Exhibit 4.2
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). THE SECURITIES MAY NOT BE
SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND IN COMPLIANCE WITH
APPLICABLE STATE SECURITIES LAWS, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED AND THAT THE
SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR TRANSFER IS IN COMPLIANCE WITH
APPLICABLE STATE SECURITIES LAWS.
NOT EXERCISABLE PRIOR TO SEPTEMBER [ ], 1998. VOID AFTER 5:00 P.M.,
NEW YORK TIME, SEPTEMBER[ ], 2003.
UW-002 One Hundred Thousand (100,000) WARRANTS
UNDERWRITER'S WARRANT
Dated: October 9, 1997
THIS CERTIFIES THAT in consideration of $10.00 duly paid J.P. Turner & Co.,
LLC., ("J.P. Turner"), and Klein Maus and Shire Incorporated ("KMS")
(collectively J.P. Turner and KMS are referred to as the "Underwriter") or its
registered assigns (_____________ being such a registered assign, a "Holder") is
the owner of this Warrant (the "Underwriter's Warrant") to purchase from DECTRON
INTERNATIONALE INC., a Quebec, Canada corporation (the "Company"), during the
period and at the prices hereinafter specified, up to 100,000 shares (the
"Shares"), of the Company's common stock, no par value per share (the "Common
Stock") and up to 100,000 Common Stock purchase warrants (the "Warrants" and
collectively the Warrants and the Shares are hereinafter referred to as the
"Securities"). This Underwriter's Warrant is issued pursuant to an Underwriting
Agreement dated September, [ ] 1998, between the Company and the Underwriter in
connection with a public offering (the "Public Offering") through the
Underwriter of (i) 1,000,000 shares of Common Stock and 1,000,000 Warrants and
(ii) pursuant to the Underwriter's Over Allotment Option (the "Over-Allotment
Option") up to an additional 150,000 shares of Common Stock and 150,000 Warrants
(the "Public Securities"). The Shares and Warrants issuable pursuant to the
Underwriter's Warrant shall have the same terms and conditions as the shares of
Common Stock and the Warrants making up the Public Securities, as described
under the caption
1
"Description of Securities" in the Company's Registration Statement on Form
SB-2, File No. 333-[ ], as amended, (the "Registration Statement"), except that
the Holder shall have registration rights under the Securities Act of 1933 (the
"Act"), for the Underwriter's Warrant, the Shares and Warrants.
1. The rights represented by this Underwriter's Warrant shall be
exercisable at the prices and during the period specified below, upon the terms
and subject to the conditions set forth herein:
(a) During the period from the date hereof to September [ ], 1999, 12
months from the effective date of the Registration Statement (the
"Effective Date") inclusive, the Holder shall have no right to
purchase any Securities hereunder.
(b) Between [ ], 1999 and [ ], 2003, four years from the effective
date (the "Expiration Date") inclusive, the Holder shall have the
option to purchase the Shares and the Warrants hereunder at a
price of $[9.20] per Share and $[ ] per Warrant, respectively, the
purchase price of the Shares and the Warrants being [ ]% above the
public offering prices of the Public Securities, subject to
adjustment as provided in paragraph 8 hereof.
(c) After the Expiration Date, the Holder shall have no right to
purchase any Securities hereunder and this Underwriter's Warrant
shall expire at 5:00 P.M. on such date.
2. (a) The rights represented by this Underwriter's Warrant may be
exercised at any time within the periods above specified, in whole or in part,
by (i) the surrender of this Underwriter's Warrant (with the purchase form at
the end hereof properly executed) at the principal executive office of the
Company (or such other office or agency of the Company as it may designate by
notice in writing to the Holder at the address of the Holder appearing on the
books of the Company); (ii) payment to the Company of the exercise price then in
effect for the number of Securities specified in the above-mentioned purchase
form together with applicable stock transfer taxes, if any; and (iii) delivery
to the Company of a duly executed agreement signed by the person(s) designated
in the purchase form to the effect that such person(s) agree(s) to be bound by
the provisions of paragraph 6 and subparagraphs (b), (c) and (d) of paragraph 7
hereof. This Underwriter's Warrant shall be deemed to have been exercised, in
whole or in part to the extent specified, immediately prior to the close of
business on the date the Underwriter's Warrant is surrendered and payment is
made in accordance with the foregoing provisions of this paragraph 2, and the
person or persons in whose name or names the certificates for the Securities
shall be issuable upon such exercise shall become the holder or holders of
record of such Securities at that time and date. Certificates representing the
Securities so purchased shall be delivered to the Holder within a reasonable
time, not exceeding ten (10) days, after the rights represented by this
Underwriter's Warrant shall have been so exercised.
