Exhibit 4.4
THIS WARRANT AND THE SHARES OF CAPITAL STOCK ISSUED UPON ANY EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD
OR OTHERWISE TRANSFERRED BY ANY PERSON, INCLUDING A PLEDGEE, UNLESS (1) EITHER
(A) A REGISTRATION STATEMENT WITH RESPECT THERETO SHALL BE EFFECTIVE UNDER THE
SECURITIES ACT, OR (B) THE COMPANY SHALL HAVE RECEIVED AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT IS AVAILABLE, AND (2) THERE SHALL HAVE BEEN COMPLIANCE WITH ALL
APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS.
No. IW-001
For the Purchase
of 320,000 shares
of Common Stock
WARRANT TO PURCHASE
COMMON STOCK
OF
HARBOR BUSINESS ACQUISITION CORP.
(A Delaware Corporation)
Harbor Business Acquisition Corp., a Delaware corporation (the
"COMPANY"), for value received, hereby certifies that HARBOR HEALTHCARE HOLDING
LLC (the "HOLDER"), is entitled, subject to the terms set forth below, to
purchase from the Company, at any time or from time to time at or before the
earlier of (i) 5:00 p.m. Eastern Standard Time on [______] (the "EXPIRATION
DATE"), (ii) the termination of this Warrant as provided in Section 8 hereof, or
(iii) the redemption of this Warrant as provided in Section 9 hereof, 320,000
shares of Common Stock, par value $0.001 per share, of the Company (the "COMMON
STOCK"), at a purchase price per share equal to Five Dollars ($5.00) per share,
as adjusted upon the occurrence of certain events as set forth in Section 3 of
this Warrant. The shares of stock issuable upon exercise of this Warrant, and
the purchase price per share, are hereinafter referred to as the "WARRANT STOCK"
and the "PURCHASE PRICE," respectively.
1. Exercise.
1.1 Manner of Exercise; Payment in Cash. This Warrant may be
exercised by the Holder, in whole or in part:
(a) commencing 3 months following the closing of the Company's
first Business Combination (as defined in the Company's Certificate
of Incorporation) (the "INITIAL BUSINESS COMBINATION") (i) as to
one-half of the shares covered by this Warrant, if, and only if, the
last sales price of the Common Stock equals or exceeds $7.50 per
share for any 20 trading days within a 30 trading day period
beginning after such Initial Business Combination, and (ii) as to
the remaining shares covered by this Warrant, if and only if, the
last sales price of the Common Stock equals or exceeds $9.00 per
share for any 20 trading days within a 30 trading day period
beginning after such Initial Business Combination; provided,
however, that, appropriate adjustments shall be made in the
application of the provisions of this Section 1.1(a) in the event of
any adjustments to the Purchase Price pursuant to Section 3 hereof;
and
(b) by surrendering this Warrant, with the purchase form
appended hereto as Exhibit A duly executed by the Holder, at the
principal office of the Company, or at such other place as the
Company may designate, accompanied by payment in full of the
Purchase Price payable in respect of the number of shares of Warrant
Stock purchased upon such exercise. Subject to Section 1.4 hereof,
payment of the Purchase Price shall be in cash or by certified or
official bank check payable to the order of the Company.
1.2 Effectiveness. Each exercise of this Warrant shall be deemed to
have been effected immediately prior to the close of business on the day on
which this Warrant shall have been surrendered to the Company as provided in
Section 1.1 above. At such time, the person or persons in whose name or names
any certificates for Warrant Stock shall be issuable upon such exercise as
provided in Section 1.3 below shall be deemed to have become the holder or
holders of record of the Warrant Stock represented by such certificates.
