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EXHIBIT 3.1
APPENDIX B
WARRANT AGREEMENT
AGREEMENT, dated as of _________________ 2000 among Microsulis
Medical Corporation (formerly named AccuMed International, Inc.), a Delaware
corporation (the "Company"), and the persons named on Schedule 1 (the
"Warrantholders").
W I T N E S S E T H
WHEREAS, pursuant to the Agreement and Plan of Merger dated
November 16, 1999 and amended December 16, 1999, December 21, 1999, and December
22, 1999 among the Company, AccuMed Acquisition Subsidiary, Inc. and Microsulis
Corporation (the "Merger Agreement"), the Company is required to issue to the
Warrantholders warrants (the "Warrants") to purchase an aggregate of up to
3,014,646 shares (the "Warrant Shares") of the Company's Common Stock, par value
$0.01 per share (the "Common Stock"), each Warrant exercisable to purchase one
share of the Common Stock;
NOW THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth and for the purpose of defining the terms and
provisions of the Warrants and the certificates representing the Warrants and
the respective rights and obligations thereunder of the Company, and the holders
of certificates representing the Warrants, the parties hereto agree as follows:
SECTION 1. Definitions. As used herein, the following terms shall
have the following meanings, unless the context shall otherwise require:
(a) "Common Stock" shall mean common stock of the Company,
whether now or hereafter authorized, which has the right to participate in the
distributions of earnings and assets of the Company without limit as to amount
or percentage, which at the date hereof consists of 50,000,000 authorized shares
of Common Stock, par value $.01 per share.
(b) "Corporate Office" shall mean the office of the Company at
which at any particular time its principal business shall be administered, which
office is located at the date hereof at 920 North Franklin Street, Suite 402,
Chicago, Illinois 60610.
(c) "Exercise Date" shall mean, as to any Warrant, the date on
which the Company shall have received both (a) the Warrant Certificate
representing such Warrant, with the exercise form thereon properly completed and
duly executed by the Registered Holder thereof or its attorney duly authorized
in writing, and (b) payment in cash, or by official bank or
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certified check made payable to the Company, of an amount in lawful money of the
United States of America equal to the applicable Purchase Price.
(d) "Initial Warrant Exercise Date" shall mean _____________,
2000.
(e) "Market Price" shall mean (i) the average closing bid price
of the Common Stock, for twenty (20) consecutive trading days ending on the
Calculation Date as reported by Nasdaq, if the Common Stock is traded on the
Nasdaq SmallCap Market, or (ii) the average last reported sales price of the
Common Stock, for twenty (20) consecutive trading days ending on the Calculation
Date, as reported by the primary exchange on which the Common Stock is traded,
if the Common Stock is traded on a national securities exchange, or by Nasdaq,
if the Common Stock is traded on the Nasdaq National Market.
(f) "Purchase Price" shall mean the purchase price to be paid
upon exercise of each Warrant in accordance with the terms hereof, which price
shall be $6.75 per share subject to adjustment from time to time pursuant to the
provisions of Section 8 hereof.
(g) "Redemption Price" shall mean the price at which the Company
may, at its option in accordance with the terms hereof, redeem the Warrants
which price shall be $0.25 per Warrant.
(h) "Registered Holder" shall mean the person in whose name any
certificate representing applicable Warrants shall be registered on the books
maintained by the Company.
(i) "Registerable Securities" shall have the meaning set forth in
Section 10.1.
(j) "Transfer Agent" shall mean First Chicago Trust Company of
New York, as the Company's transfer agent for the Common Stock, or its
authorized successor, as such.
(k) "Warrant Expiration Date" shall mean 5:00 P.M. (New York
time) on _______________, 2005, or such earlier date as the Warrants shall be
redeemed; provided that if either of such date shall in the State of New York be
a holiday or a day on which banks are authorized to close, then 5:00 P.M. (New
York time) on the next following day which in the State of New York is not a
holiday or a day on which banks are authorized to close.
SECTION 2. Warrants and Issuance of Warrant Certificates.
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(a) A Warrant shall initially entitle the Registered Holder of
the Warrant Certificate representing such Warrant to purchase one share of
Common Stock upon the exercise thereof, in accordance with the terms hereof,
subject to modification and adjustment as provided in Section 8.
(b) From time to time, up to the Warrant Expiration Date, the
Company shall execute and deliver stock certificates in required whole number
denominations representing up to an aggregate of 3,014,646 shares of Common
Stock, subject to adjustment as described herein, upon the exercise of Warrants
in accordance with this Agreement.
(c) From time to time, up to the Warrant Expiration Date, the
Company shall execute and deliver Warrant Certificates in required whole number
denominations to the persons entitled thereto in connection with any transfer or
exchange permitted under this Agreement; provided that no Warrant Certificates
shall be issued except (i) those initially issued hereunder, (ii) those issued
on or after the Initial Warrant Exercise Date, upon the exercise of fewer than
all Warrants represented by any Warrant Certificate, to evidence any unexercised
Warrants held by the exercising Registered Holder, (iii) those issued upon any
transfer or exchange pursuant to Section 6; (iv) those issued in replacement of
lost, stolen, destroyed or mutilated Warrant Certificates pursuant to Section 7;
and (v) at the option of the Company, in such form as may be approved by the its
Board of Directors, to reflect (a) any adjustment or change in the Purchase
Price or Target Price (as defined in Section 9) or the number of shares of
Common Stock purchasable upon exercise of the Warrants, made pursuant to Section
8 hereof and (b) other modifications approved by Warrantholders in accordance
with Section 17 hereof.
SECTION 3. Form and Execution of Warrant Certificates. (a) The
Warrant Certificates shall be substantially in the form annexed hereto as
Exhibit A (the provisions of which are hereby incorporated herein) and may have
such letters, numbers or other marks of identification or designation and such
legends, summaries or endorsements printed, lithographed, engraved or typed
thereon as the Company may deem appropriate and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply with any law or to
conform to usage. The Warrant Certificates shall be dated the date of issuance
thereof (whether upon initial issuance, transfer, exchange or in lieu of
mutilated, lost, stolen, or destroyed Warrant Certificates) and issued in
registered form. Warrants shall be numbered serially with the letter W.
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(b) Warrant Certificates shall be executed on behalf of the
Company by its Chairman of the Board, Chief Executive Officer or Chief Financial
Officer and by its Secretary or an Assistant Secretary, by manual signatures or
by facsimile signatures printed thereon, and shall have imprinted thereon a
facsimile of the Company's seal. In case any officer of the Company who shall
have signed any of the Warrant Certificates shall cease to be such officer of
the Company before the date of issuance of the Warrant Certificates and issue
and delivery thereof, such Warrant Certificates may nevertheless be issued and
delivered with the same force and effect as though the person who signed such
Warrant Certificates had not ceased to be such officer of the Company. After
execution by the Company, Warrant Certificates shall be delivered to the
Registered Holder.
SECTION 4. Exercise.