(b) Notwithstanding anything to the contrary contained in
subparagraph (a) of paragraph 2, the Holder may elect to exercise this
Underwriter's Warrant in whole or in part by
2
receiving Shares and/or Warrants equal to the value (as determined below) of
this Underwriter's Warrant at the principal office of the Company together with
notice of such election in which event the Company shall issue to the Holder a
number of Shares and/or Warrants computed using the following formula:
X = Y(A-B)
-----------
A
Where: X = the number of Shares and/or Warrants to be issued to the Holder;
- -----
Y = the number of Shares and/or Warrants to be exercised under this
Underwriter's Warrant;
A = the current fair market value of one share of Common Stock
and/or one Warrant (calculated as described below); and
B = the Share Exercise Price and/or the Warrant Exercise Price, as
the case may be.
As used herein, the current fair market value of one share of Common Stock
shall mean the greater of (x) the average of the closing prices of the Company's
Common Stock sold on all securities exchanges on which the Common Stock may at
the time be listed and the NASDAQ National Market, or, if there have been no
sales on any such exchange or the NASDAQ National Market on such day, the
average of the highest bid and lowest asked price on such day on The Nasdaq
Stock Market or otherwise in the domestic over-the-counter market as reported by
the National Quotation Bureau, Incorporated, or any similar successor
organization (the "Market Price"), on the trading day immediately preceding the
date notice of exercise of this Underwriter's Warrant is given or (y) the
average of the Market Price per share of Common Stock for the five trading days
immediately preceding the date notice of exercise of this Underwriter's Warrant
is given. If on any date for which the Market Price per share of Common Stock is
to be determined the Common Stock is not listed on any securities exchange or
quoted on the NASDAQ National Market or on The Nasdaq Stock Market or otherwise
in the over-the-counter market, the Market Price per share of Common Stock shall
be the highest price per share which the Company could then obtain from a
willing buyer (not a current employee or director) for shares of Common Stock
sold by the Company, from authorized but unissued shares, as determined in good
faith by the Board of Directors of the Company, unless prior to such date the
Company has become subject to a merger, acquisition or other consolidation
pursuant to which the Company is not the surviving party, in which case the
Market Price per share of Common Stock shall be deemed to be the value received
by the holders of the Company's Common Stock for each share thereof pursuant to
the Company's acquisition.
The current fair market value of one Warrant shall be determined in a like
manner, with reference to the prices per Warrant.
3
3. The Underwriter's Warrant shall not be transferred, sold, assigned,
pledged or hypothecated (other than by will or pursuant to the laws of
descent and distribution) for a period of one year commencing on [ ],
1998, except that it may be transferred to successors of the Holder, and may
be assigned in whole or in part to any person who is an officer, director,
shareholder, employee or partner of the Underwriter or to any member of the
selling group and/or the officers, directors, shareholders, employees or
partners thereof during such period. Any such assignment shall be effected by
the Holder by (i) executing the form of assignment at the end hereof and (ii)
surrendering this Underwriter's Warrant for cancellation, together with the
duly executed form of assignment, at the office or agency of the Company
referred to in paragraph 2 hereof, accompanied by a certificate (signed by a
duly authorized officer, agent, member or other representative, as the case
may be, of the Holder), stating that each transferee is a permitted
transferee under this paragraph 3; whereupon the Company shall issue, in the
name or names specified by the Holder a new Underwriter's Warrant or
Underwriter's Warrants of like tenor and representing in the aggregate rights
to purchase the same number of Securities as are purchasable hereunder.
