In lieu of exercising the Warrants evidenced by this Warrant
Certificate by paying in full the Exercise Price and transfer taxes (if
applicable pursuant to Section 6 of the Warrant Agreement), if any, the holder
of the Warrants may, from time to time, convert the Warrants evidenced by this
Warrant Certificate, in whole or in part, into a number of shares of Common
Stock determined by dividing (a) the aggregate current market price of the
number of shares of Common Stock represented by the Warrants converted, minus
the aggregate Exercise Price for such shares of Common Stock and transfer
taxes, if any, by (b) the current market price of one share of Common Stock.
The current market price shall be determined pursuant to Section 10(f) of the
Warrant Agreement. In the event that upon any exercise of Warrants evidenced
hereby the number of Warrants exercised shall be less than the total number of
Warrants evidenced hereby, there shall be issued to the holder hereof or such
holder's assignee a new Warrant Certificate evidencing the number of Warrants
not exercised.
The Warrant Agreement provides that upon the occurrence of certain
events the number of Warrant Shares issuable upon exercise of one Warrant set
forth on the face hereof may, subject to certain conditions, be adjusted. No
fractions of a share of Common Stock will be issued upon the exercise of any
Warrant, but the Company will pay the cash value thereof determined as provided
in the Warrant Agreement.
Warrant Certificates, when surrendered at the office of the Company by
the registered holder thereof in person or by legal representative or attorney
duly authorized in writing, may be exchanged, in the manner and subject to the
limitations
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provided in the Warrant Agreement, but without payment of any service charge,
for another Warrant Certificate or Warrant Certificates of like tenor
evidencing in the aggregate a like number of Warrants.
Upon due presentation for registration of transfer of this Warrant
Certificate at the office of the Company a new Warrant Certificate or Warrant
Certificates of like tenor and evidencing in the aggregate a like number of
Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided in the Warrant Agreement,
without charge except for any tax or other governmental charge imposed in
connection therewith.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, of any distribution to the holder(s) hereof, and for all other
purposes, and the Company shall not be affected by any notice to the contrary.
Neither the Warrants nor this Warrant Certificate entitles any holder hereof to
any rights of a stockholder of the Company.
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ASSIGNMENT FORM
If you, the holder of this Warrant Certificate, want to assign all or
a portion of the Warrants evidenced hereby, fill in the form below and have
your signature guaranteed:
I or we assign and transfer the Warrants to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Print or type name, address and zip code and social
security or tax ID number of assignee)
and irrevocably appoint _________________________________ agent to transfer the
Warrants evidenced hereby on the books of the Company. The agent may substitute
another to act for him.
Date: Signed:
--------------------------------- -----------------------------
(Signed exactly as your name
appears on the other side of
this Warrant Certificate)
Signature Guarantee:
---------------------------------
In connection with any transfer of the Warrants evidenced by this
Warrant Certificate occurring prior to the date which is the earlier of (a) the
date of the declaration by the Securities and Exchange Commission of the
effectiveness of a registration statement under the Securities Act of 1933, as
amended (the "Securities Act") covering resales of this Warrant (which
effectiveness shall not have been suspended or terminated at the date of the
transfer) and (b) [__________ , 2001], the undersigned confirms that it has not
utilized any general solicitation or general advertising in connection with the
transfer and that the Warrants evidenced by the Warrant Certificate is being
transferred:
Check One
(1) ______ to the Company or a subsidiary thereof; or
(2) ______ pursuant to and in compliance with Rule 144A under the
Securities Act; or
(3) ______ to an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act)
that has furnished to the Company a signed letter
containing certain representations and agreements (the
form of which appears below); or
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(4) ______ outside the United States to a "foreign person" in
compliance with Rule 904 of
(5) ______ Regulation S under the Securities Act; or pursuant to the
exemption from registration provided by Rule 144 under the
Securities Act; or
(6) ______ pursuant to another available exemption from the
registration requirements of the Securities Act.
Unless one of the boxes is checked, the Company will refuse to register any of
the Warrants evidenced by this Warrant Certificate in the name of any person
other than the registered holder thereof; provided that if box (3) , (4), (5)
or (6) is checked, the Company may require, prior to registering any such
transfer of the Notes, in its sole discretion, such legal opinions,
certifications (including an investment letter in the case of box (3) or (4))
and other information as the Company has reasonably requested to confirm that
such transfers being made pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act.