(a) Each Warrant may be exercised by the Registered Holder
thereof at any time on or after the Initial Exercise Date, but not after the
Warrant Expiration Date, upon the terms and subject to the conditions set forth
herein and in the applicable Warrant Certificate. A Warrant shall be deemed to
have been exercised immediately prior to the close of business on the Exercise
Date and the person entitled to receive the securities deliverable upon such
exercise shall be treated for all purposes as the holder upon exercise thereof
as of the close of business on the Exercise Date. As soon as practicable on or
after the Exercise Date the Company shall deposit the proceeds received from the
exercise of a Warrant, and promptly after clearance of checks received in
payment of the Purchase Price pursuant to such Warrants, cause to be issued and
delivered by the Transfer Agent, to the person or persons entitled to receive
the same, a certificate or certificates for the securities deliverable upon such
exercise, (plus a certificate for any remaining unexercised Warrants of the
Registered Holder).
SECTION 5. Reservation of Shares; Listing; Payment of Taxes; etc.
(a) The Company covenants that it will at all times reserve and keep available
out of its authorized Common Stock, solely for the purpose of issue upon
exercise of Warrants, such number of shares of Common Stock as shall then be
issuable upon the exercise of all outstanding Warrants. The Company covenants
that all shares of Common Stock which shall be issuable upon exercise of the
Warrants and payment of the Purchase Price pursuant to the terms hereof shall,
at the time of delivery, be duly and validly issued, fully paid, nonassessable
and free from all taxes, liens and charges with respect to the issue thereof
(other than those which the Company shall promptly pay or discharge).
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(b) The Company will use reasonable efforts to obtain appropriate
approvals or registrations (in such states as requested in writing by or on
behalf of any Warrantholders) under state "blue sky" securities laws or
compliance with exemption requirements (if such exemptions are not self
executing) with respect to the exercise of the Warrants; provided, however, that
the Company shall not be obligated to file any general consent to service of
process or qualify as a foreign corporation in any jurisdiction. With respect to
any such securities laws, however, Warrants may not be exercised by, or shares
of Common Stock issued to, any Registered Holder in any state in which such
exercise would be unlawful.
(c) The Company shall pay all documentary, stamp or similar taxes
and other governmental charges that may be imposed with respect to the issuance
of Warrants, or the issuance, or delivery of any shares upon exercise of the
Warrants; provided, however, that if the shares of Common Stock are to be
delivered in a name other than the name of the Registered Holder of the Warrant
Certificate representing any Warrant being exercised, then no such delivery
shall be made unless (i) the person requesting the same has paid to the Company
the amount of transfer taxes or charges incident thereto, if any and (ii) the
Registered Holder has provided documentation satisfactory to the Company's
counsel that such issuance is not in violation of applicable Federal and state
securities laws.
SECTION 6. Exchange and Registration of Transfer.
Subject to the restrictions on transfer contained in the Warrant
Certificates and the [Stockholders Agreement (the "Stockholders Agreement")]
between the Company and certain of the initial Warrantholders:
(a) Warrant Certificates may be exchanged for other Warrant
Certificates representing an equal aggregate number of Warrants of the same
class or may be transferred in whole or in part. Warrant Certificates to be
exchanged shall be surrendered to the Company at its Corporate Office, and upon
satisfaction of the terms and provisions hereof, the Company shall execute,
issue and deliver in exchange therefor the Warrant Certificate or Certificates
which the Registered Holder making the exchange shall be entitled to receive.
(b) The Company shall keep at its office books in which, subject
to such reasonable regulations as it may prescribe, it shall register Warrant
Certificates and the
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transfer thereof in accordance with its regular practice. Upon due presentment
for registration of transfer of any Warrant Certificate at its Corporate Office,
the Company shall execute, issue and deliver to the transferee or transferees a
new Warrant Certificate or Certificates representing an equal aggregate number
of Warrants.
(c) With respect to all Warrant Certificates presented for
registration of transfer, or for exchange or exercise, the subscription form on
the reverse thereof shall be duly endorsed, or be accompanied by a written
instrument or instruments of transfer and subscription, in form satisfactory to
the Company, duly executed by the Registered Holder or its attorney-in-fact duly
authorized in writing provided to the Company.
(d) The Company may require payment by such Registered Holder of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith.
(e) All Warrant Certificates surrendered for exercise or for
exchange in case of mutilated Warrant Certificates shall be promptly cancelled
by the Company and thereafter retained by the Company until termination of this
Agreement or, with the prior written consent of Registered Holder be disposed of
or destroyed.
(f) Prior to due presentment for registration of transfer
thereof, the Company may deem and treat the Registered Holder of any Warrant
Certificate as the absolute owner thereof and of each Warrant represented
thereby (notwithstanding any notations of ownership or writing thereon made by
anyone other than a duly authorized officer of the Company for all purposes and
shall not be affected by any notice to the contrary.
SECTION 7. Loss or Mutilation. Upon receipt by the Company of
evidence satisfactory to it of the ownership of and loss, theft, destruction or
mutilation of any Warrant Certificate and (in case of loss, theft or
destruction) of indemnity satisfactory to the Company, and (in the case of
mutilation) upon surrender and cancellation thereof, the Company shall execute
and (in the absence of notice to the Company that the Warrant Certificate has
been acquired by a bonafide purchaser) and deliver to the Registered Holder in
lieu thereof a new Warrant Certificate of like tenor representing an equal
aggregate number of Warrants. Applicants for a substitute Warrant Certificate
shall comply with such other reasonable regulations and pay such other
reasonable charges as the Company may prescribe.
SECTION 8. Adjustment of Exercise Price and Number
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of Shares of Common Stock or Warrants.
(a) Subject to the exceptions referred to in Section 8(g) below,
in the event the Company shall, at any time or from time to time after the date
hereof, sell any shares of Common Stock for a consideration per share less than
the Market Price per share of the Common Stock on the date of the sale or issue
any shares of Common Stock as a stock dividend to the holders of Common Stock,
or subdivide or combine the outstanding shares of Common Stock into a greater or
lesser number of shares (any such sale, issuance, subdivision or combination
being herein called a "Change of Shares"), then, and thereafter upon each
further Change of Shares, the Purchase Price in effect immediately prior to such
Change of Shares shall be changed to a price (including any applicable fraction
of a cent) determined by multiplying the Purchase Price in effect immediately
prior thereto by a fraction, the numerator of which shall be the sum of the
number of shares of Common Stock outstanding immediately prior to the issuance
of such additional shares and the number of shares of Common Stock which the
aggregate consideration received (determined as provided in subsection 8(f)(F)
below), if any, for the issuance of such additional shares would purchase at the
Market Price per share of Common Stock, and the denominator of which shall be
the sum of the number of shares of Common Stock outstanding immediately after
the issuance of such additional shares. Such adjustment shall be made
successively whenever such an issuance is made.
Upon each adjustment of the Purchase Price pursuant to this
Section 8, the total number of shares of Common Stock purchasable upon the
exercise of each Warrant shall (subject to the provisions contained in Section
8(b) hereof) be such number of shares (calculated to the nearest tenth)
purchasable at the Purchase Price immediately prior to such adjustment
multiplied by a fraction, the numerator of which shall be the Purchase Price in
effect immediately prior to such adjustment and the denominator of which shall
be the Purchase Price in effect immediately after such adjustment.