4. The Company covenants and agrees that all Shares issuable upon
exercise of this Underwriter's Warrants and all Common Stock issuable upon
exercise of the Warrants underlying this Underwriter's Warrants (the "Warrant
Shares") will, upon issuance thereof and receipt by the Company of payment of
the purchase price therefor in accordance with the terms hereof, be duly and
validly issued, fully paid and nonassessable and no personal liability will
attach to the holder thereof. The Company further covenants and agrees that
during the period within which the Underwriter's Warrant may be exercised, the
Company will at all times have authorized and reserved a sufficient number of
shares of its Common Stock to provide for the exercise of the Underwriter's
Warrant and the Warrants included therein.
5. The Underwriter's Warrant shall not entitle the Holder to any voting
rights or other rights as stockholders of the Company.
6. (a)(i) During the period of seven years from the Effective Date the
Company shall advise the Holder, whether the Holder holds this Underwriter's
Warrant or has exercised this Underwriter's Warrant and holds Shares, Warrants
or Warrant Shares, by written notice at least thirty days prior to the filing of
any post-effective amendment to the Registration Statement or of any new
registration statement or post-effective amendment thereto under the Act,
covering any securities of the Company, for its own account or for the account
of others, except for any registration statement filed on Form S-4 or S-8
(including a Form S-3 related to a Form S-8) and will, for a period of seven
years from the Effective Date, upon the request of the Holder made during such
seven year period, and subject to subparagraph 6(a)(ii), include in any such
post-effective amendment or new registration statement such information as may
be required to permit a public offering of this Underwriter's Warrant, the
Shares, the Warrant Shares and the Warrants (collectively, the "Registerable
Securities"); provided that this paragraph 6(a) shall not apply to any
registration statement filed pursuant to paragraph 6(b) hereof; and provided,
further, that, notwithstanding the foregoing, the Holder shall have no right to
include any Registerable Securities in any new registra-
4
tion statement or post-effective amendment thereto unless as of the effective
date thereof, the Registration Statement (as it may hereafter be amended or
supplemented) or any new registration statement under which the Registerable
Securities are registered shall have ceased to be effective or as the
prospectus contained therein shall have ceased to be current. The Company
shall supply prospectuses and such other documents as the Holder may
reasonably request in order to facilitate the public sale or other
disposition of the Registerable Securities, use its best efforts to register
and qualify any of the Registerable Securities for sale in such states as the
Holder designates, and do any and all other acts and things which may be
necessary or desirable to enable the Holder to consummate the public sale or
other disposition of the Registerable Securities, all at no expense to the
Holder or the Underwriter, and furnish indemnification in the manner provided
in paragraph 7 hereof; provided, that, without limiting the foregoing, the
Company shall not be obligated to execute or file any general consent to
service of process or to qualify as a foreign corporation to do business
under the laws of any such jurisdiction. The Holder shall furnish information
and indemnification as set forth in Paragraph 7. The Company shall continue
to advise the Holders of the Registerable Securities of its intention to file
a registration statement or amendment pursuant to this Paragraph 5(a) until
the earliest of (i) seven years from the Effective Date; (ii) such time as
all of the Registerable Securities have been registered and publicly sold
under the Act; or (iii) such time as in the opinion of legal counsel to the
Company, which counsel shall be reasonably acceptable to the Holder, the
Registerable Securities may be offered and sold by the holders thereof
without being registered under the Act and any applicable state securities
laws and such securities, upon receipt by the purchasers thereof pursuant to
such sale, will not constitute "restricted securities" as such term is
defined in Rule 144 under the Act.