If none of the foregoing boxes is checked, the Company shall not be obligated
to register the Warrants evidenced by this Warrant Certificate in the name of
any person other than the holder hereof unless and until the conditions to any
such transfer of registration set forth herein shall have been satisfied.
Date:
----------------------------------
Signed:
--------------------------------
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee:
----------------------------------------------
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TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing the
Warrant(s) for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
Date:
---------------------------------
Signed:
-------------------------------
NOTICE: To be executed by an executive officer
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FORM OF LETTER TO BE COMPLETED
BY PURCHASER IF (3) ABOVE IS CHECKED
Ladies and Gentlemen:
1. The undersigned understands that any subsequent transfer of the
Warrants is subject to certain restrictions and conditions set forth in the
Warrants and in the Warrant Agreement and the undersigned agrees to be bound
by, and not to resell, pledge or otherwise transfer the Warrants except in
compliance with, such restrictions and conditions and the Securities Act.
2. The undersigned understands that the offer and sale of the Warrants
have not been registered under the Securities Act, and that the Warrants may
not be offered or sold except as permitted in the following sentence. The
undersigned agrees, on its own behalf and on behalf of any accounts for which
it is acting as hereinafter stated, that if it should sell, pledge or otherwise
transfer any Warrants it will do so only (1) (x) inside the United States to a
person who the seller reasonably believes is a qualified institutional buyer
within the meaning of Rule 144A under the Securities Act in a transaction
meeting the requirements of Rule 144A, or in accordance with Rule 144 under the
Securities Act, or pursuant to another exemption from the registration
requirements of the Securities Act (and based upon an opinion of counsel, if
the company so requests), (y) to the Company or (z) outside the United States
to a foreign person in a transaction meeting the requirements of Rule 904 under
the Securities Act (and based upon an opinion of counsel, if the Company so
requests) and (2) in each case, in accordance with the applicable securities
laws of any state of the United States or any other applicable jurisdiction,
and the undersigned further agrees to provide to any person purchasing any of
the Warrants from us a notice advising such purchaser that resales of the
Warrants are restricted as stated herein.
3. The undersigned understands that, on any proposed resale of any
Warrants, it may be required to furnish the Company such certification and
other information as the Company may reasonably require to confirm that the
proposed sale complies with the foregoing restrictions. The undersigned further
understands that the Warrants purchased by it will bear a legend to the
foregoing effect.
4. The undersigned is an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) and (7) under the Securities Act) and have
such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Warrants,
and the undersigned and any accounts for which it is acting are each able to
bear the economic risk of our or its investment, as the case may be.
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5. The undersigned is acquiring the Warrants purchased by us for our
account or for one or more accounts (each of which is an institutional
"accredited investor") as to each of which the undersigned exercises sole
investment discretion.
Date:
---------------------------------
Signed:
-------------------------------
NOTICE: To be signed by an executive officer
Form of Election to Purchase
(To Be Executed Upon Exercise Of Warrant)
The undersigned hereby irrevocably elects to exercise the Warrant,
represented by this Warrant Certificate, to receive shares of Common Stock and
herewith (check item)
(i) tenders payment for such shares to the order of Maxxim Medical,
Inc. in the amount of $ in accordance with the terms hereof; or
(ii) converts the Warrants evidenced by this Warrant Certificate, in
whole or in part, into a number of shares of Common Stock determined by
dividing (a) the aggregate current market price of the number of shares
of Common Stock represented by such Warrant, minus the aggregate Exercise
Price for such shares of Common Stock and transfer taxes, if any, by (b)
the current market price of one Share.
The undersigned requests that a certificate for such shares be
registered in the name of _______________________________, whose address is
_________________________________, and that such shares be delivered to
___________________________,whose address is _____________________________.
If said number of shares is less than all of the shares of Common
Stock purchasable hereunder, the undersigned requests that a new Warrant
Certificate representing the remaining balance of such shares be registered in
the name of _______________________, whose address is _______________________,
and that such Warrant Certificate be delivered to ______________________, whose
address is _______________________.
Signature:
-----------------------------
Date:
----------------------------------
Signature Guaranteed:
------------------
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