(b) The Company may elect, upon any adjustment of the Purchase
Price hereunder, to adjust the number of Warrants outstanding, in lieu of the
adjustment in the number of shares of Common Stock purchasable upon the exercise
of each Warrant as hereinabove provided, so that each Warrant outstanding after
such adjustment shall represent the right to purchase one share of Common Stock.
Each Warrant held of record prior to such adjustment of the number of Warrants
shall become that number of Warrants (calculated to the nearest tenth)
determined by multiplying the number one by a fraction, the numerator of which
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shall be the Purchase Price in effect immediately prior to such adjustment and
the denominator of which shall be the Purchase Price in effect immediately after
such adjustment. Upon each adjustment of the number of Warrants pursuant to this
Section 8, the Company shall, as promptly as practicable, cause to be
distributed to each Registered Holder of Warrant Certificates on the date of
such adjustment Warrant Certificates evidencing, subject to Section 10 hereof,
the number of additional Warrants to which such Registered Holder shall be
entitled as a result of such adjustment or, at the option of the Company, cause
to be distributed to such Registered Holder in substitution and replacement for
the Warrant Certificates held by it prior to the date of adjustment (and upon
surrender thereof, if required by the Company) new Warrant Certificates
evidencing the number of Warrants to which such Registered Holder shall be
entitled after such adjustment.
(c) In case of any reclassification, capital reorganization or
other change of outstanding shares of Common Stock, or in case of any
consolidation or merger of the Company with or into another corporation (other
than a consolidation or merger in which the Company is the continuing
corporation and which does not result in any reclassification, capital
reorganization or other change of outstanding shares of Common Stock), or in
case of any sale or conveyance to another corporation of the property of the
Company as, or substantially as, an entirety (other than a sale/leaseback,
mortgage or other financing transaction), the Company shall cause effective
provision to be made so that each holder of a Warrant then outstanding shall
have the right thereafter, by exercising such Warrant, to purchase the kind and
number of shares of stock or other securities or property (including cash)
receivable upon such reclassification, capital reorganization or other change,
consolidation, merger, sale or conveyance by a holder of the number of shares of
Common Stock that might have been purchased upon exercise of such Warrant
immediately prior to such reclassification, capital reorganization or other
change, consolidation, merger, sale or conveyance. Any such provision shall
include provision for adjustments that shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Section 8. The foregoing
provisions shall similarly apply to successive reclassifications, capital
reorganizations and other changes of outstanding shares of Common Stock and to
successive consolidations, mergers, sales or conveyances.
(d) Irrespective of any adjustments or changes in the Purchase
Price or the number of shares of Common Stock purchasable upon exercise of the
Warrants, the Warrant Certificates theretofore and thereafter issued shall,
unless the Company shall exercise its option to issue new Warrant
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Certificates pursuant to Section 2(c) hereof, continue to express the Purchase
Price per share and the number of shares purchasable thereunder as the Purchase
Price per share, and the number of shares purchasable were expressed in the
Warrant Certificates when the same were originally issued.
(e) After each adjustment of the Purchase Price pursuant to this
Section 8, the Company will promptly prepare a certificate signed by the
Chairman, Chief Executive Officer or Chief Financial Officer, and by the
Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary,
of the Company setting forth: (i) the Purchase Price as so adjusted, (ii) the
number of shares of Common Stock purchasable upon exercise of each Warrant after
such adjustment, and, if the Company shall have elected to adjust the number of
Warrants, the number of Warrants to which the registered holder of each Warrant
shall then be entitled, and (iii) a brief statement of the facts accounting for
such adjustment. The Company will promptly cause a brief summary thereof to be
sent by ordinary first class mail to each Registered Holder of Warrants at its
last address as it shall appear on the registry books of the Company. No failure
to mail such notice nor any defect therein or in the mailing thereof shall
affect the validity thereof except as to the holder to whom the Company failed
to mail such notice, or except as to the holder whose notice was defective. The
affidavit of the Secretary or an Assistant Secretary of the Company that such
notice has been mailed shall, in the absence of fraud, be prima facie evidence
of the facts stated therein.
(f) For purposes of Section 8(a) and 8(b) hereof, the following
provisions (A) to (F) shall also be applicable:
(A) The number of shares of Common Stock outstanding at
any given time shall include shares of Common Stock owned or held
by or for the account of the Company and the sale or issuance of
such treasury shares or the distribution of any such treasury
shares shall not be considered a Change of Shares for purposes of
said sections.
(B) No adjustment of the Purchase Price shall be made
unless such adjustment would require an increase or decrease of
at least $.10 in such price; provided that any adjustments which
by reason of this clause (B) are not required to be made shall be
carried forward and shall be made at the time of and together
with the next subsequent adjustment which, together with any
adjustment(s) so carried forward, shall require an increase or
decrease of at least $.10 in the Purchase Price then in effect
hereunder.
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(C) In case of (1) the sale by the Company for cash of any
rights or warrants to subscribe for or purchase, or any options
for the purchase of, Common Stock or any securities convertible
into or exchangeable for Common Stock without the payment of any
further consideration other than cash, if any (such convertible
or exchangeable securities being herein called "Convertible
Securities"), or (2) the issuance by the Company, without the
receipt by the Company of any consideration therefor, of any
rights or warrants to subscribe for or purchase, or any options
for the purchase of, Common Stock or Convertible Securities, in
each case, if (and only if) the consideration payable to the
Company upon the exercise of such rights, warrants or options
shall consist of cash, whether or not such rights, warrants or
options, or the right to convert or exchange such Convertible
Securities, are immediately exercisable, and the price per share
for which Common Stock is issuable upon the exercise of such
rights, warrants or options or upon the conversion or exchange of
such Convertible Securities (determined by dividing (x) the
minimum aggregate consideration payable to the Company upon the
exercise of such rights, warrants or options, plus the
consideration received by the Company for the issuance or sale of
such rights, warrants or options, plus, in the case of such
Convertible Securities, the minimum aggregate amount of
additional consideration, if any, other than such Convertible
Securities, payable upon the conversion or exchange thereof, by
(y) the total maximum number of shares of Common Stock issuable
upon the exercise of such rights, warrants or options or upon the
conversion or exchange of such Convertible Securities issuable
upon the exercise of such rights, warrants or options) is less
than the Market Price of the Common Stock on the date of the
issuance or sale of such rights, warrants or options, then the
total maximum number of shares of Common Stock issuable upon the
exercise of such rights, warrants or options or upon the
conversion or exchange of such Convertible Securities (as of the
date of the issuance or sale of such rights, warrants or options)
shall be deemed to be outstanding shares of Common Stock for
purposes of Sections 8(a) and 8(b) hereof and shall be deemed to
have been sold for cash in an amount equal to such price per
share.