(ii) If the registration of which the Company gives notice is for
a registered public offering involving an underwriting, the Company shall so
advise the Holder as a part of the written notice given pursuant to subparagraph
6(a)(i). If the underwriters or managing underwriter thereof determines that a
limitation of the number of shares to be underwritten is required, the
underwriter may exclude some or all of the Registerable Securities from such
registration (the "Excluded Registerable Securities"); provided, however, that
no other security-holder may include any such securities in such Registration
Statement if any of the Registerable Securities have been excluded from such
registration; and further provided that the Company will file a new Registration
Statement covering the Excluded Registerable Securities, at the Company's
expense, within six months after the completion of such underwritten offering.
(b) On any one occasion only, if any 50.1% Holder (as defined
below) shall give notice to the Company at any time during the three year period
beginning one year from the Effective Date to the effect that such Holder
desires to register under the Act any or all of the Registerable Securities,
under such circumstances that a public distribution (within the meaning of the
Act) of any such Registerable Securities will be involved (and the Registration
Statement or any new registration statement under which such Registerable
Securities are registered shall have ceased to be effective or the Prospectus
contained therein shall have ceased to be current), then the Company will
promptly, but no later than 60 days after receipt of such notice at the
Company's option , file a post-effective amendment to the current Registration
Statement or a new registration statement pursuant
5
to the Act, so that such designated Registerable Securities may be publicly sold
under the Act as promptly as practicable thereafter and the Company will use its
best efforts to cause such registration to become and remain effective as
provided herein (including the taking of such steps as are necessary to obtain
the removal of any stop order), provided, that such 50.1% Holder shall furnish
the Company with appropriate information in connection therewith as the Company
may reasonably request in writing. Inclusive of this demand right shall be that
the 50.1% Holder may, at its option, request the filing of a post-effective
amendment to the current Registration Statement or a new registration statement
under the Act, inclusive of the right granted by subparagraph 6(a) on one
occasion only during the six-year period beginning one year from the effective
date of the Registra tion Statement (the "Effective Date"). The 50.1% Holder
may, at its option, request the registration of the Underwriter's Warrant and/or
any of the securities underlying the Underwriter's Warrant in a registration
statement made by the Company as contemplated by subparagraph 6(a) or in
connection with a request made pursuant to this subparagraph 6(b) prior to
acquisition of the shares of Common Stock and/or Redeemable Warrants issuable
upon exercise of the Underwriter's Warrant. The 50.1% Holder may, at its option,
request such post-effective amendment or new registration statement during the
described period with respect to the Underwriter's Warrant, or separately as to
the Common Stock and/or Warrants issuable upon the exercise of the Underwriter's
Warrant, and such registration rights may be exercised by the 50.1% Holder prior
to or subsequent to the exercise of this Underwriter's Warrant.
Within ten days after receiving any such notice pursuant to this
subparagraph 6(b), the Company shall give notice to any other Holder of the
Underwriter's Warrant or Registerable Securities, advising that the Company is
proceeding with such post-effective amendment or registration statement and
offering to include therein the Registerable Securities held by the other
Holder, provided that they shall furnish the Company with such appropriate
information (relating to the intentions of such Holder) in connection therewith
as the Company shall reasonably request in writing. All costs and expenses of
the post-effective amendment or new registration statement shall be borne by the
Company, except that the Holder(s) shall bear the fees of their own counsel and
any underwriting discounts or commissions applicable to any of the Registerable
Securities sold by them. The Company will maintain such registration statement
or post-effective amendment current under the Act for a period of at least nine
months (and for up to an additional three months if requested by the Holder(s))
from the effective date thereof. The Company shall provide the Holder(s) with
(x) prospectuses, in such quantities as the Holder(s) may request in order to
facilitate the public sale or other disposition of the Registerable Securities,
(y) use its best efforts to register and qualify any of the Registerable
Securities for sale in such states as Holder(s) designate (z), indemnification
in the manner provided in paragraph 7 hereof. The Company shall also deliver
promptly to the Holder, if requested, copies of all correspondence between the
Commission and the Company, its counsel or auditors and all memoranda relating
to discussions with the Commission or its staff with respect to the registration
statement and permit the Holder to do such investigation, upon reasonable
advance notice, with respect to information contained in or omitted from the
registration statement as it deems reasonably necessary to comply with
applicable securities laws or rules of the NASD. Such investigation shall
include access to books, records and properties and opportunities to discuss
6
the business of the Company with its officers and independent auditors, all to
such reasonable extent and at such reasonable times as the Holder shall
reasonably request.