1.3 Delivery of Certificates. As soon as practicable after the
exercise of this Warrant in whole or in part, and in any event within ten (10)
business days thereafter, the Company, at its sole expense, will cause to be
issued in the name of, and delivered to, the Holder, or, subject to the terms
and conditions hereof, as such Holder (upon payment by such Holder of any
applicable transfer taxes) may direct:
(a) A certificate or certificates for the number of full
shares of Warrant Stock to which such Holder shall be entitled upon
such exercise plus, in lieu of any fractional share to which such
Holder would otherwise be entitled, cash in an amount determined
pursuant to Section 1.4(c) hereof; and
(b) In case such exercise is in part only, a new warrant or
warrants (dated the date hereof) of like tenor, calling in the
aggregate on the face or faces thereof for the number of shares of
Warrant Stock (without giving effect to any adjustment therein)
equal to the number of such shares called for on the face of this
Warrant minus the number of such shares purchased by the Holder upon
such exercise as provided in Section 1.1 above.
1.4 Right to Convert Warrant into Stock: Net Issuance.
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(a) Right to Convert. Subject to Section 7, in addition to and
without limiting the rights of the Holder under the terms of this
Warrant, provided that this Warrant may then be exercised pursuant
to Section 1.1(a) hereof, the Holder shall have the right to convert
this Warrant or any portion thereof, to the extent it is then
exercisable as provided in Section 1.1(a) hereof (the "CONVERSION
RIGHT") into shares of Common Stock as provided in this Section 1.4
at any time or from time to time during the term of this Warrant.
Upon exercise of the Conversion Right with respect to a particular
number of shares subject to this Warrant (the "Converted Warrant
Shares"), the Company shall deliver to the Holder (without payment
by the holder of any Purchase Price or any cash or other
consideration) that number of shares of fully paid and nonassessable
Common Stock equal to the quotient obtained by dividing (X) the
value of this Warrant (or the specified portion hereof) on the
Conversion Date (as defined in subsection (b) hereof), which value
shall be determined by subtracting (A) the aggregate Purchase Price
of the Converted Warrant Shares immediately prior to the exercise of
the Conversion Right from (B) the aggregate fair market value of the
Converted Warrant Shares issuable upon exercise of this Warrant (or
the specified portion hereof) on the Conversion Date (as herein
defined) by (Y) the fair market value of one share of Common Stock
on the Conversion Date (as herein defined).
2
Expressed as a formula, such conversion shall be computed as
follows:
X = B-A
---
Y
where: X = the number of shares of Common Stock that
may be issued to the Holder
Y = the fair market value (FMV) of one share of
Common Stock
A = the aggregate Warrant Price (Converted Warrant
Shares x Purchase Price)
B = the aggregate FMV (i.e., FMV x Converted Warrant
Shares)
No fractional shares shall be issuable upon exercise of the
Conversion Right, and, if the number of shares to be issued
determined in accordance with the foregoing formula is other than a
whole number, the Company shall pay to the Holder an amount in cash
equal to the fair market value of the resulting fractional share on
the Conversion Date.
(b) Method of Exercise. The Conversion Right may be exercised
by the Holder by the surrender of this Warrant at the principal
office of the Company together with the Purchase Form in the form
attached hereto duly completed and executed and indicating the
number of shares subject to this Warrant which are being surrendered
(referred to in Section 1.4(a) hereof as the Converted Warrant
Shares) in exercise of the Conversion Right. Such conversion shall
be effective upon receipt by the Company of this Warrant together
with the aforesaid written statement, or on such later date as is
specified therein (the "CONVERSION DATE"), and, at the election of
the Holder, may be made contingent upon the occurrence of any of the
events specified in Section 8. Certificates for the shares issuable
upon exercise of the Conversion Right and, if applicable, a new
Warrant evidencing the balance of the shares remaining subject to
this Warrant, shall be issued as of the Conversion Date and shall be
delivered to the Holder within thirty (30) days following the
Conversion Date.