(D) In case of the sale by the Company for cash of any
Convertible Securities, whether or not the right of conversion or
exchange thereunder is immediately
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exercisable, and the price per share for which Common Stock is
issuable upon the conversion or exchange of such Convertible
Securities (determined by dividing (x) the total amount of
consideration received by the Company for the sale of such
Convertible Securities, plus the minimum aggregate amount of
additional consideration, if any, other than such Convertible
Securities, payable upon the conversion or exchange thereof, by
(y) the total maximum number of shares of Common Stock issuable
upon the conversion or exchange of such convertible Securities)
is less than the Market Price of the Common Stock on the date of
the sale of such Convertible Securities, then the total maximum
number of shares of Common Stock issuable upon the conversion or
exchange of such Convertible Securities (as of the date of the
sale of such Convertible Securities) shall be deemed to be
outstanding shares of Common Stock for purposes of Sections 8(a)
and 8(b) hereof and shall be deemed to have been sold for cash in
an amount equal to such price per share.
(E) If the exercise or purchase price provided for in any
right, warrant or option referred to in (C) above, or the rate at
which any Convertible Securities referred to in (C) or (D) above
are convertible into or exchangeable for Common Stock, shall
change at any time (other than under or by reason of provisions
designed to protect against dilution), the Purchase Price then in
effect hereunder shall forthwith be readjusted to such Purchase
Price as would have obtained (1) had the adjustments made upon
the issuance or sale of such rights, warrants, options or
Convertible Securities been made upon the basis of the issuance
of only the number of shares of Common Stock theretofore actually
delivered (and the total consideration received therefor) upon
the exercise of such rights, warrants or options or upon the
conversion or exchange of such Convertible Securities, (2) had
adjustments been made on the basis of the Purchase Price as
adjusted under clause (1) for all transactions (which would have
affected such adjusted Purchase Price) made after the issuance or
sale of such rights, warrants, options or Convertible Securities,
and (3) had any such rights, warrants, options or Convertible
Securities then still outstanding been originally issued or sold
at the time of such change. On the expiration of any such right,
warrant or option or the termination of any such right to convert
or exchange any such Convertible Securities, the Purchase Price
then in effect hereunder shall forthwith be readjusted to such
Purchase Price as would
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have obtained (a) had the adjustments made upon the issuance or
sale of such rights, warrants, options or Convertible Securities
been made upon the basis of the issuance of only the number of
shares of Common Stock theretofore actually delivered (and the
total consideration received therefor) upon the exercise of such
rights, warrants or options or upon the conversion or exchange of
such Convertible Securities and (b) had adjustments been made on
the basis of the Purchase Price as adjusted under clause (a) for
all transactions (which would have affected such adjusted
Purchase Price) made after the issuance or sale of such rights,
warrants, options or Convertible Securities.
(F) In case of the sale for cash of any shares of Common
Stock, any Convertible Securities, any rights or warrants to
subscribe for or purchase, or any options for the purchase of,
Common Stock or Convertible Securities, the consideration
received by the Company therefore shall be deemed to be the gross
sales price therefor without deducting therefrom any expense paid
or incurred by the Company or any underwriting discounts or
commissions or concessions paid or allowed by the Company in
connection therewith.
(g) No adjustment to the Purchase Price of the Warrants or to the
number of shares of Common Stock purchasable upon the exercise of each Warrant
will be made, however,
(i) upon the exercise of any of the options presently
outstanding whether issued pursuant to the Merger Agreement or
under the Company's Stock Option Plans (the "Plans") for
officers, directors and certain other key personnel of, and
consultants to, the Company; or
(ii) upon the grant or exercise of any other options which may
hereafter be granted or exercised under the Plans or under any
other employee benefit plan of the Company; or
(iii) upon the issuance or sale of Common Stock or Convertible
Securities upon the exercise of any rights or warrants to
subscribe for or purchase, or any options for the purchase of,
Common Stock or Convertible Securities, whether or not such
rights, warrants or options were outstanding on the date of the
original sale of the Warrants or were thereafter issued or sold;
or
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(iv) upon the issuance or sale of Common Stock upon conversion
or exchange of any Convertible Securities, whether or not any
adjustment in the Purchase Price was made or required to be made
upon the issuance or sale of such Convertible Securities and
whether or not such Convertible Securities were outstanding on
the date of the original sale of the Warrants or were thereafter
issued or sold; or
(vi) upon any amendment to or change in the terms of any
rights or warrants to subscribe for or purchase, or options for
the purchase of, Common Stock or Convertible Securities or in the
terms of any Convertible Securities, including, but not limited
to, any extension of any expiration date of any such right,
warrant or option, any change in any exercise or purchase price
provided for in any such right, warrant or option, any extension
of any date through which any Convertible Securities are
convertible into or exchangeable for Common Stock or any change
in the rate at which any Convertible Securities are convertible
into or exchangeable for Common Stock (other than rights,
warrants, options or Convertible Securities issued or sold after
the close of business on the date of the original issuance of the
Warrants (i) for which an adjustment in the Purchase Price then
in effect was theretofore made or required to be made, upon the
issuance or sale thereof, or (ii) for which such an adjustment
would have been required had the exercise or purchase price of
such rights, warrants or options at the time of the issuance or
sale thereof or the rate of conversion or exchange of such
Convertible Securities, at the time of the sale of such
Convertible Securities, or the issuance or sale of rights or
warrants to subscribe for or purchase, or options for the
purchase of, such Convertible Securities, been the price or rate
as changed, in which case the provisions of Section 8(f)(E)
hereof shall be applicable if, but only if, the exercise or
purchase price thereof, as changed, or the rate of conversion or
exchange thereof, as changed, consists of cash or requires the
payment of additional consideration, if any, consisting of cash
and the Company did not receive any consideration other than
cash, if any, in connection with such change).
(h) As used in this Section 8, the term "Common Stock" shall mean
and include the Company's Common Stock authorized on the date of the original
issue of the Warrants and shall also include any capital stock of any class of
the Company thereafter authorized which shall not be limited to a fixed sum or
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percentage in respect of the rights of the holders thereof to participate in
dividends and in the distribution of assets upon the voluntary liquidation,
dissolution or winding up of the Company; provided, however, that the shares
issuable upon exercise of the Warrants shall include only shares of such class
designated in the Company's Certificate of Incorporation, as amended, as Common
Stock on the date of the original issue of the Warrants or (i), in the case of
any reclassification, change, consolidation, merger, sale or conveyance of the
character referred to in Section 8(c) hereof, the stock, securities or property
provided for in such section or (ii), in the case of any reclassification or
change in the outstanding shares of Common Stock issuable upon exercise of the
Warrants as a result of a subdivision or combination or consisting of a change
in par value, or from par value to no par value, or from no par value to par
value, such shares of Common Stock as so reclassified or changed.
(i) Any determination as to whether an adjustment in the Purchase
Price in effect hereunder is required pursuant to Section 8, or as to the amount
of any such adjustment, if required, shall be binding upon the holders of the
Warrants and the Company if made in good faith by the Board of Directors of the
Company.
(j) If and whenever the Company shall declare any dividends or
distributions or grant to the holders of Common Stock, as such, rights or
warrants to subscribe for or to purchase, or any options for the purchase of,
Common Stock or securities convertible into or exchangeable for or carrying a
right, warrant or option to purchase Common Stock, the Company shall notify each
of the then Registered Holders of the Warrants of such event prior to its
occurrence to enable such Registered Holders to exercise their Warrants and
participate as holders of Common Stock in such event.
SECTION 9. Redemption.