(c) The term "50.1% Holder" as used in this paragraph 6 shall
mean the Holder(s) of at least 50.1% of this Underwriter's Warrant, the Shares,
Warrants or Warrant Shares and shall include any owner or combination of owners
of such securities, which ownership shall be calculated by determining the
number of Shares held by such owner or owners as well as the number of shares of
Common Stock then issuable upon exercise of the Underwriter's Warrant and the
Warrants.
(d) If at any time prior to the effectiveness of the
registration statement filed in connection with an offering pursuant to this
paragraph 6(b) the 50.1% Holder shall determine not to proceed with the
registration, upon notice to the Company and the payment to the Company by the
50.1% Holder of the Company's expenses, if any, theretofore incurred in
connection with the registration statement, the 50.1% Holder may terminate its
participation in the offering, and the registration statement previously filed
shall not be counted against the number of demand registrations permitted under
this paragraph 6(b).
(e) Notwithstanding the foregoing, if the Company shall
furnish to such 50.1% Holder a certificate signed by the President of the
Company stating that in the good faith judgment of the Board of Directors it
would be seriously detrimental to the Company or its stockholders for a
registration statement to be filed in the near future containing the disclosure
of material information required to be included therein by reason of the federal
securities laws, then the Company's obligation to use its best efforts to file a
registration statement shall be deferred for a period during which such
disclosure would be seriously detrimental, provided that this period will not
exceed 30 days and provided further, that the Company shall not defer its
obligation in this matter more than once in any 12 month period.
7. (a) Whenever pursuant to paragraph 6 a registration statement
relating to any Registerable Securities is filed under the Act, amended or
supplemented, the Company will indemnify and hold harmless each Holder of the
Registerable Securities covered by such registration statement, amendment or
supplement (such Holder being hereinafter called the "Distributing Holder"), and
each person, if any, who controls (within the meaning of the Act) the
Distributing Holder, and each underwriter (within the meaning of the Act) of
such securities and each person, if any, who controls (within the meaning of the
Act) any such underwriter, against any losses, claims, damages or liabilities,
joint or several, to which the Distributing Holder, any such controlling person
or any such underwriter may become subject under the Act or otherwise, insofar
as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in any such registration statement or any
preliminary prospectus or final prospectus constituting a part thereof or any
amendment or supplement thereto, or arise out of or are based upon the omission
or the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading and will
reimburse the Distributing Holder and such controlling
7
person or underwriter in connection with investigating or defending any such
loss, claim, damage, liability or action; provided, however, that the Company
will not be liable in any such case, to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made (i) in such
registration statement, such preliminary prospectus, such final prospectus or
such amendment or supplement in reliance upon and in conformity with written
information furnished by such Distributing Holder or any other Distributing
Holder for use in the preparation thereof or (ii) made in any preliminary
prospectus, but corrected in the final prospectus, as amended or supplemented.
(b) The Distributing Holder will indemnify and hold harmless
the Company, each of its directors, each of its officers who have signed such
registration statement and such amend ments and supplements thereto, and each
person, if any, who controls the Company (within the meaning of the Act) against
any losses, claims, damages or liabilities, joint or several, to which the
Company or any such director, officer or controlling person may become subject
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue or alleged untrue statement of any material fact contained in such
registration statement or any preliminary prospectus, or final prospectus
constituting a part thereof, or any amendment or supplement thereto, or arise
out of or are based upon the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent, that
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
such registration statement, such preliminary prospectus, such final prospectus
or such amendment or supplement in reliance upon and in conformity with written
information furnished by such Distributing Holder for use in the preparation
thereof; and will reimburse the Company or any such director, officer or
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action.
(c) Promptly after receipt by an indemnified party under this
paragraph 7 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against any indemnifying
party, give the indemnifying party notice of the commencement thereof, but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than under this
paragraph 7.