3
(c) Determination of Fair Market Value. For purposes of this
Agreement, "fair market value" of a share of Common Stock as of a
particular date (the "DETERMINATION DATE") shall mean:
(i) If traded on a securities exchange, the fair
market value of the Common Stock shall be
deemed to be the average of the closing
prices of the Common Stock on such exchange
over the five-day period ending one business
day prior to the Determination Date or, if
less, such number of days as the Common Stock
has been traded on such exchange;
(ii) If traded over-the-counter, the fair market
value of the Common Stock shall be deemed to
be the average of the closing bid prices of
the Common Stock over the five-day period
ending one business day prior to the
Determination Date or, if less, such number
of days as the Common Stock has been traded
over-the-counter; and
(iii) If there is no public market for the Common
Stock, then fair market value shall be
determined in good faith by the Board of
Directors of the Company.
2. Fractional Shares. The Company shall not be required upon
the exercise of this Warrant to issue any fractional shares, but instead shall,
upon such exercise, round up or down to the nearest whole number of shares of
Common Stock to be issued to the Holder.
3. Certain Adjustments.
3.1 Changes in Common Stock. In case the Company shall at any
time after the date hereof (i) declare a dividend on the outstanding shares of
Common Stock payable solely in shares of its capital stock, (ii) subdivide the
outstanding shares of Common Stock, (iii) combine the outstanding shares of
Common Stock into a lesser number of shares, or (iv) issue any shares of its
capital stock by reclassification of the shares of Common Stock (including any
such reclassification in connection with a consolidation or merger in which the
Company is the continuing corporation), then, in each case, the Purchase Price,
and the number and kind of securities issuable upon exercise or conversion of
this Warrant, in effect at the time of the record date for such dividend or of
the effective date of such subdivision, combination, or reclassification, shall
be proportionately adjusted so that, subject to Section 1.1(a) hereof, the
Holder after such time shall be entitled to receive upon exercise of this
Warrant the aggregate number and kind of shares which, if such Warrant had been
exercised or converted immediately prior to such time (assuming all of the
requirements of Section 1.1(a) had been satisfied), such Holder would have owned
upon such exercise or conversion and been entitled to receive by virtue of such
dividend, subdivision, combination, or reclassification. Such adjustment shall
be made successively whenever any event listed above shall occur.
3.2 Reorganizations and Reclassifications. If there shall
occur any capital reorganization or reclassification of the Common Stock (other
than a change in par value or a subdivision or combination as provided for in
Section 3.1), then, as part of any such reorganization or reclassification,
lawful provision shall be made so that the Holder shall have the right
thereafter to receive upon the exercise of this Warrant the kind and amount of
shares of stock or other securities or property which such Holder would have
been entitled to receive if, immediately prior to any such reorganization or
reclassification (assuming all of the requirements of Section 1.1(a) had been
satisfied), such Holder had held the number of shares of Common Stock which were
then subject to this Warrant. In any such case, appropriate adjustment (as
reasonably determined by the Board of Directors of the Company) shall be made in
the application of the provisions set forth herein with respect to the rights
and interests thereafter of the Holder, such that the provisions set forth in
this Section 3 (including provisions with respect to adjustment of the Purchase
Price) shall thereafter be applicable, as nearly as is reasonably practicable,
in relation to any shares of stock or other securities or property thereafter
deliverable upon the exercise of this Warrant.
4
3.3 Merger, Consolidation or Sale of Assets. Subject to the
provisions of Section 7, if there shall be a merger or consolidation of the
Company with or into another corporation (other than a merger or reorganization
involving only a change in the state of incorporation of the Company or the
acquisition by the Company of other businesses where the Company survives as a
going concern), or the sale of all or substantially all of the Company's capital
stock or assets to any other person, then as a part of such transaction,
provision shall be made so that, subject to Section 1.1(a) hereof, the Holder
shall thereafter be entitled to receive upon exercise of this Warrant the number
of shares of stock or other securities or property of the Company, or of the
successor corporation resulting from the merger, consolidation or sale, to which
the Holder would have been entitled if the Holder had exercised its rights
pursuant to the Warrant immediately prior thereto (assuming all of the
requirements of Section 1.1(a) hereof had been satisfied). In any such case,
appropriate adjustment shall be made in the application of the provisions of
this Section 3 to the end that the provisions of this Section 3 shall be
applicable after that event in as nearly equivalent a manner as may be
practicable.