(a) On not less than thirty (30) days' notice given at any time
after the date hereof (the "Redemption Notice"), to Registered Holders of the
Warrants being redeemed, the Warrants may be redeemed, at the option of the
Company, at a redemption price of $0.25 per Warrant, provided the Market Price
of the Common Stock shall equal or exceed $13.50 per share (the "Target Price"),
subject to adjustment as set forth in Section 9(f), below. All Warrants must be
redeemed if any are redeemed. For purposes of this Section 9, the Calculation
Date shall mean a date within 15 days of the mailing of the Redemption Notice.
The date fixed for redemption of the Warrants is referred to herein as the
"Redemption Date".
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(b) If the conditions set forth in Section 9(a) are met, and the
Company desires to exercise its right to redeem the Warrants, it shall mail a
Redemption Notice to each of the Registered Holders of the Warrants to be
redeemed, first class, postage prepaid, not later than the thirtieth day before
the date fixed for redemption, at their last address as shall appear on the
records maintained pursuant to Section 6(b). Any notice mailed in the manner
provided herein shall be conclusively presumed to have been duly given whether
or not the Registered Holder receives such notice.
(c) The Redemption Notice shall specify (i) the redemption price,
(ii) the Redemption Date, (iii) the place where the Warrant Certificates shall
be delivered and the redemption price paid, (iv) that the right to exercise the
Warrant shall terminate at 5:00 P.M. (New York time) on the business day
immediately preceding the Redemption Date. No failure to mail such notice nor
any defect therein or in the mailing thereof shall affect the validity of the
proceedings for such redemption except as to a Registered Holder (a) to whom
notice was not mailed or (b) whose notice was defective. An affidavit of the
Company that notice of redemption has been mailed shall, in the absence of
fraud, be prima facie evidence of the facts stated therein.
(d) Any right to exercise a Warrant shall terminate at 5:00 P.M.
(New York time) on the business day immediately preceding the Redemption Date.
On and after the Redemption Date, Registered Holders of the Warrants shall have
no further rights except to receive, upon surrender of the Warrant, payment of
the Redemption Price.
(e) From and after the Redemption Date, the Company shall, at the
place specified in the Redemption Notice, upon presentation and surrender to the
Company by or on behalf of the Registered Holder thereof of one or more Warrant
Certificates evidencing Warrants to be redeemed, deliver or cause to be
delivered to or upon the written order of such Registered Holder a sum in cash
equal to the Redemption Price of each such Warrant. From and after the
Redemption Date and upon the deposit or setting aside by the Company of a sum
sufficient to redeem all the Warrants called for redemption, such Warrants shall
expire and become void and all rights hereunder and under the Warrant
Certificates, except the right to receive payment of the Redemption Price, shall
cease.
(f) If the shares of Common Stock are subdivided or combined into
a greater or smaller number of shares of Common Stock, the Target Price shall be
proportionally adjusted by the
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ratio which the total number of shares of Common Stock outstanding immediately
prior to such event bears to the total number of shares of Common Stock to be
outstanding immediately after such event.
SECTION 10. Registration Under The Securities Act of 1933.
The Company agrees to register for resale the shares of Common
Stock issued or issuable upon exercise of Warrants under the Securities Act of
1933, as amended (the "Act"), as set forth below.
10.1 Demand Registration.
(a) If at any time after the Exercise Date, but not more than
five (5) years from the Expiration Date, the Company shall receive a written
request therefor (the "Demand Notice") from holders (the "Requesting Holders")
of Warrants Shares (or Warrants exercisable to acquire Warrant Shares) equal to
50% or more of the aggregate number of Warrant Shares issuable upon exercise of
all of the Warrants ("Registrable Securities"), the Company shall prepare and
file with the Securities and Exchange Commission (the "SEC") a registration
statement under the Act covering the Registrable Securities which are the
subject of such request and shall use its reasonable best efforts to cause such
registration statement to become effective. In addition, upon the receipt of
such request, the Company shall promptly give written notice to all other record
holders of Registrable Securities that such registration is to be effected. The
Company shall include in such registration statement such Registrable Securities
for which it has received written requests to register by such other record
holders within thirty (30) days after the delivery of the Company's written
notice to such other record holders.
(b) In the event that at the time of the Demand Notice the
Company is in the process of preparing a registration statement under the Act
relating to an underwritten public offering, then no holder of securities of the
Company, including Requesting Holders, may include securities in such
registration if in the good faith judgment of the managing underwriter of such
public offering the inclusion of such securities would interfere with the
successful marketing of the securities being underwritten. Shares to be excluded
from an underwritten public offering shall be selected in a manner provided in
Section 10.2 below. To the extent only a portion of the Registrable Securities
held by a Requesting Holder is included in the underwritten public offering, a
registration statement covering
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those Registrable Securities which are excluded from the underwritten public
offering will be filed within 180 days of the consummation of the underwritten
public offering.
(c) The obligation of the Company under this Section 10.1 shall
be limited to one registration statement. The Company shall pay the expenses
described in Section 10.10 for the registration statement filed pursuant to this
Section 10.1, except for underwriting discounts and commissions and legal fees
of the Requesting Holders, which shall be borne by the Requesting Holders.
10.2 "Piggyback" Registration Rights.
(a) From and after the Exercise Date, and until such time as
the Registrable Securities are freely salable (without restriction) under Rule
144 promulgated under the Act, if the Company shall determine to proceed with
the actual preparation and filing of a registration statement under the Act in
connection with the proposed offer and sale of any of its securities by it or
any of its security holders (other than a registration statement on Form S-4,
S-8 or other limited purpose form), the Company will give written notice of its
determination to all record holders of the Registrable Securities. Upon the
written request from the Requesting Holders, (as defined in Section 10.1) within
twenty (20) days after receipt of any such notice from the Company, the Company
will, except as herein provided, cause all such Registrable Securities to be
included in such registration statement, all to the extent requisite to permit
the sale or other disposition by the prospective seller or sellers of the
Registrable Securities to be so registered; provided, further, that nothing
herein shall prevent the Company from, at any time, abandoning or delaying any
registration. If any registration pursuant to this Section 10.2 shall be
underwritten in whole or in part, the Company may require that the Registrable
Securities requested for inclusion pursuant to this Section 10.2 be included in
the underwriting on the same terms and conditions as the securities otherwise
being sold through the underwriters. In the event that the Registrable
Securities requested for inclusion pursuant to this Section 10.2 together with
any other shares which have similar piggyback registration rights (such shares
and the Registrable Securities being collectively referred to as the "Requested
Stock") would, in the good faith judgment of the managing underwriter of such
public offering, reduce the number of shares to be offered by the Company or
interfere with the successful marketing of the shares of stock offered by the
Company, the number of shares of Requested Stock otherwise to be included in the
underwritten public offering may be reduced pro rata (by number of shares) among
the holders thereof requesting such registration or
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excluded in their entirety if so required by the underwriter. To the extent only
a portion of the Requested Stock is included in the underwritten public
offering, those shares of Requested Stock which are thus excluded from the
underwritten public offering shall be withheld from the market by the holders
thereof for a period, not to exceed 180 days, which the managing underwriter
reasonably determines is necessary in order to effect the underwritten public
offering. A registration statement covering those shares of Requested Stock
excluded from the underwritten offering will be filed within 180 days of the
consummation of the underwritten public offering.