(d) In case any such action is brought against any indemnified
party, and it notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled 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 reasonably satisfactory to such
indemnified party, and 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 under this
paragraph 7 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of
8
investigation.
8. (a) The Share Exercise Price in effect at any time and the number
and kind of securities purchasable upon the exercise of the Underwriter's
Warrant shall be subject to adjustment from time to time upon the happening of
certain events hereinafter described; provided, however, that no adjustment
shall be required in respect of the shares issuable upon exercise of the
Warrants.
(i) (x) If after the date hereof the Company shall subdivide or
combine the outstanding shares of Common Stock, the Share Exercise Price shall
forthwith be proportionately deceased in the case of subdivision or increased in
the case of combination. (y) In case of any reclassification or change of the
outstanding shares of Common Stock (other than a change in par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination), or in the case of any consolidation of the Company with, or merger
of the Company into, another corporation (other than a consolidation or merger
which does not result in any reclassification or change of the outstanding
shares of Common Stock, except a change as a result of a subdivision or
combination of such shares or a change in par value, as aforesaid), or in the
case of a sale or conveyance to another corporation of the property of the
Company as an entirety, the Holder shall thereafter have the right to purchase
the kind and number of shares of stock and other securities and property
receivable upon such reclassification, change, consideration, merger, sale or
conveyance as if the Holder were the owner of the shares of Common Stock
underlying the Underwriters' Warrant immediately prior to any such events (but
not the Warrant Shares) at a price equal to the product of (A) the number of
shares issuable upon exercise of the Underwriters' Warrant (but not the Warrant
Shares) and (B) the Share Exercise Price in effect immediately prior to the
record date for such reclassification, change, consolidation, merger, sale or
conveyance as if such Holder had exercised the Underwriters' Warrant. (z) If
after the date hereof and prior to the exercise and expiration of the
Underwriters' Warrant the Company shall declare a dividend (other than a
dividend consisting solely of shares of Common Stock or a cash dividend or
distribution payable out of current or retained earnings) or otherwise
distribute to the holders of Common Stock any monies, assets, property, rights,
evidences of indebtedness, securities (other than such a cash dividend or
distribution or dividend consisting solely of shares of Common Stock), whether
issued by the Company or by another person or entity, or any other thing of
value, the Holders of the unexercised Underwriters' Warrant shall thereafter be
entitled, in addition to the shares of Common Stock or other securities
receivable upon the exercise thereof, to receive, upon the exercise of such
Underwriters' Warrant, the same monies, property, assets, rights, evidences of
indebtedness, securities or any other thing of value that they would have been
entitled to receive at the time of such dividend or distribution as if the
Holders were the owners of the shares of Common Stock underlying the
Underwriters' Warrant (but not the Warrant Shares). As the time of any such
dividend or distribution, the Company shall make appropriate reserves to ensure
the timely performance of the provisions of this Paragraph 8 (a)(i)(z).
(ii) Whenever the Share Exercise Price is adjusted pursuant to
subparagraph 8(a)(i), or the Warrant Exercise Price is adjusted pursuant to
paragraph 8(b), the
9
number of shares of Common Stock or Warrants, as the case may be, issuable upon
exercise of this Underwriter's Warrant shall simultaneously be adjusted to the
nearest full whole number by multiply ing the number of shares of Common Stock
or Warrants, as the case may be, issuable upon exercise of this Underwriter's
Warrant by the Share Exercise Price or Warrant Exercise Price, as the case may
be, in effect on the date hereof and dividing the product so obtained by the
Share Exercise Price or Warrant Exercise Price, as adjusted.