3.4 Certificate of Adjustment. When any adjustment is required
to be made in the number of shares of Common Stock or other securities or
property issuable upon exercise of this Warrant or in the Purchase Price, the
Company shall promptly mail to the Holder a certificate setting forth such
number of shares or other securities or property or the Purchase Price after
such adjustment and setting forth a brief statement of the facts requiring such
adjustment. Delivery of such certificate shall be deemed to be a final and
binding determination with respect to such adjustment absent manifest error
unless challenged by the Holder within ten (10) days of receipt thereof.
4. Compliance with Securities Act.
4.1 Unregistered Securities. The Holder acknowledges that this
Warrant and the Warrant Stock have not been registered under the Securities Act
of 1933, as amended, and the rules and regulations thereunder, or any successor
legislation (the "SECURITIES ACT"), and agrees not to sell, pledge, distribute,
offer for sale, transfer or otherwise dispose of this Warrant or any Warrant
Stock in the absence of (a) an effective registration statement under the
Securities Act covering this Warrant or such Warrant Stock and registration or
qualification of this Warrant or such Warrant Stock under any applicable "blue
sky" or state securities law then in effect, or (b) an opinion of counsel,
satisfactory to the Company, that such registration and qualification are not
required. The Company may delay issuance of the Warrant Stock until completion
of any action or obtaining of any consent, which the Company deems necessary
under any applicable law (including, without limitation, state securities or
"blue sky" laws).
5
4.2 Investment Letter. Without limiting the generality of
Section 4.1, unless the offer and sale of any shares of Warrant Stock shall have
been effectively registered under the Securities Act, the Company shall be under
no obligation to issue the Warrant Stock unless and until the Holder shall have
executed an investment letter in form and substance satisfactory to the Company,
including a warranty at the time of such exercise that the Holder is acquiring
such shares for his, her or its own account, for investment and not with a view
to, or for sale in connection with, the distribution of any such shares.
4.3 Legend. Certificates delivered to the Holder pursuant to
Section 1.3 shall bear the following legend or a legend in substantially similar
form: ------
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY APPLICABLE STATE SECURITIES LAWS AND
MAY NOT BE SOLD OR OTHERWISE TRANSFERRED BY ANY PERSON,
INCLUDING A PLEDGEE, UNLESS (1) EITHER (A) A REGISTRATION
STATEMENT WITH RESPECT THERETO SHALL BE EFFECTIVE UNDER THE
SECURITIES ACT, OR (B) THE COMPANY SHALL HAVE RECEIVED AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT IS
AVAILABLE."
5. Reservation of Stock. The Company will at all times reserve
and keep available, solely for issuance and delivery upon the exercise of this
Warrant, such shares of Warrant Stock and other stock, securities and property,
as from time to time shall be issuable upon the exercise of this Warrant. The
Company covenants that all shares of Warrant Stock so issuable will, when issued
against payment therefor, be duly and validly issued and fully paid and
nonassessable.
6. Replacement of Warrants. Upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant and, in the case of loss, theft or destruction, upon
delivery of an indemnity agreement (with surety if reasonably required) in an
amount reasonably satisfactory to the Company, or in the case of mutilation upon
surrender and cancellation of this Warrant, the Company will issue, in lieu
thereof, a new Warrant of like tenor.