(b) The obligation of the Company under this Section 10.2 shall
be unlimited to the number of registration statements.
10.3 Registration Procedures.
(a) If and whenever the Company is required by the provisions of
Section 10.1 or 10.2 to effect the registration of Registrable Securities under
the Act, the Company will:
(i) prepare and file with the SEC a registration
statement with respect to such securities, and use its reasonable best efforts
to cause such registration statement to become and remain effective until the
Registrable Securities are freely salable without the volume limitations of Rule
144;
(ii) prepare and file with the SEC such amendments
to such registration statement and supplements to the prospectus contained
therein as may be necessary to keep such registration statement effective until
the Registrable Securities are freely salable without the volume limitations of
Rule 144;
(iii) furnish to the security holders participating
in such registration and to the underwriters of the securities being registered
such reasonable number of copies of the registration statement, preliminary
prospectus, final prospectus and such other documents as such underwriters may
reasonably request in order to facilitate the public offering of such
securities;
(iv) use its reasonable best efforts to register or
qualify the securities covered by such registration statement under such state
securities or blue sky laws of such jurisdictions as such participating holders
may reasonably request in writing within twenty (20) days following the original
filing of such registration statement, except that the Company shall not for any
purpose be required to execute a general consent to service of process or to
qualify to do business as a
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foreign corporation in any jurisdiction wherein it is not so qualified;
(v) notify the security holders participating in
such registration, promptly after it shall receive notice thereof, of the time
when such registration statement has become effective or a supplement to any
prospectus forming a part of such registration statement has been filed;
(vi) notify such holders promptly of any request by
the SEC for the amending or supplementing of such registration statement or
prospectus or for additional information;
(vii) prepare and file with the SEC, promptly upon
the request of any such holders, any amendments or supplements to such
registration statement or prospectus which, in the opinion of counsel for such
holders (and concurred in by counsel for the Company), is required under the Act
or the rules and regulations thereunder in connection with the distribution of
Common Stock by such holder;
(viii) prepare and promptly file with the SEC and
promptly notify such holders of the filing of such amendment or supplement to
such registration statement or prospectus as may be necessary to correct any
statements or omissions if, at the time when a prospectus relating to such
securities is required to be delivered under the Act, any event shall have
occurred as the result of which any such prospectus or any other prospectus as
then in effect would include an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the light
of the circumstances in which they were made, not misleading; and
(ix) advise such holders, promptly after it shall
receive notice or obtain knowledge thereof, of the issuance of any stop order by
the SEC suspending the effectiveness of such registration statement or the
initiation or threatening of any proceeding for that purpose and promptly use
its reasonable best efforts to prevent the issuance of any stop order or to
obtain its withdrawal if such stop order should be issued.
10.4 Expenses.
(a) With respect to each registration requested pursuant to
Section 10.1 hereof, and with respect to each inclusion of Registrable
Securities in a registration statement pursuant to Section 10.2 hereof, all
fees, costs and expenses of and incidental to such registration, inclusion and
public offering (as specified in paragraph (b) below) in connection
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therewith shall be borne by the Company, provided, however, that any security
holders participating in such registration shall bear their pro rata share of
the underwriting discount and commissions and transfer taxes.
(b) The fees, costs and expenses of registration to be borne by
the Company as provided in paragraph (a) above shall include, without
limitation, all registration, filing, and NASD fees, printing expenses, fees and
disbursements of counsel and accountants for the Company, and all legal fees and
disbursements and other expenses of complying with state securities or blue sky
laws of any jurisdictions in which the securities to be offered are to be
registered and qualified (except as provided in 10.4(a)). Fees and disbursements
of counsel and accountants for the selling security holders and any other
expenses incurred by the selling security holders not expressly included above
shall be borne by the selling security holders.
10.5 Indemnification.
(a) The Company will indemnify and hold harmless each holder of
Registrable Securities which are included in a registration statement pursuant
to the provisions of Sections 10.1 or 10.2, its directors and officers, and any
underwriter (as defined in the Act) for such holder and each person, if any, who
controls such holder or such underwriter within the meaning of the Act, from and
against, and will reimburse such holder and each such underwriter and
controlling person with respect to, any and all loss, damage, liability, cost
and expense to which such holder or any such underwriter or controlling person
may become subject under the Act or otherwise, insofar as such losses, damages,
liabilities, costs or expenses are caused by any untrue statement or alleged
untrue statement of any material fact contained in such registration statement,
any prospectus contained therein or any amendment or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading; provided, however, that the Company will not be liable in any such
case to the extent that any such loss, damage, liability, cost or expenses
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission so made in conformity with information furnished
by such holder, such underwriter or such controlling person in writing
specifically for use in the preparation thereof.
(b) Each holder of Registrable Securities included in a
registration pursuant to the provisions of Sections 10.1 or 10.2 will indemnify
and hold harmless the Company, its directors
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and officers, any controlling person and any underwriter from and against, and
will reimburse the Company, its directors and officers, any controlling person
and any underwriter with respect to, any and all loss, damage, liability, cost
or expense to which the Company or any controlling person and/or any underwriter
may become subject under the Act or otherwise, insofar as such losses, damages,
liabilities, costs or expenses are caused by any untrue statement or alleged
untrue statement of any material fact contained in such registration statement,
any prospectus contained therein or any amendment or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was so
made in reliance upon and in strict conformity with written information
furnished by or on behalf of such holder specifically for use in the preparation
thereof.
(c) Promptly after receipt by an indemnified party pursuant to
the provisions of paragraph (a) or (b) of this Section 10.5 of notice of the
commencement of any action involving the subject matter of the foregoing
indemnity provisions such indemnified party will, if a claim thereof is to be
made against the indemnifying party pursuant to the provisions of said paragraph
(a) or (b), promptly notify the indemnifying party of the commencement thereof;
but the omission to so notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than
hereunder. In case such action is brought against any indemnified party and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party shall have the right to participate in, and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party,
provided, however, if the defendants in any action include both the indemnified
party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other
indemnified parties which are different from or in addition to those available
to the indemnified party, or if there is a conflict of interest which would
prevent counsel for the indemnifying party from also representing the
indemnified party, the indemnified party or parties have the right to select
separate counsel to participate in the defense of such action on behalf of such
indemnified party or parties. After notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party pursuant to the
provisions of
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said paragraph (a) or (b) for any legal or other expense subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation, unless (i) the indemnified party shall have
employed counsel in accordance with the provisions of the preceding sentence,
(ii) the indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after the notice of the commencement of the action or (iii) the indemnifying
party has authorized the employment of counsel for the indemnified party at the
expense of the indemnifying party.
SECTION 11. Fractional Warrants and Fractional Shares.