(iii) Notwithstanding anything to the contrary no adjustment in the
Share Exercise Price or Warrant Exercise Price shall be required (a) in the
event of the sale of the Company's securities in a future bona fide underwritten
public offering; or (b) if the amount of such adjustment shall be less than five
cents ($0.05) in the Share Exercise Price; provided, however, that any
adjustments which by reason of this subparagraph (iii)(b) are not required to be
made shall be carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations under this paragraph
8(a) shall be made to the nearest cent or to the nearest one-hundredth of a
share, as the case may be. Anything in this Section 8(a) to the contrary
notwithstanding, the Company shall be entitled, but shall not be required, to
make such changes in the Share Exercise Price or Warrant Exercise Price, in
addition to those required by this Section 8, as it shall determine, in its sole
discretion, to be advisable in order that any dividend or distribution in shares
of Common Stock or Warrants, or any subdivision, reclassification or combination
thereof, hereafter made by the Company shall not result in any federal income
tax liability to the holders of Common Stock or securities convertible into
Common Stock (including the Warrants issuable upon exercise of the Underwriter's
Warrant).
(iv) Whenever the Exercise Prices are adjusted, as herein provided, the
Company shall promptly cause a notice setting forth the adjusted Exercise Prices
and the adjusted number of shares of Common Stock, Warrants or other securities
purchasable upon exercise of the Underwriter's Warrant to be mailed to the
Holder, at the addresses listed on the books of the Company, and shall cause a
certified copy thereof to be mailed to the Company's transfer agent, if any. The
Company may retain a firm of independent certified public accountants selected
by the Board of Directors (who may be the regular accountants employed by the
Company) to make any computation required by this paragraph 8, and a certificate
signed by such firm shall be conclusive evidence of the correctness of such
adjustment.
(v) If after the date hereof, as a result of an adjustment made
pursuant to the provisions of this paragraph 8, the Holder shall become entitled
to receive any securities of the Company, other than Common Stock and the
Warrants, the exercise price and number of such other securities so receivable
upon exercise of the Underwriter's Warrant shall be subject to adjustment from
time to time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Common Stock contained in subparagraphs 8(a),
inclusive of this paragraph (v).
8. (b) In the event of an adjustment in the Share Exercise Price and the
number of Shares of Common Stock issuable upon the exercise of the Underwriter's
Warrant, pursuant to
10
paragraph 8(a), then there shall be a proportional adjustment in the Warrant
Exercise Price and the number of Warrants issuable upon the exercise of the
Underwriter's Warrant.
9. This Agreement shall be governed by and in accordance with the laws
of the State of New York.
IN WITNESS WHEREOF, DECTRON INTERNATIONALE INC. has caused this
Underwriter's Warrant to be signed by its duly authorized officers, and this
Underwriter's Warrant to be dated as of the date first above written.
DECTRON INTERNATIONALE INC.
By:
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Name:
Title:
11
PURCHASE FORM
(To be signed only upon exercise of Underwriter's Warrant)
The undersigned, the holder of the foregoing Underwriter's Warrant, hereby
irrevocably elects to exercise the purchase rights represented by such Warrant
for, and to purchase thereunder, Shares of DECTRON INTERNATIONALE INC., no par
value per share, and/or Common Stock Purchase Warrants to purchase one (1) share
of Common Stock, and herewith makes payment of $ therefor (or hereby surrenders
and delivers that portion of the Underwriter's Warrant having equivalent value
(as determined in accordance with the provisions of subparagraph (d) of
paragraph 2 of the Underwriter's Warrant)), and requests that the certificates
for shares of Common Stock and/or Warrants be issued in the name(s) of, and
delivered to , whose address(es) is (are):
Dated: , 19
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Signature
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(Print name under signature)
(Signature must conform in all
respects to the name of Holder as
specified on the face of the
Underwriter's Warrant).
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(Insert Social Security or Other
Identifying Number of Holder)
11
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Warrant)
FOR VALUE RECEIVED
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hereby sells, assigns and transfers unto
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(Please print name and address of transferee)
this Warrant, together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint __________________Attorney, to
transfer the within Warrant on the books of DECTRON INTERNATIONALE INC., with
full power of substitution.
Dated:
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Signature
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(Print name under signature)
(Signature must conform in all
respects to the name of Holder as
specified on the face of the
Underwriter's Warrant).
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(Insert Social Security or Other
Identifying Number of Holder)
12