7. Termination Upon Certain Events. If, subsequent to the
Initial Business Combination, there shall be a merger or consolidation of the
Company with or into another corporation (other than a merger or reorganization
involving only a change in the state of incorporation of the Company or the
acquisition by the Company of other businesses where the Company survives as a
going concern), or the sale of all or substantially all of the Company's capital
stock or assets to any other person, or the liquidation or dissolution of the
Company, then as a part of such transaction, at the Company's option, either:
(a) provision shall be made so that, subject to Section 1.1(a)
hereof, the Holder shall thereafter be entitled to receive upon
exercise of this Warrant the number of shares of stock or other
securities or property of the Company, or of the successor
corporation resulting from the merger, consolidation or sale, to
which the Holder would have been entitled if the Holder had
exercised its rights pursuant to the Warrant immediately prior
thereto (assuming all of the requirements of Section 1.1(a) had been
satisfied), and, in such case, appropriate adjustment shall be made
in the application of the provisions of this Section 7(a) to the end
that the provisions of this Section 7(a) shall be applicable after
that event in as nearly equivalent a manner as may be practicable;
or
6
(b) this Warrant shall terminate on the effective date of such
merger, consolidation or sale (the "TERMINATION DATE") and become
null and void, provided, that if this Warrant shall not have
otherwise terminated or expired, (i) the Company shall have given
the Holder written notice of such Termination Date at least twenty
(20) business days prior to the occurrence thereof, and (ii) the
Holder shall have the right, until 5:00 p.m., Eastern Standard Time,
on the day immediately prior to the Termination Date to exercise its
rights hereunder to the extent not previously exercised and without
regard to whether the requirements set forth in Section 1.1(a)
hereof have been satisfied.
8. Transferability. This Warrant shall not be assigned,
pledged or hypothecated in any way and shall not be subject to execution,
attachment or similar process until such time as the Company completes the
Initial Business Combination. The foregoing transfer restriction shall not apply
to (a) transfers resulting from the death of any of the Holders, (b) transfers
by operation of law, (c) any transfer for estate planning purposes to persons
immediately related to the transferor by blood, marriage or adoption, or (d) any
trust solely for the benefit of such transferor and/or the persons described in
the preceding clause; provided, however, that with respect to each of the
transfers described in clauses (a), (b), (c) and (d) of this sentence, prior to
such transfer, each permitted transferee or the trustee or legal guardian for
each permitted transferee agrees in writing to be bound by the terms of this
Warrant. Any attempted transfer, assignment, pledge, hypothecation or other
disposition of this Warrant or of any rights granted hereunder contrary to the
provisions of this Section 8, or the levy of any attachment or similar process
upon this Warrant or such rights, shall be null and void.
9. Redemption. The Warrant shall be non-redeemable so long as
the Holder holds such Warrant following its issuance by the Company to such
Holder. In the event the Warrant is transferred by the Holder other than to a
transferee permitted pursuant to Section 8 hereof, then the Warrant may be
redeemed in whole, and not in part, at a price of $0.01 per Warrant, upon a
minimum of 30 days' prior written notice of redemption, if, and only if, the
last sales price of the Company's Common Stock equals or exceeds $8.50 per share
for any twenty (20) trading days within any thirty (30) trading day period
ending three (3) business days before the Company sends the notice of
redemption.
7
10. Registration Rights. This Warrant, together with the
shares of Warrant Stock underlying this Warrant, are and will be entitled to
registration rights under a registration rights agreement between the Holder and
the Company.
11. No Rights as Shareholder. Until the exercise of this
Warrant, the Holder shall not have or exercise any rights as a stockholder of
the Company. ------------------------
12. Notices. All notices, requests and other communications
hereunder shall be in writing, shall be (a) delivered by hand, (b) sent by
overnight courier, or (c) sent by registered or certified mail, postage prepaid,
return receipt requested. In the case of notices from the Company to the Holder,
they shall be sent to the address furnished to the Company in writing by the
last Holder who shall have furnished an address to the Company in writing. All
notices from the Holder to the Company shall be delivered to the Company at its
offices at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or such other
address as the Company shall so notify the Holder. All notices, requests and
other communications hereunder shall be deemed to have been given (i) if made by
hand, at the time of the delivery thereof to the receiving party at the address
of such party described above, (ii) if sent by overnight courier, on the next
business day following the day such notices is delivered to the courier service,
or (iii) if sent by registered or certified mail, on the third business day
following the day of registration or certification thereof.