(a) If the number of shares of Common Stock purchasable upon the
exercise of each Warrant is adjusted pursuant to Section 8 hereof, the Company
shall nevertheless not be required to issue fractions of shares of Common Stock,
upon exercise of the Warrants or otherwise, or to distribute certificates that
evidence fractional shares. With respect to any fraction of a share of Common
Stock called for upon any exercise of a Warrant, the Company may, in its sole
discretion issue one additional whole share of Common Stock, or otherwise shall
pay to the Registered Holder an amount in cash equal to such fraction multiplied
by the current market value of such fractional share, determined as follows:
(1) If the Common Stock is listed on a national securities
exchange or admitted to unlisted trading privileges on such
exchange or listed for trading on the Nasdaq National Market or
Nasdaq SmallCap Market, the current market value shall be the
last reported sale price of the Common Stock on such exchange on
the last trading day prior to the date of exercise of the
applicable Warrant or if no such sale is made on such day or no
last reported sale price is quoted, the average of the closing
bid and asked prices for such day on such exchange or system; or
(2) If the Common Stock is listed in the over-the-counter
market (other than on Nasdaq) or admitted to unlisted trading
privileges, the current market value shall be the mean of the
last reported bid and asked prices reported by the National
Quotation Bureau, Inc. on the last business day prior to the date
of the exercise of this Warrant; or
(3) If the Common Stock is not so listed or
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admitted to unlisted trading privileges and bid and asked prices
are not so reported, the current market value shall be an amount
determined in such reasonable manner as may be prescribed by the
Board of Directors of the Company.
SECTION 12. Warrant Holders Not Deemed Stockholders. No
Registered Holder of Warrants shall, as such, be entitled to vote or to receive
dividends or be deemed the holder of Common Stock that may at any time be
issuable upon exercise of such Warrants for any purpose whatsoever, nor shall
anything contained herein be construed to confer upon the Registered Holder of
Warrants, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action (whether upon any recapitalization, issue or reclassification
of stock, change of par value or change of stock to no par value, consolidation,
merger or conveyance or otherwise), or to receive notice of meetings, or to
receive dividends or subscription rights, until such Registered Holder shall
have exercised such an applicable Warrant and been issued shares of Common Stock
with respect thereto in accordance with the provisions hereof.
SECTION 13. Rights of Action. All rights of action with respect
to this Agreement are vested in the respective Registered Holders of the
Warrants, and any Registered Holder of a Warrant, without consent of the Company
or of the holder of any other Warrant, may, on its own behalf and for its
benefit, enforce against the Company his right to exercise its Warrant for the
purchase of shares of Common Stock in the manner provided in the Warrant
Certificate and this Agreement.
SECTION 14. Agreement of Warrantholders. Every holder of a
Warrant, by its acceptance thereof, consents and agrees with the Company, and
every other holder of a Warrant that:
(a) The Warrants are transferable only on the registry books of
the Company by the Registered Holder thereof in person or by its attorney duly
authorized in writing and only if the Warrant Certificates representing such
Warrants are surrendered at the Corporate Office of the Company, duly endorsed
or accompanied by a proper instrument of transfer satisfactory to the Company,
in its sole discretion, together with payment of any applicable transfer taxes;
and
(b) The Company may deem and treat the person in whose
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name the Warrant Certificate is registered as the holder and as the absolute,
true and lawful owner of the Warrants represented thereby for all purposes, and
the Company shall not be affected by any notice or knowledge to the contrary,
except as otherwise expressly provided in Section 7 hereof.
SECTION 15. Cancellation of Warrant Certificates. If the Company
shall purchase or acquire any Warrant or Warrants, the Warrant Certificate or
Warrant Certificates evidencing the same shall thereupon be cancelled by the
Company and retired; the Company shall also cancel Common Stock following
exercise of any or all of the Warrants represented thereby or delivered to it
for transfer, splitup, combination or exchange.
SECTION 16. Modification of Agreement. This Agreement may be
modified, supplemented or altered with the consent in writing of the Registered
Holders of Warrant Certificates representing not less than 50% of the Warrants
then outstanding; and provided, that no change in the number or nature of the
securities purchasable upon the exercise of any Warrant, or the Purchase Price
therefor, or the acceleration of the Warrant Expiration Date, shall be made
without the consent in writing of the Registered Holder of the Warrant
Certificate representing such Warrant, other than as otherwise provided herein.
SECTION 17. Notices. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed to have been
made when mailed first class registered or certified mail, postage prepaid as
follows: if to the Registered Holder of a Warrant Certificate, at the address of
such holder as shown on the registry books maintained by the Company, which
shall be initially the respective addresses set forth on Schedule 1; if to the
Company, at 920 North Franklin Street, Suite 402, Chicago, IL 60610, Attention:
Paul F. Lavallee, Chief Executive Officer.
SECTION 18. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Illinois, without
reference to principles of conflict of laws.
SECTION 19. Binding Effect. This Agreement shall be binding upon
and inure to the benefit of the Company (and its successors and assigns) and the
Registered Holders from time to time of Warrant Certificates. Nothing in this
Agreement is intended or shall be construed to confer upon any other person
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any right, remedy or claim, in equity or at law, or to impose upon any other
person any duty, liability or obligation.
SECTION 20. Termination. This Agreement shall terminate on the
earlier to occur of (i) the close of business on the Expiration Date of all the
Warrants; or (ii) the date upon which all Warrants have been exercised.
SECTION 21. Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall constitute an original and all of
which together shall constitute a single document.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the date first above written.
MICROSULIS MEDICAL CORPORATION
By: ____________________________________
Paul F. Lavallee
Chief Executive Officer
WARRANT HOLDERS
EXHIBIT A
THIS WARRANT AND ANY SHARES OF COMMON STOCK ISSUABLE UPON ITS EXERCISE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND MAY NOT BE TRANSFERRED UNTIL (1) A REGISTRATION STATEMENT UNDER THE
SECURITIES ACT SHALL HAVE BECOME EFFECTIVE WITH RESPECT THERETO, OR (2) RECEIPT
BY THE ISSUER OF AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE ISSUER TO
THE EFFECT THAT REGISTRATION UNDER THE SECURITIES ACT IS NOT REQUIRED IN
CONNECTION WITH SUCH PROPOSED TRANSFER NOR IS SUCH TRANSFER IN VIOLATION OF ANY
APPLICABLE STATE SECURITIES LAWS. [THE EXERCISE, SALE, TRANSFER OR OTHER
DISPOSITION OF THIS WARRANT AND ANY SHARES OF COMMON STOCK ISSUABLE UPON ITS
EXERCISE ARE SUBJECT TO CERTAIN SO-CALLED "LOCK-UP" RESTRICTIONS PURSUANT TO A
STOCKHOLDERS AGREEMENT DATED _____________, 2000 AMONG THE ISSUER, THE ORIGINAL
HOLDER OF
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THIS WARRANT AND THE OTHER STOCKHOLDERS NAMED THEREIN. A COPY OF SUCH AGREEMENT
MAY BE OBTAINED WITHOUT CHARGE BY CONTACTING THE ISSUER AT ITS ADDRESS SET FORTH
HEREIN.]
No. W_________ _________________________
Warrants
VOID AFTER _________________, 2005
WARRANT CERTIFICATE FOR PURCHASE
OF COMMON STOCK
MICROSULIS MEDICAL CORPORATION
(formerly named AccuMed International, Inc.)
This certifies that FOR VALUE RECEIVED ________________________
or registered assigns (the "Registered Holder") is the owner of the number of
Warrants ("Warrants") specified above. Each Warrant initially entitles the
Registered Holder to purchase, subject to the terms and conditions set forth in
this Certificate and the Warrant Agreement (as hereinafter defined), one fully
paid and nonassessable share of Common Stock, $0.01 par value per share ("Common
Stock") of (Microsulis Medical Corporation, a Delaware corporation (the
"Company"), at any time commencing on _______________, 2000 and prior to the
Expiration Date (as hereinafter defined), upon the presentation and surrender of
this Warrant Certificate with the Exercise Form on the reverse hereof properly
completed and duly executed, at the corporate office of the Company, accompanied
by payment of an amount equal to $6.75 (subject to adjustment) for each Warrant
(the "Purchase Price") in lawful money of the United States of America in cash
or by official bank or certified check made payable to Microsulis Medical
Corporation.
This Warrant Certificate and each Warrant represented hereby are
issued pursuant to and are subject in all respects to the terms and conditions
set forth in the Warrant Agreement (the "Warrant Agreement"), dated
___________________, 2000 among the Company and the Warrantholders named therein
pursuant to the Agreement and Plan of Merger dated November 16, 1999 and amended
December 16, 1999, December 21, 1999 and December 22, 1999 among the Company,
AccuMed Acquisition Sub and Microsulis Corporation.
In the event of certain contingencies provided for in the Warrant
Agreement, the Purchase Price or the number of shares of Common Stock subject to
purchase upon the exercise of each Warrant represented hereby are subject to
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modification or adjustment.
Each Warrant represented hereby is exercisable at the option of
the Registered Holder, but no fractional shares of Common Stock will be issued
in respect thereto. In the case of the exercise of less than all the Warrants
represented hereby, the Company shall cancel this Warrant Certificate upon the
surrender hereof and shall execute and deliver to the Registered Holder a new
Warrant Certificate or Warrant Certificates of like tenor for the balance of
such Warrants.
The term "Expiration Date" shall mean 5:00 P.M. (New York time)
on ___________________, 2005 or such earlier date as the Warrants shall be
redeemed. If such date shall in the State of New York be a holiday or a day on
which the banks are authorized to close, then the Expiration Date shall mean
5:00 P.M. (New York time) the next following day which in the State of New York
is not a holiday or a day on which banks are authorized to close.
This Warrant Certificate is exchangeable, upon the surrender
hereof by the Registered Holder at the corporate office of the Company, for a
new Warrant Certificate or Warrant Certificates of like tenor representing an
equal aggregate number of Warrants, each of such new Warrant Certificates to
represent such number of Warrants as shall be designated by such Registered
Holder at the time of such surrender. Upon due presentment with any tax or other
governmental charge imposed in connection therewith, for registration of
transfer of this Warrant Certificate at such office, a new Warrant Certificate
or Warrant Certificates representing an equal aggregate number of Warrants will
be issued to the transferee in exchange therefor, subject to the limitations
provided in the Warrant Agreement.
Prior to the exercise of any Warrant represented hereby, the
Registered Holder shall not be entitled to any of the rights of a stockholder of
the Company, including, without limitation, the right to vote or to receive
dividends or other distributions, and shall not be entitled to receive any
notice of any proceedings of the Company, except as provided in the Warrant
Agreement.
The Warrants represented hereby may be redeemed at the option of
the Company, at a redemption price of $0.25 per Warrant at any time after the
date hereof, provided the Market Price (as defined in the Warrant Agreement) for
the Common Stock shall equal or exceed $13.50 per share. Notice of redemption
shall be given not later than the thirtieth day before the date fixed for
redemption, all as provided in
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the Warrant Agreement. On and after the date fixed for redemption, the
Registered Holder shall have no rights with respect to the Warrants represented
hereby except to receive the $0.25 in cash per Warrant upon surrender of this
Warrant Certificate.
Prior to due presentment for registration of transfer hereof, the
Company may deem and treat the Registered Holder as the absolute owner hereof
and of each Warrant represented hereby (notwithstanding any notations of
ownership or writing hereon made by anyone other than a duly authorized officer
of the Company) for all purposes and shall not be affected by any notice to the
contrary.
This Warrant Certificate shall be governed by and construed in
accordance with the laws of the State of Illinois without regard to the conflict
of law provisions thereof.
IN WITNESS WHEREOF, the Company has caused this Warrant
Certificate to be duly executed, manually or in facsimile by two of its officers
thereunto duly authorized and a facsimile of its corporate seal to be imprinted
hereon.
MICROSULIS MEDICAL CORPORATION
Dated: ___________________, 2000
By: _____________________________
Paul F. Lavallee, Chief
Executive Officer
[seal]
Attest: ________________________
Joyce L. Wallach
Assistant Secretary
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29
NOTICE OF EXERCISE
To Be Executed by the Registered Holder
in Order to Exercise Warrants
The undersigned Registered Holder hereby irrevocably elects to exercise ________
_________________ Warrants represented by this Warrant Certificate, and to
purchase the securities issuable upon the exercise of such Warrants, and
requests that certificates for such securities shall be issued in the name of:
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
______________________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________
[please print or type name and address]
and be delivered to
______________________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________
[please print or type name and address]
and if such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, that a new Warrant Certificate for the balance of such
Warrants be registered in the name of, and delivered to, the Registered Holder
at the address stated above.
The undersigned represents that the exercise of the within Warrant was solicited
by a member of the National Association of Securities Dealers, Inc. If not
solicited by an NASD member, please write "unsolicited" in the space below.
______________________________________
(Name of NASD Member)
Dated:_________________________
X__________________________
___________________________
___________________________
Address
______________________________________
Taxpayer Identification Number
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30
______________________________________
Signature Guaranteed
THE SIGNATURE TO THE ASSIGNMENT OR THE EXERCISE NOTICE MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE
GUARANTEED BY A COMMERCIAL BANK OR TRUST COMPANY OR A MEMBER FIRM OF THE
AMERICAN STOCK EXCHANGE, NEW YORK STOCK EXCHANGE, PACIFIC STOCK EXCHANGE OR
MIDWEST STOCK EXCHANGE.
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31
ASSIGNMENT
To Be Executed by the Registered Holder
in Order to Assign Warrants
FOR VALUE RECEIVED, ___________________ hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
__________________________________________
__________________________________________
__________________________________________
__________________________________________
[please print or type name and address]
_________________________ of the Warrants represented by this Warrant
Certificate, and hereby irrevocably constitutes and appoints
____________________________________ _______________________________ Attorney to
transfer this Warrant Certificate on the books of the Company, with full power
of substitution in the premises.
Dated:____________________
X_________________________
Signature Guaranteed
__________________________
THE SIGNATURE TO THE ASSIGNMENT OR THE EXERCISE NOTICE MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE
GUARANTEED BY A COMMERCIAL BANK OR TRUST COMPANY OR A MEMBER FIRM OF THE
AMERICAN STOCK EXCHANGE, NEW YORK STOCK EXCHANGE, PACIFIC STOCK EXCHANGE OR
MIDWEST STOCK EXCHANGE.
-31-