13. Waivers and Modifications. Any term or provision of this
Warrant may be waived only by written document executed by the party entitled to
the benefits of such terms or provisions. The terms and provisions of this
Warrant may be modified or amended only by written agreement executed by the
parties hereto.
14. Headings. The headings in this Warrant are for convenience
of reference only and shall in no way modify or affect the meaning or
construction of any of the terms or provisions of this Warrant.
15. Governing Law. This Warrant will be governed by and
construed in accordance with and governed by the laws of Delaware, without
giving effect to the conflict of law principles thereof.
HARBOR BUSINESS
ACQUISITION CORP.
By:
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Name: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
8
EXHIBIT A
PURCHASE FORM
To: HARBOR BUSINESS ACQUISITION CORP.
The undersigned pursuant to the provisions set forth in the attached
Warrant (No. WCS-____), hereby irrevocably elects to (check one):
_____(A) purchase __________ shares of the Common Stock, par value
$0.001 per share, of Harbor Business Acquisition Corp. (the
"COMMON STOCK"), covered by such Warrant and herewith makes
payment of $____________, representing the full purchase price
for such shares at the price per share provided for in such
Warrant; or
_____(B) convert _________ Converted Warrant Shares into that
number of shares of fully paid and nonassessable shares of
Common Stock, determined pursuant to the provisions of Section
1.4 of the Warrant.
The Common Stock for which the Warrant may be exercised or converted shall be
known herein as the "WARRANT STOCK."
The undersigned is aware that the Warrant Stock has not been and will
not be registered under the Securities Act of 1933, as amended (the "Securities
Act"), or any state securities laws. The undersigned understands that reliance
by the Company on exemptions under the Securities Act is predicated in part upon
the truth and accuracy of the statements of the undersigned in this Purchase
Form.
The undersigned represents and warrants that (a) he, she or it has been
furnished with all information which he, she or it deems necessary to evaluate
the merits and risks of the purchase of the Warrant Stock, (b) e, she or it has
had the opportunity to ask questions concerning the Warrant Stock and the
Company and all questions posed have been answered to his, her or its
satisfaction, (c) e, she or it has been given the opportunity to obtain any
additional information it deems necessary to verify the accuracy of any
information obtained concerning the Warrant Stock and the Company, and (d) t has
such knowledge and experience in financial and business matters that it is able
to evaluate the merits and risks of purchasing the Warrant Stock and to make an
informed investment decision relating thereto.
The undersigned hereby represents and warrant that it is purchasing the
Warrant Stock for his, her or its own account for investment and not with a view
to the sale or distribution of all or any part of the Warrant Stock.
The undersigned understands that because the Warrant Stock has not been
registered under the Securities Act he, she or it must continue to bear the
economic risk of the investment for an indefinite period of time and the Warrant
Stock cannot be sold unless it is subsequently registered under applicable
federal and state securities laws or an exemption from such registration is
available.
The undersigned agrees that he, she or it will in no event sell or
distribute or otherwise dispose of all or any part of the Warrant Stock unless
(1) here is an effective registration statement under the Securities Act and
applicable state securities laws covering any such transaction involving the
Warrant Stock, or (2) he Company receives an opinion satisfactory to the Company
of the undersigned's legal counsel stating that such transaction is exempt from
registration. The undersigned consents to the placing of a legend on his, her or
its certificate for the Warrant Stock stating that the Warrant Stock has not
been registered and setting forth the restriction on transfer contemplated
hereby and to the placing of a stop transfer order on the books of the Company
and with any transfer agents against the Warrant Stock until the Warrant Stock
may be legally resold or distributed without restriction.
The undersigned has considered the federal and state income tax
implications of the exercise of the Warrant and the purchase and subsequent sale
of the Warrant Stock.
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Dated:
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